Exhibit 99.1
FOR IMMEDIATE RELEASE
Contact: Adam C. Derbyshire Mike Freeman
Vice President and Director, Investor Relations and
Chief Financial Officer Corporate Communications
919 862-1000 919 862-1000
SALIX PHARMACEUTICALS REPORTS FIRST
QUARTER 2001 FINANCIAL RESULTS
RALEIGH, NC, May 1, 2001 - Salix Pharmaceuticals, Ltd. (Nasdaq:SLXP) today
announced operating results for the first quarter of 2001. The Company reported
a net loss of $3.9 million ($0.28 per share) for the first quarter of 2001. This
compares to a net loss of $0.7 million ($0.06 per share) for the first quarter
of 2000. Product revenues for the first quarter of 2001 were $3.3 million.
Product revenues were derived from sales of COLAZAL(TM), the Company's new
first-line therapy for the treatment of mildly to moderately active ulcerative
colitis. Cost of sales was $0.8 million for the period and gross margin was 76
percent.
Cash, cash equivalents and investments were $6.3 million on March 31, 2001.
During the first quarter of 2001 the Company secured a $7 million working
capital line of credit facility.
Operating expenses were $7.0 million for the first quarter of 2001, compared to
$1.2 million for the prior year period. Higher operating expenses for the first
three months of 2001 were due primarily to costs associated with the deployment
of the Company's sales force and marketing campaign for the launch of COLAZAL.
Selling, general and administrative expenses were $5.6 million for the first
quarter of 2001, compared to $0.6 million for the first quarter of 2000.
Research and development expenses were $1.4 million for the first quarter of
2001, compared to $0.6 million for the first quarter of 2000.
Other revenues and expenses for the period primarily related to the recognition
of deferred revenues associated with a payment received during the second
quarter of 2000 from Shire Pharmaceuticals Group plc for the sale of
intellectual property in European countries related to balsalazide disodium. As
a result of this transaction, the Company recognized deferred revenue of $1.4
million and expense related to this deferred revenue of $0.7 million during the
first quarter of 2001.
Commenting on the quarter, Robert Ruscher, President and Chief Executive
Officer, Salix Pharmaceuticals, stated, "We are extremely pleased with the
ongoing progress of the Company and, in particular, with the reception COLAZAL
is receiving in the marketplace. In preparation for the launch of COLAZAL, in
December 2000 we sold product orders totaling approximately $5.5 million to
wholesalers for distribution to pharmacies nationwide. Our 30-member
gastroenterology specialty sales force began introducing the product to
physicians in late January 2001. During the first quarter of 2001 we achieved
COLAZAL sales of over $3 million. We believe that this level of sales represents
a very solid beginning for our first product and we look forward to growing our
revenues as our sales force continues to introduce COLAZAL to
gastroenterologists across the United States."
Adam Derbyshire, Vice President, Finance and Administration, and Chief Financial
Officer, Salix Pharmaceuticals, commented on the first quarter of 2001, "During
the period the Company continued to gain visibility in the investment community
and made strides in its efforts to increase shareholder value. On February 26,
the Company moved from the Nasdaq SmallCap Market to the Nasdaq National Market.
This move comes as a result of the Company's growth and subsequent increase in
market capitalization. We anticipate our inclusion in the Nasdaq National Market
will result in increased exposure to and interest from a broader universe of
investors. In March, UBS Warburg LLC initiated research coverage on Salix. In
April, the Company presented at the Robinson-Humphrey Institutional Conference.
The ongoing success of the Company was reflected in the continued increase in
the Company's stock price - increasing 33 percent from $11.25 at the beginning
of the quarter to close the quarter at $15.00."
The current reported First Call analysts' consensus loss per share estimate for
Salix is $0.56 for 2001. Such analysts' average estimate of Salix product
revenue for the full year 2001 is $24.8 million. At this time, Salix believes
these projections are attainable based upon information currently available to
the Company. The Company's business is subject to risk factors that might cause
actual results to vary, as outlined in the Company's Form 10-K and other
publicly filed documents.
The Company will host a conference call at 10:00 a.m. EDT on May 1, 2001 to
discuss the subjects of this press release. Interested parties may access the
conference call by way of webcast or telephone. The live webcast will be
available at http://www.salixpharm.com. To access the live webcast, log on to
the Company's web site at the address listed above and go to the investor
information section. The webcast will be archived on the Company's web site
through May 8.
The telephone numbers to access the conference call are (800) 946-0782
(domestic) or (719) 457-2657 (international.) A replay of the call will be
available from 1:00 p.m. EDT, May 1 through May 8. The telephone numbers to
access the replay of the call are (888) 203-1112 (domestic) or (719) 457-0820
(international.) The pass code for the replay is 478646.
Salix Pharmaceuticals, Ltd., headquartered in Raleigh, North Carolina, develops
and markets prescription pharmaceutical products for the treatment of
gastrointestinal diseases. Salix's strategy is to in-license proprietary
therapeutic drugs that have an existing database of positive, late-stage
clinical data; complete the development and regulatory submission of these
products; and market them through the Company's gastroenterology specialty sales
force. Salix's lead product is COLAZAL(TM), an anti-inflammatory drug approved
for the treatment of mildly to moderately active ulcerative colitis. The Company
launched the product in the U.S. through its specialty sales force in January
2001. Salix's follow-on product candidate is rifaximin, currently in development
for the potential treatment of infections of the lower gastrointestinal tract.
The Company currently intends to submit an NDA for rifaximin for the treatment
of infectious diarrhea to the U.S. FDA in late 2001. Salix trades on the Nasdaq
National Market under the ticker symbol "SLXP."
For more information please contact the Company at 919-862-1000 or visit our web
site at www.salixpharm.com.
Table follows
Salix Pharmaceuticals, Ltd.
Condensed Consolidated Statement of Operations
Unaudited
(In thousands, except per share data)
Three Months Ended
March 31, March 31,
2001 2000
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Product Revenues and Costs:
Product Sales $ 3,290 $ 380
Cost of Sales 786 313
------------- ------------------
Gross Margin 2,504 67
Operating Expenses:
Research and Development 1,435 570
Selling, General and Administrative 5,558 644
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Total Operating Expenses 6,993 1,214
Loss from operations (4,489) (1,147)
Other Revenues and Expenses:
Other Revenue 1,375 467
Other Expense 891 22
Interest Income/(Expense), net 108 20
------------- ------------------
Net loss before tax (3,897) (682)
Income tax - -
------------- ------------------
Net loss $ (3,897) $ (682)
Net loss per share $ (0.28) $ (0.06)
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Weighted average shares outstanding 13,711 10,610
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Salix Pharmaceuticals, Ltd.
Condensed Consolidated Balance Sheets
(In thousands)
March 31, December 31,
2001 2000
(unaudited) (audited)
--------------- ------------------
Assets
Cash and Cash Equivalents $ 6,311 $ 13,244
Accounts Receivable 9,044 6,156
Inventory 3,642 2,819
Other Assets 2,718 3,542
--------------- ------------------
Total Assets $ 21,715 $ 25,761
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Liabilities & Stockholders' Equity
Accounts Payable and Other Current
Liabilities $ 5,246 $ 4,532
Deferred Revenue 6,959 8,487
--------------- ------------------
Total Current Liabilities 12,205 13,019
Common Stock 41,793 41,128
Accumulated Deficit (32,283) (28,386)
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Total Stockholders' Equity 9,510 12,742
--------------- ------------------
Total Liabilities & Equity $ 21,715 $ 25,761
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Please Note: This press release contains forward-looking statements
regarding future events. These statements are just predictions and are
subject to risks and uncertainties that could cause the actual events or
results to differ materially. These risks and uncertainties include the
uncertainty of market acceptance of COLAZAL and rifaximin, our limited
sales and marketing experience, timing of customer purchases, our ability
to manage growth, risks of clinical trials and regulatory review, and the
need to acquire new products. The reader is referred to the documents
that the Company files from time to time with the Securities and Exchange
Commission.