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Cumberland Pharmaceuticals Reports 2013 Fourth Quarter And Annual Financial Results

- Acquired Vaprisol® from Astellas Pharma US, Inc.

NASHVILLE, Tenn., March 4, 2014 /PRNewswire/ -- Cumberland Pharmaceuticals Inc. (NASDAQ: CPIX), a specialty pharmaceutical company focused on hospital acute care and gastroenterology, today announced fourth quarter and annual 2013 financial results. The Company also recently announced the acquisition of Vaprisol, a marketed critical care product from Astellas Pharma US, Inc.

Net Revenue:  For the three months ended December 31, 2013, net revenue was $8.2 million, compared to $13.7 million for the prior year period.  Net revenue was $3.7 million for Acetadote® including $2.2 million from our authorized generic, $2.8 million for Kristalose®, $0.6 million for Caldolor®, and $1.0 million for our new product, Omeclamox®-Pak.

For the year ended December 31, 2013, net revenues were $32.0 million, compared with $48.9 million for 2012.

Operating Expenses:  Total operating expenses for the three months ended December 31, 2013 were $10.6 million compared to $10.4 million the prior year period.

For the year ended December 31, 2013, total operating expenses were approximately $35.8 million compared with $40.0 million for 2012.

Net (Loss) Income:  Net (loss) income attributable to common shareholders for the three months ended December 31, 2013 was a net loss of $1.5 million, or $(0.08) per diluted share, compared to net income of $1.8 million, or $0.09 per diluted share, for the same period in 2012.

Net (loss) income attributable to common shareholders for the year ended December 31, 2013 was a net loss of $2.1 million, or $(0.11) per diluted share, compared to net income of $5.8 million, or $0.30 per diluted share, for 2012.

Balance Sheet:  As of December 31, 2013, cash and marketable securities were $54.9 million, compared to $71.0 million at the end of the prior year. Total assets at December 31, 2013, were $87.6 million compared to $98.6 million at the end of 2012. As of December 31, 2013, the revolving line of credit had been fully paid compared to our balance of $4.4 million at the end of 2012.

"The Company encountered new challenges in 2013 and I am pleased to report that our team rose to the occasion," said A.J. Kazimi, Chief Executive Officer of Cumberland Pharmaceuticals. "Our strategic theme for 2014 is to continue to build a diversified specialty product portfolio while deploying our resources to sustain long-term profitability. We will continue to focus on our mission of improving patient care through the delivery of high quality pharmaceutical products."

Product Highlights

Vaprisol®

Cumberland recently announced the acquisition of Vaprisol from Astellas Pharma US, Inc.  Vaprisol is a patented, prescription brand indicated to raise serum sodium levels in hospitalized patients with euvolemic and hypervolemic hyponatremia. The product was developed and registered by Astellas and commercially launched in 2006. It is one of two branded prescription products indicated for the treatment of hyponatremia.

The product is a vasopressin receptor antagonist that raises serum sodium levels and promotes free water secretion.  Vaprisol does not require dilution and has a well-defined daily dose of 10 mg, 20 mg, or 40 mg. 

Under the terms of the deal, Cumberland will assume full responsibility for the product including its marketing, distribution and manufacture. Cumberland will promote Vaprisol across the United States through its hospital sales force, which also features its Caldolor and Acetadote brands.

Omeclamox®-Pak

Cumberland announced during the fourth quarter, an agreement with Pernix Therapeutics LLC for the promotion of Omeclamox-Pak covering the United States. Omeclamox-Pak is a branded prescription product that combines omeprazole, amoxicillin and clarithromycin for the treatment of Helicobacter pylori (H. pylori) infection and duodenal ulcer disease. It is the only FDA approved triple combination medication to contain omeprazole as the proton pump inhibitor and is prescribed over a shortened treatment period of ten days.

Under the terms of the agreement, Cumberland will promote the product to gastroenterologists across the United States through its field sales force, which also promotes its Kristalose brand. Pernix will promote the product through its specialty sales force focusing on select primary care physicians. The companies will cooperate in the marketing and other activities needed to support the commercialization of the brand.

Conference Call and Webcast

A conference call and live Internet webcast will be held on Tuesday, March 4, 2014 at 4:30 p.m. Eastern Time to discuss the Company's fourth quarter and annual 2013 financial results. To participate in the call, please dial 877-303-1298 (for U.S. callers) or 253-237-1032 (for international callers). A rebroadcast of the teleconference will be available for one week and can be accessed by dialing 855-859-2056 (for U.S. callers) or 404-537-3406 (for international callers). The Conference ID for the rebroadcast is 4339060. The live webcast and rebroadcast can be accessed via Cumberland's website at http://investor.shareholder.com/cpix/events.cfm.

About Cumberland Pharmaceuticals

Cumberland Pharmaceuticals Inc. is a specialty pharmaceutical company focused on the acquisition, development and commercialization of branded prescription products. The Company's primary target markets include hospital acute care and gastroenterology. Cumberland's marketed products include Acetadote® (acetylcysteine) Injection for the treatment of acetaminophen poisoning, Caldolor® (ibuprofen) Injection, the first injectable treatment for pain and fever approved in the United States, Kristalose® (lactulose) for Oral Solution, a prescription laxative, Omeclamox-Pak® for the treatment of H. pylori and duodenal ulcer disease and Vaprisol®, an intravenous treatment for hyponatremia. Cumberland is dedicated to providing innovative products that improve quality of care for patients. For more information on Cumberland, please visit the Company's website at www.cumberlandpharma.com.

About Acetadote

Acetadote, administered intravenously within 8 to 10 hours after ingestion of a potentially hepatotoxic quantity of acetaminophen, is indicated to prevent or lessen hepatic injury. Used in the emergency department, Acetadote is approved in the United States to treat overdose of acetaminophen, a common ingredient in many over-the-counter medications. Acetadote is contraindicated in patients with hypersensitivity or previous anaphylactoid reactions to acetylcysteine or any components of the preparation. Serious anaphylactoid reactions, including death in a patient with asthma, have been reported in patients administered acetylcysteine intravenously. Acetadote should be used with caution in patients with asthma or where there is a history of bronchospasm. The total volume administered should be adjusted for patients weighing less than 40 kg and for those requiring fluid restriction. To avoid fluid overload, the volume of diluent should be reduced as needed. If volume is not adjusted, fluid overload can occur, potentially resulting in hyponatremia, seizure and death.  For full prescribing information, visit www.acetadote.com.

About Caldolor

Caldolor is indicated for the management of mild to moderate pain and management of moderate to severe pain as an adjunct to opioid analgesics, as well as the reduction of fever in adults. It was the first FDA-approved intravenous therapy for fever. Caldolor is contraindicated in patients with known hypersensitivity to ibuprofen or other NSAIDs, patients with asthma, urticarial, or allergic type reactions after taking aspirin or other NSAIDs. Caldolor is contraindicated for use during the peri-operative period in the setting of coronary artery bypass graft (CABG) surgery. Caldolor should be used with caution in patients with prior history of ulcer disease or GI bleeding, in patients with fluid retention or heart failure, in the elderly, those with renal impairment, heart failure, liver impairment, and those taking diuretics or ACE inhibitors. Blood pressure should be monitored during treatment with Caldolor.  For full prescribing information, including boxed warning, visit www.caldolor.com.

About Kristalose

Kristalose is indicated for the treatment of acute and chronic constipation. It is a unique, proprietary, crystalline form of lactulose, with no restrictions on length of therapy or patient age. Initial dosing may produce flatulence and intestinal cramps, which are usually transient.  Excessive dosage can lead to diarrhea with potential complications such as loss of fluids, hypokalemia and hypernatremia. Nausea and vomiting have been reported. Use with caution in diabetics. Kristalose is contraindicated in patients who require a low-galactose diet. Elderly, debilitated patients who receive lactulose for more than six months should have serum electrolytes (potassium, chloride, carbon dioxide) measured periodically. For full prescribing information, visit www.kristalose.com.

About Omeclamox-Pak

Omeprazole is an antisecretory drug, which works by decreasing the amount of acid the stomach produces. Clarithromycin and amoxicillin are antibacterial drugs, which inhibit the growth of bacteria allowing the stomach lining to heal. Omeclamox-Pak is contraindicated in patients with a history of hypersensitivity to omeprazole, any macrolide antibiotic or penicillin. The safety and effectiveness of Omeclamox-Pak in the pediatric population has not yet been established. Omeclamox-Pak was approved by the U.S. Food and Drug Administration in 2011. For full prescribing information, visit www.omeclamox.com.

About Vaprisol

Vaprisol an intravenous treatment for hyponatremia used in the critical care setting. Hyponatremia is an electrolyte disturbance in which sodium ion concentration in blood plasma is lower than normal.  This can be associated with a variety of critical care conditions including congestive heart failure, liver failure, kidney failure and pneumonia.  The product is a vasopressin receptor antagonist that raises serum sodium levels and promotes free water secretion. Vaprisol was approved by the U.S. Food and Drug Administration in 2005 for euvolemic hyponatremia and in 2007 for hypervolemic hyponatremia. For full prescribing information, visit www.vaprisol.com.

Forward-Looking Statements

This press release contains forward-looking statements, which are subject to certain risks and reflect Cumberland's current views on future events based on what it believes are reasonable assumptions. No assurance can be given that these events will occur. As with any business, all phases of Cumberland's operations are subject to factors outside of its control, and any one or combination of these factors could materially affect Cumberland's results of operations. These factors include market conditions, competition, an inability of manufacturers to produce Cumberland's products on a timely basis or failure of manufacturers to comply with regulations applicable to pharmaceutical manufacturers, maintaining an effective sales and marketing infrastructure and other factors discussed in the Company's most recent Form 10-K and subsequent 10-Q's as filed with the SEC. There can be no assurance that results anticipated by the Company will be realized or that they will have the expected effects. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. The Company does not undertake any obligation to publicly revise these statements to reflect events after the date hereof.

 

CUMBERLAND PHARMACEUTICALS INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

December 31, 2013 and 2012




2013


2012






ASSETS





Current assets:





Cash and cash equivalents


$

40,869,457



$

54,349,381


Marketable securities


14,019,761



16,686,136


Accounts receivable, net of allowances


4,530,424



6,017,201


Inventories


5,722,882



6,218,355


Prepaid and other current assets


825,675



1,671,091


Deferred tax assets


2,711,516



2,290,078


Total current assets


68,679,715



87,232,242


Property and equipment, net


880,647



1,188,914


Intangible assets, net


15,498,819



9,476,798


Deferred tax assets


1,208,891



50,411


Other assets


1,345,666



645,366


Total assets


$

87,613,738



$

98,593,731







LIABILITIES AND EQUITY





Current liabilities:





Accounts payable


$

2,035,853



$

2,790,554


Other current liabilities


5,509,917



5,264,806


Total current liabilities


7,545,770



8,055,360


Revolving line of credit




4,359,951


Other long-term liabilities


776,125



611,933


Total liabilities


8,321,895



13,027,244


Commitments and contingencies





Equity:





Shareholders' equity:





Common stock – no par value; 100,000,000 shares authorized;

17,985,503 and 18,937,107 shares issued and outstanding as of

December 31, 2013 and 2012, respectively


63,073,941



67,197,167


Retained earnings


16,394,540



18,499,154


Total shareholders' equity


79,468,481



85,696,321


Noncontrolling interests


(176,638)



(129,834)


Total equity


79,291,843



85,566,487


Total liabilities and equity


$

87,613,738



$

98,593,731


 

CUMBERLAND PHARMACEUTICALS INC. AND SUBSIDIARIES

Consolidated Statements of Operations and Comprehensive (Loss) Income

(Unaudited)




Three months ended

December 31,


Years ended

December 31,



2013


2012


2013


2012










Revenues:









Net product revenue


$

8,054,928



$

13,637,333



$

31,100,698



$

47,944,031


Other revenue


104,739



59,033



926,764



907,206


Net revenues


8,159,667



13,696,366



32,027,462



48,851,237


Costs and expenses:









Cost of products sold


2,145,011



2,172,762



5,439,422



5,046,179


Selling and marketing


3,761,552



4,942,425



14,387,745



20,329,493


Research and development


1,339,295



441,215



5,615,501



5,095,172


General and administrative


3,100,407



2,752,567



9,489,976



9,055,959


Amortization


285,479



134,404



896,156



506,332


Total costs and expenses


10,631,744



10,443,373



35,828,800



40,033,135


Operating (loss) income


(2,472,077)



3,252,993



(3,801,338)



8,818,102


Interest income


68,582



48,791



230,291



304,865


Interest expense


(40,701)



(15,616)



(103,422)



(71,985)


(Loss) income before income taxes


(2,444,196)



3,286,168



(3,674,469)



9,050,982


Income tax benefit (expense)


932,801



(1,492,213)



1,523,051



(3,244,776)


Net (loss) income


(1,511,395)



1,793,955



(2,151,418)



5,806,206


Net loss at subsidiary attributable to

 noncontrolling interests


11,032



11,545



46,804



36,286


Net (loss) income attributable to

 common shareholders


$

(1,500,363)



$

1,805,500



$

(2,104,614)



$

5,842,492











Earnings (loss) per share attributable to

 common shareholders:









Basic


$

(0.08)



$

0.09



$

(0.11)



$

0.30


Diluted


$

(0.08)



$

0.09



$

(0.11)



$

0.30


Weighted-average common shares outstanding:









Basic


18,072,805



19,048,945



18,332,997



19,564,625


Diluted


18,072,805



19,245,047



18,332,997



19,787,537











Comprehensive (loss) income


$

(1,511,395)



$

1,793,955



$

(2,151,418)



$

5,806,206











 

CUMBERLAND PHARMACEUTICALS INC. AND SUBSIDIARIES


Condensed Consolidated Statements of Cash Flows


(Unaudited)


Years ended December 31, 2013 and 2012






2013


2012








Cash flows from operating activities:






Net (loss) income


$

(2,151,418)



$

5,806,206



Adjustments to reconcile net (loss) income to net cash flows

 provided by operating activities:






Depreciation and amortization expense


1,301,835



901,649



Deferred tax benefit


(1,579,918)



(829,846)



Share-based compensation


674,955



636,528



Excess tax benefit derived from exercise of stock options


(48,024)



(3,760,766)



Noncash interest expense


24,075



24,075



Noncash investment losses (gains)


178,822



(45,814)



Net changes in assets and liabilities affecting operating activities:






Accounts receivable


1,486,777



1,065,689



Inventories


495,473



(443,661)



Prepaid, other current assets and other assets


117,021



(648,941)



Accounts payable and other accrued liabilities


58,855



4,373,276



Other long-term liabilities


187,673



56,787



Net cash provided by operating activities


746,126



7,135,182



Cash flows from investing activities:






Additions to property and equipment


(97,412)



(464,893)



Additions to intangible assets


(7,462,080)



(2,071,926)



Proceeds from sale of marketable securities


6,859,061



5,220,480



Purchases of marketable securities


(4,371,508)



(21,860,802)



Net cash used in investing activities


(5,071,939)



(19,177,141)



Cash flows from financing activities:






Net repayments on line of credit


(4,359,951)



(500,000)



Repurchase of common shares


(4,800,908)



(8,086,594)



Exercise of stock options


(41,276)



618,022



Excess tax benefit derived from exercise of stock options


48,024



3,760,766



Net cash used in financing activities


(9,154,111)



(4,207,806)



Net decrease in cash and cash equivalents


(13,479,924)



(16,249,765)



Cash and cash equivalents, beginning of year


54,349,381



70,599,146



Cash and cash equivalents, end of year


$

40,869,457



$

54,349,381



 

SOURCE Cumberland Pharmaceuticals Inc.

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