"Our second quarter results reflect the growth of VIVITROL® and ARISTADA®, driven by underlying unit demand and continued upside from our royalty and manufacturing business. While driving revenue expansion, we are making important investments to further accelerate growth of VIVITROL and ARISTADA, and continue to invest in our research & development programs. These investments are designed to support sustainable, long-term growth," commented
"The second quarter was highlighted by important data presentations for ARISTADA and ALKS 3831, as we work to establish
Quarter Ended
- Total revenues for the quarter were
$279.9 million , compared to$304.6 million for the same period in the prior year, reflecting growth in our proprietary product net sales, partially offset by a decrease in AMPYRAi revenues following generic entry in 2018. In addition, the quarter endedJune 30, 2018 included$48.3 million of license revenue from the collaboration with Biogen for diroximel fumarate. - Net loss according to generally accepted accounting principles in the U.S. (GAAP) was
$42.0 million for the quarter, or a basic and diluted GAAP net loss per share of$0.27 . This compared to GAAP net loss of$32.6 million , or a basic and diluted GAAP net loss per share of$0.21 , for the same period in the prior year. - Non-GAAP net income was
$13.7 million for the quarter, or a non-GAAP basic and diluted net earnings per share of$0.09 . This compared to non-GAAP net income of$45.6 million , or a non-GAAP basic and diluted net earnings per share of$0.29 , for the same period in the prior year.
Quarter Ended
Revenues
- Net sales of VIVITROL were
$88.2 million , compared to$76.2 million for the same period in the prior year, representing an increase of approximately 16%. - Net sales of ARISTADAii were
$48.4 million , compared to$33.6 million for the same period in the prior year, representing an increase of approximately 44%. - Manufacturing and royalty revenues from RISPERDAL CONSTA®, INVEGA SUSTENNA®/XEPLION® and INVEGA TRINZA®/TREVICTA® were
$91.9 million , compared to$85.2 million for the same period in the prior year. - Manufacturing and royalty revenues from AMPYRA/FAMPYRA® were
$9.8 million , compared to$19.7 million for the same period in the prior year, due to generic competition to AMPYRA entering the market in 2018. - Research and development revenues were
$14.3 million , compared to$18.3 million for the same period in the prior year. These revenues were primarily related to the collaboration with Biogen for diroximel fumarate. - License revenue was
$1.0 million . This compared to$48.3 million for the same period in the prior year, which reflected receipt of a payment from Biogen under the collaboration for diroximel fumarate.
Costs and Expenses
- Operating expenses were
$315.8 million , compared to$304.7 million for the same period in the prior year, primarily reflecting increased investment in the commercialization of VIVITROL and ARISTADA and in the development of ALKS 4230.
Financial Expectations for 2019
Recent Events:
- ARISTADA
- Presented new safety and tolerability data from the ALPINE (Aripiprazole Lauroxil and Paliperidone palmitate: INitiation Effectiveness) study at the
American Society of Clinical Psychopharmacology (ASCP) annual meeting, which underscored the clinical utility of ARISTADA and long-acting therapies for schizophrenia. - ALKS 3831
- Following completion of a pre-New Drug Application (NDA) meeting with the
FDA , announced plans to expand the ALKS 3831 NDA to include an indication for the treatment of bipolar I disorder, in addition to the treatment of schizophrenia. The NDA for ALKS 3831 will include data from the completed ALKS 3831 ENLIGHTEN clinical development program in patients with schizophrenia as well as pharmacokinetic bridging data comparing ALKS 3831 and ZYPREXA® (olanzapine). - VUMERITY (diroximel fumarate)
- Biogen presented new interim tolerability data from the ongoing open-label, pivotal EVOLVE-MS-1 study in people with relapsing multiple sclerosis at the annual meeting of the
Consortium of Multiple Sclerosis Centers (CMSC). - ALKS 4230
- Initiated monotherapy expansion phase of ARTISTRY-1 to evaluate the efficacy, safety and tolerability of ALKS 4230 in treating patients with renal cell carcinoma or melanoma, following selection of the recommended phase 2 dose in the dose-escalation stage of ARTISTRY-1.
Conference Call
About
Non-GAAP Financial Measures
This press release includes information about certain financial measures that are not prepared in accordance with GAAP, including non-GAAP net income and non-GAAP basic and diluted net earnings 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 adjusts for one-time and non-cash charges by excluding from GAAP results: share-based compensation expense; amortization; depreciation; non-cash net interest expense; certain other one-time or non-cash items; change in the fair value of contingent consideration; change in the fair value of warrants and equity method investments; and the income tax effect of these reconciling items.
The company's management and board of directors utilize these non-GAAP financial measures to evaluate the company's performance. The company provides these non-GAAP measures of the company's performance to investors because management believes that these non-GAAP financial measures, when viewed with the company's results under GAAP and the accompanying reconciliations, are useful in identifying underlying trends in ongoing operations. However, non-GAAP net income and non-GAAP basic and diluted net earnings 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. Further, non-GAAP net income and non-GAAP basic and diluted net earnings per share should not be considered measures of our liquidity.
A reconciliation of certain 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: the company's business plans or prospects; the company's expectations concerning future financial and operating performance, including expectations of continued revenue growth from the company's commercial products and products for which the company receives royalties; expectations concerning the company's continued investment in its development pipeline and commercial products and capabilities, and the value that can be derived therefrom; the potential therapeutic and commercial value of the company's marketed and development products; expectations concerning the timing, details and results of the company's clinical development activities, including obtaining the first efficacy data for ALKS 4230; and the company's expectations and timelines for regulatory activities and interactions with the
VIVITROL® is a registered trademark of
(tables follow)
i AMPYRA® (dalfampridine) Extended Release Tablets, 10 mg is developed and marketed in the U.S. by Acorda.
ii The term "ARISTADA" as used in this press release refers to ARISTADA and ARISTADA INITIO®, unless the context indicates otherwise.
Alkermes plc and Subsidiaries |
||||
Selected Financial Information (Unaudited) |
||||
Condensed Consolidated Statements of Operations - GAAP |
Three Months Ended |
Three Months Ended |
||
(In thousands, except per share data) |
June 30, 2019 |
June 30, 2018 |
||
Revenues: |
||||
Manufacturing and royalty revenues |
$ 127,897 |
$ 128,241 |
||
Product sales, net |
136,635 |
109,807 |
||
Research and development revenue |
14,340 |
18,344 |
||
License revenue |
1,000 |
48,250 |
||
Total Revenues |
279,872 |
304,642 |
||
Expenses: |
||||
Cost of goods manufactured and sold |
46,223 |
43,417 |
||
Research and development |
104,435 |
106,823 |
||
Selling, general and administrative |
155,075 |
138,257 |
||
Amortization of acquired intangible assets |
10,062 |
16,247 |
||
Total Expenses |
315,795 |
304,744 |
||
Operating Loss |
(35,923) |
(102) |
||
Other Expense, net: |
||||
Interest income |
3,706 |
1,900 |
||
Interest expense |
(3,520) |
(3,126) |
||
Change in the fair value of contingent consideration |
(6,500) |
(19,600) |
||
Other income (expense), net |
1,851 |
(3,517) |
||
Total Other Expense, net |
(4,463) |
(24,343) |
||
Loss Before Income Taxes |
(40,386) |
(24,445) |
||
Income Tax Provision |
1,604 |
8,204 |
||
Net Loss — GAAP |
$ (41,990) |
$ (32,649) |
||
Net (Loss) Earnings Per Share: |
||||
GAAP net loss per share — basic and diluted |
$ (0.27) |
$ (0.21) |
||
Non-GAAP net earnings per share — basic and diluted |
$ 0.09 |
$ 0.29 |
||
Weighted Average Number of Ordinary Shares Outstanding: |
||||
Basic and diluted — GAAP |
156,991 |
155,176 |
||
Basic — Non-GAAP |
156,991 |
155,176 |
||
Diluted — Non-GAAP |
158,987 |
159,761 |
||
An itemized reconciliation between net loss on a GAAP basis and non-GAAP net income is as follows: |
||||
Net Loss — GAAP |
$ (41,990) |
$ (32,649) |
||
Adjustments: |
||||
Share-based compensation expense |
28,245 |
30,933 |
||
Amortization expense |
10,062 |
16,247 |
||
Depreciation expense |
9,852 |
9,521 |
||
Change in the fair value of contingent consideration |
6,500 |
19,600 |
||
Income tax effect related to reconciling items |
2,043 |
512 |
||
Non-cash net interest expense |
168 |
170 |
||
Change in the fair value of warrants and equity method investments |
(1,134) |
1,269 |
||
Non-GAAP Net Income |
$ 13,746 |
$ 45,603 |
Condensed Consolidated Statements of Operations - GAAP |
Six Months Ended |
Six Months Ended |
||
(In thousands, except per share data) |
June 30, 2019 |
June 30, 2018 |
||
Revenues: |
||||
Manufacturing and royalty revenues |
$ 236,812 |
$ 242,842 |
||
Product sales, net |
236,116 |
201,649 |
||
Research and development revenue |
29,046 |
37,051 |
||
License revenue |
1,000 |
48,250 |
||
Total Revenues |
502,974 |
529,792 |
||
Expenses: |
||||
Cost of goods manufactured and sold |
91,584 |
87,893 |
||
Research and development |
207,005 |
215,169 |
||
Selling, general and administrative |
296,295 |
256,404 |
||
Amortization of acquired intangible assets |
20,014 |
32,316 |
||
Total Expenses |
614,898 |
591,782 |
||
Operating Loss |
(111,924) |
(61,990) |
||
Other Expense, net: |
||||
Interest income |
7,276 |
3,385 |
||
Interest expense |
(7,020) |
(8,613) |
||
Change in the fair value of contingent consideration |
(29,100) |
(21,500) |
||
Other income (expense), net |
130 |
(2,725) |
||
Total Other Expense, net |
(28,714) |
(29,453) |
||
Loss Before Income Taxes |
(140,638) |
(91,443) |
||
Income Tax (Benefit) Provision |
(2,250) |
3,711 |
||
Net Loss — GAAP |
$ (138,388) |
$ (95,154) |
||
Net (Loss) Earnings Per Share: |
||||
GAAP net loss per share — basic and diluted |
$ (0.88) |
$ (0.61) |
||
Non-GAAP net (loss) earnings per share — basic and diluted |
$ (0.08) |
$ 0.20 |
||
Weighted Average Number of Ordinary Shares Outstanding: |
||||
Basic and diluted — GAAP |
156,665 |
154,802 |
||
Basic — Non-GAAP |
156,665 |
154,802 |
||
Diluted — Non-GAAP |
156,665 |
160,472 |
||
An itemized reconciliation between net loss on a GAAP basis and non-GAAP net (loss) income is as follows: |
||||
Net Loss — GAAP |
$ (138,388) |
$ (95,154) |
||
Adjustments: |
||||
Share-based compensation expense |
52,861 |
50,975 |
||
Amortization expense |
20,014 |
32,316 |
||
Depreciation expense |
19,542 |
19,174 |
||
Change in the fair value of contingent consideration |
29,100 |
21,500 |
||
Income tax effect related to reconciling items |
5,015 |
(4,666) |
||
Non-cash net interest expense |
337 |
361 |
||
Change in the fair value of warrants and equity method investments |
(701) |
967 |
||
Restructuring expense |
— |
3,598 |
||
Debt refinancing charge |
— |
2,298 |
||
Non-GAAP Net (Loss) Income |
$ (12,220) |
$ 31,369 |
Condensed Consolidated Balance Sheets |
June 30, |
December 31, |
||
(In thousands) |
2019 |
2018 |
||
Cash, cash equivalents and total investments |
$ 593,593 |
$ 620,039 |
||
Receivables |
261,226 |
292,223 |
||
Contract assets |
12,690 |
8,230 |
||
Inventory |
94,780 |
90,196 |
||
Prepaid expenses and other current assets |
55,607 |
53,308 |
||
Property, plant and equipment, net |
326,230 |
309,987 |
||
Intangible assets, net and goodwill |
263,859 |
283,874 |
||
Other assets |
143,766 |
167,150 |
||
Total Assets |
$ 1,751,751 |
$ 1,825,007 |
||
Long-term debt — current portion |
$ 2,843 |
$ 2,843 |
||
Other current liabilities |
331,303 |
336,931 |
||
Long-term debt |
275,381 |
276,465 |
||
Contract liabilities — long-term |
11,621 |
9,525 |
||
Other long-term liabilities |
39,435 |
27,958 |
||
Total shareholders' equity |
1,091,168 |
1,171,285 |
||
Total Liabilities and Shareholders' Equity |
$ 1,751,751 |
$ 1,825,007 |
||
Ordinary shares outstanding (in thousands) |
157,097 |
155,757 |
||
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, 2019, which the company intends to file in July 2019. |
Alkermes Contacts:
For Investors: Sandy Coombs +1 781 609 6377
For Media:
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