Oculus Innovative Sciences Inc. (OCLS) filed Quarterly Report for the period ended 2009-09-30.
OCULUS INNOVATIVE SCIENCES, INC. is a biopharmaceutical company that develops, manufactures and markets a family of products based upon the Microcyn Technology platform, which is intended to help prevent and treat infections in chronic and acute wounds. The Microcyn Technology platform is a biocompatible, shelf-stable solution containing active oxychlorine compounds that is currently commercialized outside the United States (Europe, India and Mexico) for the treatment of infected wounds. The solutions derived from the Microcyn Technology platform have demonstrated, in a variety of research and investigational studies, the ability to treat a wide range of pathogens, including antibiotic-resistant strains of bacteria (including MRSA and VRE), viruses, fungi and spores. A recently completed U.S. Phase II clinical trial of Microcyn Technology met the primary endpoints of safety and efficacy for the treatment of mildly infected diabetic foot ulcers. Oculus Innovative Sciences Inc. has a market cap of $40.5 million; its shares were traded at around $1.71 with and P/S ratio of 7.5.
Highlight of Business Operations:
In the fourth quarter of 2007, we completed a Phase II randomized clinical trial, which was designed to evaluate the effectiveness of Microcyn in mildly infected diabetic foot ulcers with the primary endpoint of clinical cure or improvement in signs and symptoms of infection according to guidelines of Infectious Disease Society of America. We used 15 clinical sites and enrolled 48 evaluable patients in three arms, using Microcyn alone, Microcyn plus an oral antibiotic and saline plus an oral antibiotic. We announced the results of our Phase II trial in March 2008. In the clinically evaluable population of the study, the clinical success rate at visit four (test of cure) for patients treated with Microcyn alone was 93.3% compared to 56.3% for the Levofloxacin plus saline-treated patients. This study was not statistically powered, but the high clinical success rate (93.3%) and the p-value (0.033) would suggest the difference is meaningfully positive for the Microcyn-treated patients. Also, for this set of data, the 95.0% confidence interval for the Microcyn-only arm ranged from 80.7% to 100.0% while the 95.0% confidence interval for the Levofloxacin and saline arm ranged from 31.9% to 80.6%; the confidence intervals do not overlap, thus indicating a favorable clinical success for Microcyn compared to Levofloxacin. At visit three (end of treatment) the clinical success rate for patients treated with Microcyn alone was 77.8% compared to 61.1% for the Levofloxacin plus saline-treated patients.
Total revenues were $1,672,000 during the quarter ended September 30, 2009 compared to $1,481,000 in the prior year period. Product revenues increased $191,000 due to higher sales in Europe, US, China, India and Singapore. In local currency, product revenue growth in Mexico was 26% while it was down slightly when translated to dollars due to a 29% decrease in the value of the peso. Without the drop in the value of the peso during the quarter, product growth in Mexico would have been 26% and product growth worldwide would have been 37%. Unit sales of our 240-milliliter presentation, sold mostly to pharmacies in Mexico increased 6% over the prior year to a monthly average of 33,000 units compared to 31,000 units in the same quarter last year; unit sales to hospitals increased 38%, partially offset by lower selling prices. Europe/ROW sales increased $120,000 up 52%, over the prior year due to higher sales in Europe, China, India and Singapore. Sales in the US increased $92,000 with strong increases in human and animal wound care, related mostly to TV advertising and programs, sponsored by V&M, Industries, Inc..
We reported gross profit from our Microcyn products business of $802,000, or 57% of product revenues, during the three months ended September 30, 2009, compared a gross profit of $766,000, or 63%, in the prior year period. This decrease was primarily due to higher costs in Europe and U.S. as we were transferring our manufacturing from Europe to the US during the current quarter while sustaining costs in both locations. We also incurred shipping costs of equipment and non cash losses due to the write off of equipment and some inventory. Mexico’s margins were about the same at 79% during the quarter ended September 30, 2009, compared to 78% in the prior year period.
Total revenues were $3,519,000 during the six months ended September 30, 2009, up 31%, compared to $2,692,000 in the prior year period. The $751,000 increase in product revenues was due primarily to higher sales in the U.S., Europe and Mexico, up 34% compared to the same period last year. Without the 28% drop in the value of the peso during the six months ended September 30, 2009, product growth in Mexico would have been 61% and product growth worldwide would have been 61%. As a result of the swine flu epidemic in Mexico and normal growth, unit sales for six months ended September 30, 2009, of our 240-milliliter presentation, sold mostly to pharmacies in Mexico, increased 57% over the prior year to a monthly average of 47,000 units, up from 30,000 in the same period last year; unit sales to hospitals increased 68%, partially offset by lower selling prices. Europe/ROW sales increased $165,000, up 39%, over the prior year with higher sales from China, India and Singapore. Sales in the U.S. increased $157,000 with strong increases in human and animal wound care, related mostly to television advertising and other programs sponsored by V&M Industries, Inc.
We reported gross profit from our Microcyn products business of $1,842,000, or 62% of product revenues, during the six months ended September 30, 2009, compared to a gross profit of $1,335,000, or 60%, in the prior year period. Mexico’s margins improved to 81% during the six months ended September 30, 2009, compared to 73% in the prior year period with higher unit volume in the first quarter due the swine flu epidemic. During the six months ended September 30, 2009, gross margins in Europe and U.S. are relatively low as we are transferring our manufacturing from Europe to the U.S., sustaining costs in both locations and including severance costs in European cost of goods sold.
Rate This Article: |
  |