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Mayne Pharma reports $92 million loss

Business

Adelaide-based pharmaceutical company Mayne Pharma has reported a $92.8 million loss for the 2020 financial year, driven by asset write downs in its generic medicines business.

 

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The Salisbury South company, which also has significant operations in the United States, reported a 13 per cent fall in revenues to $457 million. This was impacted by COVID-19 through lower patient visits to physicians during lockdowns resulting in a fall in prescriptions.

The company recently announced a licensing agreement with a Belgian-based biotech company to manufacture a novel contraceptive pill, which it hopes will help turn around its fortunes from late 2021.

Mayne Pharma CEO Scott Richards said the non-cash intangible asset impairment of the generic portfolio reflected ongoing challenging competitive market dynamics of the US generic marketplace.

“While the COVID-19 pandemic has presented unprecedented challenges to our business, we have focused on ensuring the health and safety of our employees and maintaining an uninterrupted supply of medicines and services to our customers and patients around the world,” he said.

“Pleasingly, generic products stabilised in the second half, reporting stronger gross profit than the first half.

“Specialty Brands, however, was impacted by new competition in the acne and psoriasis space, the COVID-19 pandemic dampened prescribing, and managed care continued to tighten.

“In FY20, we have focused on repositioning our business for growth by restructuring our cost base, rationalising our generic portfolio and investing in sustainable products, distribution channels and therapeutic areas.”

The loss is a significant improvement on last year when it reported a $280 million loss for 2018/19.

Mayne Pharma this year completed licensing for its new oral contraceptive pill NEXTSTELLIS in the US and Australia and hopes to gain approval from the FDA in the US and Australia’s Therapeutic Goods Administration to launch the product in the second half of 2021.

The hormonal contraceptive market is worth more than $5 billion in the US and $70 million in Australia

“NEXTSTELLIS will compete in the short-acting contraceptive market in which more than 10 million American women and 1 million Australian women use combination (estrogen + progestin) oral pills, patches or vaginal rings,” the company said in a statement to the Australian Securities Exchange this morning.

“The key strategic priority is to return to growth through repositioning the company into sustainable products, distribution channels and therapeutic areas.

“Key drivers of this transformation are expected to be the successful commercialisation of key pipeline products pending at the FDA, realising committed cost savings from new supply agreements and efficiencies in the manufacturing network and expanding sales in alternate non-retail channels.”

Mayne Pharma’s share price was as high as $1.28 in October 2018 before steadily falling on the back of a series of poor results to bottom out at $0.19 on March 19 during the sharp COVID-19 market downturn. It rose again to reach $0.47 in June but was down 3 per cent this morning to $0.33 following today’s announcement.

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