BRISTOL, Tenn., - King Pharmaceuticals, Inc. (NYSE:KG) announced today that total revenues were $429 million during the first quarter ended March 31, 2009, compared to $432 million in the first quarter of 2008. The Company reported a net loss of $11 million and a diluted loss per share of $0.04 during the first quarter of 2009, compared to net earnings of $86 million and diluted earnings per share of $0.35 in the first quarter of the prior year. Excluding certain recurring non-GAAP adjustments and special items, adjusted net earnings equaled $64 million and adjusted diluted earnings per share equaled $0.26 during the first quarter ended March 31, 2009, compared to adjusted net earnings of $124 million and adjusted diluted earnings per share of $0.51 in the first quarter of 2008.
Similar to its financial reporting in prior years, King reports financial results determined in accordance with Generally Accepted Accounting Principles ("GAAP") and adjusted financial results. However, beginning with the first quarter of 2009, King's adjusted financial results will exclude the amortization of intangible assets and non-cash imputed interest expense associated with the Company's $400 million 11/4% Convertible Senior Notes, as well as special items. For more information, see the "About Adjusted Financial Results" paragraph below.
Brian A. Markison, Chairman, President and Chief Executive Officer of King, stated, "During the first quarter, we moved closer to an approval of the New Drug Application (NDA) for EMBEDA(TM), our long-acting morphine formulation that is designed to deter common forms of misuse and abuse. Specifically, the Company received feedback from the U.S. Food and Drug Administration (FDA) regarding a Risk Evaluation and Mitigation Strategy (REMS) for EMBEDA(TM), and we are in discussions with the agency. We remain confident that EMBEDA(TM) will be approved in the near future."
Mr. Markison continued, "During the first quarter, King assumed full control from Pain Therapeutics, Inc. of all activities related to the development of REMOXY(R), a long-acting oxycodone formulation. As a result of the transition, we have set a new date with the FDA to discuss our planned responses to the previously received Complete Response Letter. We now expect this meeting to occur in the first half of July. We are also eagerly anticipating the approaching June 30, 2009 PDUFA date for the FDA's review of the NDA for ACUROX(R) Tablets, a short-acting oxycodone product that we are developing with Acura Pharmaceuticals. We remain excited about our extensive pipeline and the potential of our novel opioid medicines in development that are designed to reduce the risk of misuse and abuse commonly associated with existing medicines."
Joseph Squicciarino, King's Chief Financial Officer, stated, "During the first quarter, we substantially completed our integration initiatives associated with our December 2008 acquisition of Alpharma Inc. Additionally, we repaid a total of $48 million of principal on the long-term debt we incurred in connection with the acquisition, $33 million in excess of that required by our repayment schedule. During the remainder of 2009, we expect strong cash flow from operations which will continue to allow us to aggressively pay down our long-term debt, advance our pipeline and explore business development opportunities consistent with our strategy for growth."
As of March 31, 2009, the Company's cash and cash equivalents totaled approximately $437 million. During the first quarter of 2009, the Company generated cash flow from operations of approximately $17 million.
Net revenue from branded pharmaceuticals totaled $278 million for the first quarter of 2009, compared to $369 million during the first quarter of 2008. The decrease in revenues was primarily due to the market entry of generic substitutes for ALTACE(R) (ramipril) in December 2007.
Net sales of SKELAXIN(R) (metaxalone) totaled $101 million during the first quarter of 2009, compared to $116 million during the same period of the prior year.
THROMBIN-JMI(R) (thrombin, topical, bovine, USP) net sales totaled $47 million during the first quarter of 2009, compared to $67 million during the first quarter of 2008.
Net sales of AVINZA(R) (morphine sulfate extended release) totaled $39 million during the first quarter of 2009, compared to $32 million during the first quarter of 2008.
Net sales of FLECTOR(R) PATCH (diclofenac epolamine topical patch) 1.3% totaled $17 million during the first quarter of 2009. The Company added FLECTOR(R) PATCH as a result of its acquisition of Alpharma on December 29, 2008. As previously reported, the wholesale inventory level of FLECTOR(R) PATCH exceeded King's normal level as of the end of the fourth quarter of 2008. In the first quarter of 2009, King reduced these inventories to a level consistent with its other promoted products. Accordingly, first quarter 2009 FLECTOR(R) PATCH net sales were lower than prescription demand. The Company anticipates that net sales of this product should more closely reflect prescription demand beginning in the second quarter of 2009.
LEVOXYL(R) (levothyroxine sodium tablets, USP) net sales totaled $20 million during the first quarter ended March 31, 2009, compared to $16 million during the first quarter of 2008.
ALTACE(R) net sales totaled $10 million during the first quarter of 2009, compared to $80 million during the first quarter of 2008.
Revenues from the Animal Health business were $80 million for the first quarter ended March 31, 2009. The Company added the Animal Health business as a result of its acquisition of Alpharma.
King's Meridian Auto-Injector business contributed revenue totaling $57 million during the first quarter of 2009, compared to $43 million during the first quarter of 2008.
Royalty revenues, derived primarily from ADENOSCAN(R) (adenosine), totaled $15 million during the first quarter of 2009.
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