– Company announces reduction in force to streamline costs and accelerate the path to profitability, particularly in light of the business impact from the COVID-19 pandemic –
– Company to host conference call today at 5:00 p.m. EDT –
DALLAS and FORT WORTH, Texas, May 11, 2020 (GLOBE NEWSWIRE) -- Neos Therapeutics, Inc. (Nasdaq: NEOS), a commercial-stage pharmaceutical company developing and manufacturing central nervous system-focused products, today reported financial results for the first quarter ended March 31, 2020 and announced that it is reducing its cost structure by decreasing its workforce by approximately 25 percent.
“Since late 2018, we have been steadfast in taking action to better position Neos for long-term profitability and growth. Today, we have made the difficult but necessary decision to reduce headcount across the organization to streamline costs and further strengthen our long-term outlook as we adjust to a rapidly changing economic environment and the recent impact on our business as a result of the COVID-19 pandemic. We believe this decision will ensure and accelerate our path to profitability, enable further investment in our pipeline candidate, NT0502, for the treatment of sialorrhea and strengthen our ability to acquire on-market product opportunities to leverage our commercial organization. We acknowledge this decision impacts many talented employees, and I would like to personally thank them for their contributions to Neos and their dedication to the patients we serve,” said Jerry McLaughlin, President and Chief Executive Officer.
The reduction in force announced today, affects approximately 50 employees, or 25 percent of the Company’s workforce. Following these changes, the Company will have approximately 45 (of the previous 75) sales territories, which represent approximately 80 percent of its current prescriber base for its Attention Deficit Hyperactivity Disorder (ADHD) business. The Company plans to deploy alternative sales and marketing efforts toward many of the remaining 20 percent of current prescribers.
ADHD Commercial Franchise
Development Pipeline
Financial Highlights and Select First Quarter 2020 Financial Results
Q1 2020 | Q1 2019 | |
Adzenys XR-ODT | $4.2MM | $6.7MM |
Cotempla XR-ODT | $8.1MM | $5.8MM |
Adzenys ER | $0.2MM | $0.1MM |
Generic Tussionex | $2.0MM | $2.0MM |
Total | $14.5MM | $14.6MM |
Conference Call Details
Neos management will host a conference call and live audio webcast to discuss these results and provide a company update at 5:00 p.m. EDT today. The live call may be accessed by dialing (877) 388-8985 for domestic calls, or +1 (562) 912-2654 for international callers, and referencing conference ID number 1099917. A live audio webcast for the conference call will be available on the Investor Relations page of the Company’s website at http://investors.neostx.com/. Following the conclusion of the call, the webcast will be available for replay for 30 days.
About Neos Therapeutics
Neos Therapeutics, Inc. (NASDAQ: NEOS) is a commercial-stage pharmaceutical company developing and manufacturing central nervous system (CNS)-focused products. The Company markets Adzenys XR-ODT® (amphetamine) extended-release orally disintegrating tablets (see Full Prescribing Information, including Boxed WARNING), Cotempla XR-ODT® (methylphenidate) extended-release orally disintegrating tablets (see Full Prescribing Information, including Boxed WARNING), and Adzenys-ER® (amphetamine) extended-release oral suspension (see Full Prescribing Information, including Boxed WARNING), all for the treatment of ADHD. The Company also has a development candidate, NT0502, for the treatment of sialorrhea in patients with neurological conditions. Additional information about Neos is available at www.neostx.com.
Forward-Looking Statements
Any statements in this press release about future expectations, plans and prospects for the Company, including statements about the Company’s strategy, future operations, commercial products, clinical development of its therapeutic candidates, plans for potential future product candidates, financial condition and outlook, and other statements containing the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “suggest,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: the impact of COVID-19 on prescriptions for the Company’s products and on the Company’s business, revenues, results of operations and financial condition, the net sales, profitability, and growth of the Company’s commercial products, the Company’s future expansion of the Neos RxConnect network; the status, timing, costs, results and interpretation of the Company’s clinical trials or any future trials, including whether the Company will initiate a Phase 1 ascending dose study of NT0502 in the second half of 2020; the uncertainties inherent in conducting clinical trials; expectations for regulatory interactions, submissions and approvals; the financial condition and outlook for the Company, including whether the Company will continue to make progress towards its goal of achieving operational profitability; availability of funding sufficient for the Company’s foreseeable and unforeseeable operating expenses and capital expenditure requirements; uncertainties related to the Company’s intellectual property, including the expected expiration of the methods of use patent for N-desethyloxybutynin; other matters that could affect the availability or commercial potential of the Company’s commercial products or therapeutic candidates; and other factors discussed in the Risk Factors set forth in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (SEC) and in other filings the Company makes with the SEC from time to time. In addition, the forward-looking statements included in this press release represent the Company’s views only as of the date hereof. The Company anticipates that subsequent events and developments may cause the Company’s views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so, except as may be required by law.
Neos Therapeutics, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(unaudited)
March 31, | December 31, | ||||||
2020 | 2019 | ||||||
ASSETS | |||||||
Current Assets: | |||||||
Cash and cash equivalents | $ | 27,858 | $ | 16,830 | |||
Short-term investments | 3,992 | 8,064 | |||||
Accounts receivable, net of allowances for chargebacks and cash discounts of $3,295 and $4,848 at March 31, 2020 and December 31, 2019, respectively | 20,782 | 26,563 | |||||
Inventories, net | 10,218 | 11,010 | |||||
Prepaid expenses and other current assets | 2,904 | 4,092 | |||||
Total current assets | 65,754 | 66,559 | |||||
Property and equipment, net | 7,014 | 7,345 | |||||
Operating lease right-of-use assets | 2,920 | 3,044 | |||||
Intangible assets, net | 12,139 | 12,543 | |||||
Other assets | 1,266 | 1,382 | |||||
Total assets | $ | 89,093 | $ | 90,873 | |||
LIABILITIES AND STOCKHOLDERS' DEFICIT | |||||||
Current Liabilities: | |||||||
Accounts payable | $ | 13,033 | $ | 6,650 | |||
Accrued expenses | 30,556 | 40,188 | |||||
Current portion of operating lease liabilities | 707 | 681 | |||||
Short-term line of credit | 8,569 | — | |||||
Current portion of long-term debt | 15,534 | 15,836 | |||||
Total current liabilities | 68,399 | 63,355 | |||||
Long-Term Liabilities: | |||||||
Long-term debt, net of current portion | 29,422 | 29,099 | |||||
Operating lease liabilities | 3,067 | 3,254 | |||||
Derivative liability | 1,231 | 1,135 | |||||
Other long-term liabilities | 154 | 160 | |||||
Total long-term liabilities | 33,874 | 33,648 | |||||
Stockholders' (Deficit) Equity: | |||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued or outstanding at March 31, 2020 and December 31, 2019 | — | — | |||||
Common stock, $0.001 par value, 100,000,000 shares authorized at March 31, 2020 and December 31, 2019; 49,777,756 and 49,743,955 shares issued and outstanding, respectively, at March 31, 2020; 49,766,472 and 49,732,671 shares issued and outstanding, respectively, at December 31, 2019 | 50 | 50 | |||||
Treasury stock, at cost, 33,801 shares at March 31, 2020 and December 31, 2019 | (352 | ) | (352 | ) | |||
Additional paid-in capital | 328,956 | 328,056 | |||||
Accumulated deficit | (341,835 | ) | (333,885 | ) | |||
Accumulated other comprehensive income | 1 | 1 | |||||
Total stockholders' deficit | (13,180 | ) | (6,130 | ) | |||
Total liabilities and stockholders' deficit | $ | 89,093 | $ | 90,873 |
Neos Therapeutics, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(unaudited)
Three Months Ended | |||||||
March 31, | |||||||
2020 | 2019 | ||||||
Revenues: | |||||||
Net product sales | $ | 14,493 | $ | 14,634 | |||
Cost of goods sold | 6,389 | 6,396 | |||||
Gross profit | 8,104 | 8,238 | |||||
Research and development expenses | 2,035 | 3,197 | |||||
Selling and marketing expenses | 7,592 | 7,069 | |||||
General and administrative expenses | 4,365 | 3,793 | |||||
Loss from operations | (5,888 | ) | (5,821 | ) | |||
Interest expense | (2,037 | ) | (2,115 | ) | |||
Other (expense) income, net | (25 | ) | 336 | ||||
Net loss | $ | (7,950 | ) | $ | (7,600 | ) | |
Weighted average common shares outstanding used to compute net loss per share, basic and diluted | 49,736,125 | 49,703,563 | |||||
Net loss per share of common stock, basic and diluted | $ | (0.16 | ) | $ | (0.15 | ) |
Contacts:
Richard Eisenstadt
Chief Financial Officer
Neos Therapeutics
(972) 408‑1389
reisenstadt@neostx.com
Sarah McCabe
Stern Investor Relations, Inc.
(212) 362‑1200
sarah.mccabe@sternir.com