Form 10-Q PERNIX THERAPEUTICS HOLD For: Sep 30
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM�10-Q
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(Mark One)
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Quarterly report pursuant to section�13 or 15(d)�of the Securities Exchange Act of 1934
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For the quarterly period ended:�September 30, 2014
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Transition report pursuant to section�13 or 15(d)�of the Securities Exchange Act of 1934
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For the transition period from: _______ to _____________
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001-14494
Commission File Number
PERNIX THERAPEUTICS HOLDINGS,�INC.
� (Exact name of Registrant as specified in its charter)
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Maryland
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33-0724736
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(State or other jurisdiction�of incorporation or organization)
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(I.R.S. Employer�Identification Number)
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10 North Park Place, Suite 201, Morristown, NJ
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07960
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� (Address of principal executive offices)�
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(800)�793-2145
(Registrants telephone number, including area code)
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Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section�13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such report(s)) and (2) has been subject to such filing requirements for the past 90 days. Yes���No��.
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Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (�232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).��Yes���No��.
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Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer, and smaller reporting company in Rule�12b-2 of the Exchange Act. (Check one):
Large accelerated filer
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Accelerated filer
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Non-accelerated filer�
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Smaller reporting company
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(Do not check if a smaller reporting company)
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Indicate by check mark whether the Registrant is a shell company (as defined in Rule�12b-2 of the Exchange Act).� Yes����No���
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On November 7, 2014, there were�38,291,749 shares outstanding of the Registrants common stock, par value $0.01 per share.�
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PERNIX THERAPEUTICS HOLDINGS,�INC.
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Quarterly Report on Form�10-Q
For the Three and Nine Months Ended September 30, 2014
INDEX
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PART I.�
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FINANCIAL INFORMATION
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Item 1.�
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Financial Statements�
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Condensed Consolidated Balance Sheets as of�September 30, 2014 (unaudited) and December 31, 2013�
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4
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Condensed Consolidated Statements of Comprehensive Loss (unaudited) for the Three and��Nine Months Ended�September 30, 2014 and 2013
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5
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Condensed Consolidated Statement of Stockholders Equity (unaudited) for the Nine Months Ended September 30, 2014
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6
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Condensed Consolidated Statements of Cash Flows (unaudited) for the Nine Months Ended September 30, 2014 and 2013�
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7
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Notes to Condensed Consolidated Financial Statements�(unaudited)
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8
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Item 2.�
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Managements Discussion and Analysis of Financial Condition and Results of Operations�
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31
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Item 3.
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Quantitative and Qualitative Disclosures About Market Risk�
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44
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Item 4.
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Controls and Procedures
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44
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PART�II.�
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OTHER INFORMATION
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Item 1.�
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Legal Proceedings�
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46
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Item 1A.�
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Risk Factors
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46
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Item 2.�
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Unregistered Sales of Equity Securities and Use of Proceeds�
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75
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Item 3.�
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Defaults upon Senior Securities
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75
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Item 4.�
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Mine Safety Disclosures�
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75
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Item 5.��
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Other Information�
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76
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Item 6.��
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Exhibits
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76
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Signatures
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77
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2
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Cautionary Statement Regarding Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements to encourage companies to provide prospective information, so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those discussed in the statement. We desire to take advantage of these safe harbor provisions with regard to the forward-looking statements in this Form 10-Q and in the documents that are incorporated herein by reference. These forward-looking statements reflect our current views with respect to future events and financial performance. Specifically, forward-looking statements may include:
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projections of revenues, expenses, income, income per share and other performance measures;
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statements regarding expansion of operations, including entrance into new markets and development of products; and
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statements preceded by, followed by or that include the words estimate, plan, project, forecast, intend, expect, anticipate, believe, seek, target or similar expressions.
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These forward-looking statements express our best judgment based on currently available information and we believe that the expectations reflected in our forward-looking statements are reasonable.
By their nature, however, forward-looking statements often involve assumptions about the future. Such assumptions are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. As such, we cannot guarantee you that the expectations reflected in our forward-looking statements will actually be achieved. Actual results may differ materially from those in the forward-looking statements due to, among other things, the following factors:
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changes in general business, economic and market conditions;
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volatility in the securities markets generally or in the market price of our stock specifically; and
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the risks outlined in the section entitled Risk Factors contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2013 and this Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2014.
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We caution you not to place undue reliance on any forward-looking statements, which speak only as of the date of this Form 10-Q. Except as required by law,�we do�not undertake any obligation to publicly update or release any revisions to these forward-looking statements to reflect any events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
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PART I.���FINANCIAL INFORMATION
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PERNIX THERAPEUTICS HOLDINGS,�INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
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September�30,
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December�31,
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2014
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2013
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(unaudited)
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ASSETS
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Current assets:
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���Cash and cash equivalents
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� | $ | 16,429 | � | � | $ | 15,647 | � |
���Accounts receivable, net
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� | � | 51,844 | � | � | � | 25,681 | � |
���Inventory, net
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� | � | 11,592 | � | � | � | 13,810 | � |
���Note receivable, net of unamortized discount of $172 and $101, respectively
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� | � | 4,675 | � | � | � | 4,749 | � |
���Prepaid expenses and other current assets
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� | � | 10,512 | � | � | � | 5,879 | � |
���Income tax receivable
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� | � | 5,403 | � | � | � | 1,318 | � |
���Deferred income taxes
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� | � | 12,152 | � | � | � | 9,301 | � |
Total current assets
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� | � | 112,607 | � | � | � | 76,385 | � |
Property and equipment, net
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� | � | 1,066 | � | � | � | 6,872 | � |
Other assets:
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���Goodwill
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� | � | 45,890 | � | � | � | 42,497 | � |
���Intangible assets, net
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� | � | 319,139 | � | � | � | 80,022 | � |
���Note receivable, net of unamortized discount of $0 and $319, respectively
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