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Rockwell Medical Reports Third Quarter 2011 Results

November 3, 2011 at 7:00 AM EDT

WIXOM, Mich., Nov. 3, 2011 (GLOBE NEWSWIRE) -- Rockwell Medical (Nasdaq:RMTI), a fully-integrated biopharmaceutical company targeting end-stage renal disease (ESRD) and chronic kidney disease (CKD) with innovative products and services for the treatment of iron deficiency and secondary hyperparathyroidism, today announced results for the third quarter ended September 30, 2011.

Third Quarter Financial Highlights

  • Sales were $12.0 million; $2.7 million less than third quarter 2010 due primarily due to lower international sales.
  • Sales increased 1.5% sequentially over the second quarter of 2011.
  • Gross profit was $1.4 million; $1.0 million less than third quarter of 2010 due to lower sales volumes and inflationary cost increases.
  • SG&A decreased 6.6% from the third quarter of 2010 due to lower non-cash charges for equity compensation.
  • R&D expense increased to $4.2 million, compared to $0.7 million in third quarter of 2010.
  • Net loss was ($5.0) million, compared to a net loss of ($0.7) million in third quarter of 2010.

First Nine Months 2011 Financial Highlights

  • Sales were $37.1 million; $8.2 million less than first nine months of 2010 primarily due to lower international sales.
  • Completed a multi-year supply agreement with our largest domestic customer through 2013.
  • Gross profit was $4.1 million; $3.4 million less than first nine months of 2010 due to lower sales volumes and higher material and fuel costs.
  • SG&A remained relatively unchanged from the first nine months of 2010.
  • R&D expense increased significantly to $9.9 million, compared to $1.7 million in the first nine months of 2010, due to the start of our two Phase III efficacy studies for SFP.
  • Net loss was ($12.5) million, compared to a net loss of ($1.0) million in first nine months of 2010.
  • Cash and short term investments aggregated $20.2 million at September 30, 2011.

Drug Development Highlights

  • Two Phase III CRUISE efficacy studies enrolling patients.
  • PRIME study to capture ESA-sparing data enrolling patients.
  • Hired Annamaria Kausz, M.D. as Vice President of Drug Development & Medical Affairs.
  • Manufacturer chosen to produce Calcitriol (Active Vitamin-D) injection.

Mr. Robert L. Chioini, Chairman and CEO stated, "We continue to place focus on enrolling patients into both of our CRUISE studies as well as our PRIME study. Our hire of Dr. Kausz strengthens our team considerably and gives us further confidence of achieving success in attaining FDA market approval for SFP. We have also chosen a manufacturer to supply our newly acquired Calcitriol vitamin D product; we estimate entering that commercial market in the back-half of 2012. Mr. Chioini further stated, "Our third quarter operating performance was in line with our projections. Gross profit margins were up 2.4 points sequentially over second quarter 2011."

Conference Call Information:

Rockwell Medical will be hosting a conference call to review its 2011 third quarter results on Thursday, November 3, 2011 at 8:30 am ET. Investors are encouraged to call a few minutes in advance at (877) 383-7438 or to listen to the call on the web at:

About Rockwell Medical:

Rockwell Medical is a fully-integrated biopharmaceutical company offering innovative products and services targeting end-stage renal disease (ESRD), chronic kidney disease (CKD), and iron deficiency anemia. The Company is currently developing unique, proprietary renal drugs to treat anemia and secondary hyperparathyroidism.  Rockwell's lead drug candidate for iron therapy treatment is called SFP.  SFP delivers iron in a non-invasive, physiologic manner to dialysis patients via dialysate during their regular dialysis treatment.  SFP is currently in ongoing Phase III clinical trials (CRUISE-1 and CRUISE-2) and addresses a $600M U.S. market.  Rockwell's Calcitriol (Active Vitamin D) injection for treating secondary hyperparathyroidism is expected to be available commercially in the back-half of 2012, addressing a $350M U.S. market. 

Rockwell is also an established manufacturer and leader in delivering high-quality hemodialysis concentrates/dialysates to dialysis providers and distributors in the U.S. and abroad. These products are used to maintain human life by removing toxins and replacing critical nutrients in the dialysis patient's bloodstream.  Rockwell's operating business is designed as a ready-made sales and distribution channel for seamless integration into the commercial markets for its drug products, Calcitriol in 2012 and SFP upon FDA market approval. 

Rockwell's exclusive renal drug therapies support disease management initiatives to improve the quality of life and care of dialysis patients and are intended to deliver safe and effective therapy, while decreasing drug administration costs and improving patient convenience.  Rockwell Medical is developing a pipeline of drug therapies, including extensions of SFP for indications outside of hemodialysis. Please visit for more information. For a demonstration of SFP's unique mechanism of action in delivering iron via dialysate, please view the animation video at

The Rockwell Medical Technologies, Inc. logo is available at

Certain statements in this press release constitute "forward-looking statements" within the meaning of the federal securities laws. Words such as "may," "might," "will," "should," "believe," "expect," "anticipate," "estimate," "continue," "predict," "forecast," "project," "plan", "intend" or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward-looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation those set forth in Rockwell Medical's SEC filings. Thus, actual results could be materially different. Rockwell Medical expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.

For the three and nine months ended September 30, 2011 and September 30, 2010
  Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended
   Sept. 30, 2011 Sept. 30, 2010  Sept. 30, 2011 Sept. 30, 2010
Sales  $11,976,329 $14,745,414 $37,069,423 $45,232,078
Cost of Sales  10,600,144 12,345,221 32,970,644 37,746,691
 Gross Profit  1,376,185 2,400,193 4,098,779 7,485,387
Selling, General and Administrative  2,271,350 2,431,367 6,890,500 6,847,606
Research and Product Development  4,221,118 727,978 9,937,476 1,686,666
 Operating Income (Loss)  (5,116,283) (759,152) (12,729,197) (1,048,885)
Interest and Dividend Income  77,107 17,257 240,617 37,641
Interest Expense  408 1,462 1,513 8,876
 Income (Loss) Before Income Taxes  (5,039,584) (743,357) (12,490,093) (1,020,120)
Income Tax Expense  1,958  --  1,958  -- 
 Net Income (Loss)  $(5,041,542) $(743,357) $(12,492,051) $(1,020,120)
Basic Earnings (Loss) per Share  ($.28) ($.04) ($.71) ($.06)
Diluted Earnings (Loss) per Share  ($.28) ($.04) ($.71) ($.06)
As of September 30, 2011 and December 31, 2010
  September 30, 2011 December 31,
 ASSETS   (unaudited) 2010
Cash and Cash Equivalents  $8,421,915 $12,263,449
Investments Available for Sale  11,813,813 11,938,098
Accounts Receivable, net of a reserve of $27,000 in 2011 and $23,000 in 2010  4,258,403 4,507,296
Inventory  2,234,685 2,936,878
Other Current Assets  1,373,083 1,020,647
 Total Current Assets  28,101,899 32,666,368
Property and Equipment, net  2,458,987 3,049,513
Intangible Assets  839,676 166,657
Goodwill  920,745 920,745
Other Non-current Assets  2,269,158 163,624
 Total Assets  $34,590,465 $36,966,907
Capitalized Lease Obligations  $8,662 $18,215
Accounts Payable  3,609,235 3,659,507
Accrued Liabilities  5,892,021 2,577,022
Customer Deposits  114,778 165,476
 Total Current Liabilities  9,624,696 6,420,220
Capitalized Lease Obligations  3,078 8,750
 Shareholders' Equity:    
Common Shares, no par value, 18,502,901 and 17,513,608 shares issued and outstanding  65,290,668 57,017,236
Common Share Purchase Warrants, 2,707,440 and 3,338,569 warrants issued and outstanding  7,067,924 8,275,509
Accumulated Deficit  (47,033,236) (34,541,185)
Accumulated Other Comprehensive Loss  (362,665) (213,623)
 Total Shareholders' Equity 24,962,691 30,537,937
 Total Liabilities And Shareholders' Equity  $34,590,465 $36,966,907
For the nine months ended September 30, 2011 and September 30, 2010
  2011 2010
Cash Flows From Operating Activities:    
 Net (Loss)  $(12,492,051) $(1,020,120)
 Adjustments To Reconcile Net Loss To Net Cash Used In    
 Operating Activities:    
 Depreciation and Amortization  928,208 1,047,077
 Loss on Disposal of Assets  27,572 16,822
 Share Based Compensation — Non-employee Warrants  105,274 588,201
 Share Based Compensation — Employees  3,024,647 2,392,688
 Changes in Assets and Liabilities:    
 Decrease (Increase) in Accounts Receivable  248,893 (1,143,912)
 Decrease in Inventory  702,193 553,708
 (Increase) in Other Assets  (2,457,970) (514,244)
 Decrease in Accounts Payable  (50,272) (545,538)
 Increase (Decrease) in Other Liabilities  2,714,301 (102,062)
 Changes in Assets and Liabilities  1,157,145 (1,752,048)
 Cash Provided By (Used) In Operating Activities  (7,249,205) 1,272,620
Cash Flows From Investing Activities:    
Purchase of Equipment  (344,250) (682,295)
Proceeds on Sale of Assets  -- 800
Purchase of Intangible Assets  (144,023) --
Purchase of Investments Available for Sale  (24,757)  --
 Cash Used In Investing Activities  (513,030) (681,495)
Cash Flows From Financing Activities:    
 Issuance of Common Shares and Exercise of Purchase Warrants  3,935,926 54,948
 Payments on Notes Payable  (15,225) (27,040)
 Cash Provided By (Used) In Financing Activities  3,920,701 27,908
Increase (Decrease) In Cash and Cash Equivalents  (3,841,534) 619,033
Cash and Cash Equivalents at Beginning of Period  12,263,449 23,038,095
Cash and Cash Equivalents at End of Period  $8,421,915 $23,657,128
CONTACT: Michael Rice

         Investor Relations

         201-408-4923 / 917-282-3242

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Source: Rockwell Medical Technologies, Inc.

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