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Avadel Pharmaceuticals Reports Second Quarter 2018 Financial Results
Mr. Anderson continued, “We are just a few months into the launch of NOCTIVA, and although net revenue to date is just under
“Additionally, we continue to improve recruitment efforts for our REST-ON Phase III trial of our investigational FT 218 drug in patients with narcolepsy. As we enter the second half of this year, we are approximately 50% enrolled. With the FDA’s recent agreement to allow the inclusion of a select group of former sodium oxybate users, we have initiated a database review program across our clinical sites. We have also implemented a new patient referral program and, over the next few months, we will be adding seven new clinical sites in the U.S., and three in
Overview of second quarter 2018 financial results:
Revenues: | ||||||||
Three Months Ended June 30, | ||||||||
($ in 000s) By Product | 2018 | 2017 | ||||||
Bloxiverz | $ | 5,544 | $ | 13,719 | ||||
Vazculep | 11,377 | 10,154 | ||||||
Akovaz | 11,875 | 20,912 | ||||||
Noctiva | 289 | — | ||||||
Other | 31 | 2,320 | ||||||
Product sales | 29,116 | 47,105 | ||||||
License revenue | 114 | (794 | ) | |||||
Total revenues | $ | 29,230 | $ | 46,311 | ||||
Revenues for the second quarter 2018 were
Operating expenses: | ||||||||
Three Months Ended June 30, | ||||||||
($ in 000s) Operating expenses | 2018 | 2017 | ||||||
Cost of products | $ | 3,512 | $ | 4,561 | ||||
Research and development expenses (R&D) | 11,890 | 6,792 | ||||||
Selling, general and administrative expenses (SG&A) | 27,843 | 12,429 | ||||||
R&D expense was up 75% in the second quarter 2018 compared to the prior year period, primarily due to increased spend on the Phase III REST-ON trial. The
GAAP earnings: | |||||||
Three Months Ended June 30, | |||||||
($ in 000s except for per share) | 2018 | 2017 | |||||
Net (loss) income | $ | (3,438 | ) | $ | 28,927 | ||
Net (loss) income per share - diluted | (0.09 | ) | 0.68 | ||||
Included in GAAP net loss for the second quarter 2018 were gains of
Adjusted earnings (1): | ||||||||
Three Months Ended June 30, | ||||||||
($ in 000s except for per share) | 2018 | 2017 | ||||||
Net (loss) income | $ | (20,261 | ) | $ | 8,165 | |||
Net (loss) income per share - diluted | (0.55 | ) | 0.19 | |||||
(1) Descriptions of Avadel’s non-GAAP financial measures are included under the caption Non-GAAP Disclosures and Adjustments included within this press release and reconciliations of such non-GAAP financial measures to their most closely applicable GAAP financial measures are found in the Supplemental Information section herein. | ||||||||
The decrease in adjusted net income is largely attributable to lower revenues from the Company’s hospital products and higher SG&A due to the 2018 launch of Noctiva. Please see the Supplemental Information section within this document for a reconciliation of adjusted net income and adjusted diluted EPS to the respective GAAP amounts.
2018 Guidance:
The Company maintained its full year 2018 spend guidance for R&D of between
Conference Call:
A conference call to discuss these results has been scheduled for
About
Safe Harbor: This press release may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The words “will,” “may,” “believe,” “expect,” “anticipate,” “estimate,” “project” and similar expressions, and the negatives thereof, identify forward-looking statements, each of which speaks only as of the date the statement is made. Although we believe that our forward-looking statements are based on reasonable assumptions within the bounds of our knowledge of our business and operations, our business is subject to significant risks and as a result there can be no assurance that actual results of our research, development and commercialization activities and our results of operations will not differ materially from the results contemplated in such forward-looking statements. These risks include: (i) risks relating to our exchangeable senior notes including use of the net proceeds from the offering of the notes and other future events related to the notes; (ii) risks relating to the divestiture of our former pediatric business including whether such divestiture will be accretive to our operating income and cash flow; (iii) risks relating to our license agreement with
Non-GAAP Disclosures and Adjustments
Avadel discloses certain non-GAAP financial measures, including adjusted net income and loss and adjusted net income and loss per diluted share, as management believes that such non-GAAP financial measures can enhance an overall understanding of the Company’s financial performance when considered together with financial measures prepared in accordance with generally accepted accounting principles (GAAP) in the U.S. In addition to reporting its financial results in accordance with GAAP, Avadel reports certain non-GAAP results that exclude, if any, fair value remeasurements of its contingent consideration, amortization of debt discount and debt issuance costs attributable to our exchangeable notes, impairment of intangible assets, if any, amortization of intangible assets, restructuring costs, if any, foreign exchange gains and losses on assets and liabilities denominated in foreign currencies, unrealized gains/losses on marketable equity securities, but includes the cash payments plus any unpaid accrued cash payments associated with the contingent consideration and cash interest payments or related accruals on the exchangeable notes. The Company's management uses these non-GAAP measures internally for forecasting, budgeting and measuring its operating performance. Investors and other readers should review the related GAAP financial measures and the reconciliation of non-GAAP measures to their most closely comparable GAAP measure set forth below and should consider non-GAAP measures only as a supplement to, not as a substitute for or as a superior measure to, measures of financial performance prepared in accordance with GAAP. The table provided within the following “Supplemental Information” section reconciles GAAP net income and loss and diluted earnings or loss per share to the corresponding adjusted amounts.
Contacts: | Michael F. Kanan |
Chief Financial Officer | |
Phone: (636) 449-1844 | |
Email: mkanan@avadel.com | |
Lauren Stival | |
Sr. Director, Investor Relations & Corporate Communications | |
Phone: (636) 449-5866 | |
Email: lstival@avadel.com | |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(In thousands, except per share data)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Revenues: | ||||||||||||||||
Product sales | $ | 29,116 | $ | 47,105 | $ | 62,277 | $ | 98,862 | ||||||||
License revenue | 114 | (794 | ) | 246 | (44 | ) | ||||||||||
Total revenues | 29,230 | 46,311 | 62,523 | 98,818 | ||||||||||||
Operating expenses: | ||||||||||||||||
Cost of products | 3,512 | 4,561 | 10,104 | 8,463 | ||||||||||||
Research and development expenses | 11,890 | 6,792 | 21,841 | 13,998 | ||||||||||||
Selling, general and administrative expenses | 27,843 | 12,429 | 52,330 | 24,241 | ||||||||||||
Intangible asset amortization | 1,609 | 564 | 3,376 | 1,128 | ||||||||||||
Gain - changes in fair value of related party contingent consideration | (12,889 | ) | (13,230 | ) | (9,921 | ) | (20,201 | ) | ||||||||
Restructuring costs | 50 | 1,069 | 203 | 3,722 | ||||||||||||
Total operating expenses | 32,015 | 12,185 | 77,933 | 31,351 | ||||||||||||
Operating (loss) income | (2,785 | ) | 34,126 | (15,410 | ) | 67,467 | ||||||||||
Investment and other income (expense), net | 583 | 764 | 637 | 1,585 | ||||||||||||
Interest expense, net | (2,980 | ) | (263 | ) | (4,577 | ) | (526 | ) | ||||||||
Other income - changes in fair value of related party payable | 1,402 | 1,670 | 1,007 | 2,220 | ||||||||||||
(Loss) income before income taxes | (3,780 | ) | 36,297 | (18,343 | ) | 70,746 | ||||||||||
Income tax (benefit) provision | (342 | ) | 7,370 | (2,669 | ) | 15,909 | ||||||||||
Net (loss) income | $ | (3,438 | ) | $ | 28,927 | $ | (15,674 | ) | $ | 54,837 | ||||||
Net (loss) income per share - basic | $ | (0.09 | ) | $ | 0.70 | $ | (0.42 | ) | $ | 1.33 | ||||||
Net (loss) income per share - diluted | (0.09 | ) | 0.68 | (0.42 | ) | 1.29 | ||||||||||
Weighted average number of shares outstanding - basic | 36,772 | 41,091 | 37,666 | 41,233 | ||||||||||||
Weighted average number of shares outstanding - diluted | 36,772 | 42,487 | 37,666 | 42,625 |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
June 30, 2018 | December 31, 2017 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 12,477 | $ | 16,564 | ||||
Marketable securities | 134,629 | 77,511 | ||||||
Accounts receivable | 14,940 | 14,785 | ||||||
Inventories | 5,724 | 6,157 | ||||||
Prepaid expenses and other current assets | 7,206 | 8,958 | ||||||
Total current assets | 174,976 | 123,975 | ||||||
Property and equipment, net | 2,439 | 3,001 | ||||||
Goodwill | 18,491 | 18,491 | ||||||
Intangible assets, net | 70,962 | 92,289 | ||||||
Research and development tax credit receivable | 6,124 | 5,272 | ||||||
Other non-current assets | 22,244 | 10,249 | ||||||
Total assets | $ | 295,236 | $ | 253,277 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt | $ | 108 | $ | 111 | ||||
Current portion of long-term related party payable | 14,067 | 25,007 | ||||||
Accounts payable | 11,169 | 7,477 | ||||||
Deferred revenue | 1,724 | 2,007 | ||||||
Accrued expenses | 21,493 | 50,926 | ||||||
Other current liabilities | 3,052 | 1,011 | ||||||
Total current liabilities | 51,613 | 86,539 | ||||||
Long-term debt, less current portion | 113,038 | 156 | ||||||
Long-term related party payable, less current portion | 38,050 | 73,918 | ||||||
Other non-current liabilities | 13,989 | 7,084 | ||||||
Total liabilities | 216,690 | 167,697 | ||||||
Shareholders’ equity: | ||||||||
Preferred shares, $0.01 nominal value; 50,000 shares authorized at June 30, 2018 and December 31, 2017, respectively; none issued or outstanding at June 30, 2018 and December 31, 2017, respectively | — | — | ||||||
Ordinary shares, nominal value of $0.01; 500,000 shares authorized; 42,148 issued and 36,740 outstanding at June 30, 2018 and 41,463 issued and 39,346 outstanding at December 31, 2017 | 421 | 414 | ||||||
Treasury shares, at cost, 5,408 and 2,117 shares held at June 30, 2018 and December 31, 2017, respectively | (49,998 | ) | (22,361 | ) | ||||
Additional paid-in capital | 430,141 | 393,478 | ||||||
Accumulated deficit | (278,359 | ) | (262,685 | ) | ||||
Accumulated other comprehensive loss | (23,659 | ) | (23,266 | ) | ||||
Total shareholders’ equity | 78,546 | 85,580 | ||||||
Total liabilities and shareholders’ equity | $ | 295,236 | $ | 253,277 | ||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
Cash flows from operating activities: | |||||||
Net (loss) income | $ | (15,674 | ) | $ | 54,837 | ||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 3,810 | 1,611 | |||||
Amortization of premiums on marketable securities | 1,693 | 34 | |||||
Foreign exchange loss | (160 | ) | 1,304 | ||||
Remeasurement of related party acquisition-related contingent consideration | (9,921 | ) | (20,201 | ) | |||
Remeasurement of related party financing-related contingent consideration | (1,007 | ) | (2,220 | ) | |||
Amortization of debt discount and debt issuance costs | 2,019 | — | |||||
Change in deferred tax and income tax deferred charge | (3,247 | ) | 322 | ||||
Stock-based compensation expense | 4,358 | 4,055 | |||||
Other adjustments | 251 | (115 | ) | ||||
Net changes in assets and liabilities | |||||||
Accounts receivable | (157 | ) | (1,446 | ) | |||
Inventories | (242 | ) | (2,489 | ) | |||
Prepaid expenses and other current assets | 1,587 | (264 | ) | ||||
Research and development tax credit receivable | (1,003 | ) | (1,175 | ) | |||
Accounts payable & other current liabilities | 5,206 | 4,931 | |||||
Accrued expenses | (9,831 | ) | 12,747 | ||||
Earn-out payments for related party contingent consideration in excess of acquisition-date fair value | (11,113 | ) | (16,515 | ) | |||
Royalty payments for related party payable in excess of original fair value | (1,618 | ) | (2,287 | ) | |||
Other assets and liabilities | (2,893 | ) | 407 | ||||
Net cash (used in) provided by operating activities | (37,942 | ) | 33,536 | ||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (99 | ) | (321 | ) | |||
Purchase of intangible asset | (20,000 | ) | — | ||||
Proceeds from sales of marketable securities | 253,525 | 51,820 | |||||
Purchases of marketable securities | (312,638 | ) | (67,743 | ) | |||
Net cash used in investing activities | (79,212 | ) | (16,244 | ) | |||
Cash flows from financing activities: | |||||||
Earn-out payments for related party contingent consideration | (645 | ) | (665 | ) | |||
Proceeds from debt issuance | 143,750 | — | |||||
Payments for debt issuance costs | (5,760 | ) | — | ||||
Share repurchases | (27,637 | ) | (13,081 | ) | |||
Cash proceeds from the issuance of ordinary shares and warrants | 3,446 | 376 | |||||
Other financing activities, net | 6 | 12 | |||||
Net cash provided by (used in) financing activities | 113,160 | (13,358 | ) | ||||
Effect of foreign currency exchange rate changes on cash and cash equivalents | (93 | ) | 358 | ||||
Net change in cash and cash equivalents | (4,087 | ) | 4,292 | ||||
Cash and cash equivalents at January 1, | 16,564 | 39,215 | |||||
Cash and cash equivalents at June 30, | $ | 12,477 | $ | 43,507 |
UNAUDITED SUPPLEMENTAL INFORMATION
(In thousands, except per share data)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Revenues by Product: | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Bloxiverz | $ | 5,544 | $ | 13,719 | $ | 13,035 | $ | 27,621 | ||||||||
Vazculep | 11,377 | 10,154 | 24,338 | 20,334 | ||||||||||||
Akovaz | 11,875 | 20,912 | 22,092 | 46,549 | ||||||||||||
Noctiva | 289 | — | 955 | — | ||||||||||||
Other | 31 | 2,320 | 1,857 | 4,358 | ||||||||||||
Total product sales | 29,116 | 47,105 | 62,277 | 98,862 | ||||||||||||
License revenue | 114 | (794 | ) | 246 | (44 | ) | ||||||||||
Total revenues | $ | 29,230 | $ | 46,311 | $ | 62,523 | $ | 98,818 | ||||||||
GAAP to Non-GAAP adjustments for the three-months ended June 30, 2018 | |||||||||||||||||||||||||||||||||||||||
Exclude | Include | ||||||||||||||||||||||||||||||||||||||
GAAP | Intangible asset amortization |
Foreign exchange (gain)/loss |
Restructuring impacts |
Equity securities unrealized (gain)/loss impact |
Amortization of debt discount and debt issuance costs |
Contingent related party payable fair value remeasurements |
Contingent related party payable paid/accrued |
Total adjustments |
Adjusted GAAP | ||||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||||||
Product sales | $ | 29,116 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 29,116 | |||||||||||||||||||
License revenue | 114 | — | — | — | — | — | — | — | — | 114 | |||||||||||||||||||||||||||||
Total revenues | 29,230 | — | — | — | — | — | — | — | — | 29,230 | |||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||||||
Cost of products | 3,512 | — | — | — | — | — | — | — | — | 3,512 | |||||||||||||||||||||||||||||
Research and development expenses | 11,890 | — | — | — | — | — | — | — | — | 11,890 | |||||||||||||||||||||||||||||
Selling, general and administrative expenses | 27,843 | — | — | — | — | — | — | — | — | 27,843 | |||||||||||||||||||||||||||||
Intangible asset amortization | 1,609 | (1,609 | ) | — | — | — | — | — | — | (1,609 | ) | — | |||||||||||||||||||||||||||
Loss (gain) - changes in fair value of related party contingent consideration |
(12,889 | ) | — | — | — | — | — | 12,889 | 5,060 | 17,949 | 5,060 | ||||||||||||||||||||||||||||
Restructuring costs | 50 | — | — | (50 | ) | — | — | — | — | (50 | ) | — | |||||||||||||||||||||||||||
Total operating expenses | 32,015 | (1,609 | ) | — | (50 | ) | — | — | 12,889 | 5,060 | 16,290 | 48,305 | |||||||||||||||||||||||||||
Operating (loss) income | (2,785 | ) | 1,609 | — | 50 | — | — | (12,889 | ) | (5,060 | ) | (16,290 | ) | (19,075 | ) | ||||||||||||||||||||||||
Investment and other income (expense), net |
583 | — | 7 | — | (112 | ) | — | — | — | (105 | ) | 478 | |||||||||||||||||||||||||||
Interest expense, net | (2,980 | ) | — | — | — | — | 1,363 | — | — | 1,363 | (1,617 | ) | |||||||||||||||||||||||||||
Other expense (income) - changes in fair value of related party payable |
1,402 | — | — | — | — | — | (1,402 | ) | (751 | ) | (2,153 | ) | (751 | ) | |||||||||||||||||||||||||
(Loss) income before income taxes |
(3,780 | ) | 1,609 | 7 | 50 | (112 | ) | 1,363 | (14,291 | ) | (5,811 | ) | (17,185 | ) | (20,965 | ) | |||||||||||||||||||||||
Income tax (benefit) provision | (342 | ) | 338 | — | — | (2 | ) | — | (471 | ) | (227 | ) | (362 | ) | (704 | ) | |||||||||||||||||||||||
Net (loss) income | $ | (3,438 | ) | $ | 1,271 | $ | 7 | $ | 50 | $ | (110 | ) | $ | 1,363 | $ | (13,820 | ) | $ | (5,584 | ) | $ | (16,823 | ) | $ | (20,261 | ) | |||||||||||||
Net income (loss) per share - diluted(1) | $ | (0.09 | ) | $ | 0.03 | $ | — | $ | — | $ | — | $ | 0.04 | $ | (0.38 | ) | $ | (0.15 | ) | $ | (0.46 | ) | $ | (0.55 | ) | ||||||||||||||
Weighted average number of shares outstanding - diluted |
36,772 | 36,772 | 36,772 | 36,772 | 36,772 | 36,772 | 36,772 | 36,772 | 36,772 | 36,772 |
(1) Net income (loss) per share - diluted is calculated by dividing Net income (loss) by the Weighted average number of shares outstanding - diluted. Note, when recalculated using this method, the balances in the Total adjustment and Adjusted GAAP columns may not cross-foot as a result of rounding to full precision.
GAAP to Non-GAAP adjustments for the three-months ended June 30, 2017 | |||||||||||||||||||||||||||||||||||
Exclude | Include | ||||||||||||||||||||||||||||||||||
GAAP | Intangible asset amortization |
Foreign exchange (gain)/loss |
Restructuring impacts |
License revenue adjustment |
Contingent related party payable fair value remeasurements |
Contingent related party payable paid/accrued |
Total adjustments |
Adjusted GAAP |
|||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||
Product sales | $ | 47,105 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 47,105 | |||||||||||||||||
License revenue | (794 | ) | — | — | — | 1,100 | — | — | 1,100 | 306 | |||||||||||||||||||||||||
Total revenues | 46,311 | — | — | — | 1,100 | — | — | 1,100 | 47,411 | ||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||
Cost of products | 4,561 | — | — | — | — | — | — | — | 4,561 | ||||||||||||||||||||||||||
Research and development expenses | 6,792 | — | — | — | — | — | — | — | 6,792 | ||||||||||||||||||||||||||
Selling, general and administrative expenses | 12,429 | — | — | — | — | — | — | — | 12,429 | ||||||||||||||||||||||||||
Intangible asset amortization | 564 | (564 | ) | — | — | — | — | — | (564 | ) | — | ||||||||||||||||||||||||
Loss (gain) - changes in fair value of related party contingent consideration | (13,230 | ) | — | — | — | — | 13,230 | 8,516 | 21,746 | 8,516 | |||||||||||||||||||||||||
Restructuring costs | 1,069 | — | — | (1,069 | ) | — | — | — | (1,069 | ) | — | ||||||||||||||||||||||||
Total operating expenses | 12,185 | (564 | ) | — | (1,069 | ) | — | 13,230 | 8,516 | 20,113 | 32,298 | ||||||||||||||||||||||||
Operating (loss) income | 34,126 | 564 | — | 1,069 | 1,100 | (13,230 | ) | (8,516 | ) | (19,013 | ) | 15,113 | |||||||||||||||||||||||
Investment and other income (expense), net | 764 | — | (237 | ) | — | — | — | — | (237 | ) | 527 | ||||||||||||||||||||||||
Interest expense, net | (263 | ) | — | — | — | — | — | — | — | (263 | ) | ||||||||||||||||||||||||
Other expense (income) - changes in fair value of related party payable | 1,670 | — | — | — | — | (1,670 | ) | (1,166 | ) | (2,836 | ) | (1,166 | ) | ||||||||||||||||||||||
(Loss) income before income taxes | 36,297 | 564 | (237 | ) | 1,069 | 1,100 | (14,900 | ) | (9,682 | ) | (22,086 | ) | 14,211 | ||||||||||||||||||||||
Income tax (benefit) provision | 7,370 | 201 | — | — | — | (909 | ) | (616 | ) | (1,324 | ) | 6,046 | |||||||||||||||||||||||
Net (loss) income | $ | 28,927 | $ | 363 | $ | (237 | ) | $ | 1,069 | $ | 1,100 | $ | (13,991 | ) | $ | (9,066 | ) | $ | (20,762 | ) | $ | 8,165 | |||||||||||||
Net income (loss) per share - diluted(1) | $ | 0.68 | $ | 0.01 | $ | (0.01 | ) | $ | 0.03 | $ | 0.03 | $ | (0.33 | ) | $ | (0.21 | ) | $ | (0.49 | ) | $ | 0.19 | |||||||||||||
Weighted average number of shares outstanding - diluted | 42,487 | 42,487 | 42,487 | 42,487 | 42,487 | 42,487 | 42,487 | 42,487 | 42,487 |
(1) Net income (loss) per share - diluted is calculated by dividing Net income (loss) by the Weighted average number of shares outstanding - diluted. Note, when recalculated using this method, the balances in the Total adjustment and Adjusted GAAP columns may not cross-foot as a result of rounding to full precision.
GAAP to Non-GAAP adjustments for the six-months ended June 30, 2018 | |||||||||||||||||||||||||||||||||||||||
Exclude | Include | ||||||||||||||||||||||||||||||||||||||
GAAP | Intangible asset amortization |
Foreign exchange (gain)/loss |
Restructuring impacts |
Equity securities unrealized (gain)/loss impact |
Amortization of debt discount and debt issuance costs |
Contingent related party payable fair value remeasurements |
Contingent related party payable paid/accrued |
Total adjustments |
Adjusted GAAP |
||||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||||||
Product sales | $ | 62,277 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 62,277 | |||||||||||||||||||
License revenue | 246 | — | — | — | — | — | — | — | — | 246 | |||||||||||||||||||||||||||||
Total revenues | 62,523 | — | — | — | — | — | — | — | — | 62,523 | |||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||||||
Cost of products | 10,104 | — | — | — | — | — | — | — | — | 10,104 | |||||||||||||||||||||||||||||
Research and development expenses | 21,841 | — | — | — | — | — | — | — | — | 21,841 | |||||||||||||||||||||||||||||
Selling, general and administrative expenses | 52,330 | — | — | — | — | — | — | — | — | 52,330 | |||||||||||||||||||||||||||||
Intangible asset amortization | 3,376 | (3,376 | ) | — | — | — | — | — | — | (3,376 | ) | — | |||||||||||||||||||||||||||
Loss (gain) - changes in fair value of related party contingent consideration | (9,921 | ) | — | — | — | — | — | 9,921 | 10,850 | 20,771 | 10,850 | ||||||||||||||||||||||||||||
Restructuring costs | 203 | — | — | (203 | ) | — | — | — | — | (203 | ) | — | |||||||||||||||||||||||||||
Total operating expenses | 77,933 | (3,376 | ) | — | (203 | ) | — | — | 9,921 | 10,850 | 17,192 | 95,125 | |||||||||||||||||||||||||||
Operating (loss) income | (15,410 | ) | 3,376 | — | 203 | — | — | (9,921 | ) | (10,850 | ) | (17,192 | ) | (32,602 | ) | ||||||||||||||||||||||||
Investment and other income (expense), net | 637 | — | (160 | ) | — | 186 | — | — | — | 26 | 663 | ||||||||||||||||||||||||||||
Interest expense, net | (4,577 | ) | — | — | — | — | 2,019 | — | — | 2,019 | (2,558 | ) | |||||||||||||||||||||||||||
Other expense (income) - changes in fair value of related party payable | 1,007 | — | — | — | — | — | (1,007 | ) | (1,548 | ) | (2,555 | ) | (1,548 | ) | |||||||||||||||||||||||||
(Loss) income before income taxes | (18,343 | ) | 3,376 | (160 | ) | 203 | 186 | 2,019 | (10,928 | ) | (12,398 | ) | (17,702 | ) | (36,045 | ) | |||||||||||||||||||||||
Income tax (benefit) provision | (2,669 | ) | 709 | — | — | (5 | ) | — | (348 | ) | (473 | ) | (117 | ) | (2,786 | ) | |||||||||||||||||||||||
Net (loss) income | $ | (15,674 | ) | $ | 2,667 | $ | (160 | ) | $ | 203 | $ | 191 | $ | 2,019 | $ | (10,580 | ) | $ | (11,925 | ) | $ | (17,585 | ) | $ | (33,259 | ) | |||||||||||||
Net income (loss) per share - diluted(1) | $ | (0.42 | ) | $ | 0.07 | $ | — | $ | 0.01 | $ | 0.01 | $ | 0.05 | $ | (0.28 | ) | $ | (0.32 | ) | $ | (0.47 | ) | $ | (0.88 | ) | ||||||||||||||
Weighted average number of shares outstanding - diluted | 37,666 | 37,666 | 37,666 | 37,666 | 37,666 | 37,666 | 37,666 | 37,666 | 37,666 | 37,666 | |||||||||||||||||||||||||||||
GAAP to Non-GAAP adjustments for the six-months ended June 30, 2017 | ||||||||||||||||||||||||||||||||||||||
Exclude | Include | |||||||||||||||||||||||||||||||||||||
GAAP | Intangible asset amortization |
Foreign exchange (gain)/loss |
Restructuring impacts |
Purchase accounting adjustments - FSC |
License revenue adjustment |
Contingent related party payable fair value remeasurements |
Contingent related party payable paid/accrued |
Total adjustments |
Adjusted GAAP |
|||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Product sales | $ | 98,862 | $ | — | $ | — | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 98,862 | |||||||||||||||||||
License revenue | (44 | ) | — | — | — | — | 1,100 | — | — | 1,100 | 1,056 | |||||||||||||||||||||||||||
Total revenues | 98,818 | — | — | — | — | 1,100 | — | — | 1,100 | 99,918 | ||||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||
Cost of products | 8,463 | — | — | — | (46 | ) | — | — | — | (46 | ) | 8,417 | ||||||||||||||||||||||||||
Research and development expenses | 13,998 | — | — | — | — | — | — | — | — | 13,998 | ||||||||||||||||||||||||||||
Selling, general and administrative expenses | 24,241 | — | — | — | — | — | — | — | — | 24,241 | ||||||||||||||||||||||||||||
Intangible asset amortization | 1,128 | (1,128 | ) | — | — | — | — | — | — | (1,128 | ) | — | ||||||||||||||||||||||||||
Loss (gain) - changes in fair value of related party contingent consideration | (20,201 | ) | — | — | — | — | — | 20,201 | 18,132 | 38,333 | 18,132 | |||||||||||||||||||||||||||
Restructuring costs | 3,722 | — | — | (3,722 | ) | — | — | — | — | (3,722 | ) | — | ||||||||||||||||||||||||||
Total operating expenses | 31,351 | (1,128 | ) | — | (3,722 | ) | (46 | ) | — | 20,201 | 18,132 | 33,437 | 64,788 | |||||||||||||||||||||||||
Operating (loss) income | 67,467 | 1,128 | — | 3,722 | 46 | 1,100 | (20,201 | ) | (18,132 | ) | (32,337 | ) | 35,130 | |||||||||||||||||||||||||
Investment and other income (expense), net | 1,585 | — | (6 | ) | — | — | — | — | — | (6 | ) | 1,579 | ||||||||||||||||||||||||||
Interest expense, net | (526 | ) | — | — | — | — | — | — | — | — | (526 | ) | ||||||||||||||||||||||||||
Other expense (income) - changes in fair value of related party payable | 2,220 | — | — | — | — | — | (2,220 | ) | (2,465 | ) | (4,685 | ) | (2,465 | ) | ||||||||||||||||||||||||
(Loss) income before income taxes | 70,746 | 1,128 | (6 | ) | 3,722 | 46 | 1,100 | (22,421 | ) | (20,597 | ) | (37,028 | ) | 33,718 | ||||||||||||||||||||||||
Income tax (benefit) provision | 15,909 | 402 | — | — | 17 | — | (1,269 | ) | (1,307 | ) | (2,157 | ) | 13,752 | |||||||||||||||||||||||||
Net (loss) income | $ | 54,837 | $ | 726 | $ | (6 | ) | 3,722 | $ | 29 | $ | 1,100 | $ | (21,152 | ) | $ | (19,290 | ) | $ | (34,871 | ) | $ | 19,966 | |||||||||||||||
Net income (loss) per share - diluted(1) | $ | 1.29 | $ | 0.02 | $ | — | 0.09 | $ | — | $ | 0.03 | $ | (0.50 | ) | $ | (0.45 | ) | $ | (0.82 | ) | $ | 0.47 | ||||||||||||||||
Weighted average number of shares outstanding - diluted | 42,625 | 42,625 | 42,625 | 42,625 | 42,625 | 42,625 | 42,625 | 42,625 | 42,625 | 42,625 |
(1) Net income (loss) per share - diluted is calculated by dividing Net income (loss) by the Weighted average number of shares outstanding - diluted. Note, when recalculated using this method, the balances in the Total adjustment and Adjusted GAAP columns may not cross-foot as a result of rounding to full precision.