☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 76-0837053 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |
355 Alhambra Circle Suite 801 Coral Gables, Florida | 33134 | |
(Address of principal executive offices) | (Zip Code) |
Title of Each Class | Ticker Symbol | Name of Exchange on Which Registered |
Common Stock, par value $0.001 per share | CPRX | NASDAQ Capital Market |
Large accelerated filer | ☐ | Accelerated Filer | ☒ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
Item 1. | ||||||
3 | ||||||
4 | ||||||
5 | ||||||
6 | ||||||
7 | ||||||
Item 2. | ||||||
Item 3. | ||||||
Item 4. | ||||||
Item 1. | ||||||
Item 1A. | ||||||
Item 2. | ||||||
Item 3. | ||||||
Item 4. | ||||||
Item 5. | ||||||
Item 6. | ||||||
June 30, 2021 | December 31, 2020 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 135,295 | $ | 130,237 | ||||
Short-term investments | 19,980 | 10,041 | ||||||
Accounts receivable, net | 6,292 | 5,987 | ||||||
Inventory | 7,097 | 4,651 | ||||||
Prepaid expenses and other current assets | 7,641 | 8,328 | ||||||
Total current assets | 176,305 | 159,244 | ||||||
Operating lease right-of-use | 3,201 | — | ||||||
Property and equipment, net | 914 | 130 | ||||||
Deferred tax assets | 28,701 | 32,971 | ||||||
Deposits | 9 | 9 | ||||||
Total assets | $ | 209,130 | $ | 192,354 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 2,924 | $ | 4,256 | ||||
Accrued expenses and other liabilities | 13,211 | 18,500 | ||||||
Total current liabilities | 16,135 | 22,756 | ||||||
Operating lease liability, net of current portion | 4,051 | — | ||||||
Total liabilities | 20,186 | 22,756 | ||||||
Commitments and contingencies (Note 10) | 0 | 0 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: NaN issued and outstanding at June 30, 2021 and December 31, 2020 | 0 | — | ||||||
Common stock, $0.001 par value, 200,000,000 shares authorized; 103,162,041 shares outstanding at June 30, 2021 and December 31, 2020, respectively | 103 | 104 | ||||||
Additional paid-in capital | 226,699 | 223,168 | ||||||
Accumulated deficit | (37,821 | ) | (53,705 | ) | ||||
Accumulated other comprehensive income (loss) | (37 | ) | 31 | |||||
Total stockholders’ equity | 188,944 | 169,598 | ||||||
Total liabilities and stockholders’ equity | $ | 209,130 | $ | 192,354 | ||||
June 30, 2022 | December 31, 2021 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 210,912 | $ | 171,445 | ||||
Short-term investments | 9,876 | 19,821 | ||||||
Accounts receivable, net | 9,587 | 6,619 | ||||||
Inventory | 7,850 | 7,870 | ||||||
Prepaid expenses and other current assets | 4,333 | 4,351 | ||||||
Total current assets | 242,558 | 210,106 | ||||||
Operating lease right-of-use | 2,895 | 3,017 | ||||||
Property and equipment, net | 917 | 959 | ||||||
Deferred tax assets, net | 20,930 | 23,697 | ||||||
Deposits | 9 | 9 | ||||||
Total assets | $ | 267,309 | $ | 237,788 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 2,315 | $ | 2,768 | ||||
Accrued expenses and other liabilities | 20,173 | 24,295 | ||||||
Total current liabilities | 22,488 | 27,063 | ||||||
Operating lease liability, net of current portion | 3,729 | 3,894 | ||||||
Total liabilities | 26,217 | 30,957 | ||||||
Commitments and contingencies (Note 1 1 ) | 0 | 0 | ||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: NaN issued and outstanding at June 30, 2022 and December 31, 2021 | — | — | ||||||
Common stock, $0.001 par value, 200,000,000 shares authorized; 102,709,348 shares and 102,992,913 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively | 103 | 103 | ||||||
Additional paid-in capital | 239,476 | 233,186 | ||||||
Retained earnings (accumulated deficit) | 1,643 | (26,310 | ) | |||||
Accumulated other comprehensive income (loss) (Note 4) | (130 | ) | (148 | ) | ||||
Total stockholders’ equity | 241,092 | 206,831 | ||||||
Total liabilities and stockholders’ equity | $ | 267,309 | $ | 237,788 | ||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenues: | ||||||||||||||||
Product revenue, net | $ | 33,636 | $ | 29,605 | $ | 63,841 | $ | 58,741 | ||||||||
License and other revenue | 2,729 | — | 2,729 | — | ||||||||||||
Total revenues | 36,365 | 29,605 | 66,570 | 58,741 | ||||||||||||
Operating costs and expenses: | ||||||||||||||||
Cost of sales | 4,545 | 4,140 | 9,226 | 8,291 | ||||||||||||
Research and development | 4,450 | 4,350 | 7,457 | 8,573 | ||||||||||||
Selling, general and administrative | 11,532 | 10,833 | 24,248 | 20,896 | ||||||||||||
Total operating costs and expenses | 20,527 | 19,323 | 40,931 | 37,760 | ||||||||||||
Operating income | 15,838 | 10,282 | 25,639 | 20,981 | ||||||||||||
Other income, net | 62 | 111 | 143 | 448 | ||||||||||||
Net income before income taxes | 15,900 | 10,393 | 25,782 | 21,429 | ||||||||||||
Provision for income taxes | 3,719 | 613 | 5,938 | 1,223 | ||||||||||||
Net income | $ | 12,181 | $ | 9,780 | $ | 19,844 | $ | 20,206 | ||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.12 | $ | 0.09 | $ | 0.19 | $ | 0.20 | ||||||||
Diluted | $ | 0.11 | $ | 0.09 | $ | 0.18 | $ | 0.19 | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 103,407,803 | 103,414,523 | 103,610,138 | 103,410,881 | ||||||||||||
Diluted | 107,734,924 | 106,730,423 | 107,299,262 | 106,433,862 | ||||||||||||
Net income | $ | 12,181 | $ | 9,780 | $ | 19,844 | $ | 20,206 | ||||||||
Other comprehensive income: | ||||||||||||||||
Unrealized gain (loss) on available-for-sale | 8 | (85 | ) | (68 | ) | (11 | ) | |||||||||
Comprehensive income | $ | 12,189 | $ | 9,695 | $ | 19,776 | $ | 20,195 | ||||||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Revenues: | ||||||||||||||||
Product revenue, net | $ | 53,049 | $ | 33,636 | $ | 96,082 | $ | 63,841 | ||||||||
License and other revenue | 64 | 2,729 | 120 | 2,729 | ||||||||||||
Total revenues | 53,113 | 36,365 | 96,202 | 66,570 | ||||||||||||
Operating costs and expenses: | ||||||||||||||||
Cost of sales | 7,643 | 4,545 | 13,533 | 9,226 | ||||||||||||
Research and development | 3,983 | 4,450 | 7,386 | 7,457 | ||||||||||||
Selling, general and administrative | 12,918 | 11,532 | 29,348 | 24,248 | ||||||||||||
Total operating costs and expenses | 24,544 | 20,527 | 50,267 | 40,931 | ||||||||||||
Operating income | 28,569 | 15,838 | 45,935 | 25,639 | ||||||||||||
Other income ( expense ), net | (324 | ) | 62 | (231 | ) | 143 | ||||||||||
Net income before income taxes | 28,245 | 15,900 | 45,704 | 25,782 | ||||||||||||
Income tax provision | 6,626 | 3,719 | 10,844 | 5,938 | ||||||||||||
Net income | $ | 21,619 | $ | 12,181 | $ | 34,860 | $ | 19,844 | ||||||||
Net income per share: | ||||||||||||||||
Basic | $ | 0.21 | $ | 0.12 | $ | 0.34 | $ | 0.19 | ||||||||
Diluted | $ | 0.20 | $ | 0.11 | $ | 0.32 | $ | 0.18 | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 102,795,600 | 103,407,803 | 102,788,719 | 103,610,138 | ||||||||||||
Diluted | 109,264,730 | 107,734,924 | 109,149,185 | 107,299,262 | ||||||||||||
Net income | $ | 21,619 | $ | 12,181 | $ | 34,860 | $ | 19,844 | ||||||||
Other comprehensive income (Note 4): | ||||||||||||||||
Unrealized gain (loss) on available-for-sale ( $101), $0, (7) and $0, respectively | 323 | 8 | 18 | (68 | ) | |||||||||||
Comprehensive income | $ | 21,942 | $ | 12,189 | $ | 34,878 | $ | 19,776 | ||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Gain (Loss) | Total | |||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||
Balance at December 31, 2020 | $ | — | 103,782 | $ | 104 | $ | 223,168 | $ | (53,705 | ) | $ | 31 | $ | 169,598 | ||||||||||||||
Issuance of stock options for services | — | — | — | 1,442 | — | — | 1,442 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 90 | — | 188 | — | — | 188 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 129 | — | — | 129 | |||||||||||||||||||||
Repurchase of common stock | — | (67 | ) | — | — | (293 | ) | — | (293 | ) | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (76 | ) | (76 | ) | |||||||||||||||||||
Net income | — | — | — | — | 7,663 | — | 7,663 | |||||||||||||||||||||
Balance at March 31, 2021 | — | 103,805 | 104 | 224,927 | (46,335 | ) | (45 | ) | 178,651 | |||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,388 | — | — | 1,388 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 83 | — | 271 | — | — | 271 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 130 | — | — | 130 | |||||||||||||||||||||
Repurchase of common stock | — | (733 | ) | (1 | ) | — | (3,667 | ) | — | (3,668 | ) | |||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net | — | 7 | — | (17 | ) | — | — | (17 | ) | |||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 8 | 8 | |||||||||||||||||||||
Net income | — | — | — | — | 12,181 | — | 12,181 | |||||||||||||||||||||
Balance at June 30, 2021 | $ | — | 103,162 | $ | 103 | $ | 226,699 | $ | (37,821 | ) | $ | (37 | ) | $ | 188,944 | |||||||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Gain (Loss) | Total | |||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | — | 102,993 | $ | 103 | $ | 233,186 | $ | (26,310 | ) | $ | (148 | ) | $ | 206,831 | |||||||||||||
Issuance of stock options for services | — | — | — | 1,623 | — | — | 1,623 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 364 | — | 1,102 | — | — | 1,102 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 280 | — | — | 280 | |||||||||||||||||||||
Repurchase of common stock | — | (400 | ) | — | — | (2,551 | ) | — | (2,551 | ) | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (305 | ) | (305 | ) | |||||||||||||||||||
Net income | — | — | — | — | 13,241 | — | 13,241 | |||||||||||||||||||||
Balance at March 31, 2022 | — | 102,957 | 103 | 236,191 | (15,620 | ) | (453 | ) | 220,221 | |||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,594 | — | — | 1,594 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 345 | — | 1,282 | — | — | 1,282 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 429 | — | — | 429 | |||||||||||||||||||||
Repurchase of common stock | — | (600 | ) | — | — | (4,356 | ) | — | (4,356 | ) | ||||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net | — | 7 | — | (20 | ) | — | — | (20 | ) | |||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 323 | 323 | |||||||||||||||||||||
Net income | — | — | — | — | 21,619 | — | 21,619 | |||||||||||||||||||||
Balance at June 30, 2022 | $ | — | 102,709 | $ | 103 | $ | 239,476 | $ | 1,643 | $ | (130 | ) | $ | 241,092 | ||||||||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Gain (Loss) | Total | |||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||
Balance at December 31, 2019 | $ | — | 103,397 | $ | 103 | $ | 216,206 | $ | (128,689 | ) | $ | 10 | $ | 87,630 | ||||||||||||||
Issuance of stock options for services | — | — | — | 1,384 | — | — | 1,384 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 12 | — | 26 | — | — | 26 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 136 | — | — | 136 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 74 | 74 | |||||||||||||||||||||
Net income | — | — | — | — | 10,426 | — | 10,426 | |||||||||||||||||||||
Balance at March 31, 2020 | — | 103,409 | 103 | 217,752 | (118,263 | ) | 84 | 99,676 | ||||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,627 | — | — | 1,627 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 13 | — | 36 | — | — | 36 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 167 | — | — | 167 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (85 | ) | (85 | ) | |||||||||||||||||||
Net income | — | — | — | — | 9,780 | — | 9,780 | |||||||||||||||||||||
Balance at June 30, 2020 | $ | — | 103,422 | $ | 103 | $ | 219,582 | $ | (108,483 | ) | $ | (1 | ) | $ | 111,201 | |||||||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Gain (Loss) | Total | |||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||
Balance at December 31, 2020 | $ | — | 103,782 | $ | 104 | $ | 223,168 | $ | (53,705 | ) | $ | 31 | $ | 169,598 | ||||||||||||||
Issuance of stock options for services | — | — | — | 1,442 | — | — | 1,442 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 90 | — | 188 | — | — | 188 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 129 | — | — | 129 | |||||||||||||||||||||
Repurchase of common stock | — | (67 | ) | — | — | (293 | ) | — | (293 | ) | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (76 | ) | (76 | ) | |||||||||||||||||||
Net income | — | — | — | — | 7,663 | — | 7,663 | |||||||||||||||||||||
Balance at March 31, 2021 | — | 103,805 | 104 | 224,927 | (46,335 | ) | (45 | ) | 178,651 | |||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,388 | — | — | 1,388 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 83 | — | 271 | — | — | 271 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 130 | — | — | 130 | |||||||||||||||||||||
Repurchase of common stock | — | (733 | ) | (1 | ) | — | (3,667 | ) | — | (3,668 | ) | |||||||||||||||||
Issuance of common stock upon vesting of restricted stock units, net | — | 7 | — | (17 | ) | — | — | (17 | ) | |||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 8 | 8 | |||||||||||||||||||||
Net income | — | — | — | — | 12,181 | — | 12,181 | |||||||||||||||||||||
Balance at June 30, 2021 | $ | — | 103,162 | $ | 103 | $ | 226,699 | $ | (37,821 | ) | $ | (37 | ) | $ | 188,944 | |||||||||||||
For the Six Months Ended June 30, | ||||||||
2021 | 2020 | |||||||
Operating Activities: | ||||||||
Net income | $ | 19,844 | $ | 20,206 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 128 | 43 | ||||||
Stock-based compensation | 3,089 | 3,314 | ||||||
Deferred taxes | 4,270 | — | ||||||
Change in accrued interest and accretion of discount on investments | (6 | ) | (4 | ) | ||||
Reduction in the carrying amount of right-of-use asset | 108 | 721 | ||||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | (305 | ) | 3,775 | |||||
Inventory | (2,446 | ) | 129 | |||||
Prepaid expenses and other current assets and deposits | 687 | (3,170 | ) | |||||
Increase (decrease) in: | ||||||||
Accounts payable | (1,332 | ) | 1,687 | |||||
Accrued expenses and other liabilities | (5,490 | ) | (5,473 | ) | ||||
Operating lease liability | 942 | (750 | ) | |||||
Net cash provided by (used in) operating activities | 19,489 | 20,478 | ||||||
Investing Activities: | ||||||||
Purchases of property and equipment | (912 | ) | — | |||||
Purchases of investments | (10,000 | ) | — | |||||
Proceeds from maturities and sales of investments | — | 5,000 | ||||||
Net cash provided by (used in) investing activities | (10,912 | ) | 5,000 | |||||
Financing Activities: | ||||||||
Payment of employee withholding tax related to stock-based compensation | (17 | ) | — | |||||
Proceeds from exercise of stock options | 459 | 62 | ||||||
Repurchase of common stock | (3,961 | ) | — | |||||
Net cash provided by (used in) financing activities | (3,519 | ) | 62 | |||||
Net increase (decrease) in cash and cash equivalents | 5,058 | 25,540 | ||||||
Cash and cash equivalents—beginning of period | 130,237 | 89,512 | ||||||
Cash and cash equivalents—end of period | $ | 135,295 | $ | 115,052 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Cash paid for income taxes | $ | 341 | $ | 50 | ||||
Non-cash investing and financing activities: | ||||||||
Unrealized gain (loss) on available-for-sale | $ | (68 | ) | $ | (11 | ) | ||
Operating lease liabilities arising from obtaining right-of-use | $ | 3,309 | $ | — |
For the Six Months Ended June 30, | ||||||||
2022 | 2021 | |||||||
Operating Activities: | ||||||||
Net income | $ | 34,860 | $ | 19,844 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 71 | 128 | ||||||
Stock-based compensation | 3,926 | 3,089 | ||||||
Deferred taxes | 2,718 | 4,270 | ||||||
Change in accrued interest and accretion of discount on investments | 9 | (6 | ) | |||||
Reduction in the carrying amount of right-of-use | 122 | 108 | ||||||
Realized loss on sale of available-for-sale | 633 | — | ||||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | (2,968 | ) | (305 | ) | ||||
Inventory | 20 | (2,446 | ) | |||||
Prepaid expenses and other current assets and deposits | 18 | 687 | ||||||
Increase (decrease) in: | ||||||||
Accounts payable | (453 | ) | (1,332 | ) | ||||
Accrued expenses and other liabilities | (4,137 | ) | (5,490 | ) | ||||
Operating lease liability | (150 | ) | 942 | |||||
Net cash provided by (used in) operating activities | 34,669 | 19,489 | ||||||
Investing Activities: | ||||||||
Purchases of property and equipment | (29 | ) | (912 | ) | ||||
Purchases of investments | — | (10,000 | ) | |||||
Proceeds from sale of available-for-sale | 9,370 | — | ||||||
Net cash provided by (used in) investing activities | 9,341 | (10,912 | ) | |||||
Financing Activities: | ||||||||
Payment of employee withholding tax related to stock-based compensation | (20 | ) | (17 | ) | ||||
Proceeds from exercise of stock options | 2,384 | 459 | ||||||
Repurchase of common stock | (6,907 | ) | (3,961 | ) | ||||
Net cash provided by (used in) financing activities | (4,543 | ) | (3,519 | ) | ||||
Net increase (decrease) in cash and cash equivalents | 39,467 | 5,058 | ||||||
Cash and cash equivalents – beginning of period | 171,445 | 130,237 | ||||||
Cash and cash equivalents – end of period | $ | 210,912 | $ | 135,295 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Cash paid for income taxes | $ | 5,844 | $ | 341 | ||||
Non-cash investing and financing activities: | ||||||||
Operating lease liabilities arising from obtaining right-of-use | $ | — | $ | 3,309 |
1. | Organization and Descriptionof Business. |
2. | Basis of Presentation and Significant Accounting Policies. |
a. | INTERIM FINANCIAL STATEMENTS. 10-Q was derived from the audited financial statements and does not include all disclosures required by U.S. GAAP. |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
b. | PRINCIPLES OF |
c. | USE OF ESTIMATES. |
d. | CASH AND CASH EQUIVALENTS. |
e. |
f. | ACCOUNTS RECEIVABLE, NET. |
2. | Basis of Presentation and SignificantAccounting Policies (continued). |
g. | work-in-process first-in, first out (FIFO) flow of goods. The Company began capitalizing inventories post FDA approval of ® on November 28, 2018 as the related costs were expected to be recoverable through the commercialization of the product. Costs incurred prior to the FDA approval of ® were recorded as research and development expenses in prior years’ consolidated statements of operations and comprehensive income. If information becomes available that suggests that inventories may not be realizable, the Company may be required to expense a portion or all of the previously capitalized inventories. |
h. | PREPAID EXPENSES AND OTHER CURRENT ASSETS. pre-clinical studies, clinical trials and studies, regulatory affairs and consulting. Prepaid manufacturing consists of advances for the Company’s drug manufacturing activities. Such advances are recorded as expense as the related goods are received or the related services are performed. |
i. | PROPERTY AND EQUIPMENT, NET. for computer equipment, from seven years for furniture and equipment, and from five to ten years for leasehold improvements. Expenditures for repairs and maintenance are charged to expenses as incurred.five to |
j. | FAIR VALUE OF FINANCIAL INSTRUMENTS. |
k. | FAIR VALUE MEASUREMENTS. |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
Fair Value Measurements at Reporting Date Using (in thousands) | ||||||||||||||||||||||||||||||||
Balances as of June 30, 2022 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||||||||||||||||||
Money market funds | $ | 15,009 | $ | 15,009 | $ | — | $ | — | ||||||||||||||||||||||||
U.S. Treasuries | $ | 176,699 | $ | 176,699 | $ | — | $ | — | ||||||||||||||||||||||||
Short-term investments: | ||||||||||||||||||||||||||||||||
Short-term bond fund | $ | 9,876 | $ | 9,876 | $ | — | $ | — | ||||||||||||||||||||||||
Fair Value Measurements at Reporting Date Using (in thousands) | ||||||||||||||||||||||||||||||||
Balances as of June 30, 2021 | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balances as of December 31, 2021 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||||||||||||||||||
Money market funds | $ | 68,663 | $ | 68,663 | $ | — | $ | — | $ | 10,990 | $ | 10,990 | $ | — | $ | — | ||||||||||||||||
U.S. Treasuries | $ | 49,996 | $ | 49,996 | $ | — | $ | — | $ | 140,995 | $ | 140,995 | $ | — | $ | — | ||||||||||||||||
Short-term investments: | ||||||||||||||||||||||||||||||||
Short-term bond funds | $ | 19,980 | $ | 19,980 | $ | — | $ | — | $ | 19,821 | $ | 19,821 | $ | — | $ | — | ||||||||||||||||
Balances as of December 31, 2020 | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||||||||
Cash and cash equivalents: | ||||||||||||||||||||||||||||||||
Money market funds | $ | 15,674 | $ | 15,674 | $ | — | $ | — | ||||||||||||||||||||||||
U.S. Treasuries | $ | 104,994 | $ | — | $ | 104,994 | $ | — | ||||||||||||||||||||||||
Short-term investments: | ||||||||||||||||||||||||||||||||
Short-term bond funds | $ | 10,041 | $ | 10,041 | $ | — | $ | — | ||||||||||||||||||||||||
OPERATING LEASES. right-of-use non-lease components, which are accounted for separately. |
SHARE REPURCHASES. |
REVENUE RECOGNITION. |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
2. | Basis of Presentationand Significant Accounting Policies (continued). |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
RESEARCH AND DEVELOPMENT. |
ADVERTISING EXPENSE. ® in 2019, the Company began to incur advertising costs. Advertising costs are expensed as incurred. The company incurred $0.8 million and $1.5 million in advertising costs during the three and six months ended June 30, 2022, respectively, and $0.5 million and $1.0 million during the three and six months ended June 30, 2021, respectively, which are included in selling, general and administrative expenses in the Company’s consolidated statement of operations and comprehensive income. |
q. | STOCK-BASED COMPENSATION. three years. Forfeitures are recognized as a reduction of stock-based compensation expense as they occur. |
CONCENTRATION OF RISK. |
s. | ROYALTIES. ® , as disclosed in Note 2 (Agreements), are expensed to cost of sales as revenue from product sales is recognized. |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
INCOMETAXES. |
COMPREHENSIVE INCOME. available-for-sale |
NET INCOME PER COMMON SHARE. |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Basic weighted average common shares outstanding | 103,407,803 | 103,414,523 | 103,610,138 | 103,410,881 | ||||||||||||
Effect of dilutive securities | 4,327,121 | 3,315,900 | 3,689,124 | 3,022,981 | ||||||||||||
Diluted weighted average common shares outstanding | 107,734,924 | 106,730,423 | 107,299,262 | 106,433,862 | ||||||||||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Basic weighted average common shares outstanding | 102,795,600 | 103,407,803 | 102,788,719 | 103,610,138 | ||||||||||||
Effect of dilutive securities | 6,469,130 | 4,327,121 | 6,360,466 | 3,689,124 | ||||||||||||
Diluted weighted average common shares outstanding | 109,264,730 | 107,734,924 | 109,149,185 | 107,299,262 | ||||||||||||
RECLASSIFICATIONS. |
RECENTLY ISSUED ACCOUNTING STANDARDS. |
3. | Investments. |
Estimated Fair Value | Gross Unrealized Gains | Gross Unrealized Losses | Amortized Cost | |||||||||||||
At June 30, 2021: | �� | |||||||||||||||
U.S. Treasuries – Cash equivalents | $ | 49,996 | $ | 0 | $ | (1 | ) | $ | 49,997 | |||||||
Short-term bond funds | 19,980 | — | (36 | ) | 20,016 | |||||||||||
Total | $ | 69,976 | $ | 0 | $ | (37 | ) | $ | 70,013 | |||||||
At December 31, 2020: | ||||||||||||||||
U.S. Treasuries – Cash equivalents | $ | 104,994 | $ | 2 | $ | — | $ | 104,992 | ||||||||
Short-term bond funds | 10,041 | 29 | — | 10,012 | ||||||||||||
Total | $ | 115,035 | $ | 31 | $ | — | $ | 115,004 | ||||||||
Estimated Fair Value | Gross Unrealized Gains | Gross Unrealized Losses | Amortized Cost | |||||||||||||
At June 30, 2022: | ||||||||||||||||
U.S. Treasuries - Cash equivalents | $ | 176,699 | $ | — | $ | (39 | ) | $ | 176,738 | |||||||
Short-term bond fund | 9,876 | — | (130 | ) | 10,006 | |||||||||||
Total | $ | 186,575 | $ | — | $ | (169 | ) | $ | 186,744 | |||||||
At December 31, 2021: | ||||||||||||||||
U.S. Treasuries - Cash equivalents | $ | 140,995 | $ | 2 | $ | — | $ | 140,993 | ||||||||
Short-term bond funds | 19,821 | — | (196 | ) | 20,017 | |||||||||||
Total | $ | 160,816 | $ | 2 | $ | (196 | ) | $ | 161,010 | |||||||
June 30, 2021 | ||||
Due in one year or less | $ | 69,976 |
June 30, 2022 | ||||
Due in one year or less | $ | 186,575 | ||
4. | Accumulated Other Comprehensive Income (Loss). |
Total Accumulated Other Comprehensive Income (Loss) | ||||
Balance at March 31, 2022 | $ | (453 | ) | |
Other comprehensive loss before reclassifications | (310 | ) | ||
Amount reclassified from accumulated other comprehensive income | 633 | |||
Net current period other comprehensive gain (loss) | 323 | |||
Balance at June 30, 2022 | $ | (130 | ) | |
Balance at December 31, 2021 | $ | (148 | ) | |
Other comprehensive loss before reclassifications | (615 | ) | ||
Amount reclassified from accumulated other comprehensive income | 633 | |||
Net current period other comprehensive gain (loss) | 18 | |||
Balance at June 30, 2022 | $ | (130 | ) | |
5. | Inventory. |
June 30, 2021 | December 31, 2020 | |||||||||||||||
June 30, 2022 | December 31, 2021 | |||||||||||||||
Raw materials | $ | 1,117 | $ | — | $ | — | $ | 1,769 | ||||||||
Work-in-process | 5,168 | 3,555 | 6,592 | 5,172 | ||||||||||||
Finished goods | 812 | 1,096 | 1,258 | 929 | ||||||||||||
Total inventory, net | $ | 7,097 | $ | 4,651 | ||||||||||||
Total inventory | $ | 7,850 | $ | 7,870 | ||||||||||||
6 . | Prepaid Expenses andOther Current Assets. |
June 30, 2021 | December 31, 2020 | |||||||||||||||
June 30, 2022 | December 31, 2021 | |||||||||||||||
Prepaid manufacturing costs | $ | 2,646 | $ | 3,328 | $ | 970 | $ | 307 | ||||||||
Prepaid tax | 93 | 1,368 | 96 | 564 | ||||||||||||
Prepaid insurance | 623 | 1,285 | 656 | 1,213 | ||||||||||||
Prepaid subscription fees | 530 | 729 | ||||||||||||||
Prepaid subscriptions fees | 697 | 909 | ||||||||||||||
Prepaid research fees | 391 | 453 | 185 | 452 | ||||||||||||
Prepaid commercialization expenses | 120 | 199 | 914 | 195 | ||||||||||||
Due from collaborative and licensing arrangements | 2,917 | 437 | 217 | 105 | ||||||||||||
Prepaid conference and travel expenses | 204 | 279 | ||||||||||||||
Other | 321 | 529 | 394 | 327 | ||||||||||||
Total prepaid expenses and other current assets | $ | 7,641 | $ | 8,328 | $ | 4,333 | $ | 4,351 | ||||||||
7 . | Operating Leases. |
For the three months ended June 30, 2021 | For the six months ended June 30, 2021 | |||||||
Operating lease cost | $ | 108 | $ | 164 |
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Operating lease cost | $ | 108 | $ | 108 | $ | 216 | $ | 164 |
June 30, 2021 | For the Six Months Ended June 30, | |||||||||||
2022 | 2021 | |||||||||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||||||||||
Operating cash flows | $ | 29 | $ | 245 | $ | 29 | ||||||
Right-of-use | ||||||||||||
Operating leases | $ | 36 | ||||||||||
Operating lease | $ | 45 | $ | 36 |
June 30, 2022 | December 31, 2021 | |||||||||||
Operating lease right-of-use | $ | 3,201 | $ | 2,895 | $ | 3,017 | ||||||
Other current liabilities | $ | 200 | $ | 322 | $ | 308 | ||||||
Operating lease liabilities, net of current portion | 4,051 | 3,729 | 3,894 | |||||||||
Total operating lease liabilities | $ | 4,251 | $ | 4,051 | $ | 4,202 | ||||||
Remaining lease term | 9.8 years | |||||||||||
Discount rate | 4.51 | % |
2021 (remaining six months) | $ | 80 | ||||||
2022 | 492 | |||||||
2022 (remaining six months) | $ | 246 | ||||||
2023 | 506 | 506 | ||||||
2024 | 522 | 522 | ||||||
2025 | 537 | 537 | ||||||
2026 | 553 | |||||||
Thereafter | 3,150 | 2,598 | ||||||
Total lease payments | 5,287 | 4,962 | ||||||
Less imputed interest | (1,036 | ) | ||||||
Less: imputed interest | (911 | ) | ||||||
Total | $ | 4,251 | $ | 4,051 | ||||
8 . | Property and Equipment, Net. |
June 30, 2021 | December 31, 2020 | |||||||
Computer equipment | $ | 51 | $ | 51 | ||||
Furniture and equipment | 135 | 242 | ||||||
Leasehold improvements | 939 | 177 | ||||||
Less: Accumulated depreciation | (211 | ) | (340 | ) | ||||
Total property and equipment, net | $ | $ | 130 | |||||
June 30, 2022 | December 31, 2021 | |||||||
Computer equipment | $ | 51 | $ | 51 | ||||
Furniture and equipment | 223 | 203 | ||||||
Leasehold improvements | 980 | 980 | ||||||
Less: Accumulated depreciation | (337 | ) | (275 | ) | ||||
Total property and equipment, net | $ | 917 | $ | 959 | ||||
9 . | Accrued Expenses and Other Liabilities. |
June 30, 2021 | December 31, 2020 | |||||||
Accrued preclinical and clinical trial expenses | $ | 530 | $ | 585 | ||||
Accrued professional fees | 1,229 | 1,884 | ||||||
Accrued compensation and benefits | 2,014 | 3,991 | ||||||
Accrued license fees | 6,382 | 10,373 | ||||||
Accrued purchases | 1,343 | 258 | ||||||
Accrued contributions | — | 310 | ||||||
Operating lease liability | 200 | 29 | ||||||
Accrued variable consideration | 1,331 | 964 | ||||||
Accrued income tax | 70 | — | ||||||
Other | 112 | 106 | ||||||
Current accrued expenses and other liabilities | 13,211 | 18,500 | ||||||
Lease liability—non-current | 4,051 | — | ||||||
Non-current accrued expenses and other liabilities | 4,051 | — | ||||||
Total accrued expenses and other liabilities | $ | 17,262 | $ | 18,500 | ||||
June 30, 2022 | December 31, 2021 | |||||||
Accrued preclinical and clinical trial expenses | $ | 319 | $ | 659 | ||||
Accrued professional fees | 1,533 | 2,391 | ||||||
Accrued compensation and benefits | 2,853 | 4,035 | ||||||
Accrued license fees | 9,923 | 12,819 | ||||||
Accrued purchases | 525 | 2,045 | ||||||
Operating lease liability | 322 | 308 | ||||||
Accrued variable consideration | 2,613 | 1,716 | ||||||
Accrued income tax | 1,855 | 79 | ||||||
Other | 230 | 243 | ||||||
Current accrued expenses and other liabilities | 20,173 | 24,295 | ||||||
Lease liability – non-current | 3,729 | 3,894 | ||||||
Non-current accrued expenses and other liabilities | 3,729 | 3,894 | ||||||
Total accrued expenses and other liabilities | $ | 23,902 | $ | 28,189 | ||||
10 . |
1 .0 | Collaborative and Licensing Arrangements (continued). |
10 . | Collaborative and Licensing Arrangements (continued). |
1 . | Commitments and Contingencies. |
1 . | Commitments andContingencies (continued). |
2 . | Agreements. |
a. | LICENSE AGREEMENT FOR FIRDAPSE ® .On ® . Under the license agreement, the Company pays: (i) royalties to the licensor for seven years from the first commercial sale of ® equal to 7% of net sales (as defined in the license agreement) in North America for any calendar year for sales up to $100 million, and 10% of net sales in North America in any calendar year in excess of $100 million; and (ii) royalties to the third-party licensor of the rights sublicensed to the Company for seven years from the first commercial sale of ® equal to 7% of net sales (as defined in the license agreement between BioMarin and the third-party licensor) in any calendar year for the duration of any regulatory exclusivity within a territory and 3.5% for territories in any calendar year in territories without regulatory exclusivity. |
1 2 . | Agreements (continued). |
b. | AGREEMENTS FOR DRUG MANUFACTURING, DEVELOPMENT, PRECLINICAL AND CLINICAL STUDIES. |
1 | Income Taxes. |
4 . | Stockholders’ Equity. |
5 . | Stock Compensation. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Research and development | $ | 376 | $ | 421 | $ | 765 | $ | 839 | ||||||||
Selling, general and administrative | 1,142 | 1,373 | 2,324 | 2,475 | ||||||||||||
Total stock-based compensation | $ | 1,518 | $ | 1,794 | $ | 3,089 | $ | 3,314 | ||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Research and development | $ | 425 | $ | 376 | $ | 857 | $ | 765 | ||||||||
Selling, general and administrative | 1,598 | 1,142 | 3,069 | 2,324 | ||||||||||||
Total stock-based compensation | $ | 2,023 | $ | 1,518 | $ | 3,926 | $ | 3,089 | ||||||||
6 . | SubsequentEvents. |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Three months ended June 30, | Change | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Research and development expenses | $ | 4,074 | $ | 3,929 | 145 | 3.7 | % | |||||||||
Employee stock-based compensation | 376 | 421 | (45 | ) | (10.7 | )% | ||||||||||
Total research and development expenses | $ | 4,450 | $ | 4,350 | 100 | 2.3 | % | |||||||||
Six months ended June 30, | Change | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Research and development expenses | $ | 6,692 | $ | 7,734 | (1,042 | ) | (13.5 | )% | ||||||||
Employee stock-based compensation | 765 | 839 | (74 | ) | (8.8 | )% | ||||||||||
Total research and development expenses | $ | 7,457 | $ | 8,573 | (1,116 | ) | (13.0 | )% | ||||||||
Three months ended June 30, | Change | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Selling | $ | 5,981 | $ | 5,622 | 359 | 6.4 | % | |||||||||
General and administrative | 4,409 | 3,838 | 571 | 14.9 | % | |||||||||||
Employee stock-based compensation | 1,142 | 1,373 | (231 | ) | (16.8 | )% | ||||||||||
Total selling, general and administrative expenses | $ | 11,532 | $ | 10,833 | 699 | 6.5 | % | |||||||||
Six months ended June 30, | Change | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Selling | $ | 11,657 | $ | 11,425 | 232 | 2.0 | % | |||||||||
General and administrative | 10,267 | 6,996 | 3,271 | 46.8 | % | |||||||||||
Employee stock-based compensation | 2,324 | 2,475 | (151 | ) | (6.1 | )% | ||||||||||
Total selling, general and administrative expenses | $ | 24,248 | $ | 20,896 | 3,352 | 16.0 | % | |||||||||
Three months ended June 30, | Change | |||||||||||||||
2022 | 2021 | $ | % | |||||||||||||
Research and development expenses | $ | 3,558 | $ | 4,074 | (516 | ) | (12.7 | ) | ||||||||
Employee stock-based compensation | 425 | 376 | 49 | 13.0 | ||||||||||||
Total research and development expenses | $ | 3,983 | $ | 4,450 | (467 | ) | (10.5 | ) | ||||||||
Six months ended June 30, | Change | |||||||||||||||
2022 | 2021 | $ | % | |||||||||||||
Research and development expenses | $ | 6,529 | $ | 6,692 | (163 | ) | (2.4 | ) | ||||||||
Employee stock-based compensation | 857 | 765 | 92 | 12.0 | ||||||||||||
Total research and development expenses | $ | 7,386 | $ | 7,457 | (71 | ) | (1.0 | ) | ||||||||
Three months ended June 30, | Change | |||||||||||||||
2022 | 2021 | $ | % | |||||||||||||
Selling | $ | 7,268 | $ | 5,981 | 1,287 | 21.5 | ||||||||||
General and administrative | 4,052 | 4,409 | (357 | ) | (8.1 | ) | ||||||||||
Employee stock-based compensation | 1,598 | 1,142 | 456 | 39.9 | ||||||||||||
Total selling, general and administrative expenses | $ | 12,918 | $ | 11,532 | 1,386 | 12.0 | ||||||||||
Six months ended June 30, | Change | |||||||||||||||
2022 | 2021 | $ | % | |||||||||||||
Selling | $ | 14,058 | $ | 11,657 | 2,401 | 20.6 | ||||||||||
General and administrative | 12,221 | 10,267 | 1,954 | 19.0 | ||||||||||||
Employee stock-based compensation | 3,069 | 2,324 | 745 | 32.1 | ||||||||||||
Total selling, general and administrative expenses | $ | 29,348 | $ | 24,248 | 5,100 | 21.0 | ||||||||||
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
a. | We have carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, Rules 13a-15(e) and15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on such evaluation, our principal executive officer and principal financial officer have concluded that as of June 30, |
b. | During the three months ended June 30, |
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program | Dollar Value of Shares that May Yet Be Purchased (in thousands) | ||||||||||||
April 1, 2021 – April 30, 2021 | 432,951 | $ | 4.53 | 432,951 | $ | 37,748 | ||||||||||
May 1, 2021 – May 31, 2021 | 9,260 | $ | 4.62 | 9,260 | $ | 37,705 | ||||||||||
June 1, 2021 – June 30, 2021 | 290,740 | $ | 5.73 | 290,740 | $ | 36,040 |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program | Dollar Value of Shares that May Yet Be Purchased (in thousands) | ||||||||||||
April 1, 2022 – April 30, 2022 | 200,000 | $ | 7.97 | 200,000 | $ | 23,767 | ||||||||||
May 1, 2022 – May 31, 2022 | 62,591 | $ | 6.82 | 62,591 | $ | 23,341 | ||||||||||
June 1, 2022 – June 30, 2022 | 337,409 | $ | 6.93 | 337,409 | $ | 21,003 |
39 | ITEM 3. DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. MINE SAFETY DISCLOSURE |
ITEM 5. OTHER INFORMATION |
ITEM 6. EXHIBITS |
31.1 | Certification of Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification of Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 | Certification of Principal Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 | Certification of Principal Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS | Inline XBRL Instance Document | |
101.SCH | Inline XBRL Taxonomy Extension Schema | |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
Catalyst Pharmaceuticals, Inc. | ||
By: | /s/ Alicia Grande | |
Alicia Grande | ||
Vice President, Treasurer and Chief Financial Officer |