SAN DIEGO, April 24, 2001 (PRIMEZONE) -- Women First HealthCare, Inc. (Nasdaq:WFHC) today announced significant improvement in its operating results for the first quarter ended March 31, 2001, including pharmaceutical revenue from its core products of $5.0 million, a 146% increase over the prior year's quarter. The Company reported that the turnaround begun in last year's third quarter continued as its net loss for the first quarter dropped below $1 million for the first time. This represents a $7.0 million or 88.0% improvement from the $8.0 million loss in the comparable quarter last year. On a per-share basis, the first quarter loss narrowed to $0.05 in 2001 from $0.46 in 2000.
The Company reported first quarter 2001 total net revenue of $7.1 million as compared to $7.5 million for first quarter 2000, a 5.5% decrease. However, excluding non-recurring revenue of $1.5 million in the prior year period, total revenue grew 18.1% in 2001.
Total expenses in 2001 were $8.4 million, or 47.0%, below last year's $15.9 million as a result of the Company's ongoing efforts to more closely align expenses and revenues. Net loss for the quarter was $957,000 ($0.05 per share) as compared to a net loss of $8.0 million ($0.46 per share) in the prior period.
Net cash used in operations was $124,000 per month in first quarter 2001 compared to $2.9 million per month in first quarter 2000, a reduction of 95.7% in the monthly cash drain.
Beginning with the Company's new strategy of acquisition and in-licensing of pharmaceutical products, on a sequential basis the quarterly loss has been reduced from $2.5 million in third quarter 2000, to $1.4 million in fourth quarter 2000, to $957,000 in first quarter 2001. The average quarterly loss in the first half of 2000 under the previous co-promotion strategy was $9.3 million. The Company also reported that its Pharmaceutical Division became profitable in first quarter 2001.
Business Segments
The Company reports results in three segments as follows:
The Pharmaceutical Division recorded revenue of $5.0 million from its core products, ORTHO-EST(r) Tablets and Esclim(tm) transdermal system, an increase of 146% over the same product sales in the prior year period. Net ORTHO-EST(r) Tablets sales increased $2.8 million or 222% to $4.1 million in first quarter 2001 from $1.3 million in first quarter 2000. Net Esclim(tm) sales increased $133,000 or 16.5% to $942,000 in first quarter 2001 from $809,000 in first quarter 2000. Total pharmaceutical revenues for first quarter 2001, including service revenues, were up 42.1% from the prior year period. First quarter 2000 pharmaceutical revenue included non-recurring related party revenue of $1.5 million for the Company's co-promotion of an oral contraceptive. Gross margin increased to 70.8% in 2001 from 62.3% in 2000. The pharmaceutical segment earned $352,000 in first quarter 2001 compared to a loss of $5.4 million in the prior year period.
On April 6, 2001 the Company signed a two-year co-promotion agreement for ORTHO-EST(r) Tablets and Esclim(tm) with Essentia Pharmaceuticals that will nearly double the Company's national sales effort. A dedicated 50-member Essentia sales force will detail both products to approximately 16,000 high prescribing primary care physicians, a market segment the Company had very limited access to prior to the agreement. The Company expects to begin earning revenue under this arrangement in third quarter 2001.
The Consumer Business Division recorded net revenue for first quarter 2001 of $2.0 million, a decrease of $279,000 or 12.1% from the prior year period. The 2001 loss was $247,000 compared to a loss of $215,000 in 2000. The Consumer Business focus for 2001 is to reduce expenses and limit the loss significantly while supporting the Company's pharmaceutical products.
The Trialogue(tm) Division's focus shifted in 2001 to providing strategic marketing programs for sale to major pharmaceutical companies. Trialogue(tm) recorded no revenue in first quarter 2001 as it continues the rollout of a unique new marketing program called Integrated Marketing Platform. Trialogue(tm) revenue in 2000 was primarily related party service revenue.
Financial Position
At March 31, 2001 the Company reported cash of $9.2 million, working capital of $8.9 million and stockholders' equity of $14.2 million. The cash position is $337,000 below the year-end amount, a decrease of 3.5% for the quarter. During last year's first quarter, cash declined $8.7 million or 26.5%. The Company has no long-term debt.
Commenting on the quarter, Edward F. Calesa, chairman, president and CEO, said, "We are off to an excellent start in 2001, reaffirming our new strategy as a specialty pharmaceutical company and continuing to build on the strong progress we have made since third quarter 2000. For the third quarter in a row, we have reduced our net loss as we move closer to attaining profitability. We are particularly pleased with the results of our Pharmaceutical Division, which became profitable this quarter. Our first quarter results remain on track with our strategy and expectations and demonstrate our continuing commitment to building shareholder value."
About Women First HealthCare, Inc.
Founded in 1996, Women First HealthCare, Inc. is a San Diego-based specialty pharmaceutical company. Its mission is to help midlife women make informed choices regarding their health care needs and to provide pharmaceutical and lifestyle products to meet those needs. Women First is specifically targeted to women age 40+ and their clinicians. The Company's Pharmaceutical Division, which includes a nationwide team of experienced sales specialists, contacts primarily OB/GYNs and Nurse Practitioners with estrogen replenishment options-ORTHO-EST(r) Tablets (estropipate) and Esclim(tm) (estradiol transdermal system). The Consumer Business is responsible for Daily Difference(tm) dietary supplements, developed in consultation with Tufts University School of Nutrition Science and Policy, and the Company's line of self-care products available through its As We Change(r) national mail order catalog and Internet retailer, www.aswechange.com. Trialogue(tm), the Corporate Marketing Division, is responsible for providing access to Women First's network of opinion leaders and clinicians through strategic marketing programs for sale to major pharmaceutical companies. The Company's business strategy includes the acquisition and licensing of additional prescription products that support its mission. Further information about Women First can be found online at www.womenfirst.com.
The most commonly reported side effects of ORTHO-EST(r) and Esclim(tm) are those typical of estrogen replenishment therapy: breast tenderness, headache, nausea and abdominal pain. Estrogens have been reported to increase the risk of endometrial carcinoma in postmenopausal women. Estrogens are contraindicated in patients with known or suspected pregnancy, undiagnosed abnormal genital bleeding, known or suspected breast cancer, known or suspected estrogen-dependent neoplasia, or active thrombophlebitis or thromboembolic disorders. For more information about these products or to see the package insert, please visit www.womenfirst.com, Rx Products area.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to various risks, and Women First HealthCare, Inc. cautions you that any forward-looking information is not a guarantee of future performance. Women First HealthCare, Inc. disclaims any intent or obligation to update these forward-looking statements. Actual results could differ materially due to a number of factors, including (i) we have incurred significant losses since we were founded in November 1996, and if midlife women do not use, and their clinicians do not recommend, the products we offer, we will continue to experience significant losses; (ii) there is a limited market awareness of our Company and the products and services we offer; (iii) we may need additional financing in 2001 to fund our operations, acquire new products, and make planned capital expenditures, which financing may not be available on acceptable terms, if at all; (iv) we may not be able to identify appropriate licensing, co-promotion or acquisition candidates in the future or to take advantage of the opportunities we identify; (v) we are obligated to find replacement sources of supply of ORTHO-EST(r) Tablets before April 2002, and if we fail to do so we will be required to pay significantly higher prices for product acquired from Ortho-McNeil Pharmaceutical; (vi) we and our products face significant competition; (vii) if we do not successfully manage any growth we experience, we may experience increased expenses without corresponding revenue increases; (viii) we are dependent on single sources of supply for all of the products we offer; and (ix) additional factors set forth in the Company's Securities and Exchange Commission filings including its Annual Report on Form 10-K for the period ended December 31, 2000.
TABLES TO FOLLOW
Women First HealthCare, Inc.
Consolidated Balance Sheets
March 31, December 31,
2001 2000
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Assets
Current assets:
Cash and cash equivalents $ 9,170,654 $ 9,507,865
Accounts receivable, net 1,739,330 421,435
Inventory 854,151 1,387,872
Receivable from related party 2,682,468
Prepaid expenses and
other current assets 685,608 544,283
------------ ------------
Total current assets 12,449,743 14,543,923
Property and equipment, net 1,050,230 1,081,214
Intangible assets, net 3,150,259 3,266,840
Other assets 1,049,614 1,152,398
------------ ------------
Total assets $ 17,699,846 $ 20,044,375
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Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 1,198,060 $ 1,052,322
Payable to related party 266,161 992,745
Accrued salaries
and employee benefits 535,352 750,902
Other accrued liabilities 1,511,809 2,213,245
------------ ------------
Total current liabilities 3,511,382 5,009,214
Commitments
Stockholders' equity:
Preferred stock -- --
Common stock 17,686 17,593
Treasury stock (99,660) (99,660)
Additional paid-in capital 80,875,525 80,794,541
Deferred compensation (202,722) (231,682)
Accumulated deficit (66,402,365) (65,445,631)
------------ ------------
Total stockholders' equity 14,188,464 15,035,161
------------ ------------
Total liabilities
and stockholders' equity $ 17,699,846 $ 20,044,375
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Women First HealthCare, Inc.
Consolidated Statements of Operations
Three months ended
March 31,
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2001 2000
------------ ------------
Net product revenue $ 7,064,423 $ 4,359,159
Net service revenue -- 200,000
Net service revenue
from related party 43,843 2,960,009
------------ ------------
Total service revenues 43,843 3,160,009
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Total net revenues 7,108,266 7,519,168
Costs and expenses:
Cost of sales 2,457,691 2,325,711
Marketing and sales 4,236,069 10,915,823
General and administrative 1,602,470 2,390,542
Research and development 124,187 269,282
------------ ------------
Total costs and expenses 8,420,417 15,901,358
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Loss from operations (1,312,151) (8,382,190)
Interest and other income, net 355,417 383,776
------------ ------------
Net loss $ (956,734) $ (7,998,414)
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Net loss per share
(basic and diluted) $ (0.05) $ (0.46)
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Weighted average shares
used in computing
net loss per share
(basic and diluted) 17,610,439 17,371,465
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CONTACT: Women First HealthCare, Inc.
Charles M. Caporale, Vice President/CFO
(858) 509-3806
ccaporale@womenfirst.com
Diane Donohue, Manager, Public Relations
(858) 509-3860
ddonohue@womenfirst.com*T