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| 8-K - CURRENT REPORT - INNOVUS PHARMACEUTICALS, INC. | innv8k_apr22018.htm |
Exhibit 99.1
Innovus Pharmaceuticals Reports Record Annual Revenue for Fiscal
2017
of $8.8 Million, Preliminary Q1 2018 Revenue of $4.3 million to
$4.4 million and Expects to Exit 2018 Profitable
Year over Year Revenue Increase of 83% with Reduction in Net Loss
of 53% in 2017 and
Fiscal Year 2018 Net Revenue Annual Run Rate of At Least $18
million
SAN
DIEGO, April 2, 2018 – Innovus Pharmaceuticals, Inc.,
(“Innovus Pharma”) (OTCQB: INNV), today announced full
year 2017 net revenue of $8.8 million compared to $4.8 million in
revenue for the same period in 2016 and fourth quarter of 2017 net
revenue of $2.4 million compared to $1.7 million in revenue for the
same period in 2016.
Preliminary
first quarter 2018 net revenue is estimated to be between $4.3
million to $4.4 million or an approximate 85% increase from the
fourth quarter of 2017. Innovus Pharma's first
quarter 2018 anticipated revenue results are preliminary and based
on the most current information available and are subject to
completion of the consolidated financial statements for the first
quarter of 2018.
“We
have seen tremendous growth in our product pipeline and overall net
revenue during 2017 and the growth story continues into 2018 with
our record first quarter net revenue of an estimated $4.3 million
to $4.4 million. We believe our revenue growth into 2018 highlights
the continued strength of our ability to sell multiple products
through our Beyond Human®
sales and marketing platform and other sales channels,”
stated Bassam Damaj, President and Chief Executive Officer of
Innovus Pharma. “As we look forward to exiting 2018 as a
profitable Company when excluding non-cash expenses, we continue to
be focused on increasing annual revenue to at least $18 million by
executing on our goals of expanding our product lines and making
our products commercially available in the United States and
outside of the United States through our partners and new sales
channels, as well as achieving profitability.”
Financial highlights for the year ended December 31, 2017
included:
●
Net revenue totaled
$8.8 million for the year ended December 31, 2017 compared to net
revenue of $4.8 million for the year ended December 31, 2016
representing an increase of 83.0%.
●
Net revenue during
2017 was impacted by the natural disasters in Florida, Texas as
well as major holidays as the Company was unable to advertise its
products for a period of time in those regions and periods 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*.
●
Gross margins
increased to 79.0% for the year ended December 31, 2017, compared
to 77.5% for the year ended December 31, 2016.
●
Total operating
expense increased to $13.9 million and included $1.1 million in
non-cash share-based compensation for the year ended December 31,
2017.
●
Net loss totaled
$6.5 million, or $0.04 per common share, for the year ended
December 31, 2017 compared to a net loss of $13.7 million, or $0.15
per common share, for the year ended December 31, 2016 representing
a decrease of 52.5%. The net loss in 2017 included interest expense
of $0.9 million, of which $0.8 million was non-cash and related to
amortization of debt discounts. The net loss also included a
non-cash expense of $0.7 million for the loss on debt
extinguishment.
●
Cash balance
totaled $1.6 million at December 31, 2017 and current total cash on
hand is $4.7 million.
-1-
Financial highlights for the three months ended December 31, 2017
included:
●
Net revenues
totaled $2.4 million for the three months ended December 31, 2017
compared to net revenues of $1.7 million for the three months ended
December 31, 2016 representing a 40.7% increase.
●
Sequential quarter
over quarter revenue increase of 7.1% in the fourth quarter 2017
compared to a decrease of 10.1% in the fourth quarter
2016.
●
Gross margins
remained consistent at 78.2% for the three months ended December
31, 2017 and 2016.
●
Total operating
expenses increased to $3.5 million and included $0.1 million in
non-cash share-based compensation for the three months ended
December 31, 2017.
●
Loss from
operations decreased to $1.1 million during the three months ended
December 31, 2017 compared to $1.9 million during the three months
ended December 31, 2016 representing a 42.9% decrease.
●
Net loss totaled
$1.5 million, or $0.01 per common share, for the three months ended
December 31, 2017 compared to $3.4 million, or $0.03 per common
share, for the three months ended December 31, 2016 representing a
decrease of 55.5%. The net loss in 2017 included a non-cash expense
of $0.3 million for the loss on debt extinguishment. The net loss
also included interest expense of $0.1 million which was non-cash
and related to amortization of debt discounts.
Fourth quarter 2017 and recent developments:
●
Received our first commercial batch of 220,000
units of FlutiCare® in
October 2017 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 brought in-house the
Company’s product fulfillment and inventory storage process.
The move was 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;
●
Received net cash
proceeds of $2.7 million from the exercise of warrants to purchase
shares of the Company’s common stock, raised net cash
proceeds of $1.9 million from the issuance of notes payable during
the first quarter of 2018 and current total cash on hand is $4.7
million;
●
Entered into an
exclusive license and distribution agreement with Acerus
Pharmaceuticals in January 2018 granting them exclusive rights to
market and sell UriVarx® in Canada;
●
Entered into an
exclusive license and distribution agreement with Lavasta Pharma in
January 2018 granting them exclusive rights to market and sell
ProstaGorx® in various countries in the Middle East and North
Africa;
●
Launched six new
products; and
●
Received multiple
product approvals in Canada.
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: 9576665. 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:
10118224. The replay will be available shortly after the end of the
conference call.
-2-
Consolidated
Statements of Operations
|
|
Three months
ended
|
Year
ended
|
||
|
|
December
31,
|
December
31,
|
||
|
|
2017
|
2016
|
2017
|
2016
|
|
|
(unaudited)
|
|
||
|
Net
revenue:
|
|
|
|
|
|
Product
sales, net
|
$2,379,510
|
$1,691,491
|
$8,806,300
|
$4,817,603
|
|
License
revenue
|
-
|
-
|
10,000
|
1,000
|
|
Total
net revenue
|
2,379,510
|
1,691,491
|
8,816,300
|
4,818,603
|
|
|
|
|
|
|
|
Operating
expense:
|
|
|
|
|
|
Cost of
product sales
|
519,194
|
368,810
|
1,848,325
|
1,083,094
|
|
Research
and development
|
11,829
|
30,137
|
38,811
|
77,804
|
|
Sales
and marketing
|
1,983,842
|
1,363,879
|
6,853,559
|
3,621,045
|
|
General
and administrative
|
966,928
|
1,858,215
|
5,174,827
|
5,870,572
|
|
Total
operating expense
|
3,481,793
|
3,621,041
|
13,915,522
|
10,652,515
|
|
|
|
|
|
|
|
Loss from
operations
|
(1,102,283)
|
(1,929,550)
|
(5,099,222)
|
(5,833,912)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income and
(expense):
|
|
|
|
|
|
Interest
expense
|
(100,281)
|
(660,942)
|
(872,166)
|
(6,661,694
|
|
Loss on
extinguishment of debt
|
(305,891)
|
-
|
(700,060)
|
-
|
|
Other
income (expense), net
|
(1,256)
|
(190)
|
(6,878)
|
1,649
|
|
Fair
value adjustment for contingent consideration
|
(1,425)
|
(1,464,638)
|
194,034
|
(1,269,857)
|
|
Change
in fair value of derivative liabilities
|
15,542
|
697,687
|
(16,596)
|
65,060
|
|
Total
other expense, net
|
(393,311)
|
(1,428,083)
|
(1,401,666)
|
(7,864,842)
|
|
|
|
|
|
|
|
Loss before
provision for income taxes
|
$(1,495,594)
|
(3,357,633)
|
(6,500,888)
|
(13,698,754)
|
|
|
|
|
|
|
|
Provision for
income taxes
|
-
|
2,400
|
3,200
|
2,400
|
|
|
|
|
|
|
|
Net
loss
|
$(1,495,594)
|
$(3,360,033)
|
$(6,504,088)
|
$(13,701,154)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share
of common stock – basic and diluted:
|
$(0.01)
|
$(0.03)
|
$(0.04)
|
$(0.15)
|
|
|
|
|
|
|
|
Weighted average
number of shares of common stock outstanding – basic and
diluted
|
174,575,366
|
116,765,431
|
157,933,458
|
94,106,382
|
|
|
|
|
|
|
|
|
|
|
||
-3-
Condensed Consolidated Balance Sheet Data
|
|
December 31,
2017
|
December 31,
2016
|
|
|
1
|
1
|
|
Assets
|
|
|
|
Cash
|
$1,564,859
|
$829,933
|
|
Accounts
receivable, net
|
68,259
|
33,575
|
|
Prepaid
expenses and other current assets
|
363,080
|
863,664
|
|
Inventories
|
1,725,698
|
599,856
|
|
Intangible
assets and other non-current assets
|
5,309,010
|
5,900,350
|
|
Total
assets
|
$9,030,906
|
$8,227,378
|
|
Liabilities
& Stockholders' Equity
|
|
|
|
Accounts
payable & accrued liabilities
|
$2,607,121
|
$1,210,050
|
|
Total
accrued compensation
|
2,650,197
|
2,299,593
|
|
Deferred
revenue and customer deposits
|
24,690
|
11,000
|
|
Accrued
interest payable
|
3,648
|
47,782
|
|
Short-term
loans payable
|
65,399
|
-
|
|
Notes
payable and non-convertible debenture, net of discount
|
1,239,296
|
681,127
|
|
Total
derivative liabilities
|
58,609
|
483,744
|
|
Total
contingent consideration
|
1,479,003
|
1,685,917
|
|
Convertible
debentures, net of discount
|
-
|
714,192
|
|
Total
stockholders' equity
|
902,943
|
1,093,973
|
|
Total
liabilities & stockholders' equity
|
$9,030,906
|
$8,227,378
|
1 The Condensed Consolidated Balance Sheet Data has been
derived from the audited consolidated financial statements as of
that date.
-4-
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
being a leader in developing and marketing new OTC and branded
Abbreviated New Drug Application (“ANDA”) products. The
Company is actively pursuing opportunities where existing
prescription drugs have recently, or are expected to, change from
prescription (or Rx) to OTC.
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.
# #
#
For more information, please contact:
Randy
Berholtz
Innovus
Pharma Investor Relations
Tel: +1
858 249 7865
ir@innovuspharma.com
-5-