In January of last year, Midland Walwyn had a 52 week target price for Axcan of $15.50. It's currently trading at $6.75. I think it's worth a look. Here is their 1998 year-end dated November, 1998:
Axcan Reports its 1998 Year-End Results - Revenues Up 133% Compared to Previous Year
MONTREAL, Nov. 19 /CNW/ - Axcan Pharma Inc. reported today its financial results for the 1998 fiscal year ended September 30, 1998. All figures are in Canadian dollars.
The Company announced an increase of 133% in total revenues to
$43,404,000 for the year ended September 30, 1998, compared to the previous year's revenues of $18,663,000. The company's net earnings amounted to $1,540,000 or $0.10 per share for the year ended September 30, 1998, compared to a net loss of $1,187,000 or $0.08 per share for the year ended September 30, 1997. These earnings include a one-time gain of $0.06 per share generated by the sale of Biopharm Laboratories to Warnex Pharma Inc.
For the fourth quarter ended September 30, 1998, Axcan reported revenues of $12,237,000, which represents an increase of 100% in comparison to the same period last year when revenues amounted to $6,130,000. The Company posted a net loss of $509,000 or $0.03 per share for the quarter, compared to a net loss of $209,000 or $0.01 per share for the same period in 1997.
Sales and administrative expenses amounted to $20,022,000 for the fiscal year ended September 30, 1998, compared to $8,302,000 for fiscal 1997. These expenses amounted to $6,410,000 for the fourth quarter ended September 30, 1998 compared to $2,686,000 for the corresponding period of the preceding year. This increase in sales and administration expenses is mainly due to Axcan's share of the marketing expenses generated by the launch of URSO(R) in the U.S. marketplace.
The cost of goods sold as a percentage of sales decreased from 50% in 1997 to 38% for the fiscal year ended September 30, 1998. For the quarter ended September 30, 1998, the cost of goods sold represents 38% of sales compared to 44% for the same period last year.
The Company's R&D expenditures for fiscal 1998 were $2,970,000, a 21% increase over $2,452,000 for fiscal 1997.
1998: A TURNING-POINT IN THE HISTORY OF AXCAN PHARMA
- The main event of this exercise was the approval of URSO(R) by the FDA. This product was launched in May, 1998, through Axcan Schwarz
LLC, the joint-venture created with Schwarz Pharma US in January 1997.
- Axcan more than doubled its sales, due to strategic acquisitions of complementary products at the end of the previous exercise.
- Axcan sales are well divided among various important products such as Viokase(R), URSO(R), Modulon(R) and Salofalk(R).
Many other important developments have marked this fiscal year:
INVESTMENTS
In December 1997, Mutual Asset Management acquired 450,000 shares of Axcan at $12,97 by means of a private placement. The gross proceeds from this offering amounted to $5,836,500.
In April 1998, Axcan Pharma invested $600,000 in Biozymes, a
biotechnology company from Quebec City active in the extraction of enzymes such as pancrelipase which is used as a raw material in the production of Viokase(R), a key product for Axcan.
Finally, in May 1998, Axcan concluded the sale of Biopharm Laboratories to Warnex Pharma Inc. This sale allowed the Company to refocus its operations on gastroenterology. The proceeds from this transaction amounted to $1.5 million and were injected into the Company's working capital.
RESEARCH AND DEVELOPMENT
Two products from Axcan's pipeline, URSO(R) and Salofalk(R), received an approval from a regulatory authority during this exercise.
URSO(R) received FDA approval in December, 1997, for the treatment of
Primary Biliary Cirrhosis. In November, a first milestone was reached when URSO(R) registered 10% of all new ursodiol prescriptions in the United States.
''Primary Biliary Cirrhosis is a slow debilitating disease and PBC
patients visit their physician only once or twice a year unless complications occurs,'' said Léon Gosselin, President & CEO of Axcan. ''Significant efforts will be put behind URSO(R) since it is expected that this increase in prescriptions will continue over the coming months,'' he added.
Salofalk(R) was approved by Health Canada in August 1998. This product has been marketed by Axcan since 1986 for the treatment of ulcerative colitis. From now on, the Company will also market it for the prevention of a relapse of Crohn's disease in patients who have undergone bowel resection.
Finally, in April 1998, Axcan filed a New Drug Submission with Health Canada's Drug Directorate for Gastrostat(R), a blister package containing three drugs effective in eradicating Helicobacter pylori bacteria, one of the main causes of peptic ulcer.
The Company now has 15 research projects on-going, all of them in Phase II or III.
The main projects aim at diversifying and developing new
applications for URSO(R), such as the prevention of colorectal cancer, hypercholesterolemia and non-alcoholic steatohepatitis. Axcan is also very active in the development of a single triple therapy for the eradication of Helicobacter pylori. The results of a pilot study published in January, 1998, confirmed a high eradication rate when such a regimen is used.
CONCLUSION
''This fiscal year was a very fruitful one for Axcan and has been
extremely active. We significantly increased the number of products we offer in Canada and in the U.S. This allowed us to increase our sales by more than 100%. We also focused our efforts on the launch of URSO(R) in the U.S. marketplace and we are confident that this product will realize its full potential in the near future,'' said Léon Gosselin. ''The successes we have achieved in 1998 give us the possibility to look into various opportunities that were previously out of our reach. We are pursuing our growth strategy by extending our presence both on the Canadian and international markets through
strategic alliances, and the acquisition of products or even companies active in our field of activity,'' he added.
Axcan Pharma is a Canadian pharmaceutical company involved in the
development and distribution of pharmaceutical products, mainly in the field of gastroenterology. Axcan is one of the ten largest publicly traded health-care companies in Canada and is listed on the Montreal and Toronto Stock Exchanges under the AXP symbol. |
