Durect Corp. (DRRX, Financial) filed Quarterly Report for the period ended 2012-09-30.
Durect Corporation has a market cap of $117.5 million; its shares were traded at around $1.02 with a P/E ratio of 6.1 and P/S ratio of 3.5.
We recorded $1.1 million and $41.7 million of collaborative research and development revenue for the three and nine months ended September 30, 2012, respectively, compared to $5.2 million and $15.9 million for the corresponding periods in 2011, respectively. The decrease in collaborative research and development revenue in the three months ended September 30, 2012 was primarily attributable to lower revenue recognized in connection with our agreements with Pfizer, Zogenix, Hospira, and Nycomed, partially offset by higher collaborative research and development revenue from other feasibility partners. The increase in collaborative research and development revenue in the nine months ended September 30, 2012 was primarily attributable to revenue of $35.4 million recognized as a result of the termination of our agreements with Nycomed (with respect to POSIDUR), Pfizer (with respect to ELADUR) and Hospira (with respect to POSIDUR) in the first quarter of 2012; the termination of the agreements and the related recognition of deferred revenue did not result in additional cash proceeds to us. Excluding the impact of recognition of the upfront fees from our agreements with collaborative partners in the nine months ended September 30, 2012 and 2011, collaborative research and development revenue decreased in the nine months ended September 30, 2012 due to lower revenue recognized from our agreements with Hospira, Pfizer (with respect to ELADUR) and Zogenix as the development activities for POSIDUR, ELADUR and Relday decreased in the first nine months of 2012 compared with the corresponding period in 2011, partially offset by higher collaborative research and development revenue recognized in connection with our agreements with Pfizer (with respect to Remoxy) and other feasibility partners.
A portion of our revenues is derived from our product sales, which include our ALZET mini pump product line, our LACTEL biodegradable polymer product line and certain excipients that are included in REMOXY. Net product revenues were $2.7 million and $8.1 million in the three and nine months ended September 30, 2012, respectively, compared to $2.9 million and $8.6 million for the corresponding periods in 2011, respectively. The decreases in the three and nine months ended September 30, 2012 were primarily attributable to lower product revenue from the sale of certain excipients included in REMOXY to Pfizer and from our ALZET mini pump product line as a result of fewer units sold, partially offset by higher product revenue from our LACTEL polymer product line compared to the corresponding periods in 2011. Revenues in the three and nine months ended September 30, 2012 included zero and $51,000 in product revenue related to the shipments of excipients included in REMOXY, compared to $481,000 for the corresponding periods in 2011.
Cost of product revenues. Cost of product revenues were $1.0 million and $3.6 million for the three and nine months ended September 30, 2012, respectively, compared to $1.3 million and $3.8 million for the corresponding periods in 2011, respectively. The decreases in the cost of product revenue in the three and nine months ended September 30, 2012 compared to the corresponding periods in 2011 was primarily due to lower cost of goods sold related to the sale of certain excipients to Pfizer and related to our ALZET product line arising from lower units sold, partially offset by the result of higher manufacturing costs associated with our LACTEL product line due to higher units sold. Cost of product revenue and gross profit margin will fluctuate from period to period depending upon the product mix in a particular period and unit volumes sold. Stock-based compensation expense recognized related to cost of product revenues was $60,000 and $185,000 for the three and nine months ended September 30, 2012, respectively, compared to $80,000 and $247,000 for the corresponding periods in 2011.
Selling, general and administrative. Selling, general and administrative expenses are primarily comprised of salaries, benefits, stock-based compensation and other compensation cost associated with finance, legal, business development, sales and marketing and other administrative personnel, overhead and facility costs, and other general and administrative costs. Selling, general and administrative expenses were $2.9 million and $9.2 million for the three and nine months ended September 30, 2012, respectively, compared to $3.4 million and $10.4 million in the corresponding period in 2011. The decrease in selling, general and administrative expenses was primarily due to lower employee-related costs as well as lower patent related expenses incurred in the three and nine months ended September 30, 2012 compared with the corresponding periods in 2011. Stock-based compensation expense recognized related to selling, general and administrative personnel was $338,000 and $1.1 million for the three and nine months ended September 30, 2012, respectively, compared to $592,000 and $1.7 million in the corresponding period in 2011.
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Durect Corporation has a market cap of $117.5 million; its shares were traded at around $1.02 with a P/E ratio of 6.1 and P/S ratio of 3.5.
Highlight of Business Operations:
Since our inception in 1998, we have generally had a history of operating losses. At September 30, 2012, we had an accumulated deficit of $333.8 million. Our net income was $21.7 million for the nine months ended September 30, 2012, resulting from the recognition of previously received upfront payments of $35.4 million in connection with agreements terminated by Pfizer, Hospira and Nycomed. This recognition of deferred revenue did not result in additional cash proceeds to us. Our net losses were $18.8 million, $22.9 million and $30.3 million for the years ended December 31, 2011, 2010 and 2009, respectively. These losses have resulted primarily from costs incurred to research and develop our product candidates and to a lesser extent, from selling, general and administrative costs associated with our operations and product sales. Relative to recent quarters and pending any new collaborations that may be signed, we expect a slight decrease in collaborative research and development revenue as our role in existing collaborations, for which we are reimbursed, is reduced. We expect our research and development expenses to decrease in the near future compared to recent quarters. We expect selling, general and administrative expenses to be comparable in the near future to recent quarters. We do not anticipate meaningful revenues from our pharmaceutical systems, should they be approved, for at least the next twelve months. Therefore, we expect to incur continuing losses and negative cash flow from operations for the foreseeable future.We recorded $1.1 million and $41.7 million of collaborative research and development revenue for the three and nine months ended September 30, 2012, respectively, compared to $5.2 million and $15.9 million for the corresponding periods in 2011, respectively. The decrease in collaborative research and development revenue in the three months ended September 30, 2012 was primarily attributable to lower revenue recognized in connection with our agreements with Pfizer, Zogenix, Hospira, and Nycomed, partially offset by higher collaborative research and development revenue from other feasibility partners. The increase in collaborative research and development revenue in the nine months ended September 30, 2012 was primarily attributable to revenue of $35.4 million recognized as a result of the termination of our agreements with Nycomed (with respect to POSIDUR), Pfizer (with respect to ELADUR) and Hospira (with respect to POSIDUR) in the first quarter of 2012; the termination of the agreements and the related recognition of deferred revenue did not result in additional cash proceeds to us. Excluding the impact of recognition of the upfront fees from our agreements with collaborative partners in the nine months ended September 30, 2012 and 2011, collaborative research and development revenue decreased in the nine months ended September 30, 2012 due to lower revenue recognized from our agreements with Hospira, Pfizer (with respect to ELADUR) and Zogenix as the development activities for POSIDUR, ELADUR and Relday decreased in the first nine months of 2012 compared with the corresponding period in 2011, partially offset by higher collaborative research and development revenue recognized in connection with our agreements with Pfizer (with respect to Remoxy) and other feasibility partners.
A portion of our revenues is derived from our product sales, which include our ALZET mini pump product line, our LACTEL biodegradable polymer product line and certain excipients that are included in REMOXY. Net product revenues were $2.7 million and $8.1 million in the three and nine months ended September 30, 2012, respectively, compared to $2.9 million and $8.6 million for the corresponding periods in 2011, respectively. The decreases in the three and nine months ended September 30, 2012 were primarily attributable to lower product revenue from the sale of certain excipients included in REMOXY to Pfizer and from our ALZET mini pump product line as a result of fewer units sold, partially offset by higher product revenue from our LACTEL polymer product line compared to the corresponding periods in 2011. Revenues in the three and nine months ended September 30, 2012 included zero and $51,000 in product revenue related to the shipments of excipients included in REMOXY, compared to $481,000 for the corresponding periods in 2011.
Cost of product revenues. Cost of product revenues were $1.0 million and $3.6 million for the three and nine months ended September 30, 2012, respectively, compared to $1.3 million and $3.8 million for the corresponding periods in 2011, respectively. The decreases in the cost of product revenue in the three and nine months ended September 30, 2012 compared to the corresponding periods in 2011 was primarily due to lower cost of goods sold related to the sale of certain excipients to Pfizer and related to our ALZET product line arising from lower units sold, partially offset by the result of higher manufacturing costs associated with our LACTEL product line due to higher units sold. Cost of product revenue and gross profit margin will fluctuate from period to period depending upon the product mix in a particular period and unit volumes sold. Stock-based compensation expense recognized related to cost of product revenues was $60,000 and $185,000 for the three and nine months ended September 30, 2012, respectively, compared to $80,000 and $247,000 for the corresponding periods in 2011.
Selling, general and administrative. Selling, general and administrative expenses are primarily comprised of salaries, benefits, stock-based compensation and other compensation cost associated with finance, legal, business development, sales and marketing and other administrative personnel, overhead and facility costs, and other general and administrative costs. Selling, general and administrative expenses were $2.9 million and $9.2 million for the three and nine months ended September 30, 2012, respectively, compared to $3.4 million and $10.4 million in the corresponding period in 2011. The decrease in selling, general and administrative expenses was primarily due to lower employee-related costs as well as lower patent related expenses incurred in the three and nine months ended September 30, 2012 compared with the corresponding periods in 2011. Stock-based compensation expense recognized related to selling, general and administrative personnel was $338,000 and $1.1 million for the three and nine months ended September 30, 2012, respectively, compared to $592,000 and $1.7 million in the corresponding period in 2011.
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