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NOVEN ACHIEVES RECORD RESULTS FOR SECOND QUARTER |
BackNoven Quarterly EPS Doubles to Record $0.28
Novogyne
Quarterly Earnings and Profit Contribution Increase Over 100%
Miami, FL, August
1, 2002 -- Noven Pharmaceuticals, Inc. (NASDAQ: NOVN) today announced
financial results for the three and six month periods ended June 30, 2002,
and provided an update on its business and prospects. "For the 2002
second quarter and first half, both Noven and Novogyne Pharmaceuticals
reported record financial results," said Robert C. Strauss, Noven's
President, CEO & Chairman.
Financial
Results
2002 Second Quarter
Noven's net income more than doubled to $6.6 million ($0.28 diluted earnings
per share) for the quarter ended June 30, 2002 (the "current quarter"),
compared to $3.2 million ($0.14 diluted earnings per share) for the same
period in 2001 (the "2001 quarter"). Revenues increased 28%
to $16.2 million from $12.6 million in the 2001 quarter, primarily due
to Estradot® sales abroad and higher sales of Vivelle®
family products in the U.S. Noven recognized $7.1 million in earnings
from Novogyne Pharmaceuticals, Noven's joint venture with Novartis Pharmaceuticals
Corporation, a 127% increase over the $3.1 million recognized in the 2001
quarter.
Novogyne's quarterly
net revenues increased 58% to $33.0 million, primarily due to increased
Vivelle® family sales, and its quarterly net income increased
117% to $15.5 million.
2002 First Half
Noven's net income increased 37% to $8.1 million ($0.34 diluted earnings
per share) for the six-month period ended June 30, 2002 (the "current
period"), compared to $5.9 million ($0.25 diluted earnings per share)
for the same period last year (the "2001 period"). Current period
revenues increased 14% to $28.9 million, compared to $25.3 million for
the 2001 period. Noven recognized $8.6 million in earnings from Novogyne,
a 132% increase over the $3.7 million recognized in the first half of
last year.
Novogyne's net revenues
for the first half increased 74% to $60.4 million, primarily due to increased
Vivelle® family sales and the addition of CombiPatch®
in March 2001, and its first half net income increased 72% to $25.1 million.
At June 30, 2002,
Noven's cash and cash equivalents increased to $53.4 million from $49.4
million at December 31, 2001.
Business
Update
Hormone Replacement Therapy (HRT)
"We began the second half of the year with considerable momentum
in our HRT business," said Strauss. "However, the recent publication
of studies examining HRT health risks has caused significant uncertainty
about our principal market. These studies are proving to be catalysts
for physicians and patients to reconsider whether, when, and in what form
HRT is appropriate for an individual woman. As this analysis is taking
place, we are positioned with the industry's leading transdermal HRT product
line, a proven and well trained domestic HRT sales force, and a strong
global partner with leadership in transdermal HRT."
"Our HRT patches
are very different from the most commonly prescribed and studied oral
products, and the Novogyne sales force has been delivering that key message
to physicians since well before the recent studies were published. Specifically:
– Noven's patches use plant-derived estradiol (which is identical
to a woman's own estrogen), not conjugated estrogens derived from pregnant
mare's urine;
– Noven's patches deliver hormones through the skin and directly
into the bloodstream, thereby avoiding first pass metabolism. This delivery
method provides continuous release of hormones into the system, and requires
that much less drug be put into the body to achieve the desired therapeutic
blood levels;
– Noven's combination HRT patch uses a different progestin than the
one used in the studied oral combination product."
"While HRT patches
differ from oral HRT products in these and other ways, there have been
no head-to-head safety studies comparing these products. This may make
therapy selection less clear cut for doctors and patients."
Strauss continued:
"We believe our products will receive full consideration by doctors
and patients as they evaluate the new studies and all available therapies.
We can position our products at the center of the debate, but we cannot
predict the final outcome at this early stage. Going forward, there is
risk as well as opportunity for HRT. As soon as we have sufficient prescription
and other data upon which to base a financial forecast, we intend to offer
public guidance on our revenue and earnings expectations for the coming
quarters."
New Product Pipeline
Strauss continued: "Noven's HRT pipeline products should keep us
ahead of evolving trends in HRT therapy. We expect that lower doses of
HRT may become more desirable. Later this month, Novogyne is scheduled
to launch the new low dose 0.025 mg/day. Vivelle-Dot® patch
in the U.S., and with our partner, we are developing lower dose versions
of our combination HRT patch. Together, these two efforts are expected
to help round out our low dose HRT range."
"Looking out
to 2003 and beyond, we expect to expand our business well beyond HRT and
into other large therapeutic categories like central nervous system disorders.
In the 2002 second quarter, we filed our New Drug Application for once-daily
MethyPatch®, our transdermal methylphenidate patch for
Attention Deficit Hyperactivity Disorder. The FDA is now reviewing our
application, and we are completing our market research with physicians
and parents across the country. Our preliminary market research has been
very positive. Also, we continue to advance patch versions of two undisclosed
non-HRT molecules towards early clinical trials, as well as several other
potential new patch products in various stages of development. And while
we expect to remain a leader in transdermal HRT, these ongoing efforts
should help Noven diversify its business and growth prospects into other
therapeutic areas."
Conference
Call
A public telephone conference with management to discuss Noven's financial
results will be broadcast live via the Internet at www.noven.com beginning
at 5:00 p.m. Eastern time this afternoon, August 1. Thereafter, a rebroadcast
of the call will be accessible at the same website. A taped replay of
the conference call will be available by telephone from August 1 at 8:00
p.m. Eastern time until the evening of August 3 by calling 877-660-6853
(from within the U.S.) or 201-612-7415 (from outside the U.S.) and entering
the access code 1628 and I.D. #38657. The conference call will contain
forward-looking information in addition to that contained in this press
release.
About
Noven
Noven Pharmaceuticals, Inc., headquartered in Miami, Florida, is a leading
developer of advanced transdermal drug delivery technologies and prescription
transdermal products. Together with Novartis Pharmaceuticals Corporation,
Noven owns a highly profitable women's health products company called
Novogyne Pharmaceuticals. Noven's existing products include advanced estrogen
transdermal delivery systems (including Vivelle-Dot®, licensed
to Novogyne, and Estradot®, licensed to Novartis Pharma
AG) and combination estrogen/progestin transdermal delivery systems (including
CombiPatch®, licensed to Novogyne, and Estalis®,
licensed to Novartis Pharma AG). With a range of additional products in
development, including MethyPatch®, Noven is committed
to becoming the world's premier developer, manufacturer and marketer of
transdermal drug delivery systems. For additional information on Noven,
visit the company's web site at www.noven.com.
This
release contains forward-looking statements related to the business of
Noven that can be identified by the use of forward-looking terminology
such as "may make", "believe", "predict",
"intend", "should keep", "expect", "scheduled",
"should help" and similar words and phrases. Such statements
are qualified by and subject to the risks and uncertainties specified
in Noven's most recent filings with the Securities and Exchange Commission
and those specified herein, including the risk that: the market for Noven's
HRT products could decline significantly as a result of the HRT studies,
either as physicians withdraw patients from HRT or as women elect to discontinue
HRT on their own; health care regulators could, as a result of the HRT
studies, modify the permitted use of Noven's products by mandatory product
label changes, remove the products from the market, delay approval of
new HRT products, or require that any new HRT products be subject to more
extensive testing prior to being approved; Novartis could, as a result
of the studies or otherwise, change its strategies or launch schedules
relating to the commercialization of Noven's products; Noven could be
named as a defendant in product liability lawsuits relating to its HRT
products; physicians and patients may not consider or select HRT patches
as desirable alternatives to oral HRT because of the lack of head-to-head
safety data or otherwise; evolving HRT prescribing trends may make Noven's
product line less attractive than other therapies; Noven's new low dose
patches may not be successfully commercialized and, in the case of the
lower dose combination patches, may not complete development or be approved
by regulatory authorities; and Noven may be unable to diversify its sources
of revenues beyond HRT due to the inability to develop or commercialize
non-HRT products. Currently, Noven's liquidity, results of operations
and business prospects are almost entirely dependent on sales of transdermal
HRT products. Accordingly, any adverse change in the market for HRT products
(including any adverse changes resulting from the HRT studies) could have
a material adverse impact on Noven's liquidity, results of operations
and business prospects.
Noven Pharmaceuticals, Inc.
Statements of Operations Data:
(amounts in thousands,
except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ---------------------
2002 2001 2002 2001
---------------------- ---------------------
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
Revenues:
Product sales $ 15,277 $ 11,842 $ 27,268 $ 23,864
License revenue 879 752 1,623 1,419
----------- ---------- ---------- ----------
Total revenues 16,156 12,594 28,891 25,283
Expenses:
Cost of products sold 6,021 5,894 11,921 10,710
Research and
development 3,313 2,410 6,682 4,637
Marketing, general
and administrative 3,679 3,176 6,612 5,836
----------- ---------- ---------- ----------
Total expenses 13,013 11,480 25,215 21,183
----------- ---------- ---------- ----------
Income from operations 3,143 1,114 3,676 4,100
Equity in earnings of
Novogyne 7,132 3,137 8,647 3,732
Interest income, net 195 482 402 1,101
----------- ---------- ---------- ----------
Income before income taxes 10,470 4,733 12,725 8,933
Provision for income taxes 3,827 1,510 4,629 3,043
----------- ---------- ---------- ----------
Net income $ 6,643 $ 3,223 $ 8,096 $ 5,890
=========== ========== ========== ==========
Basic earnings per share $ 0.29 $ 0.14 $ 0.36 $ 0.26
=========== ========== ========== ==========
Diluted earnings per share $ 0.28 $ 0.14 $ 0.34 $ 0.25
=========== ========== ========== ==========
Weighted average number of
common
shares outstanding:
Basic 22,528 22,335 22,510 22,286
=========== ========== ========== ==========
Diluted 23,687 23,561 23,571 23,585
=========== ========== ========== ==========
As Of
-----------------------
June 30, December 31,
Balance Sheet Data: 2002 2001
---------- ------------
(Unaudited) (Unaudited)
Cash and cash
equivalents $ 53,401 $ 49,389
Investment in
Novogyne $ 28,963 $ 32,043
Total assets $ 135,903 $ 136,228
Deferred license
revenue $ 31,135 $ 32,758
Stockholders' equity $ 90,752 $ 81,898
Investor &
Media Contact:
Joseph C. Jones
Vice President – Corporate Affairs
Noven Pharmaceuticals, Inc.
(305) 253-1916
Copyright © 2002 Noven Pharmaceuticals, Inc. All rights reserved.