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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

Current Report

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

 

 

 

Date of Report (Date of earliest event reported): August 6, 2021

 

ANI PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware 001-31812 58-2301143
(State or other jurisdiction
of incorporation)
(Commission File Number) (I.R.S. Employer
Identification Number)

 

210 Main Street West

Baudette, Minnesota

  56623
(Address of principal executive offices)   (Zip Code)

 

Registrant's telephone number, including area code: (218) 634-3500

 

(Former name or former address, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class:   Trading Symbol(s)   Name of each exchange on which registered:
Common Stock   ANIP   Nasdaq Stock Market

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

  

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

 

Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

 

 

 

 

Item 2.02   Results of Operations and Financial Condition.

 

On August 6, 2021, ANI Pharmaceuticals, Inc. (“ANI”) issued a press release announcing its financial and operating results for the three and six months ended June 30, 2021.  A copy of the press release is furnished as Exhibit 99.1 to this report.

 

In accordance with General Instruction B.2. of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01   Financial Statements and Exhibits.

 

(d) Exhibits

 

No.  Description
    
99.1  Press release, dated August 6, 2021, issued by ANI
    
104  Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document).

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  ANI PHARMACEUTICALS, INC.
   
   
  By: /s/ Stephen P. Carey
    Stephen P. Carey
    Senior Vice President, Finance and Chief Financial Officer

Dated:  August 6, 2021

 

 

 

 

 

Exhibit 99.1

 

 

 

FOR IMMEDIATE RELEASE

 

ANI Pharmaceuticals Reports Second Quarter 2021 Results

 

-- Second quarter 2021 net revenues of $48.6 million; net loss of $14.1 million and diluted loss per share of ($1.17) --

 

-- Second quarter adjusted non-GAAP EBITDA of $13.1 million and adjusted non-GAAP diluted earnings per share of $0.67 --

 

-- Refiled supplemental new drug application (“sNDA”) for Cortrophin Gel with U.S Food and Drug Administration (“FDA”) on June 29, 2021; goal date is October 29, 2021 --

 

-- Pending acquisition of Novitium Pharma LLC on track to close in second half 2021--

 

-- Expanded branded products portfolio through acquisition of Sandoz Inc. NDAs --

 

Baudette, Minnesota (August 6, 2021) – ANI Pharmaceuticals, Inc. (“ANI” or the “Company”) (NASDAQ: ANIP) today announced business highlights and financial results for the three and six months ended June 30, 2021.

 

Second Quarter and Recent Business Highlights:

 

·The Company refiled its supplemental new drug application (“sNDA”) for Cortrophin® Gel with the U.S. Food and Drug Administration (“FDA” or the “Agency”) on June 29, 2021; goal date is October 29, 2021;
·Acquisition of Novitium Pharma LLC (“Novitium”), a privately held, New Jersey-based high-growth pharmaceutical company, is on track to close in the second half of 2021, pending Federal Trade Commission (“FTC”) clearance and customary closing conditions; and
·Acquired new drug applications (“NDAs”) from Sandoz Inc. for a portfolio of dermatology products.

 

Second Quarter 2021 Financial Highlights:

 

·Net revenues were $48.6 million compared to $48.5 million in Q2 2020.
·GAAP net loss was $14.1 million, and diluted GAAP loss per share was ($1.17).
·Adjusted non-GAAP EBITDA was $13.1 million.
·Adjusted non-GAAP diluted earnings per share was $0.67.
·Cash and cash equivalents were $24.3 million, net accounts receivable was $92.6 million, and face value of debt was $205.7 million as of June 30, 2021.

 

 

 

 

“In the second quarter, we made meaningful progress executing on the four pillars of our growth strategy. Most notably, on June 29, we refiled our sNDA with the FDA for Cortrophin Gel. Since that time, we have engaged in productive communication with the Agency. In support of this important asset, we are continuing to strengthen our leadership team to drive our commercial strategy forward. This refiling is a significant milestone for the organization, and I am proud of what we have accomplished to date. If approved, Cortrophin has the potential to improve access for patients in need and transform ANI,” said Nikhil Lalwani, President and CEO of ANI.

 

“We appreciate our stockholders’ overwhelming support for the Novitium acquisition at our Annual Meeting of Stockholders. The transaction is on track to close later this year, and planning for maximizing the value of the combined assets for all stakeholders is well under way. We have also integrated the four dermatology products acquired from Sandoz, thus expanding our branded portfolio. It is an important and exciting time for ANI, and we look forward to providing updates as we move forward on our growth journey,” concluded Lalwani.

 

 

Second Quarter 2021 Financial Results

 

Net Revenues

(in thousands)

  Three Months Ended June 30, 
   2021   2020 
Generic pharmaceutical products  $34,199   $33,400 
Branded pharmaceutical products   11,038    10,633 
Contract manufacturing   2,322    2,900 
Royalty and other income   1,066    1,537 
Total net revenues  $48,625   $48,470 

 

Net revenues for generic pharmaceutical products were $34.2 million during the three months ended June 30, 2021, an increase of 2.4% compared to $33.4 million for the same period in 2020. From a product perspective, the net increase was due to increased sales of Fenofibrate, Potassium Citrate Extended Release, Vancomycin Oral Solution, and the second quarter 2021 launch of Nicardipine. These increases were somewhat tempered by declines in sales of Methazolamide, Miglustat, Penicillamine, and Mixed Amphetamine Salts.

 

Net revenues for branded pharmaceutical products were $11.0 million during the three months ended June 30, 2021, an increase of 3.8% compared to $10.6 million for the same period in 2020. The increase primarily reflects the launch of the products acquired in the Sandoz, Inc. acquisition in the second quarter of 2021 and increased sales of InnoPran XL. These increases were tempered by decreased revenues of Atacand and Arimidex.

 

 

 

 

Contract manufacturing revenues were $2.3 million during the three months ended June 30, 2021, a decrease of 19.9% compared to $2.9 million for the same period in 2020, due to a decreased volume of orders from contract manufacturing customers in the period.

 

Royalty and other revenues were $1.1 million during the three months ended June 30, 2021, a decrease of $0.4 million from $1.5 million for the same period in 2020, primarily due to decreases in product development revenues earned by ANI Canada and a the non-recurrence of royalty revenue related to Yescarta®. These decreases were tempered by licensing revenues earned during the three months ended June 30, 2021.

 

Operating expenses increased by 7.4% to $64.2 million for the three months ended June 30, 2021, from $59.8 million in the prior year period

 

Cost of sales, excluding depreciation and amortization, increased by $1.6 million to $22.3 million in the second quarter of 2021 from prior year period, primarily as a result of increased volumes in the current year period. The increase was tempered by a $1.2 million decrease related to a decrease in sales of products subject to profit sharing arrangements.

 

Research and development expenses decreased to $2.8 million in the second quarter of 2021 from $3.0 million in the second quarter of 2020, primarily due to the non-recurrence of $0.4 million of 2020 severance related expense associated with the restructuring of our internal Cortrophin development team.

 

Selling, general and administrative expenses decreased by $2.4 million in the second quarter of 2021 to $18.8 million compared to $21.2 million in the comparable quarter in 2020.The decrease primarily reflects the non-recurrence of $6.5 million of termination benefit expenses related to the 2020 departure of the Company’s former President and CEO. The Company also incurred recruitment and related legal charges associated with the CEO search in the second quarter 2020. These decreases were offset by $1.7 million of transaction expenses related to the pending Novitium acquisition and $2.5 million in sales and marketing expenses related to Cortrophin pre-launch activities incurred during the three months ended June 30, 2021.

 

On August 3, 2021, the Company entered into a Settlement Agreement with Arbor Pharmaceuticals, LLC to resolve all claims related to a civil proceeding which was pending trial later this month. Under the terms of the agreement, ANI will pay Arbor $8.4 million and Arbor will dismiss all claims against ANI. Neither party admitted wrongdoing in reaching this settlement. The Company recorded an $8.4 million charge to the second quarter Statement of Operations and will pay the settlement from cash on the balance sheet.

 

Depreciation and amortization increased by 1.1% in the second quarter of 2021 to $11.3 million from $11.2 million in the comparable quarter in 2020, primarily due to the amortization of the NDAs acquired in April 2021 from Sandoz Inc., partially offset by assets that became fully amortized in 2020.

 

 

 

 

Net loss for the second quarter of 2021 was $14.1 million as compared to net loss of $12.3 million in the prior year period. Diluted loss per share for the three months ended June 30, 2021 was ($1.17), compared to diluted loss per share of ($1.03) in the prior year period.

 

Adjusted non-GAAP diluted earnings per share was $0.67 in the second quarter of 2021 compared to $0.69 in the second quarter of 2020.

 

For reconciliations of adjusted non-GAAP EBITDA and adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure, please see Table 3 and Table 4, respectively.

 

Liquidity

 

As of June 30, 2021, the Company had $24.2 million in unrestricted cash and cash equivalents plus $92.6 million in net accounts receivable. The Company had $205.7 million (face value) in outstanding debt as of June 30, 2021.

 

Conference Call

 

As previously announced, ANI Pharmaceuticals management will host its second quarter 2021 conference call as follows:

 

Date Friday, August 6, 2021
Time 8:30 a.m. ET
Toll free (U.S.) (866) 342-8591

 

Webcast (live and replay) www.anipharmaceuticals.com, under the “Investors” section

 

A replay of the conference call will be available within two hours of the call’s completion and will remain accessible for one week by dialing 800-695-0974 and entering access code 5412658.

 

Non-GAAP Financial Measures

 

Adjusted non-GAAP EBITDA

 

ANI’s management considers adjusted non-GAAP EBITDA to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by non-cash stock-based compensation and differences in capital structures, tax structures, capital investment cycles, ages of related assets, and compensation structures among otherwise comparable companies. Management uses adjusted non-GAAP EBITDA when analyzing Company performance.

 

 

 

 

Adjusted non-GAAP EBITDA is defined as net income, excluding tax expense or benefit, interest expense, (net), other expense, (net), depreciation, amortization, the excess of fair value over cost of acquired inventory, non-cash stock-based compensation expense, expense from acquired in-process research and development, Novitium transaction expenses, Cortrophin pre-launch charges, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations. Adjusted non-GAAP EBITDA should be considered in addition to, but not in lieu of, net income or loss reported under GAAP. A reconciliation of adjusted non-GAAP EBITDA to the most directly comparable GAAP financial measure is provided below.

 

Adjusted non-GAAP Net Income

 

ANI’s management considers adjusted non-GAAP net income to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, Cortrophin pre-launch charges, acquired in-process research and development (“IPR&D”) expense, Novitium transaction expenses, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations. Management uses adjusted non-GAAP net income when analyzing Company performance.

 

Adjusted non-GAAP net income is defined as net income, plus the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation expense, Novitium transaction expenses, non-cash interest expense, depreciation and amortization expense, expense from acquired in-process research and development, Cortrophin pre-launch charges, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations, less the tax impact of these adjustments calculated using an estimated statutory tax rate. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI’s results. Adjusted non-GAAP net income should be considered in addition to, but not in lieu of, net income reported under GAAP. A reconciliation of adjusted non-GAAP net income to the most directly comparable GAAP financial measure is provided below.

 

Adjusted non-GAAP Diluted Earnings per Share

 

ANI’s management considers adjusted non-GAAP diluted earnings per share to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, Cortrophin pre-launch charges, acquired IPR&D expense, Novitium transaction expenses, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations. Management uses adjusted non-GAAP diluted earnings per share when analyzing Company performance.

 

 

 

 

Adjusted non-GAAP diluted earnings per share is defined as adjusted non-GAAP net income, as defined above, divided by the diluted weighted average shares outstanding during the period. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI’s results. Adjusted non-GAAP diluted earnings per share should be considered in addition to, but not in lieu of, diluted earnings or loss per share reported under GAAP. A reconciliation of adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure is provided below.

 

About ANI

 

ANI Pharmaceuticals, Inc. is an integrated specialty pharmaceutical company focused on delivering value to our customers by developing, manufacturing, and marketing high quality branded and generic prescription pharmaceuticals. We focus on niche and high barrier to entry opportunities including controlled substances, oncology products (anti-cancers), hormones and steroids, and complex formulations. For more information, please visit our website www.anipharmaceuticals.com.

 

Forward-Looking Statements

 

To the extent any statements made in this release relate to information that is not historical, these are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the Company’s corporate strategy, the pending acquisition of Novitium and anticipated benefits and results of such acquisition, future operations, products, financial position, operating results and prospects, including plans for growth, the Company’s pipeline or potential markets therefor, plans for existing ANDAs, timing of approval of our sNDA for Cortrophin Gel and commercialization plans, and other statements that are not historical in nature, particularly those that utilize terminology such as “anticipates,” “will,” “expects,” “plans,” “potential,” “future,” “believes,” “intends,” “continue,” other words of similar meaning, derivations of such words and the use of future dates.

 

Uncertainties and risks may cause the Company’s actual results to be materially different than those expressed in or implied by such forward-looking statements. Uncertainties and risks include, but are not limited to, the risk that the Company may not be able to obtain the requisite FTC approval or satisfy other closing conditions to complete the Novitium acquisition or such approvals will be further delayed, risks the Company may face with respect to importing raw materials; the use of single source suppliers and the time it may take to validate and qualify another supplier, if necessary; increased competition and strategies employed by competitors; the ability to realize benefits anticipated from acquisitions; costs and regulatory requirements relating to contract manufacturing arrangements; delays or failure in obtaining product approvals from the U.S. Food and Drug Administration; general business and economic conditions, including the ongoing impact of the COVID-19 pandemic; market trends for our products; regulatory environment and changes; and regulatory and other approvals relating to product development and manufacturing.

 

 

 

 

More detailed information on these and additional factors that could affect the Company’s actual results are described in the Company’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q. All forward-looking statements in this news release speak only as of the date of this news release and are based on the Company’s current beliefs, assumptions, and expectations. Except as required by law, the Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

 

Contact
Investor Relations:
Lisa M. Wilson, In-Site Communications, Inc.
T: 212-452-2793
E: lwilson@insitecony.com

 

SOURCE: ANI Pharmaceuticals, Inc.

  

Financial Tables Follow

 

 

 

 

ANI Pharmaceuticals, Inc. and Subsidiaries

Table 1: US GAAP Statement of Operations

(unaudited, in thousands, except per share amounts)

                 

   Three Months Ended June 30,   Six Months Ended June 30, 
   2021   2020   2021   2020 
Net Revenues  $48,625   $48,470   $103,146   $98,244 
                     
Operating Expenses:                    
                     
Cost of sales (excl. depreciation and amortization)   22,314    20,695    42,299    42,499 
Research and development   2,805    3,035    5,773    9,379 
Selling, general, and administrative   18,820    21,213    36,407    34,896 
Depreciation and amortization   11,324    11,198    22,222    22,381 
Legal settlement expense   8,400    -    8,400    - 
Cortrophin pre-launch charges   515    3,636    553    8,238 
                     
Total Operating Expenses   64,178    59,777    115,654    117,393 
                     
     Operating Loss   (15,553)   (11,307)   (12,508)   (19,149)
                     
Other Expense, Net                    
   Interest expense, net   (2,531)   (2,356)   (4,985)   (4,388)
   Other expense, net   (67)   (116)   (582)   (106)
                     
Loss Before Benefit for Income Taxes   (18,151)   (13,779)   (18,075)   (23,643)
                     
Benefit for income taxes   4,045    1,443    4,055    4,296 
                     
Net Loss  $(14,106)  $(12,336)  $(14,020)  $(19,347)
                     
Loss Per Share                    
Basic Loss Per Share  $(1.17)  $(1.03)  $(1.16)  $(1.62)
Diluted Loss Per Share  $(1.17)  $(1.03)  $(1.16)  $(1.62)
                     
Basic Weighted-Average Shares Outstanding   12,085    11,967    12,045    11,935 
Diluted Weighted-Average Shares Outstanding   12,085    11,967    12,045    11,935 

 

 

 

 

ANI Pharmaceuticals, Inc. and Subsidiaries

Table 2: US GAAP Balance Sheets

(uaudited, in thousands)

              

   June 30,
2021
   December 31,
2020
 
Current Assets          
    Cash and cash equivalents  $24,261   $7,864 
    Accounts receivable, net   92,648    95,793 
    Inventories, net   67,634    60,803 
    Prepaid income taxes   2,375    - 
    Prepaid expenses and other current assets   4,881    5,861 
        Total Current Assets   191,799    170,321 
           
Property and equipment   60,336    58,797 
Accumulated depreciation   (20,002)   (17,528)
        Property and equipment, net   40,334    41,269 
Restricted cash   5,001    5,003 
Deferred tax assets, net of deferred tax liabilities and valuation allowance   58,526    51,704 
Intangible assets, net   180,199    188,511 
Goodwill   3,580    3,580 
Other non-current assets   720    802 
       Total Assets  $480,159   $461,190 
           
Current Liabilities          
    Current debt, net of deferred financing costs  $15,182   $13,243 
    Accounts payable   12,977    11,261 
    Accrued expenses and other   11,582    2,456 
    Accrued royalties   4,688    6,407 
    Accrued compensation and related expenses   4,319    6,231 
    Current income taxes payable, net   -    3,906 
    Accrued government rebates   8,740    7,826 
    Returned goods reserve   31,904    27,155 
    Deferred revenue   62    80 
        Total Current Liabilities   89,454    78,565 
           
Non-current debt, net of deferred financing costs and current component   189,525    172,443 
Derivatives and other non-current liabilities   9,263    14,482 
       Total Liabilities   288,242    265,490 
           
Stockholders' Equity          
Common stock   1    1 
Treasury stock   (3,062)   (2,246)
Additional paid-in capital   219,403    214,354 
Accumulated deficit   (18,992)   (4,972)
Accumulated other comprehensive loss, net of tax   (5,433)   (11,437)
       Total Stockholders' Equity   191,917    195,700 
           
       Total Liabilities and Stockholders' Equity  $480,159   $461,190 

 

 

 

 

ANI Pharmaceuticals, Inc. and Subsidiaries

Table 3: Adjusted non-GAAP EBITDA Calculation and US GAAP to Non-GAAP Reconciliation

(unaudited, in thousands)

           

 

   Three Months Ended June 30, 
   2021   2020 
Net Loss  $(14,106)  $(12,336)
           
Add/(Subtract):          
Interest expense, net   2,531    2,356 
Other expense, net   67    116 
Benefit for income taxes   (4,045)   (1,443)
Depreciation and amortization   11,324    11,198 
Legal settlement expense   8,400    - 
Cortrophin pre-launch charges and sales & marketing expenses   2,902    3,636 
Stock-based compensation(1)   2,844    2,271 
CEO transition items(2)   -    7,145 
Cortrophin team restructuring   -    401 
Asset impairments(3)   -    40 
Excess of fair value over cost of acquired inventory   1,492    1,420 
Charges related to market exits   -    567 
Novitium transaction expenses   1,690    - 
Adjusted non-GAAP EBITDA  $13,099   $15,371 

 

   Reconciliation of certain adjusted non-GAAP accounts: 
   Cost of sales (excl.
depreciation and
amortization)
  Selling, general, and
administrative
expenses
  Research and
development
expenses
 
           
   Three Months Ended
June 30,
  Three Months Ended
June 30,
  Three Months Ended
June 30,
 
   2021  2020  2021  2020  2021  2020 
As reported:  $22,314  $20,695  $18,820  $21,213  $2,805  $3,035 
                          
Cortrophin pre-launch charges and sales & marketing expenses           (2,387)            
Stock-based compensation(1)   (6)  (39)  (2,683)  (2,074)  (155)  (158)
CEO transition items(2)               (7,145)        
Cortrophin team restructuring               (47)      (354)
Asset impairments(3)       (40)                
Excess of fair value over cost of acquired inventory   (1,492)  (1,420)                
Charges related to market exits       (267)              (300)
Novitium transaction expenses           (1,690)            
As adjusted:  $20,816  $18,929  $12,060  $11,947  $2,650  $2,223 

 

 

 

 

   Six Months Ended June 30, 
   2021   2020 
Net Loss  $(14,020)  $(19,347)
           
Add/(Subtract):          
Interest expense, net   4,985    4,388 
Other expense, net   582    106 
Benefit for income taxes   (4,055)   (4,296)
Depreciation and amortization   22,222    22,381 
Legal settlement expense   8,400    - 
Cortrophin pre-launch charges and sales & marketing expenses   3,044    8,238 
Stock-based compensation(1)   4,713    4,695 
CEO transition items(2)   -    7,145 
Cortrophin team restructuring   -    401 
Acquired IPR&D expense   -    3,784 
Asset impairments(3)   -    792 
Excess of fair value over cost of acquired inventory   1,492    4,071 
Charges related to market exits   -    567 
Novitium transaction expenses   4,633    - 
Adjusted non-GAAP EBITDA  $31,996   $32,925 

 

   Reconciliation of certain adjusted non-GAAP accounts: 
   Cost of sales (excl.
depreciation and
amortization)
  Selling, general, and
administrative
expenses
  Research and
development
expenses
 
           
   Six Months Ended
June 30,
  Six Months Ended
June 30,
  Six Months Ended
June 30,
 
   2021  2020  2021  2020  2021  2020 
As reported:  $42,299  $42,499  $36,407  $34,896  $5,773  $9,379 
                          
Cortrophin pre-launch charges and sales & marketing expenses           (2,490)            
Stock-based compensation(1)   (10)  (69)  (4,429)  (4,273)  (274)  (353)
CEO transition items(2)               (7,145)        
Cortrophin team restructuring               (47)      (354)
Acquired IPR&D expense                       (3,784)
Asset impairments(3)       (740)      (52)        
Excess of fair value over cost of acquired inventory   (1,492)  (4,071)                
Charges related to market exits       (267)              (300)
Novitium transaction expenses           (4,633)            
 As adjusted:  $40,797  $37,352  $24,855  $23,379  $5,499  $4,588 

 

(1) For the three and six months ended June 30, 2020, Stock-based compensation excludes $3.4 million of stock-based compensation expense associated with the departure of a former President and CEO.  This amount is included in this table as part of CEO transition items.

(2) For the three and six months ended June 30, 2020, CEO transition items is comprised of $3.4 million of stock compensation expense and $3.1 million of expense for salary continuation, bonus and other fringe benefits associated with the departure of a former President and CEO, as well as certain legal and recruiting costs related to the search for a permanent replacement.

(3) For the three months ended June 30, 2020, Asset impairments is comprised of a finished goods inventory reserve for Bretylium.  For the six months ended June 30, 2020, it is comprised of finished goods inventory reserves for Bretylium and an accounts receivable reserve due to customer bankruptcy, tempered by a modest recovery of previously reserved inventory related to market exits.                

       

 

 

 

ANI Pharmaceuticals, Inc. and Subsidiaries

Table 4: Adjusted non-GAAP Net Income and Adjusted non-GAAP Diluted Earnings per Share Reconciliation

(unaudited, in thousands, except per share amounts)

 

   Three Months Ended June 30,   Six Months Ended June 30, 
   2021   2020   2021   2020 
   Net Loss  $(14,106)  $(12,336)  $(14,020)  $(19,347)
                     
Add/(Subtract):                    
    Non-cash interest expense   539    500    1,085    657 
    Depreciation and amortization expense   11,324    11,198    22,222    22,381 
    Cortrophin pre-launch charges and sales & marketing expenses   2,902    3,636    3,044    8,238 
    Legal settlement expense   8,400    -    8,400    - 
    Acquired IPR&D expense   -    -    -    3,784 
 Stock-based compensation(1)   2,844    2,271    4,713    4,695 
 CEO transition items(2)   -    7,145    -    7,145 
 Cortrophin team restructuring   -    401    -    401 
   Asset impairments(3)   -    40    -    792 
 Excess of fair value over cost of acquired inventory   1,492    1,420    1,492    4,071 
 Charges related to market exits   -    567    -    567 
   Novitium transaction expenses   1,690    -    4,633    - 
Less:                    
  Estimated tax impact of adjustments (calc. at 24%)   (7,006)   (6,523)   (10,941)   (12,655)
                     
Adjusted non-GAAP Net Income  $8,080   $8,319   $20,627   $20,729 
                     
Diluted Weighted-Average                    
     Shares Outstanding   12,085    11,967    12,045    11,935 
Adjusted Diluted Weighted-Average                    
     Shares Outstanding   12,100    11,982    12,059    11,964 
                     
Adjusted non-GAAP                    
    Diluted Earnings per Share  $0.67   $0.69   $1.71   $1.73 

 

(1) For the three and six months ended June 30, 2020, Stock-based compensation excludes $3.4 million of stock-based compensation expense associated with the departure of a former President and CEO.  This amount is included in this table as part of CEO transition items.

 

(2) For the three and six months ended June 30, 2020, CEO transition items is comprised of $3.4 million of stock compensation expense and $3.1 million of expense for salary continuation, bonus and other fringe benefits associated with the departure of a former President and CEO, as well as certain legal and recruiting costs related to the search for a permanent replacement.

 

(3)  For the three months ended June 30, 2020, Asset impairments is comprised of a finished goods inventory reserve for Bretylium. For the six months ended June 30, 2020, it is comprised of finished goods inventory reserves for Bretylium and an accounts receivable reserve due to customer bankruptcy, tempered by a modest recovery of previously reserved inventory related to market exits.