TherapeuticsMD Announces Third Quarter 2022 Financial Results

By: TherapeuticsMD, Inc. via Business Wire

November 14, 2022 at 16:05 PM EST

- Q3 total revenue of $20.9 million -

- ANNOVERA TRx growth of 10% year-over-year -

- Reduced operating expenses by $22 million year-over-year -

TherapeuticsMD, Inc. (“TXMD” or the “Company”) (NASDAQ: TXMD), an innovative, leading women’s healthcare company, today reported financial results for the third quarter ended September 30, 2022.

“Our products continue to be adopted by healthcare providers and patients, and we continue to believe that they represent a significant opportunity. Our prescriber bases grew, and we added around 1,500 new prescribers for ANNOVERA and around 1,600 for IMVEXXY. Total quarterly prescriptions for both products remained relatively stable compared to the second quarter of 2022, and ANNOVERA’s total prescriptions grew 10% compared to the third quarter of 2021. While our third quarter 2022 net revenues declined $4.5 million compared with the prior year, through disciplined cost control measures, we were able to reduce our operating expenses by $22 million year-over-year,” said Mark Glickman, co-Interim-CEO of TherapeuticsMD.

“During the quarter, we were able to move past the inventory issues we experienced in the first half of the year, and our wholesale network is now fully stocked. With these developments and the recent cash infusion from Rubric Capital, we believe our operations have stabilized, and we continue on our path forward toward our goal of meeting the demand for our products and helping to advance women’s health,” added Glickman. “Our Board of Directors and management team continue to actively assess strategic alternatives to strengthen the Company’s long-term financial position.” concluded Glickman.

Third Quarter 2022 Financial Results and Business Highlights

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Product revenue:
ANNOVERA	$	10,415	$	11,807	$	37,196	$	30,112
IMVEXXY		6,947		8,016		20,583		24,866
BIJUVA		2,663		3,298		7,877		7,899
Prescription vitamin		892		1,335		2,671		4,162
Product revenue, net		20,917		24,456		68,327		67,039
License and service revenue		—		950		484		1,234
Total revenue, net	$	20,917	$	25,406	$	68,811	$	68,273

ANNOVERA^® (segesterone acetate and ethinyl estradiol vaginal system)

ANNOVERA net product revenue of $10.4 million for the third quarter of 2022 decreased by $1.4 million compared to $11.8 million for the third quarter of 2021.
Approximately 9,200 ANNOVERA prescriptions were dispensed to patients during the third quarter of 2022.
Over 15,000 healthcare providers (HCPs) prescribed ANNOVERA since launch through the third quarter of 2022, of which more than 1,500 were new writers.

IMVEXXY^® (estradiol vaginal inserts)

IMVEXXY net product revenue of $6.9 million for the third quarter of 2022 decreased by $1.1 million compared to $8.0 million for the third quarter of 2021.
Approximately 91,300 IMVEXXY prescriptions were dispensed to patients during the third quarter of 2022.

BIJUVA^® (estradiol and progesterone) capsules

BIJUVA net product revenue of $2.7 million for the third quarter of 2022 decreased by approximately $0.6 million compared to $3.3 million for the third quarter of 2021.
BIJUVA net product revenue for the third quarter of 2022 includes $0.4 million of export sales through our international licensing and supply agreement with Theramex HQ UK Limited.

Cost of Goods Sold and Gross Margin

Cost of goods was $3.8 million with product gross margin of 82% for the third quarter of 2022 compared to $5.3 million with product gross margin of 78% for the third quarter of 2021. The increase in product gross margins was mainly due to changes in product sales mix.

Operating Expense, Net Loss and Related Information

Total operating expense of $37.9 million for the third quarter of 2022 decreased by approximately $22.2 million compared to $60.0 million for the third quarter of 2021.
Net loss for the third quarter of 2022 was $29.0 million, or $3.13 per basic and diluted share, compared to net loss for the third quarter of 2021 of $47.4 million, or $5.62 per basic and diluted share.

Balance Sheet

As of September 30, 2022, the Company’s cash on hand totaled $27.1 million, compared with $65.1 million as of December 31, 2021. Subsequent to quarter end, the Company closed a $7 million private investment in the Company’s Series A Preferred Stock from Rubric Capital Management LP. The Company also had $11.3 million in restricted cash related to customary holdbacks as part of the vitaCare Prescription Services divestiture.
As of September 30, 2022, the Company’s aggregate balance of net debt, lender warrants derivative liability, make-whole payment derivative liability and mandatory redeemable preferred stock was $117.1 million.

In light of the Company’s ongoing strategic alternatives process, the Company will not be hosting a conference call.

Please see the Full Prescribing Information, including indication and Boxed WARNING, for each TherapeuticsMD product as follows:

IMVEXXY (estradiol vaginal inserts) at https://imvexxy.com/pi.pdf
BIJUVA (estradiol and progesterone) capsules at https://www.bijuva.com/pi.pdf
ANNOVERA (segesterone acetate and ethinyl estradiol vaginal system) at www.annovera.com/pi.pdf

Forward-Looking Statements

This press release by TherapeuticsMD, Inc. may contain forward-looking statements. Forward-looking statements may include, but are not limited to, statements relating to TherapeuticsMD’s objectives, plans and strategies as well as statements, other than historical facts, that address activities, events or developments that the company intends, expects, projects, believes or anticipates will or may occur in the future. These statements are often characterized by terminology such as "believes," "hopes," "may," "anticipates," "should," "intends," "plans," "will," "expects," "estimates," "projects," "positioned," "strategy" and similar expressions and are based on assumptions and assessments made in light of management’s experience and perception of historical trends, current conditions, expected future developments and other factors believed to be appropriate. Forward-looking statements in this press release are made as of the date of this press release, and the company undertakes no duty to update or revise any such statements, whether as a result of new information, future events or otherwise. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, many of which are outside of the company’s control. Important factors that could cause actual results, developments and business decisions to differ materially from forward-looking statements are described in the sections titled "Risk Factors" in the company’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, as well as reports on Form 8-K, and include the following: whether the company will be able to refinance the indebtedness under its term loan facility, and, if not, whether the company will be able to continue as a going concern; whether the company will be able to raise capital to fund its operations; whether and how the executive order on contraception is implemented; the effects of the COVID-19 pandemic; the company’s ability to maintain or increase sales of its products; the company’s ability to develop and commercialize IMVEXXY®, ANNOVERA®, and BIJUVA® and obtain additional financing necessary therefor; the effects of supply chain issues on the supply of the company’s products; the potential of adverse side effects or other safety risks that could adversely affect the commercialization of the company’s current or future approved products or preclude the approval of the company’s future drug candidates; the company’s ability to protect its intellectual property; the length, cost and uncertain results of future clinical trials; the company’s reliance on third parties to conduct its manufacturing, research and development and clinical trials; the ability of the company’s licensees to commercialize and distribute the company’s products; the ability of the company’s marketing contractors to market ANNOVERA; the availability of reimbursement from government authorities and health insurance companies for the company’s products; the impact of product liability lawsuits; the influence of extensive and costly government regulation; the impact of leadership transitions; and the volatility of the trading price of the company’s common stock.

- Financial Statements to Follow -

TherapeuticsMD, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited - in thousands, except per share data)


	September 30, 2022			December 31, 2021
Assets:
Current assets:
Cash	$	27,080		$	65,122
Restricted cash		11,250			—
Accounts receivable, net of allowance for credit losses of $1,621 and $1,334 as of September 30, 2022 and December 31, 2021, respectively		32,157			36,176
Inventory		6,701			7,622
Prepaid and other current assets		10,290			10,548
Total current assets		87,478			119,468
Fixed assets, net		551			1,199
License rights and other intangible assets, net		37,876			40,318
Right of use assets		7,749			8,234
Other non-current assets		253			253
Total assets	$	133,907		$	169,472
Liabilities and stockholders' deficit:
Current liabilities:
Debt, net	$	93,602		$	188,269
Lender Warrants derivative liability		2,058			—
Make-whole payment derivative liability		1,751			—
Mandatory Redeemable Preferred Stock		19,709			—
Accounts payable		13,383			20,318
Accrued expenses and other current liabilities		43,568			44,304
Total current liabilities		174,071			252,891
Operating lease liabilities		7,553			8,063
Other non-current liabilities		554			2,139
Total liabilities		182,178			263,093
Commitments and contingencies
Stockholders' deficit:
Preferred stock, par value $0.001; 10,000 shares authorized, 22 issued
and included in liabilities due to their redemption provisions		—			—
Common stock, par value $0.001; 12,000 shares authorized, 9,467 and 8,598 (adjusted for the 50-for-1 reverse stock split) shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively		9			9
Additional paid-in capital		968,785			957,730
Accumulated deficit		(1,017,065	)		(1,051,360	)
Total stockholders' deficit		(48,271	)		(93,621	)
Total liabilities and stockholders' deficit	$	133,907		$	169,472

TherapeuticsMD, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited - in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Revenue, net:
Product	$	20,917		$	24,456		$	68,327		$	67,039
License and service		—			950			484			1,234
Total revenue, net		20,917			25,406			68,811			68,273
Cost of goods sold		3,788			5,282			13,388			14,101
Total gross profit		17,129			20,124			55,423			54,172
Operating expenses:
Selling and marketing		19,129			30,005			61,703			86,193
General and administrative		17,635			28,435			55,445			66,691
Research and development		1,112			1,605			4,092			5,666
Total operating expenses		37,876			60,045			121,240			158,550
Loss from operations		(20,747	)		(39,921	)		(65,817	)		(104,378	)
Other (expense) income:
Gain on sale of business		—			—			143,384			—
Expense for accretion of Mandatory Redeemable Preferred Stock		(3,457	)		—			(3,457	)		—
Fair value loss on Lender Warrants derivative liability		(76	)		—			(76	)		—
Loss on extinguishment of debt		—			—			(8,380	)		—
Interest expense and other financing costs		(4,833	)		(7,518	)		(30,941	)		(25,341	)
Other (expense) income, net		(112	)		19			(128	)		264
Total other (expense) income, net		(8,478	)		(7,499	)		100,402			(25,077	)
(Loss) income before income taxes		(29,225	)		(47,420	)		34,585			(129,455	)
(Benefit) provision for income taxes		(260	)		—			290			—
Net (loss) income	$	(28,965	)	$	(47,420	)	$	34,295		$	(129,455	)
(Loss) earnings per common share, basic	$	(3.13	)	$	(5.62	)	$	3.86		$	(16.68	)
Weighted average common shares, basic		9,261			8,444			8,877			7,762
(Loss) earnings per common share, diluted	$	(3.13	)	$	(5.62	)	$	3.73		$	(16.68	)
Weighted average common shares, diluted		9,261			8,444			9,205			7,762

TherapeuticsMD, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited - in thousands)


	Nine Months Ended September 30,
	2022			2021
Cash flows from operating activities:
Net income (loss)	$	34,295		$	(129,455	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		3,181			3,091
Charges to provision for doubtful accounts		542			540
Inventory charge		73			1,082
Debt financing fees		20,053			4,158
Share-based compensation		8,587			12,779
Gain on sale of business		(143,384	)		—
Expense for accretion of Mandatory Redeemable Preferred Stock		3,457			—
Loss on extinguishment of debt		8,380			—
Other		50			726
Changes in operating assets and liabilities:
Accounts receivable		3,044			(5,560	)
Inventory		848			(451	)
Prepaid and other current assets		180			(2,831	)
Accounts payable		(6,186	)		(1,476	)
Accrued expenses and other current liabilities		3,705			13,504
Other non-current liabilities		(675	)		758
Total adjustments		(98,145	)		26,320
Net cash used in operating activities		(63,850	)		(103,135	)
Cash flows from investing activities:
Proceeds from sale of business, net of transaction costs		142,634			—
Payment of patent related costs		(297	)		(675	)
Purchase of fixed assets		(21	)		(34	)
Net cash provided by (used in) investing activities		142,316			(709	)
Cash flows from financing activities:
Proceeds from sale of Mandatory Redeemable Preferred Stock, net of costs		16,252			—
Proceeds from make-whole derivative		1,751			—
Proceeds from sale of common stock, net of costs		2,454			182,881
Proceeds from exercise of options and warrants		—			302
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		(729	)		(5,118	)
Net cash (used in) provided by financing activities		(105,258	)		128,199
Net (decrease) increase in cash and restricted cash		(26,792	)		24,355
Cash and restricted cash, beginning of period		65,122			80,486
Cash and restricted cash, end of period	$	38,330		$	104,841
Supplemental disclosure of cash flow information:
Interest paid	$	8,371		$	19,675
Supplemental disclosure of noncash financing activities:
Paid in kind ("PIK") interest with corresponding increase in debt	$	2,452		$	—
PIK debt financing fees with corresponding increase in debt	$	16,980		$	—
Issue of warrants to lenders related to debt financing fees	$	1,983		$	—

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Contacts

Michael C. Donegan

Interim Chief Financial Officer,

Chief Accounting Officer and

Vice President Finance

561-961-1900

Lisa M. Wilson

In-Site Communications, Inc.

212-452-2793

lwilson@insitecony.com