Assertio Holdings, a specialty pharmaceutical company known for its acquisition, commercialization, and development of safe and effective therapies, released its financial results for the third quarter (Q3) ending on September 30, 2023. Following this announcement, the stock of Assertio Holdings, which concluded trading at $2.13 the previous day, opened at $1.16 today and is presently trading at $1.15.
At the time of this publication, Assertio Holdings Inc stock (ASRT) has witnessed a decline.
Assertio Holdings Inc
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Assertio Holdings Q3 2023 Results
In comparison to the previous year’s third quarter, the results for the third quarter of 2023 are as follows:
– Net product sales saw an increase from $34.3 million to $35.1 million, representing a year-over-year growth.
– The incorporation of Rolvedon and Sympazan sales in the current period were largely offset by declines in Indocin and Cambia sales following the entry of their respective generic versions.
– Rolvedon’s net product sales amounted to $7.1 million for the two months post the acquisition of Spectrum. An initial assessment revealed several factors that influenced the third quarter performance. While the launch’s early phase benefited from favorable reimbursement, the expected incremental demand from a permanent J-code, effective April 1, did not materialize, and there were elevated inventory levels in the channel at the close of the second quarter.
– Indocin net product sales in the third quarter were $17.9 million, reflecting a $4.0 million decrease from the prior year quarter due to competition from generic and compounded versions.
– Gross margin for the third quarter stood at 80%, down from 88% in the previous year’s third quarter. Inventory step-up amortization for Rolvedon accounted for a $1.8 million decrease, contributing to a 500 basis point reduction, with the rest of the change primarily attributed to shifts in sales mix resulting from declines in Indocin and Cambia.
– Selling, general, and administrative (SG&A) expenses amounted to $21.0 million, an increase from $11.9 million in the prior year’s third quarter. On a year-over-year basis, the 2023 third quarter included $2.7 million in Spectrum transaction costs and $5.9 million in higher operating expenses due to the inclusion of Rolvedon and Sympazan.
– The third quarter of 2023 featured the following non-cash items: a $238.8 million charge for the impairment of intangible assets, driven by the revaluation of long-lived assets following a decline in market capitalization during the quarter; a benefit of $17.5 million in fair value of contingent consideration, compared to an expense of $3.9 million in the prior year’s third quarter, primarily resulting from the revaluation of the Indocin contingent liability due to generic entry; and an income tax expense of $50.7 million, an increase from $0.2 million in the prior year’s third quarter, primarily due to the impact of a $43.0 million tax expense resulting from the application of a full valuation allowance against net deferred tax assets.
– Adjusted EBITDA stood at $12.9 million, a decrease from $21.4 million in the prior year’s third quarter, primarily due to higher operating expenses resulting from the addition of Rolvedon and Sympazan.
In terms of the balance sheet and cash flow:
– As of September 30, 2023, cash and cash equivalents totaled $76.9 million.
– The outstanding principal balance of convertible debt at September 30, 2023, amounted to $40 million and is not due until September 2027.
– Cash generated from operating activities for the quarter-to-date and year-to-date periods was $2.6 million and $43.9 million, respectively. These figures include transaction costs associated with the merger and supporting Spectrum’s current working capital needs.
