Full Press Release Details
Aytu BioPharma Reports Third Quarter 2022 Financial Results and Outlines Key Strategic Priorities
Quarterly Net Revenue Increased 79% Year-Over-Year to $24.2 Million, the Highest
Revenue in Company History
Strategic Priorities Focused on Driving Revenue Growth, Increasing Financial Efficiencies and
Performance and Preparing Pipeline for Long-term Value Creation
Englewood, CO, May 16, 2022 - Aytu BioPharma, Inc. (Nasdaq: AYTU), a pharmaceutical company focused on developing and commercializing novel therapeutics, today reported financial results for its fiscal 2022 third quarter, ended March 31, 2022 and outlined its key strategic priorities.
"In our fiscal third quarter and throughout 2022, we continued to make solid progress in growing our commercial businesses and developing our product candidate pipeline, and the operational improvements we've implemented following the Neos acquisition are being realized," said Josh Disbrow, chief executive officer of Aytu BioPharma. "We've identified three key areas of strategic focus for our organization in the near-term - executing and growing our base business, enhancing our operational efficiencies, and preparing to advance a pipeline that addresses significant areas of medical need - all of which we believe will drive Aytu's long-term growth and success. To date, we've demonstrated growth of the prescription portfolio with an integrated, streamlined sales force, and our consumer division posted its highest revenue quarter in company history. With our ongoing plan to gain manufacturing efficiencies, we expect to see increased gross margins on our commercial-stage ADHD products, and, following that, we'll be well positioned to improve profitability across our commercial business to help fund our pipeline advancements. We've continued to advance our AR101 and Healight programs, which are aimed at treating life-threatening conditions for which there are no or very few available treatment options. To execute against these objectives, we are dedicated to building a strong, value-driven organization comprised of high-performing, talented individuals who are committed to serving patients and caregivers who are in need of new therapeutic solutions for rare and complex conditions."
Key Strategic Operational Priorities
Fiscal Third Quarter 2022 Financial Results
Annual Shareholder Meeting
Mr. Disbrow and Mark Oki, chief financial officer of Aytu, will present a corporate update at its Virtual Annual Meeting of Shareholders, scheduled for May 18, 2022 at 10:00 AM Mountain Time. The meeting will be accessible at www.virtualshareholdermeeting.com/AYTU2022AM.
About Aytu BioPharma, Inc.
Aytu BioPharma is a pharmaceutical company with a portfolio of commercial prescription therapeutics and consumer health products, and a growing therapeutics pipeline focused on treating rare, pediatric-onset disorders. The company's prescription products include Adzenys XR-ODT (amphetamine) extended-release orally disintegrating tablets (see Full Prescribing Information, including Boxed WARNING) and Cotempla XR-ODT (methylphenidate) extended-release orally disintegrating tablets (see Full Prescribing Information, including Boxed WARNING) for the treatment of attention deficit hyperactivity disorder (ADHD), as well as Karbinal ER (carbinoxamine maleate), an extended-release antihistamine suspension containing carbinoxamine indicated to treat numerous allergic conditions, and Poly-Vi-Flor and Tri-Vi-Flor , two complementary fluoride-based prescription vitamin product lines in various formulations for infants and children with fluoride deficiency. Aytu is also building a therapeutic pipeline, which includes AR101 (enzastaurin), a PKC inhibitor in development for the treatment of Vascular Ehlers-Danlos Syndrome (VEDS). VEDS is a rare genetic disease typically diagnosed in childhood resulting in high morbidity and a significantly shortened lifespan, and for which there are no currently approved treatments. AR101 has received Orphan Drug designation and Fast Track designation from the U.S. Food and Drug Administration and has received Orphan Drug designation from the European Commission. Aytu is also researching and advancing the development of the Healight ultraviolet light A (UVA) endotracheal catheter, a patented, investigational medical device with potential application in the treatment of severe, difficult-to-treat respiratory infections. To learn more, please visit aytubio.com.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, or the Exchange Act. All statements other than statements of historical facts contained in this press release, are forward-looking statements. Forward-looking statements are generally written in the future tense and/or are preceded by words such as ''may,'' ''will,'' ''should,'' ''forecast,'' ''could,'' ''expect,'' ''suggest,'' ''believe,'' ''estimate,'' ''continue,'' ''anticipate,'' ''intend,'' ''plan,'' or similar words, or the negatives of such terms or other variations on such terms or comparable terminology. Forward-looking statements, including but not limited to any statements regarding the financial results and statements presented in this press release. These statements are just predictions and are subject to risks and uncertainties that could cause the actual events or results to differ materially. These risks and uncertainties include, among others: the ability to attract and retain key management team members, the future growth potential of our commercial portfolio, the anticipated start dates, durations and completion dates and the potential safety and efficacy of our product candidates AR101 and Healight. We also refer you to the risks described in ''Risk Factors'' in Aytu's Annual and Quarterly Reports on Form 10-K and 10-Q and in the other reports and documents it files with the Securities and Exchange Commission.
THRUST Strategic Communications
1 Aytu uses the term EBITDA or Earnings Before Interest, Income Taxes, Depreciation and Amortization, which is a term not defined under United States Generally Accepted Accounting Principles. The Company uses this term because it is a widely accepted financial indicator utilized to analyze and compare companies on the basis of operating performance. The Company believes that presenting EBITDA adjusted to exclude expenses related to development of its AR101 and Healight development programs and impairment expenses and non-cash adjustments (Adjusted EBITDA) provides information to evaluate the Company's ongoing commercial activities. See reconciliation of Adjusted EBITDA to net income in table set forth below. The Company's method of computation of EBITDA may or may not be comparable to other similarly titled measures used by other companies.
AYTU BIOPHARMA, INC.
Condensed Consolidated Statements of Operations
(In thousands, except share and per-share)
| Three Months Ended | Nine Months Ended | |||||||||||
| March 31, | March 31, | |||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||
| Product revenue, net | $ | 24,199 | $ | 13,483 | $ | 69,221 | $ | 42,150 | ||||
| Cost of sales | 11,513 | 13,935 | 31,780 | 24,249 | ||||||||
| Gross profit | 12,686 | (452) | 37,441 | 17,901 | ||||||||
| Operating expenses | ||||||||||||
| Research and development | 3,726 | 390 | 10,742 | 859 | ||||||||
| Selling and marketing | 9,743 | 6,597 | 28,700 | 18,128 | ||||||||
| General and administrative | 7,615 | 6,001 | 23,784 | 16,948 | ||||||||
| Acquisition related costs | - | 1,537 | - | 2,849 | ||||||||
| Restructuring costs | - | 4,818 | - | 4,875 | ||||||||
| Impairment expense | 45,196 | 4,286 | 64,649 | 4,286 | ||||||||
| Amortization of intangible assets | 1,061 | 1,585 | 3,214 | 4,754 | ||||||||
| Total operating expenses | 67,341 | 25,214 | 131,089 | 52,699 | ||||||||
| Loss from operations | (54,655) | (25,666) | (93,648) | (34,798) | ||||||||
| Other income (expense) | ||||||||||||
| Other income/(expense), net | (55) | (425) | (75) | (1,555) | ||||||||
| Gain (loss) from contingent consideration | 1,257 | 631 | 761 | (2,680) | ||||||||
| Gain (loss) on extinguishment of debt | 169 | - | 169 | (258) | ||||||||
| Gain on derivative warrant liability | 211 | - | 211 | - | ||||||||
| Total other expense | 1,582 | 206 | 1,066 | (4,493) | ||||||||
| Loss before income tax | (53,073) | (25,460) | (92,582) | (39,291) | ||||||||
| Income tax benefit | - | - | (110) | - | ||||||||
| Net loss | $ | (53,073) | $ | (25,460) | $ | (92,472) | $ | (39,291) | ||||
| Weighted average number of common shares outstanding | 29,689,856 | 18,092,465 | 27,211,708 | 14,490,219 | ||||||||
| Basic and diluted net loss per common share | $ | (1.79) | $ | (1.41) | $ | (3.40) | $ | (2.71) |
AYTU BIOPHARMA, INC.
Condensed Consolidated Balance Sheets
(In thousands, except share and per-share)
| (Unaudited) | ||||||
| March 31, | June 30, | |||||
| 2022 | 2021 | |||||
| Assets | ||||||
| Current assets | ||||||
| Cash and cash equivalents | $ | 27,613 | $ | 49,649 | ||
| Restricted cash | - | 252 | ||||
| Accounts receivable, net | 27,613 | 28,176 | ||||
| Inventory, net | 13,891 | 16,339 | ||||
| Prepaid expenses | 7,942 | 9,780 | ||||
| Other current assets | 888 | 1,038 | ||||
| Total current assets | 77,947 | 105,234 | ||||
| Property and equipment, net | 3,479 | 5,140 | ||||
| Operating lease right-of-use asset | 3,561 | 3,563 | ||||
| Intangible assets, net | 74,428 | 85,464 | ||||
| Goodwill | 8,637 | 65,802 | ||||
| Other non-current assets | 774 | 465 | ||||
| Total non-current assets | 90,879 | 160,434 | ||||
| Total assets | $ | 168,826 | $ | 265,668 | ||
| Liabilities | ||||||
| Current liabilities | ||||||
| Accounts payable and other | $ | 11,130 | $ | 19,255 | ||
| Accrued liabilities | 53,470 | 51,295 | ||||
| Accrued compensation | 5,258 | 5,939 | ||||
| Short-term line of credit | 3,385 | 7,934 | ||||
| Current portion of debt | 100 | 16,668 | ||||
| Current portion of operating lease liabilities | 1,203 | 940 | ||||
| Current portion of fixed payment arrangements | 2,903 | 3,134 | ||||
| Current portion of CVR liabilities | 156 | 218 | ||||
| Current portion of contingent consideration | - | 4,055 | ||||
| Other current liabilities | 2,755 | - | ||||
| Total current liabilities | 80,360 | 109,438 | ||||
| Debt, net of current portion | 14,167 | 180 | ||||
| Operating lease liabilities, net of current portion | 2,406 | 2,624 | ||||
| Fixed payment arrangements, net of current portion | 4,237 | 6,324 | ||||
| CVR liabilities, net of current portion | 564 | 1,177 | ||||
| Contingent consideration, net of current portion | 371 | 8,002 | ||||
| Other non-current liabilities | 5,577 | 355 | ||||
| Total liabilities | 107,682 | 128,100 | ||||
| Commitments and contingencies | ||||||
| Stockholders' equity | ||||||
| Preferred Stock, par value $.0001; 50,000,000 shares authorized; no shares issued or outstanding as of March 31, 2022 and June 30, 2021 | - | - | ||||
| Common Stock, par value $.0001; 200,000,000 shares authorized; shares issued and outstanding 33,355,935 and 27,490,412, respectively, as of March 31, 2022 and June 30, 2021 | 3 | 3 | ||||
| Additional paid-in capital | 331,912 | 315,864 | ||||
| Accumulated deficit | (270,771) | (178,299) | ||||
| Total stockholders' equity | 61,144 | 137,568 | ||||
| Total liabilities and stockholders' equity | $ | 168,826 | $ | 265,668 |
AYTU BIOPHARMA, INC.
Reconciliation of GAAP to Non-GAAP Financial Information
| Three Months Ended | ||||
| March 31, 2022 | ||||
| Reconciliation of net loss to Adjusted EBITDA: | ||||
| Net loss | $ | (53,073) | ||
| Addback: | ||||
| Research and development - AR101 & Healight | 2,943 | |||
| Depreciation and Amortization | 2,447 | |||
| Impairment expense | 45,196 | |||
| Stock based compensation | 1,201 | |||
| Interest expense | 831 | |||
| Other income | (776) | |||
| Gain from contingent considerations | (1,257) | |||
| Gain on extinguishment of debt | (169) | |||
| Gain on derivative warrant liability | (211) | |||
| Adjusted EBITDA | $ | (2,868) |