Well, we will have to sleep until the report. Interesting action today. Usually I find that if the stock settles lower the day prior to earnings, that is a good thing. We were down most of the day slightly, rose at the end, and had a relatively big sale of nearly 7,000 share that brought it down.
I'm on the record for 76 cents in profits and 62.5 mil in sales.
The cc should be interesting if they tell us anything about future products.
Listened to the cc. They, as always, sounded confident. They are looking forward to realizing the pipeline they have built.
Profits were off because of r&d, as a couple or more of trials needed to be expensed - they suggested that it was an unusually high amount, although they expect to have continued increased expenses and another trial expense starting this quarter, but it was still a high amount and this quarter will not be as high. They also had high advertising expenses and new agents employed.
They expect the mystery product to be introduced in May (delayed again by a month), and another anda approval in the fourth quarter. They do not expect the PAR partnership anda to be approved by July 30th, and gave very little info. But there was some technical dialogue about it which indicates to me that they believe that there is money to be made in it.
There was some interesting discussion on flonase. It may have been used in the cold season to treat colds, which would indicate the increased sales (a nice suprise uptick). There was also some discussion between an analyst (Needham?) and David Seltzer expressing some frustration (mostly by the analyst) that flonase should be a drug that has a higher price. The analyst even suggested that HITK increase the price in the expectation that others would follow. I think you need some event - a shortage cause by increased demand or by one of the suppliers being knocked out for some period. Hitk does expect continued weakness on price, but that it will be offset by efficiencies and related cost decreases (an new mahcine, but that is a delayed intro along with the unidose new machine with is also delay until next quarter - too many delays).
This was always, in my mind, going to be a tough year. I had hoped that flonase would get through another year before new competition, but that was not meant to be. And I hoped that the PAR partnership was going to set up a nice next year, but that is not meant either.
I made a mistake. I said that they expected an approval of an anda by the end of the fourth quarter - it should have been the end of the 1st quarter of the next fiscal year (i.e., July, 2013).
I also did not mention the hire for the head of ECR. I don't have the name handy, but the Needham analyst was very impressed by him. Said that he must have ambitions that are greater than running a $20 million per year company.
They are out. 43 cents in profit and 64.3 mil in sales. The sales number is very good. The profits are down, but they are down because they spent nearly 6 million on r&d, when last year and last quarter it was just over 3 million - if it was the same as last year/last quarter they would have been close to the market's prediction. We will see if this is a reason for a sell off, or a reason for looking forward. They have doubled the amount of applications/development at least in market target over the last year, and they need to start producing.
Flonase was a little better than expected, at least in my opinion. 23 million compared to last year's 21.8. I expected a little less. Maybe this augers well for next quarter as there seems to be increased demand despite more competition.
I am a little disappointed that tusselcaps didn't sell a little better, but I may be wrong in interpreting the numbers.
It will be an interesting day. Will the market care more about sales (which are really very nice), or profits, or convinced that all this r&d is going to pay off (it did with flonase). I will add this - they hired a person to handle r&d about a year and a half ago. He is spending money. He must produce. But he hasn't sold any of his options, at least of yet.
By the way, although I don't go on the cc's, these are the questions I would like answered:
We have seen the number of applications before the fda go up steadily - from about 12 representing about $1 billion in targeted markets, to about 15 representing about $2.5 in target sales, as well as 20 development products representing $3.8 billion. When will we see these actually approved and marketed, as we really haven't had any approvals of late.
Is the partnership with PAR going to be ready for FDA approval and marketing in July as originally anticipated?
You have often mentioned that there are patents expiring over the next 5 years representing $5 billion or so of market. But the numbers described above represent over $6 billion. Are there drugs that you haven't made application for or are not being otherwise developed at this moment that are not included in that $5 billion figure, and can you estimate that amount?
I had posted these questions previously. I also have another question - they have 8 products with "partners" (4 are pending applications, 4 are in development). We only know that PAR is a partner on one of the them. I wonder who the other partners are?? Possible TEVA. Although I have always speculated that there is some type of relationship between the two, I actually tend to doubt that they are a partner on more than one or two, if that many. I truly doubt that they would answer this question, and wouldn't even ask it if I could, but it is an interesting question (at least imho).