PURUM HEALTH PRODUCTS, a medical-device maker based in Sunnyvale, Calif., has surged since the start of the year, with revenues of more than $2 billion in the first nine months of 2017.
The company’s share price surged in recent weeks, with investors citing a surge in sales and an increase in the number of customers signing up for its online pharmacy-benefits programs.
The surge in revenue, however, was short-lived.
Purium, based in the U.S., lost a lot of its market share in the early part of the last decade and has been losing ground to a smaller but growing competitor.
The price of its products has fallen and it has had to adjust to its competitors’ prices, according to people familiar with the matter.
Purum’s shares have fallen more than 80% over the last three months, to $20.40 in late afternoon trading on Thursday, before bouncing back to $26.45 by noon on Friday.
A spokeswoman for Purum declined to comment.
Purum’s CEO, Dr. David R. Brown, said in a statement on Friday that the company has “been in an extremely challenging financial situation over the past two years,” as its revenue fell more than 90% in the past five years and the business’s revenue grew only 1% in 2017.
Puru-Pharma, a specialty pharmaceutical company based in Chicago, has seen its share price plunge nearly 80% in recent months, after the company was hit with an $8.5 billion takeover bid in July.
Dr. Brown said on Thursday that the takeover bid did not change the company’s business model.
He said in the statement that Purum was in “the midst of a significant turnaround program that includes a significant increase in revenues, which will allow us to continue to expand and diversify our portfolio.”
Puru Pharma’s CEO is now on a leave of absence after the acquisition bid.
At the same time, Purum has been ramping up the number and type of prescriptions it is writing.
In early March, it expanded its prescription drug benefit program to more than 5 million customers.
The plan now covers about one-fifth of the country’s population.
In addition, Puru’s medical-marijuana company is adding more than 2,000 new patients per month.
PURUM’s latest earnings report showed that the pharmacy-benefit company reported a net loss of $2.2 billion on $9.4 billion in revenue in the fourth quarter of 2017, and a net income loss of $(3.5) billion on $(11.1) billion in revenues in the second quarter of 2018.
Despite the tough environment, Purium has been expanding its prescription-drug programs and increasing sales.
Purubax has sold nearly $20 billion worth of the products in the last six months, including painkillers, cough syrup and oral medicines.
The company said in its earnings report that it had nearly 3,000 employees in all of 2017 and that it has nearly 6,000 physicians, nurses and other health care professionals.
On Thursday, Purubox also announced that it would spend more than half of its $7 billion buyout of its parent company, a large pharmacy chain in Canada, to expand its supply chain and bring back its own pharmacy-health programs, including its Health Plus program.
While Puruboom and Purubix have been making a strong push into the medical-tech space, many other drugmakers have also seen the health-care market decline, including Pfizer, Abbott Laboratories, Johnson & Johnson and Regeneron.