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Apricus' Loss Narrows in Q4

Zacks Equity Research

Although fourth quarter earnings season is coming to a close, a few companies are yet to report their results. Earlier this week, Apricus Biosciences, Inc. (APRI) reported its fourth quarter results.

Apricus posted a loss of 5 cents per share, narrower than the Zacks Consensus Estimate of a loss of 6 cents per share and far better than the year-ago loss of 25 cents per share.

Fourth quarter revenues were $0.4 million, down 84.8% from the year-ago quarter. Revenues missed the Zacks Consensus Estimate of $2 million.

In 2013, Apricus reported a loss of 50 cents per share, narrower than the year-ago loss of 64 cents per share and the Zacks Consensus Estimate of a loss of 51 cents per share.

Revenues were $2.5 million in 2013, down 68.4% from the previous year. Revenues missed the Zacks Consensus Estimate of $4 million. The fall in revenues was primarily due to lower contract services revenues related to the former French subsidiaries in the 2013 and the timing of up-front license fees related to Vitaros for the treatment of erectile dysfunction (ED).

Quarterly Details

R&D expenses increased 7.7% year over year to $1.3 million. G&A expenses decreased 38.2% year over year to $3.1 million.

Apricus is developing a second-generation Vitaros (Room Temperature Vitaros), in which alprostadil will be stored separately from the ingredients that cause it to become unstable at room temperature and will be mixed immediately prior to use. This will extend the shelf-life for Vitaros to up to 36 months (currently approved shelf-life is 18 months) and will also not require refrigeration. The study is expected to be completed by mid-2014 and the company plans to launch the second-generation Vitaros in Europe in early 2016.

Meanwhile, under regulatory guidance from the U.S. Food and Drug Administration (:FDA) and the EU regulatory authorities, Apricus is planning to advance Femprox to phase III studies for the treatment of female sexual interest/arousal disorder (:FSIAD). The company intends to seek partnerships for the development and commercialization of Femprox in Europe, while it will retain commercial rights on Femprox in the U.S.

2014 Guidance

The potential out-licensing of Femprox in 2014 should generate cash for Apricus. The company expects to start earning royalties from its partners’ Vitaros sales by late 2014. A major portion of the expenses incurred by the company will be allotted for pipeline development.

Apricus currently carries a Zacks Rank #3 (Hold). Some better ranked stocks in the health care sector include Lannett Company, Inc. (LCI), Questcor Pharmaceuticals, Inc. (QCOR) and Shire plc (SHPG). All these stocks carry a Zacks Rank #1 (Strong Buy).

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