On August 8, 2018 INSYS Therapeutics, Inc. (NASDAQ: INSY), a leader in the development, manufacture and commercialization of pharmaceutical cannabinoids (CBD) and spray technology, reported financial results for its second quarter ended June 30, 2018 (Press release, Insys Therapeutics, AUG 8, 2018, View Source;p=RssLanding&cat=news&id=2362910 [SID1234528760]).
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OVERALL HIGHLIGHTS
Reached agreement in principle to settle Department of Justice investigation with financial terms that are consistent with previous public statements and disclosures.
Achieved gross revenue of $38.0 million and net revenue of $23.5 million in the second quarter.
Continued to advance prioritized R&D programs with $16.5 million investment in the second quarter.
Reported encouraging results from pharmacokinetics (PK) study of epinephrine nasal spray as potential product candidate for treatment of anaphylaxis.
Commenced enrolling Phase 2 clinical trial of cannabidiol (CBD) oral solution as potential treatment for Prader-Willi syndrome.
Initiated Phase 3 clinical trial of CBD oral solution as potential treatment for infantile spasms.
Continued enrolling Phase 2 clinical trial of CBD oral solution as potential treatment for childhood absence epilepsy.
Established collaboration partnership with University of California San Diego’s Center for Medicinal Cannabis Research to study CBD oral solution in various disease states, starting with autism.
Received Complete Response Letter from FDA regarding buprenorphine New Drug Application (NDA).
Announced exclusive licensing partnership with Lunatus to commercialize SUBSYS in the Middle East.
"Our continuing commitment to the potential of CBD and our nasal spray technology to significantly improve the lives of patients was highlighted by several important milestones in the second quarter of 2018, as we continue to make progress against our strategic plan," said Saeed Motahari, president and chief executive officer of INSYS Therapeutics. "We received encouraging results from our pharmacokinetics study of epinephrine nasal spray and initiated a Phase 2 study of CBD for Prader-Willi Syndrome. Furthermore, we believe we remain on track to submit an NDA for naloxone nasal spray by the end of 2018. These critical milestones are in keeping with our long-term goal to submit one NDA per year through 2021."
Motahari continued, "Prescriptions for our primary commercial product, SUBSYS, declined at a slower rate than the overall TIRF market in the second quarter. Our commercial efforts are showing signs of traction, as we gained prescription share in the TIRF market sequentially for the first time in seven quarters. These efforts include new managed care wins, patient education, upgrading the salesforce talent and optimizing territory alignment."
Motahari added, "Albeit off a small base, prescriptions of SYNDROS experienced a solid improvement in the second quarter as net revenue improved 56 percent sequentially, driven by the initial success of our patient access and educational programs. We remain resolute in our commitment to patients who rely on SYNDROS and SUBSYS and believe our product pipeline has the potential to significantly improve the lives of patients with unmet medical needs—particularly our two life-saving drug candidates, epinephrine and naloxone nasal sprays."
Financial & Operating Highlights
Gross revenue for the second quarter of 2018 of $38.0 million, compared to $58.2 million for the second quarter of 2017 driven primarily by declines in the TIRF market, but slightly offset by market share gains in the second quarter of 2018.
Net revenue for the second quarter of 2018 was $23.5 million, compared to $42.6 million for the second quarter of 2017, as a result of lower gross revenue and returns of expired product.
Gross margin was 84.7 percent for the second quarter of 2018, compared to 90.8 percent in the same period of 2017.
Sales and marketing investment was $9.1 million for the second quarter of 2018, compared to $13.3 million for the second quarter of 2017.
Research and development investment increased to $16.5 million for the second quarter of 2018, compared to $14.1 million for the second quarter of 2017.
General and administrative expense of $10.9 million for the second quarter of 2018, compared to $10.6 million in the second quarter of 2017.
Legal expense increased to $11.1 million for the second quarter of 2018, compared to $6.5 million in the second quarter of 2017.
Income tax expense was $0.1 million for the second quarter of 2018 compared to a benefit of $1.7 million during the second quarter of 2017.
Net loss for the second quarter of 2018 was ($27.4 million), or ($0.37) per basic and diluted share, compared to a net loss of ($8.2 million), or ($0.11) per basic and diluted share, for the second quarter of 2017. Adjusted net loss for the quarter was ($0.33) per basic and diluted share.
Adjusted EBITDA loss for the second quarter of 2018 was ($22.5 million), compared to Adjusted EBITDA of $0.3 million in the prior-year quarter. The reconciliation of net income to Adjusted EBITDA is included at the end of this news release.
The Company had $123.5 million in cash, cash equivalents and short-term and long-term investments with no debt as of June 30, 2018.
Webcast Information
A conference call is scheduled for 5:00 p.m. Eastern Standard Time on Aug. 8, 2018, to discuss the financial and operational results for the second quarter 2018. Interested parties can listen to the call live as it occurs via the company’s website, View Source, on the Investors section’s Presentations & Events page; or by dialing 844-263-8304 (from inside the U.S.) or 213-358-0958 (from outside the U.S.), and using the Conference ID 2070039. A webcasted replay of the call will be available on the site a few hours after the event.