Interim Report Q1 2018

Zubsolv US growth of 26 percent in local currency

Q1 2018 highlights

  • Total net revenues of SEK 139.7 million, up 9.7 percent from Q1 previous year
  • Zubsolv US net revenue of SEK 131.1 million, up 14.9 percent in SEK and 26.2 percent in local currency compared to the same period last year
  • EBITDA of SEK -16.6 million, in line with guidance
  • Cash flow from operating activities of SEK 106.0 million, building a cash balance of SEK 437.5 million
  • Pipeline update, two more projects disclosed
  • Earnings per share, before dilution SEK -0.75 (-1.00), earnings per share after dilution SEK -0.75 (-1.00)
SEK million, if nothing else is mentioned  2018
12 mth
Apr 2017-
Mar 2018  
12 mth
Apr 2016 -
Mar 2017  
Net revenues  139.7  127.4  656.0  682.3 
wherof Zubsolv® US net revenue  131.1  114.1  502.8  497.5 
Cost of goods sold  -48.4  -46.2  -166.6  -163.3 
Operating expenses  -113.1  -104.4  -430.6  -464.3 
EBIT  -21.8  -23.2  58.8  54.7 
EBIT margin, %  -15.6  -18.2  9.0  8.0 
EBITDA  -16.6  -18.1  79.7  74.4 
Earnings per share, before dilution, SEK  -0.75  -1.00  0.92  0.84 
Earnings per share, after dilution, SEK  -0.75  -1.00  0.92  0.84 
Cash flow from operating activities  106.0  28.2  224.4  150.9 
Cash and cash equivalents  437.5  250.6  437.5  250.6 

Promising start for 2018

As I have indicated previously, the improved US market access delivered strong growth and Zubsolv broke its volume record and delivered a revenue growth of 26 percent in local currency. We also generated new early-stage projects leading to an update of our development pipeline. The financial position continued to improve, fueled by yet another strong cash-generating quarter.

Since we received confirmation of our improved market access position in the US from January 2018, I have had high expectations of Zubsolv sales growth in the first quarter of 2018. The main driver has been the new exclusive contracts implemented during the quarter. However, I am also encouraged by the growth seen in the competitive non-exclusive segments of the business. Our new preferred position with CVS Caremark has been a key contributor, despite the intense competition from other branded and generic products with similar preferred status. In the overall market, Zubsolv was the only branded product to gain market share in the quarter.

Building on the strong financial result in 2017, we continue to strengthen our financial position. I am pleased that our net cash improved by more than SEK 100 million during the quarter. The positive cash flow is explained by positive contributions from working capital. A key target for the company is to improve the profit contribution from our core business i.e. Zubsolv in the US. Adjusting for the expenses involved in setting up our new supply chain, which will generate an expected improvement in the cost of goods, and applying future expected cost of goods, we would have been profitable this quarter. Hence, I expect this investment to positively impact the profitability in the second half of 2018 and beyond, further reinforcing our expectations of a positive EBITDA for the full year. With confidence in our financial position we continue to invest in broadening our pipeline and to pursue new business development opportunities.

The focused work of developing and expanding our pipeline in recent years has started to show results. Based on positive in vitro data, we have decided to progress another early-stage project to the clinical stage. The new project is a naloxone rescue medication, with the aim of having superior attributes compared to products available today on the market or in development. Finally, we have also identified an opportunity to develop a new NSAID formulation which might have the potential to replace opioids for acute treatment of moderate to severe pain. These are early development programs and although there is need for more work, I am pleased that we now can report an expanded development pipeline. Regarding OX382, where we aim to develop a swallowable formulation of buprenorphine, we conducted our first clinical trial in humans. We have just received the results and we will need to continue the pharmaceutical formulation work before we can progress this project further. Due to the high activity in our pipeline and due to priority reasons we have decided to park the OX51 project. Hence it will not be disclosed in our pipeline overview after this report.

The business has started positively in 2018 and we will continue to focus all our attention on improving business performance even further, which makes me excited about Orexo’s future prospects.

Uppsala, Sweden, April 26, 2018

Nikolaj Sørensen
President and CEO

For further information, please contact
Nikolaj Sørensen, CEO and President or Henrik Juuel, EVP and CFO
Tel: +46 18 780 88 00. Email:

At 3.00 pm CET, the same day as the announcement of the report, Orexo invites analysts, investors and media to attend an audiocast with a web presentation where Nikolaj Sørensen, CEO, and Henrik Juuel, CFO, will present the report. After the presentation a Q&A will be held. Questions can also be sent in advance to, no later than 11.00 am CET. Please view the instructions below on how to participate.
Telephone: (SE) +46 856 642 664 (UK) +44 203 008 9802 (US) +1 855 753 2235.
The presentation material will be available on Orexo´s website one hour prior to the audiocast

This information is information that Orexo AB (publ.) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 8.00 am CET on April 26, 2018.