to all:
looks like viagra finally hit the bottom line for this company. they do mention vvus substaining the coatail effect. all in all i believe it to be a positive article for both vvus and pfe. from the article " While an initial inquiry may be
made because of Viagra, those men who decide to pursue treatment should
ultimately receive whatever treatment is most effective and medically
appropriate for them."
gw
Headline: Strong Initial Demand Seen for Pfizer's Viagra Impotence Pill as
Integrated Medical Resources Announces First Quarter 1998 Results
======================================================================
Nationwide direct marketing underway for Viagra(R) -- fastest-selling
prescription drug in history -- to Company's database of 50,000 diagnosed
impotent men and 110,000 prospective new patients; First quarter revenue
increases 32% for leading national network of impotence treatment clinics
LENEXA, Kan., May 6 /PRNewswire/ -- Integrated Medical Resources, Inc.
(NASDAQ:IMRI), manager of the leading national network of providers of
treatment for impotence, today announced revenues increased 32% to
$5.3 million for the three months ended March 31, 1998, compared to
$4.1 million in the first quarter of 1997.
The net loss for the first quarter of 1998 also showed significant
improvement, decreasing 51% from the year ago period. The Company's loss
before interest, taxes, depreciation and amortization (EBITDA) decreased 86%
to $176,000 for the first quarter of 1998, compared to a loss of $1.3 million
in the first quarter of 1997.
Strong initial demand was seen among the Company's established patients
for Pfizer's revolutionary new Viagra(R) impotence pill, which was approved by
the FDA at the end of March and has reportedly become the fastest-selling
prescription drug in history.
During the third week of April, Integrated Medical Resources launched an
updated version of its direct-response telemarketing campaign featuring
Viagra, targeted primarily toward the country's estimated 14 million men ages
40 to 70 who suffer from moderate to complete impotence.
The Company also began a direct mail campaign to more than 50,000 current
or former patients of the Diagnostic Centers for Men, which represents the
largest proprietary database of diagnosed impotent men in the U.S., as well as
to approximately 110,000 additional men who have inquired about treatment.
The Company expects to report on the progress of these efforts following the
end of the second quarter.
Each of the Company's Centers excluding 5 clinics in Texas and New York
has a pharmacy operation which can immediately fill prescriptions for patients
on-site. Since mid-April 1998 when Viagra first became widely available in
pharmacies and through the Diagnostic Centers for Men, the Centers have
reported a significant increase in established patient inquiries for the new
drug.
Viagra is Pfizer's trade name for sildenafil citrate, the first
FDA-approved oral medication for the treatment of male erectile dysfunction,
commonly known as impotence. In clinical studies, the drug improved sexual
function in about 70% of the men who took it. In those men for whom Viagra is
an appropriate medical option, the drug is viewed by many as preferable to
other treatments which may involve the introduction of medication directly
into the penis via injection or urethral suppository, the use of an external
device or a surgical procedure.
For the first quarter of 1998, the Company posted a net loss of $908,000
or ($0.13 per diluted share) on 6,733,642 weighted average common shares
outstanding, compared to a net loss of $1.8 million or ($0.27 per diluted
share) on 6,717,517 weighted average common shares outstanding for the first
quarter of 1997.
Dr. E. Stanley Kardatzke, Chairman and Chief Executive Officer, commented:
"Although I do not like to report losses of any kind, we are pleased to report
an improved net loss for the quarter. It is notable that Center operating and
corporate expenses, particularly physician and staff salaries and advertising,
have improved significantly as a percentage of revenue for two quarters in a
row. We believe this reflects the ongoing effectiveness of operational
process improvements and continued efforts to better leverage the Company's
infrastructure."
On a same-clinic basis in the mature Centers which have been open at least
15 months, the Company attained first quarter 1998 revenue of $4.67 million,
versus $4.72 million in the fourth quarter of 1997. This modest 1% decrease
reflects the suspension of the Company's pharmacy dispensing program during
the implementation of operational changes. First quarter 1998 revenue at the
mature Centers grew 42% compared to the same quarter in 1997 on a same-clinic
basis.
As of March 31, 1998, the Company managed 28 Centers operating in 18
states, compared to 31 Centers operating at the end of the first quarter of
last year. Two of the 28 Centers in operation were opened since year-end
1997.
Revenues from established patients were 10% of total patient charges
during the first quarter of 1998, compared to 11% in the fourth quarter of
1997 and 20% in the year ago first quarter. The higher revenue from
established patients in the first quarter of 1997 reflected the significant
response to the introduction of the urethral suppository MUSE(R) by VIVUS,
Inc. (NASDAQ:VVUS) in late 1996.
Kardatzke continued: "Pfizer's Viagra pill, just as MUSE did one year
ago, represents an additional opportunity for enhanced revenues, albeit a
potentially significant one, as it may motivate more men to seek treatment who
would not otherwise be properly diagnosed. While an initial inquiry may be
made because of Viagra, those men who decide to pursue treatment should
ultimately receive whatever treatment is most effective and medically
appropriate for them."
Dr. Troy Burns, President and Chief Medical Officer, observed:
"Integrated Medical Resources is a key player at a historic point in medical
science when innovative new treatments are being developed for the treatment
of impotence, most recently Pfizer's Viagra pill. In the very early going, we
are excited to see about half of the patients for whom we have prescribed
Viagra telling us that they are pleased with the results. The most
appropriate and effective treatment, however, depends on accurate diagnosis of
the cause of each patient's impotence based on a complex group of symptoms
which can sometimes indicate more serious, underlying disease. IMR is ideally
positioned to fulfill the needs of this largely untapped market where the
total annual revenue has been estimated at up to $5 billion."
Conversion of callers improved to 26.6% in the first quarter from 22.6% in
the preceding fourth quarter, with the number of new patients seen increasing
8%, totaling 5,994 during the first quarter compared with 5,548 in the fourth
quarter. This increase occurred despite the operation of 4 fewer Centers
during the first quarter of 1998 as compared with the fourth quarter of 1997.
The Company's patient base (patients treated on an ongoing basis) expanded 11%
to 58,796 at the end of the first quarter compared to 52,802 at the end of the
fourth quarter.
Kardatzke added: "The continued growth in new patient volume and related
impotence treatment revenues is particularly encouraging. In the last four
quarters, new patient volume has grown by over 23,000 or about 19%, a trend
which we expect to continue with added momentum provided by strong patient
demand for the Viagra pill. More recently, we have seen an improvement in
internally generated cash flows at the same time that more of the delayed
Medicare reimbursements to several of our managed clinics have been resolved.
All these developments, together with the previously announced additional
financing arrangements and the aggressive series of cost reduction measures
implemented in the fourth quarter, should allow us to meet our working capital
needs going forward while we focus on further improving our receivables
collections."
Additional Financing
On May 5, 1998, Kardatzke Management, Inc. and certain other significant
Company shareholders agreed to provide additional funding of up to
$2.1 million during May 1998. In consideration of unsecured notes, the
Company agreed to revise the exercise price of certain previously granted
options from $3.15 per share to $2.15 per share if exercised prior to May 31,
1998.
About the Company
Integrated Medical Resources, Inc. provides complete management services
to physicians who offer comprehensive diagnostic, educational and treatment
services designed to address the medical and emotional needs of its patients
and their partners through the largest network of medical clinics in the U.S.
dedicated to the diagnosis and treatment of impotence. The Company believes
that this market is largely underserved due to misconceptions about the causes
of impotence, a general lack of specialized knowledge by primary care
physicians regarding treatment alternatives, and the limited focus on
impotence by medical specialists.
The number of impotent men in the U.S. is estimated to exceed 24 million,
and this total is projected to increase by approximately 400,000 new cases
each year as the baby boomer generation ages. Although patients suffering
from impotence can range in age from 18 to over 90, the Company's target
marketing focus is the estimated 14 million men ages 40 to 70 who suffer from
moderate to complete impotence.
Cautionary Statement
This press release contains forward-looking statements of management
expectations and initiatives (within the meaning of the Private Securities
Litigation Reform Act of 1995) which should be viewed in the context of
various factors that could affect actual results. Forward-looking statements
are subject to certain risks and uncertainties which could cause actual
results to differ materially from those anticipated in the forward-looking
statements. You should review the Company's annual report on Form 10-K for
the year ended December 31, 1997 and Forms 8-K dated March 5, 1998; April 14,
1998; and April 28, 1998 filed with the Securities and Exchange Commission for
important factors that might cause such a difference.
Viagra(R) is a trademark of Pfizer, Inc. (NYSE:PFE).
MUSE(R) is a trademark of VIVUS, Inc.
INTEGRATED MEDICAL RESOURCES, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three months ended
March 31,
1998 1997
(Unaudited) (Unaudited)
Net center revenues $5,334 $4,056
Center operating expenses
Physician salaries 862 896
Cost of services 1,265 947
Center staff salaries 519 547
Center facilities rent 295 324
Total Center operating expenses 2,941 2,714
Center contribution 2,393 1,342
Corporate expenses:
Advertising 1,005 1,362
Selling, general and
administrative 1,564 1,253
Depreciation and amortization 489 558
Total corporate expenses 3,058 3,173
Operating loss (665) (1,831)
Other income (expense):
Interest income 3 61
Interest expense (246) (78)
Other 0 7
(243) (10)
Net loss $(908) $(1,841)
Basic weighted average common
shares outstanding 6,734 6,718
Net loss per common share --
basic and diluted $(0.13) $(0.27)
INTEGRATED MEDICAL RESOURCES, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, December 31,
1998 1997
(Unaudited)
Assets
Current assets:
Cash $577 $765
Accounts receivable 8,828 8,411
Supplies 381 407
Prepaid expenses 150 102
Total current assets 9,936 9,685
Property and equipment
Office equipment and
software 1,896 1,921
Furniture, fixtures and
equipment 6,382 6,431
Leasehold improvements 159 152
8,437 8,504
Accumulated depreciation 3,160 2,801
5,277 5,703
Intangible assets 157 183
Other assets 294 239
Total assets $15,664 $15,810
Liabilities and
stockholders' equity
Current liabilities:
Accounts payable $2,784 $3,793
Accrued expenses 2,485 2,238
Working capital line
of credit 2,587 3,086
Current portion of
long-term debt 2,902 2,685
Current portion of capital
lease obligations 205 246
Total current liabilities 11,233 12,048
Long-term debt, less
current portion 2,632 1,521
Capital lease obligations,
less current portion 106 140
Stockholders' equity:
Preferred stock 0 0
Common stock 9 7
Treasury stock (11) (11)
Additional paid-in capital 18,717 18,220
Accumulated deficit (17,022) (16,115)
Total stockholders' equity 1,693 2,101
Total liabilities and
stockholders' equity $15,664 $15,810
SOURCE Integrated Medical Resources, Inc.
-0- 05/06/98
/NOTE TO EDITORS: For more information on Integrated Medical Resources
toll-free via fax, simply dial 1-800-PRO-INFO, follow the voice menu prompts
and enter the company code "IMRI" on any touch tone phone. Visit the IMRI web
site: www.potency.com/
/CONTACT: Beverly Elving, Chief Financial Officer of Integrated Medical
Resources, 913-962-7201 x577, belving@unicom.net; or Paul Scheeler, General
Information, 312-640-6742, pas@chi.frbd.com, Robb Kristopher, Analysts-
Investors, 312-640-6669, rmk@chi.frbd.com, or Darcy Bretz, Media Inquiries,
312-640-6756, dfb@chi.frbd.com, all of The Financial Relations Board/
/Web site: potency.com
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