Here are 7 things, in no particular order, that current and prospective investors in Insys should pay attention to from its recent earnings release.
Net Revenues in Q2 of 2017 were $42.6 million, down 38% from $69.2 million, in the second quarter of 2016. The revenue decline observed in the quarter can be attributed to lower Subsys prescriptions (the company’s only commercialized product in this reporting quarter) related to soft demand for long-acting opioids more broadly.
Sales and Marketing Expenses increased to 38% of net revenues in Q2 of 2017, or $13.3 million compared to 28% of net revenue, and $19.7 million in the second quarter of last year.
Research and Development Expenses decreased to $14.1 million for Q2 of 2017 versus $22.9 million in Q2’16. This decrease in R&D expenses can be attributed to the timing of new product development costs.
Charges Relating to Litigation and Government Settlements.Insys reported $4.5 million in this category, an estimated potential settlement with the State of Illinois.
Net loss for Q2 of 2017 was $8.2 million — or a loss of $0.11 per basic and diluted share.
In the conference call, Insys highlighted the launch of Syndros, their recently-commercialized dronabinol (synthetic THC) oral solution. The company’s sales approach is to target doctors that currently prescribe Marinol (AbbVie’s dronabinol tablet) and sell them on the benefits of Syndros’ alternate delivery system.
Management estimates that Syndros has the potential of becoming a $200 million per year product.
During the call, the company’s Chief Medical Officer, Santosh Vetticaden highlighted their cannabinoid pipeline (beyond Syndros). Insys’ has successfully produced synthetic pharmaceutical CBD that is 99.5% pure.
The company is currently conducting stage one and two trials of both synthetic and naturally derived CBD for indications, including multiple types of catastrophic childhood epilepsy, gliomablastoma, glioma, pediatric schizophrenia and more.
They have attained an orphan drug designation for their potential CBD treatment in the indications of gliomablastoma, glioma and pediatric schizophrenia.
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