SEC Filing | TherapeuticsMD Inc

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txmd-10q_20220630.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________

Commission File Number: 001-00100

THERAPEUTICSMD, INC.

(Exact name of Registrant as specified in its Charter)


Nevada	87-0233535
(State or other jurisdiction	(I.R.S. Employer Identification No.)
of incorporation or organization)

951 Yamato Road, Suite 220
Boca Raton, Florida	33431
(Address of principal executive offices)	(Zip Code)

561-961-1900

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

	Trading
Title of Each Class	symbol	Name of each exchange on which registered
Common Stock, par value $0.001 per share	TXMD	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:


Large Accelerated Filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 8, 2022, there were 9,424,892 shares of the registrant’s common stock, par value $0.001 per share, outstanding.

Table of Contents

Part I – Financial Information		Page
Item. 1.	Financial statements (unaudited)
	Consolidated Balance Sheets	1
	Consolidated Statements of Operations	2
	Consolidated Statements of Stockholders’ Deficit	3
	Consolidated Statements of Cash Flows	4
	Notes to Unaudited Consolidated Financial Statements	5
Item 2.	Management's discussion and analysis of financial condition and results of operations	19
Item 3.	Quantitative and qualitative disclosures about market risk	28
Item 4.	Controls and procedures	28
Part II – Other Information
Item 1.	Legal proceedings	28
Item 1A.	Risk factors	28
Item 2.	Unregistered sales of equity securities and use of proceeds	30
Item 3.	Defaults upon senior securities	30
Item 4.	Mine safety disclosures	30
Item 5.	Other information	30
Item 6.	Exhibits	31
Signatures		32

Part I – Financial Information

Item 1.

Financial statements

TherapeuticsMD, Inc. and Subsidiaries

Consolidated Balance Sheets

(Unaudited - in thousands, except per share data)

	June 30, 2022			December 31, 2021
Assets:
Current assets:
Cash	$	26,303		$	65,122
Restricted cash		11,250			—
Accounts receivable, net of allowance for credit losses of $1,587 and $1,334 as of June 30, 2022 and December 31, 2021, respectively		45,804			36,176
Inventory		6,150			7,622
Prepaid and other current assets		9,096			10,548
Total current assets		98,603			119,468
Fixed assets, net		710			1,199
License rights and other intangible assets, net		38,721			40,318
Right of use assets		7,914			8,234
Other non-current assets		254			253
Total assets	$	146,202		$	169,472
Liabilities and stockholders' deficit:
Current liabilities:
Current maturities of debt	$	90,780		$	188,269
Accounts payable		13,978			20,318
Accrued expenses and other current liabilities		59,228			44,304
Total current liabilities		163,986			252,891
Operating lease liabilities		7,728			8,063
Other non-current liabilities		554			2,139
Total liabilities		172,268			263,093
Commitments and contingencies (Note 9)
Stockholders' deficit:
Preferred stock, par value $0.001; 10,000 shares authorized, none issued		—			—
Common stock, par value $0.001; 12,000 shares authorized, 8,860 and 8,598 (adjusted for the 50-for-1 reverse stock split) shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively		9			9
Additional paid-in capital		962,025			957,730
Accumulated deficit		(988,100	)		(1,051,360	)
Total stockholders' deficit		(26,066	)		(93,621	)
Total liabilities and stockholders' deficit	$	146,202		$	169,472

The accompanying notes are an integral part of these consolidated financial statements.

TherapeuticsMD, Inc. and Subsidiaries

Consolidated Statements of Operations

(Unaudited - in thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Revenue, net:
Product	$	28,496		$	22,951		$	47,410		$	42,583
License and service		65			50			484			284
Total revenue, net		28,561			23,001			47,894			42,867
Cost of goods sold		4,740			4,132			9,600			8,819
Total gross profit		23,821			18,869			38,294			34,048
Operating expenses:
Selling and marketing		23,679			32,164			42,574			56,188
General and administrative		17,403			19,873			37,810			38,256
Research and development		1,580			2,011			2,980			4,061
Total operating expenses		42,662			54,048			83,364			98,505
Loss from operations		(18,841	)		(35,179	)		(45,070	)		(64,457	)
Other income (expense):
Gain on sale of business		143,384			—			143,384			—
Loss on extinguishment of debt		—			—			(8,380	)		—
Interest expense and other financing costs		(11,696	)		(7,596	)		(26,108	)		(17,823	)
Other income, net		(16	)		123			(16	)		245
Total other income (expense), net		131,672			(7,473	)		108,880			(17,578	)
Income (loss) before income taxes		112,831			(42,652	)		63,810			(82,035	)
Provision for income taxes		550			—			550			—
Net income (loss)	$	112,281		$	(42,652	)	$	63,260		$	(82,035	)
Earnings (loss) per common share, basic	$	12.83		$	(5.41	)	$	7.29		$	(11.06	)
Weighted average common shares, basic		8,750			7,881			8,682			7,416
Earnings (loss) per common share, diluted	$	12.39		$	(5.41	)	$	7.05		$	(11.06	)
Weighted average common shares, diluted		9,059			7,881			8,971			7,416
Comprehensive income (loss):
Net income (loss)	$	112,281		$	(42,652	)	$	63,260		$	(82,035	)
Other comprehensive income		—			—			—			—
Comprehensive income (loss)	$	112,281		$	(42,652	)	$	63,260		$	(82,035	)

The accompanying notes are an integral part of these consolidated financial statements.

TherapeuticsMD, Inc. and Subsidiaries

Consolidated Statements of Stockholders' Deficit

(Unaudited - in thousands)

					Additional
	Common Stock				Paid in		Accumulated
	Shares		Amount		Capital		Deficit			Total
Balance, January 1, 2022		8,598	$	9	$	957,730	$	(1,051,360	)	$	(93,621	)
Shares issued for vested restricted stock units		71		—		—		—			—
Share-based compensation		—		—		2,062		—			2,062
Net loss		—		—		—		(49,021	)		(49,021	)
Balance, March 31, 2022		8,669		9		959,792		(1,100,381	)		(140,580	)
Shares issued for rounding up of fractional shares in connection with the reverse stock split		142		—		—		—			—
Shares issued for vested restricted stock units		44		—		—		—			—
Shares issued for sale of common stock related to employee stock purchase plan		5		—		14		—			14
Share-based compensation		—		—		2,219		—			2,219
Net income		—		—		—		112,281			112,281
Balance, June 30, 2022		8,860	$	9	$	962,025	$	(988,100	)	$	(26,066	)

Balance, January 1, 2021		5,996	$	6	$	754,938	$	(878,945	)	$	(124,001	)
Shares issued for sale of common stock, net of cost		1,857		2		150,897		—			150,899
Shares issued for exercise of warrants, net of cashless exercises		10		—		50		—			50
Shares issued for vested restricted stock units		1		—		—		—			—
Share-based compensation		—		—		2,957		—			2,957
Net loss		—		—		—		(39,383	)		(39,383	)
Balance, March 31, 2021		7,864		8		908,842		(918,328	)		(9,478	)
Shares issued for sale of common stock, net of cost		3		—		163		—			163
Shares issued for exercise of warrants		12		—		228		—			228
Shares issued for exercise of options		1		—		21		—			21
Shares issued for vested restricted stock units		19		—		—		—			—
Shares issued for sale of common stock related to employee stock purchase plan		3		—		134		—			134
Share-based compensation		—		—		2,510		—			2,510
Net loss		—		—		—		(42,652	)		(42,652	)
Balance, June 30, 2021		7,902	$	8	$	911,898	$	(960,980	)	$	(49,074	)

The accompanying notes are an integral part of these consolidated financial statements.

TherapeuticsMD, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited - in thousands)

	Six Months Ended June 30,
	2022			2021
Cash flows from operating activities:
Net income (loss)	$	63,260		$	(82,035	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		2,146			2,061
Charges (credits) to provision for doubtful accounts		542			445
Inventory charge		73			502
Debt financing fees		16,971			2,681
Share-based compensation		4,281			5,467
Gain on sale of business		(143,384	)		—
Loss on extinguishment of debt		8,380			—
Other		(15	)		434
Changes in operating assets and liabilities:
Accounts receivable		(10,603	)		(1,544	)
Inventory		1,399			(83	)
Prepaid and other current assets		1,373			365
Accounts payable		(5,591	)		(6,503	)
Accrued expenses and other current liabilities		16,913			12,940
Other non-current liabilities		(675	)		358
Total adjustments		(108,190	)		17,123
Net cash used in operating activities		(44,930	)		(64,912	)
Cash flows from investing activities:
Proceeds from sale of business, net of transaction costs		142,634			—
Payment of patent related costs		(267	)		(423	)
Purchase of fixed assets		(20	)		(104	)
Net cash provided by (used in) investing activities		142,347			(527	)
Cash flows from financing activities:
Proceeds from sale of common stock, net of costs		—			151,062
Proceeds from exercise of options and warrants		—			299
Proceeds from sale of common stock related to employee stock purchase plan		14			134
Repayments of debt		(125,000	)		(50,000	)
Payment of debt financing fees		—			(5,118	)
Net cash (used in) provided by financing activities		(124,986	)		96,377
Net (decrease) increase in cash and restricted cash		(27,569	)		30,938
Cash and restricted cash, beginning of period		65,122			80,486
Cash and restricted cash, end of period	$	37,553		$	111,424
Supplemental disclosure of cash flow information:
Interest paid	$	9,137		$	14,284
Supplemental disclosure of noncash financing activities: