Assertio Holdings, Inc. (“Assertio” or the “Company”) (Nasdaq:
ASRT), a pharmaceutical company with comprehensive commercial
capabilities offering differentiated products to patients, today
reported financial results for the first quarter ended
March 31, 2024.
“We are pleased to report a strong first quarter
as our team continues to diligently execute our business plan and
seeks to grow Assertio for the benefit of our stockholders,” said
Heather Mason, interim Chief Executive Officer. “Rolvedon generated
its fifth consecutive quarter of demand growth since launch, driven
by continued market penetration in the clinic setting.
Additionally, we completed enrollment of Rolvedon’s same-day dosing
trial, and expect the data readout by year-end, providing a
potential opportunity for differentiation through medical society
guidelines. We remain committed to our lean promotion platform and
steadfast in our business development efforts as we work to secure
additional new assets to fuel both sales growth and incremental
cash flow generation.”
“We are reiterating our guidance for 2024,
calling for net product sales of $110 million to $125 million and
adjusted EBITDA1 of $20 million to $30 million,” concluded
Mason.
Financial Highlights (unaudited):
|
Three Months Ended |
(in millions, except per share
amounts) |
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
Net Product Sales (GAAP) |
$ |
31.9 |
|
|
$ |
32.5 |
|
|
$ |
41.8 |
|
Net Loss
(GAAP) |
$ |
(4.5 |
) |
|
$ |
(57.4 |
) |
|
$ |
(3.5 |
) |
Loss Per Share
(GAAP) |
$ |
(0.05 |
) |
|
$ |
(0.61 |
) |
|
$ |
(0.07 |
) |
Adjusted EBITDA
(Non-GAAP)2 |
$ |
7.4 |
|
|
$ |
4.5 |
|
|
$ |
25.6 |
|
Adjusted Earnings Per
Share (Non-GAAP)2 |
$ |
0.04 |
|
|
$ |
0.11 |
|
|
$ |
0.29 |
|
First quarter results included the following
highlights (our discussion below focuses on a comparison of first
quarter 2024 to fourth 2023 given the acquisition of Spectrum and
the generic competition of Indocin in third quarter 2023):
- Rolvedon net product sales increased to $14.5 million in the
first quarter 2024, from $11.0 million in the fourth quarter 2023,
(the first full quarter of Rolvedon sales at Assertio) driven by
volume growth.
- Indocin net product sales in the first quarter 2024 were $8.7
million, decreased from $10.8 million in the fourth quarter 2023,
driven by generic competition that affected both volume and
pricing.
- Gross margin3 in the first quarter
2024 was 65% and included $4.1 million of amortization of Rolvedon
purchase accounting inventory step-up amortization. Excluding
step-up amortization, gross margin in the first quarter was 78%
compared to 79% in fourth quarter 2023.
- SG&A expense in the first
quarter 2024 was $18.5 million, decreased from $24.0 million in the
fourth quarter 2023, benefiting from actions the Company has taken
to reduce and align expenses to its current portfolio.
- Adjusted EBITDA was $7.4 million in
the first quarter 2024, increased from $4.5 million in the fourth
quarter 2023, primarily due to the impact of lower SG&A
expense.
Balance Sheet and Cash Flow
- Assertio generated approximately
$7.5 million in cash flow from operations in the first quarter of
2024.
- For the quarter ended
March 31, 2024, cash and cash equivalents totaled
$80.7 million,
- Convertible debt outstanding
principal balance at March 31, 2024 was $40 million and does
not mature until September 2027.
2024 Full Year Financial Guidance
Assertio reiterated its 2024 operating guidance as announced on
March 11, 2024:
Net Product Sales (GAAP) |
$110.0 Million to $125.0 Million |
Adjusted EBITDA (Non-GAAP)4 |
$20.0 Million to $30.0 Million |
Conference Call and Investor Presentation
Information
Assertio’s management will host a conference call to discuss its
first quarter 2024 financial results today:
Date: |
Monday, May 6, 2024 |
Time: |
4:30 p.m. Eastern Time |
Webcast (live and archive): |
http://investor.assertiotx.com/overview/default.aspx (Events
& Webcasts, Investor Page) |
Dial-in numbers: |
1-646-307-1963, Conference ID 4502314 |
To access the live webcast, the recorded
conference call replay, and other materials, please visit
Assertio’s investor relations website at
http://investor.assertiotx.com/overview/default.aspx. Please
connect at least 15 minutes prior to the live webcast to ensure
adequate time for any software download that may be needed to
access the webcast. The replay will be available approximately two
hours after the call on Assertio’s investor website.
About Assertio
Assertio is a commercial pharmaceutical company
with comprehensive commercial capabilities offering differentiated
products to patients. We have built our commercial portfolio
through acquisition or licensing of approved products. Our
commercial capabilities include marketing through both a sales
force and a non-personal promotion model, market access through
payor contracting, and trade and distribution. To learn more about
Assertio, visit www.assertiotx.com.
Investor Contact
Matt Kreps, Managing DirectorDarrow AssociatesM:
214-597-8200mkreps@darrowir.com
Forward Looking Statements
The statements in this communication include
forward-looking statements. Forward-looking statements may discuss
goals, intentions and expectations as to future plans, trends,
events, results of operations or financial condition, or otherwise,
based on current beliefs. Forward-looking statements speak only as
of the date they are made or as of the dates indicated in the
statements and should not be relied upon as predictions of future
events, as there can be no assurance that the events or
circumstances reflected in these statements will be achieved or
will occur. Forward-looking statements can often, but not always,
be identified by the use of forward-looking terminology including
such as “anticipate,” “approximate”, “believe,” “could,”
“estimate,” “expect,” “goal,” “intend,” “may,” “might,”
“opportunity,” “plan,” “potential,” “project,” “prospective,”
“pursue,” “seek,” “should,” “strategy,” “target,” “will,” or the
negative of these words and phrases, other variations of these
words and phrases or comparable terminology. These forward-looking
statements involve risks and uncertainties that could cause actual
results to differ materially from those contemplated by the
statements, including: Assertio’s ability to grow sales of Rolvedon
and the commercial success and market acceptance of Rolvedon and
Assertio’s other products; Assertio’s ability to successfully
develop and execute its sales, marketing and promotion strategies
using its sales force and non-personal promotion model
capabilities; the impact on sales and profits from the entry and
sales of generics of Assertio’s products and/or other products
competitive with any of Assertio’s products (including indomethacin
suppositories compounded by hospitals and other institutions
including a 503B compounder which we believe to be violation of
certain provisions of the Food, Drug and Cosmetic Act); the timing
and impact of additional generic approvals and uncertainty around
the recent approvals and launches of generic Indocin products
(which are not patent protected and now face generic competition as
a result of the August 2023 approval and launch of generic
indomethacin suppositories and January 2024 approval and subsequent
launch of a generic indomethacin oral suspension product); risks
that any new businesses will not be integrated successfully or that
the combined company will not realize estimated cost savings, value
of certain tax assets, synergies and growth, or that such benefits
may take longer and/or cost more to realize than expected; expected
industry trends, including pricing pressures and managed healthcare
practices; Assertio’s ability to attract and retain executive
leadership and key employees, including in connection with our
ongoing search for a permanent CEO; the ability of Assertio’s
third-party manufacturers to manufacture adequate quantities of
commercially salable inventory and active pharmaceutical
ingredients for each of Assertio’s products on commercially
reasonable terms and in compliance with their contractual
obligations to Assertio, and Assertio’s ability to maintain its
supply chain which relies on single-source suppliers; the outcome
of, and Assertio’s intentions with respect to, any litigation or
government investigations, including pending and potential future
shareholder litigation relating to the Spectrum Merger and/or the
recent approval and launch of generic indomethacin suppositories,
antitrust litigation, opioid-related government investigations and
opioid-related litigation, as well as Spectrum’s legacy shareholder
and other litigation and, and other disputes and litigation, and
the costs and expenses associated therewith; Assertio’s financial
cost and outcomes of clinical trials, including the extent to which
data from the Rolvedon same-day dosing trial, if and when
completed, may support ongoing commercialization efforts;
Assertio’s compliance with legal and regulatory requirements
related to the development or promotion of its products; variations
in revenues obtained from commercialization agreements and the
accounting treatment with respect thereto; Assertio’s common stock
maintaining compliance with The Nasdaq Capital Market’s minimum
closing bid requirement of at least $1.00 per share, particularly
in light of Assertio’s stock trading below or only slight above
$1.00 per share recently; and Assertio’s ability to obtain and
maintain intellectual property protection for its products and
operate its business without infringing the intellectual property
rights of others. For a discussion of additional factors that could
cause actual results to differ materially from those contemplated
by forward-looking statements, see the risks described in
Assertio’s Annual Report on Form 10-K, Quarterly Reports on Form
10-Q and other filings with the Securities and Exchange Commission.
Many of these risks and uncertainties may be exacerbated by public
health emergencies and general macroeconomic conditions. Assertio
does not assume, and hereby disclaims, any obligation to update
forward-looking statements, except as may be required by law.
Non-GAAP Financial Measures
To supplement the Company’s financial results
presented on a U.S. generally accepted accounting principles
(“GAAP”) basis, the Company has included information about non-GAAP
measures of EBITDA, adjusted EBITDA, adjusted earnings, and
adjusted earnings per share as useful operating metrics. The
Company believes that the presentation of these non-GAAP financial
measures, when viewed with results under GAAP and the accompanying
reconciliation, provides supplementary information to analysts,
investors, lenders, and the Company’s management in assessing the
Company’s performance and results from period to period. The
Company uses these non-GAAP measures internally to understand,
manage and evaluate the Company’s performance, and in part, in the
determination of bonuses for executive officers and employees.
These non-GAAP financial measures should be considered in addition
to, and not a substitute for, or superior to, net income or other
financial measures calculated in accordance with GAAP. Non-GAAP
financial measures used by us may be calculated differently from,
and therefore may not be comparable to, non-GAAP measures used by
other companies.
This release also includes estimated full-year
non-GAAP adjusted EBITDA information, which the Company believes
enables investors to better understand the anticipated performance
of the business, but should be considered a supplement to, and not
as a substitute for or superior to, financial measures calculated
in accordance with GAAP. No reconciliation of estimated non-GAAP
adjusted EBITDA to estimated net income is provided in this release
because some of the information necessary for estimated net income
such as income taxes, fair value change in contingent
consideration, and stock-based compensation is not yet
ascertainable or accessible and the Company is unable to quantify
these amounts that would be required to be included in estimated
net income without unreasonable efforts.
Specified Items
Non-GAAP measures presented within this release
exclude specified items. The Company considers specified items to
be significant income/expense items not indicative of current
operations. Specified items may include adjustments to interest
expense and interest income, income tax expense (benefit),
depreciation expense, amortization expense, sales reserves
adjustments for products the Company is no longer selling,
stock-based compensation expense, fair value adjustments to
contingent consideration or derivative liability, restructuring
charges, amortization of fair value inventory step-up as a result
of purchase accounting, transaction-related costs, gains, losses or
impairments from adjustments to long-lived assets and assets not
part of current operations, changes in valuation allowances on
deferred tax assets, and gains or losses resulting from debt
refinancing or extinguishment.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE
LOSS |
(in thousands, except per share amounts) |
(unaudited) |
|
|
Three Months Ended |
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
Revenues: |
|
|
|
|
|
Product sales, net |
$ |
31,862 |
|
|
$ |
32,462 |
|
|
$ |
41,769 |
|
Royalties and milestones |
|
586 |
|
|
|
523 |
|
|
|
697 |
|
Total revenues |
|
32,448 |
|
|
|
32,985 |
|
|
|
42,466 |
|
Costs and expenses: |
|
|
|
|
|
Cost of sales |
|
11,177 |
|
|
|
9,721 |
|
|
|
5,467 |
|
Research and development expenses |
|
733 |
|
|
|
1,024 |
|
|
|
— |
|
Selling, general and administrative expenses |
|
18,524 |
|
|
|
23,958 |
|
|
|
16,904 |
|
Change in fair value of contingent consideration |
|
— |
|
|
|
(17,414 |
) |
|
|
9,167 |
|
Amortization of intangible assets |
|
5,631 |
|
|
|
4,775 |
|
|
|
6,284 |
|
Loss on impairment of intangible assets |
|
— |
|
|
|
40,808 |
|
|
|
— |
|
Restructuring charges |
|
720 |
|
|
|
2,442 |
|
|
|
— |
|
Total costs and expenses |
|
36,785 |
|
|
|
65,314 |
|
|
|
37,822 |
|
(Loss) income from
operations |
|
(4,337 |
) |
|
|
(32,329 |
) |
|
|
4,644 |
|
Other (expense) income: |
|
|
|
|
|
Debt-related expenses |
|
— |
|
|
|
— |
|
|
|
(9,918 |
) |
Interest expense |
|
(757 |
) |
|
|
(755 |
) |
|
|
(1,122 |
) |
Other gain |
|
716 |
|
|
|
1,179 |
|
|
|
802 |
|
Total other expense
(income) |
|
(41 |
) |
|
|
424 |
|
|
|
(10,238 |
) |
Net loss before income
taxes |
|
(4,378 |
) |
|
|
(31,905 |
) |
|
|
(5,594 |
) |
Income tax (expense)
benefit |
|
(132 |
) |
|
|
(25,479 |
) |
|
|
2,110 |
|
Net loss and comprehensive loss |
$ |
(4,510 |
) |
|
$ |
(57,384 |
) |
|
$ |
(3,484 |
) |
|
|
|
|
|
|
Basic and diluted net loss per
share |
$ |
(0.05 |
) |
|
$ |
(0.61 |
) |
|
$ |
(0.07 |
) |
Shares used in computing basic
and diluted net loss per share |
|
94,980 |
|
|
|
94,669 |
|
|
|
51,005 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
(in thousands, except share and per share
data) |
|
|
(unaudited) |
|
|
|
March 31, 2024 |
|
December 31, 2023 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
80,743 |
|
|
$ |
73,441 |
|
Accounts receivable, net |
|
42,610 |
|
|
|
47,663 |
|
Inventories, net |
|
38,602 |
|
|
|
37,686 |
|
Prepaid and other current assets |
|
10,519 |
|
|
|
12,272 |
|
Total current assets |
|
172,474 |
|
|
|
171,062 |
|
Property and equipment,
net |
|
704 |
|
|
|
770 |
|
Intangible assets, net |
|
105,701 |
|
|
|
111,332 |
|
Other long-term assets |
|
3,086 |
|
|
|
3,255 |
|
Total assets |
$ |
281,965 |
|
|
$ |
286,419 |
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
15,650 |
|
|
$ |
13,439 |
|
Accrued rebates, returns and discounts |
|
57,870 |
|
|
|
58,137 |
|
Accrued liabilities |
|
15,401 |
|
|
|
18,213 |
|
Contingent consideration, current portion |
|
2,700 |
|
|
|
2,700 |
|
Other current liabilities |
|
823 |
|
|
|
954 |
|
Total current liabilities |
|
92,444 |
|
|
|
93,443 |
|
Long-term debt |
|
38,621 |
|
|
|
38,514 |
|
Other long-term
liabilities |
|
16,406 |
|
|
|
16,459 |
|
Total liabilities |
|
147,471 |
|
|
|
148,416 |
|
Commitments and
contingencies |
|
|
|
Shareholders’ equity: |
|
|
|
Common stock, $0.0001 par value, 200,000,000 shares authorized;
95,115,452 and 94,668,523 shares issued and outstanding as of
March 31, 2024 and December 31, 2023, respectively. |
|
9 |
|
|
|
9 |
|
Additional paid-in capital |
|
790,538 |
|
|
|
789,537 |
|
Accumulated deficit |
|
(656,053 |
) |
|
|
(651,543 |
) |
Total shareholders’ equity |
|
134,494 |
|
|
|
138,003 |
|
Total liabilities and
shareholders' equity |
$ |
281,965 |
|
|
$ |
286,419 |
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(unaudited) |
|
|
Three Months Ended March 31, |
|
2024 |
|
2023 |
Operating
Activities |
|
|
|
Net loss |
$ |
(4,510 |
) |
|
$ |
(3,484 |
) |
Adjustments to reconcile net
loss to net cash from operating activities: |
|
|
|
Depreciation and amortization |
|
5,696 |
|
|
|
6,484 |
|
Amortization of debt issuance costs and Royalty Rights |
|
107 |
|
|
|
147 |
|
Recurring fair value measurements of assets and liabilities |
|
— |
|
|
|
9,167 |
|
Debt-related expenses |
|
— |
|
|
|
9,918 |
|
Provisions for inventory and other assets |
|
1,428 |
|
|
|
1,072 |
|
Stock-based compensation |
|
1,207 |
|
|
|
2,446 |
|
Deferred income taxes |
|
— |
|
|
|
(1,367 |
) |
Changes in assets and
liabilities: |
|
|
|
Accounts receivable |
|
5,054 |
|
|
|
(1,109 |
) |
Inventories |
|
(2,344 |
) |
|
|
(3,602 |
) |
Prepaid and other assets |
|
1,921 |
|
|
|
1,824 |
|
Accounts payable and other accrued liabilities |
|
(134 |
) |
|
|
(290 |
) |
Accrued rebates, returns and discounts |
|
(267 |
) |
|
|
2,887 |
|
Interest payable |
|
(650 |
) |
|
|
(1,376 |
) |
Net cash provided by operating activities |
|
7,508 |
|
|
|
22,717 |
|
Investing
Activities |
|
|
|
Purchase of Sympazan |
|
— |
|
|
|
(105 |
) |
Net cash used in investing activities |
|
— |
|
|
|
(105 |
) |
Financing
Activities |
|
|
|
Payments in connection with
2027 Convertible Notes |
|
— |
|
|
|
(10,500 |
) |
Payment of direct transaction
costs related to convertible debt inducement |
|
— |
|
|
|
(1,119 |
) |
Payment of contingent
consideration |
|
— |
|
|
|
(6,609 |
) |
Payments related to the
vesting and settlement of equity awards, net |
|
(206 |
) |
|
|
(722 |
) |
Net cash used in financing activities |
|
(206 |
) |
|
|
(18,950 |
) |
Net increase in cash and cash
equivalents |
|
7,302 |
|
|
|
3,662 |
|
Cash and cash equivalents at
beginning of year |
|
73,441 |
|
|
|
64,941 |
|
Cash and cash equivalents at
end of period |
$ |
80,743 |
|
|
$ |
68,603 |
|
Supplemental
Disclosure of Cash Flow Information |
|
|
|
Net cash paid for income taxes |
$ |
11 |
|
|
$ |
29 |
|
Cash paid for interest |
$ |
1,300 |
|
|
$ |
2,351 |
|
|
|
|
|
|
|
|
|
RECONCILIATION OF GAAP NET LOSS TO NON-GAAP EBITDA and
ADJUSTED EBITDA |
(in thousands) |
(unaudited) |
|
|
|
Three Months Ended |
|
|
|
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
|
Financial Statement Classification |
GAAP Net Loss |
|
$ |
(4,510 |
) |
|
$ |
(57,384 |
) |
|
$ |
(3,484 |
) |
|
|
Interest expense |
|
|
757 |
|
|
|
755 |
|
|
|
1,122 |
|
|
Interest expense |
Income tax expense (benefit) |
|
|
132 |
|
|
|
25,479 |
|
|
|
(2,110 |
) |
|
Income tax (expense)
benefit |
Depreciation expense |
|
|
65 |
|
|
|
132 |
|
|
|
200 |
|
|
Selling, general and
administrative expenses |
Amortization of intangible assets |
|
|
5,631 |
|
|
|
4,775 |
|
|
|
6,284 |
|
|
Amortization of intangible
assets |
EBITDA
(Non-GAAP) |
|
$ |
2,075 |
|
|
|
(26,243 |
) |
|
$ |
2,012 |
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
1,207 |
|
|
|
2,642 |
|
|
|
2,446 |
|
|
Selling, general and
administrative expenses |
Change in fair value of contingent consideration (1) |
|
|
— |
|
|
|
(17,414 |
) |
|
|
9,167 |
|
|
Change in fair value of
contingent consideration |
Debt-related expenses (2) |
|
|
— |
|
|
|
— |
|
|
|
9,918 |
|
|
Debt-related expenses |
Transaction-related expenses (3) |
|
|
— |
|
|
|
361 |
|
|
|
2,355 |
|
|
Selling, general and
administrative expenses |
Loss on impairment of intangible assets (4) |
|
|
— |
|
|
|
40,808 |
|
|
|
— |
|
|
Loss on impairment of
intangible assets |
Restructuring costs(5) |
|
|
720 |
|
|
|
2,442 |
|
|
|
— |
|
|
Restructuring charges |
Other (6) |
|
|
3,377 |
|
|
|
1,855 |
|
|
|
(295 |
) |
|
Multiple |
Adjusted EBITDA
(Non-GAAP) |
|
$ |
7,379 |
|
|
$ |
4,451 |
|
|
$ |
25,603 |
|
|
|
(1) |
|
The fair value of the contingent
consideration is remeasured each reporting period, with changes in
the fair value resulting from changes in the underlying inputs
being recognized as a benefit or expense in operating expenses
until the contingent consideration arrangement is settled. |
|
|
|
(2) |
|
Debt-related expenses in the
three months ended March 31, 2023 consist of an induced conversion
expense of approximately $8.8 million and direct transaction
costs of approximately $1.1 million incurred as a result of
the privately negotiated exchange of $30.0 million principal amount
of the Company’s 6.5% Convertible Senior Notes due 2027. |
|
|
|
(3) |
|
Represents transaction-related
expenses associated with the acquisition of Spectrum, which closed
effective July 31, 2023. |
|
|
|
(4) |
|
Represents the loss recognized in
the period for the impairment of intangible assets. |
|
|
|
(5) |
|
Restructuring costs represent
non-recurring costs associated with the Company’s announced
restructuring plans. |
|
|
|
(6) |
|
Other for the three months ended
March 31, 2024, December 31, 2023 and March 31, 2023
represents the following adjustments (in thousands): |
|
|
|
|
|
Three Months Ended |
|
|
|
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
|
Financial Statement Classification |
Amortization of inventory step-up |
|
$ |
4,088 |
|
|
$ |
3,001 |
|
|
$ |
164 |
|
|
Cost of sales |
Interest income on cash equivalents |
|
|
(711 |
) |
|
|
(690 |
) |
|
|
(459 |
) |
|
Other gain (loss) |
Derivative fair value adjustment |
|
|
— |
|
|
|
(456 |
) |
|
|
— |
|
|
Other gain (loss) |
Total Other |
|
$ |
3,377 |
|
|
$ |
1,855 |
|
|
$ |
(295 |
) |
|
|
|
RECONCILIATION OF GAAP NET LOSS and NET LOSS PER SHARE
TO |
NON-GAAP ADJUSTED EARNINGS and ADJUSTED EARNINGS
PER SHARE (1) |
(in thousands, except per share amounts) |
(unaudited) |
|
|
Three Months Ended |
|
March 31, 2024 |
|
December 31, 2023 |
|
March 31, 2023 |
|
Amount |
|
Diluted EPS (2) |
|
Amount |
|
Diluted EPS (2) |
|
Amount |
|
Diluted EPS (2) |
Net loss (GAAP)(2) |
$ |
(4,510 |
) |
|
$ |
(0.05 |
) |
|
$ |
(57,384 |
) |
|
$ |
(0.61 |
) |
|
$ |
(3,484 |
) |
|
$ |
(0.07 |
) |
Add: Convertible debt interest
expense and other income statement impacts, net of tax(2) |
|
— |
|
|
|
|
|
566 |
|
|
|
|
|
842 |
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
Amortization of intangible assets |
$ |
5,631 |
|
|
|
|
|
4,775 |
|
|
|
|
$ |
6,284 |
|
|
|
Stock-based compensation |
|
1,207 |
|
|
|
|
|
2,642 |
|
|
|
|
|
2,446 |
|
|
|
Debt-related expenses, net |
|
— |
|
|
|
|
|
— |
|
|
|
|
|
9,639 |
|
|
|
Change in fair value of contingent consideration |
|
— |
|
|
|
|
|
(17,414 |
) |
|
|
|
|
9,167 |
|
|
|
Contingent consideration cash payable (3) |
|
— |
|
|
|
|
|
(2,170 |
) |
|
|
|
|
(2,069 |
) |
|
|
Transaction-related expenses |
|
— |
|
|
|
|
|
361 |
|
|
|
|
|
2,355 |
|
|
|
Loss on impairment of intangible assets |
|
— |
|
|
|
|
|
40,808 |
|
|
|
|
|
— |
|
|
|
Restructuring costs |
|
720 |
|
|
|
|
|
2,442 |
|
|
|
|
|
— |
|
|
|
Other |
|
3,377 |
|
|
|
|
|
1,855 |
|
|
|
|
|
(295 |
) |
|
|
Increase in deferred tax asset valuation allowance (4) |
|
— |
|
|
|
|
|
33,165 |
|
|
|
|
|
— |
|
|
|
Income tax benefit expense, as adjusted (5) |
|
(2,734 |
) |
|
|
|
|
1,877 |
|
|
|
|
|
(4,472 |
) |
|
|
Adjusted earnings
(Non-GAAP) |
$ |
3,691 |
|
|
$ |
0.04 |
|
|
$ |
11,523 |
|
|
$ |
0.11 |
|
|
$ |
20,413 |
|
|
$ |
0.29 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares used in
calculation (GAAP)(2) |
|
94,980 |
|
|
|
|
|
94,669 |
|
|
|
|
|
51,005 |
|
|
|
Add: Dilutive effect of
stock-based awards and equivalents(2) |
|
271 |
|
|
|
|
|
325 |
|
|
|
|
|
4,436 |
|
|
|
Add: Dilutive effect of 2027
Convertible Notes(2) |
|
— |
|
|
|
|
|
9,768 |
|
|
|
|
|
14,489 |
|
|
|
Diluted shares used in
calculation (Non-GAAP)(2) |
|
95,251 |
|
|
|
|
|
104,762 |
|
|
|
|
|
69,930 |
|
|
|
(1) |
|
Certain adjustments included here are the same as those reflected
in the Company’s reconciliation of GAAP net loss to non-GAAP
adjusted EBITDA and therefore should be read in conjunction with
that reconciliation and respective footnotes. |
|
|
|
(2) |
|
The Company uses the if-converted method with respect to its
convertible debt to compute GAAP and Non-GAAP diluted earnings per
share when the effect is dilutive. Under the if-converted method,
the Company assumes the 2027 Convertible Notes were converted at
the beginning of each period presented and outstanding. As a
result, interest expense, net of tax, and any other income
statement impact associated with the 2027 Convertible Notes, net of
tax, is added back to net income used in the diluted earnings per
share calculation. |
|
|
|
|
|
For the three months ended March 31, 2024, the Company’s
potentially dilutive convertible debt under the if-converted method
and stock-based awards under the treasury-stock method were not
included in the computation of GAAP net loss diluted net loss per
share, and the potentially dilutive convertible debt under the
if-converted method were not included in non-GAAP adjusted earnings
and adjusted earnings per share, because to do so would be
anti-dilutive. However, the potentially dilutive stock-based awards
under the treasury-stock method were included in the computation of
non-GAAP adjusted earnings and adjusted earnings per share because
the effect was dilutive. |
|
|
|
|
|
For both the three months ended December 31, 2023 and the three
months ended March 31, 2023, the Company’s potentially dilutive
convertible debt under the if-converted method and potentially
dilutive stock-based awards under the treasury-stock method were
not included in the computation of GAAP diluted net loss per share,
because to do so would be anti-dilutive. However, the Company’s
potentially dilutive convertible debt under the if-converted method
and the potentially dilutive stock-based awards under the
treasury-stock method were included in the computation of non-GAAP
adjusted earnings and adjusted earnings per share because their
effect was dilutive. |
|
|
|
(3) |
|
Represents the accrued cash payable, if any, of the INDOCIN
contingent consideration for the respective period based on 20%
royalty for annual INDOCIN net sales over $20.0 million. |
|
|
|
(4) |
|
For the three months ended December 31, 2023, represents the amount
of income tax expense related to the recognition of a full
valuation allowance against deferred tax assets. |
|
|
|
(5) |
|
Represents the Company’s income tax expense adjustment from the tax
effect of pre-tax adjustments excluded from adjusted earnings. The
tax effect of pre-tax adjustments excluded from adjusted earnings
is computed at the blended federal and state statutory rate of
25%. |
1 See “Non-GAAP Financial Measures” below for information about
reconciling our Adjusted EBITDA guidance to Net Loss.2 Non-GAAP
measures are reconciled to the corresponding GAAP measures in the
schedules attached.3 Gross margin represents the ratio of net
product sales less cost of sales to net product sales.4 See
“Non-GAAP Financial Measures” below for information about
reconciling our Adjusted EBITDA guidance to Net Loss.
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