-- Preparing for BG-12 Launch and Four Phase 3 Data Readouts in Next
Nine Months --
Second graph after the first series of bullets should read: The company
also completed its previously ... (sted During the second quarter, the
company also completed its previously ...).
The corrected release reads:
BIOGEN IDEC INCREASES REVENUE 18% TO $1.4 BILLION IN THE SECOND
QUARTER
-- Preparing for BG-12 Launch and Four Phase 3 Data Readouts in Next
Nine Months --
Biogen Idec Inc. (NASDAQ: BIIB), a global biotechnology leader in the
discovery, development, manufacturing and commercialization of
innovative therapies, today announced its second quarter 2012 results.
Second Quarter 2012 Highlights:
Second quarter revenues increased 18% to $1.4 billion, compared to the
second quarter of 2011. TYSABRI® (natalizumab)
revenues were $280 million, in-line with the second quarter of 2011.
AVONEX® (interferon beta-1a) revenues increased 16%
year-over-year to $762 million. RITUXAN® (rituximab)
revenues from our unconsolidated joint business arrangement were $285
million for the quarter, an increase of 31% year-over-year. As
previously disclosed, during the second quarter of 2011 our share of
RITUXAN revenues from unconsolidated joint business was reduced by
approximately $50 million to reflect our share of damages and interest
that might be awarded in relation to an intermediate decision in
Genentech, Inc.'s ongoing arbitration with Hoechst GmbH.
Global in-market sales of TYSABRI in the second quarter of 2012 were
$395 million, an increase of 2% over the second quarter of 2011. The
total was comprised of $211 million in U.S. sales and $184 million in
sales outside the U.S.
Second quarter 2012 GAAP diluted EPS were $1.61, an increase of 36%
over the second quarter of 2011. GAAP net income attributable to
Biogen Idec for the quarter was $387 million, an increase of 34% from
the second quarter of 2011.
Non-GAAP diluted EPS for the second quarter of 2012 were $1.82, an
increase of 34% over the second quarter of 2011. Non-GAAP net income
attributable to Biogen Idec for the second quarter of 2012 was $439
million, an increase of approximately 32% from the second quarter of
2011. A reconciliation of our GAAP to non-GAAP results is included on
Table 3 within this press release.
As of June 30, 2012, Biogen Idec had cash, cash equivalents and
marketable securities of approximately $2.9 billion.
The company also completed its previously announced $500 million share
repurchase for the purpose of retiring shares and returning capital to
shareholders.
"At the midpoint of a pivotal year, we continue to succeed in the
marketplace and track against our goals," said George A. Scangos, Ph.D.,
the company's chief executive officer. "AVONEX performance was
particularly strong in the second quarter. There has been strong uptake
of the AVONEX PEN® and AVOSTARTGRIPTM
titration dosing kit in both the US and EU. We have a busy nine months
ahead of us preparing for the BG-12 launch and four pivotal trial data
readouts -- for our long-lasting blood factors VIII and IX for
hemophilia, dexpramipexole for ALS and PEGylated interferon beta-1a for
multiple sclerosis. We continued to strengthen our early-stage pipeline
and stepped up the pace of revitalizing our discovery efforts. We had a
very productive quarter, delivering both revenue and earnings growth,
while continuing to invest in the company's future."
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
2012, we estimate that approximately 69,100 patients were on commercial
and clinical TYSABRI therapy worldwide, and that cumulatively
approximately 104,300 patients have ever been treated with TYSABRI in
the post-marketing setting.
Building for the Future
The company is preparing for the potential of multiple product launches
in the coming years. In addition to earlier filings in the U.S. and EU,
Biogen Idec filed in Canada, Switzerland and Australia in the second
quarter for regulatory approval for BG-12 (dimethyl fumarate), its oral
drug candidate for the treatment of multiple sclerosis (MS).
Biogen Idec also continued to advance its R&D pipeline, initiating two
global pediatric studies for its long-lasting factor VIII and factor IX
programs for hemophilia and completing enrollment in the Phase 3 A-LONG
and B-LONG trials for the long-lasting blood factors as well as the
Phase 3 DECIDE study of daclizumab in MS. We enrolled our first patient
in the Phase 2a study for STX-100, a novel monoclonal antibody, in
idiopathic pulmonary fibrosis (IPF). We also added a preclinical program
through a second worldwide option and collaboration agreement with Isis
Pharmaceuticals Inc. to develop and commercialize a novel antisense drug
for the treatment of myotonic dystrophy type 1 (DM1), which is the most
common form of muscular dystrophy in adults. The company remains on
track for phase III data readouts in the second half of the year for its
long-lasting blood factors and dexpramipexole for amyotrophic lateral
sclerosis (ALS).
As part of an ongoing effort to stimulate its drug discovery engine, the
company is funding a consortium of world-class ALS researchers from six
top academic and research institutions to map the genomes of up to 1,000
patients with ALS within five years.
Other Products and Royalty Revenues
Revenues from other products in the second quarter of 2012 were $34
million, compared to $16 million in the second quarter of 2011.
Table 4 provides individual product revenues.
Royalty revenues were $37 million in the second quarter of 2012, an
increase of 29% compared to the second quarter of 2011.
For the second quarter of 2012, corporate partner revenues were $22
million, compared to $7 million in the second quarter of 2011.
Updated 2012 Financial Guidance
Biogen Idec also updated its full year 2012 financial guidance. This
guidance consists of the following components:
Revenue growth is expected to be in the mid-single digits versus 2011.
Cost of Sales is expected to be approximately 9% to 10% of total
revenue.
R&D expense is expected to be approximately 24% to 25% of total
revenue.
SG&A expense is expected to be approximately 22% to 23% of total
revenue.
Tax expense is expected to be approximately 23% to 25% of pretax
income.
Non-GAAP diluted EPS is expected to be above $6.20.
GAAP diluted EPS is expected to be above $5.44.
Capital expenditures are expected to be in the range of $230 to $250
million.
Biogen Idec may incur charges, realize gains or experience other events
in 2012 that could cause actual results to vary from this guidance.
Recent Events
Last week, the first patient was enrolled in a Phase 2a study for
STX-100 in IPF. IPF is a debilitating and almost uniformly fatal
disease in which patients experience progressive difficulty breathing
due to fibrosis of the lung. More than 200,000 patients in the United
States and Europe have IPF, and there is no FDA-approved treatment for
the disease at this time. STX-100 is a novel humanized monoclonal
antibody that selectively disrupts the TGF-beta pathway, which plays a
central role in fibrotic disease.
On July 17, Biogen Idec announced that it entered into a research
collaboration with premiere academic and research institutions to
sequence the genomes of patients with ALS to gain a deeper
understanding about the fundamental genetic causes of ALS. Biogen Idec
will fund the project, which will bring together seven world-class ALS
researchers from Duke University, HudsonAlpha Institute for
Biotechnology, Columbia University, Stanford University, University of
Massachusetts Medical School and University of Montreal.
On July 5, Biogen Idec and Swedish Orphan Biovitrum (SOBI) announced
the initiation of two global pediatric clinical trials of the
companies' long-lasting recombinant factor VIII and factor IX Fc
fusion proteins (rFVIIIFc and rFIXFc) in hemophilia A and B. rFVIIIFc
and rFIXFc are fully-recombinant clotting factors developed using
Biogen Idec's novel and proprietary monomeric Fc-fusion technology.
Biogen Idec and SOBI are studying this technology to see whether it
extends half-life and enables the proteins to last longer in the body
than commercially available factor products.
Second Quarter Events
On June 29, Biogen Idec and Isis Pharmaceuticals, Inc. announced that
they have entered into an exclusive, worldwide option and
collaboration agreement under which the companies will develop and
commercialize a novel antisense drug for DM1. DM1 is a genetic
neuromuscular disease characterized by progressive muscle atrophy,
weakness and disabling muscle spasms. It is caused by a genetic defect
in the dystrophia myotonica-protein kinase (DMPK) gene in which a
sequence of three nucleotides repeats extensively, creating an
abnormally long toxic RNA, which accumulates in the cell and prevents
the production of proteins needed for normal cellular function. Isis'
DM1 antisense program is being developed to correct the underlying
genetic defect that causes DM1.
On June 20, Biogen Idec, along with Massachusetts Governor Deval
Patrick and six other biotechnology and pharmaceutical companies,
announced the formation of the Massachusetts Neuroscience Consortium.
The Consortium will fund neuroscience research at Massachusetts
academic and research institutions. The six other participating
companies are Abbott, EMD Serono, Janssen Research & Development,
Merck, Pfizer and Sunovion Pharmaceuticals.
On June 12, Biogen Idec hosted an Analyst Day which provided an update
for the investment community on the company's commercial strategy,
select late and early-stage clinical development programs, as well as
the revitalization of its research organization. The event was led by
Dr. Scangos, Tony Kingsley, Executive Vice President of Global
Commercial Operations, and Douglas Williams, Executive Vice President
of Research and Development, along with other members of the Biogen
Idec scientific leadership team.
On May 17, Biogen Idec and Elan Corporation announced the New England
Journal of Medicine published research from the companies' global risk
management program that updates the risk of TYSABRI-associated
progressive multifocal leukoencephalopathy (PML), an infrequent but
serious brain infection, in people with MS. The analysis looked at
three risk factors associated with a patient's PML risk: anti-JC virus
(JCV) antibody status, use of immunosuppressant (IS) therapy prior to
TYSABRI initiation, and longer duration of treatment with TYSABRI.
Biogen Idec and Elan developed the quantitative risk stratification
algorithm to help physicians and people with MS have more confidence
in their treatment decisions when considering TYSABRI, a highly
effective treatment for relapsing forms of MS.
On May 14, Biogen Idec announced that two new dosing innovations
designed to help patients receiving once-a-week AVONEX for relapsing
forms of MS became available in U.S. pharmacies:
The new AVONEX PEN® (AVONEX 30mcg/0.5mL solution for
injection) is the first intramuscular (IM) autoinjector for
chronic use, designed to enhance the self-injection process for
patients receiving AVONEX therapy.
A new dose titration regimen, facilitated by the AVOSTARTGRIPTM
titration devices, provides patients with the option to gradually
increase the dose of AVONEX at treatment initiation to reduce the
incidence and severity of flu-like symptoms that patients may
experience with therapy.
On May 9, Biogen Idec announced that U.S. and EU regulatory
authorities accepted the company's marketing applications for the
review of BG-12. The U.S. FDA accepted Biogen Idec's New Drug
Application for marketing approval of BG-12 in the US and granted the
company a standard review timeline. In addition, the EMA validated
Biogen Idec's Marketing Authorisation Application for review of BG-12
in the EU.
Conference Call and Webcast
The company's earnings conference call for the second quarter will be
broadcast via the internet at 8:00 a.m. ET on July 24, 2012, and will be
accessible through the Investors section of Biogen Idec's 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 for
one month.
About Biogen Idec
Through cutting-edge science and medicine, Biogen Idec discovers,
develops and delivers to patients worldwide innovative therapies for the
treatment of neurodegenerative diseases, hemophilia and autoimmune
disorders. Founded in 1978, Biogen Idec is the world's oldest
independent biotechnology company. Patients worldwide benefit from its
leading multiple sclerosis therapies, and the company generates more
than $5 billion in annual revenues. For product labeling, press releases
and additional information about the company, please visit www.biogenidec.com.
About AVONEX
AVONEX is one of the most prescribed treatments for relapsing forms of
MS worldwide. AVONEX is indicated for the treatment of patients with
relapsing forms of MS to slow the accumulation of physical disability
and decrease the frequency of clinical exacerbations. Patients with MS
in whom efficacy has been demonstrated include patients who have
experienced a first clinical episode and have MRI features consistent
with MS.
Symptoms of depression, suicidal ideation, or psychosis, and cases of
suicide, have been reported with increased frequency with patients
receiving AVONEX. Severe hepatic injury, including cases of hepatic
failure has been reported rarely in patients. Rare cases of anaphylaxis
have been reported. While beta interferons do not have any known direct
cardiac toxicity, cases of congestive heart failure, cardiomyopathy, and
cardiomyopathy with congestive heart failure have been reported in
patients without known predisposition. Decreased peripheral blood counts
have been reported from postmarketing experience. Seizures have been
reported in patients using AVONEX, including patients with no prior
history of seizure. Autoimmune disorders of multiple target organs have
been reported. Routine periodic blood chemistry, hematology, liver
function, and thyroid function tests are recommended. There are no
adequate and well-controlled studies in pregnant women. AVONEX should be
used during pregnancy only if the potential benefit justifies the
potential risk to the fetus. The most common side effects associated
with AVONEX treatment are flu-like symptoms, including chills, fever,
myalgia, and asthenia.
For additional important safety information, and the complete United
States full prescribing information, please visit www.AVONEX.com.
About TYSABRI
TYSABRI is approved in more than 65 countries. TYSABRI is approved in
the United States as a monotherapy for relapsing forms of MS, generally
for patients who have had an inadequate response to, or are unable to
tolerate, an alternative MS therapy. In the European Union, it is
approved for highly active relapsing-remitting MS (RRMS) in adult
patients who have failed to respond to beta interferon or have rapidly
evolving, severe RRMS.
TYSABRI has advanced the treatment of MS patients with its established
efficacy. Data from the Phase 3 AFFIRM trial, which was published in the
New England Journal of Medicine, showed that after two years, TYSABRI
treatment led to a 68 percent relative reduction (p<0.001) in the
annualized relapse rate when compared with placebo and reduced the
relative risk of disability progression by 42-54 percent (p<0.001).
TYSABRI increases the risk of progressive multifocal leukoencephalopathy
(PML), an opportunistic viral infection of the brain, which usually
leads to death or severe disability. Infection by the JC virus (JCV) is
required for the development of PML and patients who are anti-JCV
antibody positive have a higher risk of developing PML. Factors that
increase the risk of PML are presence of anti-JCV antibodies, prior
immunosuppressant use, and longer TYSABRI treatment duration. Patients
who have all three risk factors have the highest risk of developing PML.
Other serious adverse events that have occurred in TYSABRI-treated
patients include hypersensitivity reactions (e.g., anaphylaxis) and
infections, including opportunistic and other atypical infections.
Clinically significant liver injury has also been reported in the
post-marketing setting. A list of adverse events can be found in the
full TYSABRI product labeling for each country where it is approved.
TYSABRI is marketed and distributed by Biogen Idec Inc. and Elan
Corporation, plc. For full prescribing information, including boxed
warning and important safety information, and more information about
TYSABRI, please visit www.biogenidec.com
or www.elan.com.
Safe Harbor
This press release contains forward-looking statements, including
statements about potential product launches, 2012 financial guidance,
clinical trial readouts and progress, and potential therapies. 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,
TYSABRI and RITUXAN the importance of TYSABRI's sales growth,
uncertainty of success in commercializing other products, product
competition, 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 comply with government regulation, our ability to protect our
intellectual property rights, and have sufficient rights to market our
products and services together with the cost of doing so, problems with
our manufacturing processes and our reliance on third parties, the risks
of doing business internationally, failure to execute our growth
initiatives, charges and other costs relating to our properties,
fluctuations in our effective tax rate, our ability to attract and
retain qualified personnel, 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, change of control provisions in our collaborations
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. and Subsidiaries
Condensed Consolidated Statements of Income
(unaudited, in thousands, except per share amounts)
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
2012
2011
2012
2011
Revenues:
Product
$
1,076,800
$
956,703
$
2,052,288
$
1,863,805
Unconsolidated joint business
284,630
216,458
569,183
472,583
Royalty
37,084
28,649
65,884
54,227
Corporate partner
22,437
6,837
25,611
21,375
Total revenues
1,420,951
1,208,647
2,712,966
2,411,990
Cost and expenses:
Cost of sales, excluding amortization of acquired intangible assets
139,112
100,503
272,308
203,616
Research and development
329,559
285,644
685,521
579,277
Selling, general and administrative
301,767
266,301
601,856
510,819
Collaboration profit sharing
78,511
88,050
164,406
162,844
Amortization of acquired intangible assets
52,282
55,136
98,243
108,352
Fair value adjustment of contingent consideration
12,858
2,200
14,117
3,400
Restructuring charge
1,139
-
1,422
16,587
Total cost and expenses
915,228
797,834
1,837,873
1,584,895
Income from operations
505,723
410,813
875,093
827,095
Other income (expense), net
2,950
(11,728
)
18,094
(1,777
)
Income before income tax expense and equity in loss of investee,
net of tax
508,673
399,085
893,187
825,318
Income tax expense
121,021
95,036
203,169
212,504
Equity in loss of investee, net of tax
511
-
511
-
Net income
387,141
304,049
689,507
612,814
Net income attributable to non-controlling interests, net of tax
295
16,015
-
30,450
Net income attributable to Biogen Idec Inc.
$
386,846
$
288,034
$
689,507
$
582,364
Net income per share:
Basic earnings per share attributable to Biogen Idec Inc.
$
1.62
$
1.19
$
2.88
$
2.40
Diluted earnings per share attributable to Biogen Idec Inc.
$
1.61
$
1.18
$
2.86
$
2.38
Weighted-average shares used in calculating:
Basic earnings per share attributable to Biogen Idec Inc.
238,988
242,375
239,389
241,932
Diluted earnings per share attributable to Biogen Idec Inc.
240,622
244,966
241,245
244,899
TABLE 2
Biogen Idec Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(unaudited, in thousands)
As of
As of
June 30,
December 31,
2012
2011
ASSETS
Cash, cash equivalents and marketable securities
$
1,406,050
$
1,690,657
Accounts receivable, net
683,841
584,603
Inventory
362,940
326,843
Other current assets
416,088
373,324
Total current assets
2,868,919
2,975,427
Marketable securities
1,467,909
1,416,737
Property, plant and equipment, net
1,622,812
1,571,387
Intangible assets, net
1,732,972
1,608,191
Goodwill
1,197,904
1,146,314
Investments and other assets
271,864
331,548
TOTAL ASSETS
$
9,162,380
$
9,049,604
LIABILITIES AND EQUITY
Current portion of notes payable and line of credit
$
453,045
$
3,292
Other current liabilities
979,820
909,597
Long-term deferred tax liability
282,904
248,644
Notes payable, line of credit and other financing arrangements
641,568
1,060,808
Other long-term liabilities
534,358
400,276
Equity
6,270,685
6,426,987
TOTAL LIABILITIES AND EQUITY
$
9,162,380
$
9,049,604
TABLE 3
Biogen Idec Inc. and Subsidiaries
Condensed Consolidated Statements of Income - Non-GAAP
(unaudited, in millions, except per share amounts)
For the Three Months
For the Six Months
Ended June 30,
Ended June 30,
EARNINGS PER SHARE
2012
2011
2012
2011
GAAP earnings per share - Diluted
$
1.61
$
1.18
$
2.86
$
2.38
Adjustments to net income attributable to Biogen Idec Inc. (as
detailed below)
0.21
0.18
0.36
0.40
Non-GAAP earnings per share - Diluted
$
1.82
$
1.36
$
3.22
$
2.78
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.
$
386.8
$
288.0
$
689.5
$
582.4
Adjustments:
R&D: Stock option expense
0.5
0.5
1.6
1.7
R&D: Restructuring charge and other
-
-
1.3
-
SG&A: Stock option expense
0.9
1.2
1.4
2.5
Amortization of acquired intangible assets
51.0
55.1
94.3
108.4
2010 Restructuring initiatives
1.1
-
1.4
16.6
Fair value adjustment of contingent consideration
12.9
2.2
14.1
3.4
Income tax expense: Income tax effect related to reconciling items
(14.4
)
(14.8
)
(26.1
)
(33.5
)
Non-controlling interests
0.3
-
-
-
Non-GAAP net income attributable to Biogen Idec Inc.
$
439.1
$
332.2
$
777.5
$
681.5
2012 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.
$
1,307
240
$
5.44
Adjustments:
Stock option expense
6
Restructuring and other
12
Amortization of acquired intangible assets
194
Fair value adjustment of contingent consideration
23
Income tax expense: Income tax effect related to reconciling items
(53
)
Projected Non-GAAP net income attributable to Biogen Idec Inc.
$
1,489
240
$
6.20
Use of Non-GAAP Financial Measures
We supplement our consolidated financial statements presented on a GAAP
basis by providing additional measures which may be considered
"non-GAAP" financial measures under applicable SEC rules. We believe
that the disclosure of these non-GAAP financial measures provides
additional insight into the ongoing economics of our business and
reflects how we manage our business internally, set operational goals
and forms the basis of our management incentive programs. These non-GAAP
financial measures are not in accordance with generally accepted
accounting principles in the United States and should not be viewed in
isolation or as a substitute for reported, or GAAP, net income
attributable to Biogen Idec Inc. and diluted earnings per share.
Our "Non-GAAP net income attributable to Biogen Idec Inc." and "Non-GAAP
earnings per share - Diluted" financial measures exclude the following
items from GAAP net income attributable to Biogen Idec Inc. and diluted
earnings per share:
1. Purchase accounting and merger-related
adjustments.
We exclude certain charges related to the 2003 merger between Biogen
Inc. and Idec Pharmaceuticals, Inc., certain acquisition-related items,
and certain amounts in relation to the consolidation of variable
interest entities for which we are the primary beneficiary. These
adjustments include charges for in-process research and development, the
amortization of certain acquired intangible assets and adjustments to
the fair value of our contingent consideration obligations. The
exclusion of these charges provides management and investors with a
supplemental measure of performance which the Company believes better
reflects the underlying economics of the business.
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.
3. Other items.
We evaluate other items 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 also include an adjustment to reflect the related tax effect of all
reconciling items within our reconciliation of our GAAP to Non-GAAP net
income attributable to Biogen Idec Inc.
TABLE 4
Biogen Idec Inc. and Subsidiaries
Product Revenues
(unaudited, in thousands)
For the Three Months
Ended June 30,
2012
2011
PRODUCT REVENUES
AVONEX®
$
762,065
$
659,233
TYSABRI®
280,423
281,383
FAMPYRA®
19,681
-
FUMADERM®
14,631
15,064
Other
-
1,023
Total product revenues
$
1,076,800
$
956,703
For the Six Months
Ended June 30,
2012
2011
PRODUCT REVENUES
AVONEX®
$
1,423,684
$
1,301,711
TYSABRI®
565,956
532,776
FAMPYRA®
34,721
-
FUMADERM®
27,927
27,570
Other
-
1,748
Total product revenues
$
2,052,288
$
1,863,805
Media Contact: Biogen Idec Amanda Brown Galgay, 781-464-3260 Senior
Manager, Public Affairs or Investment Community Contact: Biogen
Idec Ben Strain, 781-464-2442 Senior Manager, Investor
Relations
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