Strong fundamentals in place to fuel strategy for future growth

Q4 2019 highlights

  • Total net revenues of SEK 238.1 million (227.1), up 4.8 percent
  • Zubsolv® US net revenues of SEK 190.5 million (166.7), up 14.3 percent in SEK and 7.5 percent in local currency
  • Net earnings of SEK 38.9 million (51.6), down 24.6 percent
  • EBITDA of SEK 85.8 million (42.8), up 100.5 percent. EBITDA ex Abstral® of SEK 39.6 million (-9.6).
  • US EBIT of SEK 98.2 million (62.0), up 58,4 percent
  • Cash flow from operating activities of SEK 60.2 million (71.7), building a cash balance of SEK 816.8 million (589.8)
  • Acquired the exclusive US rights to commercialize vorvida®, a digital therapy for alcohol use disorder with scientifically proven efficacy
  • Dennis Urbaniak was appointed as Executive Vice President Digital Therapeutics
  • Announced a Capital Markets Day to be held in Stockholm, Sweden, on March 17, 2020
  • Financial outlook provided for 2020, see page 11

Important events after the end of the period

  • OX338 showed promising results from the human PK study, assessing novel ketorolac formulations for treatment of pain
SEK m, unless otherwise stated 2019 Oct-Dec 2018 Oct-Dec 2019 Jan-Dec 2018 Jan-Dec Δ 2018-2019
Net revenues 238.1 227.1 844.8 783.1 8%
whereof Zubsolv® US net revenues 190.5 166.7 719.2 621.5 16%
Cost of goods sold -23.0 -43.4 -105.6 -171.8 -39%
Operating expenses -143.5 -146.1 -508.0 -515.6 -1%
EBIT 71.5 37.6 231.2 95.8 141%
EBIT margin, % 30.0 16.6 27.4 12.2 15.2 ppt
US EBIT 98.2 62.0 350.9 198.3 77%
US EBIT margin, % 51.6 37.2 48.8 31.9 16.9 ppt
EBITDA 85.8 42.8 272.1 116.6 133%
Earnings per share, before dilution, SEK 1.12 1.49 6.33 3.99 59%
Earnings per share, after dilution, SEK 1.10 1.47 6.20 3.93 58%
Cash flow from operating activities 60.2 71.7 290.9 242.0 20%
Cash and cash equivalents 816.8 589.8 816.8 589.8 38%

2019 – a record year further establishing a strong foundation for future growth

2019 delivered the strongest financial results for Orexo, with the fourth quarter being no exception. This was driven by a stellar performance from our teams in Sweden and the US, who oversaw additional strategic objectives for the year with the advancement of our pipeline and two partnership agreements for digital therapeutics; promising growth drivers for Orexo’s future.

A strong year financially and operationally – SEK 272 m in EBITDA and SEK 817 m in cash 
I am pleased to report a very strong financial performance both in the fourth quarter and for the full year. Despite increased competition from generics in the first half of 2019, we have managed to grow Zubsolv® sales on a full year basis, control our costs and we are proud to present an all-time-high financial result. The fourth quarter saw continued sales growth, above market average, of Zubsolv in the reimbursed open formulary businesses of the market fully compensating for the decline in the previously exclusive reimbursement contracts and cash segment. In the fourth quarter this decline has levelled off, and we are now entering a period where Zubsolv will be less dependent on individual exclusive contracts with insurance companies.
During 2019 we have been very active in assessing business development, M&A opportunities and progressing the R&D pipeline. Our strong financial position enables us to continue to pursue opportunities to acquire complementary products and companies, and to invest in our R&D pipeline.

R&D –  our strategic investments for growth
As a result of our pipeline progression during 2019, we are now in a strong position to invest properly in our wholly-owned assets over the course of 2020. We intend to complete the development program for OX124, a naloxone rescue medication for opioid overdose, during 2020, with the potential for FDA approval in 2021. The naloxone rescue market is currently valued at USD 300 million, with strong double-digit growth, and OX124 could be a more effective product on the market with a unique nasal delivery system. We are also planning the first clinical trial for OX125 in H1 2020, addressing the same market, but with nalmefene as the active ingredient. We also completed the first clinical trial for OX338, a non-opioid painkiller, at the end of 2019, with promising clinical results, but with a need to continue to optimize the formulation to ensure we can obtain a unique product profile and strong IP protection.

Digital Therapeutics – new frontiers in patient care
I remain confident that digital therapeutics will become an integral part of the healthcare landscape and that addiction is one of the main areas most in need of innovative ways to deliver treatment. During the quarter we took significant steps forward in executing our strategy, we signed a second agreement with GAIA AG in Q4 2019, licensing the rights to vorvida®, a digital therapy for alcohol use disorder. This complemented the earlier partnership agreement with GAIA (in August 2019) to develop and commercialize OXD01, a digital therapy for the treatment of Opioid Use Disorder. We intend to develop OXD01 for a potential launch in the US in 2021, subject to regulatory approval, and plan to prepare vorvida® for launch in the US market in H2 2020, pending feedback from the FDA. vorvida® has already been launched in Europe and has generated impressive clinical evidence on the effect on alcoholism – which continues to be an area of high unmet medical need.
We also appointed Dennis Urbaniak as Executive Vice President of Digital Therapeutics. Together with Dennis, we are finalizing our overarching digital business plan, and are excited to share more details at our upcoming Capital Markets Day in March 2020 in Stockholm, Sweden.

“Together with Dennis, we are finalizing our overarching digital business plan, and are excited to share more details at our upcoming Capital Markets Day in March 2020 in Stockholm, Sweden.” 

Summary and Outlook
With 2019 behind us, I want to express my appreciation to my entire team for their efforts in making 2019 a strong year, both financially and through pipeline progress. Our focus is now to leverage the results of 2019 to build an even more exciting future for Orexo. 2020 is set to be an important year of investment for the company, as we commit significant resources to the final development of OX124, and our two digital therapies, OXD01 and vorvida®. We are confident these investments can be financed by the profits generated by Zubsolv in the US and we are excited to develop these opportunities over the year, with the ultimate goal of strengthening Orexo’s future position. My team and I are looking forward to a prosperous 2020 and thank all our investors and stakeholders for their confidence in Orexo.

Uppsala, Sweden, January 30, 2020

Nikolaj Sørensen
President and CEO

For further information, please contact
Nikolaj Sørensen, CEO and President, Joseph DeFeo, EVP and CFO or Lena Wange, IR & Communications Manager
Tel: +46 18 780 88 00, +1 855 982 7658, Email:

At 2.00 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 Joseph DeFeo, 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 8 505 583 55 UK +44 3 333 009 031 US +1 6 467 224 957
The presentation material will be available on Orexo´s website 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 January 30, 2020.