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Avanir Pharmaceuticals Reports Fiscal 2012 Fourth Quarter And Year-End Financial And Business Results

December 12, 2012

ALISO VIEJO, Calif., Dec. 12, 2012 /PRNewswire/ – Avanir Pharmaceuticals, Inc. (NASDAQ: AVNR) today reported financial results for the three and twelve months ended September 30, 2012.

Quarterly Financial Highlights

  • Gross and net NUEDEXTA® sales of $15.4 million and $12.4 million, respectively, an increase of 26% and 23% versus the previous quarter
  • Total company net revenue of $13.5 million
  • Cash, cash equivalents, and restricted investments of $72.1 million as of September 30, 2012

“Our business has very good momentum as we are executing our strategy to grow revenues and deliver much needed therapies to patients. In addition to growing the PBA franchise, we are investing in our pipeline to develop several breakthrough therapies for the future, which are important steps to becoming a leading mid-cap CNS company. The clinical trials are continuing to enroll, and investments in R&D should, if successful, result in value generating inflection points in the coming years,” said Keith A. Katkin, president and CEO of Avanir.

Fiscal 2012 Fourth Quarter Results

  • Total net revenue for the quarter ended September 30, 2012 were $13.5 million, compared with $4.8 million for the comparable quarter in 2011; total net revenues consist of NUEDEXTA net revenue and royalty revenue from Abreva®
  • Total operating expenses were $24.2 million in the fourth quarter of fiscal 2012, compared with $22.7 million in the comparable period in fiscal 2011
  • Cash used in operations was $12.1 million in the fourth quarter of fiscal 2012
  • Net loss for the fiscal 2012 fourth quarter was $11.7 million, or $0.09 per share, compared with a net loss of $18.0 million, or $0.14 per share, for the same period in fiscal 2011

Twelve-Month Results

  • Total revenues for fiscal 2012 were $41.3 million, compared with $10.5 million for fiscal 2011
  • Total operating expenses for fiscal 2012, excluding cost of sales and share-based compensation, were $92.7 million; total operating expenses were $99.7 million for fiscal 2012
  • Cash used in operations was $57.7 million in fiscal 2012
  • Net loss for fiscal 2012 was $59.7 million, or $0.45 net loss per share, compared with a net loss of $60.6 million, or $0.51 net loss per share for fiscal 2011

Cash, Cash Equivalents & Marketable Securities
As of September 30, 2012 Avanir had cash, cash equivalents and investments in securities totaling $72.1 million, including cash and cash equivalents of $69.8 million and restricted investments in securities of $2.3 million.

Business Highlights
Recent highlights for the company include:

  • Achieved record NUEDEXTA prescriptions of 31,018 for the quarter ended September 30, 2012.
  • On September 4, 2012, the company announced the enrollment of the first patient in study AVR-131. The study is a Phase II clinical trial investigating the use of AVP-923 for the treatment of agitation in patients with Alzheimer’s disease.
  • In the fourth quarter of fiscal 2012 the company completed a sales force expansion and realignment bringing the total number of sales representatives to 130.
  • On October 23, 2012, the company announced that The Michael J. Fox Foundation had awarded the company a grant to evaluate the safety and efficacy of AVP-923 (dextromethorphan hydrobromide and quinidine sulfate) for the treatment of levodopa-induced-dyskinesia (LID) in Parkinson’s disease (PD).
  • In November 2012, we initiated the first-in-human Phase I clinical trial of AVP-786 (formerly known as deuterated dextromethorphan). The trial is designed to assess the single and multiple dose pharmacokinetics, safety and tolerability of AVP-786 administered to healthy subjects.

Note to Investors: As previously announced, Avanir will hold a conference call to discuss fiscal 2012 fourth quarter and year-end financial results today, December 12, 2012, beginning at 1:30 p.m. Pacific Time. You can listen to this call by dialing 1 (866) 314-5050 for domestic callers or +1 (617) 213-8051 for international callers, and entering passcode 16033129. Those interested in listening to the conference call live via the Internet may do so by visiting http://ir.avanir.com.

About NUEDEXTA
NUEDEXTA is an innovative combination of two well-characterized components; dextromethorphan hydrobromide (20 mg), the ingredient active in the central nervous system, and quinidine sulfate (10 mg), a metabolic inhibitor enabling therapeutic dextromethorphan concentrations. NUEDEXTA acts on sigma-1 and NMDA receptors in the brain, although the mechanism by which NUEDEXTA exerts therapeutic effects in patients with PBA is unknown.

NUEDEXTA Important Safety Information
NUEDEXTA is indicated for the treatment of pseudobulbar affect (PBA). PBA occurs secondary to a variety of otherwise unrelated neurological conditions, and is characterized by involuntary, sudden, and frequent episodes of laughing and/or crying. PBA episodes typically occur out of proportion or incongruent to the underlying emotional state.

Studies to support the effectiveness of NUEDEXTA were performed in patients with amyotrophic lateral sclerosis (ALS) and multiple sclerosis (MS). NUEDEXTA has not been shown to be safe and effective in other types of emotional lability that can commonly occur, for example, in Alzheimer’s disease and other dementias.

NUEDEXTA (dextromethorphan hydrobromide and quinidine sulfate) 20/10 mg capsules can interact with other medications causing significant changes in blood levels of those medications and/or NUEDEXTA which may lead to serious side effects. Adjust dose or use alternate treatment of the other medication when clinically indicated.

NUEDEXTA is contraindicated in patients concomitantly taking: QT-prolonging drugs metabolized by CYP2D6 (e.g., thioridazine and pimozide); monoamine oxidase inhibitors (MAOIs) within the preceding or following 14 days; other drugs containing quinidine, quinine, or mefloquine and in patients with a known hypersensitivity to these drugs or any of NUEDEXTA’s components. Discontinue use of NUEDEXTA if hepatitis, thrombocytopenia, serotonin syndrome or a hypersensitivity reaction occurs.

NUEDEXTA is contraindicated in patients with certain risk factors for arrhythmia: Prolonged QT interval; congenital long QT syndrome, history suggestive of torsades de pointes; heart failure; complete atrioventricular (AV) block or risk of AV block without an implanted pacemaker.

NUEDEXTA causes dose-dependent QTc prolongation. When initiating NUEDEXTA in patients at risk for QT prolongation and torsades de pointes, electrocardiographic (ECG) evaluation should be conducted at baseline and 3-4 hours after the first dose. Risk factors include left ventricular hypertrophy or dystrophy or concomitant use of drugs that prolong QT interval or certain CYP3A4 inhibitors.

The most common adverse reactions are diarrhea, dizziness, cough, vomiting, asthenia, peripheral edema, urinary tract infection, influenza, increased gamma-glutamyltransferase, and flatulence. NUEDEXTA may cause dizziness. Precautions to reduce the risk of falls should be taken, particularly for patients with motor impairment affecting gait or a history of falls.

These are not all the risks from use of NUEDEXTA. Please refer to the accompanying full Prescribing Information or visit www.NUEDEXTA.com.

About Avanir Pharmaceuticals, Inc.
Avanir Pharmaceuticals, Inc. is a biopharmaceutical company focused on bringing innovative medicines to patients with central nervous system disorders of high unmet medical need. As part of our commitment, we have extensively invested in our pipeline and are dedicated to advancing medicines that can substantially improve the lives of patients and their loved ones. For more information about Avanir, please visit www.avanir.com.

Avanir® and NUEDEXTA® are registered trademarks owned by Avanir Pharmaceuticals, Inc. All other trademarks are the property of their respective owners.

(©)2012 Avanir Pharmaceuticals, Inc. All Rights Reserved.

Forward Looking Statements
Except for the historical information contained herein, the matters set forth in this press release, including statements regarding Avanir’s plans, potential opportunities, financial or other expectations, projections, goals objectives, milestones, strategies, market growth, timelines, legal matters, product pipeline, clinical studies, product development and the potential benefits of its commercialized products and products under development are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including the risks and uncertainties associated with Avanir’s operating performance and financial position, the market demand for and acceptance of Avanir’s products domestically and internationally, research, development and commercialization of new products domestically and internationally, obtaining additional indications for commercially marketed products domestically and internationally, obtaining and maintaining regulatory approvals domestically and internationally, and other risks detailed from time to time in the Company’s most recent Annual Report on Form 10-K and other documents subsequently filed with or furnished to the Securities and Exchange Commission. These forward-looking statements are based on current information that may change and you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update any forward-looking statement to reflect events or circumstances after the issuance of this press release.

Avanir Investor & Media Contact
Ian Clements, PhD
ir@avanir.com
+1 (949) 389-6700

                                              AVANIR PHARMACEUTICALS, INC.
                                         CONDENSED CONSOLIDATED BALANCE SHEETS

                                                    September 30,              September 30,
                                                                        2012                       2011
                                                                        ----                       ----
                                                     (unaudited)                 (audited)
                                                         ASSETS
    Current assets:
         Cash and cash equivalents                               $69,778,406                $79,542,564
         Trade receivables, net                                    7,231,759                  2,011,165
         Inventories, net                                            415,475                    252,244
         Prepaid expenses and other
          current assets                                           2,434,590                  1,965,748
         Current portion of restricted
          investments in marketable
          securities                                               1,054,463                    618,314
                                                                   ---------                    -------
              Total current assets                                80,914,693                 84,390,035
    Restricted investments in
     marketable securities, net of
     current portion                                               1,302,136                  1,634,625
    Property and equipment, net                                    1,808,594                  1,695,329
    Non-current inventories, net                                     908,364                    792,933
    Other assets                                                   1,078,009                  1,136,072
                                                                   ---------                  ---------
           TOTAL ASSETS                                          $86,011,796                $89,648,994
                                                                 ===========                ===========

                                        LIABILITIES AND STOCKHOLDERS' EQUITY
    Current liabilities:
        Accounts payable, accrued
         expenses and other
         liabilities                                             $15,598,666                $10,449,427
        Deferred product revenues, net                                     -                  1,652,788
        Current portion of note payble                             2,162,263                          -
        Current portion of deferred
         royalty revenues                                          2,557,464                  2,087,226
                                                                   ---------                  ---------
           Total current liabilities                              20,318,393                 14,189,441
    Accrued expenses and other
     liabilities, net of current
     portion                                                         666,179                     68,487
    Note Payable                                                  26,698,263                          -
    Deferred royalty revenues, net
     of current portion                                            1,491,854                  4,051,402
            Total liabilities                                     49,174,689                 18,309,330
                                                                  ----------                 ----------
             Total stockholders' equity                           36,837,107                 71,339,664
                                                                  ----------                 ----------
    TOTAL LIABILITIES AND
     STOCKHOLDERS'  EQUITY                                       $86,011,796                $89,648,994
                                                                 ===========                ===========

                                                                                    AVANIR PHARMACEUTICALS, INC.
                                                                                  CONDENSED STATEMENT OF OPERATIONS

                                        Three Months Ended September 30,    Twelve Months Ended September 30,
                                        --------------------------------    ---------------------------------
                                                                      2012                                 2011             2012          2011
                                                                      ----                                 ----             ----          ----
    REVENUES AND COSTS FROM
     PRODUCT SALES
       Gross product sales                                     $15,431,249                           $4,322,688      $45,107,989    $7,014,778
       Less: discounts and
        allowances                                               3,037,891                              627,631        8,033,422       925,472
       Net product sales                                        12,393,358                            3,695,057       37,074,567     6,089,306
       Revenues from royalties                                   1,138,448                            1,065,713        4,200,506     4,406,589
                                                                 ---------                            ---------        ---------     ---------
               Total revenues                                   13,531,806                            4,760,770       41,275,073    10,495,895
                                                                ----------                            ---------       ----------    ----------

    OPERATING EXPENSES
       Cost of product sales                                       712,546                              212,445        2,120,221       445,980
       Research and development                                  6,095,161                            5,631,610       23,066,037    15,253,739
       Selling, general and
        administrative                                          17,399,704                           16,903,327       74,490,996    55,425,591
               Total operating expenses                         24,207,411                           22,747,382       99,677,254    71,125,310
                                                                ----------                           ----------       ----------    ----------

    Loss from operations                                       (10,675,605)                         (17,986,612)     (58,402,181)  (60,629,415)

    OTHER INCOME (EXPENSE)
       Interest income                                              12,752                               10,754           42,815        38,785
       Interest expense                                         (1,059,244)                                           (1,385,342)
       Other, net                                                        -                               (9,438)           4,081       (37,733)
                                                                       ---                               ------            -----       -------

    Loss before provision for
     income taxes                                              (11,722,097)                         (17,985,296)     (59,740,627)  (60,628,363)

       Provision for income
        taxes                                                        3,200                                3,200            3,200         3,200
                                                                     -----                                -----            -----         -----

    Net loss and
     comprehensive loss                                       $(11,725,297)                        $(17,988,496)    $(59,743,827) $(60,631,563)
                                                              ============                         ============     ============  ============

    Basic and diluted net
     loss per share                                                 $(0.09)                              $(0.14)          $(0.45)       $(0.51)
                                                                    ======                               ======           ======        ======

    Basic and diluted
     weighted average number
     of common shares
     outstanding                                               136,239,668                          124,325,299      133,358,571   119,405,230
                                                               ===========                          ===========      ===========   ===========

SOURCE Avanir Pharmaceuticals, Inc.


Source: PR Newswire