- Focus remains on cost control to maximize the value of our royalty assets
- Company announces evaluation of strategic alternatives
“As the Company continues its transition into a royalty-based business, we remain committed to cost control to maximize the value of our royalty assets,” stated
Third Quarter 2023 Financial Results
Net Loss from Continuing Operations
Net loss from continuing operations was
$1.4 millionfor the quarter ended September 30, 2023, or $0.13per basic and diluted common share, compared to a net loss from continuing operations of $14.6 million, or $1.58per basic and diluted common share, for the comparable period in 2022.
License and Service Revenues from Continuing Operations
License and service revenues from continuing operations, which are revenues related to license agreements, were
$(0.1) millionfor the quarter ended September 30, 2023, compared to $0.4 millionin license and service revenue related to sales to another licensee for the third quarter of 2022.
Gross royalties totaled
$1.2 millionand $3.3 millionfor the three- and nine-month periods ended September 30, 2023, respectively, and are recognized in license and service revenues and other income. Included in these amounts are $0.8 millionand $2.3 millionof gross minimum royalty payments due under the Mayne License Agreement for the three- and nine-month periods ended September 30, 2023, respectively. The gross minimum royalty payments were accounted for as fixed consideration at net present value and allocated to the sale of our licensed products in 2022. In the current periods, the Company recognizes income only on amounts in excess of the minimum royalty amounts earned under the Mayne License Agreement. The Company’s total royalty derived gross income of $0.4 millionand $1.0 millionfor the three- and nine-month periods ended September 30, 2023, respectively, was reduced by approximately $0.4 millionin the third quarter due to product sales adjustments reported by our licensed partners, resulting in total net royalty income of less than $0.1 millionin the quarter ended September 30, 2023. Our net royalty income amounts are allocated and reported in license and service revenue and other income based on the proportion of the sales from each of our licensed products. Based on sales of licensed products, the Company recognized approximately ($0.1) millionin license and service revenues and approximately $0.1 millionin other income in the three-month period ended September 30, 2023relating to royalties.
Total Operating Expenses from Continuing Operations
Total operating expenses from continuing operations for the third quarter of 2023 were approximately
$1.7 million, a decrease of approximately $12.8 million, or approximately 88.2%, compared to the third quarter of 2022. This decrease was due to the transition of the Company’s business from a manufacturing and commercialization business to a royalty-based business with limited infrastructure.
Company Announces Evaluation of Strategic Alternatives
- The Company is also evaluating a variety of strategic alternatives that may include, but not be limited to, an acquisition, merger, other business combination, sale of assets, or other strategic transactions involving the Company. Although the Company is exploring potential strategic alternatives, there can be no assurance of a transaction, a successful outcome of these efforts, or the form or timing of any such outcome. The Company has not set a timetable for completion of this exploration process and does not intend to disclose further developments unless and until it is determined that disclosure is appropriate or necessary.
This press release by
Chief Executive Officer