Cornerstone Therapeutics Reports Fourth Quarter and Fiscal Year 2012 Financial Results

Cornerstone Therapeutics Reports Fourth Quarter and Fiscal Year 2012 Financial 
Results 
CARY, NC -- (Marketwire) -- 03/14/13 --  Cornerstone Therapeutics
Inc. (NASDAQ: CRTX), a specialty pharmaceutical company focused on
commercializing products for the U.S. hospital and adjacent specialty
markets, today announced results for the fourth quarter and full year
ended December 31, 2012. 
Total net product sales were $116.1 million in 2012 versus $101.3
million reported in 2011, an increase of 15%. For the fourth quarter
of 2012, net product sales were $34.9 million versus $18.2 million,
up 92%, compared to the fourth quarter of 2011. Net sales from the
ZYFLO(R) family of products amounted to $53.6 million, up 75% year
over year. CUROSURF(R) net sales were $35.0 million, marginally up
from the 2011 level. CARDENE(R) I.V. net sales were $24.8 million for
the period from June 26, 2012, the acquisition date, through December
31, 2012.  
Net loss in 2012 was $11.9 million, or $(0.46) per diluted share,
compared to a net loss of $693,000, or $(0.03) per diluted share, in
2011. Net loss for the fourth quarter of 2012 was $7.0 million, or
$(0.26) per diluted share, compared to a net loss of $2.7 million, or
$(0.11) per diluted share, in the fourth quarter of 2011. The
Company's net loss in the fourth quarter and for the full year
resulted primarily from three events: a charitable donation of
CARDENE I.V. inventory valued at $11.7 million; a write-off of
RETAVASE(R) inventory valued at $14.6 million; and impairment of our
LIXAR(R) in-process research and development assets valued at $11.5
million offset by a reduction in value of the related contingent
payments of $8.8 million.  
On a non-GAAP basis, net income for the year was $16.3 million, or
$0.59 per diluted share, an increase of 76% from non-GAAP income of
$9.2 million, or $0.35 per diluted share, in 2011. Non-GAAP net
income for the fourth quarter of 2012 was $6.5 million, or $0.22 per
diluted share, compared to a non-GAAP net loss of $1.5 million, or
$(0.06) per diluted share, in 2011. 
Non-GAAP net income and net income per diluted share exclude
stock-based compensation expense, amortization and impairment of
product rights, transaction-related expenses, acquisition adjustments
related to inventory, the CA
RDENE I.V. charitable inventory donation,
the RETAVASE inventory write-off, the change in acquisition-related
contingent payments and the gain on the divestiture of certain
product rights. 
"In 2012, we executed on our strategy to transition away from our
primary-care focused anti-infective business and focus primarily on
the hospital and adjacent specialty markets. With the integration of
EKR now substantially complete, we are well positioned as a Company
for future growth. Additionally, we closed 2012 by extending our
CUROSURF licensing agreement with Chiesi which now runs through 2024
and includes supply price and commercial incentives, which we believe
will further improve product margin," said Craig A. Collard,
Cornerstone's Chief Executive Officer. "We expect to continue this
momentum in 2013 by growing revenues organically, bringing the
products in our pipeline to market and keeping a keen eye out for
licensing and acquisition opportunities that align with our vision
for growth."  
A breakdown of net revenues by product for the three and 12 months
ended December 31, 2012 (in thousands, except percentages) follows: 


 
                                                                            
                Three Months                                                
                   Ended                        Year Ended                  
                December 31,     Change        December 31,       Change    
              --------------- ------------  ----------------- ------------- 
                2012    2011     $      %     2012     2011       $      %  
              ------- ------- ------- ----  -------- -------- -------- ---- 
Net product                                                                 
 sales                                                                      
  CARDENE                                                                   
   I.V.                                                                     
   product                                                                  
   family     $11,293       - $11,293  100% $ 24,807        - $ 24,807  100%
  CUROSURF      8,127   9,450  (1,323) (14)   34,972   34,852      120    - 
  ZYFLO                                                                     
   product                                                                  
   family      15,822   8,361   7,461   89    53,553   30,674   22,879   75 
  AlleRx Dose                                                               
   Pack                                                                     
   products      (282) (2,928)  2,646  (90)   (1,407)  23,263  (24,670)(106)
  Anti-                                                                     
   infective                                                                
   products         -   3,109  (3,109)(100)    3,374   14,387  (11,013) (77)
  Other                                                                     
   products       (33)    192    (225)(117)      781   (1,875)   2,656    - 
              ------- ------- -------       -------- -------- --------      
  Total net                                                                 
   product                                                                  
   sales       34,927  18,184  16,743   92   116,080  101,301   14,779   15 
License and                                                                 
 royalty                                                                    
 agreement                                                                  
 revenues           -      22     (22)(100)        4      121     (117) (97)
              ------- ------- -------       -------- -------- --------      
Net revenues  $34,927 $18,206  16,721   92  $116,084 $101,422   14,662   14 
              ------- ------- -------       -------- -------- --------      

 
Gross margin (exclusive of license and royalty agreement revenues and
amortization of product rights) for 2012 was 63% and remained flat
compared to 2011. Cost of product sales for 2012 included $4.2
million of fair value step-up adjustments related to acquired CARDENE
I.V. inventory sold during the year, which had a four percentage
point negative impact on gross margin. 
Selling, general and administrative expenses were relatively flat at
$46.4 million in 2012 compared to $45.9 million in 2011. Reductions
in certain employee-related costs driven by the divestiture of the
anti-infective product rights and respiratory sales force in March
2012 were offset by increases in co-promotion expense and marketed
product support related to ZYFLO. 
As of December 31, 2012, Cornerstone had $56.3 million in cash and
cash equivalents compared to $34.2 million at the end of the third
quarter 2012 and $74.0 million at December 31, 2011. The
year-over-year decrease primarily represents the $36.4 million of
cash-on-hand used to help fund the EKR Therapeutics acquisition,
while the sequential increase reflects our strong cash flow from
operations. 
Conference Call Information  
Cornerstone Therapeutics will host a conference call today at 8:30 AM
ET to discuss financial results for
 the three and 12 months ended
December 31, 2012. To participate in the live conference call, please
dial 888-364-3109 (U.S. callers) or 719-325-2432 (international
callers), and provide passcode 4876543. A live webcast of the call
will also be available through the Investor Relations section of the
Company's website. Please allow extra time prior to the webcast to
register, download and install any necessary audio software. 
The conference call and the webcast will be archived for 30 days. The
telephone replay of the call will be available approximately two
hours after completion of the call by dialing 888-203-1112 (U.S.
callers) or 719-457-0820 (international callers), and providing
passcode 4876543.  
About Cornerstone Therapeutics 
Cornerstone Therapeutics Inc. (NASDAQ: CRTX), headquartered in Cary,
N.C., is a specialty pharmaceutical company focused on
commercializing products for the hospital and adjacent specialty
markets. Key elements of the Company's strategy are to focus its
commercial and development efforts in the hospital and adjacent
specialty product sector within the U.S. pharmaceutical marketplace;
continue to seek out opportunities to acquire companies, marketed or
registration-stage products and late-stage development products that
fit within the Company's focus areas; and generate revenues by
marketing approved generic products through the Company's
wholly-owned subsidiary, Arist
os Pharmaceuticals, Inc. For more
information, visit www.crtx.com. 
Use of Non-GAAP Financial Measures  
To supplement the consolidated financial statements presented in
accordance with GAAP, the Company uses non-GAAP measures of certain
components of financial performance. These non-GAAP measures include
non-GAAP operating income, non-GAAP net income and non-GAAP net
income per diluted share. The Company's management regularly uses
supplemental non-GAAP financial measures to understand, manage and
evaluate its business and make operating decisions. These non-GAAP
measures are among the primary factors management uses in planning
for and forecasting future periods. 
These non-GAAP measures are not in accordance with, or an alternative
to, measures prepared in accordance with GAAP and may be different
from similarly titled non-GAAP measures used by other companies. In
addition, these non-GAAP measures are not based on any comprehensive
set of accounting rules or principles. The additional non-GAAP
financial information presented in this press release should be
considered in conjunction with, and not as a substitute for, or
superior to, the financial information presented in accordance with
GAAP (such as operating income (loss), net income (loss) and earnings
(loss) per share) and should not be considered measures of the
Company's liquidity. These non-GAAP measures should only be used to
evaluate the 
Company's results of operations in conjunction with the
corresponding GAAP measures. 
The non-GAAP financial measures reflect adjustments for stock-based
compensation expense, amortization and impairment of product rights,
transaction-related expenses, acquisition adjustments related to
inventory, its CARDENE I.V. charitable inventory donation, its
RETAVASE inventory write-off, changes in acquisition-related
contingent payments, and the gain on the divestiture of certain
product rights. Transaction-related expenses consist of (1) costs
incurred to complete product or company acquisitions or other
strategic transactions, including due diligence and legal, consulting
and other related fees; (2) integration costs related to the
Company's completed transactions; and (3) transaction-related fees
associated with transactions that are not consummated. The Company
excludes these items from its non-GAAP measures because it believes
that their exclusion provides an additional means to assess the
extent to which the Company's efforts and execution of its strategy
are reflected in its operating results. In particular, stock-based
compensation expense is excluded primarily because it is a non-cash
expense that is determined based on subjective assumptions;
amortization and impairment of product rights are excluded because
they are not reflective of the cash-settled expenses incurred related
to product sales; and the transaction-related expenses, acquisition
adjustments related to inventory, its CARDENE I.V. charitable
inventory donation, its RETAVASE inventory write-off, changes in
acquisition contingent payments, and the Company's gain on the
divestiture of certain product rights are excluded because management
believes they have no direct correlation to current operating
results. Management believes that these non-GAAP measures, when shown
in conjunction with the corresponding GAAP measures, enhance
investors' and management's overall understanding of the Company's
current financial performance and its prospects for the future. 
The non-GAAP measures are subject to inherent limitations because (1)
they do not reflect all of the expenses associated with the results
of operations as determined in accordance with GAAP and (2) the
exclusion of these items involved the exercise of judgment by
management. Even though the Company has excluded stock-based
compensation expense, amortization and impairment of product rights,
transaction-related expenses, acquisition adjustments related to
inventory, CARDENE I.V. charitable inventory donation, RETAVASE
inventory write-off, changes in acquisition-related contingent
payments, and the gain from the divestiture of product rights from
the non-GAAP financial measures, stock-based compensation is an
integral part of the Company's compensation structure, the
acquisition of addit
ional companies and/or product rights and the
divestiture of the Company's anti-infective product rights are an
important part of its business strategy, transaction-related
expenses, whether or not the transaction is successfully closed, may
be significant cash expenses and the disposition of its assets other
than through product sales has a negative impact on the Company's
results of operations and cash flows.  
Safe Harbor Statement 
Statements in this press release regarding the progress and timing of
our product development programs and related trials; our future
opportunities; our strategy, future operations, anticipated financial
position, future revenues and projected costs; our management's
prospects, plans and objectives; and any other statements about
management's future expectations, beliefs, goals, plans or prospects
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995.  
Any statements that are not statements of historical fact (including,
without limitation, statements containing the words "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may," "plan,"
"project," "should," "target," "will," "would" and similar
expressions) should also be considered to be forward-looking
statements.  
There are a number of important factors that could cause our actual
results or events to differ materially from those indicated by such
forward-looking statements, including risks relating to our "critical
accounting estimates"; our ability to develop and maintain the
necessary sales, marketing, supply chain, distribution and
manufacturing capabilities to commercialize our products; our ability
to replace the revenues from products we no longer market; the
adverse impact of returns of previously sold inventory; patient,
physician and third-party payer acceptance of our products as safe
and effective therapeutic products; our heavy dependence on the
commercial success of a relatively small number of currently marketed
products; our ability to maintain regulatory approvals to market and
sell our products; our ability to obtain FDA approval to manufacture,
market and sell our products and product candidates, including our
lixivaptan compound, LIXAR (formerly referred to as CRTX 080), and
RETAVASE; our ability to successfully and effectively launch our
Hydrocodone Polistirex and Chlorpheniramine Polistirex Extended
Release Suspension product (formerly referred to as CRTX 067); our
ability to enter into additional strategic licensing, product
acquisition, collaboration or co-promotion transactions on favorable
terms, if at all; our ability to manage and control unknown
liabilities in connection with any acquisitions; our ability to
successfully manage growth or integrate acquired businesses and
operations; our ability to maintain co
mpliance with NASDAQ listing
requirements; adverse side effects experienced by patients taking our
products; difficulties relating to clinical trials, including
difficulties or delays in the completion of patient enrollment, data
collection or data analysis; the results of preclinical studies and
clinical trials with respect to our product candidates and whether
such results will be indicative of results obtained in later clinical
trials; our ability to develop and commercialize our product
candidates before our competitors develop and commercialize competing
products; our ability to satisfy FDA and other regulatory
requirements; our substantial indebtedness and debt covenants; and
our ability to obtain, maintain and enforce patent and other
intellectual property protection for our products and product
candidates and the other factors described in Item 1A (Risk Factors)
of our Annual Report on Form 10-K filed with the SEC on March 6,
2012, Item 1A (Risk Factors) in our Quarterly Report on Form 10-Q
filed with the SEC on November 8, 2012 and in our subsequent filings
with the SEC. If one or more of these factors materialize, or if any
underlying assumptions prove incorrect, our actual results,
performance or achievements may vary materially from any future
results, performance or achievements expressed or implied by these
forward-looking statements.  
In addition, the statements in this press release reflect our
expectations and beliefs only as of the date of this release. We
anticipate that subsequent events and developments will cause our
expectations and beliefs to change. However, while we may elect to
update these forward-looking statements publicly at some point in the
future, we specifically disclaim any obligation to do so, whether as
a result of new information, future events or otherwise, except as
may be required by law. Our forward-looking statements do not reflect
the potential impact of any acquisitions, mergers, dispositions,
business development transactions, joint ventures or investments that
we may make or enter into. These forward-looking statements should
not be relied upon as representing our views as of any date after the
date of this release. 
Trademarks 
LIXAR(R), ZYFLO CR(R) and ZYFLO(R) are registered trademarks of
Cornerstone Therapeutics Inc. CARDENE(R) I.V. and RETAVASE(R) are
registered trademarks of EKR Therapeutics, Inc., Cornerstone
Therapeutics' wholly-owned subsidiary. CUROSURF(R) is owned by Chiesi
Farmaceutici S.p.A. and is licensed to Cornerstone Therapeutics for
sales and marketing purposes in the United States. 


 
                                                                            
                       CORNERSTONE THERAPEUTICS INC.                        
               CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS                
              (In thousands, except share and per share data)               
                                                                            
                            Three Months Ended                              
                               December 31,         Year Ended December 31, 
                         ------------------------  ------------------------ 
                             2012         2011         2012         2011    
                                (Unaudited)                                 
Net revenues             $    34,927  $    18,206  $   116,084  $   101,422 
Costs and expenses:                                                         
  Cost of product sales                                                     
   (exclusive of                                                            
   amortization of                                                          
   product rights)            10,595        8,640       42,579       37,823 
  Selling, general and                                                      
   administrative             13,659        9,764       46,404       45,877 
  Research and                                                              
   development                   544          252        4,273        1,624 
  Amortization of                                                           
   product rights              4,155        3,591       17,929       14,368 
  Change in acquisition-                                                    
   related contingent                                                       
   payments                  (10,322)           -      (11,896)           - 
  Transaction-related                                                       
   expenses                      410          467        8,354          467 
  Other operating                                                           
   expenses, net              37,271            -       35,779        2,500 
                         -----------  -----------  -----------  -
---------- 
    Total costs and                                                         
     expenses                 56,312       22,714      143,422      102,659 
                         -----------  -----------  -----------  ----------- 
Loss from operations         (21,385)      (4,508)     (27,338)      (1,237)
Other expenses, net:                                                        
  Interest expense, net       (1,697)          (7)      (3,496)        (128)
  Other expense, net             (84)           -         (299)           - 
                         -----------  -----------  -----------  ----------- 
    Total other expenses      (1,781)          (7)      (3,795)        (128)
                         -----------  -----------  -----------  ----------- 
Loss before income taxes     (23,166)      (4,515)     (31,133)      (1,365)
Benefit from income                                                         
 taxes                        16,207        1,766       19,245          672 
                         -----------  -----------  -----------  ----------- 
Net loss                 $    (6,959) $    (2,749) $   (11,888) $      (693)
                         ===========  ===========  ===========  =========== 
                                                                            
Comprehensive loss       $    (6,959) $    (2,749) $   (11,888) $      (693)
                         ===========  ===========  ===========  =========== 
                                                                            
Net loss per share,                                                         
 basic                   $     (0.26) $     (0.11) $     (0.46) $     (0.03)
                         ===========  ===========  ===========  =========== 
Net loss per share,                                                         
 diluted                 $     (0.26) $     (0.11) $     (0.46) $     (0.03)
                         ===========  ===========  ===========  =========== 
Weighted-average common                                                     
 shares, basic            26,334,106   25,797,763   26,115,266   25,684,593 
                         ===========  ===========  ===========  =========== 
Weighted-average common                                                     
 shares, diluted          26,334,106   25,797,763   26,115,266   25,684,593 
                         -----------  -----------  -----------  ----------- 
                                                                            
                                                                            
                                                                            
                        CORNERSTONE THERAPEUTICS INC.                       
                         CONSOLIDATED BALANCE SHEETS                        
               (In thousands, except share and per share data)              
                                                                            
                                                                            
                                                 December 31,   December 31,
                                                     2012           2011    
Assets                                                                      
Current assets:                                                             
  Cash and cash equivalents                     $      56,250  $      73,968
  Accounts receivable, net                             14,368         11,894
  Inventories, net                                     11,384          9,419
  Prepaid expenses                                      3,343          3,753
  Income tax receivable                                 4,094          1,900
  Deferred tax asset                                    1,614              2
  Acquisition-related current assets                   11,134          5,618
  Other current assets                                    379            494
                                                -------------  -------------
    Total current assets                              102,566        107,048
                                                -------------  -------------
Property and equipment, net                             1,310          1,574
Product rights, net                                   232,111        106,960
Goodwill                                               33,356         15,218
Amounts due from related parties                            -             38
Deferred tax asset, less current portion                    -            523
Other assets                                               32            953
                                                -------------  -------------
    Total assets                                $     369,375  $     232,314
                                                =============  =============
                                                                            
Liabilities and Stockholders' Equity                                        
Current liabilities:                                                        
  Accounts payable                              $      12,439  $       5,526
  Accrued expenses                                     37,379         34,993
  Acquisition-related contingent payments               6,846              -
  Deferred revenue                                          -          1,428
  Acquisition-related current liabilities               9,636          6,618
  Other current liabilities                               525             90
                                                -------------  -------------
    Total current liabilities                          66,825         48,655
                                                -------------  -------------
Acquisition-related contingent payments, less                               
 current portion                                       26,362          8,800
Long-term debt                                         89,540              -
Deferred tax liability                                 15,683              -
Other long-term liabilities                             4,792             56
                                                -------------  -------------
    Total liabilities                                 203,202         57,511
                                                -------------  -------------
                                                                            
Stockholders' equity                                                        
  Preferred stock - $0.001 par value, 5,000,000                             
   shares authorized; no shares issued and                                  
   outstanding                                              -              -
  Common stock - $0.001 par value, 90,000,000                               
   shares authorized; 26,348,470 and 25,803,864                             
   shares issued and outstanding as of December                             
   31, 2012 and December 31, 2011, respectively            26             26
  Additional paid-in capital                          167,461        163,203
  (Accumulated deficit) retained earnings              (1,314)        11,574
                                                -------------  -------------
    Total stockholders' equity                        166,173        174,803
             
                                   -------------  -------------
    Total liabilities and stockholders' equity  $     369,375  $     232,314
                                                -------------  -------------
                                                                            
                                                                            
                                                                            
                       CORNERSTONE THERAPEUTICS INC.                        
                   CONSOLIDATED STATEMENTS OF CASH FLOWS                    
                               (In thousands)                               
                                                  Year Ended December 31,   
                                               ---------------------------- 
                                                    2012           2011     
                                               -------------  ------------- 
Cash flows from operating activities                                        
Net loss                                       $     (11,888) $        (693)
Adjustments to reconcile net loss to net cash                               
 provided by operating activities:                                          
  Amortization and depreciation                       18,660         14,896 
  Amortization of debt costs                              51              - 
  Provision for prompt payment discounts               3,474          3,448 
  Provision for other receivables                      1,457              - 
  Provision for inventory allowances                   1,277            209 
  Acquisition accounting adjustment on                                      
   inventory                                           4,178              - 
  CARDENE I.V. charitable inventory donation          11,662              - 
  RETAVASE inventory write-off                        14,586              - 
  Gain on sale of product rights                      (1,969)             - 
  Loss on disposal of property and equipment             299              - 
  Change in acquisition-related contingent                                  
   payments                                          (11,896)             - 
  Impairment of product rights                        11,500          2,500 
  Stock-based compensation                             2,961          2,207 
  Deferred revenue                                    (1,428)       (55,766)
  Benefit from deferred income taxes                 (16,062)          (388)
Changes in operating assets and liabilities:                                
  Accounts receivable                                  1,453         61,134 
  Inventories                                         (2,007)         5,546 
  Prepaid expenses and other assets                      231          8,528 
  Accounts payable, accrued expenses, and                                   
   other liabilities                                  (4,460)       (15,746)
  Acquisition-related current assets and                                    
   liabilities                                        (1,498)             - 
  Income taxes receivable                             (2,194)        (1,703)
                                               -------------  ------------- 
    Net cash provided by operating activities         18,387         24,172 
                                               -------------  ------------- 
Cash flows from investing activities                                        
Acquisition of businesses, net of cash                                      
 acquired                                           (126,921)             - 
Purchase of product rights                            (1,000)             - 
Purchase of property and equipment                      (275)          (616)
Proceeds from sale of product rights                   3,000              - 
                                               -------------  ------------- 
  Net cash used in investing activities             (125,196)          (616)
                                               -------------  ------------- 
Cash flows from financing activities                                        
Proceeds from term loans                              90,000              - 
Payment of debt financing costs                         (511)             - 
Proceeds from exercise of common stock options         1,159            369 
Excess tax benefit from stock-based                                         
 compensation                                            265            522 
Payments related to net settlement of                                       
 restricted stock                                       (127)             - 
Acquisition-related contingent payments               (1,603)             - 
Principal payments on license agreement                                     
 liability                                                 -         (1,341)
Principal payments on capital lease obligation           (92)           (83)
                                               -------------  ------------- 
  Net cash provided by (used in) financing                                  
   activities                                         89,091           (533)
                                               -------------  ------------- 
  Net (decrease) increase in cash and cash                                  
   equivalents                                       (17,718)        23,023 
Cash and cash equivalents as of beginning of                                
 year                                                 73,968         50,945 
                                               -------------  ------------- 
Cash and cash equivalents as of end of year    $      56,250  $      73,968 
                                               =============  ============= 
                                                                            
Supplemental disclosure of cash flow                                        
 information                                                                
Cash paid during the year for interest         $       3,059  $         177 
                                               =============  ============= 
Cash paid during the year for income taxes                 -  $       1,379 
                                               -------------  ------------- 
                                                                            
                                                                            
                                                                            
                       CORNERSTONE THERAPEUTICS INC.                        
               RECONCILIATION OF NON-GAAP FINANCIAL MEASURES                
                                                                            
                                                                            
The following tables reconcile our non-GAAP measures to the most directly   
 comparable GAAP financial measures (in thousands, except share and per     
 share amounts):                                                            
                                                                            
                           For the Three Months                             
                                   Ended              For the Year Ended    
                               December 31,              December 31,       
                         ------------------------  ------------------------ 
                             2012         2011         2012         2011    
                         -----------  -----------  -----------  ----------- 
GAAP loss from                                                              
 operations              $   (21,385) $    (4,508) $   (27,338) $    (1,237)
  Add: stock-based                                                          
   compensation                  934          621        2,961        2,207 
  Add: amortization and                                                     
   impairment of product                                                    
   rights                     15,655        3,591       29,429       16,868 
  Add: transaction-                                                         
   related expenses              410          467        8,354          467 
  Add: acquisition                                                          
   adjustments related                                               
       
   to inventory                1,117            -        4,178            - 
  Add: CARDENE I.V.                                                         
   charitable inventory                                                     
   donation                   11,662            -       11,662            - 
  Add: RETAVASE                                                             
   inventory write-off        14,586            -       14,586            - 
  Less: change in                                                           
   acquisition-related                                                      
   contingent payments       (10,322)           -      (11,896)           - 
  Less: gain on                                                             
   divestiture of                                                           
   product rights               (477)           -       (1,969)           - 
                         -----------  -----------  -----------  ----------- 
Non-GAAP income from                                                        
 operations              $    12,180  $       171  $    29,967  $    18,305 
                         ===========  ===========  ===========  =========== 
                                                                            
GAAP net loss            $    (6,959) $    (2,749) $   (11,888) $      (693)
  Add: stock-based                                                          
   compensation                  934          621        2,961        2,207 
  Add: amortization and                                                     
   impairment of product                                                    
   rights                     15,655        3,591       29,429       16,868 
  Add: transaction-                                                         
   related expenses              410          467        8,354          467 
  Add: acquisition                                                          
   adjustments related                                                      
   to inventory                1,117            -        4,178            - 
  Add: CARDENE I.V.                                                         
   charitable inventory                                                     
   donation                   11,662            -       11,662            - 
  Add: RETAVASE                                                             
   inventory write-off        14,586            -       14,586            - 
  Less: change in                                                           
   acquisition-related                                                      
   contingent payments       (10,322)           -      (11,896)           - 
  Less: gain on                                                             
   divestiture of                                                           
   product rights               (477)           -       (1,969)           - 
  Less: tax effects                                                         
   related to above                                                         
   items(1)                  (20,148)      (3,420)     (29,164)      (9,621)
                         -----------  -----------  -----------  ----------- 
Non-GAAP net income                                                         
 (loss)                  $     6,458  $    (1,490) $    16,253  $     9,228 
                         ===========  ===========  ===========  =========== 
                                                                            
GAAP net loss per share,                                                    
 diluted                 $     (0.26) $     (0.11) $     (0.46) $     (0.03)
                         -----------  -----------  -----------  ----------- 
Non-GAAP net income                                                         
 (loss) per share,                                                          
 diluted(2)              $      0.22  $     (0.06) $      0.59  $      0.35 
                         ===========  ===========  ===========  =========== 
                                                                            
Shares used in diluted                                                      
 net income (loss) per                                                      
 share calculation:                                                         
  GAAP net loss           26,334,106   25,797,763   26,115,266   25,684,593 
                         ===========  ===========  ===========  =========== 
  Non-GAAP net income                                                       
   (loss)                 30,813,848   25,797,763   28,669,855   26,232,333 
                         ===========  ===========  ===========  =========== 
                                                                            
                                                                            
(1) Income taxes typically represent a complex element of our consolidated  
statement of comprehensive (loss) income and effective tax rates can vary   
widely between different periods. As such, for the three months ended       
December 31, 2012 and the year ended December 31, 2012, we calculated non-  
GAAP net income by applying our statutory tax rate of 37.9% to non-GAAP     
income before taxes. The tax effects for 2012 periods represent the         
difference between our GAAP tax benefit and our calculated non-GAAP tax     
expense. Tax effects for the three months ended December 31, 2011 and the   
year ended December 31, 2011 were calculated using the effective tax rates  
of 73.1% and 49.2%, respectively.                                           
                                                                            
(2) The convertible term loan was determined to be dilutive to non-GAAP net 
income per share, diluted for the year ended December 31, 2012. As such, for
the year ended December 31, 2012, non-GAAP net income was adjusted for      
$645,000 of interest expense related to the convertible term loan, net of   
tax effects. Non-GAAP net income adjusted for the related interest expense, 
net of tax effects, was divided by the sum of the weighted-average number of
common shares and dilutive common share equivalents outstanding during the  
year, as adjusted for the impact of the shares related to the convertible   
debt of approximately 2.2 million shares for the year ended December 31,    
2012.                                                                       

  
Contacts  
Investor Relations Contact: 
Josh Franklin
Vice President
Strategy and Business Development
+1-919-678-6520
josh.franklin@crtx.com 
Media Relations Contact: 
Fleishman-Hillard
Andrea Moody
+1-919-457-0743
andrea.moody@fleishman.com 
 
 
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