Recro Pharma (REPH) Tops Q3 EPS by 11c, Revenues Beat

Recro Pharma (NASDAQ: REPH) reported Q3 EPS of ($0.09), $0.11 better than the analyst estimate of ($0.20). Revenue for the quarter came in at $19.29 million versus the consensus estimate of $16.33 million.

“We continue to deliver superior manufacturing and development services to our customers as their projects grow and evolve,” said Gerri Henwood, President and Chief Executive Officer. “And since the launch of our Clinical Trials Materials (CTM) and Logistics business in late June, we have seen interest in this area increase and early work has resulted in expanded proposal scope. Customers are taking advantage of moving directly from our clinical trial drug manufacturing right into our double-blind packaging, labeling and distribution services; recognizing the benefit of using Recro as a single source. We continue to enhance our business development team and have promising CDMO opportunities, adding to our momentum going into 2021. We do continue to see the COVID-19 pandemic impacting end-user demand, inventory rebalancing and project starts through the remainder of the year and possibly beyond.”

Ms. Henwood also stated, “In November, we signed a three-year extension to our Licensing and Supply Agreement with Lannett, a generic pharmaceutical company, for manufacturing of Verelan PM, Verelan SR and Verapamil PM. The signing of this agreement included a $1.9 million up front cash payment, and a $0.5 million per year licensing fee for each of the three extension years, ending on December 31, 2024.”

“Collectively, these initiatives contributed a 24% increase in revenues during the third quarter compared to the second quarter,” continued Ms. Henwood. “Meanwhile, we have also made great strides preparing Recro to execute our future growth plans. We worked with our partners at Athyrium to adjust our credit agreement which resulted in modifications to certain debt covenants, repayment of $9 million in loan principal in 2020 without prepayment penalties, reducing our interest expense and the elimination of $12 million of principal payments in 2021, further enabling us to execute our growth strategies.”

For earnings history and earnings-related data on Recro Pharma (REPH) click here.

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