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Product / Company Performance

Anika Therapeutics Reports 3Q18 Revenue of $24.1MM, +0.4% vs. 3Q17 -


Anika Therapeutics, a company specializing in pain management and tissue regeneration, navigated a challenging viscosupplement market to post 3Q18 orthobiologic revenue of $24.1MM, +0.4% vs. 3Q17. Viscosupplementation is employed via injection to replace hyaluronic acid in knee joints affected by osteoarthritis. The company continues its evolution from a contract manufacturer to an integrated commercial company.


U.S. Market Pressures Offset by International Growth

Viscosupplement sales in the U.S. remain challenged due to negative price pressure and increasing payor control at national and regional levels. Anika Chief Financial Officer Sylvia Cheung noted that both ORTHOVISC and MONOVISC product prices continued to decline in 3Q18, with total price impact in the single digits vs. 3Q17. This pricing pressure was offset by an increase in patient volume with the company’s viscosupplement products. Globally, Anika’s viscosupplement revenue grew 2% in 3Q18, driven primarily by growth in international markets. Leadership called out continued international momentum for CINGAL, a cross-linked hyaluronic acid plus steroid designed to treat osteoarthritis symptoms, which exhibited 70% revenue growth year-to-date. The company’s ex-U.S. performance reflects its focus on accountability and execution in those markets, directed by James Chase, the recently-hired VP of International Sales.

  3Q18 3Q17 $ Change % Change
Orthobiologics $24.1 $24.0 $0.1 0.4%


  YTD18 YTD17 $ Change % Change
Orthobiologics $69.8 $68.7 $1.1 1.6%


3Q18 Revenue Estimated by Geographic Region

Improved international performance is a key component of Anika’s near-term strategic plans. Led by the VP of International Sales, the company continues to assess and optimize ex-U.S. operations. Within the quarter, they added four new international distributors and expanded the reach of their viscosupplement business in Europe, Asia and South America. 

Geographic Region 3Q18 3Q17 $ Change % Change
US $19.5 $19.7 -$0.2 -0.8%
Ex-US $4.6 $4.3 $0.3 6.0%
   Europe $2.9 $2.4 $0.5 20.5%
   Other $1.7 $1.9 -$0.2 -12.1%
Grand Total  $24.1 $24.0 $0.1 0.4%


Evolving into a Commercial Company

Anika CEO Joseph Darling highlighted the company’s continued evolution from a contract manufacturer with “little control over its own destiny” into an integrated commercial company. Anika has made significant progress on this strategy. The company’s total licensing, milestone and contract revenue has decreased from $5.1MM in the first nine months of 2017 to ~$0.02 MM in the first nine months of 2018. 

This integrated commercial process is being pursued through three strategies: structuring new partnerships with more favorable economics and greater control over market access, actively focusing on smaller tuck-in acquisitions to complement Anika’s existing portfolio and partnering with an established orthopaedic salesforce to create a hybrid commercial model. Per leadership, this hybrid salesforce of six to 10 reps would integrate with existing clinical marketing specialists and target large teaching institutions in the U.S. 

The current outlook for Anika’s orthobiologics franchise is positive, with revenues expected to increase in 4Q18. We project 2018 orthobiologic revenue of $94.4MM, +0.6% vs. 2017.

Pre-Clinical, Clinical Trial and FDA Update:

  • The company recently completed an initial prototype for its second surgically delivered regenerative therapy for rotator cuff repair. The product can be used for both partial and full fitness rotator cuff tears and Anika views it as a potentially significant growth opportunity.
  • Anika continues to pursue multiple strategies to move toward approval of CINGAL in the U.S. A meeting with FDA is scheduled for 1Q19.
  • In the coming months the company will commence a postmarket study of ORTHOVISC-T, a product to relieve pain and restore function to tendons damaged by chronic tennis elbow, in Europe to collect clinical information. Anika will also initiate a Phase III clinical trial in the U.S. to seek approval.
  • The company is continuing to pursue strategies to accelerate enrollment of the HYALOFAST Phase III clinical trial.


Net Earnings

Gross margins decreased year-over-year due to higher production costs, the 1Q18 voluntary recall of HYALOFAST, HYALOGRAFT-C, and HYALOMATRIX, and price pressure in the U.S. viscosupplement market. Likewise, operating expenses increased year-over-year due to higher production costs, personnel and professional costs. These increases were offset by the reduction of R&D costs as trials reached completion as well as other cost efficiency measures. Note, Anika’s net earnings data below includes all revenue, not just orthobiologics.

3Q18 Amount ($MM) % Sales
Sales $26.8  
   Administrative -$5.7 21.3%
   Cost of Goods -$8.3 30.9%
   Other -$1.0 3.6%
   R&D -$4.2 15.8%
Net Earnings  $7.6 28.4%


Sources: Anika Therapeutics; ORTHOWORLD estimates

Mike Evers is ORTHOWORLD’s Market Analyst. He can be reached by email.

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