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Osiris Therapeutics, Inc Reports Third Quarter 2018 Results

COLUMBIA, Md., Nov. 07, 2018 (GLOBE NEWSWIRE) -- Osiris Therapeutics, Inc. (NASDAQ: OSIR), a regenerative medicine company focused on developing and marketing products for wound care, orthopedics, and sports medicine, today reported its results for the third quarter ending September 30, 2018.

Business Highlights

  • GrafixPL PRIMETM launched on October 1, 2018
  • Enrollment of patients in a clinical trial evaluating GrafixPL PRIME in the treatment of chronic venous leg ulcers
  • Company re-listed on the Nasdaq Global Market on August 1, 2018

Quarterly Financial Summary

Revenue was $36.5 million for the three-month period ended September 30, 2018, which increased $6.7 million or 22.4%, compared to revenue of $29.8 million for the three-month period ended September 30, 2017.  The increase in revenue was primarily due to higher Grafix®/Stravix® revenue of $5.6 million as a result of increased demand from market awareness and acceptance as we increased selling efforts in the operating room and surgical settings as well as hospital outpatient wound care centers.  In addition, we received a one-time settlement payment of $1.3 million from a former distributor that was accounted for on a cash basis, as collection was not reasonably assured, to settle amounts owed to us from previous years, primarily 2015 and 2016.  BIO revenue increased $1.1 million, or 18.1%, due to increased demand from our distribution arrangement with Stryker. 

Gross profit was $26.7 million for the three-month period ended September 30, 2018, which increased $4.8 million or 22.0%, compared with gross profit of $21.9 million for the three-month period ended September 30, 2017.  This increase was primarily due to higher revenues and the collection of the $1.3 million settlement from a former distributor that was accounted for on a cash basis, which did not have any cost of revenue as the cost of revenue was recognized in the periods the product was shipped.

Cash flow from operations was $8.1 million for the three-month period ended September 30, 2018, which was driven by net income of $4.2 million, collection of outstanding accounts receivable of $2.9 million, and the add back of the non-cash accrued shareholder litigation expense of $0.9 million.

See the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of our Quarterly Report on Form 10-Q filed today with the Securities and Exchange Commission for additional information concerning our operating results for the three- and nine month periods ended September 30, 2018.

About Osiris Therapeutics

Osiris Therapeutics, Inc., based in Columbia, Maryland, researches, develops, manufactures and commercializes regenerative medicine products intended to improve the health and lives of patients and lower overall healthcare costs.  We have achieved commercial success with products in orthopedics, sports medicine and wound care, including the Grafix product line, Stravix®, BIO and Cartiform®.  We continue to advance our research and development by focusing on innovation in regenerative medicine, including the development of bioengineered stem cell and tissue‑based products.  Osiris®, Grafix®, GrafixPL®, GrafixPL PRIME Cartiform®, and Prestige Lyotechnologysm are our trademarks. BIO is a trademark of Howmedica Osteonics Corp., a subsidiary of Stryker Corporation. More information can be found on the Company’s website, www.Osiris.com. (OSIR-G)

Forward-Looking Statements

Statements herein relating to the future of Osiris Therapeutics, Inc. and the ongoing research and development of our products are forward-looking statements.  Osiris Therapeutics, Inc. cautions that these forward looking statements are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by such statements.  These risks and uncertainties include those identified under the heading “Risk Factors” in the Osiris Therapeutics Inc. Annual Report on Form 10-K for the years ended December 31, 2017, 2016 and 2015 and Quarterly Report on Form 10-Q for the quarters ended March 31, 2018, June 30, 2018 and September 30, 2018 as filed with the Securities and Exchange Commission (SEC).  We caution investors not to place considerable reliance on the forward-looking statements contained in this press release.  Examples of forward-looking statements may include, without limitation, statements regarding the anticipated efficiencies and advantages of products and the likelihood of customer clinical adoption of any new products.  Although well characterized in scientific literature and studies, preservation of tissue integrity, including cells, may not be indicative of clinical outcome.  Accordingly, you should not unduly rely on these forward-looking statements. You are encouraged to read our filings with the SEC, available at sec.gov, for a discussion of these and other risks and uncertainties.  The forward-looking statements in this press release speak only as of the date of this document, and we undertake no obligation to update or revise any of the statements.  Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.

For additional information, please contact:
Diane Savoie
Osiris Therapeutics, Inc.
(443) 545-1834
OsirisPR@Osiris.com


FINANCIAL TABLES TO FOLLOW

       
       
OSIRIS THERAPEUTICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except per share data)
(Unaudited)
       
  September 30,  December 31,
  2018 2017
Assets      
Current assets      
Cash and cash equivalents $31,658  $3,081 
Short-term investments  8,701   24,807 
Trade receivables, net  20,592   26,053 
Inventory, net  10,576   11,278 
Insurance receivable  4,788   4,788 
Prepaid expenses and other current assets  3,421   2,920 
Total current assets  79,736   72,927 
Property and equipment, net  3,116   3,587 
Other assets  1,849   1,608 
Total assets $84,701  $78,122 
       
Liabilities and Equity      
Current liabilities      
Accounts payable $4,291  $5,269 
Accrued liabilities  10,704   9,399 
Accrued shareholder litigation  19,400   18,500 
Other current liabilities  1,994   1,934 
Total current liabilities  36,389   35,102 
Other long-term liabilities  2,450   1,626 
Total liabilities  38,839   36,728 
       
Equity      
Common stock, $0.001 par value, 72,000 shares authorized, 34,526 shares issued and outstanding at September 30, 2018, and 90,000 shares authorized, 34,526 shares issued and outstanding at December 31, 2017  35   35 
Additional paid-in-capital  284,124   283,905 
Accumulated other comprehensive loss  (330)  (208)
Accumulated deficit  (237,967)  (242,338)
Total equity  45,862   41,394 
Total liabilities and equity $84,701  $78,122 


              
OSIRIS THERAPEUTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(amounts in thousands, except per share data)
(Unaudited)
              
  Three Months Ended  Nine Months Ended  
  September 30,  September 30,  
  2018  2017  2018  2017  
Revenue $36,491  $29,806  $102,001  $85,938  
Cost of revenue  9,808   7,926   28,333   23,405  
Gross profit  26,683   21,880   73,668   62,533  
Operating expenses:             
Research and development  1,590   909   4,886   3,052  
Sales and marketing  15,931   14,825   49,107   44,256  
General and administrative  4,302   6,634   15,150   16,920  
Shareholder litigation expense  900      900     
Total operating expenses  22,723   22,368   70,043   64,228  
Income (loss) from continuing operations  3,960   (488)  3,625   (1,695) 
Other (expense) income, net  (21)  (1,763)  548   (1,371) 
Income (loss) before income taxes from continuing operations  3,939   (2,251)  4,173   (3,066) 
Income tax (expense) benefit  (100)  198   (170)  134  
Income (loss) from continuing operations  3,839   (2,053)  4,003   (2,932) 
Discontinued operations, net of tax  368   9,811   368   9,811  
Net income  4,207   7,758   4,371   6,879  
Other comprehensive income (loss):             
Unrealized (loss) gain on investments  (100)  (21)  (122)  33  
Comprehensive income $4,107  $7,737  $4,249  $6,912  
Net income (loss) per share from continuing operations:             
Basic $0.11  $(0.06) $0.12  $(0.08) 
Diluted $0.11  $(0.06) $0.12  $(0.08) 
Net income per share from discontinued operations:             
Basic $0.01  $0.28  $0.01  $0.28  
Diluted $0.01  $0.28  $0.01  $0.28  
Net income per share:             
Basic $0.12  $0.22  $0.13  $0.20  
Diluted $0.12  $0.22  $0.13  $0.20  
Weighted average common shares outstanding:             
Basic  34,526   34,526   34,526   34,524  
Diluted  34,594   34,526   34,565   34,525  


        
OSIRIS THERAPEUTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(Unaudited)
        
  Nine Months Ended September 30,  
  2018  2017  
CASH FLOWS FROM OPERATING ACTIVITIES       
Net income $ 4,371  $ 6,879  
Adjustments to reconcile net income to net cash provided by (used in) operating activities:       
Receipt of Mesoblast common stock   —    (10,000) 
Shareholder litigation expense   900    —  
Provision for excess and obsolete inventory   1,238    180  
Loss on disposal of fixed assets   —    123  
Realized loss on investments   240    2,102  
Depreciation   658    518  
Stock-based compensation expense   219    49  
Changes in operating assets and liabilities:       
Accounts receivables, net   5,461    1,220  
Inventory, net   (536)   (1,228) 
Prepaid expenses and other assets   (742)   (651) 
Accounts payable, accrued liabilities, and other liabilities   1,211    (1,791) 
Net cash provided by (used in) operating activities   13,020    (2,599) 
CASH FLOWS FROM INVESTING ACTIVITIES       
Purchases of property and equipment   (187)   (718) 
Proceeds from sale of investments   16,248    23,250  
Purchases of investments   (504)   (19,660) 
Net cash provided by investing activities   15,557    2,872  
CASH FLOWS FROM FINANCING ACTIVITIES       
Proceeds from the exercise of options to purchase common stock   —    128  
Net cash provided by financing activities   —    128  
NET INCREASE IN CASH AND CASH EQUIVALENTS   28,577    401  
Cash and cash equivalents at beginning of period   3,081    2,833  
Cash and cash equivalents at end of period $ 31,658  $ 3,234  

 

Wednesday, November 7, 2018 - 16:15