Los Angeles, CA -(BusinessWire)- Targeted Medical Pharma, Inc. (OTCQB: TRGM), a biotechnology company that develops and distributes prescription medical foods, convenience kits and generic pharmaceuticals to physicians and pharmacies, recently announced financial results for its first quarter ended March 31, 2013. The Company posted record quarterly revenue of $2.811 million for the first quarter ended March 31, 2013, compared to revenue of $1.375 million for the first quarter ended March 31, 2012, an increase of 104.4 percent.
“I am thrilled to report the Company’s strongest recorded quarterly revenue as we continue to execute on our growth strategy,” commented William Shell, M.D., Chief Executive Officer and Chief Science Officer of Targeted Medical Pharma. “The expansion and application of current initiatives, and our ability to enter new markets, has resulted in increased revenue for all of our business lines, and helped us generate our fifth consecutive quarter of revenue growth. The actual growth in revenue was over one-hundred percent in the first quarter of 2013, compared to the first quarter of 2012, and we were cash flow positive from operations as well. I am optimistic about our growth and the team we have in place as we continue to strengthen our product pipeline and expand our sales and marketing efforts, while at the same time contain our operating expenses as we work to expand market share and enter new markets. I am also very encouraged with the expansion of our product line to support the needs of our customers.”
Revenues for the three months ended March 31, 2013 were $2.811 million, compared to $1.375 million for the three months ended March 31, 2012, an increase of $1.436 million, or 104.4 percent. The increase in revenue was primarily attributed to a significant increase in prescriptions among workers compensation and commercial providers, along with improved collection rates for new and aged receivables.
Gross profit for the three months ended March 31, 2013 was $1.912 million, compared to $0.740 million for the three months ended March 31, 2012, an increase of $1.172 million, or 158.3 percent. The increase in gross profit was attributed to increased revenues resulting from a significant increase in collections and to a lesser extent payments associated with the Cambridge contract.
The net loss for the three months ended March 31, 2013 was $0.270 million and the diluted loss per share was $0.01, compared to a net loss of $0.976 million and diluted loss per share of $0.04 for the same period in 2012. The decrease in net loss was attributed to higher revenue combined with modest growth in operating expenses.
As of March 31, 2013 the Company had $34.6 million of unrecognized accounts receivables, not on the balance sheet due to our policy of not recognizing revenue for delivered product with a long collection cycle, until the cash is received. This unrecognized asset has the potential to become revenue in the future as the Company’s billing and collection subsidiary continues to collect accounts receivable on behalf of physicians using the Company’s managed business model and hybrid business model, for patient claims.
Adjusted EBITDA, a non-GAAP measure set forth in the table below, was negative $117 thousand for the three month period ended March 31, 2013, compared to negative $1.284 million for the three month period ended March 31, 2012, which is a reduction of $1.167 million or 91 percent.
“We’re very pleased to have generated positive cash flow from operations during the quarter,” said David Silver, M.D., President and Chief Operating Officer of Targeted Medical Pharma. “The results from the Cambridge agreement initiated in the first quarter of 2013, as well as our cost containment efforts, have established a good cash flow trajectory for the Company. We are focused on improving our margins and continue to leverage efficiencies in our distribution models, both of which contributed to a 68 percent operating loss improvement, as compared to the first quarter of 2012. We continue to build brand recognition in the medical community and are seeing increased demand from patients seeking our prescription medical foods. As we move forward with continued development of new products, we will remain focused on sustaining the growth reported for the first quarter.”
First Quarter Highlights:
- Expansion of private insurance market business
- Expansion of California Worker’s Compensation market business
- Issuance of our billing patent related to point of care medication dispensing and billing
- Submission of four new patent applications related to the oral stimulation of stem cells, particularly for the oral stimulation of progenitor red blood cell stem cells for treatment of chronic anemia
- Expansion of Agreement with Cambridge Medical Funding
- On April 19, 2013 the Company’s Registration Statement on Form S-1/A which registers up to 25,723,395 shares of common stock for resale was declared effective. The registration only involved existing shares and no new shares were issued. Of the 25,723,395 shares, 14,590,065 shares are owned by Company Insiders subject to Rule 144.
Continued 2013 Strategic Initiatives:
- Expansion of sales and marketing efforts to increase prescribing in the Workers’ Compensation and private insurance markets
- Conduct additional clinical trials for current and pipeline products including Theramine®, and new formulas for red blood cell production and nasal decongestion
- Continue development of new stem cell products for neuropathy, chronic anemia, and diabetes
The complete earnings report is available here: Targeted Medical Pharma 2013 First Quarter Results (PDF)