On November 1, 2018 Pacira Pharmaceuticals, Inc. (NASDAQ: PCRX) reported consolidated financial results for the third quarter ended September 30, 2018 (Press release, Pacira Pharmaceuticals, NOV 1, 2018, View Source;p=irol-newsArticle&ID=2374725 [SID1234530546]).
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"As evident from these financial results, EXPAREL continues to deliver impressive sales growth with physicians having great success delivering targeted, long-acting, opioid-free local or regional analgesia for postsurgical pain in a variety of procedures," said Dave Stack, chairman and chief executive officer of Pacira Pharmaceuticals. "Specifically we are seeing great enthusiasm around the use of EXPAREL as a brachial plexus nerve block and an increasing number of anesthesiologists incorporating EXPAREL into their suite of postsurgical pain solutions by expanding its use in newer regional anesthesia techniques, such as transverse abdominis, pectoralis and fascial iliaca plane blocks. In addition, our highly successful partnership with Johnson & Johnson remains a key growth driver as we integrate EXPAREL into multiple joint marketing programs, including a new initiative that will feature EXPAREL and TYLENOL as a platform for opioid-free postsurgical pain relief. Overall we are very pleased to be increasing our financial guidance for the second time this year."
"Looking forward we expect various initiatives to expand access to EXPAREL, particularly the assignment of new ambulatory care and dental reimbursement codes at the beginning of 2019, as well as increasing public and private payer recognition of the need for non-opioid pain relief following surgery."
Third Quarter 2018 Financial Results
EXPAREL net product sales were $82.2 million in the third quarter of 2018, a 23% increase over the $66.8 million reported for the third quarter of 2017.
Total operating expenses were $79.4 million in the third quarter of 2018, compared to $70.9 million in the third quarter of 2017.
GAAP net loss was $0.6 million, or $(0.02) per share (basic and diluted), in the third quarter of 2018, compared to a GAAP net loss of $7.6 million, or $(0.19) per share (basic and diluted), in the third quarter of 2017.
Non-GAAP net income was $12.8 million, or $0.31 per share (basic and diluted) in the third quarter of 2018, compared to non-GAAP net income of $4.4 million, or $0.11 per share (basic and diluted) in the third quarter of 2017.
Pacira ended the third quarter of 2018 with cash, cash equivalents and short-term investments ("cash") of $386.4 million.
Pacira had 41.0 million basic weighted average shares of common stock outstanding in the third quarter of 2018.
Pacira had 42.0 million diluted weighted average shares of common stock outstanding in the third quarter of 2018.
2018 Financial Guidance
Today, the company is increasing its full-year 2018 guidance for EXPAREL net product sales and improving its guidance for non-GAAP gross margins. The remainder of the company’s guidance remains unchanged from the ranges previously provided in August 2018. A summary of Pacira’s full-year 2018 financial guidance is outlined below.
EXPAREL net product sales of $325 million to $330 million.
Non-GAAP gross margins of 74% to 75%.
Non-GAAP research and development (R&D) expense of $50 million to $60 million.
Non-GAAP selling, general and administrative (SG&A) expense of $150 million to $160 million.
Stock-based compensation of $30 million to $35 million.
See "Non-GAAP Financial Information" and "Reconciliations of GAAP to Non-GAAP 2018 Financial Guidance" below.
Today’s Conference Call and Webcast Reminder
The Pacira management team will host a conference call to discuss the company’s financial results and recent developments today, Thursday, November 1, at 8:30 a.m. ET. To participate in the conference call, dial 1-877-845-0779 and provide the passcode 1988603. International callers may dial 1-720-545-0035 and use the same passcode. In addition, a live audio of the conference call will be available as a webcast. Interested parties can access the event through the "Events" page on the Pacira website at investor.pacira.com.
For those unable to participate in the live call, a replay will be available at 1-855-859-2056 (domestic) or 1-404-537-3406 (international) using the passcode 1988603. The replay of the call will be available for one week from the date of the live call. The webcast will be available on the Pacira website for approximately two weeks following the call.
Non-GAAP Financial Information
This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), such as non-GAAP net income (loss), non-GAAP net income (loss) per share, non-GAAP cost of goods sold, non-GAAP gross margins, non-GAAP research and development (R&D) expense and non-GAAP selling, general and administrative (SG&A) expense, because such measures exclude milestone revenue, stock-based compensation, amortization of debt discount, loss on early extinguishment of debt, exit costs related to the discontinuation of DepoCyt(e) production and loss on an unexercised investment purchase option.
These measures supplement the company’s financial results prepared in accordance with GAAP. Pacira management uses these measures to better analyze its financial results, estimate its future cost of goods sold, gross margins, R&D expense and SG&A expense outlook for 2018 and to help make managerial decisions. In management’s opinion, these non-GAAP measures are useful to investors and other users of our financial statements by providing greater transparency into the operating performance at Pacira and the company’s future outlook. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. Non-GAAP measures are also unlikely to be comparable with non-GAAP disclosures released by other companies. See the tables below for a reconciliation of GAAP to non-GAAP measures, and a reconciliation of our GAAP to non-GAAP 2018 financial guidance for gross margins, R&D expense and SG&A expense.