GlobeNewswire Inc | Aug 5, 2020 07:45AM EDT

August 05, 2020

Second Quarter Total Company Net Revenue Increased 23% versus Prior Year to $36.6 Million

Second Quarter BELBUCA Net Sales Increased 34% versus Prior Year to $32.3 Million

BELBUCA and Symproic Each Reach All Time High TRx Volume and Market Share

Conference Call and Webcast Scheduled for 8:30 AM EST Today

RALEIGH, N.C., Aug. 05, 2020 (GLOBE NEWSWIRE) -- BioDelivery Sciences International, Inc.(NASDAQ: BDSI), a rapidly growing specialty pharmaceutical company dedicated to patients living with serious and complex chronic conditions, today reported strong financial results for the second quarter ended June 30, 2020, as well as the following operational and performance highlights.

Key Business Highlights

-- Total Company net revenue for the second quarter increased by 23% versus the prior year period to $36.6 million.This growth was driven by BELBUCA netsales of $32.3 million, an increase of 34% versus the prior year period, and Symproic net sales of $3.4 million, an increase of 7% compared to the second quarter of 2019. -- Total BELBUCA prescriptions reached an all-time high of 104,687 during the second quarter, representing year-over-year prescription volume growth of 31%. -- Total Symproic prescriptions were more than 17,200 in the second quarter, representing growth of 11% versus the prior year. -- Appointed Jeffrey A. Bailey as interim Chief Executive Officer (CEO). -- Successfully adapted commercial model in response to evolving COVID-19 market conditions, which included a reduction in patient visits to physicians. This was demonstrated by robust brand performance year over year, while also tightly managing expenses to drive positive net income.

Our business has proven to be extremely resilient during the second quarter as seen with the all-time high TRx volume and market shares achieved for both BELBUCA and Symproic, stated Jeff Bailey, interim CEO of BDSI. BDSI is in the best financial position it has ever been from a cash and profitability perspective, and fundamentally the demand for BELBUCA and Symproic is strong, positioning the company well to continue supporting our commercial team with new and enhanced tools adapted for the current environment.

Second Quarter 2020 Financial Results

Total Company Net Revenue for the second quarter of 2020 was $36.6 million, an increase of 23% compared to $29.7 million in the second quarter of 2019, and a decrease of 4% compared to $38.3 million in the first quarter of 2020.

BELBUCA Net Sales for the second quarter of 2020 were $32.3 million, an increase of 34% compared to $24.1 million in the second quarter of 2019, and a decrease of 3% compared to $33.5 million in the first quarter of 2020.

Symproic Net Sales for the second quarter were $3.4 million, an increase of 7% compared to $3.2 million in the second quarter of 2019, and a decrease of 18% compared to $4.2 million in the first quarter of 2020.

BUNAVAIL Net Sales for the second quarter were $0.7 million, compared to $0.8 million in the second quarter of 2019. In March of this year, the Company announced the planned discontinuation of marketing of BUNAVAIL and ceased shipping product on June 15, 2020.

Total Operating Expenses for the second quarter of 2020 were $28.2 million, compared to $26.7 million in the first quarter of 2020 and $22.0 million in the second quarter of 2019. Second quarter costs declined $3.6 million compared to the first quarter of 2020, excluding the $5.1 million of non-recurring costs related to the CEO transition.

GAAP Net Incomefor the second quarter of 2020 was $1.2 million, or $0.01 per share, compared to GAAP net income of $5.0 million, or $0.05 per share, for the first quarter of 2020 and GAAP net loss of $11.1 million, or ($0.13) per share, in the second quarter of 2019.

EBITDA for the second quarter of 2020 was $5.1 million, or 14% of net sales, compared to $7.8 million in the first quarter of 2020 and $4.8 million in the second quarter of 2019.

Non-GAAP Net Income for the second quarter of 2020 was $9.6 million and reflects GAAP net income excluding stock-based compensation, non-cash amortization of intangible assets, non-recurring financial impact of the BUNAVAIL discontinuation and the non-recurring financial impact of the CEO transition.

Cash Position As of June 30, 2020, cash and cash equivalents were approximately $91.0 million, compared to $63.9 million at December 31, 2019, reflecting the generation of $5.0 million of positive operating cash flow and $2.5 million in proceeds from the exercise of options, together with $19.6 million of net proceeds from increasing our existing credit facility.

A very important objective through this COVID-19 pandemic has been to ensure the health and safety of our employees and the communities we serve, stated Jeff Bailey. Lastly, Id like to thank the entire BDSI team for their commitment and continued focus on meeting patient needs.

Conference Call & Webcast Details

BioDelivery Scienceswill host a conference call and webcast today,August 5, 2020, at8:30 a.m. ETto present second quarter 2020 results and to provide a business update. Dial-in details are as follows:

Date: Wednesday, August 5, 2020Time: 8:30 AM Eastern TimeDomestic: 866-248-8441International: 720-452-9102Conference ID: 9339657Webcast: http://public.viavid.com/index.php?id=141000

ABOUTBIODELIVERY SCIENCES INTERNATIONAL, INC.

BioDelivery Sciences International, Inc. (NASDAQ: BDSI) is a commercial-stage specialty pharmaceutical company dedicated to patients living with chronic conditions. BDSI has built a portfolio of products that includes utilizing its novel and proprietary BioErodible MucoAdhesive (BEMA) technology to develop and commercialize, either on its own or in partnership with third parties, new applications of proven therapies aimed at addressing important unmet medical needs. BDSI's marketed products address serious and debilitating conditions, including chronic pain and opioid-induced constipation.

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

This press release and any statements of employees, representatives, and partners ofBioDelivery Sciences International, Inc.(BDSI) related thereto contain, or may contain, among other things, certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve significant risks and uncertainties. Such statements may include, without limitation, statements with respect to BDSIs plans, objectives, projections, expectations and intentions and other statements identified by words such as projects, may, will, could, would, should, believes, expects, anticipates, estimates, intends, plans, potential or similar expressions. These statements are based upon the current beliefs and expectations of BDSIs management and are subject to significant risks and uncertainties, including those detailed in BDSIs filings with theSecurities and Exchange Commission. Actual results (including, without limitation, the continued growth in BELBUCA and Symproic net sales and total company net revenue in 2020 may differ materially from those set forth or implied in the forward-looking statements. These forward-looking statements involve certain risks and uncertainties that are subject to change based on various factors (many of which are beyond BDSIs control) including the risk that the current coronavirus pandemic impacts on our supply chain, commercial partners, patients and their physicians and the healthcare facilities in which they work, and our personnel are greater than we anticipate, as well as those set forth in our 2019 annual report on Form 10-K filed with theUS Securities and Exchange Commissionand subsequent filings. BDSI undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future presentations or otherwise, except as required by applicable law.

Non-GAAP Financial Measures

This press release includes information about certain financial measures that are not prepared in accordance with generally accepted accounting principles in the United States, or GAAP, including non-GAAP net income and EBITDA. These non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies.

Non-GAAP net income adjusts for one-time and non-cash charges by excluding the following from GAAP net income: stock-based compensation expense, amortization of intangible assets, amortization of certain warrant discount costs in second quarter 2019, and the financial impact of certain one-time items that are non-recurring, including the financial impact of the debt refinancing in second quarter 2019, the discontinuation of marketing of BUNAVAIL, and costs associated with the CEO transition.

EBITDA excludes net interest, including both interest expenses and interest income, provision for (benefit from) income taxes, depreciation and amortization.

The Company's management and board of directors utilize these non-GAAP financial measures to evaluate the Company's performance. The Company provides these non-GAAP measures of the Company's performance to investors because management believes that these non-GAAP financial measures, when viewed with the Company's results under GAAP and the accompanying reconciliations, are useful in identifying underlying trends in ongoing operations. However, non-GAAP net incomeand EBITDA are not measures of financial performance under GAAP and, accordingly, should not be considered as alternatives to GAAP measures as indicators of operating performance. Further, non-GAAP net incomeand EBITDA should not be considered measures of our liquidity.

A reconciliation of certain GAAP to non-GAAP financial measures has been provided in the tables included in this press release.

2020BioDelivery Sciences International, Inc. All rights reserved.

Contact:

Bob YedidLifeSci Advisors646-597-6989Bob@LifeSciAdvisors.com

BIODELIVERY SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(U.S. DOLLARS, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)(Unaudited)

June 30, December 2020 31, 2019ASSETS Current assets: Cash and cash equivalents $ 91,009 $ 63,888 Accounts receivable, net 48,126 38,790 Inventory, net 17,774 11,312 Prepaid expenses and other current assets 2,099 3,769 Total current assets 159,008 117,759 Property and equipment, net 1,508 2,075 Goodwill 2,715 2,715 License and distribution rights, net 56,842 60,309 Other intangible assets, net ? 47 Total assets $ 220,073 $ 182,905 LIABILITIES AND STOCKHOLDERS? EQUITY Current liabilities: Accounts payable and accrued liabilities $ 56,646 $ 53,993 Total current liabilities 56,646 53,993 Notes payable, net 78,274 58,568 Other long-term liabilities 383 580 Total liabilities 135,303 113,141 Commitments and contingencies Stockholders? equity: Preferred Stock, 5,000,000 shares authorized;Series A Non-Voting Convertible Preferred Stock.$0.001 par value, 0 and 2,093,155 sharesoutstanding at June 30, 2020 and December 31, 2019, ? 2 respectively; Series B Non-Voting ConvertiblePreferred Stock, $0.001 par value, 443 and 618shares outstanding at June 30, 2020 and December31, 2019, respectively.Common Stock, $0.001 par value; 175,000,000 sharesauthorized at June 30, 2020 and December 31, 2019,respectively; 100,916,511 and 96,189,074 shares 99 96 issued; 100,901,020 and 96,173,583 sharesoutstanding at June 30, 2020 and December 31, 2019,respectively.Additional paid-in capital 445,180 436,306 Treasury stock, at cost,15,491 shares, as of June (47 ) (47 )30, 2020 and December 31, 2019.Accumulated deficit (360,462 ) (366,593 )Total stockholders? equity 84,770 69,764 Total liabilities and stockholders? equity $ 220,073 $ 182,905

BIODELIVERY SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(U.S. DOLLARS, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)(Unaudited)

Three months ended June 30, Six months ended June 30, 2020 2019 2020 2019Revenues: Product sales $ 36,445 $ 28,056 $ 74,161 $ 47,815 Product royalty 137 1,461 700 1,471 revenuesContract revenues ? 160 ? 160 Total Revenues: 36,582 29,677 74,861 49,446 Cost of sales 5,435 4,923 10,995 8,975 Expenses: Selling, general 28,211 21,955 54,948 38,944 and administrative Total Expenses: 28,211 21,955 54,948 38,944 Income/(loss) from 2,936 2,799 8,918 1,527 operationsInterest expense, (1,693 ) (13,937 ) (2,987 ) (16,498 )netOther income, net 8 8 8 8 Income/(loss) $ 1,251 $ (11,130 ) $ 5,939 $ (14,963 )before income taxesIncome tax recovery (86 ) ? 192 ? /(provision)Net income/(loss)attributable to $ 1,165 $ (11,130 ) $ 6,131 $ (14,963 )common stockholdersBasic Weighted averagecommon stock shares 100,136,893 83,821,811 98,541,877 77,571,003 outstandingBasic earnings/ $ 0.01 $ (0.13 ) $ 0.06 $ (0.19 )(loss) per shareDiluted Weighted averagecommon stock shares 108,111,201 83,821,811 107,062,161 77,571,003 outstandingDiluted earnings/ $ 0.01 $ (0.13 ) $ 0.06 $ (0.19 )(loss) per share

BIODELIVERY SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(U.S. DOLLARS, IN THOUSANDS)(Unaudited)

Six months ended June 30 2020 2019Operatingactivities: Net income/(loss) $ 6,131 $ (14,963 )Adjustments to reconcile net income/(loss) to net cash flows from operating activitiesDepreciation and amortization 446 168 Accretion of debt discount and loan costs 142 11,374 Amortization of intangible assets 3,515 3,187 Provision for inventory obsolescence 72 149 Stock-based compensation expense 6,306 2,711 Changes in assets and liabilities: Accounts receivable (9,336 ) (11,252 )Inventories (6,534 ) (4,716 )Prepaid expenses and other assets 1,670 (110 )Accounts payable and accrued liabilities 2,617 9,078 Taxes payable (40 ) ? Net cash flows provided by/(used in) operating 4,989 (4,374 )activitiesInvesting activities: Product acquisitions ? (20,674 )Acquisitions of equipment ? (79 )Net cash flows used in investing activities ? (20,753 )Financing activities: Proceeds from issuance of common stock ? 48,000 Equity issuance costs ? (410 )Proceeds from notes payable 20,000 60,000 Proceeds from exercise of stock options 2,569 1,070 Payment on note payable ? (67,346 )Loss on refinancing of former debt ? (2,794 )Payment on deferred financing fees (437 ) ? Net cash flows provided by financing activities 22,132 38,520 Net change in cash and cash equivalents 27,121 13,393 Cash and cash equivalents at beginning of period 63,888 43,822 Cash and cash equivalents at end of period $ 91,009 $ 57,215

BIODELIVERY SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIESRECONCILIATION OF NON-GAAP METRICS(U.S. DOLLARS, IN THOUSANDS)(Unaudited)

Three Three Months Ended Months Six Months Ended June 30, Ended June30, March 31,Reconciliation ofGAAP net income/ 2020 2019 2020 2020 2019(loss) to EBITDA(non-GAAP)GAAP net income/ $ 1,165 $ (11,130 ) $ 4,966 $ 6,131 $ (14,963 )(loss)Add back/(subtract): Income tax recovery/ 86 ? (278 ) (192 ) ? (provision)Net interest expense 1,685 13,929 1,294 2,979 16,490 Depreciation and 2,159 1,981 1,802 3,960 3,356 amortizationEBITDA $ 5,095 $ 4,780 $ 7,784 $ 12,878 $ 4,883 Reconciliation ofGAAP net income/ (loss) to Non-GAAPnet income/(loss)GAAP net income/ $ 1,165 $ (11,130 ) $ 4,966 $ 6,131 $ (14,963 )(loss)Non-GAAP adjustments:Stock-based 1,364 1,569 1,520 6,305 2,712 compensation expenseAmortization of 1,734 1,898 1,781 93 3,187 intangible assetsAmortization of ? 179 ? ? 448 warrant discountNon-recurringfinancial impact of ? 11,866 ? ? 11,866 debt refinanceNon-recurringfinancial impact of 5,078 ? ? 5,078 ? CEO transitionNon-recurringfinancial impact of 295 ? ? 295 ? BUNAVAILdiscontinuationNon-GAAP net income/ $ 9,636 $ 4,382 $ 8,267 $ 17,902 $ 3,250 (loss)