Anika Therapeutics
Oct 25, 2017

Anika Reports Third Quarter 2017 Financial Results

Completed Enrollment in CINGAL Phase III Clinical Trial;
Advancement of Regenerative Medicine Pipeline;
MONOVISC Revenue Increased 50% Year-over-Year

BEDFORD, Mass.--(BUSINESS WIRE)-- Anika Therapeutics, Inc. (NASDAQ: ANIK), a global, integrated orthopedic medicines company specializing in therapeutics based on its proprietary hyaluronic acid ("HA") technology, today reported financial results for the third quarter ended September 30, 2017, along with business progress in the period.

"Anika made significant progress on multiple fronts executing its long-term growth strategy, highlighted by the early completion of enrollment in the CINGAL® Phase III trial, regulatory clearances for the expansion of MONOVISC® into India, Australia, and Taiwan, pipeline advancements and the bolstering of our executive and commercial leadership team," said Charles H. Sherwood, Ph.D., Chief Executive Officer. "MONOVISC continued to gain worldwide market share in the third quarter as physicians continue to migrate towards single-injection solutions, resulting in MONOVISC revenue growth of 50% year-over-year for the quarter. Additionally, we advanced our regenerative medicine pipeline with the submission of a 510(k) application to the U.S. Food and Drug Administration for our injectable HA-based bone repair treatment, a promising new opportunity gaining attention in the orthopedic space."

Third Quarter Financial Results

Recent Business Highlights
The Company made key commercial, operational, pipeline, and financial advancements, including:

Conference Call Information
Anika's management will hold a conference call and webcast to discuss its financial results and business highlights tomorrow, Thursday, October 26th at 9:00 am ET. The conference call can be accessed by dialing 1-855-468-0611 (toll-free domestic) or 1-484-756-4332 (international). A live audio webcast will be available in the "Investor Relations" section of Anika's website, www.anikatherapeutics.com. An accompanying slide presentation may also be accessed via the Anika website. A replay of the webcast will be available on Anika's website approximately two hours after the completion of the event.

About Anika Therapeutics, Inc.
Anika Therapeutics, Inc. (NASDAQ: ANIK) is a global, integrated orthopedic medicines company based in Bedford, Massachusetts. Anika is committed to improving the lives of patients with degenerative orthopedic diseases and traumatic conditions with clinically meaningful therapies along the continuum of care, from palliative pain management to regenerative cartilage repair. The Company has over two decades of global expertise developing, manufacturing, and commercializing more than 20 products based on its proprietary hyaluronic acid (HA) technology. Anika's orthopedic medicine portfolio includes ORTHOVISC, MONOVISC, and CINGAL, which alleviate pain and restore joint function by replenishing depleted HA, and HYALOFAST, a solid HA-based scaffold to aid cartilage repair and regeneration. For more information about Anika, please visit www.anikatherapeutics.com.

Forward-Looking Statements
The statements made in the last sentence of the second bullet point and in the fifth bullet point in the section captioned "Recent Business Highlights" of this press release, which are not statements of historical fact, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, those relating to sales expectations with regard to the Company's MONOVISC product and to the Company's appointment of personnel. These statements are based upon the current beliefs and expectations of the Company's management and are subject to significant risks, uncertainties, and other factors. The Company's actual results could differ materially from any anticipated future results, performance, or achievements described in the forward-looking statements as a result of a number of factors including, but not limited to, (i) the Company's ability to successfully commence and/or complete clinical trials of its products on a timely basis or at all; (ii) the Company's ability to obtain pre-clinical or clinical data to support domestic and international pre-market approval applications, 510(k) applications, or new drug applications, or to timely file and receive FDA or other regulatory approvals or clearances of its products; (iii) that such approvals will not be obtained in a timely manner or without the need for additional clinical trials, other testing or regulatory submissions, as applicable; (iv) the Company's research and product development efforts and their relative success, including whether we have any meaningful sales of any new products resulting from such efforts; (v) the cost effectiveness and efficiency of the Company's clinical studies, manufacturing operations, and production planning; (vi) the strength of the economies in which the Company operates or will be operating, as well as the political stability of any of those geographic areas; (vii) future determinations by the Company to allocate resources to products and in directions not presently contemplated; (viii) the Company's ability to successfully commercialize its products, in the U.S. and abroad; (ix) the Company's ability to provide an adequate and timely supply of its products to its customers; and (x) the Company's ability to achieve its growth targets. Additional factors and risks are described in the Company's periodic reports filed with the Securities and Exchange Commission, and they are available on the SEC's website at www.sec.gov. Forward-looking statements are made based on information available to the Company on the date of this press release, and the Company assumes no obligation to update the information contained in this press release.

                 
Anika Therapeutics, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
 
For the Three Months Ended September 30, For the Nine Months Ended September 30,
2017 2016 2017 2016
Product revenue $ 27,178 $ 25,783 $ 78,899 $ 74,636
Licensing, milestone and contract revenue   6     6     5,133   17
Total revenue 27,184 25,789 84,032 74,653
 
Operating expenses:
Cost of product revenue 6,250 4,998 18,648 16,488
Research and development 5,842 2,822 14,521 7,773
Selling, general and administrative   4,823     4,280     14,862   12,525
Total operating expenses   16,915     12,100     48,031   36,786
Income from operations 10,269 13,689 36,001 37,867
Interest income, net   261     93     335   214
Income before income taxes 10,530 13,782 36,336 38,081
Provision for income taxes   3,643     4,830     12,587   13,619
Net income $ 6,887   $ 8,952   $ 23,749 $ 24,462
 
Basic net income per share:
Net income $ 0.47 $ 0.61 $ 1.63 $ 1.66
Basic weighted average common shares outstanding 14,579 14,625 14,572 14,726
Diluted net income per share:
Net income $ 0.46 $ 0.59 $ 1.58 $ 1.61
Diluted weighted average common shares outstanding 15,115 15,077 15,065 15,163
 
 
Anika Therapeutics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
(unaudited)
 
September 30, December 31,
ASSETS 2017 2016
Current assets:
Cash and cash equivalents $ 126,960 $ 104,261
Investments 25,750 20,500
Accounts receivable, net of reserves of $217 and $194 at September 31, 2017 and December 31, 2016, respectively 23,804 27,598
Inventories, net 20,252 15,983
Prepaid expenses and other current assets   2,268     2,098  
Total current assets 199,034 170,440
Property and equipment, net 53,973 52,296
Other long-term assets 1,283 69
Intangible assets, net 10,738 10,227
Goodwill   8,104     7,214  
Total assets $ 273,132   $ 240,246  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 5,189 $ 2,303
Accrued expenses and other current liabilities   6,516     6,496  
Total current liabilities   11,705     8,799  
Other long-term liabilities 545 2,126
Deferred tax liability 7,593 6,548
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value; 1,250 shares authorized, no shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively - -
Common stock, $0.01 par value; 60,000 shares authorized, 14,662 and 14,627 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively 146 146
Additional paid-in-capital 66,746 61,735
Accumulated other comprehensive loss (5,047 ) (7,317 )
Retained earnings   191,444     168,209  

Total stockholders' equity

  253,289     222,773  
Total liabilities and stockholders' equity $ 273,132   $ 240,246  
 

               
Anika Therapeutics, Inc. and Subsidiaries
Supplemental Financial Data
 
 
Revenue by Product Line and Product Gross Margin
(in thousands, except percentages)
(unaudited)
 
For the Three Months Ended September 30, For the Nine Months Ended September 30,
Product Line: 2017   % 2016   % 2017   % 2016   %
Orthobiologics $ 23,990 88 % $ 22,428 87 % $ 68,686 87 % $ 65,319 88 %
Surgical 1,765 7 % 1,173 5 % 4,395 6 % 3,924 5 %
Dermal 358 1 % 594 2 % 1,235 2 % 1,558 2 %
Other   1,065   4 %   1,588   6 %   4,583   5 %   3,835   5 %
Product Revenue $ 27,178   100 % $ 25,783   100 % $ 78,899   100 % $ 74,636   100 %
 
Product Gross Profit $ 20,928 $ 20,785 $ 60,251 $ 58,148
Product Gross Margin

77%

 

81%

 

76%

 

78%

 

 
 
Product Revenue by Geographic Region
(in thousands, except percentages)
(unaudited)
 
For the Three Months Ended September 30, For the Nine Months Ended September 30,
2017 % 2016 % 2017 % 2016 %
Geographic Region:
United States $ 22,227 82 % $ 21,126 82 % $ 63,507 81 % $ 61,032 82 %
Europe 2,832 10 % 2,703 10 % 9,743 12 % 8,240 11 %
Other   2,119   8 %   1,954   8 %   5,649   7 %   5,364   7 %
Product Revenue $ 27,178   100 % $ 25,783   100 % $ 78,899   100 % $ 74,636   100 %
 

Anika Therapeutics, Inc.
Charles H. Sherwood, Ph.D., CEO
Sylvia Cheung, CFO
Tel: 781-457-9000

Source: Anika Therapeutics, Inc.

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