Highlights Include Record Quarterly Net Sales, Additional
Strategic Agreements, ANDA Filings and Tentative Approvals
July 25, 2002 -- IMPAX Laboratories, Inc. (Nasdaq NM: IPXL) today reported
financial results for the three months and six months ended June 30, 2002.
The net sales for the second quarter of 2002 were $5,145,000 compared with
$1,136,000 in the prior year's second quarter and $3,432,000 in the first quarter
of 2002. The increase in net sales by approximately 350% over the prior year
was primarily due to the March 2002 introduction of a new product, Fludrocortisone
Acetate Tablets, as well as other products introduced since July 2001, such
as Terbutaline Sulfate Tablets.
The net loss for the 2002 second quarter was $5,938,000 or $(0.13) per share,
compared with a net loss of $6,150,000 or $(0.15) per share in the prior year
second quarter, including goodwill amortization expenses of approximately $876,000
or $(0.02) per share. Higher net sales in the 2002 second quarter partially
offset the increase in research and development and in infrastructure costs
related to the Company's manufacturing facility in Hayward, California.
For the six months ended June 30, 2002, the Company reported net sales of $8,577,000,
compared with $2,908,000 in the comparable period the previous year. The net
loss for the first half of 2002 was $11,359,000, or $(0.24) per share. This
compares with a net loss of $11,488,000, or ($0.31) per share in the prior year's
six months, including goodwill amortization expense of approximately $1,752,000
or $(0.05) per share.
Cash, cash equivalents and short-term investments were $28.4 million at June
30, 2002, compared with $35.5 million at December 31, 2001. During the quarter,
IMPAX issued 463,135 shares of common stock to a subsidiary of Teva Pharmaceuticals
Industries, Ltd., for net proceeds to the Company of $3.75 million. Under the
terms of a strategic alliance announced in June 2001, TEVA has made significant
investments in IMPAX totaling $15 million under a fixed schedule through June
2002. Through these investments, TEVA purchased a total of 1,462,083 shares,
or approximately 3% of total shares of common stock outstanding. A Form S-3
Registration Statement registering these shares was filed with the Securities
and Exchange Commission (SEC) on July 23, 2002.
"We are delighted with our growth in net sales, owing to an increasing
portfolio of marketed products, and look forward to continue bringing new generic
drugs to market," said Barry R. Edwards, Co-Chief Executive Officer. "Second
quarter highlights include the tentative approval by the U.S. Food and Drug
Administration (FDA) of our ANDAs for generic versions of Claritin-D® 24-Hour
(loratadine/pseudoephedrine sulfate, 10mg/240mg) Extended Release Tablets, and
Claritin-D® 12-Hour (loratadine/pseudoephedrine sulfate, 5mg/120mg) Extended
Release Tablets. Subsequent to the close of the quarter, we also received tentative
approval from the FDA of our ANDA for a generic version of Rilutek® (Riluzole)
50mg tablets.
"In addition, we signed two significant agreements last quarter: one regarding
the loratadine/pseudoephedrine sulfate products for the OTC market with Wyeth;
and the second one, a Manufacturing and Supply Agreement with Schering relating
to Claritin D® 12-Hour for the OTC market."
Larry Hsu, Ph.D., President and Chief Operating Officer, stated: "In the
second quarter, we filed three new ANDAs for generic versions of undisclosed
branded products, one of which was made under Paragraph IV of the Hatch-Waxman
Amendments. We are, therefore, on track with our plans of filing a total of
six to eight ANDAs this year."
While the Company submitted its first brand filing as an ANDA during the quarter,
based on discussions with FDA regarding the file, IMPAX subsequently withdrew
the application and is planning to resubmit it as an NDA. Additionally, good
progress has been made in formulation development for three other brand products
with IND filings scheduled during the next 12 months for at least two of the
three products.
IMPAX currently has 17 ANDAs pending at the FDA that address more than $9 billion
in 2001 U.S. branded product sales. Ten of these filings were made under Paragraph
IV of the Hatch-Waxman Amendments, and four of these 17 ANDAs now have received
tentative approval from the FDA.
IMPAX Laboratories, Inc. is a technology focused specialty pharmaceutical company
applying its formulation expertise and drug delivery technology to the development
of controlled-release and niche generics in addition to the development of branded
products. IMPAX markets its generic products through its Global Pharmaceuticals
division and intends to market its branded products through the IMPAX Pharmaceuticals
division. IMPAX Laboratories is headquartered in Hayward, California, and has
a full range of capabilities in its Hayward and Philadelphia facilities. For
more information, please visit the Company's Web site at: www.impaxlabs.com.
IMPAX LABORATORIES, INC.
STATEMENTS OF OPERATIONS
(unaudited)
(dollars in thousands, except share and per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2002 2001 2002 2001
Net sales $5,145 $1,136 $8,577 $2,908
Cost of sales 3,982 1,992 7,121 4,268
Gross margin (loss) 1,163 (856) 1,456 (1,360)
Research and development 4,476 2,415 7,366 5,010
Less: Teva reimbursements (138) -- (304) --
Research and development,
net 4,338 2,415 7,062 5,010
Selling 646 806 1,304 1,123
General and
administrative(a) 1,939 2,236 4,109 4,395
Other operating income
(expense), net 21 39 (9) 64
Net loss from operations (5,739) (6,274) (11,028) (11,824)
Interest income 167 161 402 423
Interest expense(b) (366) (37) (733) (87)
Net loss $(5,938) $(6,150) $(11,359) $(11,488)
Net loss per share
(basic and diluted) $(0.13) $(0.15) $(0.24) $(0.31)
Weighted average common
shares outstanding 47,306,741 41,138,673 47,061,223 37,565,128
(a) Includes amortization of goodwill of $876,000 in the quarter
ended June 30, 2001 and $1,752,000 in the six months ended June
30, 2001. There was no amortization of goodwill in 2002.
(b) The total interest expense of $366K for the quarter ended June
30, 2002, which was reduced by $222K in capitalized interest,
included interest of $438K on the refundable deposit from Teva.
The total interest of $733K for the six months ended June 30,
2002, which was reduced by $394K in capitalized interest, included
interest of $876K on the refundable deposit from Teva.
IMPAX LABORATORIES, INC.
CONDENSED BALANCE SHEET
(in thousands)
June 30, December 31,
2002 2001
(unaudited)
ASSETS
Cash, cash equivalents and short-term
investments $28,400 $35,466
Accounts receivable, net 4,561 3,523
Inventory 4,688 3,488
Property, plant and equipment, net 31,398 24,334
Goodwill and intangibles, net 28,529 28,721
Other assets 2,025 2,080
Total assets $99,601 $97,612
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $9,579 $7,803
Long-term debt, net of current portion 6,752 6,868
Refundable deposit and related accrued
interest 23,752 22,876
Other liabilities 2,684 117
Mandatorily redeemable convertible
preferred stock 7,500 7,500
Stockholders' equity 49,334 52,448
Total liabilities and
stockholders' equity $99,601 $97,612