Press Releases

Nov 06,2020

Amphastar Pharmaceuticals Reports Financial Results for the Three Months Ended September 30, 2020

Reports Net Revenues of $83.4 Million for the Three Months Ended September 30, 2020

RANCHO CUCAMONGA, Calif., Nov. 06, 2020 (GLOBE NEWSWIRE) -- Amphastar Pharmaceuticals, Inc. (NASDAQ: AMPH) (“Amphastar” or the “Company”) today reported results for the three months ended September 30, 2020.

Third Quarter Highlights

  • Net revenues of $83.4 million for the third quarter
  • GAAP net income of $3.9 million, or $0.08 per share, for the third quarter
  • Adjusted non-GAAP net income of $7.6 million, or $0.15 per share, for the third quarter

Dr. Jack Zhang, Amphastar’s President and Chief Executive Officer, commented: “We once again demonstrated growth due to the continued strength of Primatene Mist® and the re-launch of our epinephrine vial product. Additionally, we are very excited about the significant progress on our intranasal epinephrine product as this product once again illustrates our scientific and technical strengths.”

                           
    Three Months Ended   Nine Months Ended  
    September 30   September 30  
    2020   2019   2020   2019  
       
    (in thousands, except per share data)  
Net revenues   $ 83,431   $ 80,137   $ 253,925   $ 238,974  
GAAP net income attributable to Amphastar   $ 3,919   $ 1,310   $ 7,676   $ 49,965  
Adjusted non-GAAP net income attributable to Amphastar*   $ 7,629   $ 5,169   $ 23,622   $ 14,171  
GAAP diluted EPS attributable to Amphastar stockholders   $ 0.08   $ 0.03   $ 0.16   $ 1.00  
Adjusted non-GAAP diluted EPS attributable to Amphastar stockholders*   $ 0.15   $ 0.10   $ 0.48   $ 0.28  

_________________

 * Adjusted non-GAAP net income attributable to Amphastar and Adjusted non-GAAP diluted EPS attributable to Amphastar stockholders are non-GAAP financial measures.  Please see the discussion in the section entitled “Non-GAAP Financial Measures” and the reconciliation of GAAP to non-GAAP financial measures in Table III of this press release.

Third Quarter Results

                         
    Three Months Ended            
    September 30   Change  
    2020   2019   Dollars   %  
           
    (in thousands)      
Net revenues:                        
Primatene Mist®   $ 12,988   $ 3,654   $ 9,334     255 %    
Enoxaparin     11,647     9,573     2,074     22 %    
Lidocaine     10,657     11,670     (1,013 )   (9)%    
Phytonadione     10,470     10,916     (446 )   (4)%    
Naloxone     8,739     10,613     (1,874 )   (18)%    
Epinephrine     5,370     3,756     1,614     43 %    
Other finished pharmaceutical products     21,464     25,547     (4,083 )   (16)%    
Total finished pharmaceutical products net revenues   $ 81,335   $ 75,729   $ 5,606     7 %    
API     2,096     4,408     (2,312 )   (52)%    
Total net revenues   $ 83,431   $ 80,137   $ 3,294     4 %    
                             

Changes in net revenues were primarily driven by:

  • Increased sales of Primatene Mist® primarily resulting from
    • The continued success of our nationwide television, radio, and digital marketing campaign
    • Growth in online sales through Amazon
    • Launching Primatene Mist® at Kroger, the largest grocery store chain in the United States
  • Increased sales of enoxaparin primarily due to higher unit volumes
  • Increased epinephrine sales due to the launch of our recently approved epinephrine injection, USP 30mg/30mL multi-dose vial product during the second quarter of 2020
  • Decreased naloxone sales due to lower average selling price because of increased competition
  • Decreased lidocaine and other finished pharmaceutical product sales due to lower demand, largely due to competitors returning to their normal distribution levels
                         
    Three Months Ended            
    September 30   Change  
    2020   2019   Dollars   %  
           
    (in thousands)      
Net revenues   $ 83,431   $ 80,137   $ 3,294   4%  
Cost of revenues     46,923     44,885     2,038   5%  
Gross profit   $ 36,508   $ 35,252   $ 1,256   4%  
as % of net revenues     44%     44%            

Changes in cost of revenues and the resulting gross margin were primarily driven by:

  • Increased sales of Primatene Mist® and the launch of epinephrine injection multi-dose vial, both of which have higher margins
  • Decreased sales of naloxone and other finished pharmaceutical products with higher margins
                         
    Three Months Ended            
    September 30   Change  
    2020   2019   Dollars   %  
           
    (in thousands)      
Selling, distribution, and marketing   $ 3,673   $ 3,221   $ 452     14 %  
General and administrative     11,674     11,021     653     6 %  
Research and development     17,644     18,606     (962 )   (5)%  
  • Marketing and distribution expenses increased primarily related to Primatene Mist®, including the cost of a national television, radio and digital marketing campaign, which began in July 2019
  • General and administrative expenses increased primarily due to increased legal expenses
  • Research and development expenses decreased due to lower expenses in China, partially offset by increased domestic expenses related to our generic inhalation product pipeline, our insulin biosimilar programs and our intranasal epinephrine program

Cash flow provided by operating activities for the nine months ended September 30, 2020, was $40.4 million.

Impact of COVID-19

As a result of the COVID-19 pandemic, during the first quarter and second quarter, sales of Primatene Mist® and certain hospital products increased, while sales of certain products frequently used in elective produces, such as Cortrosyn® and lidocaine jelly, decreased. During the third quarter of 2020, sales of these products returned to levels closer to those experienced prior to the COVID-19 pandemic. The Company has not experienced any significant negative impacts on its cash flows or operations as a result of the COVID-19 pandemic. All of the Company’s production facilities continued to operate during the quarter as they had prior to the COVID-19 pandemic with very little change, other than for enhanced safety measures intended to prevent the spread of the virus. It is not possible at this time to estimate the complete impact that the COVID-19 pandemic could have on our business, including our customers and suppliers, as the impact will depend on future developments of the pandemic, which are highly uncertain and cannot be predicted.

Pipeline Information

The Company currently has five ANDAs on file with the FDA targeting products with a market size of approximately $1.5 billion, three biosimilar products in development targeting products with a market size of approximately $13 billion, and nine generic products in development targeting products with a market size of approximately $12 billion. This market information is based on IQVIA data for the 12 months ended September 30, 2020. The Company is currently developing multiple proprietary products for injectable and intranasal dosage forms.

Amphastar’s Chinese subsidiary, ANP, currently has 14 Drug Master Files, or DMFs, on file with the FDA and is developing several additional DMFs.

Company Information

Amphastar is a specialty pharmaceutical company that focuses primarily on developing, manufacturing, marketing, and selling technically-challenging generic and proprietary injectable, inhalation, and intranasal products. Additionally, the Company sells insulin API products. Most of the Company’s finished products are used in hospital or urgent care clinical settings and are primarily contracted and distributed through group purchasing organizations and drug wholesalers. More information and resources are available at www.amphastar.com.

Amphastar’s logo and other trademarks or service marks of Amphastar, including, but not limited to Amphastar®, Primatene Mist®, Amphadase® and Cortrosyn®, are the property of Amphastar.

Non-GAAP Financial Measures

To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company is disclosing non-GAAP financial measures when providing financial results. The Company believes that an evaluation of its ongoing operations (and comparisons of its current operations with historical and future operations) would be difficult if the disclosure of its financial results were limited to financial measures prepared only in accordance with GAAP. As a result, the Company is disclosing certain non-GAAP results, including (i) Adjusted non-GAAP net income (loss) attributed to Amphastar and (ii) Adjusted non-GAAP diluted EPS attributed to Amphastar’s stockholders, which exclude amortization expense, share-based compensation, impairment charges, executive severance expense, and legal settlements, in order to supplement investors’ and other readers’ understanding and assessment of the Company’s financial performance because the Company’s management uses these measures internally for forecasting, budgeting, and measuring its operating performance. Whenever the Company uses such non-GAAP measures, it will provide a reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures. Investors and other readers are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP measures to their most directly comparable GAAP measures set forth below and should consider non-GAAP measures only as a supplement to, not as a substitute for or as a superior measure to, measures of financial performance prepared in accordance with GAAP.

Conference Call Information

The Company will hold a conference call to discuss its financial results today, November 6, 2020, at 9:00 a.m. Pacific Time.

To access the conference call, dial toll-free (877) 881-2595 or (315) 625-3083 for international callers, five minutes before the conference. The passcode for the conference call is 7086853.

The call can also be accessed on the Investors page on the Company’s website at www.amphastar.com

Forward-Looking Statements

All statements in this press release and in the conference call referenced above that are not historical are forward-looking statements, including, among other things, statements relating to the Company’s expectations regarding future financial performance, backlog, sales and marketing of its products, market size and growth, product development, the timing of FDA filings or approvals, including the DMFs of ANP, the timing of product launches, acquisitions and other matters related to its pipeline of product candidates, its share buyback program and other future events, such as the impact of the COVID-19 pandemic and related responses of business and governments to the pandemic on our operations and personnel, and on commercial activity and demand across our business operations and results of operations. These statements are not historical facts but rather are based on Amphastar’s historical performance and its current expectations, estimates, and projections regarding Amphastar’s business, operations, and other similar or related factors. Words such as “may,” “might,” “will,” “could,” “would,” “should,” “anticipate,” “predict,” “potential,” “continue,” “expect,” “intend,” “plan,” “project,” “believe,” “estimate,” and other similar or related expressions are used to identify these forward-looking statements, although not all forward-looking statements contain these words. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and assumptions that are difficult or impossible to predict and, in some cases, beyond Amphastar’s control.  Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in Amphastar’s filings with the Securities and Exchange Commission, including in the Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 16, 2020. In particular, the extent of COVID-19’s impact on our business will depend on several factors, including the severity, duration and extent of the pandemic, as well as actions taken by governments, businesses, and consumers in response to the pandemic, all of which continue to evolve and remain uncertain at this time. You can locate these reports through the Company’s website at http://ir.amphastar.com and on the SEC’s website at www.sec.gov.  The forward-looking statements in this release speak only as of the date of the release. Amphastar undertakes no obligation to revise or update information or any forward-looking statements in this press release or the conference call referenced above to reflect events or circumstances in the future, even if new information becomes available or if subsequent events cause Amphastar’s expectations to change.

Contact Information: 

Amphastar Pharmaceuticals, Inc.
Bill Peters
Chief Financial Officer
(909) 980-9484


Table I
Amphastar Pharmaceuticals, Inc.
Condensed Consolidated Statement of Operations
(Unaudited; in thousands, except per share data)

                           
    Three Months Ended   Nine Months Ended  
    September 30   September 30  
    2020   2019     2020     2019    
                           
Net revenues   $ 83,431   $ 80,137     $ 253,925     $ 238,974    
Cost of revenues     46,923     44,885       147,417       140,432    
Gross profit     36,508     35,252       106,508       98,542    
                           
Operating expenses:                          
Selling, distribution, and marketing     3,673     3,221       10,993       9,354    
General and administrative     11,674     11,021       38,344       39,774    
Research and development     17,644     18,606       49,096       49,209    
Total operating expenses     32,991     32,848       98,433       98,337    
                           
Income from operations     3,517     2,404       8,075       205    
                           
Non-operating income (expenses), net     3,561     (822 )     3,304       58,837    
                           
Income before income taxes     7,078     1,582       11,379       59,042    
Income tax provision     2,285     598       4,490       13,292    
                           
Net income   $ 4,793   $ 984     $ 6,889     $ 45,750    
                           
Net income (loss) attributable to non-controlling interests   $ 874   $ (326 )   $ (787 )   $ (4,215 )  
                           
Net income attributable to Amphastar   $ 3,919   $ 1,310     $ 7,676     $ 49,965    
                           
Net income per share attributable to Amphastar stockholders:                          
Basic   $ 0.08   $ 0.03     $ 0.16     $ 1.06    
Diluted   $ 0.08   $ 0.03     $ 0.16     $ 1.00    
                           
Weighted-average shares used to compute net income per share attributable to Amphastar stockholders:                          
Basic     47,496     47,239       46,886       47,030    
Diluted     49,848     50,075       48,922       50,128    


Table II
Amphastar Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets
(Unaudited; in thousands, except share data)

             
    September 30   December 31
    2020     2019  
    (unaudited)      
ASSETS            
Current assets:            
Cash and cash equivalents   $ 87,910     $ 73,685  
Restricted cash     1,865       1,865  
Short-term investments     10,873       11,675  
Restricted short-term investments     2,200       2,290  
Accounts receivable, net     52,382       45,376  
Inventories     108,870       110,501  
Income tax refunds and deposits     1,455       311  
Prepaid expenses and other assets     10,986       9,538  
Total current assets     276,541       255,241  
             
Property, plant, and equipment, net     245,881       233,856  
Finance lease right-of-use assets     693       887  
Operating lease right-of-use assets     20,256       18,805  
Goodwill and intangible assets, net     40,377       41,153  
Other assets     7,735       11,156  
Deferred tax assets     22,235       25,873  
Total assets   $ 613,718     $ 586,971  
             
LIABILITIES AND STOCKHOLDERS' EQUITY            
Current liabilities:            
Accounts payable and accrued liabilities   $ 79,292     $ 77,051  
Income taxes payable     1,619       2,042  
Current portion of long-term debt     12,167       7,741  
Current portion of operating lease liabilities     3,639       3,175  
Total current liabilities     96,717       90,009  
             
Long-term reserve for income tax liabilities     3,425       3,425  
Long-term debt, net of current portion     32,903       39,394  
Long-term operating lease liabilities, net of current portion     17,534       16,315  
Deferred tax liabilities     823       867  
Other long-term liabilities     11,354       9,433  
Total liabilities     162,756       159,443  
Commitments and contingencies            
Stockholders’ equity:            
Preferred stock: par value $0.0001; 20,000,000 shares authorized; no shares issued and outstanding            
Common stock: par value $0.0001; 300,000,000 shares authorized; 54,623,837 and 47,534,215 shares issued and outstanding as of September 30, 2020 and 52,495,483 and 46,576,968 shares issued and outstanding as of December 31, 2019, respectively     5       5  
Additional paid-in capital     404,084       367,305  
Retained earnings     124,046       116,370  
Accumulated other comprehensive loss     (4,478 )     (4,687 )
Treasury stock     (118,425 )     (97,627 )
Total Amphastar Pharmaceuticals, Inc. stockholders’ equity     405,232       381,366  
Non-controlling interests     45,730       46,162  
Total equity     450,962       427,528  
Total liabilities and stockholders’ equity   $ 613,718     $ 586,971  
                 


Table III
Amphastar Pharmaceuticals, Inc.
Reconciliation of Non-GAAP Measures
(Unaudited; in thousands, except per share data)

                         
    Three Months Ended   Nine Months Ended
    September 30   September 30
    2020     2019     2020     2019  
                         
GAAP net income   $ 4,793     $ 984     $ 6,889     $ 45,750  
Adjusted for:                        
Intangible amortization     262       251       771       777  
Share-based compensation     4,370       4,294       13,846       13,000  
Impairment of long-lived assets     130       11       160       194  
Expense related to executive separation agreement                 4,869        
Gain on litigation settlement                       (59,900 )
Income tax (benefit) provision on pre-tax adjustments     (943 )     (598 )     (3,392 )     10,422  
Non-GAAP net income   $ 8,612     $ 4,942     $ 23,143     $ 10,243  
                         
Non-GAAP net income (loss) attributable to non-controlling interests   $ 983     $ (227 )   $ (479 )   $ (3,928 )
                         
Non-GAAP net income attributable to Amphastar   $ 7,629     $ 5,169     $ 23,622     $ 14,171  
                         
Non-GAAP net income per share attributable to Amphastar stockholders:                        
Basic   $ 0.16     $ 0.11     $ 0.50     $ 0.30  
Diluted   $ 0.15     $ 0.10     $ 0.48     $ 0.28  
                         
Weighted-average shares used to compute non-GAAP net income per share attributable to Amphastar stockholders:                        
Basic     47,496       47,239       46,886       47,030  
Diluted     49,848       50,075       48,922       50,128  


                                           
    Three Months Ended September 30, 2020
                                 
        Selling,   General   Research   Non-operating   Income   Non-controlling
    Cost of   distribution   and   and   income   tax provision   interest
    revenue   and marketing   administrative   development   (expense), net   (benefit)   adjustment
GAAP   $ 46,923     $ 3,673     $ 11,674     $ 17,644     $ 3,561   $ 2,285   $ 874  
Intangible amortization     (229 )           (33 )                   12  
Share-based compensation     (947 )     (120 )     (2,899 )     (404 )             117  
Impairment of long-lived assets     (19 )           (111 )                   8  
Income tax provision (benefit) on pre-tax adjustments                                 943     (28 )
Non-GAAP   $ 45,728     $ 3,553     $ 8,631     $ 17,240     $ 3,561   $ 3,228   $ 983  
                                                     

Reconciliation of Non-GAAP Measures (continued)

                                           
    Three Months Ended September 30, 2019
                                 
        Selling,   General   Research   Non-operating   Income   Non-controlling
    Cost of   distribution   and   and   income   tax provision   interest
    revenue   and marketing   administrative   development   (expense), net   (benefit)   adjustment
GAAP   $ 44,885     $ 3,221     $ 11,021     $ 18,606     $ (822 )   $ 598   $ (326 )
Intangible amortization     (216 )           (35 )                     12  
Share-based compensation     (701 )     (96 )     (3,138 )     (359 )               107  
Impairment of long-lived assets     (4 )           (11 )     4                 6  
Income tax provision (benefit) on pre-tax adjustments                                   598     (26 )
Non-GAAP   $ 43,964     $ 3,125     $ 7,837     $ 18,251     $ (822 )   $ 1,196   $ (227 )
                                                       


                                           
    Nine Months Ended September 30, 2020
                                 
        Selling,   General   Research   Non-operating   Income   Non-controlling
    Cost of   distribution   and   and   income   tax provision   interest
    revenue   and marketing   administrative   development   (expense), net   (benefit)   adjustment
GAAP   $ 147,417     $ 10,993     $ 38,344     $ 49,096     $ 3,304   $ 4,490   $ (787 )
Intangible amortization     (670 )           (101 )                   34  
Share-based compensation     (3,276 )     (350 )     (8,851 )     (1,369 )             330  
Impairment of long-lived assets     (32 )           (128 )                   15  
Expense related to executive separation agreement                 (4,869 )                    
Income tax provision (benefit) on pre-tax adjustments                                 3,392     (71 )
Non-GAAP   $ 143,439     $ 10,643     $ 24,395     $ 47,727     $ 3,304   $ 7,882   $ (479 )
                                                     


                                           
    Nine Months Ended September 30, 2019
                                 
        Selling,   General   Research   Non-operating   Income   Non-controlling
    Cost of   distribution   and   and   income   tax provision   interest
    revenue   and marketing   administrative   development   (expense), net   (benefit)   adjustment
GAAP   $ 140,432     $ 9,354     $ 39,774     $ 49,209     $ 58,837     $ 13,292     $ (4,215 )
Intangible amortization     (669 )           (108 )                       34  
Share-based compensation     (2,939 )     (285 )     (8,577 )     (1,199 )                 257  
Impairment of long-lived assets     (69 )           (23 )     (102 )                 55  
Gain on litigation settlement                             (59,900 )            
Income tax benefit on pre-tax adjustments                                   (10,422 )     (59 )
Non-GAAP   $ 136,755     $ 9,069     $ 31,066     $ 47,908     $ (1,063 )   $ 2,870     $ (3,928 )
                                                         

Source: Amphastar Pharmaceuticals, Inc.

 

Copyright ©2020 Amphastar Pharmaceuticals, Inc.

Privacy      Terms & Conditions

This site is intended for residents of the United States