— Second Quarter Revenues of
— Alkermes Unveils ARISTADA™ as Proposed Brand Name for Aripiprazole
Lauroxil;
Final Launch Preparations Underway in Advance of
— Company Improves Financial Expectations for 2015 Driven by Strong VIVITROL® Performance —
“With the PDUFA date for ARISTADA™, our proposed brand name for
aripiprazole lauroxil, just a few weeks away, we are in the midst of
final launch preparations for this important potential new treatment
option for patients with schizophrenia. Our field sales force is in
position, our comprehensive patient support services are ready and
launch quantities have been manufactured,” said Richard Pops, Chief
Executive Officer of
“Our second quarter financial results were driven by the strong revenues
from our core portfolio of commercial products, important investments in
the development of our late-stage CNS pipeline and the launch
preparations for ARISTADA,” commented
Quarter Ended
-
Total revenues for the quarter were
$151.4 million compared to$153.4 million for the same period in the prior year. The prior year period included$21.1 million of revenues from the products associated with theGainesville manufacturing facility that was divested inApril 2015 . -
Net loss according to generally accepted accounting principles in the
U.S. (GAAP) was
$46.1 million , or a basic and diluted GAAP loss per share of$0.31 , for the quarter. This compared to GAAP net income of$3.7 million , or a basic GAAP earnings per share (EPS) of$0.03 and a diluted GAAP EPS of$0.02 , for the same period in the prior year, which included GAAP net income of$7.3 million related to theGainesville facility and associated products and$27.6 million of net income from two one-time transactions. -
Non-GAAP net loss was
$13.6 million , or a non-GAAP diluted loss per share of$0.09 for the quarter. This compared to non-GAAP net income of$17.7 million , or a non-GAAP diluted EPS of$0.11 , for the same period in the prior year, which included non-GAAP net income of$10.6 million related to theGainesville facility and associated products. -
On
April 10, 2015 ,Alkermes closed the transaction to divest itsGainesville, Ga. facility and associated products, as well as rights to IV/IM and parenteral forms of Meloxicam (Meloxicam), toRecro Pharma, Inc. (Recro) in exchange for gross proceeds of$54 million and future payments related to Meloxicam, including milestone payments of up to$120 million and low double-digit royalties on net sales.Alkermes recorded a gain on this transaction of$9.9 million during the second quarter, which was recorded as a component of other income, net.
Quarter Ended
Revenues
-
Manufacturing and royalty revenues from the company’s long-acting
atypical antipsychotic franchise, RISPERDAL® CONSTA®
and INVEGA® SUSTENNA®/XEPLION®,were
$60.8 million , compared to$60.0 million for the same period in the prior year. -
Manufacturing and royalty revenues from AMPYRA®/FAMPYRA®1
were
$26.9 million , compared to$19.5 million for the same period in the prior year. -
Net sales of VIVITROL were
$37.2 million , compared to$21.6 million for the same period in the prior year, representing an increase of approximately 72%. -
Royalty revenue from BYDUREON® was
$11.1 million , compared to$8.8 million for the same period in the prior year.
Costs and Expenses
-
Operating expenses were
$203.9 million , reflecting increased investment in the company’s rapidly advancing central nervous system (CNS) development pipeline and pre-launch activities for ARISTADA. This compared to$176.2 million for the same period in the prior year, which included$13.2 million related to theGainesville facility and associated products. -
Income tax provision was
$3.1 million , compared to an income tax benefit of$1.5 million for the same period in the prior year.
Balance Sheet
At
Financial Expectations
-
Revenues:
Alkermes now expects total revenues to range from$610 million to $640 million , up from the previous range of$600 million to $630 million .-
Alkermes now expects VIVITROL net sales to range from$135 million to$145 million , up from a previous range of$125 million to $135 million . -
The company continues to expect net sales from the anticipated
launch of ARISTADA to range from
$5 million to $10 million .
-
-
Cost of Goods Manufactured and Sold: The company continues to
expect cost of goods manufactured and sold to range from
$130 million to$140 million . -
R&D Expenses: The company continues to expect R&D expenses
to range from
$345 million to $365 million . -
Selling, General and Administrative (SG&A) Expenses: The
company continues to expect SG&A expenses to range from
$310 million to$330 million . -
Amortization of Intangible Assets: The company now expects
amortization of intangible assets of approximately
$60 million , reduced from the previous expectation of approximately$65 million . -
Net Interest Expense: The company continues to expect net
interest expense to range from
$10 million to $15 million . -
Other Income, Net: The company now expects other income, net to
range from
$10 million to $15 million , driven primarily by the gain on the sale of theGainesville facility and associated products during the second quarter and changes in the fair value of the contingent consideration and warrants received as part of the transaction. -
Net Income Tax Expense: The company continues to expect net
income tax expense to range from
$10 million to $15 million . -
GAAP Net Loss: The company now expects GAAP net loss to range
from
$245 million to $270 million , or a basic and diluted loss per share of$1.63 to $1.80 , based on weighted average basic and diluted share counts of approximately 150 million shares outstanding. This compares to previous expectations of GAAP net loss in the range of$270 million to $300 million , or a basic and diluted loss per share of approximately$1.80 to $2.00 , based on weighted average basic and diluted share counts of approximately 150 million shares outstanding. -
Non-GAAP Net Loss: The company now expects non-GAAP net loss to
range from
$47 million to $67 million , or a basic and diluted loss per share of$0.31 to $0.45 , based on weighted average basic and diluted share counts of approximately 150 million shares outstanding. This compares to previous expectations of non-GAAP net loss in the range of$55 million to $75 million , or a non-GAAP diluted loss per share of$0.37 to $0.50 , based on a weighted average diluted share count of approximately 150 million shares outstanding. -
Capital Expenditures: The company continues to expect capital
expenditures to be approximately
$50 million . -
Free Cash Outflow: The company now expects free cash outflow to
range from
$97 million to $117 million . This compares to previous expectations of free cash outflow in the range of$105 million to $125 million .
Conference Call
About Alkermes
Non-GAAP Financial Measures
This press release includes information about certain financial measures that are not prepared in accordance with generally accepted accounting principles in the U.S. (GAAP), including non-GAAP net income or loss, non-GAAP diluted earnings or loss per share and free cash flow. These non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies.
Management defines its non-GAAP financial measures as follows:
- Non-GAAP net income or loss adjusts for one-time and non-cash charges by excluding from GAAP results: share-based compensation expense; amortization; depreciation; non-cash net interest expense; non-cash tax expense; deferred revenue; and certain other one-time or non-cash items.
- Free cash flow represents non-GAAP net income or loss less capital expenditures.
The company’s management believes that these non-GAAP financial measures, when viewed with the company’s results under GAAP and the accompanying reconciliations, better indicate underlying trends in ongoing operations and cash flows. However, non-GAAP net income or loss, non-GAAP diluted earnings or loss per share and free cash flow are not measures of financial performance under GAAP and, accordingly, should not be considered as alternatives to GAAP measures as indicators of operating performance.
A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release.
Note Regarding Forward-Looking Statements
Certain statements set forth above may constitute “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995, as amended, including, but not limited to:
statements concerning future financial and operating performance,
business plans or prospects; the likelihood of continued revenue growth
from the company’s commercial products; the therapeutic and commercial
value of the company’s products; and expectations concerning the timing
and results of development activities, including regulatory approval of
ARISTADA (aripiprazole lauroxil) and advancement of the company’s
product candidates. The company cautions that forward-looking statements
are inherently uncertain. Although the company believes that such
statements are based on reasonable assumptions within the bounds of its
knowledge of its business and operations, the forward-looking statements
are neither promises nor guarantees and they are necessarily subject to
a high degree of uncertainty and risk. Actual performance and results
may differ materially from those expressed or implied in the
forward-looking statements due to various risks and uncertainties. These
risks and uncertainties include, among others: clinical development
activities may not be completed on time or at all and the results of
such activities may not be predictive of real-world results or of
results in subsequent clinical trials; regulatory submissions may not
occur or be submitted in a timely manner; the company, and its partners,
may not be able to continue to successfully commercialize its products;
there may be a reduction in payment rate or reimbursement for the
company’s products or an increase in the company’s financial obligations
to governmental payers; the
ARISTADA™ is a trademark of
1AMPYRA® (dalfampridine) Extended Release Tablets,
10 mg is developed and marketed in the U.S. by
Alkermes plc and Subsidiaries |
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Three Months |
Three Months | ||||||||
Ended | Ended | ||||||||
Condensed Consolidated Statements of Operations - GAAP | June 30, | June 30, | |||||||
(In thousands, except per share data) | 2015 | 2014 | |||||||
Revenues: | |||||||||
Manufacturing and royalty revenues | $ 113,162 | $ 130,366 | |||||||
Product sales, net | 37,172 | 21,595 | |||||||
Research and development revenues | 1,036 | 1,463 | |||||||
Total Revenues | 151,370 | 153,424 | |||||||
Expenses: | |||||||||
Cost of goods manufactured and sold | 30,418 | 43,290 | |||||||
Research and development | 87,882 | 67,207 | |||||||
Selling, general and administrative | 71,539 | 50,663 | |||||||
Amortization of acquired intangible assets | 14,052 | 15,089 | |||||||
Total Expenses | 203,891 | 176,249 | |||||||
Operating Loss | (52,521 | ) | (22,825 | ) | |||||
Other Income, net: | |||||||||
Interest income | 795 | 323 | |||||||
Interest expense | (3,315 | ) | (3,385 | ) | |||||
Gain on Gainesville Transaction | 9,911 | - | |||||||
Increase in the fair value of contingent consideration | 1,500 | - | |||||||
Gain on sale of property, plant and equipment | - | 12,285 | |||||||
Other income, net | 585 | 518 | |||||||
Gain on sale of investment in Acceleron Pharma Inc. | - | 15,296 | |||||||
Total Other Income, net | 9,476 | 25,037 | |||||||
(Loss) Income Before Income Taxes | (43,045 | ) | 2,212 | ||||||
Income Tax Provision (Benefit) | 3,064 | (1,523 | ) | ||||||
Net (Loss) Income — GAAP | $ (46,109 | ) | $ 3,735 | ||||||
(Loss) Earnings Per Share: | |||||||||
GAAP (loss) earnings per share — basic | $ (0.31 | ) | $ 0.03 | ||||||
GAAP (loss) earnings per share — diluted | $ (0.31 | ) | $ 0.02 | ||||||
Non-GAAP (loss) earnings per share — basic | $ (0.09 | ) | $ 0.12 | ||||||
Non-GAAP (loss) earnings per share — diluted | $ (0.09 | ) | $ 0.11 | ||||||
Weighted Average Number of Ordinary Shares Outstanding: | |||||||||
Basic — GAAP | 148,867 | 144,913 | |||||||
Diluted — GAAP | 148,867 | 154,300 | |||||||
Basic — Non-GAAP | 148,867 | 144,140 | |||||||
Diluted — Non-GAAP | 148,867 | 153,833 | |||||||
An itemized reconciliation between net (loss) income on a GAAP basis and non-GAAP net (loss) income is as follows: | |||||||||
Net (Loss) Income — GAAP | $ (46,109 | ) | $ 3,735 | ||||||
Adjustments: | |||||||||
Share-based compensation expense | 21,877 | 19,337 | |||||||
Amortization expense | 14,052 | 15,089 | |||||||
Depreciation expense | 6,584 | 9,844 | |||||||
Non-cash net interest expense | 235 | 239 | |||||||
Non-cash taxes | 3,034 | (2,207 | ) | ||||||
Deferred revenue | (574 | ) | (338 | ) | |||||
Net loss on transactions with equity method investee | (397 | ) | (396 | ) | |||||
Gain on Gainesville Transaction | (9,911 | ) | - | ||||||
Increase in the fair value of contingent consideration | (1,500 | ) | - | ||||||
Change in the fair value of common stock warrants | (876 | ) | - | ||||||
Gain on sale of investment in Acceleron Pharma Inc. | - | (15,296 | ) | ||||||
Gain on sale of property, plant and equipment | - | (12,285 | ) | ||||||
Non-GAAP Net (Loss) Income | $ (13,585 | ) | $ 17,722 | ||||||
Capital expenditures | 14,046 | 5,753 | |||||||
Free Cash (Outflow) Inflow | $ (27,631 | ) | $ 11,969 |
Six Months |
Six Months | ||||||||
Ended | Ended | ||||||||
Condensed Consolidated Statements of Operations - GAAP | June 30, | June 30, | |||||||
(In thousands, except per share data) | 2015 | 2014 | |||||||
Revenues: | |||||||||
Manufacturing and royalty revenues | $ 241,906 | $ 241,646 | |||||||
Product sales, net | 68,309 | 38,674 | |||||||
Research and development revenues | 2,369 | 3,316 | |||||||
Total Revenues | 312,584 | 283,636 | |||||||
Expenses: | |||||||||
Cost of goods manufactured and sold | 70,392 | 82,129 | |||||||
Research and development | 158,160 | 119,347 | |||||||
Selling, general and administrative | 134,589 | 93,213 | |||||||
Amortization of acquired intangible assets | 29,272 | 27,665 | |||||||
Total Expenses | 392,413 | 322,354 | |||||||
Operating Loss | (79,829 | ) | (38,718 | ) | |||||
Other Income, net: | |||||||||
Interest income | 1,455 | 834 | |||||||
Interest expense | (6,603 | ) | (6,741 | ) | |||||
Gain on Gainesville Transaction | 9,911 | - | |||||||
Increase in the fair value of contingent consideration | 1,500 | - | |||||||
Gain on sale of property, plant and equipment | - | 12,285 | |||||||
Other income (expense), net | 374 | (1,332 | ) | ||||||
Gain on sale of investment in Acceleron Pharma Inc. | - | 15,296 | |||||||
Total Other Income, net | 6,637 | 20,342 | |||||||
Loss Before Income Taxes | (73,192 | ) | (18,376 | ) | |||||
Income Tax Provision | 3,574 | 2,243 | |||||||
Net Loss — GAAP | $ (76,766 | ) | $ (20,619 | ) | |||||
(Loss) Earnings Per Share: | |||||||||
GAAP loss per share — basic | $ (0.52 | ) | $ (0.14 | ) | |||||
GAAP loss per share — diluted | $ (0.52 | ) | $ (0.14 | ) | |||||
Non-GAAP (loss) earnings per share — basic | $ (0.03 | ) | $ 0.24 | ||||||
Non-GAAP (loss) earnings per share — diluted | $ (0.03 | ) | $ 0.22 | ||||||
Weighted Average Number of Ordinary Shares Outstanding: | |||||||||
Basic — GAAP | 148,480 | 144,140 | |||||||
Diluted — GAAP | 148,480 | 144,140 | |||||||
Basic — Non-GAAP | 148,480 | 144,140 | |||||||
Diluted — Non-GAAP | 148,480 | 153,833 | |||||||
An itemized reconciliation between net loss on a GAAP basis and non-GAAP net (loss) income is as follows: | |||||||||
Net Loss — GAAP | $ (76,766 | ) | $ (20,619 | ) | |||||
Adjustments: | |||||||||
Share-based compensation expense | 39,206 | 32,757 | |||||||
Amortization expense | 29,272 | 27,665 | |||||||
Depreciation expense | 13,850 | 19,821 | |||||||
Non-cash net interest expense | 471 | 479 | |||||||
Non-cash taxes | 3,522 | 1,415 | |||||||
Deferred revenue | (902 | ) | (1,303 | ) | |||||
Net loss on transactions with equity method investee | (794 | ) | 1,239 | ||||||
Gain on Gainesville Transaction | (9,911 | ) | - | ||||||
Increase in the fair value of contingent consideration | (1,500 | ) | - | ||||||
Change in the fair value of common stock warrants | (876 | ) | - | ||||||
Gain on sale of investment in Acceleron Pharma Inc. | - | (15,296 | ) | ||||||
Gain on sale of property, plant and equipment | - | (12,285 | ) | ||||||
Non-GAAP Net (Loss) Income | $ (4,428 | ) | $ 33,873 | ||||||
Capital expenditures | 24,756 | 11,438 | |||||||
Free Cash (Outflow) Inflow | $ (29,184 | ) | $ 22,435 | ||||||
Condensed Consolidated Balance Sheets | June 30, | December 31, | |||||
(In thousands) | 2015 | 2014 | |||||
Cash, cash equivalents and total investments | $ 832,358 | $ 801,646 | |||||
Receivables | 135,783 | 151,551 | |||||
Inventory | 38,801 | 51,357 | |||||
Prepaid expenses and other current assets | 65,279 | 42,719 | |||||
Property, plant and equipment, net | 239,258 | 265,740 | |||||
Intangible assets, net and goodwill | 500,472 | 573,624 | |||||
Contingent consideration | 59,100 | - | |||||
Other assets | 43,460 | 34,635 | |||||
Total Assets | $ 1,914,511 | $ 1,921,272 | |||||
Long-term debt — current portion | $ 6,750 | $ 6,750 | |||||
Other current liabilities | 127,468 | 123,832 | |||||
Long-term debt | 348,056 | 351,220 | |||||
Deferred revenue — long-term | 7,805 | 11,801 | |||||
Other long-term liabilities | 25,441 | 30,832 | |||||
Total shareholders' equity | 1,398,991 | 1,396,837 | |||||
Total Liabilities and Shareholders' Equity | $ 1,914,511 | $ 1,921,272 | |||||
Ordinary shares outstanding (in thousands) | 149,304 | 147,539 | |||||
This selected financial information should be read in conjunction with the consolidated financial statements and notes thereto included in Alkermes plc's Quarterly Report on Form 10-Q for the three and six months ended June 30, 2015, which the company intends to file in July 2015. | |||||||
Alkermes plc and Subsidiaries |
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An itemized reconciliation between projected loss per share on a GAAP basis and projected loss per share on a non-GAAP basis is as follows: | ||||||||||||
(In millions, except per share data) | Amount | Shares | Loss Per Share | |||||||||
Projected Net Loss — GAAP | $ (257.5 | ) | 150 | $ (1.72 | ) | |||||||
Adjustments: | ||||||||||||
Non-cash net interest expense | 1.0 | |||||||||||
Non-cash taxes | 10.0 | |||||||||||
Depreciation expense | 35.0 | |||||||||||
Amortization expense | 60.0 | |||||||||||
Share-based compensation expense | 110.0 | |||||||||||
Gain on Gainesville Transaction | (10.0 | ) | ||||||||||
Change in fair value of contingent consideration and warrants | (2.5 | ) | ||||||||||
Deferred revenue | (3.0 | ) | ||||||||||
Projected Non-GAAP Net Loss | $ (57.0 | ) | 150 | $ (0.38 | ) | |||||||
Capital expenditures | 50.0 | |||||||||||
Projected Free Cash Outflow | $ (107.0 | ) | ||||||||||
Projected GAAP and non-GAAP measures reflect mid-points within ranges of estimated guidance. |
View source version on businesswire.com: http://www.businesswire.com/news/home/20150730005222/en/
Source:
Alkermes Contacts:
For Investors:
Rebecca
Peterson, +1-781-609-6378
or
For Media:
Jennifer Snyder,
+1-781-609-6166