For release at 6:30 a.m.
Robert F. Doman, President & CEO – 978.909.2216
Richard Christopher, VP Finance & CFO – 978.909.2211
Chad Rubin, Investor Relations Contact, The Trout Group LLC – 646.378.2947
Cory Tromblee, Media Contact, MacDougall Biomedical Communications – 781.235.3060
DUSA Pharmaceuticals Reports
Full Year 2010 Corporate Highlights and Financial Results
Record Fourth Quarter Results Drive the Company to
its First Full Year of Profitability and Positive Cash Flow
Fourth Quarter Highlighted by 45% Domestic PDT Revenue Growth
Conference call will be held today, March 3rd, at 8:30am EDT
WILMINGTON, Mass. – March 3, 2011 — DUSA Pharmaceuticals, Inc.® (NASDAQ GM: DUSA), a dermatology company that is developing and marketing Levulan® Photodynamic Therapy (PDT) and other products focused on patients with common skin conditions, reported today its corporate highlights and financial results for the fourth quarter and full year ended December 31, 2010.
Fourth quarter and full year financial highlights:
“2010 was a landmark year for DUSA,” stated Robert Doman, President and CEO. “For the first time in our history, we reached profitability and generated positive cash flow on a full year basis.”
“Our record fourth quarter results, highlighted by a 45% year-over-year increase in our domestic PDT revenues, 88% gross margin achievement on the Kerastick®, and $3.0 million in non-GAAP income, allowed us to deliver on our goals of achieving profitability and positive cash flow for 2010. We were also pleased with the 91 BLU-U® units sold, a 69% increase from the same quarter the previous year,” continued Doman.
“The strength of our fourth quarter results clearly demonstrates the continued uptake of Levulan® and BLU-U® by the dermatological community. At this point, with mid-single digit market penetration, we believe that there is significant upside potential for Levulan® PDT. As we enter 2011, we intend to build the business on the momentum created in 2010 by expanding our sales force headcount by 5 and by planning to initiate a clinical trial in the second quarter aimed at expanding the label on our approved actinic keratosis indication as we continue our efforts to drive shareholder value,” concluded Doman.
Other 2010 Highlights:
Looking Forward into 2011:
Fourth Quarter 2010 Financial Results:
Total product revenues were a record $12.0 million in the fourth quarter of 2010, an increase of $3.2 million or 37% from $8.8 million in the fourth quarter of 2009. PDT revenues totaled $11.9 million, an increase of $3.4 million or 40% from $8.5 million for the comparable 2009 period. The increase in PDT revenues was attributable to a $3.1 million increase in Kerastick® revenues and a $0.3 million increase in BLU-U® revenues. The Kerastick® revenue improvement was driven by a 31% increase in sales volumes and a 7% increase in our average selling price. Kerastick® sales volumes increased to 85,122 units sold in the fourth quarter of 2010 from 64,904 units sold in the comparable 2009 period. Domestic Kerastick® sales volumes increased by 22,170 units or 36% and were offset by a 1,952 unit decrease in our international sales volumes. BLU-U® revenues totaled $0.7 million, up $0.3 million year-over-year. There were 91 units sold during the fourth quarter, as compared to the 54 units sold in the comparable prior year quarter. Non-PDT revenues were $0.1 million for the quarter, down $0.2 million year-over-year.
DUSA’s net income on a GAAP basis was $2.9 million or $0.12 per common share for the fourth quarter of 2010, compared to net income of $0.4 million or $0.02 per common share in the fourth quarter of 2009.
Please refer to the section entitled “Use of Non-GAAP Financial Measures” and the accompanying financial table included at the end of this release for a reconciliation of GAAP to non-GAAP results for the three and twelve-month periods ended December 31, 2010 and 2009, respectively.
DUSA’s non-GAAP net income for the fourth quarter of 2010 was $3.0 million or $0.12 per common share, compared to a net income of $0.9 million or $0.04 per common share in the prior year period. The improvement in the Company’s profitability was the result of the year-over-year increase in our PDT revenues, which was partially offset by an increase in our operating costs.
Full Year 2010 Financial Results:
Total product revenues for the year ended December 31, 2010 were $37.4 million, an increase of $7.6 million or 26% from $29.8 million in 2009. PDT revenues totaled $36.4 million, an increase of $8.1 million or 29% from $28.3 million for the comparable 2009 period. The increase in PDT revenues was attributable to an $8.1 million increase in Kerastick® revenues. The Kerastick® revenue improvement was driven by a 19% increase in volume, a 9% increase in average selling price; as well as, the acceleration of the recognition of $0.6 million in deferred revenues and milestone payments associated with the termination in September 2010 of our Marketing, Distribution and Supply Agreement with Stiefel Laboratories, Inc. for Latin America. Kerastick® sales volumes increased to 262,046 units in 2010 from 220,288 units sold in 2009. Domestic Kerastick® sales volumes increased by 49,554 units or 25% and were partially offset by a 7,796 decrease in our international sales volumes. BLU-U® revenues were relatively flat year-over-year at $1.9 million as incremental volume was fully offset by a lower average selling price. There were 270 units sold during 2010, as compared to the 252 units sold in the prior year. The decreased average selling price in 2010 is reflective of lower pricing offered to customers in advance of the introduction of the upgraded BLU-U® design which became available in April 2010. Non-PDT revenues totaled $1.0 million down $0.5 million from the prior year due to the absence of Nicomide® royalties from River’s Edge Pharmaceuticals, LLC.
DUSA’s net income on a GAAP basis for the year ended December 31, 2010 was $2.7 million or $0.11 per common share, compared to a net loss of ($2.5) million or ($0.10) per common share in 2009.
DUSA’s non-GAAP net income for the year ended December 31, 2010 was $4.2 million or $0.17 per common share in 2010, compared to a net loss of ($1.0) million or ($0.04) per common share in 2009. The improvement in the Company’s non-GAAP profitability was the result of the year-over-year increase in our PDT revenues and the recognition of $0.5 million in income from operations related to the termination of the Stiefel Agreement, both of which were partially offset by an increase in our operating costs.
As of December 31, 2010, total cash, cash equivalents, and marketable securities were $19.6 million, compared to $16.7 million at December 31, 2009. The Company generated $3.0 million in positive cash flow (change in cash and cash equivalents and marketable securities) during 2010.
Conference Call Details and Dial-in Information:
In conjunction with this announcement, DUSA will host a conference call today:
Thursday, March 3rd – 8:30 am EDT
If calling from North America use the following toll-free number:
International callers use:
Password – DUSA
A recorded replay of the call will be available approximately 15 minutes following the call.
North American callers use:
International callers use:
The call will be accessible on our website approximately six hours following the call at www.dusapharma.com.
Revenues Table, Condensed Consolidated Balance Sheets, Condensed Consolidated Statement of Operations and GAAP to Non-GAAP reconciliation follow:
Revenues for the three and twelve-month periods were comprised of the following:
DUSA Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets
DUSA Pharmaceuticals, Inc.
Consolidated Statement of Operations
Use of Non-GAAP Financial Measures
In addition to reporting financial results in accordance with GAAP, DUSA has provided in the table below non-GAAP financial measures adjusted to exclude stock-based compensation expense, consideration provided to the former Sirius shareholders, and the non-cash change in fair value of warrants. The Company believes that this presentation is useful to help investors better understand DUSA’s financial performance, competitive position and prospects for the future. Management believes that these non-GAAP financial measures assist in providing a more complete understanding of the Company’s underlying operational results and trends, and in allowing for a more comparable presentation of results. Management uses these measures along with their corresponding GAAP financial measures to help manage the Company’s business and to help evaluate DUSA’s performance compared to the marketplace. However, the presentation of non-GAAP financial measures is not meant to be considered in isolation or as superior to or as a substitute for financial information provided in accordance with GAAP. The non-GAAP financial measures used by the Company may be calculated differently from, and, therefore, may not be comparable to, similarly titled measures used by other companies.
Investors are encouraged to review the reconciliations of these non-GAAP financial measures to the comparable GAAP results, contained in the table below.
About DUSA Pharmaceuticals
DUSA Pharmaceuticals, Inc. is an integrated dermatology pharmaceutical company focused primarily on the development and marketing of its Levulan® PDT technology platform, and other dermatology products. Levulan® Kerastick® for topical solution plus DUSA’s BLU-U® Blue Light Photodynamic Therapy Illuminator is currently approved for the treatment of minimally to moderately thick actinic keratoses (AKs) of the face or scalp. DUSA also sells other dermatology products, including ClindaReach®. DUSA is based in Wilmington, Mass. Please visit our website at www.dusapharma.com.
Except for historical information, this news release contains certain forward-looking statements that represent our current expectations and beliefs concerning future events, and involve certain known and unknown risk and uncertainties. These forward-looking statements relate to management’s belief concerning market potential for its products, intention to build business, plans to initiate a clinical study, the purpose, objectives and timing for initiation of the study and possibilities for additional development and management’s beliefs concerning non-GAAP financial measures. These forward-looking statements are further qualified by important factors that could cause actual results to differ materially from future results, performance or achievements expressed or implied by those in the forward-looking statements made in this release. These factors include, without limitation, marketing of competitive products, actions by health regulatory authorities, changing economic conditions, the status of our patent portfolio, reliance on third parties, including sole source vendors, sufficient funding, and other risks and uncertainties identified in DUSA's Form 10-K for the year ended December 31, 2010.