(All figures are presented in
- Adjusted EBITDA in Q1 2024 was
$3.6 million , an increase of 12.5% over Q1 2023 - Epuris sales volumes grew 7.2% in the quarter over Q1 2023, continuing growth trajectory for the third consecutive quarter
- Licensing revenue increased 55.1% to
$2.6 million over Q1 2023 - Cash at
March 31, 2024 was$42.0 million (CDN$56.9 million ) or$1.74 per outstanding common share (CDN$2.36 )
First Quarter 2024 Financial Highlights
(All figures in
- Total revenue was
$5.9 million in Q1 2024, an increase of 20.0% - Licensing revenue increased 55.1% to
$2.6 million in Q1 2024, due to higher licensing product sales from Absorica and its authorized generic - Epuris product revenue increased by 7.2%, to
$2.9 million in Q1 2024 compared to$2.7 million in Q1 2023 - Total gross profit increased 23.1% to
$4.8 million in Q1 2024 - Adjusted EBITDA2 increased 12.5% to
$3.6 million in Q1 2024
Management Commentary
Over the past few months, we have found a number of opportunities which we are currently pursuing and are becoming more optimistic that we will be successful in acquiring one or a combination of these opportunities."
Q1 2024 Corporate Highlights
- In
January 2024 , common shares of the Company commenced trading on the OTCQX® Best Market ("OTCQX") under the ticker symbol CPHRF. The OTCQX is the highest market tier of OTC Markets and providesU.S. -based investors with easier access to purchase Cipher's common shares. - In
February 2024 , Cipher partner, Moberg Pharma AB ("Moberg") (OMX:MOB), officially launched its much anticipated MOB-015 product inSweden under the brand name Terclara®. - On
April 23, 2024 , Moberg announced demand for MOB-015 Terclara® has been strong inSweden , and initial sales are very encouraging as demand has far outpaced supply at the pharmacy level, resulting in pharmacies increasing orders to ensure the product is readily available. Cipher holds the Canadian rights for MOB-015, a product which will serve the prescription market for the Onychomycosis indication, representing a total market of approximatelyCDN$92.4 million 3, of which greater than 95% of the market is served by one main product. - On
May 6, 2024 , Moberg announced MOB-015 received national approval for all 13 countries included in the European decentralized procedure. Cipher believes this further de-risks the eventual approval of MOB-015 inCanada , whereby Cipher holds the exclusive distribution rights.
Q1 2024 Financial Review
(All figures in
- Total revenue was
$5.9 million in Q1 2024, compared to$4.9 million in Q1 2023, an increase of 20.0% - Licensing revenue increased 55.1% to
$2.6 million in Q1 2024 compared to$1.7 million in Q1 2023 - Product revenue marginally increased to
$3.3 million in Q1 2024 up from$3.2 million in Q1 2023 - Total gross profit was
$4.8 million in Q1 2024, compared to$3.9 million in Q1 2023, an increase of 23.1% - Net income and earnings per common share were
$4.9 million and$0.21 , respectively, in Q1 2024, compared to$2.6 million and$0.10 in Q1 2023, largely attributable to the recognition of previously unrecognized deferred tax losses in Q1 2024 - EBITDA2 was consistent year-over-year at
$2.7 million for the quarter - Adjusted EBITDA2 in Q1 2024 was
$3.6 million , compared to$3.2 million in Q1 2023, an increase of 12.5%
Business Strategy & Outlook
Cipher expects to continue to execute on its business strategy in 2024 and remains focused on profitability and driving shareholder value. Key focuses include:
- Near-term strategic focus on product and business acquisitions that will generate cash flow, high growth and near-term profitability.
- Developing our MOB-015 commercial launch plan and proactively readying our
Health Canada regulatory submission, for the novel product and treatment of nail fungus, and whereby Cipher has the exclusive Canadian market rights. - Continue to collaborate with our partner Moberg Pharma on its MOB-015 phase III clinical trial in the
U.S. , whereby results are expected byJanuary 2025 . - Continue to collaborate with the Company's partner, Can-Fite Biopharma on its phase III COMFORT study of Piclidenoson used in the treatment of moderate to severe psoriasis which met its previous clinical trial primary endpoint of superiority and achieved a better tolerability profile in a comparative analysis, and whereby Cipher has the exclusive Canadian market rights.
Financial Statements and MD&A
Cipher's Financial Statements for the three months ended March 31, 2024, and Management's Discussion and Analysis (the "MD&A") for the three months ended March 31, 2024, are available on the Company's website at www.cipherpharma.com in the "Investors" section under "Financial Reports" and on SEDAR+ at www.sedarplus.ca.
Notice of Conference Call
Cipher will hold a conference call on May 10, 2024 at 8:30 a.m. (ET) to discuss its financial results and other corporate developments.
- To access the conference call by telephone, dial (416) 764-8650 or (888) 664-6383
- A live audio webcast will be available at https://app.webinar.net/ZQPqmBaVGEn
- An archived replay of the webcast will be available until
May 17, 2024 and can be accessed by dialing (416) 764-8677 or (888) 390-0541 and entering conference replay code 196164#
About
Forward-Looking Statements and Non-IFRS Measures
This document includes forward-looking statements within the meaning of applicable securities laws. These forward-looking statements include, among others, statements with respect to the timing of the receipt of the topline results from MOB-015 Phase 3 North American study, the expectation of approval of MOB-015 in the
By their nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, which give rise to the possibility that predictions, forecasts, projections and other forward-looking statements will not be achieved. Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. We caution readers not to place undue reliance on these statements as a number of important factors, many of which are beyond our control, could cause our actual results to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to, publication of negative results of clinical trials; our ability to enter into development, manufacturing and marketing and distribution agreements with other pharmaceutical companies and keep such agreements in effect; our dependency on a limited number of products; our dependency on protection from patents that will expire; integration difficulties and other risks if we acquire or in-license technologies or product candidates; reliance on third parties for the marketing of certain products; the product approval process by regulators which can be highly unpredictable; the timing of completion of clinical trials, regulatory submissions and regulatory approvals; reliance on third parties to manufacture our products and events outside of our control that could adversely impact the ability of our manufacturing partners to supply products to meet our demands; we may be subject to future product liability claims; unexpected product safety or efficacy concerns may arise; we generate license revenue from a limited number of distribution and supply agreements; the pharmaceutical industry is highly competitive with new competing product entrants; requirements for additional capital to fund future operations; products may be subject to pricing regulation; dependence on key managerial personnel and external collaborators; certain of our products are subject to regulation as controlled substances; limitations on reimbursement in the healthcare industry; extent and impact of health pandemic outbreaks on our business; unpredictable development goals and projected time frames; rising insurance costs; ability to enforce covenants not to compete; we may be unsuccessful in evaluating material risks involved in completed and future acquisitions; we may be unable to identify, acquire or integrate acquisition targets successfully; compliance with privacy and security regulation; our policies regarding product returns, allowances and chargebacks may reduce revenues; additional regulatory burden and controls over financial reporting; general commercial litigation, class actions, other litigation claims and regulatory actions; the difficulty for shareholders to realize in the United States upon judgments of
We caution that the foregoing list of important factors that may affect future results is not exhaustive. When reviewing our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Additional information about factors that may cause actual results to differ materially from expectations, and about material factors or assumptions applied in making forward-looking statements, may be found in the "Risk Factors" section of our MD&A for the year ended December 31, 2023 and the Company's Annual Information Form, and elsewhere in our filings with Canadian securities regulators. Except as required by Canadian securities law, we do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf; such statements speak only as of the date made. The forward-looking statements included herein are expressly qualified in their entirety by this cautionary language.
1) At the March 31, 2024 exchange rate – 1.3550
2) EBITDA and adjusted EBITDA are non-IFRS financial measures. These non-IFRS measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS and are unlikely to be comparable to similar measures presented by other companies. Management uses non-IFRS measures such as Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") and Adjusted EBITDA to provide investors with supplemental measures of the Company's operating performance and thus highlight trends in the Company's core business that may not otherwise be apparent when relying solely on IFRS financial measures. The Company defines Adjusted EBITDA as earnings before interest expense, income taxes, depreciation of property and equipment, amortization of intangible assets, non-cash share-based compensation, changes in fair value of derivative financial instruments, provision for legal settlement, loss on disposal of assets and loss on extinguishment of lease, impairment of intangible assets, restructuring costs and unrealized foreign exchange gains and losses.
3)
The following is a summary of how EBITDA and Adjusted EBITDA are calculated:
(IN THOUSANDS OF | Three months | Three months |
except for per share amounts) | $ | $ |
Net income and comprehensive income | 4,923 | 2,626 |
Add back: | ||
Depreciation and amortization | 289 | 343 |
Interest income | (555) | (355) |
Income taxes | (1,955) | 82 |
EBITDA | 2,702 | 2,696 |
Unrealized foreign exchange loss (gain) | 642 | (7) |
Restructuring costs | — | 38 |
Share-based compensation | 224 | 444 |
Adjusted EBITDA | 3,568 | 3,171 |
Adjusted EBITDA per share – basic | 0.15 | 0.12 |
Adjusted EBITDA per share – dilutive | 0.15 | 0.12 |
Consolidated statements of income and comprehensive income
Three months ended | ||
(IN THOUSANDS OF | 2024 | 2023 |
except for per share amounts) | $ | $ |
Revenue | ||
Licensing revenue | 2,600 | 1,676 |
Product revenue | 3,267 | 3,210 |
Net revenue | 5,867 | 4,886 |
Operating expenses | ||
Cost of products sold | 1,055 | 977 |
Research and development | — | 3 |
Depreciation and amortization | 289 | 343 |
Selling, general and administrative | 1,468 | 1,217 |
Total operating expenses | 2,812 | 2,540 |
Other (income) expenses | ||
Interest income | (555) | (355) |
Unrealized foreign exchange loss (gain) | 642 | (7) |
Total other (income) expenses | 87 | (362) |
Income before income taxes | 2,968 | 2,708 |
Current income tax expense | — | 97 |
Deferred income tax recovery | (1,955) | (15) |
Total income tax (recovery) expense | (1,955) | 82 |
Net income and comprehensive income for the year | 4,923 | 2,626 |
Income per share | ||
Basic | 0.21 | 0.10 |
Diluted | 0.20 | 0.10 |
Consolidated statements of financial position
As at | As at | |
2024 | 2023 | |
(IN THOUSANDS OF | $ | $ |
Assets | ||
Current assets | ||
Cash and cash equivalents | 41,981 | 39,825 |
Accounts receivable | 8,433 | 5,088 |
Inventory | 2,768 | 2,982 |
Prepaid expenses and other assets | 419 | 378 |
Total current assets | 53,601 | 48,273 |
Property and equipment, net | 377 | 402 |
Intangible assets, net | 1,503 | 1,763 |
15,706 | 15,706 | |
Deferred tax assets | 21,365 | 19,887 |
Total assets | 92,552 | 86,031 |
Liabilities and shareholders' equity | ||
Current liabilities | ||
Accounts payable and accrued liabilities | 6,141 | 4,639 |
Contract liability | 494 | 519 |
Current portion of lease obligation | 95 | 94 |
Total current liabilities | 6,730 | 5,252 |
Lease obligation | 228 | 259 |
Total liabilities | 6,958 | 5,511 |
Shareholders' equity | ||
Share capital | 18,391 | 18,012 |
Contributed surplus | 5,687 | 5,755 |
Accumulated other comprehensive loss | (9,514) | (9,514) |
Retained earnings | 71,030 | 66,267 |
Total shareholders' equity | 85,594 | 80,520 |
Total liabilities and shareholders' equity | 92,552 | 86,031 |
SOURCE
© Canada Newswire, source