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| 8-K - CURRENT REPORT - INNOVUS PHARMACEUTICALS, INC. | innv8K_nov142017.htm |
Exhibit
99.1
Innovus Pharmaceuticals Reports Nine Month Net Revenue of $6.4
million
and Net Loss Decrease of 51.6% Compared to the Same Period in
2016
Quarterly and Year-to-Date Net Revenue Increase
18.0% and 105.8% When Compared to 2016
FlutiCare™ Launches on November 14, 2017
SAN
DIEGO, November 14, 2017 – Innovus Pharmaceuticals, Inc.,
(“Innovus Pharma” or the “Company”) (OTCQB:
INNV), today announced third quarter 2017 net revenue of $2.2
million compared to $1.9 million in net revenue for the same period
in 2016. Net revenue for the nine months ended September 30, 2017
was $6.4 million compared to $3.1 million for the same period in
2016.
“We
have increased our year-to-date product sales by over 105% when
compared to the prior year without the potential added sales of
FlutiCare™.
This demonstrates our continued ability to generate significant
sales growth from new and existing products through our Beyond
Human® Sales and Marketing Platform,” stated Bassam
Damaj, President and Chief Executive Officer of Innovus Pharma.
“Our first commercial batch of FlutiCare™ was received
in October and we launched FlutiCare™ today which is one of
the largest milestones for the Company. With the launch, we expect
to continue the trend of increasing our net revenue while
decreasing our loss from operations as we work towards our goal of
profitability in 2018,” continued Dr. Damaj.
Financial highlights for the three months ended September 30, 2017
included:
●
Net revenue totaled
$2.2 million for the three months ended September 30, 2017,
compared to net revenue of $1.9 million for the three months ended
September 30, 2016.
●
Net revenue during
the third quarter of 2017 was impacted by the natural disasters in
Florida and Texas as the Company was unable to advertise its
products for a period of time in those regions as a result. These
two states generate close to 15% of our total net revenue and have
a population of approximately 17 million in our targeted product
demographics*.
●
Total operating
expense was $3.4 million for the three months ended September 30,
2017 or year over year decrease of $0.7 million or 16.7% when
compared to the three months ended September 30, 2016.
●
Loss from
operations decreased by $1.0 million or 45.8% to $1.2 million for
the three months ended September 30, 2017 compared to the three
months ended September 30, 2016.
●
Net loss totaled
$1.3 million, or ($0.01) per common share, for the three months
ended September 30, 2017 representing a 70.0% decrease year over
year. The net loss included $0.5 million in non-cash expense
related to the amortization of debt discounts, stock-based
compensation and depreciation and amortization. Net loss for the
three months ended September 30, 2016 totaled $4.4 million or
($0.04) per common share.
●
Cash used in
operations decreased to approximately $577,000 for the three months
ended September 30, 2017 compared to approximately $996,000 for the
three months ended September 30, 2016.
●
Cash balance
totaled $1.3 million at September 30, 2017.
Financial highlights for the nine months ended September 30, 2017
included:
●
Net revenue
increased 105.8% to $6.4 million for the nine months ended
September 30, 2017, compared to net revenue of $3.1 million for the
nine months ended September 30, 2016.
●
Gross margin
increased to 79.4% for the nine months ended September 30, 2017,
higher than gross margin for the nine months ended September 30,
2016 which totaled 77.2%.
●
Total operating
expense increased to $10.4 million and included $1.0 million in
non-cash share-based compensation and $0.5 million in non-cash
depreciation and amortization for the nine months ended September
30, 2017.
●
Net loss totaled
$5.0 million, or ($0.03) per common share, for the nine months
ended September 30, 2017. The net loss included a non-cash expense
of $0.4 million for the loss on extinguishment of debt as a result
of the prepayment of the remaining 2016 convertible debentures and
settlement of notes payable. The net loss also included interest
expense of $0.8 million, of which $0.7 million was non-cash and
related to the amortization of debt discounts. Net loss for the
nine months ended September 30, 2016 totaled $10.3 million or
($0.12) per common share.
Third quarter 2017 and recent developments:
●
Received our first commercial batch of 220,000
units of FlutiCare™ in
October and launched FlutiCare™ in the U.S. in November
2017;
●
Moved corporate and
company operations into a new 17,000 square-foot facility in San
Diego, CA in November 2017 that will bring in-house the
Company’s product fulfillment and inventory storage process.
The move is designed to lower product fulfillment costs which will
increase our gross product margins and decrease our loss from
operations, as well as, provide the necessary office space to
accommodate our expected revenue growth in 2018;
●
The combination of
Apeaz™ cream for arthritis pain relief and ArthriVarx™,
a supplement designed to maximize and support joint health,
launched under the Beyond Human® Sales and Marketing Platform
in July 2017;
●
Entered into an
agreement with ACON
Laboratories, Inc. to offer our customers a new FDA cleared urinary
tract infection test in combination with their purchase of
UriVarx™ and an FDA cleared glucose monitoring meter and test
strips called the GlucoGorx™ Kit with their purchase of
GlucoGorx™, the Company’s upcoming supplement for
diabetic patients;
●
Received approval
as a Natural Health Product by Health Canada for UriVarx™ for
the indication to reduce symptoms of overactive bladder in
September 2017 and for Vesele® to help improve nitric oxide
production in symptoms of sexual dysfunction in October
2017;
●
Continued expansion
of patent portfolio by receiving first Notification to Grant a
Patent Right for Sensum+® in China in October 2017.
Innovus Pharma has currently fourteen
(14) issued patents and eight (8) patent applications covering
several of its products and has licensed in an additional four (4)
patents and five (5) patent applications from third parties
covering additional products;
●
Expanded the
exclusive license and distribution territory under our agreement
with Densmore to Singapore and Vietnam in July 2017;
and
●
Approval
notification as a Class I medical device was received to
commercialize Zestra® in Australia in July 2017 and in New
Zealand in September 2017.
The
Company will host a conference call at 4:15 p.m. ET/1:15 p.m. PT
today to discuss the financial results and recent business
developments. To participate in the call, please dial
1-877-883-0383 for domestic callers or 1-412-902-6506 for
international callers. Participant Elite Entry
Number: 5606897. A replay of the call will be available for 30
days. To access the replay, dial 1-877-344-7529 domestically
or 1-412-317-0088 internationally and reference Conference ID:
10113950. The replay will be available shortly after the end of the
conference call.
Consolidated Statements of Operations
|
|
(Unaudited)
For the
Three Months Ended
|
||
|
|
September 30,
|
||
|
|
2017
|
2016
|
|
|
Net
revenue:
|
|
|
|
|
Product sales, net
|
$2,218,343
|
$1,882,129
|
|
|
License revenue
|
2,500
|
-
|
|
|
Net
revenue
|
2,220,843
|
1,882,129
|
|
|
|
|
|
|
|
Operating
expense:
|
|
|
|
|
Cost of product sales
|
480,076
|
331,227
|
|
|
Research and development
|
8,736
|
43,775
|
|
|
Sales and marketing
|
1,626,630
|
1,972,155
|
|
|
General and administrative
|
1,321,001
|
1,779,048
|
|
|
Total
operating expense
|
3,436,443
|
4,126,205
|
|
|
|
|
|
|
|
Loss
from operations
|
(1,215,600)
|
(2,244,076)
|
|
|
|
|
|
|
|
Other
income and (expense):
|
|
|
|
|
Interest expense
|
(104,276)
|
(3,719,200)
|
|
|
Loss on extinguishment of debt
|
(89,341)
|
-
|
|
|
Other income (expense), net
|
(4,800)
|
(37)
|
|
|
Fair value adjustment for contingent consideration
|
69,305
|
186,813
|
|
|
Change in fair value of derivative liabilities
|
16,055
|
1,350,688
|
|
|
Total
other expense, net
|
(113,057)
|
(2,181,736)
|
|
|
|
|
|
|
|
Loss
before provision for income taxes
|
(1,328,657)
|
(4,425,812)
|
|
|
|
|
|
|
|
Provision
for income taxes
|
-
|
-
|
|
|
|
|
|
|
|
Net
loss
|
$(1,328,657)
|
$(4,425,812)
|
|
|
|
|
|
|
|
Net
loss per share of common stock – basic and
diluted
|
$(0.01)
|
$(0.04)
|
|
|
|
|
|
|
|
Weighted
average number of shares of common stock outstanding – basic
and diluted
|
161,587,934
|
104,972,645
|
|
|
|
(Unaudited)
For the
Nine Months Ended
|
||
|
|
September 30,
|
||
|
|
2017
|
2016
|
|
|
Net
revenue:
|
|
|
|
|
Product sales, net
|
$6,426,790
|
$3,126,112
|
|
|
License revenue
|
10,000
|
1,000
|
|
|
Net
revenue
|
6,436,790
|
3,127,112
|
|
|
|
|
|
|
|
Operating
expense:
|
|
|
|
|
Cost of product sales
|
1,329,131
|
714,284
|
|
|
Research and development
|
26,982
|
47,667
|
|
|
Sales and marketing
|
4,869,717
|
2,257,166
|
|
|
General and administrative
|
4,207,899
|
4,012,357
|
|
|
Total
operating expense
|
10,433,729
|
7,031,474
|
|
|
|
|
|
|
|
Loss
from operations
|
(3,996,939)
|
(3,904,362)
|
|
|
|
|
|
|
|
Other
income and (expense):
|
|
|
|
|
Interest expense
|
(771,885)
|
(5,970,450)
|
|
|
Loss on extinguishment of debt
|
(394,169)
|
-
|
|
|
Other income (expense), net
|
(5,622)
|
1,839
|
|
|
Fair value adjustment for contingent consideration
|
195,459
|
164,479
|
|
|
Change in fair value of derivative liabilities
|
(32,138)
|
(632,627)
|
|
|
Total
other expense, net
|
(1,008,355)
|
(6,436,759)
|
|
|
|
|
|
|
|
Loss
before provision for income taxes
|
(5,005,294)
|
(10,341,121)
|
|
|
|
|
|
|
|
Provision
for income taxes
|
3,200
|
-
|
|
|
|
|
|
|
|
Net
loss
|
$(5,008,494)
|
$(10,341,121)
|
|
|
|
|
|
|
|
Net
loss per share of common stock – basic and
diluted
|
$(0.03)
|
$(0.12)
|
|
|
|
|
|
|
|
Weighted
average number of shares of common stock outstanding – basic
and diluted
|
152,325,196
|
86,498,234
|
|
|
|
|
|
|
Condensed Consolidated Balance Sheet Data
|
|
September 30,
|
December
31,
|
|
|
2017
|
2016
|
|
|
(Unaudited)
|
(1)
|
|
Assets
|
|
|
|
Cash
|
$1,315,059
|
$829,933
|
|
Accounts receivable, net
|
27,526
|
33,575
|
|
Prepaid expense and other current assets
|
265,217
|
863,664
|
|
Inventories
|
640,055
|
599,856
|
|
Intangible assets & other non-current assets
|
5,429,548
|
5,900,350
|
|
Total
assets
|
$7,677,405
|
$8,227,378
|
|
|
|
|
|
Liabilities & Stockholders' Equity
|
|
|
|
Accounts payable and accrued expense
|
$1,356,057
|
$1,210,050
|
|
Total accrued compensation
|
2,733,091
|
2,299,593
|
|
Deferred revenue and customer deposits
|
-
|
11,000
|
|
Accrued interest payable
|
21,353
|
47,782
|
|
Total
notes payable and non-convertible debenture, net of
discount
|
780,056
|
681,127
|
|
Total derivative liabilities
|
74,151
|
483,744
|
|
Total contingent consideration
|
1,490,458
|
1,685,917
|
|
Convertible debentures, net of discount
|
-
|
714,192
|
|
Total stockholders' equity
|
1,222,239
|
1,093,973
|
|
Total
liabilities and stockholders’ equity
|
$7,677,405
|
$8,227,378
|
(1) The Condensed Consolidated Balance Sheet Data has been
derived from the audited consolidated financial statements as of
that date.
About Innovus Pharmaceuticals, Inc.
Headquartered in San Diego, Innovus Pharma is an emerging
OTC consumer goods and specialty pharmaceutical company engaged in
the commercialization, licensing and development of safe and
effective non-prescription medicine and consumer care products to
improve men’s and women’s health and vitality and
respiratory diseases. Innovus Pharma
delivers innovative and uniquely presented and packaged health
solutions through its (a) OTC medicines and consumer and health
products, which we market directly, (b) commercial partners to
primary care physicians, urologists, gynecologists and
therapists, and (c) directly to consumers through our on-line
channels, retailers and wholesalers. The Company is dedicated to be
a leader in developing and marketing new OTC and branded
Abbreviated New Drug Application (“ANDA”) products,
men’s and women’s health supplements, related
diagnostics and medical devices. The Company is actively pursuing
opportunities where existing prescription drugs have recently, or
are expected to, change from prescription (or Rx) to OTC, as well
as related products.
For
more information, go to www.innovuspharma.com;
www.zestra.com;
www.ejectdelay.com;
www.myvesele.com;
www.urivarx.com;
www.sensumplus.com;
www.myandroferti.com;
www.beyondhumantestosterone.com;
www.getbeyondhuman.com;
www.trybeyondhuman.com;
www.recalmax.com;
www.prostagorx.com;
www.fluticare.com;
www.allervarx.com;
and www.apeaz.com.
* Population data for Florida and Texas gathered from the 2010
Census Brief from the United States Census Bureau.
Innovus Pharma’s Forward-Looking Safe Harbor
Statements under the Private Securities Litigation Reform Act, as
amended: with the exception of the historical information contained
in this release, the matters described herein contain
forward-looking statements that involve risks and uncertainties
that may individually or mutually impact the matters herein
described for a variety of reasons that are outside the control of
the Company, including, but not limited to, its financial results,
projected revenues, projected online subscribers and other
customers, estimated markets for its products, and statements about
achieving its other corporate and business development, growth,
commercialization, financial and staffing objectives. Readers are
cautioned not to place undue reliance on these forward-looking
statements as actual results could differ materially from the
forward-looking statements contained herein. Readers are urged to
read the risk factors set forth in the Company's most recent filing
on Form S-1, annual report on Form 10-K, subsequent quarterly
reports filed on Form 10-Q and other filings made with the SEC.
Copies of these reports are available from the SEC's website or
without charge from the Company.
# #
#
Contact:
James
S. Painter, III
Emerging
Markets Consulting, LLC
Tel:
(407) 340-0226
jamespainter@emergingmarketsllc.com