Cipher Pharmaceuticals (CPH) Planet MicroCap Showcase: VANCOUVER 2024 summary

Pre-acquisition business overview

• Canadian portfolio generates $13 million annually, led by Epuris for severe acne with 46% market share and 20% annual growth.

• U.S. portfolio includes Absorica, Lipofen, and ConZip, generating $8.5 million in royalties annually; stable, low-growth segment.

• EBITDA margins are around 60%, providing strong cash flow and stability.

Acquisition of Natroba

• Acquired Natroba product line and U.S. commercial infrastructure with 35 sales reps at the end of July for $90 million.

• Natroba holds 23% of the $165 million U.S. antiparasitic market, with FDA approvals for head lice and scabies and a unique complete cure rate designation.

• Product benefits from 15-year exclusivity on its active ingredient, spinosad.

• Main competitor permethrin faces widespread resistance, creating growth opportunity for Natroba.

Growth strategy and market expansion

• Plans to gain U.S. market share from permethrin and launch Natroba in Canada pending Health Canada approval (expected in 12 months).

• Out-licensing discussions underway for Europe and Asia, with royalties expected to contribute to bottom line.

• Combined business has doubled sales and EBITDA post-acquisition.

• Strategy includes adding complementary products for the sales force and potentially selling U.S. products directly to increase margins.