Pacira Pharmaceuticals, Inc. Reports Third Quarter EXPAREL® Revenue of $20.0 Million and Full Third Quarter 2013 Financial Results

Company Will Host Conference Call Today at 9:00 a.m. ET

PARSIPPANY, N.J.--()--Pacira Pharmaceuticals, Inc. (NASDAQ:PCRX) today provided updates on the commercial success of EXPAREL® (bupivacaine liposome injectable suspension) for postsurgical pain in the United States and announced consolidated financial results for the quarter ended September 30, 2013.

“The strong third quarter for EXPAREL sales was accelerated by increased traction in orthopedic surgeries and infiltration into the transversus abdominis plane (or iTAP) procedures,” said Dave Stack, president, chief executive officer and chairman of Pacira. “Driven by strategic partnerships, specialized education and training, as well as new clinical evidence, we are changing the standard of care for postsurgical pain management across different surgical specialties and audiences.”

Recent Highlights

  • EXPAREL Commercialization: In the third quarter ended September 30, 2013, EXPAREL sales totaled $20.0 million, up from $15.2 million in the second quarter. Pacira continued its steady expansion of EXPAREL sales, reporting 297 total new accounts in the third quarter, an average of 23 new customers per week. As of September 30, 2013, 1,732 total accounts ordered EXPAREL since launch, with 165 accounts each ordering more than $100,000. The customer base has continued to grow along with acceptance and use of EXPAREL in hospitals that adopted the product early in the launch.
  • Data Continues to Shift the Pain Control Paradigm and Support the Utility of EXPAREL Among Surgeons and Anesthesiologists: As an increasing number of surgeons and anesthesiologists gain experience with EXPAREL, they are conducting and presenting their own independent findings across multiple surgical models. Last month, a 200-patient study evaluating the benefits of EXPAREL infiltration as the foundation of a multimodal postsurgical pain management regimen in patients undergoing total knee arthroplasty (TKA) versus femoral nerve block with a local anesthetic was presented at the 7th Annual Marshall Steele Orthopedic and Spine Summit in San Antonio. The study showed better pain control with improved knee flexion, shorter length of hospital stay and substantial cost savings among patients receiving EXPAREL.
  • Strategic Partnerships: Earlier this month, Pacira launched into a promotional, 5-year agreement with CrossLink Bioscience, LLC, an orthopedic device distributor based in Atlanta. With CrossLink acting as a local agent and lead partner in current collaboration with additional distributors in select markets across the United States, the arrangement allows Pacira to partner with several hundred orthopedic distributor representatives to promote and sell EXPAREL.

Third Quarter 2013 Financial Results

  • EXPAREL net product sales for the third quarter of 2013 totaled $20.0 million, a 340% increase compared to $4.6 million for the third quarter of 2012.
  • Total revenues for the third quarter of 2013 were $23.3 million, a 174% increase compared to $8.5 million for the third quarter of 2012.
  • Total operating expenses for the third quarter of 2013 were $36.1 million, compared to $24.2 million for the third quarter of 2012.
  • Net loss for the third quarter of 2013 was $14.8 million, or $0.44 per share, compared to $15.7 million, or $0.49 per share, for the third quarter of 2012.
  • Non-GAAP net loss was $10.0 million, or $0.30 per share, for the third quarter of 2013 compared to $14.0 million, or $0.43 per share, for the third quarter of 2012.
  • Pacira ended the third quarter of 2013 with cash and cash equivalents, restricted cash and short-term investments (“cash”) of $83.8 million.
  • As of September 30, 2013, the Company had approximately 33.5 million shares of common stock outstanding.

Today’s Conference Call and Webcast Reminder

The Pacira management team will host a conference call to discuss the company’s financial results and recent and upcoming developments today, Thursday, October 31, 2013, at 9 a.m. ET. The call can be accessed by dialing 1-866-318-8618 (domestic) or 1-617-399-5137 (international) five minutes prior to the start of the call and providing the passcode 26728091.

A replay of the call will be available approximately two hours after the completion of the call and can be accessed by dialing 1-888-286-8010 (domestic) or 1-617-801-6888 (international), and providing the passcode 62860661. The replay of the call will be available for two weeks from the date of the live call.

The live, listen-only webcast of the conference call can also be accessed by visiting the “Investors & Media” section of the company’s website at investor.pacira.com. A replay of the webcast will be archived on the Pacira website for two weeks following the call.

Non-GAAP Financial Information

This press release contains a financial measure, non-GAAP net loss, that does not comply with United States generally accepted accounting principles (GAAP) because it excludes stock-based compensation and other non-cash charges. This measure supplements our financial results prepared in accordance with GAAP. Pacira management uses this measure to better analyze its financial results and to help make managerial decisions. In management’s opinion, this non-GAAP measure is useful to investors and other users of our financial statements by providing greater transparency into the operating performance at Pacira. Such a measure should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. Such a non-GAAP net loss measure is also unlikely to be comparable with non-GAAP disclosures released by other companies. See a reconciliation of non-GAAP net loss to net loss below.

About Pacira

Pacira Pharmaceuticals, Inc. (NASDAQ: PCRX) is an emerging specialty pharmaceutical company focused on the clinical and commercial development of new products that meet the needs of acute care practitioners and their patients. The company’s current emphasis is the development of non-opioid products for postsurgical pain control, and its lead product, EXPAREL® (bupivacaine liposome injectable suspension), was commercially launched in the United States in April 2012. EXPAREL and two other products have utilized the Pacira proprietary product delivery technology DepoFoam®, a unique platform that encapsulates drugs without altering their molecular structure and then releases them over a desired period of time. Additional information about Pacira is available at www.pacira.com.

About EXPAREL®

EXPAREL (bupivacaine liposome injectable suspension) is indicated for single-dose infiltration into the surgical site to produce postsurgical analgesia. The product combines bupivacaine with DepoFoam, a proven product delivery technology that delivers medication over a desired time period. EXPAREL represents the first and only multivesicular liposome local anesthetic that can be utilized in the peri- or postsurgical setting in the same fashion as current local anesthetics. By utilizing the DepoFoam platform, a single dose of EXPAREL delivers bupivacaine over time, providing analgesia with reduced opioid requirements for up to 72 hours. Pivotal studies have demonstrated the safety and efficacy of EXPAREL in patients undergoing bunionectomy or hemorrhoidectomy procedures and additional studies are underway to further demonstrate the safety and efficacy in other procedures. Additional information is available at www.EXPAREL.com.

Important Safety Information

EXPAREL is contraindicated in obstetrical paracervical block anesthesia. EXPAREL has not been studied for use in patients younger than 18 years of age. Non-bupivacaine-based local anesthetics, including lidocaine, may cause an immediate release of bupivacaine from EXPAREL if administered together locally. The administration of EXPAREL may follow the administration of lidocaine after a delay of 20 minutes or more. Other formulations of bupivacaine should not be administered within 96 hours following administration of EXPAREL. Monitoring of cardiovascular and neurological status, as well as vital signs should be performed during and after injection of EXPAREL as with other local anesthetic products. Because amide-type local anesthetics, such as bupivacaine, are metabolized by the liver, EXPAREL should be used cautiously in patients with hepatic disease. Patients with severe hepatic disease, because of their inability to metabolize local anesthetics normally, are at a greater risk of developing toxic plasma concentrations. In clinical trials, the most common adverse reactions (incidence greater-than or equal to 10%) following EXPAREL administration were nausea, constipation, and vomiting.

Please see the full Prescribing Information for more details available at http://www.exparel.com/pdf/EXPAREL_Prescribing_Information.pdf.

Forward Looking Statements

Any statements in this press release about our future expectations, plans and prospects, including statements about our plans and expectations regarding EXPAREL, and other statements containing the words “believes,” “anticipates,” “plans,” “expects,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including risks relating to: the success of our sales and manufacturing efforts in support of the commercialization of EXPAREL; the rate and degree of market acceptance of EXPAREL; the size and growth of the potential markets for EXPAREL and our ability to serve those markets; our plans to expand the indications of EXPAREL to include nerve block, including the timing and success of an sNDA; our plans to continue to manufacture and provide support services for our commercial partners who have licensed DepoCyt(e); our commercialization and marketing capabilities; and other factors discussed in the “Risk Factors” of our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2012, and in other filings that we periodically make with the SEC. In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

Pacira Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets
(unaudited)
(in thousands)
         
September 30, December 31,
2013 2012
ASSETS
Current assets:
Cash and cash equivalents, restricted cash and short-term investments $ 83,822 $ 42,573
Accounts receivable, net 9,771 4,352
Inventories 15,606 12,077
Prepaid expenses and other current assets   2,486   1,920
Total current assets 111,685 60,922
Fixed assets, net 45,944 39,116
Goodwill 9,539 8,297
Intangibles, net 1,670 3,208
Other assets   3,557   511
Total assets $ 172,395 $ 112,054
LIABILITIES AND STOCKHOLDERS' EQUITY      
Current liabilities:
Accounts payable $ 1,559 $ 2,569
Accrued expenses 15,573 9,792
Convertible senior notes (*) 97,927 -
Current portion of royalty interest obligation 941 823
Current portion of deferred revenue   972   972
Total current liabilities 116,972 14,156
Long-term debt - 25,191
Royalty interest obligation 403 857
Deferred revenue 2,991 3,720
Other liabilities 2,911 2,275
Total stockholders' equity   49,118   65,855
Total liabilities and stockholders' equity $ 172,395 $ 112,054
 

(*) The convertible senior notes are contractually due in 2019. However, because of certain conditions that were met

during the three months ended September 30, 2013, the note holders can redeem any time during the quarter ended

December 31, 2013.

 
Pacira Pharmaceuticals, Inc.
Consolidated Statements of Operations
(unaudited)
(in thousands, except share and per share amounts)
                           
Three Months Ended Nine Months Ended
September 30, September 30,
2013 2012 2013 2012
Revenues:
Net product sales $ 22,408 $ 4,550 $ 49,520 $ 9,978
Collaborative licensing and development revenue 243 3,484 729 16,574
Royalty revenue   608     452     1,737     2,082  
Total revenues   23,259     8,486     51,986     28,634  
 
Operating expenses:
Cost of revenues 14,791 9,287 36,396 22,467
Research and development 5,962 3,527 16,724 6,693
Selling, general and administrative   15,320     11,378     42,336     32,943  
Total operating expenses   36,073     24,192     95,456     62,103  
Loss from operations   (12,814 )   (15,706 )   (43,470 )   (33,469 )
 
Other (expense) income:
Interest income 62 87 207 218
Interest expense (1,892 ) (456 ) (5,325 ) (1,464 )
Loss on early extinguishment of debt - - (3,398 ) (1,062 )
Royalty interest obligation (132 ) 378 (379 ) (47 )
Other, net   (8 )   (48 )   (30 )   (111 )
Total other expense, net   (1,970 )   (39 )   (8,925 )   (2,466 )
Loss before income taxes   (14,784 )   (15,745 )   (52,395 )   (35,935 )
Income tax benefit   -     -     442     -  
Net loss $ (14,784 ) $ (15,745 ) $ (51,953 ) $ (35,935 )
 
Net loss per share:
Basic and diluted net loss per common share $ (0.44 ) $ (0.49 ) $ (1.57 ) $ (1.21 )
Weighted average common shares outstanding:
Basic and diluted 33,359,576 32,436,207 33,050,721 29,585,716
 
Pacira Pharmaceuticals, Inc.
Reconciliation of GAAP to Non-GAAP Financial Information
(unaudited)
(in thousands, except share and per share amounts)
                             
Three Months Ended Nine Months Ended
September 30, September 30,
2013 2012 2013 2012
 
GAAP net loss $ (14,784 ) $ (15,745 ) $ (51,953 ) $ (35,935 )
 
Non-GAAP adjustments:
Stock-based compensation 3,777 1,469 8,227 3,220
Loss on extinguishment of debt - - 3,398 1,062
Non-cash debt discount amortization   1,035     260     2,924     571  
Total Non-GAAP adjustments $ 4,812   $ 1,729   $ 14,549   $ 4,853  
       
Non-GAAP net loss $ (9,972 ) $ (14,016 ) $ (37,404 ) $ (31,082 )
 
GAAP basic and diluted net loss per common share $ (0.44 ) $ (0.49 ) $ (1.57 ) $ (1.21 )
Non-GAAP basic and diluted net loss per common share $ (0.30 ) $ (0.43 ) $ (1.13 ) $ (1.05 )
 
Weighted average common shares outstanding - basic and diluted 33,359,576 32,436,207 33,050,721 29,585,716

Contacts

Pacira Pharmaceuticals, Inc.
Jessica Cho, 973-254-3574
or
Pure Communications, Inc.
Susan Heins, 864-286-9597

Release Summary

Pacira Pharmaceuticals, Inc. Reports Third Quarter EXPAREL® Revenue of $20.0 Million and Full Third Quarter 2013 Financial Results

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Contacts

Pacira Pharmaceuticals, Inc.
Jessica Cho, 973-254-3574
or
Pure Communications, Inc.
Susan Heins, 864-286-9597