Business context and reporting period
This is Retrophin, Inc.’s unaudited Form 10-Q for the quarter ended September 30, 2019—not a filing under the Travere Therapeutics name. Retrophin was a rare-disease biopharmaceutical company, with three marketed products and sparsentan in Phase 3 trials for FSGS and IgAN. Its shares traded as RTRX.
Financial performance and liquidity
Amounts below are in millions of dollars, except per-share data.
| Metric | Q3 2019 | Q3 2018 | Nine months 2019 | Nine months 2018 |
|---|---|---|---|---|
| Net product sales | $44.4 | $40.7 | $128.7 | $120.5 |
| Operating loss | $(34.4) | $(35.6) | $(109.2) | $(75.1) |
| Net loss | $(36.5) | $(54.5) | $(116.2) | $(95.2) |
| Basic and diluted loss per share | $(0.85) | $(1.34) | $(2.76) | $(2.37) |
| Cash used in operating activities | — | $(53.7) | $(21.4) |
- Q3 sales rose $3.7 million year over year: bile acid products contributed $19.9 million and tiopronin products $24.4 million. Management attributed growth to increased patient counts and timing of new patient starts and refills.
- At September 30, cash and cash equivalents were $65.2 million and marketable securities were $341.8 million, totaling $407.0 million, versus $471.5 million at year-end 2018. Working capital was $351.7 million; the current ratio was 5.00.
- Total assets were $613.8 million and stockholders’ equity was $246.0 million. Net intangible assets were $157.8 million.
- The 2025 convertible notes had $276.0 million principal outstanding and a $202.4 million net carrying value; they bear 2.50% stated interest and mature in 2025. The remaining $22.6 million principal of 2019 notes converted into about 1.3 million common shares in May 2019.
- Nine-month investing activities provided $18.3 million, mainly reflecting marketable-security maturities and purchases. Financing activities used $2.2 million. Cash and cash equivalents declined $37.7 million from year-end.
Changes, outlook, risks and unusual items
- For the first nine months, R&D expense increased $13.1 million to $104.6 million, primarily due to sparsentan Phase 3 trials and the discontinued FORT study. SG&A rose $23.7 million to $101.4 million, attributed to higher compensation and legal expenses.
- Q3 included a $15.0 million impairment of the Censa investment after Retrophin declined to acquire Censa and discontinued CNSA-001 development. In Q1, discontinuing L-UDCA led to a $25.5 million intangible-asset impairment and reversal of $18.0 million contingent consideration, a net $7.5 million noncash charge.
- The Phase 3 FORT study of fosmetpantotenate in PKAN failed to meet its primary and secondary endpoints; the company said it would stop development. Sparsentan’s DUPLEX FSGS interim topline data were expected in the first half of 2021; PROTECT IgAN primary-endpoint topline data were expected in the first half of 2022. These were expectations, not results or guarantees of approval.
- Management said available cash and short-term investments were expected to fund anticipated operations for at least 12 months. No formal revenue or earnings guidance is provided in the supplied filing text. Management noted funding needs depend on sales, clinical-trial spending, debt service and other factors.
- Material risks include clinical and regulatory uncertainty for sparsentan, generic competition and pricing/reimbursement pressure, reliance on third-party manufacturers and distributors, and the company’s ongoing losses and operating cash use. Retrophin disclosed a Spring Pharmaceuticals lawsuit alleging antitrust and unfair-competition conduct related to access to Thiola samples; it intended to defend the case, had accrued no amount, and said the outcome could not be determined. The FTC had also requested information about marketing, sales, distribution and pricing; the filing said no FTC claim or proceeding had been initiated.
- The company reported effective disclosure controls and no significant quarter-end change in internal control over financial reporting. The 2025 notes’ estimated fair value was $206.7 million; a hypothetical 1% adverse interest-rate move was estimated to reduce marketable-security value by about $1.8 million if sold.
Investor verification priorities
- Confirm the issuer and period: the supplied filing is Retrophin’s Q3 2019 10-Q, not a filing labeled Travere Therapeutics.
- Track sparsentan trial progress, endpoint results, regulatory feedback, and whether the stated data timelines changed.
- Assess product-sales durability and potential generic, reimbursement, and pricing impacts, particularly for Thiola.
- Reconcile cash and marketable-security balances with operating cash burn, contingent obligations, lease commitments, and the $276.0 million notes’ conversion or repayment terms.
- Monitor outcomes and financial exposure from the Spring litigation, FTC inquiry, and insurance reimbursement uncertainty related to advanced legal fees.