Full Press Release Details
ANI Pharmaceuticals Reports First Quarter 2020 Results and
Appoints Interim CEO
For the first quarter 2020, ANI reports:
Integrates Amerigen Pharmaceuticals, Ltd. portfolio
Launches five generic products increasing total commercialized
product line to 60 product families
Appoints Patrick D. Walsh interim President and CEO
Suspends guidance for 2020
Baudette, Minnesota (May 7, 2020) - ANI Pharmaceuticals,
Inc. ("ANI") (NASDAQ: ANIP) today reported its financial results for the three months ended March 31, 2020. The
Company will host its earnings conference call this morning, May 7, 2020, at 10:30 AM ET. Investors and other interested parties
can join the call by dialing (866) 776-8875. The conference ID is 5243607.
| (in thousands, except per share data) | Q1 2020 | Q1 2019 | ||||||
| Net revenues | $ | 49,774 | $ | 52,887 | ||||
| Net (loss)/income | $ | (7,011 | ) | $ | 449 | |||
| GAAP (loss)/earnings per diluted share | $ | (0.59 | ) | $ | 0.04 | |||
| Adjusted non-GAAP EBITDA (a) | $ | 17,554 | $ | 22,299 | ||||
| Adjusted non-GAAP diluted earnings per share (b) | $ | 1.04 | $ | 1.30 |
(a) See Table 3 for US GAAP reconciliation.
(b) See Table 4 for US GAAP reconciliation.
Arthur S. Przybyl, President and CEO, stated,
"ANI generated net revenues and non-GAAP earnings
that met management's expectations during a period that was marked by significant uncertainties due to the COVID-19 pandemic.
Our performance during this period is a testament to the commitment of our employees and to the strength of the business that we
have built. I am proud of the accomplishments that were made during my eleven-year tenure as CEO of ANI. During this time, we have
built ANI from a small private company to a thriving public specialty pharmaceutical business with an increasing diverse commercial
product offering and an incredibly valuable pipeline opportunity in Cortrophin Gel. As I depart ANI, I am confident that I
leave the business in good health, in the hands of a very strong management team, and with its best days ahead of it. I welcome
Patrick Walsh from the Board of Directors to the role of interim CEO and trust in his ability to lead the Company until such time
as my replacement is identified."
Appoints Interim CEO
As previously announced, Mr. Przybyl will depart as President
and CEO on May 10, 2020. The Board of Directors of ANI (BOD) has appointed Patrick D. Walsh interim President and CEO, effective
May 11, 2020, until such time that Mr. Przybyl's permanent replacement is hired. Mr. Walsh has served on the ANI BOD since
2018 and has extensive pharmaceutical industry experience. For Mr. Walsh's complete bio, please refer to ANI's proxy
statement filed on April 23, 2020. The BOD has retained nationally recognized executive search firm Heidrick & Struggles and
is currently conducting the search for a President and CEO.
Continues Expansion of Commercialized Product Portfolio
During the first quarter of 2020, we successfully integrated
the Amerigen Pharmaceuticals, Ltd. U.S. product portfolio, which was purchased in January for $52.5 million. This transaction increased
our commercialized generic product portfolio by nine products from 35 to 44 and increased our pipeline portfolio by an additional
thirteen opportunities. In addition, we launched five generic products during the quarter, further expanding our generic offerings
to 49, and our total commercialized offerings including brands to 60.
First Quarter Results
| Net Revenues (in thousands) | Three Months Ended March 31, | |||||||||||||||
| 2020 | 2019 | Change | % Change | |||||||||||||
| Generic pharmaceutical products | $ | 37,495 | $ | 31,599 | $ | 5,896 | 19 | % | ||||||||
| Branded pharmaceutical products | 9,157 | 17,543 | (8,386 | ) | (48 | )% | ||||||||||
| Contract manufacturing | 1,974 | 2,437 | (463 | ) | (19 | )% | ||||||||||
| Royalty and other income | 1,148 | 1,308 | (160 | ) | (12 | )% | ||||||||||
| Total net revenues | $ | 49,774 | $ | 52,887 | $ | (3,113 | ) | (6 | )% |
Generic Pharmaceutical Products
Net revenues for generic pharmaceutical products were $37.5 million
during the three months ended March 31, 2020, an increase of 19% compared to $31.6 million for the same period in 2019. The
primary drivers of the increase are the September 2019 launch of Vancomycin Oral Solution and the January 2020 launch of Miglustat,
Mixed Amphetamine Salts, Penicillamine and Paliperidone, all products acquired in January from Amerigen Pharmaceuticals, Ltd.
("Amerigen"). These increases were tempered by decreases in sales of Vancomycin capsules, Esterified Estrogen with
Methyltestosterone ("EEMT"), Erythromycin Ethylsuccinate ("EES"), and Ezetimibe Simvastatin.
Branded Pharmaceutical Products
Net revenues for branded pharmaceutical products were $9.2 million
during the three months ended March 31, 2020, a decrease of 48% compared to $17.5 million for the same period in 2019. The primary
reasons for the decrease were lower unit sales of Inderal XL, Inderal LA and Atacand as well as decreased sales of Arimidex.
Contract Manufacturing
Contract manufacturing revenues were $2.0 million during
the three months ended March 31, 2020, a decrease of 19% compared to $2.4 million for the same period in 2019, due to the timing
and volume of orders from contract manufacturing customers in the period.
Royalty and other were $1.1 million during the three months
ended March 31, 2020, a decrease of $0.2 million from $1.3 million for the same period in 2019, primarily due to a decrease in
royalty and laboratory service revenues, tempered by increases in product development revenues earned by ANI Canada during the
three months ended March 31, 2020.
Operating expenses increased to $57.6 million for the three
months ended March 31, 2020, from $48.5 million in the prior year period. The increase was primarily due to the following:
These increases were tempered by a $4.9 million decrease in
depreciation and amortization expense, primarily due to the non-reoccurrence of amortization expense recorded in relation to the
January 2019 royalty buy out, partially offset by the amortization of the Abbreviated New Drug Applications and marketing and distribution
rights acquired in January 2020 from Amerigen.
Cost of sales exclusive of the $2.7 million net impact related
to the excess of fair value over the cost of inventory sold during the period as a percentage of net revenues increased to 38%
during the three months ended March 31, 2020, from 28% during same period in 2019, primarily as a result of a shift in product
mix to an increased volume of generic products, which have lower average selling prices, inventory reserve charges in the current
quarter as well as increased sales of products subject to profit-sharing arrangements during the current quarter.
Net Loss and Diluted Loss per Share
Net loss was $7.0 million for the three months ended March 31,
2020, as compared to net income of $0.4 million in the prior year period. The effective consolidated tax benefit rate for the three
months ended March 31, 2020 was 29.7%.
Diluted loss per share for the three months ended March 31,
2020 was $0.59, based on 11,902 thousand diluted shares outstanding, as compared to diluted earnings per share of $0.04 in the
prior year period. Adjusted non-GAAP diluted earnings per share was $1.04, as compared to adjusted non-GAAP diluted earnings per
share of $1.30 in the prior year period. For a reconciliation of adjusted non-GAAP diluted earnings per share to the most directly
comparable GAAP financial measure, please see Table 4.
Cortrophin Gel Re-commercialization Update
| Product | Required Filing | Total Annual Market (c) |
| Cortrophin Gel | sNDA | $950 million |
(c) Based on data from IQVIA
ANI filed the sNDA for Cortrophin Gel re-commercialization
on March 23, 2020, on track with our long-standing publicly projected Q1 2020 target filing date. The FDA initially set a PDUFA
goal date of July 23, 2020, however as announced on April 29, 2020, subsequently issued a Refusal to File (RTF) letter. ANI will
request a Type-A meeting with the FDA in order to discuss the deficiencies identified in the RTF letter and our plan to address
each of them. In addition, significant accomplishments since the fourth quarter 2020 press release (dated February 27, 2020) include:
For further details, please see ANI's Cortrophin
Gel Re-commercialization Milestone Update in Table 5.
ANI Guidance for the Full Year 2020
Due to inherent uncertainties regarding the duration and impact
of the coronavirus (COVID-19) pandemic, ANI is suspending its previously announced 2020 financial guidance.
ANI Product Development Pipeline
ANI's pipeline consists of 116 products, addressing a
total annual market size of $5.8 billion, based on data from IQVIA. Of these, ANI expects that at least 52 can be commercialized
based on either CBE-30s or prior approval supplements filed with the FDA.
Non-GAAP Financial Measures
Adjusted non-GAAP EBITDA
ANI's management considers adjusted non-GAAP EBITDA to
be an important financial indicator of ANI's operating performance, providing investors and analysts with a useful measure