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Full year report January-December 2015

Unless otherwise stated in this report, all data refers to the Group. Figures in parentheses relate to the corresponding period in 2014.

2015 – a year of investments and growth. Zubsolv® revenue growth of
83 percent.

Fourth quarter 2015

▪      Total net revenues amounted to MSEK 228.3 (220.5).

▪      Zubsolv net revenue amounted to MSEK 120.3 (79.5).

▪      Earnings after tax were MSEK -51.8 (51.6).

▪      Earnings per share were SEK -1.50 (1.50).

▪      Cash flow from operating activities amounted to MSEK 6.3 (-7.3).

▪      Orexo received MGBP 5 milestone payment for Abstral® in Europe.

▪      Orexo recorded OX-MPI non-cash impairment charge of MSEK 62.

▪      Orexo announced new Abstral partner in the US.

▪      Orexo settled Abstral US patent litigation with Actavis.

▪      Orexo filed for FDA approval of new Zubsolv low dose.

January-December 2015

▪      Total net revenues amounted to MSEK 643.3 (570.3).

▪      Net revenues, adjusted 1), were MSEK 586.3 (396.7), up by 47.8 percent.

▪      Zubsolv net revenue amounted to MSEK 416.7 (228.0).

▪      Earnings after tax were MSEK -198.0 (-56.6).

▪      Earnings per share were SEK -5.74 (-1.73).

▪      EBITDA, adjusted 1), were MSEK -145.3 (-186.1), an improvement of MSEK 40.8.

▪      Cash flow from operating activities amounted to MSEK -102.2 (-487.3).

▪      Cash and cash equivalents amounted to MSEK 198.1 (284.5).

▪      Orexo broadened Zubsolv product range.

▪      FDA approved Zubsolv for induction treatment of opioid dependence.

▪      New clinical data established Zubsolv as effective, well tolerated for maintenance treatment of opioid dependence and increases patients’ work productivity.

▪      Zubsolv excluded from CVS Caremark preferred position effective from January 1, 2016 after closed tender process.

▪      New exclusive agreement with unnamed Pharmacy Benefit Manager in Managed Medicaid.

▪      Orexo divested the subsidiary Kibion.

▪      Orexo settled patent infringement litigation against Mylan regarding Edluar®.

MSEK 2015 2014 2015 2014
Oct-Dec Oct-Dec Jan-Dec Jan-Dec
Net revenues 228.3 220.5 643.3 570.3
Revenues from launched products 228.3 220.5 643.3 568.6
EBIT -44.3 59.0 -169.0 -25.0
EBITDA 24.8 64.1 -88.3 -12.5
Earnings after tax -51.8 51.6 -198.0 -56.6
Earnings per share before dilution, SEK -1.50 1.50 -5.74 -1.73
Cash flow from operating activities 6.3 -7.3 -102.2 -487.3
Cash and cash equivalents 198.1 284.5 198.1 284.5
Key figures adjusted for non-cash fixed Abstral® royalty 1)
MSEK 2015 2014 2015 2014
Oct-Dec Oct-Dec Jan-Dec Jan-Dec
Net revenues, adjusted 1) 228.3 186.0 586.3 396.7
EBITDA, adjusted 1) 24.8 29.6 -145.3 -186.1

1) The non-cash fixed Abstral royalty represents an amortization of fixed and unconditional payments received in connection with the 2012 agreement with ProStrakan. This was fully recognized in the P&L by May 2015.

CEO Nikolaj Sørensen and CFO Henrik Juuel will present the report at a teleconference on January 28, 2016 at 2:00 p.m. CET (08:00 a.m. EDT).
Presentation slides are available via the link and on the website.
Telephone: 46 8 566 42652 (SE), +44 203 426 2845 (UK) or +1 347 329 1282 (US).

For further information, please contact:
Nikolaj Sørensen, CEO or Henrik Juuel, EVP and CFO
Tel: +46 (0)18 780 88 00, E-mail:

CEO’s comments
The United States consume 80 percent of the world’s opioids, but only account for 4.6 percent of the world’s population and the amount of opioid painkillers prescribed is enough to medicate every single adult in the country for one month. The consequences, when opioids are abused, on the society is severe and in 2014, 28,647 people died from drug overdose with opioids[1] in the US. This a tripling since year 2000 and has created an outcry in major media in the US e.g. the cover page of the first Newsweek® of 2016 read “Why Are White Americans Dying Younger?”, with the answer being the prescription opioid epidemic.

Since the initiation of our commercial journey for Zubsolv®, we have highlighted the significant unmet need for opioid dependence treatment. More than 10 million Americans are using opioids for non-medical purposes and less than 1 million receiving any type of treatment today. The need for actions from the authorities in the United States is imminent and this was one of the first topics raised by President Obama in his final State of the Union speech. We know several concrete improvements are being evaluated, one being how to double the amount of prescribers in this disease space (2). We have anticipated this type of change and it has been an integral part of our business plans since we decided to establish a commercial entity in the US. Two years into our commercial journey in the US, we finally see concrete steps in the right direction for the patients and for Orexo and this give me strong confidence in the journey have ahead of us.

In a market facing dramatic changes, being at the forefront in terms of scientific documentation and developing a product range, providing the optimal convenience and flexibility for patients and physicians are important competitive differentiators. Thus, I am happy to report our registry study REZOLV is about to finalize the patient recruitment with more than 1,000 patients enrolled by the end of 2015. Also our product development has progressed and we launched two new tablet strengths in the fourth quarter. However, when I met physicians during the launch of these new tablets, they inquired about a tablet with lower strength to improve their ability to tapering down with Zubsolv. Thus, I am pleased to report that we have filed for approval a new lower dosage in Q4, 2015 and we anticipate FDA approval in Q4, 2016.

While we continue to invest in the growth of Zubsolv, we also continuously assess where and how to optimize the use of our resources. As a reaction to the change in market access from January 1, 2016 we have made an adjustment in the sales force in selected geographies. This will increase efficiency and enable a focus where our presence has the highest return on investment potential. One such region is the State of New York where we won an exclusive regional contract to be implemented in March 2016. We will ensure we have sufficient resources in this region to optimize the value of this contract. Another important driver of the profitability of our commercial investments, is the price and I am pleased to report we have been able to increase the price of Zubsolv in January 2016.

Our efforts to find a partner for Zubsolv outside the US and for our project OX-51 continue to progress well. We expect to finalize the full license agreement for Zubsolv outside the US in the first half of 2016. Like we have seen with Abstral® in Europe, the right partner for Zubsolv will further strengthening Orexo’s long term growth opportunities.

Nikolaj Sørensen
President and CEO

2 Huffington Post, Oct 21, 2015.

Please note
Orexo AB (publ) discloses the information provided herein pursuant to the Financial Instruments Trading Act and/or the Securities Market Act. The information was provided for public release on January 28, 2016, at 8:00 a.m. CET. This report has been prepared in both Swedish and English. In the event of any discrepancy in the content of the two versions, the Swedish version shall prevail.


Source: Orexo