QMed, Inc. Reports Profitable First Quarter Results of $0.06 per
share EATONTOWN, N.J., March 28 /PRNewswire-FirstCall/ -- QMed,
Inc. (Nasdaq Symbol: QMED) today announced financial results for
the first quarter ending February 28, 2005. Revenues for the three
months were $4,755,486 compared to $3,792,820 a year ago. Net
income was $874,803 or $0.06 per share compared to a loss of
$(262,414) or $(0.02) per share in the year earlier. The Company
had working capital of approximately $21,000,000 at February 28,
2005 compared to working capital of approximately $6,000,000 at
November 30, 2004. Michael W. Cox, president and CEO, said, "QMed
continued its strong financial performance in the first quarter and
we continue to project profit in our core business for the year.
The quarter witnessed additional significant financial events.
Since we believe that there are opportunities for meaningfully
expanding our business, we strengthened our financial position
significantly. As previously announced, we raised approximately
$13.9 million, net of expense, in new equity capital during the
quarter. We accomplished it in two private offerings of $8.3
million, net of expenses, in February and $5.6 million, net of
expenses, last December. And, as also announced earlier, we became
the first Disease Management firm successfully to complete the
audit of its internal controls as required under Section 404 of the
Sarbanes-Oxley Act." "In accordance with our strategic business
plan, we announced formation of QMedCare, Inc., and the hiring of
Jack Rohfritch as its president and CEO," he added. "Jack's
extensive health insurance background includes managing a $400
million HMO region as Senior Vice President for Cigna, as well as
engineering impressive operational and financial turnarounds for
other managed care organizations. These latter included CEO
experience in Medicare, commercial and Medicaid HMOs." "QMedCare is
a wholly owned subsidiary," Cox continued. "It will act as an
investor/holding company in affiliated companies. As we've
indicated, such affiliates are expected to operate as specialty
health plans or as firms that provide third party administration
services. QMedCare is the sole investor in QMedCare Dakota LLC, a
company specifically formed to administer a proposed Medicare
Capitated Disease Management Demonstration project in South
Dakota." "Also in the quarter, HeartPartners, our large scale
Medicare demonstration project, achieved increasing enrollment
which is key to success," he continued. "We have currently
randomized just over 6,000 heart failure patients into the project.
It is important to understand that enrolling elderly chronically
ill patients into randomized Medicare projects is a truly complex
matter. We believe that as a result of our experiences in
HeartPartners and in our first Medicare project, the Coordinated
Care Demonstration, we have developed industry-leading tactics to
overcome patient enrollment obstacles. But enrollment is just the
first step. It is essential that patients be engaged and we are
especially skilled at patient and physician engagement, critical
elements for any DM organization to succeed in Medicare as well as
for Medicare to achieve the health and financial improvements it
seeks and so clearly needs." "We are more confident than ever
before that QMed is increasingly well prepared for a successful
future. In large measure, this confidence reflects our conviction
that QMed is uniquely able to help reduce the country's already
enormous, continuously growing and obviously unsustainable
healthcare financial burden. We base our optimism on our years of
experience and on our carefully calibrated strategic positioning,"
Cox concluded. QMED, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED
BALANCE SHEETS ASSETS February 28, November 30, 2005 2004
(unaudited) Current assets Cash and cash equivalents $6,069,793
$3,292,571 Investments 14,754,795 2,097,362 Accounts receivable,
net of allowances of $52,690 and $52,690, respectively 3,043,805
2,750,507 Inventory, net of reserve 46,054 38,355 Prepaid expenses
and other current assets 278,872 440,620 24,193,319 8,619,415
Property and equipment, net of accumulated depreciation 1,100,133
1,180,050 Product software development costs, net 862,682 858,022
Non-current accounts receivable 44,827 -- Other assets 129,658
132,136 Investment in joint ventures 44,363 47,854 $26,374,982
$10,837,477 LIABILITIES AND STOCKHOLDERS' EQUITY Current
liabilities Accounts payable and accrued expenses $916,534 $817,234
Leases payable, current portion 113,605 119,757 Accrued salaries
and commissions 393,118 416,382 Fees reimbursable to health plans
29,290 161,178 Contract billings in excess of revenues 1,865,613
1,245,862 Deferred warranty revenue 20,555 23,652 Income taxes
payable 52,053 16,000 3,390,768 2,800,065 Leases payable - long
term 117,805 146,742 3,508,573 2,946,807 Commitments and
Contingencies Stockholders' equity Common stock $.001 par value;
40,000,000 shares authorized; 16,553,901 and 15,150,054 shares
issued and 16,531,901 and 15,128,054 outstanding, respectively
16,554 15,150 Paid-in capital 50,061,720 35,961,800 Accumulated
deficit (27,129,214) (28,004,017) Accumulated other comprehensive
income Unrealized loss on securities available for sale (7,026)
(6,638) 22,942,034 7,966,295 Less treasury stock at cost, 22,000
common shares (75,625) (75,625) Total stockholders' equity
22,866,409 7,890,670 $26,374,982 $10,837,477 QMED, INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) For the Three For the Three Months Ended Months Ended
February 28, February 29, 2005 2004 Revenue Disease Management
services $4,707,067 $3,739,221 Medical equipment 48,419 53,599
4,755,486 3,792,820 Cost of revenue Disease management services
1,783,574 1,963,985 Medical equipment 37,912 37,213 1,821,486
2,001,198 Gross profit 2,934,000 1,791,622 Selling, general and
administrative expenses 1,698,792 1,746,155 Research and
development expenses 268,026 254,419 Income (loss) from operations
967,182 (208,952) Interest expense (7,002) (6,698) Interest income
41,160 23,533 Loss in operations of joint venture (70,885) (75,000)
Other income 1,748 8,703 Income (loss) before income tax provision
932,203 (258,414) Provision for state income taxes (57,400) (4,000)
Net income (loss) $874,803 $(262,414) Basic earnings (loss) per
share Weighted average shares outstanding 15,837,577 14,644,546
Basic earnings (loss) per share $.06 $(.02) Diluted earnings (loss)
per share Weighted average shares outstanding 17,972,943 14,644,546
Diluted earnings (loss) per share $.05 $(.02) About QMed, Inc.
QMed, Inc., provides DM services to patients and physicians around
the country through its health plan customers. The Company has been
selected in two Medicare Demonstrations to test the feasibility of
reimbursing its care coordinated DM services in the vast Medicare
fee-for-service program. In addition, QMed is the largest DM
service provider to Medicare managed care plans. More information
on QMed, Inc. can be obtained at http://www.qmedinc.com/, by
calling (732) 544-5544 or by emailing . Except for historical
information contained herein, matters discussed in this news
release are forward-looking statements that involve risks and
uncertainties. They include but are not limited to those relating
to the timely implementation of programs, the impact of competitive
product introductions, acceptance and pricing, and those risks
detailed in the Company's filings with the Securities and Exchange
Commission (SEC). Actual results may differ materially from any
forward-looking statements due to these risks and uncertainties.
DATASOURCE: QMed, Inc. CONTACT: Robert Mosby, QMed, Inc.,
+1-732-544-5544, ext. 1107 Web site: http://www.qmedinc.com/
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