On May 9, 2016 Eagle Pharmaceuticals, Inc. ("Eagle" or "the Company") (Nasdaq: EGRX) reported its financial results for the first quarter ended March 31, 2016 (Press release, Eagle Pharmaceuticals, MAY 9, 2016, View Source [SID:1234512110]). Highlights of and subsequent to the first quarter of 2016 include:

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Business Highlights:

Bendeka was launched January 28, 2016 by Eagle’s marketing partner, Teva Pharmaceutical Industries (Teva); total market share, as of May 6, 2016, was 71% and 77% in core hospital outpatient and clinic segments combined (representing 70% of the total market);
Eagle entered into an agreement with the National Institutes of Health (NIH)/National Institute on Drug Abuse (NIDA) to explore the use of Ryanodex in the treatment of hyperthermia related to MDMA (Ecstasy) and Methamphetamine intoxication;
Eagle entered into an agreement to divest diclofenac-misoprostsol to a third party in exchange for $1.75 million and a 25% royalty on net profits for five years; and,
Eagle completed its first quarter with an internal salesforce fully focused on commercialization of Eagle’s in-market products.
Financial Highlights:

Total revenue was $29.6 million during the first quarter of 2016 compared to $36.3 million for the three months ended March 31, 2015;
Product sales increased to $14.1 million during the first quarter of 2016 compared to $3.1 million for the three months ended March 31, 2015;
Sales of Ryanodex grew 5% quarter over quarter to $1.9 million during the first quarter of 2016;
Net loss was $896,000, or $0.06 per basic and diluted share, compared to net income of $19.7 million, or $1.38 per basic and $1.31 per diluted share, for the three months ended March 31, 2016 and 2015, respectively; and,
Cash and cash equivalents were $78.3 million as of March 31, 2016.
"Our business outlook for the Company remains bright. Our bendamustine product family offers significant opportunity for growth and is being accepted well by physicians and patients. Assuming bendamustine generics do not come to market, and with Bendeka gaining momentum, based on its product profile which customers seem to prefer, we believe Bendeka is on track to reach Teva’s and our shared goal of 90% market share or greater and will be an important earnings driver for Eagle for years to come," said Scott Tarriff, President and Chief Executive Officer of Eagle Pharmaceuticals.

"In addition to our other product candidates, we believe Ryanodex has the potential for multiple additional clinical indications. These opportunities in treating exertional heat stroke and ecstasy and methamphetamine intoxication, if approved, would open up significant new markets for the product. We are encouraged by the potential of our products to deliver solutions that address life-threatening conditions and improve treatment outcomes and look forward to upcoming milestones that we expect will drive meaningful earnings growth," concluded Tarriff.

First Quarter 2016 Financial Results

Total revenue for the three months ended March 31, 2016 was $29.6 million, as compared to $36.3 million for the three months ended March 31, 2015. A summary of total revenue is outlined below:

Three Months Ended
March 31, Increase/(Decrease)
2016 2015
(in thousands)
Product sales $ 14,122 $ 3,056 $ 11,066
Royalty income 9,469 3,253 6,216
License and other income 6,000 30,000 (24,000 )
Total revenue $ 29,591 $ 36,309 $ (6,718 )

Product sales increased $11.1 million to $14.1 million in the first quarter of 2016 driven by $10.3 million in net product sales of Bendeka, 5% growth in Ryanodex net product sales to $1.9 million, $0.9 million in net sales of Docetaxel and increases in net sales of Diclofenac-misoprostol, offset by a decrease in Argatroban product sales to our commercial partners.

The $6.2 million increase in royalty income to $9.5 million was driven by the launch of Bendeka during the first quarter of 2016.

License and other income in the three months ended March 31, 2016 was $6 million compared with $30 million in the prior year quarter. This $6 million reflects revenue previously deferred from the 2010 sale of a non-core asset subject to a claw back provision, which has now expired.

Cost of revenue increased by $8.6 million to $14.5 million in the three months ended March 31, 2016 from $5.9 million in the three months ended March 31, 2015. This $8.6 million net increase resulted primarily from the cost of Bendeka product sales, Docetaxel and Diclofenac-misoprostol, offset by a decrease in cost of revenue for Ryanodex due to spoiled inventory, and lower Argatroban product sales.

Research and development expenses increased by $0.4 million to $6.7 million in the three months ended March 31, 2016, compared to $6.3 million in the prior year quarter. The increase is due primarily to the successful completion of the clinical treatment portion of the safety and efficacy study of Ryanodex for exertional heatstroke, investment in Kangio and other pipeline products, and higher R&D personnel costs offset by a decrease in spending related to bendamustine.

SG&A expenses were $11 million in the first quarter of 2016 compared to $4 million in the three months ended March 31, 2015. Personnel-related expenses accounted for the bulk of the $7 million increase and were due to overall expansion of the business.

Net loss for the first quarter was $896,000, or $0.06 per basic share and diluted share, compared to a net income of $19.7 million, or $1.38 per basic and $1.31 per diluted share in the three months ended March 31, 2015, as a result of the factors discussed above.

Liquidity

As of March 31, 2016, the Company had $78.3 million in cash and cash equivalents; $15 million in receivables due from Teva; $200.3 million in additional paid in ca