Good afternoon, and welcome to Cumberland Pharmaceuticals' third quarter 2022 financial report and company update. This call is being recorded at Cumberland Pharmaceuticals' request and will be archived on the company's website for one year from today's date. I would now like to turn it over to Molly Aggas, Account Supervisor at The Dalton Agency, who handles Cumberland Pharmaceuticals' communications. Molly, please go ahead.
Hello, everyone, and good afternoon. Thanks for joining today's call. Earlier this afternoon, Cumberland issued a press release containing financial results for the third quarter of 2022, along with the company update. The release, which includes the related financial tables, can be found on Cumberland's website at www.cumberlandpharma.com. Company management will share an overview of those financial results during today's call. They'll also provide an overall company update, including a discussion of its brands, pipeline, and partners. Participating in today's call are A.J. Kazimi, Cumberland's Chief Executive Officer, and John Hamm, Chief Financial Officer. Please keep in mind that their discussions may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements reflect the company's current views and expectations concerning future events and may involve risks and uncertainties.
Additionally, there are many factors that could affect Cumberland's future results, including natural disasters, economic downturns, public health epidemics, international conflicts, and others that are beyond the company's control. Those issues are described under the caption Risk Factors in Cumberland's Form 10-K and any additional updates filed with the SEC. Any forward-looking statements made during today's call are qualified by those risk factors. Despite the company's best efforts, actual results may differ materially from expectations, so information shared on this call should be considered current as of today only. Please remember that the company isn't responsible for updating any forward-looking statements, whether as a result of new information or due to future developments. During today's call, there will be references to several of Cumberland's marketed brands.
Full prescribing and safety information for each brand is included on the individual product websites, and the links to those sites can be found on the corporate website at www.cumberlandpharma.com. The company will also provide some non-GAAP financial measures with respect to performance. An explanation and reconciliation to GAAP measures can be found in the financial tables in the earnings release that was issued earlier this afternoon. If you have any questions, please hold them until the end of the call, at which point we'll be happy to answer them. With that overview, I'll turn the call over to Cumberland's Chief Executive Officer, A.J. Kazimi.
Thank you, Molly, and good afternoon, everyone. We appreciate you joining us. As you'll hear today, we had another active and productive quarter here at Cumberland. We'll provide an update on the latest developments and review our financial results for the third quarter 2022. Let's get started. I'm pleased to report that Cumberland had a very successful third quarter, delivering on our goal of double-digit revenue growth for the period. Our line of FDA-approved brands generated $11.4 million in revenue and $1.4 million in adjusted earnings, or $0.10 a share. Our sales organization continues to navigate the challenges in the marketplace, and we are starting to see a return to a more typical selling environment. However, we are still seeing staffing shortages at hospitals, clinics, and physician offices, which are impacting the number of patient procedures and the facility visits.
Still, we experienced strong year-over-year financial performance led by contributions from our newest brand, Sancuso. It's off to a great start, and we're supporting the product through our new sales division, Cumberland Oncology. During the third quarter, we largely completed the transition of Sancuso from Kyowa Kirin to here at Cumberland. We've now assumed full commercial responsibility for the product in the U.S., including its marketing, its promotion, distribution, and medical support activities. Already, we've seen Sancuso quickly becoming one of our most important brands and a significant contributor to our business. To fund this acquisition, recall we extended our bank line of credit for a new three-year term and expanded that facility to provide up to $20 million in capital. Sancuso is the first and only FDA-approved prescription patch for the prevention of nausea and vomiting in patients receiving certain types of chemotherapy treatment.
By addressing these issues, we can help patients tolerate and continue the needed treatment for their cancers. To support Sancuso, as I mentioned, we formed a new specialty sales division, Cumberland Oncology, and we also entered into a new co-promotion agreement with Verity Pharmaceuticals to feature Sancuso through their national oncology sales organization. Verity's team completed their training and then launched their promotion during the third quarter. Verity will promote the product across the U.S. for an initial 3-year term with an option to extend for an additional 2 years. Verity and Cumberland will share in the incremental contribution margin resulting from their efforts.
Our teams are working closely on joint marketing and sales initiatives, and we look forward to expanding the number of cancer patients who can benefit from this brand. With the addition of Sancuso sales, our product portfolio delivered combined revenues of $11.4 million during the third quarter, a 41% increase over the same prior year period. Adjusted earnings for the third quarter were $1.4 million or $0.10 a share. While year-to-date cash flow from operations was $5.6 million, a 28% increase over the same period last year. As a result of the Sancuso acquisition, our total assets grew to $91 million by the end of the third quarter, including $19.5 million in cash. Total liabilities were $53 million, including $17.7 million on our revolving line of credit.
Shareholders' equity was $38 million as of September 30, 2022. Now I typically hand the call over to our Vice President, Todd Anthony, for an update on our team and our brands. Unfortunately, Todd is out today recovering from a recent elective surgery. We wish him well, and I'll go ahead and give a brief update on his behalf. I'd first like to touch on Vibativ, our potent injectable antibiotic designed to treat certain serious bacterial infections, including hospital-acquired or ventilator-associated pneumonia, as well as complicated skin infections. Earlier this year, our marketing and sales leadership took a fresh look at how we can best support Vibativ, and then launched a series of new initiatives to increase the brand's awareness and use of this important, potentially life-saving brand.
Based on the implementation of those initiatives, we are beginning to now see an improvement in the brand's performance. Next, I'd like to discuss Kristalose, our prescription-strength laxative packaged in a convenient pre-measured powder dose, which dissolves quickly in just four ounces of water, providing a clear, taste-free, and grit-free solution. Kristalose continues to benefit from the support of our co-promotion partners who feature the brand with physicians at facilities that Cumberland does not cover. The award-winning marketing campaign has also been refreshed for 2022 to support increased engagement with our customers, and we've expanded patient support for the brand, which has recently been added to the GoodRx platform.
Turning now to Caldolor, I'd like to remind you that late last year we received FDA approval for its use just prior to surgery, which results in patients waking up from the procedures in significantly less pain and also needing significantly fewer opioids. We continue to see growth in our ready-to-use presentation of Caldolor as more patients return for elective surgeries. Additionally, international shipments have contributed nicely to the brand's performance over the year. I'd now like to touch on our newest product in the portfolio, Sancuso, which I did mention earlier. You see when Sancuso applied 24-48 hours before receiving chemotherapy, it can help prevent nausea and vomiting for up to five consecutive days.
Now, alternative oral treatments must be taken several times a day during this five-day period to deliver the same therapeutic doses, and they can be difficult for some patients who are experiencing nausea when they try to swallow. We're very excited about and believe in the potential of Sancuso, and we're honored to deliver it to cancer patients throughout the country. Next, I'd like to share an update on our RediTrex product line, which we launched in the fourth quarter of last year. It's our methotrexate line of prefilled syringes designed for the safe, simple treatment of active rheumatoid, juvenile idiopathic, and severe psoriatic arthritis. These prefilled syringes assure accurate and safe dosing with an automatic retractable extra thin 29-gauge needle that reduces pain as well as the risk of needle sticks.
While RediTrex sales last year and early this year were limited, as our initial stocking of the product began moving through the distribution channels, quarterly prescriptions for the product are now growing steadily, and that's resulting in an increase in our shipments and our quarterly sales. As we announced during our prior earnings call, RediTrex is now covered by a growing number of managed care plans, including those associated with Cigna, Anthem, and United. Meanwhile, during the third quarter, we entered into an amendment to our agreement with Nordic Pharma, who previously provided us with the license for the U.S. rights for our RediTrex line. Based on the amendment, Nordic may assume responsibility for distributing the methotrexate products in the U.S. after March thirty-first of next year. Until then, we'll continue to commercialize and support RediTrex during a transition period.
Following in return of the license, Nordic will provide Cumberland a royalty on their future sales of the product through April 2035. Cumberland will transfer the marketing authorizations associated with the RediTrex line to Nordic, and in return, Nordic's returning 180,000 shares we issued to them associated with the original license, and they'll refund the $1 million we paid them following the Vibativ approval in the United States. Nordic's also issuing a credit note in favor of Cumberland in the amount of another $1 million for the unpaid milestone due from us, which was associated with our launch of the line. Together, the companies will continue to collaborate on any transition and ongoing commercialization of the product line.
Meanwhile, during the third quarter, we worked closely with the FDA-approved manufacturers that supply our products, monitoring our supply chain, including the raw materials as well as the finished goods emerging from those facilities. As previously reported, the packager for our Omeclamox-Pak brand has been unable to provide us with supplies of that product, having encountered difficulties and therefore suspending their operations during the pandemic. Their facility is now under new ownership and new management, and we're currently awaiting its availability in order to potentially engage in the packaging of new supplies for the product. Also, we're transitioning to a new manufacturer for our Vaprisol product. Last year, we shipped all remaining inventory of Vaprisol, and we notified the FDA that supplies of the product were no longer available at that time.
Since then, we've transferred the manufacturing to a new facility, and we do await FDA approval for that plant before resuming shipments of the brand. Our new manufacturing partner is working with the FDA to address several Form 483 and warning letter issues that they received in a timely manner. Meanwhile, we are working with them to support a special interim supply of compounded product for critically ill patients while we're awaiting the needed facility approval to relaunch Vaprisol. We support our portfolio of FDA-approved medicines through our three national sales divisions, including our newest, Cumberland Oncology. Our hospital division calls on key institutional accounts across the country, and our field sales division covers select office-based physicians.
With that overview, I'd now like to turn to John Hamm, Cumberland's Chief Financial Officer, to present a review of the third quarter financial results. John?
Thank you, A.J. For the three months ended September 30, 2022, net revenues from continuing operations were $11.4 million, a 41% increase over the $8.1 million in revenue recorded during the prior year period. Net revenues by product for the third quarter of 2022 included $4 million for Sancuso, $3.9 million for Kristalose, $1.9 million for Vibativ, and $0.9 million for Caldolor. It's important to note that given the quarterly fluctuations in buying patterns from our customers, we believe that our performance should be assessed based on annual sales results. Year-to-date, net revenues were $32.9 million, up 19% from the $27.7 million in revenue during the first nine months of 2021.
Year-to-date, product revenues total $11.4 million for Kristalose, $10.8 million for Sancuso, $6 million for Vibativ, and $3.1 million for Caldolor. Total operating expenses for the third quarter were $11.7 million compared to $9.6 million for the prior year period. The primary driver of this increase was the addition of Sancuso expenses, including those associated with the product's amortization, distribution, marketing, and selling. Year-to-date, expenses totaled $36.3 million compared to $31 million for the first nine months of 2021. Again, the new Sancuso expenses were the main contributor to this increase. The net loss for the quarter was $408,000. Year-to-date, we have a net loss of $3.1 million.
When non-cash expenses are added back, the resulting adjusted earnings for the third quarter were $1.4 million, a significant improvement of the adjusted loss of $327,000 last year. The year-to-date adjusted earnings were $1.7 million, also a significant increase over the $723,000 during the same period last year. Also, please note that those adjusted earnings do not include the additional benefit of the $1.4 million of Vibativ and Sancuso cost of goods during the quarter. Year-to-date, the benefit is $3.3 million. Those goods were received as part of each product's acquisition. Total cash flow from operations was $5.6 million, up 28% over the first nine months of 2021.
I'd like to remind you that our financial statements have been significantly impacted by the Vibativ and Sancuso acquisitions. The financial terms for the Vibativ transaction included a $20 million payment upon closing and a subsequent $5 million milestone payment. We also provide royalties based on product sales. I'm pleased to report that since Vibativ's launch in late 2018, it has delivered a total cash contribution of $30 million to our business and therefore has begun generating a return on our $25 million investment. We accounted for the Vibativ acquisitions as business combinations. A total of $34 million in new assets were added as a result of the acquisition, including approximately $21 million in inventory, $12 million of intangible assets, and $1 million of Goodwill.
Due to the amortization of intangibles and the sale of inventory, the value of these assets totaled $17 million at the end of the third quarter. Turning to the Sancuso acquisition, the financial terms included a $13.5 million payment upon closing, up to $3.5 million in milestone payments and tiered royalties on net product sales. Sancuso is off to a fine start, delivering $8 million in cash contribution during the first three quarters of 2022. As with Vibativ, we accounted for the Sancuso acquisition as a business combination. We are developing the final valuation of the Sancuso transaction, and on a preliminary basis, we estimate a total of $19 million in new assets added as a result of the acquisition, including approximately $5 million in inventory, $12 million of intangible assets, and $1 million of Goodwill.
The estimated value of these assets was $15 million at the end of the third quarter. Previously, we renewed our line of credit for a new three-year term. During the first quarter of 2022, we expanded our use of the facility to provide $20 million in capital. This new line of credit allowed us to acquire the U.S. rights to Sancuso. More recently, we amended the facility to increase our ability to fully utilize this line. Turning to our balance sheet as of September 30, 2022, we had $91.4 million in total assets, including $19.5 million in cash and cash equivalents. Liabilities totaled $52.9 million, including $17.7 million on our credit facility. Total shareholders' equity was $38 million at the end of the third quarter.
During the quarter, we continued our corporate share repurchase program and repurchased a total of 33,000 Cumberland shares. These repurchases included those on the open market, as well as those needed to fund the taxes associated with employee-vested restricted shares. Year to date, we have repurchased a total of 291,000 shares. A group of our board members also continued to purchase Cumberland shares through trading plans designed to increase their holdings in the company. So far in 2022, they have purchased a total of 28,000 shares. I'd also like to note that Cumberland continues to hold over $56 million in tax net operating loss carryforwards, primarily resulting from the prior exercise of stock options. That completes our financial report for the third quarter of 2022. Back to you, A.J.
Thank you, John. We're working to build an innovative pipeline of new product opportunities, and many of you who have been following us know we're sponsoring three phase II clinical programs featuring our ifetroban product candidate. These studies involve patients with aspirin-exacerbated respiratory disease, a severe form of asthma, systemic sclerosis, a debilitating autoimmune disorder, and Duchenne muscular dystrophy, a genetic Neuromuscular disease. This third program is being funded by a $1 million grant provided by the FDA's Office of Orphan Products Development. While patient enrollment in these studies slowed significantly last year during the height of the pandemic, this year enrollment has improved as medical centers reopened to clinical research and patients began returning for their treatment. Today, I'm announcing the closure to enrollment in our phase II AERD clinical study.
This randomized, placebo-controlled trial is designed to evaluate whether ifetroban can improve the symptoms in AERD patients without aspirin desensitization. A total of 56 patients were enrolled in 19 medical centers across the U.S. Top-line results will be announced upon completion of the study's data analysis. We're also working on an application to the FDA for a fourth phase II clinical program, which will evaluate the use of ifetroban to treat patients with progressive fibrosing interstitial lung diseases. In addition to our company-sponsored studies, there are also several investigator-initiated studies underway with ifetroban at various stages of completion. For these studies, Cumberland typically supplies ifetroban drug product as well as the placebo to the research groups involved.
Our plan going forward is to complete each of our company-sponsored studies, analyze the final data, announce top-line results, and then decide on the best development path for the registration of ifetroban, which we continue to believe has the potential to benefit many patients with orphan diseases that represent unmet medical needs. Next, I'd like to provide an overview of a few international activities underway, starting with Caldolor, our intravenously delivered formulation of ibuprofen. In October, we signed a new agreement with PiSA Farmacéutica for the exclusive supply and distribution of Caldolor in Mexico.
Under the terms of the agreement, Cumberland will be responsible for providing the product dossier and supplies, while PiSA will be responsible for securing regulatory approval and then commercializing the product in Mexico. PiSA has an established presence in Mexico with a strong distribution network that makes them a natural fit as a partner for that market. We believe Caldolor can serve as an important role in the careful management of pain there, and we're pleased to work with PiSA to establish the brand-new partnership. Turning to Vibativ, our injectable antibiotic. In March, we announced a new partnership with Saudi-based Tabuk Pharmaceutical to introduce Vibativ into the Middle East. The arrangement provides Tabuk with the exclusive rights to distribute Vibativ in Saudi Arabia and Jordan, plus an option to expand into other countries in the region.
Tabuk is a fully owned subsidiary of the Astra Industrial Group, a leading and publicly traded conglomerate based in Saudi Arabia. While Vibativ is now approved for sale in that country, we are in the process of adding new manufacturing information to the registration as we begin planning for the launch of the product there. Meanwhile, our partner in China, SciClone Pharmaceuticals, had their application for Vibativ in China accepted for review in 2021, last September. Since then, we've been supporting SciClone and their requests associated to the review of that submission. We look forward to the results and the potential launch of Vibativ into that important market.
While we may remain focused on promoting Caldolor and Vibativ here in the United States, we're excited to bring the product to patients in other countries through partnerships like those we formed and just described involving companies like PiSA, Tabuk, and SciClone. Overall, Cumberland has had another successful quarter, and we remain focused on our strategy of maximizing the potential of our commercial brands, progressing our pipeline, and continuing to pursue select new acquisitions. We're particularly encouraged by the arrival of Sancuso and its positive impact on our business. We're honored to deliver it to oncology patients across the country who need it, and believe that the contributions from the product are serving as a catalyst for the growth of our company.
Finally, I'm pleased to announce that as we announced last week, we've been able to move our new headquarter offices onto the Broadw est campus in the Vanderbilt West End corridor of Nashville, Tennessee. We're delighted to continue our presence and participation in the Nashville healthcare community, which represents the largest concentration of healthcare companies here in the country. This move allows us to accommodate our recent growth and it helps us to better serve our international base of customers and partners. In closing, I'd just like to say with new products to promote, an improved selling environment and a robust pipeline, we're very optimistic about our future, and we do expect a strong finish to 2022, enabling us to achieve our goal of double-digit revenue growth for the year.
I'm also confident that our well-located, state-of-the-art new headquarters will play an important role in the company's future success. Now with that review and update, let's open the call to any questions you may have. Operator, please proceed.
Thank you, sir. Ladies and gentlemen, that concludes the company's presentation. We will now open the call for any questions. If you'd like to ask a question, please press the star key on your phone, followed by the digit 1 twice. That's star one one . Please stand by.
Thanks everyone for joining today's call. We do understand that many of you prefer a private discussion with management. If so, please just reach out with us, and we'll be happy to hold such a call and get on schedule with you. As always, we appreciate your time and interest in Cumberland, and we look forward to providing another update after the end of the year.
Thank you, sir. Ladies and gentlemen, that concludes today's call. If you would like to listen to a replay of the discussion, please visit the investor relations section on Cumberland's website. I would like to thank you for your participation. You may now disconnect.