Harrow Announces Fourth Quarter and Year-End 2022 Financial Results
NASHVILLE, Tenn. , March 23 /Businesswire/ - Harrow (NASDAQ: HROW), a leading U.S. eyecare pharmaceutical company, today announced results for the fourth quarter and year ended December 31, 2022. The Company also posted its fourth quarter and year-end Letter to Stockholders and corporate presentation to the “Investors” section of its website, harrow.com.
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“2022 was truly a transformational year for Harrow,” said Mark L. Baum, CEO of Harrow. “Our IHEEZO™ journey has been remarkable – with its FDA approval in September 2022, and recently, in 2023, its issuance of a permanent J-Code (J2403) and Transitional Pass‑Through Reimbursement payment status. We believe that the J-Code and Pass-Through designations will enable a more efficient reimbursement process for ophthalmologists, optometrists, and retina specialists and create greater accessibility to the many clinical benefits that IHEEZO provides. We are confident that the infrastructure investments we made throughout 2022 to strengthen our people, platform, and performance will greatly contribute to a successful launch of IHEEZO in May 2023.
“We also were successful in 2022 in significantly expanding our product portfolio in terms of both branded pharmaceutical products (BPPs) and compounded pharmaceutical products (CPPs). We transitioned NDAs for BPPs, such as IOPIDINE® and MAXITROL®, and we rounded out the year by announcing the acquisition of U.S. commercial rights to ILEVRO®, NEVANAC®, VIGAMOX®, MAXIDEX®, and TRIESENCE®, which are currently in various stages of preparedness for revitalization and relaunch once their NDAs are transferred to Harrow. We also launched several new compounded pharmaceutical products, including Fortisite™, and launched Atropine.com for easier distribution of Atropine, including our next-generation compounded Atropine formulations that do not contain either preservatives or boric acid. Lastly, in 2022, we realized our goal of becoming a “pure-play ophthalmic pharmaceutical company” with the divestiture of our non‑ophthalmic-related assets.
“We believe that Harrow is well positioned as one of the leading U.S. eyecare pharmaceutical companies, meeting the needs of our customers and patients where they are and providing them accessible and affordable pharmaceutical medicines and formulations that fill unmet needs in ophthalmology. I speak for the entire Harrow Family when I say that we are very excited – and prepared – for what 2023 (and beyond) has in store for us.”
Fourth quarter and year-end 2022 figures of merit:
|
For the Three Months Ended
|
For the Years Ended
|
||||||||||||
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
||
Net revenues |
$ |
20,329,000 |
|
$ |
20,188,000 |
|
$ |
88,595,000 |
|
$ |
72,476,000 |
|
||
Gross margin |
|
70 |
% |
|
75 |
% |
|
71 |
% |
|
75 |
% |
||
Core gross margin(1) |
|
71 |
% |
|
75 |
% |
|
73 |
% |
|
75 |
% |
||
Net income (loss) |
|
1,055,000 |
|
|
(7,418,000 |
) |
|
(14,086,000 |
) |
|
(18,479,000 |
) |
||
Core net income (loss)(1) |
|
2,104,000 |
|
|
(3,525,000 |
) |
|
1,540,000 |
|
(4,353,000 |
) |
|||
Adjusted EBITDA(1)(2) |
|
1,089,000 |
|
|
(1,482,000 |
) |
|
13,017,000 |
|
|
11,378,000 |
|
||
Basic and diluted net income (loss) per share |
|
0.04 |
|
|
(0.27 |
) |
|
(0.51 |
) |
|
(0.69 |
) |
||
Core net income (loss) per share(1): |
|
|
|
|
|
|
|
|
|
|||||
Basic |
|
0.08 |
|
|
(0.13 |
) |
|
0.05 |
|
(0.16 |
) |
|||
Diluted |
0.07 |
(0.13 |
) |
0.05 |
(0.16 |
) |
(1) |
Core gross margin, core net income (loss), core basic and diluted net income (loss) per share (collectively, “Core Results”), and Adjusted EBITDA are non‑GAAP measures. For additional information, including a reconciliation of such Core Results and Adjusted EBITDA to the most directly comparable measures presented in accordance with GAAP, see the explanation of non‑GAAP measures and reconciliation tables at the end of this release. |
|
(2) |
The Company recently made a change to its methodology for reporting of Adjusted EBITDA to include acquired in-process R&D (“IPR&D”) charges. During the 2021 reporting periods, similar IPR&D transactions were excluded from Adjusted EBITDA for reporting purposes. This change is the result of the U.S. Securities and Exchange Commission’s recent industry correspondence on this matter. |
Conference Call and Webcast
The Company’s management team will host a conference call and live webcast today at 4:45 p.m. Eastern Time to discuss the fourth quarter and year-end 2022 results and provide a business update. To participate in the call, see details below:
Conference Call Details: |
|
|
Date: |
Thursday, March 23, 2023 |
|
Time: |
4:45 p.m. Eastern time |
|
Participant Dial-in: |
1-833-953-2434 (U.S.)
|
|
Replay Dial-in (Passcode 2628819): (telephonic replay through March 30, 2023) |
1-877-344-7529 (U.S.)
|
|
Webcast: (online replay through March 23, 2024) |
About Harrow
Harrow (Nasdaq: HROW) is a leading U.S. eyecare pharmaceutical company engaged in the discovery, development, and commercialization of innovative ophthalmic prescription therapies that are accessible and affordable. Harrow owns U.S. commercial rights to ten FDA-approved ophthalmic pharmaceutical products. Harrow also owns and operates ImprimisRx, the leading U.S. ophthalmic‑focused pharmaceutical compounding business, which also serves as a mail‑order pharmacy licensed to ship prescription medications in all 50 states. Harrow has non‑controlling equity positions in Surface Ophthalmics, Inc. and Melt Pharmaceuticals, Inc., companies that began as subsidiaries of Harrow. Harrow also owns royalty rights in four late‑stage drug candidates being developed by Surface and Melt.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Any statements in this release that are not historical facts may be considered such “forward-looking statements.” Forward-looking statements are based on management's current expectations and are subject to risks and uncertainties which may cause results to differ materially and adversely from the statements contained herein. Some of the potential risks and uncertainties that could cause actual results to differ from those predicted include the continued impact of the COVID-19 pandemic and any future health epidemics on our financial condition, liquidity and results of operations; our ability to make commercially available our FDA-approved products and compounded formulations and technologies in a timely manner or at all; market acceptance of the Company’s products and challenges related to the marketing of the Company’s products; risks related to our pharmacy operations; our ability to enter into other strategic alliances, including arrangements with pharmacies, physicians and healthcare organizations for the development and distribution of our products; our ability to obtain intellectual property protection for our assets; our ability to accurately estimate our expenses and cash burn, and raise additional funds when necessary; risks related to research and development activities; the projected size of the potential market for our technologies and products; unexpected new data, safety and technical issues; regulatory and market developments impacting compounding pharmacies, outsourcing facilities and the pharmaceutical industry; competition; and market conditions. These and additional risks and uncertainties are more fully described in Harrow’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. Such documents may be read free of charge on the SEC's web site at www.sec.gov. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. Except as required by law, Harrow undertakes no obligation to update any forward-looking statements to reflect new information, events, or circumstances after the date they are made, or to reflect the occurrence of unanticipated events.
HARROW HEALTH, INC. CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||
|
December 31, |
|||||
|
|
2022 |
|
|
2021 |
|
(unaudited) |
|
|
||||
ASSETS |
||||||
Cash and cash equivalents |
$ |
96,270,000 |
$ |
42,167,000 |
||
All other current assets |
|
21,990,000 |
|
18,495,000 |
||
Total current assets |
|
118,260,000 |
|
60,662,000 |
||
All other assets |
|
37,168,000 |
|
37,667,000 |
||
TOTAL ASSETS |
$ |
157,378,000 |
$ |
98,329,000 |
||
|
||||||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||
Current liabilities |
$ |
18,632,000 |
$ |
9,722,000 |
||
Loans payable, net of current portion and unamortized debt discount |
|
104,174,000 |
|
71,654,000 |
||
All other liabilities |
|
7,332,000 |
|
6,022,000 |
||
TOTAL LIABILITIES |
|
130,138,000 |
|
87,398,000 |
||
TOTAL STOCKHOLDERS' EQUITY |
|
27,240,000 |
|
10,931,000 |
||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
157,378,000 |
$ |
98,329,000 |
HARROW HEALTH, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
|
For the Three Months Ended
|
|
For the Years Ended
|
|||||||||||||
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
Total revenues |
$ |
20,329,000 |
|
$ |
20,188,000 |
|
$ |
88,595,000 |
|
$ |
72,476,000 |
|
||||
Cost of sales |
|
6,165,000 |
|
|
5,080,000 |
|
|
25,383,000 |
|
|
18,214,000 |
|
||||
Gross profit |
|
14,164,000 |
|
|
15,108,000 |
|
|
63,212,000 |
|
|
54,262,000 |
|
||||
Selling, general and administrative |
|
15,239,000 |
|
|
12,672,000 |
|
|
58,243,000 |
|
|
41,315,000 |
|
||||
Research and development |
|
703,000 |
|
|
3,942,000 |
|
|
3,050,000 |
|
|
11,084,000 |
|
||||
Impairment of intangible assets |
|
- |
|
|
249,000 |
|
|
- |
|
|
249,000 |
|
||||
Total operating expenses |
|
15,942,000 |
|
|
16,863,000 |
|
|
61,293,000 |
|
|
52,648,000 |
|
||||
(Loss) income from operations |
|
(1,778,000 |