Medicure Reports Financial Results for Quarter and Year Ended December 31, 2018

Monday, April 29, 2019

WINNIPEG, April 29, 2019 /CNW/ - Medicure Inc. ("Medicure" or the "Company") (TSXV:MPH, OTC:MCUJF), a pharmaceutical company, today reported its results from operations for the quarter and year ended December 31, 2018.

Year Ended December 31, 2018 Highlights:

  • Recorded total net revenue from the sale of products of $29.1 million during the year ended December 31, 2018 compared to $27.1 million for the year ended December 31, 2017;

  • Recorded total net revenue from the sale of AGGRASTAT® of $28.5 million during the year ended December 31, 2018 compared to $27.1 million for the year ended December 31, 2017;

  • Net income for the year ended December 31, 2018 was $3.9 million, compared to net income of $43.4 million for the year ended December 31, 2017, which includes the gain on the sale of the Apicore business which occurred in October 2017;

  • Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA)1 for the year ended December 31, 2018 was $0.2 million compared to adjusted EBITDA of $4.8 million for the year ended December 31, 2017 and

  • Diversified product portfolio with US FDA ANDA approval of Sodium Nitroprusside and acquisition of US marketing rights to ZYPITAMAG™.

Financial Results

Net revenues for the year ended December 31, 2018 were $29.1 million compared to $27.1 million for the year ended December 31, 2017.  Net revenues from AGGRASTAT® for the year ended December 31, 2018 were $28.5 million compared to $27.1 million for the year ended December 31, 2017.  Additionally, ZYPITAMAG™, which was launched commercially by the Company in 2018, contributed $0.7 million of net revenues for the year ended December 31, 2018.

Net revenues from AGGRASTAT® for the three months ended December 31, 2018 were $8.2 million compared to $5.0 million for the three months ended December 31, 2017.

The Company continues to experience an increase in patient market share held by AGGRASTAT® and an increase in the number of new hospital customers using the product leading to the highest hospital demand for AGGRASTAT® in the Company's history, which is partially offset by increased price competition as a result of increased generic competitors, which resulted in lower discounted prices for AGGRASTAT® throughout 2018. An increased volume of AGGRASTAT® sold and a weaker Canadian dollar compared to its US counterpart resulted in the revenue increases experienced in 2018.

Medicure continues to focus on expanding the customer base for AGGRASTAT® and growing the sales of ZYPITAMAG™ (pitavastatin). Diversification of revenues remains an important aspect of the Company's focus with the Company signing a marketing agreement for ReDS™ in January 2019 and the expected launch of Sodium Nitroprusside in mid-2019.

Adjusted EBITDA for the year ended December 31, 2018 was $0.2 million compared to $4.8 million for the year ended December 31, 2017. The decrease in adjusted EBITDA for the year is the result of the higher selling, general and administration expenses caused by the incurrence of additional costs relating to the commercial organization due to the launch of ZYPITAMAG™ and higher research and development expenses related to the Company's product development pipeline. Adjusted EBITDA for the three months ended December 31, 2018 was negative $2.0 million compared to negative $0.6 million for the three months ended December 31, 2017.

Net income for the year ended December 31, 2018 was $3.9 million or $0.25 per share. This compares to net income of $43.4 million or $2.78 per share for the year ended December 31, 2017, which includes income of $11.5 million or $0.74 per share from continuing operations and income from discontinued operations of $31.9 million or $2.04 per share.  Discontinued operations includes the operations of Apicore and the gain on the sale of the Apicore business.

Net income for the three months ended December 31, 2018 was $1.5 million or $0.10 per share, compared to net income of $51.4 million or $2.81 per share for the three months ended December 31, 2017, primarily relating to the gain on the sale of the Apicore business.

At December 31, 2018, the Company had unrestricted cash and short-term investments totaling $71.9 million compared to $5.3 million as of December 31, 2017. The increase in cash is due to the proceeds received from the sale of the Apicore business in October 2017, which were received in 2018.  Cash flows from operating activities for the year ended December 31, 2018 totaled $0.7 million.

All amounts referenced herein are in Canadian dollars unless otherwise noted.

Notes

(1) The Company defines EBITDA as "earnings before interest, taxes, depreciation, amortization and other income or expense" and Adjusted EBITDA as "EBITDA adjusted for non-cash and non-recurring items".  The terms "EBITDA" and "Adjusted EBITDA", as it relates to the quarters and years ended December 31, 2018 and 2017 results prepared using International Financial Reporting Standards ("IFRS"), do not have any standardized meaning according to IFRS. It is therefore unlikely to be comparable to similar measures presented by other companies.

Conference Call Info:

Topic: Medicure's Fiscal Year End 2018 Results

Call date: Tuesday, April 30, 2019

Time: 7:30 AM Central Time (8:30 AM Eastern Time)

Canada toll-free: 1 (888) 465-5079  Canada toll: 1 (416) 216-4169

United States toll-free: 1 (888) 545-0687

Passcode: 8925377#

Webcast: This conference call will be webcast live over the internet and can be accessed from the Medicure investor relations page at the following link: http://www.medicure.com/investors

You may request international country-specific access information by e-mailing the Company in advance. Management will accept and answer questions related to the financial results and operations during the question-and-answer period at the end of the conference call. A recording of the call will be available following the event at the Company's website.

About Medicure

Medicure is a pharmaceutical company focused on the development and commercialization of therapies for the U.S. cardiovascular market. The present focus of the Company is the marketing and distribution of AGGRASTAT® (tirofiban hydrochloride) injection, ZYPITAMAG™ (pitavastatin) tablets and the ReDS™ device in the United States, where they are sold through the Company's U.S. subsidiary, Medicure Pharma Inc. For more information on Medicure please visit www.medicure.com.

To be added to Medicure's e-mail list, please visit: 
http://medicure.mediaroom.com/alerts

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward Looking Information: Statements contained in this press release that are not statements of historical fact, including, without limitation, statements containing the words "believes", "may", "plans", "will", "estimates", "continues", "anticipates", "intends", "expects" and similar expressions, may constitute "forward-looking information" within the meaning of applicable Canadian and U.S. federal securities laws (such forward-looking information and forward-looking statements are hereinafter collectively referred to as "forward-looking statements"). Forward-looking statements, include, estimates, analysis and opinions of management of the Company made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors which the Company believes to be relevant and reasonable in the circumstances. Inherent in forward-looking statements are known and unknown risks, uncertainties and other factors beyond the Company's ability to predict or control that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements, and as such, readers are cautioned not to place undue reliance on forward-looking statements. Such risk factors include, among others, the Company's future product revenues, stage of development, additional capital requirements, risks associated with the completion and timing of clinical trials and obtaining regulatory approval to market the Company's products, the ability to protect its intellectual property, dependence upon collaborative partners, changes in government regulation or regulatory approval processes, and rapid technological change in the industry. Such statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions about: general business and economic conditions; the impact of changes in Canadian-US dollar and other foreign exchange rates on the Company's revenues, costs and results; the timing of the receipt of regulatory and governmental approvals for the Company's research and development projects; the availability of financing for the Company's commercial operations and/or research and development projects, or the availability of financing on reasonable terms; results of current and future clinical trials; the uncertainties associated with the acceptance and demand for new products and market competition. The foregoing list of important factors and assumptions is not exhaustive. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, other than as may be required by applicable legislation. Additional discussion regarding the risks and uncertainties relating to the Company and its business can be found in the Company's other filings with the applicable Canadian securities regulatory authorities or the US Securities and Exchange Commission, and in the "Risk Factors" section of its Form 20F for the year ended December 31, 2018.

AGGRASTAT® (tirofiban hydrochloride) is a registered trademark of Medicure International Inc.

Consolidated Statements of Financial Position
(expressed in Canadian dollars)

As at December 31

2018

2017






Assets





Current assets:





Cash and cash equivalents

$

24,139,281

$

5,260,480

Short-term investments


47,747,000


-

Accounts receivable


10,764,579


8,588,255

Consideration receivable


-


82,678,366

Inventories


4,239,267


3,075,006

Prepaid expenses


2,696,693


903,914

Assets held for sale


-


14,052,861

Total current assets


89,586,820


114,558,882

Non‑current assets:





Property, plant and equipment


316,013


221,622

Intangible assets


1,705,250


1,756,300

Holdback receivable


11,909,368


12,068,773

Other assets


116,786


-

Deferred tax assets


127,176


326,108

Total non‑current assets


14,174,593


14,372,803

Total assets

$

103,761,413

$

128,931,685






Liabilities and Equity





Current liabilities:





Accounts payable and accrued liabilities

$

14,378,215

$

10,371,103

Accrued transaction costs


-


22,360,730

Current income taxes payable


1,058,487


2,428,560

Current portion of royalty obligation


1,495,548


1,537,202

Liabilities held for sale


-


6,976,313

Total current liabilities


16,932,250


43,673,908

Non‑current liabilities





Royalty obligation


2,035,010


2,911,810

License fee payable


-


501,800

Other long‑term liabilities


1,200,608


1,135,007

Total non‑current liabilities


3,235,618


4,548,617

Total liabilities


20,167,868


48,222,525

Equity:





Share capital


122,887,105


125,733,727

Warrants


1,948,805


1,948,805

Contributed surplus


7,628,188


6,897,266

Accumulated other comprehensive income


1,267,717


673,264

Deficit


(50,138,270)


(54,543,902)

Total Equity


83,593,545


80,709,160

Total liabilities and equity

$

103,761,413

$

128,931,685

 

Consolidated Statements of Net Income and Comprehensive Income
(expressed in Canadian dollars)


For the year ended December 31

2018

2017

2016

Revenue, net







Product sales, net

$

29,109,365

$

27,132,832

$

29,304,800

Cost of goods sold


4,152,238


3,464,686


3,721,191

Gross profit


24,957,127


23,668,146


25,583,609








Expenses







Selling, general and administrative


19,502,337


14,867,635


15,417,604

Research and development


6,681,013


5,148,233


3,630,079



26,183,350


20,015,868


19,047,683

(Loss) income before the undernoted


(1,226,223)


3,652,278


6,535,926








Other expense (income):







Revaluation of holdback receivable


1,472,999


(82,489)


-

Impairment loss


-


635,721


-



1,472,999


553,232


-








Finance (income) costs:







Finance (income) expense, net


(1,060,932)


837,461


2,478,914

Foreign exchange (gain) loss, net


(6,460,805)


(175,459)


262,469



(7,521,737)


662,002


2,741,383

Net income before income taxes

$

4,822,515

$

2,437,044

$

3,794,543

Income tax (expense) recovery







Current


(677,900)


9,392,836


(501,315)

Deferred


(218,976)


(333,187)


331,095



(896,876)


9,059,649


(170,220)








Net income before discontinued operations

$

3,925,639

$

11,496,693

$

3,624,323

Net income from discontinued operations, net of tax


-


31,924,191


23,358,318

Net income

$

3,925,639

$

43,420,884

$

26,982,641

Translation adjustment, attributable to:







Continuing operations


594,453


(30,295)


(400,829)

Discontinued operations


-


21,567


(21,567)

Comprehensive income

$

4,520,092

$

43,412,156

$

26,560,245








Earnings per share from continuing operations







Basic

$

0.25

$

0.74

$

0.24

Diluted

$

0.24

$

0.63

$

0.21








Earnings per share from discontinued operations







Basic

$

-

$

2.04

$

1.56

Diluted

$

-

$

1.76

$

1.35








Earnings per share







Basic

$

0.25

$

2.78

$

1.80

Diluted

$

0.24

$

2.39

$

1.56

 

Consolidated Statements of Cash Flows
(expressed in Canadian dollars)

For the year ended December 31

2018

2017

2016

Cash (used in) provided by:







Operating activities:







Net income from continuing operations for the year

$

3,925,639

$

11,496,693

$

3,624,323

Net income from discontinued operations for the year


-


31,924,191


23,358,318



3,925,639


43,420,884


26,982,641

Adjustments for:







Gain on sale of Apicore


-


(55,254,236)


-

Current income tax expense (recovery)


677,900


(9,392,836)


504,586

Deferred income tax expense (recovery)


218,976


(1,513,868)


301,512

Impairment loss


-


635,721


-

Revaluation of holdback receivable


1,472,999


(82,489)


-

Revaluation of long-term derivative


-


-


(20,560,440)

Gain on step acquisition


-


-


(4,895,573)

Amortization of property, plant and equipment


103,207


1,173,019


189,008

Amortization of intangible assets


195,977


6,633,957


2,192,024

Share‑based compensation


1,022,175


623,115


1,400,241

Write-down (write-up) of inventories


94,517


385,289


(108,817)

Finance (income) expense, net


(1,060,932)


837,461


3,416,678

Unrealized foreign exchange (gain) loss


(5,322,916)


270,663


215,386

Change in the following:







Accounts receivable


(1,340,746)


(3,713,375)


(4,174,691)

Inventories


(1,258,778)


145,339


2,520,499

Prepaid expenses


(1,792,779)


76,724


1,706,109

Other assets


-


33,130


(1,229)

Accounts payable and accrued liabilities


7,131,998


48,398,200


143,257

Deferred revenue


-


(621,455)


(382,727)

Other long-term liabilities


-


77,467


(102,828)

Interest received (paid), net


255,119


(7,485,956)


(1,223,664)

Income taxes paid


(2,041,317)


(894,327)


-

Royalties paid


(1,538,766)


(1,829,295)


(1,712,390)

Cash flows from operating activities


742,273


21,923,132


6,409,582

Investing activities:







Proceeds from Apicore Sale Transaction


65,234,555


89,719,599


-

Purchase of short-term investments


(44,100,000)


-


-

Acquisition of Class C common shares of Apicore


-


(31,606,865)


-

Acquisition of Class E common shares of Apicore


-


(2,640,725)


-

Acquisition of Apicore, net of cash acquired


-


-


(41,711,546)

Acquisition of property, plant and equipment


(197,494)


(1,194,703)


(464,208)

Acquisition of intangible assets


(1,280,540)


(127,144)


-

Cash flows from (used in) investing activities


19,656,521


54,150,162


(42,175,754)

 

Consolidated Statements of Cash Flows (Continued)
(expressed in Canadian dollars)

For the year ended December 31

2018

2017

2016

Financing activities:




Repurchase of common shares under normal course issuer bid

(3,021,340)

-

-

Proceeds from exercise of stock options

363,458

519,999

1,844,130

Proceeds from exercise of Apicore stock options

-

421,942

-

Proceeds from exercise of warrants

-

92,332

39,172

Issuance of long-term debt

-

-

56,781,184

Repayment of long-term debt

-

(75,180,908)

(1,666,666)

Repayment of note payable to Apicore

-

(18,507,400)

-

Increase in short-term borrowings

-

161,923

332,555

Decrease (increase) in cash held in escrow

-

12,809,072

(12,809,072)

Finance lease payments

-

(101,946)

(10,463)

Payment of due to vendor

-

(3,185,945)

-

Cash flows (used in) from financing activities

(2,657,882)

(82,970,931)

44,510,840

Foreign exchange (loss) gain on cash held in foreign currency

1,137,889

(108,060)

(47,083)

Increase (decrease) in cash

18,878,801

(7,005,697)

8,697,585

Cash and cash equivalents, beginning of period

5,260,480

12,266,177

3,568,592

Cash and cash equivalents, end of period

$ 24,139,281

$ 5,260,480

$ 12,266,177

 

SOURCE Medicure Inc.

For further information: James Kinley, Chief Financial Officer, Tel. 888-435-2220, Fax 204-488-9823, E-mail: info@medicure.com, www.medicure.com

 


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