—First Quarter Revenues of $157 Million, GAAP
Loss per Share of $0.51 and Non-GAAP Loss per Share of $0.16 —
—VIVITROL® Net Sales Grew by 41% Year-Over-Year
to $43.8 Million —
—ARISTADA® Gaining Traction in Growing
Long-Acting Antipsychotic Market —
Alkermes plc (NASDAQ: ALKS) today reported financial results for
the first quarter of 2016.
“Our solid first quarter performance was highlighted by the
robust growth in VIVITROL® sales, the launch of ARISTADA®, and
continued strength of our base royalty and manufacturing business.
The launch of ARISTADA continues to gain traction, and we are
pleased with the progress that we are making with reimbursement
discussions and physician awareness,” commented James Frates, Chief
Financial Officer of Alkermes. “With our strong financial position
and growing commercial portfolio, we are well positioned to invest
in our advancing pipeline, and today we are reiterating our
financial expectations for 2016.”
“We have built a differentiated and resilient business. Our
portfolio of innovative products, including VIVITROL and ARISTADA,
is growing rapidly and represents a significant opportunity in the
years ahead,” said Richard Pops, Chief Executive Officer of
Alkermes. “Our pipeline has a number of exciting late-stage
programs, and we are on the threshold of numerous development
milestones. With three drug candidates in pivotal studies, each
representing an important and differentiated treatment option in
its therapeutic space, and two new candidates beginning clinical
studies, the medical importance and potential economic value of our
pipeline is substantial and growing.”
Quarter Ended March 31, 2016
Highlights
- Total revenues for the quarter were
$156.8 million. This compared to $161.2 million for the same period
in the prior year, or $142.0 million excluding $19.2 million of
revenue from the products associated with the Gainesville
manufacturing facility that was divested in April 2015 (the
“Gainesville Divestiture”).
- Net loss according to generally
accepted accounting principles in the U.S. (GAAP) was $77.4
million, or a basic and diluted GAAP loss per share of $0.51, for
the quarter and reflected increased investment in the company’s
advancing late-stage pipeline and commercial infrastructure. This
compared to GAAP net loss of $30.7 million, or a basic and diluted
GAAP loss per share of $0.21 for the same period in the prior year,
or GAAP net loss of $34.9 million, or a basic and diluted loss per
share of $0.24, excluding $4.2 million of GAAP net income related
to the Gainesville Divestiture.
- Non-GAAP net loss was $24.6 million, or
a non-GAAP basic and diluted loss per share of $0.16 for the
quarter. This compared to non-GAAP net income of $9.2 million, or a
non-GAAP diluted earnings per share (EPS) of $0.06, for the same
period in the prior year, or non-GAAP net income of $1.9 million,
or basic and diluted EPS of $0.01, excluding $7.3 million of
non-GAAP net income related to the Gainesville Divestiture.
Quarter Ended March 31, 2016 Financial
Results
Revenues
- Net sales of VIVITROL were $43.8
million, compared to $31.1 million for the same period in the prior
year, representing an increase of approximately 41%.
- Net sales of ARISTADA were $5.5
million, following its launch in October 2015.
- Manufacturing and royalty revenues from
RISPERDAL CONSTA® and INVEGA SUSTENNA®/XEPLION® and INVEGA TRINZA®
were $54.7 million, compared to $46.9 million for the same period
in the prior year.
- Manufacturing and royalty revenues from
AMPYRA®/FAMPYRA®1 were $28.2 million, compared to $36.5 million for
the same period in the prior year, reflecting the timing of
shipments.
- Royalty revenue from BYDUREON® was
$10.5 million, compared to $9.8 million for the same period in the
prior year.
Costs and Expenses
- Operating expenses were $233.7 million,
reflecting increased investment in the company’s development
pipeline, the continued launch of ARISTADA and a $10.0 million
upfront payment to Reset Therapeutics, Inc. related to a
collaboration on their novel orexin modulators, which was recorded
as research and development expense. Operating expenses for the
quarter ended March 31, 2015 were $188.5 million, or $173.5 million
excluding $15.0 million of operating expenses related to the
Gainesville Divestiture.
Balance Sheet
At March 31, 2016, Alkermes had cash and total investments of
$719.4 million, compared to $798.8 million at Dec. 31, 2015. At
March 31, 2016, the company’s total debt outstanding was $348.5
million.
Financial Expectations
Alkermes reiterates all of its financial expectations for 2016
set forth in its press release dated Feb. 25, 2016.
Conference Call
Alkermes will host a conference call at 8:30 a.m. EDT (1:30 p.m.
BST) on Thursday, April 28, 2016, to discuss these financial
results and provide an update on the company. The conference call
may be accessed by dialing +1 888 424 8151 for U.S. callers and +1
847 585 4422 for international callers. The conference call ID
number is 6037988. In addition, a replay of the conference call
will be available from 11:00 a.m. EDT (4:00 p.m. BST) on Thursday,
April 28, 2016, through 5:00 p.m. EDT (10:00 p.m. BST) on Thursday,
May 5, 2016, and may be accessed by visiting Alkermes’ website or
by dialing +1 888 843 7419 for U.S. callers and +1 630 652 3042 for
international callers. The replay access code is 6037988.
About AlkermesAlkermes
plc is a fully integrated, global biopharmaceutical company
developing innovative medicines for the treatment of central
nervous system (CNS) diseases. The company has a diversified
commercial product portfolio and a substantial clinical pipeline of
product candidates for chronic diseases that include schizophrenia,
depression, addiction and multiple sclerosis. Headquartered in
Dublin, Ireland, Alkermes plc has an R&D center in Waltham,
Massachusetts; a research and manufacturing facility in Athlone,
Ireland; and a manufacturing facility in Wilmington, Ohio. For more
information, please visit Alkermes’ website
at www.alkermes.com.
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 (loss) and non-GAAP diluted earnings (loss) per
share. 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.
Non-GAAP net income (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.
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
(loss) and non-GAAP diluted earnings (loss) per share 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 in this press release 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 clinical
development activities. 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; the results of such clinical
development activities may not be positive, or 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 U.S. Food and Drug Administration or
regulatory authorities outside the U.S. may make adverse decisions
regarding the company’s products; the company’s products may prove
difficult to manufacture, be precluded from commercialization by
the proprietary rights of third parties, or have unintended side
effects, adverse reactions or incidents of misuse; and those risks
and uncertainties described under the heading “Risk Factors” in the
company’s Annual Report on Form 10-K for the fiscal year ended Dec.
31, 2015, and in any other subsequent filings made by the company
with the Securities and Exchange Commission (“SEC”) and which are
available on the SEC’s website at www.sec.gov. Existing and
prospective investors are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
they are made. The information contained in this press release is
provided by the company as of the date hereof, and, except as
required by law, the company disclaims any intention or
responsibility for updating or revising any forward-looking
information contained in this press release.
VIVITROL® is a registered trademark of Alkermes, Inc.; ARISTADA®
is a registered trademark of Alkermes Pharma Ireland Limited;
RISPERDAL CONSTA®, INVEGA SUSTENNA®, XEPLION® and INVEGA TRINZA®
are registered trademarks of Johnson & Johnson; AMPYRA® and
FAMPYRA® are registered trademarks of Acorda Therapeutics, Inc.;
BYDUREON® is a registered trademark of Amylin Pharmaceuticals,
LLC.
1AMPYRA® (dalfampridine) Extended Release Tablets, 10 mg is
developed and marketed in the U.S. by Acorda Therapeutics, Inc. and
outside the U.S. by Biogen Idec, under a licensing agreement with
Acorda Therapeutics, as FAMPYRA® (prolonged-release fampridine
tablets).
(tables follow)
Alkermes plc and Subsidiaries Selected Financial
Information (Unaudited)
Three Months Three Months Ended Ended
Condensed Consolidated
Statements of Operations - GAAP March 31, March 31,
(In
thousands, except per share data) 2016 2015
Revenues: Manufacturing and royalty revenues $ 106,159 $ 128,744
Product sales, net 49,374 31,137 Research and development revenues
1,241 1,333 Total Revenues
156,774 161,214 Expenses: Cost of goods
manufactured and sold 27,711 39,974 Research and development
101,072 70,278 Selling, general and administrative 89,719 63,050
Amortization of acquired intangible assets 15,156
15,220 Total Expenses 233,658
188,522 Operating Loss (76,884 ) (27,308 )
Other Expense, net: Interest income 1,011 660 Interest expense
(3,295 ) (3,288 ) Increase in the fair value of contingent
consideration 1,900 - Other income (expense), net 249
(211 ) Total Other Expense, net (135 ) (2,839
) Loss Before Income Taxes (77,019 ) (30,147 ) Income
Tax Provision 404 510
Net Loss —
GAAP $ (77,423 ) $ (30,657 )
(Loss) Earnings Per
Share: GAAP loss per share — basic and diluted $ (0.51 ) $
(0.21 ) Non-GAAP (loss) earnings per share — basic and diluted $
(0.16 ) $ 0.06
Weighted Average Number of Ordinary
Shares Outstanding: Basic and Diluted — GAAP 150,825
148,089 Basic — Non-GAAP 150,825
148,089 Diluted — Non-GAAP 150,825
157,416 An itemized reconciliation between net
loss on a GAAP basis and non-GAAP net (loss) income is as follows:
Net Loss — GAAP $ (77,423 ) $ (30,657 ) Adjustments:
Share-based compensation expense 24,256 17,329 Amortization expense
15,156 15,220 Depreciation expense 7,548 7,266 Decrease in the fair
value of common stock warrants 870 - Non-cash net interest expense
232 236 Deferred revenue (442 ) (328 ) Increase in the fair value
of contingent consideration (1,900 ) - Non-cash taxes (2,863 ) 488
Upfront license option payment to Reset Therapeutics, Inc. charged
to R&D expense 10,000 - Net gain on transactions with equity
method investee - (397 )
Non-GAAP Net
(Loss) Income $ (24,566 ) $ 9,157
Condensed Consolidated Balance
Sheets March 31, December 31,
(In thousands) 2016
2015 Cash, cash equivalents and total investments $ 719,380
$ 798,849 Receivables 139,814 155,487 Inventory 44,817 38,411
Prepaid expenses and other current assets 28,539 26,286 Property,
plant and equipment, net 256,326 254,819 Intangible assets, net and
goodwill 456,903 472,059 Other assets 149,108 109,833
Total Assets $ 1,794,887 $ 1,855,744 Long-term debt —
current portion $ 64,825 $
65,737
Other current liabilities 159,306 170,470 Long-term debt 283,664
284,207 Deferred revenue — long-term 7,442 7,975 Other long-term
liabilities 14,572 13,080 Total shareholders' equity
1,265,078 1,314,275
Total Liabilities and Shareholders'
Equity $ 1,794,887 $ 1,855,744 Ordinary shares
outstanding (in thousands) 151,082 150,701
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 months ended March 31, 2016, which the company
intends to file in April 2016.
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