Depomed Inc. fell more than 12% in late trading Monday after a disappointing quarterly earnings report that showed weaker than expected sales for the company's two biggest drugs. Depomed reported a net loss of $12.9 million, or 21 cents a share, on sales of $110.5 million; after adjustments for stock-based compensation and other factors, Depomed claimed profit of 28 cents a share. Analysts polled by FactSet expected Depomed to report adjusted profit of 35 cents a share on sales of $126.8 million. The shortfall came from weak sales of painkillers Nucynta and Gralise, which came in at $65.3 million and $20.6 million, well below projections from Depomed and analysts. "Although our third quarter revenues increased by 5% over the previous year's quarter, they did not meet our expectations, as several factors, including a disconnect between prescription demand and wholesaler shipments, influenced net sales of the Nucynta franchise and Gralise," Chief Executive Jim Schoeneck explained in Monday's announcement. Depomed shares -- which have been volatile all year due to an activist-investor campaign, acquisition attempt, a big court win and reports of a potential sale effort -- fell to less than $20.50 in late trading, after closing with a 1% gain at $22.89.
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