DUBLIN, Nov. 5, 2014 /PRNewswire/ -- Endo International plc (NASDAQ: ENDP) (TSX: ENL) today reported third quarter 2014 revenues of $764 million, an increase of 16 percent compared to third quarter 2013 revenues of $661 million. Endo reported a net loss of $252 million in the third quarter 2014 compared to net income of $40 million in the third quarter of 2013.
The reported net loss in the third quarter of 2014 is primarily attributable to the announcement made by Endo on September 30, 2014 of an increase to the company’s pre-tax product liability accrual for all known, pending and estimated future claims in the U.S. primarily related to vaginal mesh products.
As detailed in the supplemental financial information below, adjusted net income for the three months ended September 30, 2014 increased by 13 percent to $182 million, compared to adjusted net income of $161 million for the third quarter of 2013.
Reported diluted loss per share for the third quarter of 2014 was $1.64, compared to the third quarter 2013 reported earnings per share of $0.33. Adjusted diluted EPS decreased by 14 percent to $1.15 for the third quarter of 2014 compared to $1.34 for the same period in 2013. The decrease in adjusted diluted EPS is primarily attributable to the loss of exclusivity for branded LIDODERM® offset by the completion of multiple accretive transactions including the transformational merger with Paladin Labs which was completed in February, as well as the corporate restructuring initiated in mid-2013.
“Endo continues to make progress towards our objective of becoming a leading, global specialty healthcare company,” said Rajiv De Silva, President and CEO of Endo. “As a result of our strong third quarter financial results we are raising financial guidance for full-year 2014. Our third quarter results provide Endo with the opportunity to continue to invest in sustainable organic growth options, as well as the execution of additional value-creating M&A. We believe that our recently announced agreement to acquire Auxilium Pharmaceuticals is important from a strategic and a financial perspective, and we are confident the combination will deliver substantial accretion and create significant value for shareholders of both companies. We also believe this transaction will further accelerate our sales and earnings growth trajectory for 2015 and beyond.”
FINANCIAL PERFORMANCE
($ in thousands, except per share amounts)
3rd Quarter | Nine Months Ended | ||||||||||||||||||||
2014 | 2013 | Change | 2014 | 2013 | Change | ||||||||||||||||
Total Revenues | $ | 763,938 | $ | 661,319 | 16 | % | $ | 2,077,231 | $ | 2,031,961 | 2 | % | |||||||||
Reported Net Income | $ | (252,084) | $ | 40,223 | NM | $ | (667,836) | $ | 90,571 | NM | |||||||||||
Reported Diluted EPS | $ | (1.64) | $ | 0.33 | NM | $ | (4.62) | $ | 0.77 | NM | |||||||||||
Adjusted Net Income | $ | 182,267 | $ | 160,713 | 13 | % | $ | 490,014 | $ | 450,299 | 9 | % | |||||||||
Adjusted Diluted Weighted Average Shares | 158,975 | 120,261 | 32 | % | 155,902 | 116,890 | 33 | % | |||||||||||||
Adjusted Diluted EPS | $ | 1.15 | $ | 1.34 | (14) | % | $ | 3.14 | $ | 3.85 | (18) | % | |||||||||
U.S. BRANDED PHARMACEUTICALS
On October 9, Endo announced that it had reached a definitive agreement with Auxilium Pharmaceuticals, Inc. under which Endo will acquire all of the outstanding shares of common stock of Auxilium in a cash and stock transaction. Endo believes that the strategic and financial benefits of the combination will position the company and its U.S. Branded Pharmaceuticals business for future growth and value creation.
Third quarter 2014 branded pharmaceutical revenues were $241 million, a 34 percent decrease when compared to the third quarter 2013 branded pharmaceutical revenues. This decrease was primarily attributable to the decrease in net sales of LIDODERM®. Third quarter 2014 net sales of LIDODERM decreased 72 percent compared to the third quarter 2013. This decrease is attributable to the effects of the loss of market exclusivity for the product in September 2013.
Third quarter 2014 net sales of OPANA® ER decreased 17 percent when compared to the third quarter 2013. This decrease is primarily attributable to a year-over-year decrease in demand. According to IMS Health, total prescriptions for OPANA ER decreased by 11 percent in the third quarter of 2014 when compared to the third quarter of 2013.
Third quarter 2014 net sales of Voltaren® Gel increased 3 percent when compared to third quarter 2013 net sales. This increase is attributable to growth in demand. According to IMS Health, total prescriptions for Voltaren Gel increased by 16 percent in the third quarter of 2014 when compared to the third quarter of 2013.
U.S. GENERIC PHARMACEUTICALS
On August 6, Endo announced that it completed the acquisition of DAVA Pharmaceuticals, Inc., a privately-held company specializing in marketed, pre-launch and pipeline generic pharmaceuticals. The acquisition enhances Endo’s commercialization and development platform and is expected to be immediately accretive to Endo’s 2014 adjusted earnings per share.
Third quarter 2014 generic product net sales of $319 million increased 74 percent when compared to third quarter 2013 generic product net sales. This increase is mainly attributable to the addition of sales from Boca Pharmacal and DAVA Pharmaceuticals following the close of those acquisitions in February 2014 and August 2014 respectively and sales of the Authorized Generic (AG) version of LIDODERM following the launch of that product by the U.S. Generics business in May 2014.
Excluding the aforementioned additions, sales for the U.S. Generics business increased by approximately 13 percent when compared to third quarter generic product net sales. This increase is primarily attributable to increased sales of the U.S. Generics business’ broad portfolio of controlled substance products.
INTERNATIONAL PHARMACEUTICALS
In the third quarter 2014, the International Pharmaceuticals segment reported sales of $93.8 million which were attributable to the Paladin Labs business following the February 2014 closing of that acquisition and sales of products by Grupo Farmaceutico Somar following the closing of that acquisition in July 2014.
DEVICES
In the third quarter 2014, Endo reported device sales of $110 million compared to third quarter 2013 sales of $111 million.
To read full press release, please click here.
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