Innovus Pharmaceuticals Reports Record Annual Revenue for Fiscal 2017 of $8.8 Million, Preliminary Q1 2018 Revenue of $4.3 Million to $4.4 Million and Expects to Exit 2018 Profitable

Published: Apr 02, 2018

SAN DIEGO--(BUSINESS WIRE)-- Innovus Pharmaceuticals, Inc., (“Innovus Pharma”) (OTCQB: INNV), today announced full year 2017 net revenue of $8.8 million compared to $4.8 million in revenue for the same period in 2016 and fourth quarter of 2017 net revenue of $2.4 million compared to $1.7 million in revenue for the same period in 2016.

Preliminary first quarter 2018 net revenue is estimated to be between $4.3 million to $4.4 million or an approximate 85% increase from the fourth quarter of 2017. Innovus Pharma's first quarter 2018 anticipated revenue results are preliminary and based on the most current information available and are subject to completion of the consolidated financial statements for the first quarter of 2018.

“We have seen tremendous growth in our product pipeline and overall net revenue during 2017 and the growth story continues into 2018 with our record first quarter net revenue of an estimated $4.3 million to $4.4 million. We believe our revenue growth into 2018 highlights the continued strength of our ability to sell multiple products through our Beyond Human® sales and marketing platform and other sales channels,” stated Bassam Damaj, President and Chief Executive Officer of Innovus Pharma. “As we look forward to exiting 2018 as a profitable Company when excluding non-cash expenses, we continue to be focused on increasing annual revenue to at least $18 million by executing on our goals of expanding our product lines and making our products commercially available in the United States and outside of the United States through our partners and new sales channels, as well as achieving profitability.”

Financial highlights for the year ended December 31, 2017 included:

  • Net revenue totaled $8.8 million for the year ended December 31, 2017 compared to net revenue of $4.8 million for the year ended December 31, 2016 representing an increase of 83.0%.
  • Net revenue during 2017 was impacted by the natural disasters in Florida, Texas as well as major holidays as the Company was unable to advertise its products for a period of time in those regions and periods as a result. These two states generate close to 15% of our total net revenue and have a population of approximately 17 million in our targeted product demographics*.
  • Gross margins increased to 79.0% for the year ended December 31, 2017, compared to 77.5% for the year ended December 31, 2016.
  • Total operating expense increased to $13.9 million and included $1.1 million in non-cash share-based compensation for the year ended December 31, 2017.
  • Net loss totaled $6.5 million, or $0.04 per common share, for the year ended December 31, 2017 compared to a net loss of $13.7 million, or $0.15 per common share, for the year ended December 31, 2016 representing a decrease of 52.5%. The net loss in 2017 included interest expense of $0.9 million, of which $0.8 million was non-cash and related to amortization of debt discounts. The net loss also included a non-cash expense of $0.7 million for the loss on debt extinguishment.
  • Cash balance totaled $1.6 million at December 31, 2017 and current total cash on hand is $4.7 million.

Financial highlights for the three months ended December 31, 2017 included:

  • Net revenues totaled $2.4 million for the three months ended December 31, 2017 compared to net revenues of $1.7 million for the three months ended December 31, 2016 representing a 40.7% increase.
  • Sequential quarter over quarter revenue increase of 7.1% in the fourth quarter 2017 compared to a decrease of 10.1% in the fourth quarter 2016.
  • Gross margins remained consistent at 78.2% for the three months ended December 31, 2017 and 2016.
  • Total operating expenses increased to $3.5 million and included $0.1 million in non-cash share-based compensation for the three months ended December 31, 2017.
  • Loss from operations decreased to $1.1 million during the three months ended December 31, 2017 compared to $1.9 million during the three months ended December 31, 2016 representing a 42.9% decrease.
  • Net loss totaled $1.5 million, or $0.01 per common share, for the three months ended December 31, 2017 compared to $3.4 million, or $0.03 per common share, for the three months ended December 31, 2016 representing a decrease of 55.5%. The net loss in 2017 included a non-cash expense of $0.3 million for the loss on debt extinguishment. The net loss also included interest expense of $0.1 million which was non-cash and related to amortization of debt discounts.

Fourth quarter 2017 and recent developments:

  • Received our first commercial batch of 220,000 units of FlutiCare® in October 2017 and launched FlutiCare® in the U.S. in November 2017;
  • Moved corporate and company operations into a new 17,000 square-foot facility in San Diego, CA in November 2017 that brought in-house the Company’s product fulfillment and inventory storage process. The move was designed to lower product fulfillment costs which will increase our gross product margins and decrease our loss from operations, as well as, provide the necessary office space to accommodate our expected revenue growth in 2018;
  • Received net cash proceeds of $2.7 million from the exercise of warrants to purchase shares of the Company’s common stock, raised net cash proceeds of $1.9 million from the issuance of notes payable during the first quarter of 2018 and current total cash on hand is $4.7 million;
  • Entered into an exclusive license and distribution agreement with Acerus Pharmaceuticals in January 2018 granting them exclusive rights to market and sell UriVarx® in Canada;
  • Entered into an exclusive license and distribution agreement with Lavasta Pharma in January 2018 granting them exclusive rights to market and sell ProstaGorx® in various countries in the Middle East and North Africa;
  • Launched six new products; and
  • Received multiple product approvals in Canada.

The Company will host a conference call at 4:15 p.m. ET/1:15 p.m. PT today to discuss the financial results and recent business developments. To participate in the call, please dial 1-877-883-0383 for domestic callers or 1-412-902-6506 for international callers. Participant Elite Entry Number: 9576665. A replay of the call will be available for 30 days. To access the replay, dial 1-877-344-7529 domestically or 1-412-317-0088 internationally and reference Conference ID: 10118224. The replay will be available shortly after the end of the conference call.

Consolidated Statements of Operations  
                       
    Three months ended     Year ended  
    December 31,     December 31,  
    2017     2016     2017     2016  
    (unaudited)        
Net revenue:                      
Product sales, net   $2,379,510     $1,691,491     $8,806,300     $4,817,603  
License revenue   -     -     10,000     1,000  
Total net revenue   2,379,510     1,691,491     8,816,300     4,818,603  
                       
Operating expense:                      
Cost of product sales   519,194     368,810     1,848,325     1,083,094  
Research and development   11,829     30,137     38,811     77,804  
Sales and marketing   1,983,842     1,363,879     6,853,559     3,621,045  
General and administrative   966,928     1,858,215     5,174,827     5,870,572  
Total operating expense   3,481,793     3,621,041     13,915,522     10,652,515  
                       
Loss from operations   (1,102,283 )   (1,929,550 )   (5,099,222 )   (5,833,912 )
                       
                       
Other income and (expense):                      
Interest expense   (100,281 )   (660,942 )   (872,166 )   (6,661,694 )
Loss on extinguishment of debt   (305,891 )   -     (700,060 )   -  
Other income (expense), net   (1,256 )   (190 )   (6,878 )   1,649  
Fair value adjustment for contingent consideration   (1,425 )   (1,464,638 )   194,034     (1,269,857 )
Change in fair value of derivative liabilities   15,542     697,687     (16,596 )   65,060  
Total other expense, net   (393,311 )   (1,428,083 )   (1,401,666 )   (7,864,842 )
                       
Loss before provision for income taxes   (1,495,594 )   (3,357,633 )   (6,500,888 )   (13,698,754 )
                       
Provision for income taxes   -     2,400     3,200     2,400  
                       
Net loss   $(1,495,594 )   $(3,360,033 )   $(6,504,088 )   $(13,701,154 )
                       
             
Net loss per share of common stock – basic and diluted:  

$ (0.01

 

)

 

$ (0.03

)

 

$ (0.04

)

 

$ (0.15

 

)

                       
Weighted average number of shares of common stock outstanding – basic and diluted  

174,575,366

   

116,765,431

   

157,933,458

   

94,106,382

 
                 
   

Condensed Consolidated Balance Sheet Data

 
   
             
             
    December 31, 2017   December 31, 2016    
   

1

 

   

1

 

 
Assets            
Cash   $ 1,564,859     $ 829,933    
Accounts receivable, net   68,259       33,575    
Prepaid expenses and other current assets   363,080       863,664    
Inventories   1,725,698       599,856    
Intangible assets and other non-current assets   5,309,010       5,900,350    
Total assets   $ 9,030,906     $ 8,227,378    
Liabilities & Stockholders' Equity            
Accounts payable & accrued liabilities   $ 2,607,121     $ 1,210,050    
Total accrued compensation   2,650,197       2,299,593    
Deferred revenue and customer deposits   24,690       11,000    
Accrued interest payable   3,648       47,782    
Short-term loans payable   65,399       -    
Notes payable and non-convertible debenture, net of discount   1,239,296       681,127    
Total derivative liabilities   58,609       483,744    
Total contingent consideration   1,479,003       1,685,917    
Convertible debentures, net of discount   -       714,192    
Total stockholders' equity   902,943       1,093,973    
Total liabilities & stockholders' equity   $ 9,030,906     $ 8,227,378    

1 The Condensed Consolidated Balance Sheet Data has been derived from the audited consolidated financial statements as of that date.

About Innovus Pharmaceuticals, Inc.

Headquartered in San Diego, Innovus Pharma is an emerging OTC consumer goods and specialty pharmaceutical company engaged in the commercialization, licensing and development of safe and effective non-prescription medicine and consumer care products to improve men’s and women’s health and vitality and respiratory diseases. Innovus Pharma delivers innovative and uniquely presented and packaged health solutions through its (a) OTC medicines and consumer and health products, which we market directly, (b) commercial partners to primary care physicians, urologists, gynecologists and therapists, and (c) directly to consumers through our on-line channels, retailers and wholesalers. The Company is dedicated to being a leader in developing and marketing new OTC and branded Abbreviated New Drug Application (“ANDA”) products. The Company is actively pursuing opportunities where existing prescription drugs have recently, or are expected to, change from prescription (or Rx) to OTC.

For more information, go to www.innovuspharma.com; www.zestra.com; www.ejectdelay.com; www.myvesele.com; www.urivarx.com; www.sensumplus.com; www.myandroferti.com; www.beyondhumantestosterone.com; www.getbeyondhuman.com; www.trybeyondhuman.com; www.recalmax.com; www.prostagorx.com; www.fluticare.com; www.allervarx.com; and www.apeaz.com.

* Population data for Florida and Texas gathered from the 2010 Census Brief from the United States Census Bureau.

Innovus Pharma’s Forward-Looking Safe Harbor

Statements under the Private Securities Litigation Reform Act, as amended: with the exception of the historical information contained in this release, the matters described herein contain forward-looking statements that involve risks and uncertainties that may individually or mutually impact the matters herein described for a variety of reasons that are outside the control of the Company, including, but not limited to, its financial results, projected revenues, projected online subscribers and other customers, estimated markets for its products, and statements about achieving its other corporate and business development, growth, commercialization, financial and staffing objectives. Readers are cautioned not to place undue reliance on these forward-looking statements as actual results could differ materially from the forward-looking statements contained herein. Readers are urged to read the risk factors set forth in the Company's most recent filing on Form S-1, annual report on Form 10-K, subsequent quarterly reports filed on Form 10-Q and other filings made with the SEC. Copies of these reports are available from the SEC's website or without charge from the Company.

 

Contacts

Innovus Pharma Investor Relations
Randy Berholtz, +1 858-249-7865
ir@innovuspharma.com

 

 
 

Source: Innovus Pharmaceuticals, Inc.

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