Medicure Reports Financial Results for Quarter Ended June 30, 2018

WINNIPEG, Aug. 15, 2018 /CNW/ - Medicure Inc. ("Medicure" or the "Company") (TSXV:MPH, OTC:MCUJF), a cardiovascular pharmaceutical company, today reported its results from operations for the quarter ended June 30, 2018. 

Quarter Ended June 30, 2018 Highlights:

• Recorded net revenue of $7.8 million during the quarter ended June 30, 2018 compared to $8.1 million for the quarter ended June 30, 2017;
  
  
• Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA¹) for the quarter ended June 30, 2018 was $829,000 compared to adjusted EBITDA of $1.8 million for the quarter ended June 30, 2017; and
  
  
• Net income for the quarter ended June 30, 2018 was $1.6 million compared to $1.4 million for the quarter ended June 30, 2017.
  
  
• $69.9 million in cash and short-term investments as at June 30, 2018.

Financial Results

Net revenues from AGGRASTAT^® for the three months ended June 30, 2018 were $7.2 million compared to $8.1 million for the three months ended June 30, 2017.  Net revenues from AGGRASTAT^® for the six months ended June 30, 2018 were $13.3 million compared to $15.1 million for the six months ended June 30, 2017.  Additionally, ZYPITAMAG™ (pitavastatin magnesium), which was launched commercially in May 2018, contributed an additional $606,000 of net revenue for the three and six months ended June 30, 2018.  

The Company continues to experience an increase in patient market share and an increase in the number of new hospital customers using AGGRASTAT^®, again leading to the highest hospital demand for AGGRASTAT^® in the Company's history. Although, there was an increase in use of AGGRASTAT^®, the lower net revenue was largely due to increased competitive pricing of generic Integrilin and a stronger Canadian dollar compared to its US counterpart. 

Medicure continues to focus on expanding the customer base for AGGRASTAT^® and ZYPITAMAG™ and continuing to diversify the Company's revenue base.

Adjusted EBITDA for the three months ended June 30, 2018 was $829,000 compared to $1.8 million for the three months ended June 30, 2017.  Adjusted EBITDA for the six months ended June 30, 2018 was $1.7 million compared to $3.4 million for the six months ended June 30, 2017.

The decrease in adjusted EBITDA for the quarter is the result of:

• lower revenues which were primarily due to lower discounted prices for AGGRASTAT^® and a higher Canadian dollar relative to its US counterpart,
• higher selling, general and administrative costs during the period in relation to the on-going marketing of AGGRASTAT^® and the launch of ZYPITAMAG™,
• higher cost of goods sold due to higher volume of AGGRASTAT^® sold during the period,
• partially offset by;
• lower research and development expenses when compared to the same period in 2017 as a result of timing of expenses relating to the Company's research and development projects.

Net income for the three months ended June 30, 2018 was $1.6 million or $0.10 per share compared to $1.4 million or $0.09 per share for the three months ended June 30, 2017. The net income for the 2017 quarter includes a net loss of $184,000 from discontinued operations relating to the results from the Apicore business, which was divested in 2017. Excluding the loss from discontinued operations, net income for the three months ended June 30, 2018 was consistent with the same period in 2017 and included increases in foreign exchange gains resulting from increased U.S. dollar denominated cash and short-term investment balances, partially offset by lower revenues for the three months ended June 30, 2018.

Net income for the six months ended June 30, 2018 was $3.0 million or $0.19 per share compared to a net loss $3.7 million or $0.24 per share for the six months ended June 30, 2017. The net loss for 2017 includes a net loss of $6.4 million from discontinued operations relating to the results from the Apicore business, which was divested in 2017.  Excluding the loss from discontinued operations, net income for the six months ended June 30, 2018 increased by $232,000 over same period in 2017 primarily due to foreign exchange gains resulting from increased U.S. dollar denominated cash and short-term investment balances, partially offset by lower revenues for the six months ended June 30, 2018.

As at June 30, 2018, the Company had cash and short-term investments totaling $69.9 million compared to $5.3 million as of December 31, 2017.  This consisted of $17.3 million of unrestricted cash and $52.7 million of short-term investments in the form of term deposits with maturities of greater than three months and less than one year. As at June 30, 2018, the Company had working capital of $85.6 million compared to $70.9 million at December 31, 2017. The Company had cash used in operating activities of $2.5 million for the six months ended June 30, 2018 compared to $4.7 million for the six months ended June 30, 2017.

All amounts referenced herein are in Canadian dollars unless otherwise noted.

Notes

⁽¹⁾ The Company defines EBITDA as "earnings before interest, taxes, depreciation, amortization and other income or expense" and Adjusted EBITDA as "EBITDA adjusted for non-cash and one-time items".  The terms "EBITDA" and "Adjusted EBITDA", as it relates to the quarters ended June 30, 2018 and 2017 results prepared using International Financial Reporting Standards ("IFRS"), do not have any standardized meaning according to IFRS. It is therefore unlikely to be comparable to similar measures presented by other companies.

Conference Call Info:

Topic:  Medicure's Q2 2018 Results

Call date:  Thursday August 16, 2018

Time:  7:30 AM Central Time (8:30 AM Eastern Time)

Canada toll-free: 1 [phone]   Canada toll: 1 [phone]

United States toll-free: 1 [phone]

Passcode: 5781086#

Webcast:    This conference call will be webcast live over the internet and can be accessed from the Medicure investor relations page at the following link: http://www.medicure.com/investors.html  

You may request international country-specific access information by e-mailing the Company in advance. Management will accept and answer questions related to the financial results and operations during the question-and-answer period at the end of the conference call. A recording of the call will be available following the event at the Company's website.

About Medicure

Medicure is a pharmaceutical company focused on the development and commercialization of therapeutics for the U.S. cardiovascular market. The present focus of the Company is the marketing and distribution of AGGRASTAT^® (tirofiban hydrochloride) injection and ZYPITAMAG™ (pitavastatin magnesium) tablets in the United States, where they are sold through the Company's U.S. subsidiary, Medicure Pharma, Inc. For more information on Medicure please visit www.medicure.com.

To be added to Medicure's e-mail list, please visit: 
http://medicure.mediaroom.com/alerts

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward Looking Information: Statements contained in this press release that are not statements of historical fact, including, without limitation, statements containing the words "believes", "may", "plans", "will", "estimates", "continues", "anticipates", "intends", "expects" and similar expressions, may constitute "forward-looking information" within the meaning of applicable Canadian and U.S. federal securities laws (such forward-looking information and forward-looking statements are hereinafter collectively referred to as "forward-looking statements"). Forward-looking statements, include the target launch date for new products, the estimated number of products the Company will be selling in the future, estimates, analysis and opinions of management of the Company made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors which the Company believes to be relevant and reasonable in the circumstances. Inherent in forward-looking statements are known and unknown risks, uncertainties and other factors beyond the Company's ability to predict or control that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements, and as such, readers are cautioned not to place undue reliance on forward-looking statements. Such risk factors include, among others, the Company's future product revenues, stage of development, additional capital requirements, risks associated with the completion and timing of clinical trials and obtaining regulatory approval to market the Company's products, the ability to protect its intellectual property, dependence upon collaborative partners, changes in government regulation or regulatory approval processes, and rapid technological change in the industry. Such statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions about: general business and economic conditions; the impact of changes in Canadian-US dollar and other foreign exchange rates on the Company's revenues, costs and results; the timing of the receipt of regulatory and governmental approvals for the Company's research and development projects; the availability of financing for the Company's commercial operations and/or research and development projects, or the availability of financing on reasonable terms; results of current and future clinical trials; the uncertainties associated with the acceptance and demand for new products and market competition. The foregoing list of important factors and assumptions is not exhaustive. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, other than as may be required by applicable legislation. Additional discussion regarding the risks and uncertainties relating to the Company and its business can be found in the Company's other filings with the applicable Canadian securities regulatory authorities or the US Securities and Exchange Commission, and in the "Risk Factors" section of its Form 20F for the year ended December 31, 2017.

AGGRASTAT® (tirofiban hydrochloride) is a registered trademark of Medicure International Inc.

Condensed Consolidated Interim Statements of Financial Position (expressed in Canadian dollars) (unaudited)
		June 30, 2018		December 31, 2017
Assets
Current assets:
	Cash and cash equivalents	$	17,266,970	$	5,260,480
	Short-term investments	52,672,000		-
	Accounts receivable	14,885,540		8,588,255
	Consideration receivable	-		82,678,366
	Inventories	3,076,421		3,075,006
	Prepaid expenses	3,020,604		903,914
	Holdback receivable	12,856,731		-
	Assets held for sale	-		14,052,861
	Total current assets	103,778,266		114,558,882
Non‑current assets:
	Property and equipment	290,431		221,622
	Intangible assets	1,777,680		1,756,300
	Holdback receivable	-		12,068,773
	Deferred tax assets	301,947		326,108
	Total non‑current assets	2,370,058		14,372,803
Total assets		$	106,148,324	$	128,931,685
Liabilities and Equity
Current liabilities:
	Accounts payable and accrued liabilities	$	16,105,672	$	10,371,103
	Accrued transaction costs	-		22,360,730
	Income taxes payable	563,295		2,428,560
	Current portion of royalty obligation	1,470,767		1,537,202
	Liabilities held for sale	-		6,976,313
	Total current liabilities	18,139,734		43,673,908
Non‑current liabilities
	Royalty obligation	2,903,103		2,911,810
	License fee payable	-		501,800
	Other long-term liabilities	-		1,135,007
	Total non‑current liabilities	2,903,103		4,548,617
Total liabilities		21,042,837		48,222,525
Equity:
	Share capital	124,475,021		125,733,727
	Warrants	1,948,805		1,948,805
	Contributed surplus	7,369,513		6,897,266
	Accumulated other comprehensive income	2,756,676		673,264
	Deficit	(51,444,528)		(54,543,902)
Total equity		85,105,487		80,709,160
Total liabilities and equity		$	106,148,324	$	128,931,685

Condensed Consolidated Interim Statements of Net Income (loss) and Comprehensive Income (loss) (expressed in Canadian dollars) (unaudited)
		Three months ended June 30, 2018		Three months ended June 30, 2017		Six months ended June 30, 2018		Six months ended June 30, 2017
Revenue, net
	Product sales, net	$	7,800,379	$	8,054,181	$	13,864,754	$	15,067,577
Cost of goods sold		1,201,634		777,450		1,990,868		1,331,848
Gross Profit		6,598,745		7,276,731		11,873,886		13,735,729
Expenses
	Selling, general and administrative	5,047,331		4,091,786		8,978,058		7,613,032
	Research and development	1,070,783		1,444,545		1,980,130		2,754,568
		6,118,114		5,536,331		10,958,188		10,367,600
Income before the undernoted		480,631		1,740,400		915,698		3,368,129
Other income:
	Revaluation of holdback receivable	83,768		-		167,348		-
		83,768		-		167,348		-
Finance (income) costs:
	Finance (income) expense, net	(94,652)		316,575		(18,430)		634,170
	Foreign exchange gain, net	(1,022,651)		(268,339)		(2,035,411)		(274,469)
		(1,117,303)		48,236		(2,053,841)		359,701
Net income before taxes		1,681,702		1,692,164		3,136,887		3,008,428
Income tax expense:
	Current	(65,004)		(153,027)		(143,120)		(286,282)
	Deferred	(21,559)		-		(39,204)		-
Net income before discontinued operations		1,595,139		1,539,137		2,954,563		2,722,146
Net loss from discontinued operations, net of tax		-		(184,132)		-		(6,442,666)
Net income (loss)		1,595,139		1,355,005		2,954,563		(3,720,520)
Translation adjustment, attributable to:
	Continuing operations	928,726		92,034		2,083,412		(303,040)
	Discontinued operations	-		762,195		-		41,171
Comprehensive income (loss)		2,523,865		2,209,234		5,037,975		(3,982,389)
Earnings per share from continuing operations:
	Basic	0.10		0.10		0.19		0.17
	Diluted	0.09		0.09		0.17		0.15
Loss per share from discontinued operations:
	Basic	-		(0.01)		-		(0.41)
	Diluted	-		(0.01)		-		(0.41)
Earnings (loss) per share:
	Basic	0.10		0.09		0.19		(0.24)
	Diluted	0.09		0.08		0.17		(0.26)

Condensed Consolidated Interim Statements of Cash Flows (expressed in Canadian dollars) (unaudited)
For the six months ended June 30			2018		2017
Cash (used in) provided by:
Operating activities:
	Net income from continuing operations for the period		$	2,954,563	$	2,722,146
	Net loss from discontinued operations for the period		-		(6,442,666)
			2,954,563		(3,720,520)
	Adjustments for:
		Current income tax expense	143,120		286,282
		Deferred income tax expense (recovery)	39,204		(1,914,390)
		Revaluation of holdback receivable	(167,348)		-
		Amortization of property and equipment	47,572		828,834
		Amortization of intangible assets	64,556		5,052,446
		Share‑based compensation	675,200		122,741
		Finance (income) expense, net	(18,430)		4,345,807
		Unrealized foreign exchange gain	(404,062)		(273,819)
	Change in the following:
		Accounts receivable	(6,297,285)		(1,528,624)
		Inventories	(1,415)		(202,280)
		Prepaid expenses	(2,116,690)		(529,862)
		Other assets	-		(7,165)
		Accounts payable and accrued liabilities	4,821,389		(2,950,658)
		Deferred revenue	-		(77,821)
		Other long-term liabilities	-		2,409
	Interest received (paid), net		471,695		(2,886,666)
	Income taxes paid		(2,041,317)		(332,450)
	Royalties paid		(712,935)		(922,021)
Cash flows used in operating activities			(2,542,183)		(4,707,757)
Investing activities:
	Proceeds from Apicore Sale Transaction, net of tax		65,234,555		-
	Acquisition of short-term investments, net		(49,894,400)		-
	Acquisition of property and equipment		(116,274)		(846,548)
	Acquisition of Class E common shares of Apicore		-		(2,640,725)
Cash flows from (used in) investing activities			15,223,881		(3,487,273)
Financing activities:
	Proceeds from exercise of stock options		256,085		242,478
	Proceeds from exercise of Apicore stock options		-		421,942
	Proceeds from exercise of warrants		-		92,332
	Buy-back of common shares		(1,450,972)		-
	Repayment of long-term debt		-		(13,211,947)
	Decrease in cash in escrow		-		12,809,072
	Finance lease payments		-		(79,570)
	Proceeds from short-term borrowings		-		106,838
Cash flows (used in) from financing activities			(1,194,887)		381,145
Foreign exchange gain (loss) on cash held in foreign currency			519,679		(650)
Increase (decrease) in cash			12,006,490		(7,814,535)
Cash and cash equivalents, beginning of period			5,260,480		12,266,177
Cash and cash equivalents, end of period			$	17,266,970	$	4,451,642

SOURCE Medicure Inc.

please contact: James Kinley, Chief Financial Officer, Tel. [phone], Fax [phone], E-mail: [email protected], www.medicure.com

Related Links

http://www.medicure.com/