"With an earlier-than-anticipated Caldolor® launch, we were able to dramatically exceed our earnings expectations in the third quarter. Additionally, the completion of our initial public offering in August provides us with the strongest balance sheet in the history of the company,” Cumberland Pharmaceuticals CEO A.J. Kazimi said in announcing third quarter results on Nov. 10, 2009.
For the three months that ended on Sept. 30, the company’s net revenue was up 58 percent compared to the same period in 2008. Officials attributed the growth to the September launch of their IV pain and fever treatment Caldolor Injection (ibuprofen) and an increase in volume for Acetadote Injection (acetylcysteine).
In August 2009, Cumberland completed its initial public offering of 5,000,000 shares of common stock at a price to the public of $17 per share, raising $85 million in gross proceeds. Net proceeds to Cumberland Pharmaceuticals were $74.8 million after commissions and offering expenses. The proceeds from this offering are being used primarily for potential acquisitions, the launch of Caldolor, expansion of the company's hospital sales force, product development, debt repayment and general corporate purposes. Cumberland's common stock began trading on the NASDAQ Global Select Market on Aug. 11, 2009, under the trading symbol "CPIX."
Beleaguered pharmacy giant CVS Caremark ended the year on a down note. Following the 2007 merger of CVS, the leading retail pharmacy, and Caremark, the nation’s second largest pharmacy benefits manager, the combined company has come under attack by some health plans, independent pharmacists, politicians and consumer groups for alleged anti-competitive and anti-privacy business practices.
This summer, two groups of U.S. Senators — Mark Pryor (D-Ark.) and Roger Wicker (R-Miss.); and Byron Dorgan (D-ND), Russell Feingold (D-Wis.) and Amy Lobuchar (D-Minn.) — sent a letter urging the Federal Trade Commission to thoroughly review CVS Caremark’s business practices. Concerns since the merger include the potential for abuse with the combined retail-PBM business model allowing the company to enjoy negotiated savings from the prescription drug distribution chain without passing those savings along to health plans or consumers, a breach of privacy information between the PBM side and retail pharmacy side, and a push for consumers to purchase more expensive brand name drugs.
“The key to a thriving free marketplace is competition on a level playing field. Before the merger was approved, company officials pledged to be 'agnostic as to where the consumer fills their prescription.' Their actions tell a different story. Patients complain of higher prices, coercive marketing tactics and privacy violations. That’s why it is so encouraging to see these Senators step up for patients and ask the FTC to exercise its investigative and regulatory powers,” Bruce T. Roberts, RPh, CEO and executive vice president of the National Community Pharmacists Association, said in a statement.
In a Nov. 5 10-Q securities filing, CVS Caremark confirmed it is the subject of an FTC investigation into some of its business practices, but officials declined to say which practices are under review. Company spokespersons have maintained CVS Caremark is confident that it is in compliance with antitrust laws. Following on the heels of the FTC news and a third-quarter announcement of a multi-billion dollar loss of contracts, the company’s shares dropped 21 percent but had rebounded slightly by mid-November.