UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 2.02 | Results of Operations and Financial Condition. |
On August 10, 2020, Eagle Pharmaceuticals, Inc., or the Company, issued a press release announcing its financial results for the fiscal second quarter ended June 30, 2020. A copy of the Company’s press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information in this Current Report on Form 8-K, including the information contained in the press release furnished as Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or otherwise subject to the liabilities of that section, and shall not be deemed incorporated by reference into any of the Company’s filings under the Securities Act of 1933, as amended or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits |
| Exhibit No. | Description | |
| 99.1 | Press Release dated August 10, 2020. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: August 10, 2020 | EAGLE PHARMACEUTICALS, INC. | |
| By: | /s/ Scott Tarriff | |
| Scott Tarriff | ||
| Chief Executive Officer |
Exhibit 99.1
For Immediate Release
Eagle Pharmaceuticals Reports Second Quarter 2020 Results
-- Q2 2020 net loss was ($0.02) per basic and diluted share and adjusted non-GAAP net income was $0.59 per basic and $0.57 per diluted share --
-- Anticipate launch of vasopressin, maintaining our 180-day market exclusivity --
-- CMS establishes unique J-code for PEMFEXY™ (pemetrexed for injection); FDA granted supplement approval for 500mg multiple-dose vial --
-- Received positive additional data for the Company’s fulvestrant product candidate, EA-114, for HR-positive advanced breast cancer --
-- Received a Complete Response Letter for NDA for RYANODEX for EHS --
WOODCLIFF LAKE, NJ—August 10, 2020—Eagle Pharmaceuticals, Inc. (Nasdaq: EGRX) (“Eagle” or the “Company”) today announced financial results for the three and six months ended June 30, 2020.
Business and Recent Highlights:
| · | Centers for Medicare & Medicaid Services (“CMS”) established unique Healthcare Common Procedure Coding System (“HCPCS”) code, or J-code, for PEMFEXY™ (Pemetrexed for Injection, 10 mg), a branded alternative to ALIMTA® effective October 1, 2020; |
| · | Granted a supplement approval by U.S. Food and Drug Administration (“FDA”) for 500mg multiple-dose vial of PEMFEXY. The Company has initial market entry (equivalent to approximately a three-week supply of current ALIMTA utilization) on February 1, 2022, and a subsequent uncapped entry on April 1, 2022; |
| · | The Company’s strategic collaboration partner, Tyme Technologies, Inc. (“Tyme”), announced that FDA granted Orphan Drug Designation for its lead product candidate, SM-88, a treatment for patients with pancreatic cancer; |
| · | On August 7, 2020, the Company received a Complete Response Letter for its New Drug Application (“NDA”) for RYANODEX® for the treatment of exertional heat stroke (“EHS”); Eagle has decided that it will no longer pursue this indication; |
| · | Received encouraging recent additional data for the Company’s fulvestrant product candidate, EA-114, for HR-positive advanced breast cancer; next steps are to meet with FDA to finalize clinical trial plans; product could potentially represent cornerstone of Eagle’s oncology franchise treating HR positive breast cancer patients; |
| · | Favorable patent litigation decision issued by the U.S. District Court for the District of Delaware for Eagle and Teva Pharmaceutical Industries Ltd. for BENDEKA® upholding the asserted patent claims as valid and infringed by the defendants’ proposed Abbreviated New Drug Application (“ANDA”) products. Under this decision, defendants are enjoined from launching their ANDA products before 2031; |
Page 2: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
| · | SymBio, the Company’s Japanese licensing partner, announced that it expects regulatory approval of its TREAKISYM Ready-to-Dilute (“RTD”) formulation late this year. Eagle is entitled to receive a $5 million milestone payment upon approval of either TREAKISYM Ready-to-Dilute or TREAKISYM Rapid Infusion, as well as royalties and milestones that could total $10 to $25 million per year if SymBio first launches TREAKISYM RTD and then its Rapid Infusion product; and |
| · | Despite the ongoing COVID-19 pandemic, the Company has not experienced significant disruptions to its supply chain to date, and believes it has sufficient supply chain inventory to continue manufacturing and to provide product without interruption consistent with its current business plan; the Company has experienced limited impacts on the timing of its pre-clinical programs due to the COVID-19 pandemic; the Company continues to monitor the ongoing pandemic and evaluate and evolve its business plans and response strategy thereto. |
Second Quarter 2020 Financial Highlights
| · | Total revenue for Q2 2020 was $41.9 million, compared to $56.7 million in Q2 2019, primarily reflecting lower product sales of BELRAPZO® and BENDEKA, partially offset by higher product sales of RYANODEX. |
| · | Net loss for Q2 2020 was $0.3 million, or ($0.02) per basic and diluted share, compared to net income for Q2 2019 of $6.7 million, or $0.49 per basic and $0.48 per diluted share. |
| · | Adjusted non-GAAP net income for Q2 2020 was $8.0 million, or $0.59 per basic and $0.57 per diluted share, compared to adjusted non-GAAP net income for Q2 2019 of $11.8 million, or $0.86 per basic and $0.84 per diluted share. |
| · | Cash and cash equivalents were $108.2 million, net accounts receivable was $46.8 million, and debt was $37.0 million as of June 30, 2020. |
“We had an excellent start to the first half of the year, advancing our exciting pipeline of oncology and critical care products. Our ANDA and orphan drug exclusivity legal wins for BENDEKA, CMS’ decision to establish a separate J-Code and supplement approval for the 500mg dose for PEMFEXY, along with continued progress on our fulvestrant product candidate and the opportunity for vasopressin, supports the diversification and acceleration of Eagle’s earnings power,” stated Scott Tarriff, Chief Executive Officer of Eagle Pharmaceuticals.
“We’re also pleased with our collaborations with Tyme, NorthShore University HealthSystem, and UPenn to advance important products. Furthermore, we have made progress on the study of RYANODEX for the treatment of brain damage secondary to Nerve Agent exposure, as we continue to pursue expanded indications. We have important work ahead in the second half of the year, regardless of EHS, and we will continue to identify opportunities that fulfill our strategic vision and bring innovative therapeutics to the patients who can benefit,” concluded Tarriff.
Second Quarter 2020 Financial Results
Total revenue for Q2 2020 was $41.9 million, as compared to $56.7 million for Q2 2019.
Page 3: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
Q2 2020 BELRAPZO product sales were $4.1 million, compared to $15.4 million in Q2 2019. Second quarter 2019 BELRAPZO revenue reflected wholesaler stocking occasioned by the June 2019 transition to the branded name.
Q2 2020 RYANODEX product sales were $4.7 million, compared to $2.9 million in Q2 2019.
Royalty revenue was $27.6 million in the second quarter of 2020, compared to $27.3 million in the second quarter of 2019. BENDEKA royalties were $27.5 million in the second quarter of 2020, compared to $26.5 million in the second quarter of 2019. A summary of total revenue is outlined below:
| Three Months Ended March 31, | ||||||||
| 2020 | 2019 | |||||||
| (unaudited) | (unaudited) | |||||||
| Revenue (in thousands): | ||||||||
| Product sales | $ | 14,376 | $ | 29,437 | ||||
| Royalty revenue | 27,562 | 27,265 | ||||||
| Total revenue | $ | 41,938 | $ | 56,702 | ||||
Gross margin was 69% during the second quarter of 2020, as compared to 62% in the second quarter of 2019. The expansion in gross margin in the second quarter of 2020 was driven by an increase in RYANODEX product sales, lower BENDEKA product sales in the period to the Company’s marketing partner, on which Eagle earns no profit, and the increase in BENDEKA royalty revenue.
R&D expense was $7.1 million for the second quarter of 2020, compared to $9.0 million in the second quarter of 2019. The change primarily resulted from a decrease in spending for vasopressin, partly offset by an increase in spending for the Company’s fulvestrant product candidate. Excluding stock-based compensation and other non-cash and non-recurring items, R&D expense during the second quarter of 2020 was $6.0 million.
SG&A expense in the second quarter of 2020 increased to $18.0 million compared to $17.2 million in the second quarter of 2019. The change primarily resulted from an increase in stock compensation expense, partially offset by decreases in T&E, trade show costs, and external legal expenses. Excluding stock-based compensation and other non-cash and non-recurring items, second quarter 2020 SG&A expense was $12.2 million.
Net loss for the second quarter of 2020 was $0.3 million, or ($0.02) per basic and diluted share, compared to net income of $6.7 million, or $0.49 per basic and $0.48 per diluted share, in the second quarter of 2019.
Adjusted non-GAAP net income for the second quarter of 2020 was $8.0 million, or $0.59 per basic and $0.57 per diluted share, compared to adjusted non-GAAP net income of $11.8 million or $0.86 per basic and $0.84 per diluted share in the second quarter of 2019. For a full reconciliation of adjusted non-GAAP net income to the most comparable GAAP financial measures, please see the tables at the end of this press release.
2020 Expense Guidance
| · | As a result of COVID-related delays, with respect to our pre-clinical programs, we are lowering our previously reported 2020 R&D Non-GAAP expense guidance to $40 million-$44 million, as compared to $31 million in 2019. |
Page 4: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
| · | SG&A spend in 2020, on a non-GAAP basis, is expected to be $61-$64 million, as compared to $56 million in 2019. |
The guidance provided in this section represents forward-looking information, and actual results may vary. Please see the risks and assumptions referred to in the Forward-Looking Statements section of this press release.
Liquidity
As of June 30, 2020, the Company had $108.2 million in cash and cash equivalents plus $46.8 million in net accounts receivable, $35.7 million of which was due from Teva. The Company had $37.0 million in outstanding debt. Therefore, at June 30, 2020, the Company had net cash plus receivables of $118.0 million. In the second quarter of 2020, the Company repaid the full $110.0 million amount borrowed under its revolving credit facility.
In the second quarter of 2020, the Company repurchased $4.0 million of Eagle’s common stock as part of the share repurchase program. From August 2016 through June 30, 2020, the Company repurchased $176.9 million of its common stock.
Conference Call
As previously announced, Eagle management will host its second quarter 2020 conference call as follows:
| Date | Monday, August 10, 2020 | |
| Time | 8:30 A.M. ET | |
| Toll free (U.S.) | 877-876-9173 | |
| International | 785-424-1667 | |
| Webcast (live and replay) | www.eagleus.com, under the “Investor + News” section |
Participants should dial in 15 minutes prior to the start of the call to ensure timely access.
A replay of the conference call will be available for one week after the call's completion by dialing 800-839-4014 (US) or 402-220-2983 (International) and entering conference call ID EGRXQ220. The webcast will be archived for 30 days at the aforementioned URL.
About Eagle Pharmaceuticals, Inc.
Eagle is a fully integrated pharmaceutical company with research and development, clinical, manufacturing and commercial expertise. Eagle is committed to developing innovative medicines that result in meaningful improvements in patients’ lives. Eagle’s commercialized products include RYANODEX®, BENDEKA®, BELRAPZO®, and its oncology and CNS/metabolic critical care pipeline includes product candidates with the potential to address underserved therapeutic areas across multiple disease states. Additional information is available on Eagle’s website at www.eagleus.com.
Page 5: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
Forward-Looking Statements
This press release contains forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, and other securities laws. Forward-looking statements are statements that are not historical facts. Words and phrases such as “anticipated,” “forward,” “will,” “would,” “may,” “remain,” “potential,” “prepare,” “expected,” “believe,” “plan,” “near future,” “belief,” “guidance,” and similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to, statements regarding future events such as: the Company’s expectations regarding the current and anticipated impact of the ongoing COVID-19 pandemic on the Company’s business and operations, including sales, marketing, manufacturing and supply chain interruptions; the number and timing of potential product launches, development initiatives and new indications for RYANODEX, including for the treatment of brain damage secondary to Nerve Agent exposure; the Company’s clinical development plan for its fulvestrant product candidate, EA-114, as well as the development efforts for the other product candidates in its portfolio; the timing of the Company’s PEMFEXY and vasopressin launches, if ever; the period of market exclusivity for vasopressin; the success of the Company’s collaborations with its strategic partners; the Company’s expense guidance for fiscal year 2020; the Company’s expectations with respect to earnings power, including statements regarding the Company’s ability to diversify and accelerate earnings power; the Company's ability to deliver value in 2020 and over the long term; and the Company’s plans and ability to advance the products in its pipeline. All of such statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the Company’s control, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Such risks and uncertainties include, but are not limited to: the impacts of the ongoing COVID-19 pandemic, including disruption or impact in the sales of the Company’s marketed products, interruptions or other adverse effects to clinical trials, delays in regulatory review, manufacturing and supply chain interruptions, adverse effects on healthcare systems, disruption in the operations of the Company’s third party partners and disruption of the global economy, and the overall impact of the COVID-19 pandemic on the Company’s business, financial condition and results of operations; risks that the Company’s business, financial condition and results of operations will be impacted by the continued spread of COVID-19 in the geographies where the Company’s third-party partners operate; whether the Company will incur unforeseen expenses or liabilities or other market factors; whether the Company will successfully implement its development plan for its fulvestrant product candidate, EA-114, or other product candidates; delay in or failure to obtain regulatory approval of the Company’s product candidates; whether the Company can successfully market and commercialize its product candidates, including RYANODEX, BENDEKA and BELRAPZO; the success of the Company’s relationships with its partners, including the University of Pennsylvania, Teva, Tyme and NorthShore University HealthSystem and the parties’ ability to work effectively together; the availability and pricing of third party sourced products and materials; the outcome of litigation involving any of our products or that may have an impact on any of our products; successful compliance with the FDA and other governmental regulations applicable to product approvals, manufacturing facilities, products and/or businesses; general economic conditions, including the potential adverse effects of public health issues, including the COVID-19 pandemic, on economic activity and the performance of the financial markets generally; the strength and enforceability of the Company’s intellectual property rights or the rights of third parties; competition from other pharmaceutical and biotechnology companies and the potential for competition from generic entrants into the market; the risks inherent in the early stages of drug development and in conducting clinical trials; and those risks and uncertainties identified in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the Securities and Exchange Commission on March 2, 2020 and its other subsequent filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof, and the Company does not undertake any obligation to revise and disseminate forward-looking statements to reflect events or circumstances after the date hereof, or to reflect the occurrence of or non-occurrence of any events.
Page 6: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
Non-GAAP Financial Performance Measures
In addition to financial information prepared in accordance with U.S. GAAP, this press release also contains adjusted non-GAAP net income and adjusted non-GAAP earnings per share attributable to Eagle. The Company believes these measures provide investors and management with supplemental information relating to operating performance and trends that facilitate comparisons between periods and with respect to projected information.
Adjusted non-GAAP net income excludes stock-based compensation expense, depreciation expense, amortization expense, severance, non-cash interest expense, expense related to collaboration with Tyme, fair value adjustments on equity investment, and the tax effect of these adjustments. The Company believes these non-GAAP financial measures help indicate underlying trends in the Company’s business and are important in comparing current results with prior period results and understanding projected operating performance. Non-GAAP financial measures provide the Company and its investors with an indication of the Company’s baseline performance before items that are considered by the Company not to be reflective of the Company’s ongoing results. See the attached Reconciliation of GAAP to Adjusted Non-GAAP Net Income and Adjusted Non-GAAP Earnings per Share and Reconciliation of GAAP to Adjusted Non-GAAP EBITDA for details of the amounts excluded and included to arrive at adjusted non-GAAP net income, adjusted non-GAAP earnings per share amounts, and adjusted non-GAAP EBITDA amounts, respectively.
These adjusted measures are non-GAAP and should be considered in addition to, but not as a substitute for, the information prepared in accordance with U.S. GAAP. The Company strongly encourages investors to review its consolidated financial statements and publicly-filed reports in their entirety and cautions investors that the non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures.
Investor Relations for Eagle Pharmaceuticals, Inc.:
Lisa M. Wilson
In-Site Communications, Inc.
T: 212-452-2793
E: lwilson@insitecony.com
Public Relations for Eagle Pharmaceuticals, Inc.:
Faith Pomeroy-Ward
T: 817-807-8044
E: faith@fpwservices.com
-- Financial tables follow --
Page 7: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
EAGLE PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands, except share amounts)
| June 30, 2020 |
December 31, 2019 |
|||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 108,213 | $ | 109,775 | ||||
| Accounts receivable, net | 46,781 | 48,004 | ||||||
| Inventories | 7,891 | 6,566 | ||||||
| Prepaid expenses and other current assets | 5,551 | 15,104 | ||||||
| Total current assets | 168,436 | 179,449 | ||||||
| Property and equipment, net | 2,118 | 2,202 | ||||||
| Intangible assets, net | 14,250 | 15,583 | ||||||
| Goodwill | 39,743 | 39,743 | ||||||
| Deferred tax asset, net | 14,585 | 13,669 | ||||||
| Other assets | 17,578 | 3,908 | ||||||
| Total assets | $ | 256,710 | $ | 254,554 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 13,708 | $ | 5,462 | ||||
| Accrued expenses and other liabilities | 19,778 | 28,361 | ||||||
| Current portion of long-term debt | 7,000 | 5,000 | ||||||
| Total current liabilities | 40,486 | 38,823 | ||||||
| Other long-term liabilities | 3,361 | 3,000 | ||||||
| Long-term debt, less current portion | 28,899 | 33,557 | ||||||
| Total liabilities | $ | 72,746 | 75,380 | |||||
| Commitments and Contingencies | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, 1,500,000 shares authorized and no shares issued or outstanding as of June 30, 2020 and December 31, 2019 | — | — | ||||||
| Common stock, $0.001 par value; 50,000,000 shares authorized; 16,621,681 and 16,537,846 shares issued as of June 30, 2020 and December 31, 2019, respectively | 17 | 17 | ||||||
| Additional paid in capital | 291,434 | 278,518 | ||||||
| Retained earnings | 69,373 | 72,500 | ||||||
| Treasury stock, at cost, 3,017,710 and 2,907,687 shares as of June 30, 2020 and December 31, 2019, respectively | (176,860 | ) | (171,861 | ) | ||||
| Total stockholders' equity | 183,964 | 179,174 | ||||||
| Total liabilities and stockholders' equity | $ | 256,710 | $ | 254,554 | ||||
Page 8: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
EAGLE PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except share and per share amounts)
| Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Revenue: | ||||||||||||||||
| Product sales | $ | 14,376 | $ | 29,437 | $ | 32,070 | $ | 43,909 | ||||||||
| Royalty revenue | 27,562 | 27,265 | 55,888 | 53,578 | ||||||||||||
| License and other revenue | — | — | — | 9,000 | ||||||||||||
| Total revenue | 41,938 | 56,702 | 87,958 | 106,487 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Cost of product sales | 10,313 | 18,175 | 15,078 | 27,729 | ||||||||||||
| Cost of royalty revenue | 2,822 | 3,109 | 5,860 | 6,655 | ||||||||||||
| Research and development | 7,135 | 8,957 | 16,562 | 15,332 | ||||||||||||
| Selling, general and administrative | 17,959 | 17,228 | 42,714 | 35,369 | ||||||||||||
| Total operating expenses | 38,229 | 47,469 | 80,214 | 85,085 | ||||||||||||
| Income from operations | 3,709 | 9,233 | 7,744 | 21,402 | ||||||||||||
| Interest income | 150 | 637 | 496 | 1,131 | ||||||||||||
| Interest expense | (786 | ) | (665 | ) | (1,675 | ) | (1,351 | ) | ||||||||
| Other income (expense) | 2,300 | — | (4,200 | ) | — | |||||||||||
| Total other income (expense), net | 1,664 | (28 | ) | (5,379 | ) | (220 | ) | |||||||||
| Income before income tax provision | 5,373 | 9,205 | 2,365 | 21,182 | ||||||||||||
| Income tax provision | (5,629 | ) | (2,480 | ) | (5,492 | ) | (5,484 | ) | ||||||||
| Net (Loss) Income | $ | (256 | ) | $ | 6,725 | $ | (3,127 | ) | $ | 15,698 | ||||||
| (Loss) Earnings per share attributable to common stockholders: | ||||||||||||||||
| Basic | $ | (0.02 | ) | $ | 0.49 | $ | (0.23 | ) | $ | 1.13 | ||||||
| Diluted | $ | (0.02 | ) | $ | 0.48 | $ | (0.23 | ) | $ | 1.11 | ||||||
| Weighted average number of common shares outstanding: | ||||||||||||||||
| Basic | 13,664,951 | 13,782,720 | 13,666,279 | 13,853,580 | ||||||||||||
| Diluted | 13,664,951 | 14,156,627 | 13,666,279 | 14,176,297 | ||||||||||||
Page 9: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
EAGLE PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)
| Six Months Ended June 30, | ||||||||
| 2020 | 2019 | |||||||
| Cash flows from operating activities: | ||||||||
| Net (loss) income | $ | (3,127 | ) | $ | 15,698 | |||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||
| Deferred income taxes | (916 | ) | (127 | ) | ||||
| Depreciation expense | 931 | 1,005 | ||||||
| Amortization expense | 1,333 | 1,260 | ||||||
| Fair value adjustments on equity investment | 4,200 | — | ||||||
| Stock-based compensation expense | 13,713 | 11,164 | ||||||
| Amortization of debt issuance costs | 183 | 188 | ||||||
| Changes in operating assets and liabilities which provided (used) cash: | ||||||||
| Accounts receivable | 1,223 | 6,147 | ||||||
| Inventories | (1,325 | ) | (3,290 | ) | ||||
| Prepaid expenses and other current assets | 9,553 | 4,665 | ||||||
| Accounts payable | 8,246 | 7,379 | ||||||
| Accrued expenses and other liabilities | (8,583 | ) | 4,880 | |||||
| Other assets and other long-term liabilities, net | (1,321 | ) | (396 | ) | ||||
| Net cash provided by operating activities | 24,110 | 48,573 | ||||||
| Cash flows from investing activities: | ||||||||
| Purchase of equity investment security | (17,500 | ) | — | |||||
| Purchase of property and equipment | (376 | ) | (343 | ) | ||||
| Net cash used in investing activities | (17,876 | ) | (343 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from common stock option exercises | 513 | 55 | ||||||
| Employee withholding taxes related to stock-based awards | (1,310 | ) | (198 | ) | ||||
| Proceeds from existing revolving credit facility | 110,000 | — | ||||||
| Repayment of existing revolving credit facility | (110,000 | ) | — | |||||
| Payment of debt | (2,000 | ) | (3,750 | ) | ||||
| Repurchases of common stock | (4,999 | ) | (15,000 | ) | ||||
| Net cash used in financing activities | (7,796 | ) | (18,893 | ) | ||||
| Net (decrease) increase in cash and cash equivalents | (1,562 | ) | 29,337 | |||||
| Cash and cash equivalents at beginning of period | 109,775 | 78,791 | ||||||
| Cash and cash equivalents at end of period | $ | 108,213 | $ | 108,128 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid during the period for: | ||||||||
| Income taxes, net | $ | 502 | $ | 2,874 | ||||
| Interest | 1,458 | 1,221 | ||||||
| Right-of-use asset obtained in exchange for lease obligation - lease amendment | 842 | 2,871 | ||||||
Page 10: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
EAGLE PHARMACEUTICALS, INC.
RECONCILIATION OF GAAP TO ADJUSTED NON-GAAP NET INCOME AND
ADJUSTED NON-GAAP EARNINGS PER SHARE (UNAUDITED)
(In thousands, except share and per share amounts)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||
| Net (loss) income - GAAP | $ | (256 | ) | $ | 6,725 | $ | (3,127 | ) | $ | 15,698 | ||||||
| Adjustments: | ||||||||||||||||
| Cost of product revenues: | ||||||||||||||||
| Amortization expense | 262 | 225 | 523 | 450 | ||||||||||||
| Research and development: | ||||||||||||||||
| Stock-based compensation expense | 1,034 | 1,096 | 2,584 | 2,239 | ||||||||||||
| Depreciation expense | 60 | 70 | 134 | 139 | ||||||||||||
| Selling, general and administrative: | ||||||||||||||||
| Stock-based compensation expense | 5,207 | 4,286 | 11,129 | 8,925 | ||||||||||||
| Expense related to collaboration with Tyme | - | - | 2,500 | - | ||||||||||||
| Amortization expense | 405 | 405 | 810 | 810 | ||||||||||||
| Depreciation expense | 149 | 172 | 326 | 344 | ||||||||||||
| Severance | - | - | 245 | - | ||||||||||||
| Other: | ||||||||||||||||
| Non-cash interest expense | 118 | 94 | 236 | 188 | ||||||||||||
| Fair value adjustments on equity investment | (2,300 | ) | - | 4,200 | - | |||||||||||
| Tax effect of the non-GAAP adjustments | 3,344 | (1,228 | ) | (3,457 | ) | (2,319 | ) | |||||||||
| Adjusted non-GAAP net income | $ | 8,023 | $ | 11,845 | $ | 16,103 | $ | 26,474 | ||||||||
| Adjusted non-GAAP earnings per share: | ||||||||||||||||
| Basic | $ | 0.59 | $ | 0.86 | $ | 1.18 | $ | 1.91 | ||||||||
| Diluted | $ | 0.57 | $ | 0.84 | $ | 1.15 | $ | 1.87 | ||||||||
| Weighted number of common shares outstanding: | ||||||||||||||||
| Basic | 13,664,951 | 13,782,720 | 13,666,279 | 13,853,580 | ||||||||||||
| Diluted | 13,971,725 | 14,156,627 | 13,983,093 | 14,176,297 | ||||||||||||
Page 11: Eagle Pharmaceuticals Reports Second Quarter 2020 Results
EAGLE PHARMACEUTICALS, INC.
RECONCILIATION OF GAAP TO ADJUSTED NON-GAAP EBITDA (UNAUDITED)
(In thousands)
| Three Months Ended June 30, |
Six Months Ended June 30, |
Twelve Months Ended June 30, |
Twelve Months Ended December 31, |
|||||||||||||||||||||
| 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |||||||||||||||||||
| Net (loss) income - GAAP | $ | 256 | $ | 6,725 | $ | (3,127 | ) | $ | 15,698 | $ | (4,512 | ) | $ | 14,313 | ||||||||||
| Add back: | ||||||||||||||||||||||||
| Interest expense, net of interest income | 636 | 28 | 1,179 | 220 | 1,476 | 517 | ||||||||||||||||||
| Income tax provision | 5,629 | 2,480 | 5,492 | 5,484 | 7,693 | 7,685 | ||||||||||||||||||
| Depreciation and amortization expense | 876 | 872 | 1,793 | 1,743 | 3,542 | 3,492 | ||||||||||||||||||
| Add back: | ||||||||||||||||||||||||
| Stock-based compensation expense | 6,241 | 5,382 | 13,713 | 11,164 | 24,547 | 21,998 | ||||||||||||||||||
| Debt issuance cost | - | - | - | - | 88 | 88 | ||||||||||||||||||
| Fair value adjustments on equity investment | (2,300 | ) | - | 4,200 | - | 4,200 | - | |||||||||||||||||
| Expense of acquired in-process research & development | - | - | - | - | 500 | 500 | ||||||||||||||||||
| Expense related to collaboration with Tyme | - | - | 2,500 | - | 2,500 | - | ||||||||||||||||||
| Severance | - | - | 245 | - | 700 | 455 | ||||||||||||||||||
| Adjusted Non-GAAP EBITDA | $ | 10,826 | $ | 15,487 | $ | 25,995 | $ | 34,309 | $ | 40,734 | $ | 49,048 | ||||||||||||