BEDFORD, Mass.--(BUSINESS WIRE)--Anika Therapeutics, Inc. (NASDAQ: ANIK), a leader in products for tissue protection, healing, and repair based on hyaluronic acid (HA) technology, today reported financial results for the second quarter ended June 30, 2015, along with business progress in the period.
“The solid results we delivered in the second quarter demonstrate accelerating demand, which combined with our tangible pipeline progress, positions Anika to deliver robust growth for many years,” stated Charles H. Sherwood, Ph.D., President and Chief Executive Officer. “As in recent quarters, physician and patient demand for our homegrown orthobiologics products continued to gain traction, and was the highlight of our commercial results. We expect that trend to continue with the launch of two important orthopedic products in the coming years, which will provide an important catalyst for additional value creation.”
Second Quarter Financial Results
- Product revenue was up 8 percent in 2015.
- At the end of the quarter, ORTHOVISC and MONOVISC achieved a combined 26 percent share of the U.S. viscosupplementation market. ORTHOVISC continues to grow and is maintaining its market-leading position in the multi-injection segment. MONOVISC experienced accelerated growth, and now holds the number two position in the single-injection segment.
- Total revenue for the second quarter of 2015 was $22.9 million. In last year’s second quarter, the Company reported $5 million in milestone revenue from the first commercial sale of MONOVISC in the U.S., resulting in total revenue of $26.3 million.
- Total operating expenses for the second quarter of 2015 were $10.5 million compared with $11.1 million in the second quarter of 2014. The decrease was primarily driven by lower SG&A expenses as a result of the full amortization of certain intangible assets at the end of 2014.
- Net income for the second quarter was $7.8 million, or $0.51 per diluted share, compared with $9.3 million, or $0.60 per diluted share, for the second quarter of 2014. Last year’s results included $5 million in milestone revenue as a result of the first commercial sale of MONOVISC in the U.S. Excluding the impact of this milestone revenue, net income and diluted EPS increased $1.6 million, and $0.11, respectively.
Recent Business Highlights
The Company continues to make solid headway in expanding the commercial reach of existing products and advancing the progress of products in its development pipeline. Recent highlights of the business include:
- Agreements with new partners in India and Australia for the commercialization of MONOVISC.
- Submission and approval of an investigational device exemption (IDE) to evaluate the utility of MONOVISC, the Company’s single-injection product, in treating hip pain associated with osteoarthritis. The study is sponsored by Anika's exclusive U.S. commercial partner for MONOVISC, and is expected to commence patient enrollment in the U.S. before the end of this year.
- Positive results from a 242-patient study evaluating the safety of a repeat injection of CINGAL, the first viscosupplement to combine the HA formulation found in MONOVISC with a steroid into a single injection to treat pain and reduce inflammation caused by osteoarthritis. The results of this follow-up study combined with the initial Phase 3 data suggest that CINGAL retains an excellent safety profile as an initial injection as well as a repeat injection. CINGAL is currently progressing through the regulatory process in the U.S., Europe, and Canada.
- Approval of a HYALOFAST IDE by the U.S. FDA. HYALOFAST, a biodegradable 3D scaffold that enables cartilage regeneration, has been used in more than 6,000 patients outside of the U.S. via a non-invasive, single-step arthroscopic procedure. HYALOFAST is commercially available in 18 countries. With approval of this IDE, the Company is on track to commence patient enrollment at sites in the United States and Europe beginning in the fourth quarter of 2015.
During the quarter, Anika further established its commitment to developing the next generation of orthopedic medicine, announcing a multiyear research collaboration with the University of Massachusetts (UMass) Amherst to develop a novel treatment for rheumatoid arthritis (RA). This partnership combines Anika’s proprietary HA technology with UMass Amherst’s preclinical research and scientific expertise with the goal to develop the first localized therapy for RA that is cost-effective and can have a systemic impact on a large patient population with currently limited treatment options.
Conference Call Information
Anika management will hold a conference call and webcast to discuss its financial results, business highlights and financial outlook tomorrow, Thursday, July 30th at 9:00 am ET. The conference call can be accessed by dialing 1-855-468-0611 (toll-free domestic) or 1-484-756-4332 (international). A live audio webcast will be available in the "Investor Relations" section of Anika’s website, www.anikatherapeutics.com. An accompanying slide presentation may also be accessed via the Anika website. A replay of the webcast will be available on Anika’s website approximately two hours after the completion of the event.
About Anika Therapeutics, Inc.
Headquartered in Bedford, Mass., Anika Therapeutics, Inc. develops, manufactures, and commercializes therapeutic products for tissue protection, healing, and repair. These products are based on hyaluronic acid (HA), a naturally occurring, biocompatible polymer found throughout the body. Anika's products range from orthopedic/joint health solutions led by ORTHOVISC and MONOVISC, treatments for osteoarthritis, to surgical aids in the anti-adhesion and ophthalmic fields. The Company also offers aesthetic dermal fillers for the correction of facial wrinkles. Anika's Italian subsidiary, Anika Therapeutics S.r.l., provides complementary HA products in orthopedic/joint health and anti-adhesion, as well as therapeutics in areas such as advanced wound treatment and ear, nose and throat care. Its regenerative technology advances Anika's vision to offer therapeutic products and medical solutions that go beyond pain relief to protect and restore damaged tissue.
Forward-Looking Statements
The statements made in the second paragraph of this press release, as well as the second and fourth bullet points and final paragraph of the section captioned “Recent Business Highlights,” which are not statements of historical fact, are 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, as amended. These statements include, but are not limited to, those relating to the company’s product pipeline and growth opportunities, the enrollment of patients in the Company’s clinical studies, and the objective of the Company’s partnership with UMass Amherst. These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks, uncertainties, and other factors. The Company’s actual results could differ materially from any anticipated future results, performance, or achievements described in the forward-looking statements as a result of a number of factors including (i) the Company’s ability to successfully commence and/or complete clinical trials of its products, including for HYALOFAST or for expanded indications of the Company’s MONOVISC product, on a timely basis or at all; (ii) the Company’s ability to obtain pre-clinical or clinical data to support domestic and international pre-market approval applications or 510(k) applications, or to timely file and receive FDA or other regulatory approvals or clearances of its products; (iii) that such approvals will not be obtained in a timely manner or without the need for additional clinical trials, other testing or regulatory submissions, as applicable; (iv) the Company’s research and product development efforts and their relative success, including whether we have any meaningful sales of any new products resulting from such efforts; (v) the cost effectiveness and efficiency of the Company’s clinical studies, manufacturing operations and production planning; (vi) the strength of the economies in which the Company operate or will be operating, as well as the political stability of any of those geographic areas; (vii) future determinations by the Company to allocate resources to products and in directions not presently contemplated; (viii) the Company’s ability to successfully commercialize its products, in the U.S. and abroad; (ix) the Company’s ability to provide an adequate and timely supply of its products to its customers; (x) the Company’s ability to continue to successfully manage Anika Therapeutics S.r.l.’s business; and (xi) the Company’s ability to achieve its growth targets.
| Anika Therapeutics, Inc. and Subsidiaries | ||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||
| (unaudited) | ||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2015 | 2014 | 2015 | 2014 | |||||||||
| Product revenue | $ | 22,898,032 | $ | 21,267,156 | $ | 38,412,714 | $ | 35,618,561 | ||||
| Licensing, milestone and contract revenue | 5,529 | 5,007,504 | 11,171 | 24,666,386 | ||||||||
| Total revenue | 22,903,561 | 26,274,660 | 38,423,885 | 60,284,947 | ||||||||
| Operating expenses: | ||||||||||||
| Cost of product revenue | 5,274,059 | 5,332,913 | 9,587,499 | 9,693,932 | ||||||||
| Research & development | 1,812,320 | 1,873,158 | 3,910,082 | 4,160,873 | ||||||||
| Selling, general & administrative | 3,388,494 | 3,865,876 | 6,993,155 | 7,356,861 | ||||||||
| Total operating expenses | 10,474,873 | 11,071,947 | 20,490,736 | 21,211,666 | ||||||||
| Income from operations | 12,428,688 | 15,202,713 | 17,933,149 | 39,073,281 | ||||||||
| Interest income, net | 23,907 | 5,935 | 47,630 | 6,402 | ||||||||
| Income before income taxes | 12,452,595 | 15,208,648 | 17,980,779 | 39,079,683 | ||||||||
| Provision for income taxes | 4,633,038 | 5,906,298 | 6,645,665 | 14,747,080 | ||||||||
| Net income | $ | 7,819,557 | $ | 9,302,350 | $ | 11,335,114 | $ | 24,332,603 | ||||
| Basic net income per share: | ||||||||||||
| Net income | $ | 0.52 | $ | 0.63 | $ | 0.76 | $ | 1.67 | ||||
| Basic weighted average common shares outstanding | 14,961,436 | 14,687,747 | 14,933,534 | 14,559,917 | ||||||||
| Diluted net income per share: | ||||||||||||
| Net income | $ | 0.51 | $ | 0.60 | $ | 0.74 | $ | 1.57 | ||||
| Diluted weighted average common shares outstanding | 15,335,687 | 15,492,732 | 15,332,391 | 15,487,432 | ||||||||
| Anika Therapeutics, Inc. and Subsidiaries | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (unaudited) | ||||||||
| June 30, | December 31, | |||||||
| ASSETS | 2015 | 2014 | ||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 103,920,222 | $ | 100,155,864 | ||||
| Investments | 18,513,150 | 6,750,000 | ||||||
| Accounts receivable, net of reserves of $133,820 and $146,618 at June 30, 2015 and December 31,2014, respectively | 19,166,116 | 17,152,028 | ||||||
| Inventories | 11,718,243 | 12,406,776 | ||||||
| Prepaid income taxes | - | 412,301 | ||||||
| Current portion deferred income taxes | 1,459,867 | 1,188,768 | ||||||
| Prepaid expenses and other | 947,939 | 959,305 | ||||||
| Total current assets | 155,725,537 | 139,025,042 | ||||||
| Property and equipment, at cost | 54,671,505 | 53,619,589 | ||||||
| Less: accumulated depreciation | (23,148,636 | ) | (21,950,706 | ) | ||||
| 31,522,869 | 31,668,883 | |||||||
| Long-term deposits and other | 69,016 | 69,042 | ||||||
| Intangible assets, net | 13,083,907 | 14,894,710 | ||||||
| Goodwill | 7,610,821 | 8,338,699 | ||||||
| Total Assets | $ | 208,012,150 | $ | 193,996,376 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,657,683 | $ | 1,201,226 | ||||
| Accrued expenses | 4,441,785 | 4,747,526 | ||||||
| Deferred revenue | 35,938 | 24,510 | ||||||
| Income taxes payable | 1,821,898 | - | ||||||
| Total current liabilities | 7,957,304 | 5,973,262 | ||||||
| Other long-term liabilities | 779,666 | 893,935 | ||||||
| Long-term deferred revenue | 74,371 | 102,192 | ||||||
| Deferred tax liability | 8,633,398 | 8,929,890 | ||||||
| Commitments and contingencies | - | - | ||||||
| Stockholders’ equity: | ||||||||
| Preferred stock, $.01 par value; 1,250,000 shares authorized, no shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively | - | - | ||||||
| Common stock, $.01 par value; 30,000,000 shares authorized, 15,003,694 and 14,851,703 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively | 150,037 | 148,517 | ||||||
| Additional paid-in-capital | 80,505,021 | 77,539,699 | ||||||
| Accumulated other comprehensive loss | (6,326,442 | ) | (4,494,800 | ) | ||||
| Retained earnings | 116,238,795 | 104,903,681 | ||||||
| Total stockholders’ equity | 190,567,411 | 178,097,097 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 208,012,150 | $ | 193,996,376 | ||||
| Anika Therapeutics, Inc. and Subsidiaries | ||||||||||||||||||||
| Supplemental Financial Data | ||||||||||||||||||||
| Revenue by Product Line and Product Gross Margin | ||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||
| Quarter Ended June 30, | 6 Months Ended June 30, | |||||||||||||||||||
| 2015 | % | 2014 | % | 2015 | % | 2014 | % | |||||||||||||
| Orthobiologics | $ | 19,282,919 | 84% | $ | 18,278,254 | 86% | $ | 31,255,419 | 81% | $ | 29,850,404 | 84% | ||||||||
| Dermal | 303,117 | 1% | 348,961 | 2% | 719,300 | 2% | 537,612 | 1% | ||||||||||||
| Surgical | 1,647,005 | 7% | 1,376,530 | 6% | 3,036,600 | 8% | 3,128,549 | 9% | ||||||||||||
| Ophthalmic | 414,991 | 2% | 363,411 | 2% | 919,463 | 2% | 571,996 | 2% | ||||||||||||
| Veterinary | 1,250,000 | 6% | 900,000 | 4% | 2,481,932 | 7% | 1,530,000 | 4% | ||||||||||||
| Total Product Revenue | $ | 22,898,032 | 100% | $ | 21,267,156 | 100% | $ | 38,412,714 | 100% | $ | 35,618,561 | 100% | ||||||||
| Product gross profit | $ | 17,623,973 | $ | 15,934,243 | $ | 28,825,215 | $ | 25,924,629 | ||||||||||||
| Product gross margin | 77% | 75% | 75% | 73% | ||||||||||||||||
| Total Product Revenue by Geographic Region | ||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||
| Quarter Ended June 30, | 6 Months Ended June 30, | |||||||||||||||||||
| 2015 | % | 2014 | % | 2015 | % |
|
2014 | % | ||||||||||||
|
Geographic Location: |
||||||||||||||||||||
| United States | $ | 19,217,696 | 84% | $ | 17,946,738 | 85% | $ | 31,808,886 | 83% | $ | 29,827,778 | 84% | ||||||||
| Europe | 2,330,890 | 10% | 1,789,766 | 8% | 4,317,214 | 11% | 3,482,903 | 10% | ||||||||||||
| Other | 1,349,446 | 6% | 1,530,652 | 7% | 2,286,614 | 6% | 2,307,880 | 6% | ||||||||||||
| Total Revenue | $ | 22,898,032 | 100% | $ | 21,267,156 | 100% | $ | 38,412,714 | 100% | $ | 35,618,561 | 100% | ||||||||
