Second quarter 2017 GAAP revenue increased 24%
over same period last year
AMAG Pharmaceuticals, Inc. (NASDAQ:AMAG) today reported unaudited
consolidated financial results for the quarter ended June 30,
2017. Total GAAP revenue for the second quarter of 2017 increased
to a record $158.4 million, 24% higher than the same period last
year (and 14% higher than the first quarter of 2017). This increase
was driven by sales growth across the product portfolio,
particularly Makena® (hydroxyprogesterone caproate injection),
which grew 31%. The company reported operating income of $3.6
million in the second quarter of 2017, compared with $18.1 million
in the same period last year. Non-GAAP adjusted EBITDA totaled
$50.1 million in the second quarter of 2017, compared with $64.6
million in the second quarter of 2016.1
"AMAG delivered another quarter of record revenues and strong
growth across our portfolio of products. That same commercial
excellence is now being applied to the launch of Intrarosa,
announced just last week," said William Heiden, president and chief
executive officer. "We have already realized a number of
significant milestones in 2017, and look forward to reaching many
others in the second half of the year. The achievement of these
goals is an important step on the path to building an even stronger
company that develops and markets novel therapeutics to address
significant unmet medical needs."
Second Quarter 2017 and Recent Business
Highlights:
- Hired and trained a new women's health commercial team of
approximately 150 people;
- Launched Intrarosa, the first and only FDA-approved local
non-estrogen product for the treatment of moderate-to-severe
dyspareunia (pain during intercourse), a symptom of vulvar and
vaginal atrophy (VVA), due to menopause;
- Advanced bremelanotide development and regulatory activities to
support the planned new drug application (NDA) submission in early
2018;
- Received FDA acceptance for review of Makena subcutaneous
auto-injector supplemental NDA (sNDA) and a PDUFA date of February
14, 2018;
- Drove record quarterly sales of Makena to over $102
million;
- Realized highest number of new family enrollments at Cord Blood
Registry® (CBR) since the fourth quarter of 2015;
- Partner, Velo Bio, enrolled first patient in Phase 2b/3a study
for the treatment of severe preeclampsia;
- Achieved record quarterly sales of Feraheme and completed
submission to FDA to broaden Feraheme's label; and
- Strengthened the balance sheet and ended the quarter with
$399.2 million of cash and investments.
Second Quarter Ended June 30, 2017
(unaudited)
Financial Results (GAAP Basis)Total revenues for the second
quarter of 2017 were $158.4 million, compared with $127.4 million
in the second quarter of 2016. Net product sales of Makena were
$102.7 million in the second quarter of 2017, compared with $78.4
million in the same period last year. Sales of Feraheme and MuGard®
totaled $27.7 million in the second quarter of 2017, compared with
$24.6 million in the second quarter of 2016. Service revenue from
CBR totaled $28.0 million in the second quarter of 2017, compared
with $24.4 million in the same period last year.
Costs and expenses, including costs of product sales and
services, totaled $154.8 million in the second quarter of 2017,
compared with $109.3 million for the same period in 2016. This
increase was primarily due to (i) higher selling, general and
administrative expenses of $29.1 million primarily related to
commercial activities to support the launch of Intrarosa, including
the addition of a new women's health sales force, (ii) higher
research and development expenses of $16.0 million, primarily due
to development work performed by Palatin to support the NDA for
bremelanotide, and (iii) higher cost of products sold of $10.2
million, of which $8.9 million was due to amortization expense
related to the Makena intangible asset. Also recorded in the second
quarter of 2017 was a charge of $5.8 million to acquired in-process
research and development expense in connection with the closing of
the company's agreement with Endoceutics for the rights to
Intrarosa.
The higher expenses in the second quarter of 2017 resulted in
$3.6 million in operating income in the second quarter of 2017, a
decrease of $14.4 million, as compared to $18.1 million in
operating income for the same period last year. The company
reported a net loss of $14.1 million, or $(0.40) per basic and
diluted share, for the second quarter of 2017, compared with a net
loss of $0.6 million, or $(0.02) per basic share and diluted share,
for the same period in 2016. The increased net loss in the second
quarter of 2017 includes a $9.5 million loss on the extinguishment
of debt in connection with the early retirement of the company's
term loan and a portion of the convertible notes due in 2019.
Financial Results (Non-GAAP Basis)1Non-GAAP revenue totaled
$159.8 million in the second quarter of 2017, up from $132.5
million in the second quarter of 2016. Non-GAAP CBR service revenue
totaled $29.4 million in each of the second quarters of 2017 and
2016. The difference between GAAP and non-GAAP revenue represents
CBR purchase accounting adjustments related to deferred
revenue.
Total costs and expenses on a non-GAAP basis totaled $109.7
million in the second quarter of 2017, compared with $67.8 million
in the second quarter of 2016.
Non-GAAP adjusted EBITDA for the second quarter of 2017 was
$50.1 million, resulting in an adjusted EBITDA margin of 31%. This
compares to non-GAAP adjusted EBITDA of $64.6 million in the second
quarter of 2016, with an adjusted EBITDA margin of 49%. The decline
in adjusted EBITDA for the second quarter of 2017 is in line with
the company's expectations and stated plans to invest in the
continued development of its current and future products in order
to create long-term value.
Balance Sheet HighlightsAs of June 30, 2017, the company’s
cash and investments totaled $399.2 million and total debt
(principal amount outstanding) was $861.1 million.
During the second quarter of 2017, the company issued $320
million of convertible senior notes due in 2022. The company also
repurchased $158.9 million of its existing convertible senior notes
due in 2019 for an aggregate purchase price of $171.3 million,
including accrued interest. The company used proceeds from the
convertible transactions, along with balance sheet cash, to repay
the remaining balance of $321.8 million of its term loan, which was
due in 2021.
"By extending our maturities and reducing our total debt by
approximately $170 million, we have more financial flexibility to
invest in our newest products -- Intrarosa and bremelanotide, as
well as continue to expand our product portfolio through potential
acquisitions and licensing transactions," stated Ted Myles, chief
financial officer. "We are pleased with the strong second quarter
and year-to-date 2017 financial performance reported today, and we
are reaffirming our full year guidance."
Reaffirming 2017 Financial Guidance
|
|
2017 GAAP Guidance |
|
2017 Non-GAAP Guidance |
$ in millions |
|
|
|
|
Makena
sales |
|
$410 -
$440 |
|
$410 -
$440 |
Feraheme
and MuGard sales |
|
$100 -
$110 |
|
$100 -
$110 |
CBR
revenue |
|
$110 -
$120 |
|
$115 -
$1253 |
Intrarosa |
|
$5 -
$15 |
|
$5 -
$15 |
Total
revenue |
|
$625 - $685 |
|
$630 - $690 |
|
|
|
|
|
Net loss |
|
($62)
- ($31)2 |
|
N/A |
Operating income
(loss) |
|
($23)
- $272 |
|
N/A |
Adjusted EBITDA |
|
N/A |
|
$210 -
$260 |
Conference Call and Webcast AccessAMAG
Pharmaceuticals, Inc. will host a conference call and webcast today
at 8:00 a.m. ET to discuss the company's second quarter 2017
financial results and recent business highlights.
Dial-in NumberU.S./Canada dial-in number: (877)
412-6083International dial-in number: (702) 495-1202Conference ID:
36834416
Replay dial-in number: (855) 859-2056Replay International
dial-in number: (404) 537-3406Conference ID: 36834416
A telephone replay will be available from approximately 11:00
a.m. ET on August 3, 2017 through midnight on August 9, 2017.
The webcast with slides will be accessible through the Investors
section of AMAG’s website at www.amagpharma.com. A replay of the
webcast will be archived on the website for 30 days.
Use of Non-GAAP Financial MeasuresAMAG has
presented certain non-GAAP financial measures, including non-GAAP
revenue, non-GAAP costs and expenses, non-GAAP adjusted EBITDA
(earnings before income taxes, depreciation and amortization), and
non-GAAP adjusted EBITDA margin. These non-GAAP financial measures
exclude certain amounts, revenue, expenses or income, from the
corresponding financial measures determined in accordance with
accounting principles generally accepted in the U.S. (GAAP).
Management believes this non-GAAP information is useful for
investors, taken in conjunction with AMAG’s GAAP financial
statements, because it provides greater transparency regarding
AMAG’s operating performance. Management uses these measures, among
other factors, to assess and analyze operational results and trends
and to make financial and operational decisions. Non-GAAP
information is not prepared under a comprehensive set of accounting
rules and should only be used to supplement an understanding of
AMAG’s operating results as reported under GAAP, not as a
substitute for GAAP. In addition, these non-GAAP financial measures
are unlikely to be comparable with non-GAAP information provided by
other companies. The determination of the amounts that are excluded
from non-GAAP financial measures is a matter of management judgment
and depends upon, among other factors, the nature of the underlying
expense or income amounts. Reconciliations between these non-GAAP
financial measures and the most comparable GAAP financial measures
are included in the tables accompanying this press release after
the unaudited condensed consolidated financial statements.
1 See summaries of GAAP to non-GAAP adjustments at the
conclusion of this press release.2 See reconciliation of 2017
financial guidance at the conclusion of this press release.3
Revenue includes purchase accounting adjustments related to CBR
deferred revenue.
About AMAGAMAG is a biopharmaceutical company
focused on developing and delivering important therapeutics,
conducting clinical research in areas of unmet need and creating
education and support programs for the patients and families we
serve. Our currently marketed products support the health of
patients in the areas of maternal and women's health, anemia
management and cancer supportive care. Through CBR®, we also help
families to preserve newborn stem cells, which are used today in
transplant medicine for certain cancers and blood, immune and
metabolic disorders, and have the potential to play a valuable role
in the ongoing development of regenerative medicine. For additional
company information, please visit www.amagpharma.com.
About IntrarosaTM (prasterone)Intrarosa is
a steroid indicated for the treatment of moderate to severe
dyspareunia, a symptom of vulvar and vaginal atrophy, due to
menopause. Intrarosa contains prasterone, also known as
dehydroepiandrosterone (DHEA). Prasterone is an inactive endogenous
steroid, which is converted locally in the vagina into androgens
and estrogens to help restore the vaginal tissue as indicated by
improvements in the percentage of superficial cells, parabasal
cells, pH and pain with intercourse. The mechanism of action is not
fully established.
Intrarosa is contraindicated in women with undiagnosed abnormal
genital bleeding. Estrogen is a metabolite of prasterone. Use of
exogenous estrogen is contraindicated in women with a known or
suspected history of breast cancer. Intrarosa has not been studied
in women with a history of breast cancer.
In four 12-week randomized, placebo-controlled clinical trials,
the most common adverse reaction with an incidence ≥2 percent was
vaginal discharge. In one 52-week open-label clinical trial, the
most common adverse reactions with an incidence ≥2 percent were
vaginal discharge and abnormal pap smear.
Please see full Prescribing Information available at
www.Intrarosa.com.
About Makena® (hydroxyprogesterone caproate
injection)Makena® is a progestin indicated to reduce the
risk of preterm birth in women pregnant with a single baby who have
a history of singleton spontaneous preterm
birth.
The effectiveness of Makena is based on improvement in the
proportion of women who delivered <37 weeks of gestation. There
are no controlled trials demonstrating a direct clinical benefit,
such as improvement in neonatal mortality and morbidity.
Limitation of use: While there are many risk factors for preterm
birth, safety and efficacy of Makena has been demonstrated only in
women with a prior spontaneous singleton preterm birth. It is not
intended for use in women with multiple gestations or other risk
factors for preterm birth.
Makena should not be used in women with any of the following
conditions: blood clots or other blood clotting problems, breast
cancer or other hormone-sensitive cancers, or history of these
conditions; unusual vaginal bleeding not related to the current
pregnancy, yellowing of the skin due to liver problems during
pregnancy, liver problems, including liver tumors, or uncontrolled
high blood pressure. Before patients receive Makena, they should
tell their healthcare provider if they have an allergy to
hydroxyprogesterone caproate, castor oil, or any of the other
ingredients in Makena; diabetes or prediabetes, epilepsy, migraine
headaches, asthma, heart problems, kidney problems, depression, or
high blood pressure.
In one clinical study, certain complications or events
associated with pregnancy occurred more often in women who received
Makena. These included miscarriage (pregnancy loss before 20 weeks
of pregnancy), stillbirth (fetal death occurring during or after
the 20th week of pregnancy), hospital admission for preterm labor,
preeclampsia (high blood pressure and too much protein in the
urine), gestational hypertension (high blood pressure caused by
pregnancy), gestational diabetes, and oligohydramnios (low amniotic
fluid levels).
Makena may cause serious side effects including blood clots,
allergic reactions, depression, and yellowing of the skin and the
whites of the eyes. The most common side effects of Makena include
injection site reactions (pain, swelling, itching, bruising, or a
hard bump), hives, itching, nausea, and diarrhea.
For additional product information, including full prescribing
information, please visit www.makena.com.
About Feraheme® (ferumoxytol)Feraheme received
marketing approval from the FDA on June 30, 2009 for the treatment
of IDA in adult CKD patients and was commercially launched by AMAG
in the U.S. shortly thereafter. Ferumoxytol is protected in the
U.S. by seven issued patents covering the composition and dosage
form of the product. Six of the issued patents are listed in the
FDA’s Orange Book, the last of which expires in June 2023.
Fatal and serious hypersensitivity reactions including
anaphylaxis have occurred in patients receiving Feraheme. Initial
symptoms may include hypotension, syncope, unresponsiveness,
cardiac/cardiorespiratory arrest. Feraheme is contraindicated in
patients with a known hypersensitivity to Feraheme or any of its
components, or a history of allergic reaction to any intravenous
iron product.
For additional product information, please see full Prescribing
Information, including Boxed Warning, available at
www.feraheme.com.
About Cord Blood Registry® (CBR)CBR is the
world’s largest private newborn stem cell company. Founded in 1992,
CBR is entrusted by parents with storing more than 650,000
umbilical cord blood and cord tissue units. CBR is dedicated to
advancing the clinical application of newborn stem cells by
partnering with reputable research institutions on FDA-regulated
clinical trials for conditions that have no cure today. For more
information, visit www.cordblood.com.
About BremelanotideBremelanotide, an
investigational product, is thought to possess a novel mechanism of
action, activating endogenous melanocortin pathways involved in
sexual desire and response.
The two Phase 3 studies for hypoactive sexual desire disorder
(HSDD) in pre-menopausal women consisted of double-blind
placebo-controlled, randomized parallel group studies comparing a
subcutaneous dose of 1.75 mg of bremelanotide delivered via an
auto-injector pen to placebo. Each trial consisted of more than 600
patients randomized in a 1:1 ratio to either the treatment arm or
placebo with a 24 week evaluation period. In both clinical trials,
bremelanotide met the pre-specified co-primary efficacy endpoints
of improvement in desire and decrease in distress associated with
low sexual desire as measured using validated patient-reported
outcome instruments.
Women in the trials had the option, after completion of the
trial, to continue in an open-label safety extension study for an
additional 12 months. Nearly 80% of patients elected to remain in
the open-label portion of the study, and all of these patients
received bremelanotide.
In both Phase 2 and Phase 3 clinical trials, the most frequent
adverse events were nausea, flushing, and headache, which were
generally mild-to-moderate in severity.
Bremelanotide has no known alcohol interactions.
Forward-Looking StatementsThis press release
contains forward-looking information about AMAG Pharmaceuticals,
Inc. within the meaning of the Private Securities Litigation Reform
Act of 1995 and other federal securities laws. Any statements
contained herein which do not describe historical facts, including,
among others, beliefs that AMAG will reach many significant
milestones in the second half of 2017 that will enable it to build
a stronger company; beliefs that its financial flexibility will
allow it to invest in current products and expand its portfolio;
expected 2017 second quarter financial results, including revenues
and year end cash, cash equivalents and investments balances and
total debt; AMAG’s 2017 financial outlook, including revenue,
adjusted EBITDA and net income; and beliefs that newborn stem cells
have the potential to play a valuable role in the development of
regenerative medicine are forward-looking statements which involve
risks and uncertainties that could cause actual results to differ
materially from those discussed in such forward-looking
statements.
Such risks and uncertainties include, among others, those risks
identified in AMAG’s filings with the U.S. Securities and Exchange
Commission (SEC), including its Annual Report on Form 10-K for the
year ended December 31, 2016 and subsequent filings with the SEC.
Any such risks and uncertainties could materially and adversely
affect AMAG’s results of operations, its profitability and its cash
flows, which would, in turn, have a significant and adverse impact
on AMAG’s stock price. AMAG cautions you not to place undue
reliance on any forward-looking statements, which speak only as of
the date they are made.
AMAG disclaims any obligation to publicly update or revise any
such statements to reflect any change in expectations or in events,
conditions or circumstances on which any such statements may be
based, or that may affect the likelihood that actual results will
differ from those set forth in the forward-looking statements.
AMAG Pharmaceuticals® and Feraheme® are registered trademark of
AMAG Pharmaceuticals, Inc. MuGard® is a registered trademark of
Abeona Therapeutics, Inc. Makena® is a registered trademark of AMAG
Pharmaceuticals IP, Ltd. Cord Blood Registry® and CBR® are
registered trademarks of Cbr Systems, Inc. IntrarosaTM is a
trademark of Endoceutics, Inc.
– Tables Follow –
AMAG Pharmaceuticals,
Inc.Condensed Consolidated Statements of
Operations(Unaudited, amounts in thousands, except
for per share data) |
|
|
|
|
|
Three Months Ended June
30, |
|
Six Months Ended June
30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues: |
|
|
|
|
|
|
|
Makena |
$ |
102,681 |
|
|
$ |
78,406 |
|
|
$ |
189,136 |
|
|
$ |
143,438 |
|
Feraheme/MuGard |
27,661 |
|
|
24,577 |
|
|
53,723 |
|
|
49,109 |
|
Cord
Blood Registry |
28,023 |
|
|
24,379 |
|
|
54,955 |
|
|
43,898 |
|
License
fee, collaboration and other revenues |
29 |
|
|
57 |
|
|
53 |
|
|
273 |
|
Total
revenues |
158,394 |
|
|
127,419 |
|
|
297,867 |
|
|
236,718 |
|
Operating costs and
expenses: |
|
|
|
|
|
|
|
Cost of
product sales |
32,101 |
|
|
21,937 |
|
|
59,675 |
|
|
40,236 |
|
Cost of
services |
5,562 |
|
|
5,195 |
|
|
10,572 |
|
|
10,721 |
|
Research
and development expenses |
30,258 |
|
|
14,234 |
|
|
46,747 |
|
|
28,463 |
|
Acquired
in-process research and development |
5,845 |
|
|
— |
|
|
65,845 |
|
|
— |
|
Selling,
general and administrative expenses |
80,988 |
|
|
51,924 |
|
|
151,412 |
|
|
115,098 |
|
Impairment charges of intangible assets |
— |
|
|
15,963 |
|
|
— |
|
|
15,963 |
|
Restructuring expenses |
— |
|
|
89 |
|
|
— |
|
|
712 |
|
Total
costs and expenses |
154,754 |
|
|
109,342 |
|
|
334,251 |
|
|
211,193 |
|
Operating income
(loss) |
3,640 |
|
|
18,077 |
|
|
(36,384 |
) |
|
25,525 |
|
|
|
|
|
|
|
|
|
Other (expense)
income: |
|
|
|
|
|
|
|
Interest
expense |
(17,256 |
) |
|
(18,250 |
) |
|
(35,556 |
) |
|
(36,693 |
) |
Loss on
debt extinguishment |
(9,516 |
) |
|
— |
|
|
(9,516 |
) |
|
— |
|
Interest
and dividend income |
663 |
|
|
773 |
|
|
1,695 |
|
|
1,481 |
|
Other
(expense) income |
(69 |
) |
|
— |
|
|
(43 |
) |
|
220 |
|
Total
other (expense) income |
(26,178 |
) |
|
(17,477 |
) |
|
(43,420 |
) |
|
(34,992 |
) |
(Loss) income before
income taxes |
(22,538 |
) |
|
600 |
|
|
(79,804 |
) |
|
(9,467 |
) |
Income tax (benefit)
expense |
(8,472 |
) |
|
1,196 |
|
|
(29,178 |
) |
|
(1,344 |
) |
Net loss |
$ |
(14,066 |
) |
|
$ |
(596 |
) |
|
$ |
(50,626 |
) |
|
$ |
(8,123 |
) |
|
|
|
|
|
|
|
|
Net loss per share |
|
|
|
|
|
|
|
Basic |
$ |
(0.40 |
) |
|
$ |
(0.02 |
) |
|
$ |
(1.46 |
) |
|
$ |
(0.24 |
) |
Diluted |
$ |
(0.40 |
) |
|
$ |
(0.02 |
) |
|
$ |
(1.46 |
) |
|
$ |
(0.24 |
) |
|
|
|
|
|
|
|
|
Weighted average shares
outstanding used to compute net loss per share:
|
|
|
|
|
|
|
|
Basic |
35,145 |
|
|
34,223 |
|
|
34,764 |
|
|
34,481 |
|
Diluted |
35,145 |
|
|
34,223 |
|
|
34,764 |
|
|
34,481 |
|
AMAG
Pharmaceuticals, Inc.Condensed Consolidated
Balance Sheets(Unaudited, amounts in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2017 |
|
December 31, 2016 |
ASSETS |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
|
|
|
$ |
260,119 |
|
|
$ |
274,305 |
|
Investments |
|
|
|
|
139,095 |
|
|
304,781 |
|
Accounts
receivable, net |
|
|
|
|
89,462 |
|
|
92,375 |
|
Inventories |
|
|
|
|
37,476 |
|
|
37,258 |
|
Prepaid
and other current assets |
|
|
|
|
11,138 |
|
|
9,839 |
|
Total
current assets |
|
|
|
|
537,290 |
|
|
718,558 |
|
Property, plant and
equipment, net |
|
|
|
|
22,283 |
|
|
24,460 |
|
Goodwill |
|
|
|
|
639,484 |
|
|
639,484 |
|
Intangible assets,
net |
|
|
|
|
1,116,047 |
|
|
1,092,178 |
|
Restricted cash |
|
|
|
|
2,653 |
|
|
2,593 |
|
Other long-term
assets |
|
|
|
|
897 |
|
|
1,153 |
|
Total
assets |
|
|
|
|
$ |
2,318,654 |
|
|
$ |
2,478,426 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
Accounts
payable |
|
|
|
|
$ |
8,154 |
|
|
$ |
3,684 |
|
Accrued
expenses |
|
|
|
|
210,853 |
|
|
156,008 |
|
Current
portion of long-term debt |
|
|
|
|
— |
|
|
21,166 |
|
Current
portion of acquisition-related contingent consideration
|
|
|
|
|
98,646 |
|
|
97,068 |
|
Deferred
revenues |
|
|
|
|
37,489 |
|
|
34,951 |
|
Total
current liabilities |
|
|
|
|
355,142 |
|
|
312,877 |
|
Long-term
liabilities: |
|
|
|
|
|
|
|
Long-term
debt, net |
|
|
|
|
490,210 |
|
|
785,992 |
|
Convertible notes, net |
|
|
|
|
279,546 |
|
|
179,363 |
|
Acquisition-related contingent consideration |
|
|
|
|
52,017 |
|
|
50,927 |
|
Deferred
tax liabilities |
|
|
|
|
172,800 |
|
|
197,066 |
|
Deferred
revenues |
|
|
|
|
19,692 |
|
|
14,850 |
|
Other
long-term liabilities |
|
|
|
|
1,799 |
|
|
2,962 |
|
Total
liabilities |
|
|
|
|
1,371,206 |
|
|
1,544,037 |
|
Total
stockholders’ equity |
|
|
|
|
947,448 |
|
|
934,389 |
|
Total
liabilities and stockholders’ equity |
|
|
|
|
$ |
2,318,654 |
|
|
$ |
2,478,426 |
|
AMAG
Pharmaceuticals, Inc.Condensed Consolidated
Statements of Cash Flows(Unaudited, amounts in
thousands) |
|
|
|
|
|
Six Months Ended June 30,
|
|
|
2017 |
|
2016 |
Cash flows from
operating activities: |
|
|
|
|
Net loss |
|
$ |
(50,626 |
) |
|
$ |
(8,123 |
) |
Adjustments to
reconcile net loss to net cash provided by operating
activities: |
|
|
|
|
Depreciation and amortization |
|
59,563 |
|
|
41,231 |
|
Impairment of intangible assets |
|
— |
|
|
15,963 |
|
Provision
for bad debt expense |
|
2,681 |
|
|
— |
|
Amortization of premium/discount on purchased securities |
|
168 |
|
|
351 |
|
Non-cash
equity-based compensation expense |
|
11,669 |
|
|
11,342 |
|
Non-cash
IPR&D expense |
|
945 |
|
|
— |
|
Loss on
debt extinguishment |
|
9,516 |
|
|
— |
|
Amortization of debt discount and debt issuance costs |
|
6,679 |
|
|
5,940 |
|
Gains on
investments, net |
|
(249 |
) |
|
— |
|
Change in
fair value of contingent consideration |
|
2,786 |
|
|
1,399 |
|
Deferred
income taxes |
|
(29,677 |
) |
|
(1,371 |
) |
Changes in operating
assets and liabilities: |
|
|
|
|
Accounts
receivable, net |
|
233 |
|
|
19,592 |
|
Inventories |
|
(1,145 |
) |
|
281 |
|
Receivable from collaboration |
|
— |
|
|
428 |
|
Prepaid
and other current assets |
|
(1,178 |
) |
|
(273 |
) |
Accounts
payable and accrued expenses |
|
40,716 |
|
|
4,700 |
|
Deferred
revenues |
|
7,380 |
|
|
17,204 |
|
Other
assets and liabilities |
|
(1,029 |
) |
|
1,970 |
|
Net cash
provided by operating activities |
|
58,432 |
|
|
110,634 |
|
Cash flows from
investing activities: |
|
|
|
|
Proceeds
from sales or maturities of investments |
|
251,017 |
|
|
42,500 |
|
Purchase
of investments |
|
(85,249 |
) |
|
(98,795 |
) |
Acquisition of Intrarosa intangible asset |
|
(46,500 |
) |
|
— |
|
Change in
restricted cash |
|
(60 |
) |
|
— |
|
Capital
expenditures |
|
(2,672 |
) |
|
(2,587 |
) |
Net cash
provided by (used in) investing activities |
|
116,536 |
|
|
(58,882 |
) |
Cash flows from
financing activities: |
|
|
|
|
Long-term
debt principal payments |
|
(328,125 |
) |
|
(8,752 |
) |
Proceeds
from 2022 Convertible Notes |
|
320,000 |
|
|
— |
|
Payment
to extinguish 2019 Convertible Notes |
|
(170,371 |
) |
|
— |
|
Proceeds
to settle warrants |
|
323 |
|
|
— |
|
Payment
of convertible debt issuance costs |
|
(9,553 |
) |
|
— |
|
Payments
of contingent consideration |
|
(119 |
) |
|
(149 |
) |
Payments
for repurchases of common stock |
|
— |
|
|
(20,000 |
) |
Proceeds
from the issuance and exercise of common stock options |
|
1,130 |
|
|
1,569 |
|
Payments
of employee tax withholding related to equity-based
compensation |
|
(2,439 |
) |
|
(2,015 |
) |
Net cash
used in financing activities |
|
(189,154 |
) |
|
(29,347 |
) |
Net (decrease) increase
in cash and cash equivalents |
|
(14,186 |
) |
|
22,405 |
|
Cash and cash
equivalents at beginning of the period |
|
274,305 |
|
|
228,705 |
|
Cash and cash
equivalents at end of the period |
|
$ |
260,119 |
|
|
$ |
251,110 |
|
Supplemental data for
cash flow information: |
|
|
|
|
Cash paid
for taxes |
|
$ |
3,191 |
|
|
$ |
3,903 |
|
Cash paid
for interest |
|
$ |
29,173 |
|
|
$ |
32,017 |
|
Non-cash investing
activities: |
|
|
|
|
Fair
value of common stock issued in connection with the acquisition of
the Intrarosa intangible asset |
|
$ |
12,555 |
|
|
$ |
— |
|
Contingent consideration accrued for the acquisition of the
Intrarosa intangible asset |
|
$ |
18,600 |
|
|
$ |
— |
|
AMAG
Pharmaceuticals, Inc.Reconciliation of
Condensed Consolidated Statements of Operations to Non-GAAP
Statements of OperationsThree months ended June
30, 2017 (Unaudited, amounts in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
Cost of product sales |
|
Cost of services |
|
Research & development |
|
Acquired in-processresearch
anddevelopment |
|
Selling,general
&administrative |
|
Restructuring |
|
OperatingIncome / AdjustedEBITDA |
GAAP |
$ |
158,394 |
|
|
$ |
32,101 |
|
|
$ |
5,562 |
|
|
$ |
30,258 |
|
|
$ |
5,845 |
|
|
$ |
80,988 |
|
|
$ |
— |
|
|
$ |
3,640 |
|
Purchase accounting
adjustments related to CBR deferred revenue |
1,364 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Depreciation and
intangible asset amortization |
— |
|
|
(25,042 |
) |
|
(393 |
) |
|
(45 |
) |
|
— |
|
|
(5,896 |
) |
|
— |
|
|
|
Non-cash inventory
step-up adjustments |
— |
|
|
(194 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Stock-based
compensation |
— |
|
|
(129 |
) |
|
— |
|
|
(1,095 |
) |
|
— |
|
|
(4,667 |
) |
|
— |
|
|
|
Adjustments to
contingent consideration |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,743 |
) |
|
— |
|
|
|
Acquired IPR&D |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(5,845 |
) |
|
— |
|
|
— |
|
|
|
Non-GAAP
Adjusted |
$ |
159,758 |
|
|
$ |
6,736 |
|
|
$ |
5,169 |
|
|
$ |
29,118 |
|
|
$ |
— |
|
|
$ |
68,682 |
|
|
$ |
— |
|
|
$ |
50,053 |
|
AMAG
Pharmaceuticals, Inc.Reconciliation of
Condensed Consolidated Statements of Operations to Non-GAAP
Statements of OperationsThree months ended June
30, 2016 (Unaudited, amounts in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
Cost of product sales |
|
Cost of services |
|
Research & development |
|
Acquired in-processresearch
anddevelopment |
|
Selling,general &
administrative |
|
Restructuring |
|
OperatingIncome / AdjustedEBITDA |
GAAP |
$ |
127,419 |
|
|
$ |
21,937 |
|
|
$ |
5,195 |
|
|
$ |
14,234 |
|
|
$ |
— |
|
|
$ |
67,887 |
|
|
$ |
89 |
|
|
$ |
18,077 |
|
Purchase accounting
adjustments related to CBR deferred revenue |
5,053 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Depreciation and
intangible asset amortization |
— |
|
|
(16,188 |
) |
|
(353 |
) |
|
(33 |
) |
|
— |
|
|
(5,013 |
) |
|
— |
|
|
|
Non-cash inventory
step-up adjustments |
— |
|
|
(1,483 |
) |
|
— |
|
|
(861 |
) |
|
— |
|
|
— |
|
|
— |
|
|
|
Stock-based
compensation |
— |
|
|
44 |
|
|
— |
|
|
(973 |
) |
|
— |
|
|
(4,249 |
) |
|
— |
|
|
|
Adjustments to
contingent consideration |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
3,657 |
|
|
— |
|
|
|
Impairment charges of
intangible assets |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(15,963 |
) |
|
— |
|
|
|
Restructuring
costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(89 |
) |
|
|
Non-GAAP
Adjusted |
$ |
132,472 |
|
|
$ |
4,310 |
|
|
$ |
4,842 |
|
|
$ |
12,367 |
|
|
$ |
— |
|
|
$ |
46,319 |
|
|
$ |
— |
|
|
$ |
64,634 |
|
AMAG
Pharmaceuticals, Inc.Reconciliation of
Condensed Consolidated Statements of Operations to Non-GAAP
Statements of OperationsSix months ended June 30,
2017 (Unaudited, amounts in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
Cost of product sales |
|
Cost of services |
|
Research & development |
|
Acquired in-processresearch
anddevelopment |
|
Selling,general &
administrative |
|
Restructuring |
|
OperatingIncome / AdjustedEBITDA |
GAAP |
$ |
297,867 |
|
|
$ |
59,675 |
|
|
$ |
10,572 |
|
|
$ |
46,747 |
|
|
$ |
65,845 |
|
|
$ |
151,412 |
|
|
$ |
— |
|
|
$ |
(36,384 |
) |
Purchase accounting
adjustments related to CBR deferred revenue |
2,730 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Depreciation and
intangible asset amortization |
— |
|
|
(45,994 |
) |
|
(784 |
) |
|
(89 |
) |
|
— |
|
|
(11,769 |
) |
|
— |
|
|
|
Non-cash inventory
step-up adjustments |
— |
|
|
(927 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Stock-based
compensation |
— |
|
|
(258 |
) |
|
— |
|
|
(1,851 |
) |
|
— |
|
|
(9,559 |
) |
|
— |
|
|
|
Adjustments to
contingent consideration |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(2,786 |
) |
|
— |
|
|
|
Transaction/Acquisition-related costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,462 |
) |
|
— |
|
|
|
Acquired IPR&D |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(65,845 |
) |
|
— |
|
|
— |
|
|
|
Non-GAAP
Adjusted |
$ |
300,597 |
|
|
$ |
12,496 |
|
|
$ |
9,788 |
|
|
$ |
44,807 |
|
|
$ |
— |
|
|
$ |
125,836 |
|
|
$ |
— |
|
|
$ |
107,670 |
|
AMAG
Pharmaceuticals, Inc.Reconciliation of
Condensed Consolidated Statements of Operations to Non-GAAP
Statements of OperationsSix months ended June 30,
2016 (Unaudited, amounts in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
Cost of product sales |
|
Cost of services |
|
Research & development |
|
Acquired in-processresearch
anddevelopment |
|
Selling,general &
administrative |
|
Restructuring |
|
OperatingIncome / AdjustedEBITDA |
GAAP |
$ |
236,718 |
|
|
$ |
40,236 |
|
|
$ |
10,721 |
|
|
$ |
28,463 |
|
|
$ |
— |
|
|
$ |
131,061 |
|
|
$ |
712 |
|
|
$ |
25,525 |
|
Purchase accounting
adjustments related to CBR deferred revenue |
13,614 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Depreciation and
intangible asset amortization |
— |
|
|
(29,686 |
) |
|
(704 |
) |
|
(55 |
) |
|
— |
|
|
(9,987 |
) |
|
— |
|
|
|
Non-cash inventory
step-up adjustments |
— |
|
|
(2,283 |
) |
|
— |
|
|
(861 |
) |
|
— |
|
|
— |
|
|
— |
|
|
|
Stock-based
compensation |
— |
|
|
(267 |
) |
|
(9 |
) |
|
(1,725 |
) |
|
— |
|
|
(9,340 |
) |
|
— |
|
|
|
Adjustments to
contingent consideration |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,399 |
) |
|
— |
|
|
|
Option rights to
license orphan drug |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
Impairment charges of
intangible assets |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(15,963 |
) |
|
— |
|
|
|
Restructuring
costs |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(712 |
) |
|
|
Non-GAAP
Adjusted |
$ |
250,332 |
|
|
$ |
8,000 |
|
|
$ |
10,008 |
|
|
$ |
25,822 |
|
|
$ |
— |
|
|
$ |
94,372 |
|
|
$ |
— |
|
|
$ |
112,130 |
|
AMAG
Pharmaceuticals, Inc.Reconciliation of 2017
Financial Guidance of Non-GAAP Adjusted
EBITDA(Unaudited, amounts in
millions) |
|
|
|
|
|
|
|
|
|
2017 |
|
|
|
|
Financial |
|
|
|
|
Guidance
|
GAAP Net
Loss |
|
|
|
($62) - ($31) |
Adjustments: |
|
|
|
|
Interest
expense, net |
|
|
|
66 |
Loss on
debt extinguishment |
|
|
|
10 |
Provision
for income tax benefit |
|
|
|
(37) - (18) |
Operating income (loss) |
|
|
|
($23) - $27 |
Purchase
accounting adjustments related to CBR deferred revenue
|
|
|
|
6 |
Depreciation and intangible asset amortization |
|
|
|
127 |
Non-cash
inventory step-up adjustments |
|
|
|
2 |
Stock-based compensation |
|
|
|
27 |
Adjustments to contingent consideration |
|
|
|
5 |
Acquired
IPR&D4 |
|
|
|
66 |
Non-GAAP
adjusted EBITDA |
|
|
|
$210 - $260 |
AMAG
Pharmaceuticals, Inc.Share Count
Reconciliation(Unaudited, amounts in
millions) |
|
|
|
|
|
|
|
|
Three Months Ended June
30, |
|
Six Months Ended June 30,
|
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
|
Weighted
average basic shares outstanding |
|
35.1 |
|
|
34.2 |
|
|
34.8 |
|
|
34.5 |
|
|
Employee
equity incentive awards |
|
— |
|
5 |
— |
|
5 |
— |
|
5 |
— |
|
5 |
Convertible notes |
|
— |
|
5 |
— |
|
5 |
— |
|
5 |
— |
|
5 |
Warrants |
|
— |
|
5 |
— |
|
5 |
— |
|
5 |
— |
|
5 |
GAAP diluted
shares outstanding |
|
35.1 |
|
|
34.2 |
|
|
34.8 |
|
|
34.5 |
|
|
Employee
equity incentive awards |
|
0.4 |
|
6 |
0.4 |
|
6 |
0.5 |
|
6 |
0.3 |
|
6 |
Non-GAAP
diluted shares outstanding |
|
35.5 |
|
|
34.6 |
|
|
35.3 |
|
|
34.8 |
|
|
4 Reflects accounting charges associated with one-time upfront
payments to Palatin and Endoceutics as required under the terms of
the licensing agreements.5 Employee equity incentive awards,
convertible notes and warrants would be anti-dilutive in this
period.6 Reflects the Non-GAAP dilutive impact of employee equity
incentive awards.
CONTACT:
AMAG Pharmaceuticals, Inc.
Linda Lennox
Vice President, Investor Relations
O: 617-498-2846
M: 908-627-3424
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