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8-K - FORM 8-K - BIOGEN INC. | b87395e8vk.htm |
Exhibit
99.1
Media Contact:
Christina Chan
Senior Manager, Public Affairs
Biogen Idec
Tel: (781) 464-3260
Christina Chan
Senior Manager, Public Affairs
Biogen Idec
Tel: (781) 464-3260
Investment Community Contact:
Kia Khaleghpour
Associate Director, Investor Relations
Biogen Idec
Tel: (781) 464-2442
Kia Khaleghpour
Associate Director, Investor Relations
Biogen Idec
Tel: (781) 464-2442
FOR IMMEDIATE RELEASE
Biogen Idec Reports Second Quarter 2011 Results
TYSABRIÒ Global In-Market Revenue Trending over $1.5 Billion Annualized Run Rate; Second
Quarter TYSABRI Revenues Increase 28%
TYSABRIÒ Global In-Market Revenue Trending over $1.5 Billion Annualized Run Rate; Second
Quarter TYSABRI Revenues Increase 28%
Weston, MA, July 26, 2011 Biogen Idec Inc. (NASDAQ: BIIB), a global biotechnology leader in the
discovery, development, manufacturing and commercialization of innovative therapies, today
announced its second quarter 2011 results.
Second Quarter 2011 Highlights:
| Second quarter revenues were $1.2 billion, flat compared to the second quarter of 2010. TYSABRI (natalizumab) revenues increased 28% year-over-year to $281 million while AVONEXÒ (interferon beta-1a) revenues increased 5% year-over-year to $659 million. RITUXANÒ (rituximab) revenues from our unconsolidated joint business arrangement were $216 million for the quarter, down 29% versus prior year. Our share of RITUXAN revenues from our unconsolidated joint business was reduced by approximately $50 million during the second quarter of 2011 as a result of an accrual relating to an intermediate decision in Genentech, Inc.s ongoing arbitration with Hoechst GmbH. | |
| Global in-market sales of TYSABRI in the second quarter of 2011 were $389 million, an increase of 31% over the second quarter of 2010. The total was comprised of $183 million in U.S. sales and $206 million in sales to markets outside the U.S. |
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| On a reported basis, calculated in accordance with accounting principles generally accepted in the U.S. (GAAP), second quarter 2011 GAAP diluted EPS were $1.18, an increase of 5% over the second quarter of 2010. GAAP net income attributable to Biogen Idec for the quarter was $288 million, a decrease of 2% from the second quarter of 2010. | |
| Non-GAAP diluted EPS for the second quarter of 2011 were $1.36, an increase of 4% over the second quarter of 2010. Non-GAAP net income attributable to Biogen Idec for the second quarter of 2011 was $332 million, a decrease of approximately 3% from the second quarter of 2010. A reconciliation of our GAAP to non-GAAP results is included on Table 3 within this press release. |
As of June 30, 2011, Biogen Idec had cash, cash equivalents and marketable securities of
approximately $2.5 billion.
We are pleased with our strong second quarter performance said George A. Scangos, Ph.D., chief
executive officer of Biogen Idec. Our commercial and financial performance has been strong, and
we have made great progress on our pipeline, which is now focused on high quality projects in areas
of our expertise neurology, immunology, and hemophilia. This quarter, we were excited by the
European Commissions approval of the inclusion of JCV antibody status as an additional PML risk
factor in TYSABRI labeling, as well as the conditional approval for FAMPYRA. We continue to focus
on execution to insure that we achieve our ambitious goals and continue our positive momentum into
the second half of this year.
Share Repurchases
During the second quarter of 2011, Biogen Idec repurchased 2.2 million shares of stock at a total
cost of $191 million.
TYSABRI Patient Growth
Based upon data available to us through the TOUCH® prescribing program and other
third-party sources, as of the end of June 2011, we estimate that approximately 61,500 patients
were on commercial and clinical TYSABRI therapy worldwide, and that cumulatively approximately
88,100 patients have ever been treated with TYSABRI in the post-marketing setting.
Other Products and Royalties
Revenues from other products in the second quarter of 2011 were $16 million, an increase of
36% over the second quarter of 2010.
Table 4 provides individual product revenues.
Royalties were $29 million in the second quarter of 2011, a decrease of 5% compared to the second
quarter of 2010.
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Corporate partner revenues in the second quarter of 2011 were $7 million, compared to $17 million
in the second quarter of 2010.
Revised Financial Guidance
Biogen Idec also revised its 2011 financial guidance. This guidance consists of the following
components:
| Revenue growth is expected to be in the low to mid-single digits versus 2010. | ||
| Cost of Sales is expected to be approximately 9% to 10% of total revenue. | ||
| R&D is expected to be approximately 22% to 24% of total revenue. | ||
| SG&A is expected to be approximately 20% to 21% of total revenue. | ||
| Tax rate is expected to be approximately 26% to 28% of pretax income. | ||
| GAAP diluted EPS is expected to be above $4.91. | ||
| Non-GAAP diluted EPS is expected to be above $5.70. | ||
| Capital expenditures are expected to be in the range of $200 to $220 million. |
Biogen Idec may incur charges, realize gains or experience other events in 2011 that could cause
actual results to vary from this guidance.
Recent Events
| On July 26, 2011, Biogen Idec and Swedish Orphan Biovitrum presented data on the long-lasting recombinant factor VIII therapy at the International Society on Thrombosis and Haemostasis meeting. Results showed the potential to significantly reduce the burden of treatment for people with Hemophilia A. | ||
| On July 20, 2011, Biogen Idec received conditional approval in the European Union for FAMPYRA® (prolonged-release fampridine tablets) to improve walking in adults with multiple sclerosis. The novel oral therapy provides clinically meaningful improvement in daily function. | ||
| On July 3, 2011, Biogen Idec researchers identified a novel approach for promoting remyelination and inhibiting autoimmune activation as a potential therapeutic option for the treatment of multiple sclerosis. | ||
| On June 23, 2011, Biogen Idec announced that its share of RITUXAN revenues from the unconsolidated joint business will be reduced by approximately $50 million during the second quarter of 2011 as a result of an accrual relating to an intermediate decision in Genentechs ongoing arbitration with Hoechst. | ||
| On June 22, 2011, the European Commission approved the inclusion of Anti-JC Virus Antibody Status as a PML risk factor in TYSABRI labeling. A five year marketing authorization for TYSABRI was also renewed in the EU. |
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| On June 7, 2011, Biogen Idec received approval in the European Union for AVONEX(R) PEN, the first single-use intramuscular autoinjector designed to improve convenience of once-weekly AVONEX administration. | ||
| On June 6, 2011, Biogen Idec announced positive data from the AVONEX Dose Titration Study at the 2011 Annual Meeting of the Consortium of Multiple Sclerosis Centers. The data showed that titrating AVONEX at the initiation of treatment reduced the severity of flu-like symptoms. | ||
| On May 20, 2011, the European Medicines Agencys (EMA) Committee for Medicinal Products for Human Use issued a positive opinion on the Marketing Authorisation Application for FAMPYRA. | ||
| On May 16, 2011, Biogen Idec received approval for FAMPYRA from The Australian Therapeutic Goods Administration to improve walking ability in adult patients with multiple sclerosis. | ||
| On May 9, 2011, Biogen Idec and Swedish Orphan Biovitrum received an opinion from the EMA agreeing to a pediatric investigational plan for the companies long-lasting Hemophilia B therapy. |
Conference Call and Webcast
The companys earnings conference call for the second quarter will be broadcast via the
internet at 8:30 a.m. ET on July 26, 2011, and will be accessible through the Investors section of
Biogen Idecs homepage, www.biogenidec.com. Supplemental information in the form of a slide
presentation will also be accessible at the same location on the internet at the time of the
earnings conference call and will be available there subsequently through August 26, 2011.
About Biogen Idec
Biogen Idec uses cutting-edge science to discover, develop, manufacture and market therapies
for the treatment of serious diseases with a focus on neurological disorders. Founded in 1978,
Biogen Idec is the worlds oldest independent biotechnology company. Patients worldwide benefit
from its leading multiple sclerosis therapies, and the company generates more than $4 billion in
annual revenues. For product labeling, press releases and additional information about the company,
please visit www.biogenidec.com.
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Safe Harbor
This press release contains forward-looking statements, including statements about the
anticipated development of programs in our clinical pipeline and financial guidance. These
forward-looking statements may be accompanied by such words as anticipate, believe, estimate,
expect, forecast, intend, may, plan, project, target, will and other words and
terms of similar meaning. You should not place undue reliance on these statements.
These statements involve risks and uncertainties that could cause actual results to differ
materially from those reflected in such statements, including our dependence on our three principal
products, AVONEX, RITUXAN and TYSABRI, the importance of TYSABRIs sales growth, product
competition, uncertainty of success in commercializing other products, the occurrence of adverse
safety events with our products, changes in the availability of reimbursement for our products,
adverse market and economic conditions, our dependence on collaborations and other third parties
over which we may not always have full control, failure to execute our growth initiatives, failure
to comply with government regulation and possible adverse impact of changes in such regulation,
charges and other costs relating to our properties, problems with our manufacturing processes and
our reliance on third parties, fluctuations in our effective tax rate, our
ability to attract and retain qualified personnel, the risks of doing business internationally, our
ability to protect our intellectual property rights and the cost of doing so, product liability
claims, fluctuations in our operating results, the market, interest and credit risks associated
with our portfolio of marketable securities, our level of indebtedness, environmental risks,
aspects of our corporate governance and collaborations, representation of activist shareholders on
our board of directors, and the other risks and
uncertainties that are described in the Risk Factors section of our most recent annual or quarterly
report and in other reports we have filed with the SEC.
These statements are based on our current beliefs and expectations and speak only as of the date of
this press release. We do not undertake any obligation to publicly update any forward-looking
statements.
###
TABLE 1
Biogen Idec Inc.
June 30, 2011
Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
Biogen Idec Inc.
June 30, 2011
Consolidated Statements of Income
(in thousands, except per share amounts)
(unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
REVENUES | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Product |
$ | 956,703 | $ | 859,235 | $ | 1,863,805 | $ | 1,683,455 | ||||||||
Unconsolidated joint business |
216,458 | 306,371 | 472,583 | 561,300 | ||||||||||||
Royalties |
28,649 | 30,098 | 54,227 | 56,120 | ||||||||||||
Corporate partner |
6,837 | 16,998 | 21,375 | 20,687 | ||||||||||||
Total revenues |
1,208,647 | 1,212,702 | 2,411,990 | 2,321,562 | ||||||||||||
COST AND EXPENSES |
||||||||||||||||
Cost of sales, excluding amortization of acquired intangible assets |
100,503 | 106,985 | 203,616 | 204,040 | ||||||||||||
Research and development |
285,644 | 331,675 | 579,277 | 638,705 | ||||||||||||
Selling, general and administrative |
266,301 | 262,322 | 510,819 | 510,987 | ||||||||||||
Collaboration profit sharing |
88,050 | 62,692 | 162,844 | 126,249 | ||||||||||||
Amortization of acquired intangible assets |
55,136 | 53,148 | 108,352 | 102,037 | ||||||||||||
Restructuring charges |
| | 16,587 | | ||||||||||||
Fair value adjustment of contingent consideration |
2,200 | | 3,400 | | ||||||||||||
Acquired in-process research and development |
| | | 39,976 | ||||||||||||
Total cost and expenses |
797,834 | 816,822 | 1,584,895 | 1,621,994 | ||||||||||||
Income from operations |
410,813 | 395,880 | 827,095 | 699,568 | ||||||||||||
Other income (expense), net |
(11,728 | ) | 1,012 | (1,777 | ) | (7,373 | ) | |||||||||
INCOME BEFORE INCOME TAX EXPENSE |
399,085 | 396,892 | 825,318 | 692,195 | ||||||||||||
Income tax expense |
95,036 | 102,243 | 212,504 | 177,553 | ||||||||||||
NET INCOME |
$ | 304,049 | $ | 294,649 | $ | 612,814 | $ | 514,642 | ||||||||
Net income attributable to noncontrolling interest, net of tax |
16,015 | 1,211 | 30,450 | 3,762 | ||||||||||||
NET INCOME ATTRIBUTABLE TO BIOGEN IDEC INC. |
$ | 288,034 | $ | 293,438 | $ | 582,364 | $ | 510,880 | ||||||||
BASIC EARNINGS PER SHARE |
$ | 1.19 | $ | 1.13 | $ | 2.40 | $ | 1.92 | ||||||||
DILUTED EARNINGS PER SHARE |
$ | 1.18 | $ | 1.12 | $ | 2.38 | $ | 1.91 | ||||||||
WEIGHTED-AVERAGE SHARES USED IN CALCULATING: |
||||||||||||||||
BASIC EARNINGS PER SHARE |
242,375 | 259,938 | 241,932 | 265,018 | ||||||||||||
DILUTED EARNINGS PER SHARE |
244,966 | 261,658 | 244,899 | 267,272 | ||||||||||||
TABLE 2
Biogen Idec Inc.
June 30, 2011
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
Biogen Idec Inc.
June 30, 2011
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
June 30, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS | ||||||||
Cash, cash equivalents and marketable securities |
$ | 1,326,744 | $ | 1,207,744 | ||||
Accounts receivable, net |
666,960 | 605,329 | ||||||
Inventory |
308,254 | 289,066 | ||||||
Other current assets |
386,665 | 438,281 | ||||||
Total current assets |
2,688,623 | 2,540,420 | ||||||
Marketable securities |
1,183,559 | 743,101 | ||||||
Property, plant and equipment, net |
1,712,869 | 1,641,634 | ||||||
Intangible assets, net |
1,678,867 | 1,772,826 | ||||||
Goodwill |
1,146,314 | 1,146,314 | ||||||
Investments and other assets |
211,747 | 248,198 | ||||||
TOTAL ASSETS |
$ | 8,621,979 | $ | 8,092,493 | ||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
Current portion of notes payable and other
financing arrangements |
$ | 131,981 | $ | 137,153 | ||||
Other current liabilities |
822,349 | 912,969 | ||||||
Long-term deferred tax liability |
196,784 | 200,950 | ||||||
Notes payable and line of credit |
1,062,986 | 1,066,379 | ||||||
Other long-term liabilities |
351,685 | 325,599 | ||||||
Shareholders equity |
6,056,194 | 5,449,443 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY |
$ | 8,621,979 | $ | 8,092,493 | ||||
TABLE 3
Biogen Idec Inc.
June 30, 2011
Condensed Consolidated Statements of Income NonGAAP
(in millions, except per share amounts)
(unaudited)
Biogen Idec Inc.
June 30, 2011
Condensed Consolidated Statements of Income NonGAAP
(in millions, except per share amounts)
(unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
EARNINGS PER SHARE | 2011 | 2010 | 2011 | 2010 | ||||||||||||
GAAP earnings per share Diluted |
$ | 1.18 | $ | 1.12 | $ | 2.38 | $ | 1.91 | ||||||||
Adjustments to net income attributable to Biogen Idec Inc. (as detailed below) |
0.18 | 0.19 | 0.40 | 0.48 | ||||||||||||
Non-GAAP earnings per share Diluted |
$ | 1.36 | $ | 1.31 | $ | 2.78 | $ | 2.39 | ||||||||
An itemized reconciliation between net income attributable to Biogen Idec Inc. on a GAAP basis and net income attributable to Biogen Idec Inc. on a non-GAAP basis is as follows: | ||||||||||||||||
GAAP net income attributable to Biogen Idec Inc. |
$ | 288.0 | $ | 293.4 | $ | 582.4 | $ | 510.9 | ||||||||
Adjustments: |
||||||||||||||||
R&D: Restructuring and severance |
| 0.6 | | 1.3 | ||||||||||||
R&D: Stock option expense |
0.5 | 0.8 | 1.7 | 2.4 | ||||||||||||
R&D: Expenses paid by Cardiokine |
| 1.9 | | 3.8 | ||||||||||||
SG&A: Restructuring and severance |
| 1.5 | | 5.8 | ||||||||||||
SG&A: Stock option expense |
1.2 | 8.8 | 2.5 | 19.5 | ||||||||||||
Amortization of acquired intangible assets |
55.1 | 53.2 | 108.4 | 102.0 | ||||||||||||
Restructuring charges |
| | 16.6 | | ||||||||||||
Fair value adjustment of contingent consideration associated with the 2010 Panima
acquisition |
2.2 | | 3.4 | | ||||||||||||
Acquired in-process research and development related to the contingent consideration
payment associated with the 2007 Syntonix acquisition |
| | | 40.0 | ||||||||||||
Income tax expense: Income tax effect
related to reconciling items |
(14.8 | ) | (15.1 | ) | (33.5 | ) | (42.3 | ) | ||||||||
Noncontrolling interest: Expenses paid by Cardiokine |
| (1.9 | ) | | (3.8 | ) | ||||||||||
Non-GAAP net income attributable to Biogen Idec Inc. |
$ | 332.2 | $ | 343.2 | $ | 681.5 | $ | 639.6 | ||||||||
2011 Full Year Guidance GAAP to non-GAAP adjustments
An itemized reconciliation between projected EPS on a GAAP basis and on a non-GAAP basis is as follows:
$ Millions | Shares | Diluted EPS | ||||||||||
Projected GAAP net income attributable to Biogen Idec Inc. |
$ | 1,203.0 | 245 | $ | 4.91 | |||||||
Adjustments: |
||||||||||||
Stock option expense |
12.4 | |||||||||||
Amortization of acquired intangible assets |
220.7 | |||||||||||
Restructuring charges |
23.1 | |||||||||||
Contingent consideration |
5.5 | |||||||||||
Income taxes |
(68.2 | ) | ||||||||||
Projected Non-GAAP net income attributable to Biogen Idec Inc. |
$ | 1,396.5 | 245 | $ | 5.70 | |||||||
Use of Non-GAAP Financial Measures
Our non-GAAP net income attributable to Biogen Idec Inc. and non-GAAP diluted EPS financial
measures exclude the following items from GAAP net income attributable to Biogen Idec Inc. and
diluted EPS:
1. Purchase accounting and merger-related adjustments.
We exclude certain purchase accounting impacts, such as those related to the 2003 merger between
Biogen, Inc. and Idec Pharmaceuticals, Inc., the acquisitions of Fumapharm AG, Conforma
Therapeutics, Syntonix Pharmaceuticals, and Panima Pharmaceuticals AG and the consolidation of
Knopp and Cardiokine. These include charges for in-process research and development and
amortization of the acquired intangible assets. Excluding these charges provides management and
investors with a supplemental measure of performance in which the Companys acquired intellectual
property is treated in a comparable manner to its internally developed intellectual property.
2. Stock option expense recorded in accordance with the accounting standard for share-based
payments.
We believe that excluding the impact of expensing stock options better reflects the recurring
economic characteristics of our business. We exclude stock option expense from our non-GAAP R&D
expenses and SG&A expenses, but include the impact of all other share-based awards and cash
incentives in our non-GAAP results.
3. Other items.
We evaluate these on an individual basis, and consider both the quantitative and qualitative
aspects of the item, including (i) its size and nature, (ii) whether or not it relates to our
ongoing business operations, and (iii) whether or not we expect it to occur as part of our normal
business on a regular basis.
We believe it is important to share these non-GAAP financial measures with shareholders as they
better represent the ongoing economics of the business, reflect how we manage the business
internally and set operational goals, and form the basis of our management incentive programs.
Non-GAAP net income attributable to Biogen Idec Inc. and diluted EPS should not be viewed in
isolation or as a substitute for reported, or GAAP, net income attributable to Biogen Idec Inc. and
diluted EPS.
TABLE 4
Biogen Idec Inc.
June 30, 2011
Product Revenues
(in thousands)
(unaudited)
Biogen Idec Inc.
June 30, 2011
Product Revenues
(in thousands)
(unaudited)
Three Months Ended | ||||||||
June 30, | ||||||||
2011 | 2010 | |||||||
PRODUCT REVENUES |
||||||||
Avonex® |
$ | 659,233 | $ | 628,134 | ||||
Tysabri® |
281,383 | 219,238 | ||||||
Fumaderm® |
15,064 | 11,841 | ||||||
Other |
1,023 | 22 | ||||||
Total product revenues |
$ | 956,703 | $ | 859,235 | ||||
Six Months Ended | ||||||||
June 30, | ||||||||
2011 | 2010 | |||||||
PRODUCT REVENUES |
||||||||
Avonex® |
$ | 1,301,711 | $ | 1,220,661 | ||||
Tysabri® |
532,776 | 437,882 | ||||||
Fumaderm® |
27,570 | 24,890 | ||||||
Other |
1,748 | 22 | ||||||
Total product revenues |
$ | 1,863,805 | $ | 1,683,455 | ||||