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SOURCE: The Medicines Company
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October 28, 2009 08:00 ET
The Medicines Company Reports Third Quarter 2009 Financial Results
Total Sales in Third Quarter Up 12%, Year to Date Up 19%, Despite Economic Pressures on U.S. Hospitals and Reduced PCI Volume
PARSIPPANY, NJ--(Marketwire - October 28, 2009) - The Medicines Company (NASDAQ: MDCO) today
announced its financial results for the third quarter of 2009.
Financial highlights for the third quarter of 2009:
-- Net revenue increased by 12% to $98.8 million for the third quarter of
2009 from $88.1 million for the third quarter of 2008.
-- Angiomax U.S. sales increased by 9% to $92.2 million in the third
quarter of 2009 compared to $85.0 million in the third quarter of
2008.
-- Angiomax/Angiox international net revenue in the third quarter of
2009 increased by 74% to $5.5 million compared to $3.1 million in
the third quarter of 2008.
-- Cleviprex has now been accepted by more than 345 hospital
formularies and has been purchased by more than 400 hospitals in
the United States. Net revenue in the third quarter of 2009 was
$1.1 million, up from $0.9 million in the second quarter.
-- Net loss for the third quarter of 2009 was ($3.2) million, or ($0.06)
per share, compared to a net loss of ($13.2) million, or ($0.25) per
share, for the third quarter of 2008.
-- Non-GAAP net income for the third quarter of 2009 was $5.1 million, or
$0.10 per share, compared to non-GAAP net income of $8.5 million, or
$0.16 per share, for the third quarter of 2008. Non-GAAP net income
excludes the transaction costs associated with the Targanta and
Curacyte acquisitions, stock-based compensation expense and non-cash
income taxes.
Clive Meanwell, Chairman and Chief Executive Officer, stated, "This was a
challenging quarter in terms of market dynamics. We estimate that
inpatient PCI volume declined 9% year on year, including a dramatic 17 %
reduction in elective PCIs, set against a 4% increase in emergent or urgent
procedures. Despite this, we grew U.S. Angiomax volume and year on year,
net sales worldwide are up 19%. Angiox and Cleviprex are beginning to make
meaningful contributions to our top line. Our development programs are
making progress."
Recent operational highlights:
-- HORIZONS-AMI one-year trial results were published in The Lancet. The
trial showed that Angiomax reduced cardiac-related death by 43 percent (p
equals 0.005), improved overall survival by 27 percent (p equals 0.037) and
reduced major bleeding complications by 39 percent (p is less than 0.0001)
compared with heparin plus a GP IIb/IIIa inhibitor. Angiomax showed an
absolute reduction of 1.7 percent in cardiac-related death and 1.3 percent
in all-cause death at one year.
-- The United States Patent and Trademark Office issued 2 new patents
relating to a more consistent and improved Angiomax drug product, which
were listed in the U.S. Food and Drug Administration's publication
"Approved Drug Products with Therapeutic Equivalence Evaluations," which is
commonly known as the Orange Book, for Angiomax.
-- The Company entered into a license agreement with Eagle
Pharmaceuticals, Inc. under which The Medicines Company will have rights in
the United States and Canada to an innovative, ready-to-use formulation of
Argatroban, which is currently under review by the U.S. Food and Drug
Administration (FDA).
-- The Committee for Medicinal Products for Human Use (CHMP) granted a
positive opinion applicable to all Member States of the European
Union/European Economic Area that will extend the use of Angiox to include
patients with heart attacks (so-called ST segment elevation myocardial
infarction (STEMI)) undergoing emergency heart procedures called primary
percutaneous coronary intervention (PCI).
Financial highlights for the first nine months of 2009:
-- Net revenue increased by 19% to $302.2 million for the first nine
months of 2009 from $254.3 million for the same period in 2008.
-- Angiomax U.S. sales increased by 16% to $286.6 million for the
first nine months of 2009 from $246.3 million for the first nine
months of 2008.
-- Angiomax/Angiox international net revenue in the first nine months
of 2009 increased by 64% to $13.1 million compared to $8.0 million
in the first nine months of 2008.
-- Cleviprex net revenue in the first nine months of 2009 was
$2.5 million.
-- Net loss for the first nine months of 2009 was ($2.7) million, or
($0.05) per share, and includes costs for the Targanta acquisition,
compared to net loss of ($4.3) million, or ($0.08) per share, in the
first nine months of 2008.
-- The Company reported non-GAAP net income of $20.9 million, or $0.40 per
share, for the first nine months of 2009, compared to non-GAAP net
income of $35.4 million, or $0.68 per share, for the first nine months
of 2008. Non-GAAP net income excludes the Targanta and Curacyte
acquisitions, stock-based compensation expense and non-cash income
taxes.
The following table provides reconciliations between GAAP and non-GAAP net
(loss) income for the third quarter (Q3) and first nine months (9M) of 2009
and 2008. Non-GAAP net income excludes the transaction charges related to
the Targanta and Curacyte acquisitions, stock-based compensation expense
and non-cash income taxes:
FAS 123R Non-Cash
Stock- (Benefit)
Reported Targanta Curacyte Based Provision
GAAP Net Trans- Acquisi- Compen- for Non-GAAP
(Loss) action tion sation Income Net
(in millions) Income Costs Costs Expense Taxes Income(1)
-------- --------- --------- --------- --------- ---------
Q3 2009 ($ 3.2) - - $ 4.4 $ 3.8 $ 5.1
-------- --------- --------- --------- --------- ---------
Q3 2008 ($ 13.2) - $ 13.2 $ 6.0 $ 2.5 $ 8.5
-------- --------- --------- --------- --------- ---------
9M 2009 ($ 2.7) $ 4.3 - $ 15.3 $ 4.0 $ 20.9
-------- --------- --------- --------- --------- ---------
9M 2008 ($ 4.3) - $ 13.2 $ 17.4 $ 9.1 $ 35.4
-------- --------- --------- --------- --------- ---------
Note: Amounts may not sum due to rounding.
(1) Excluding the transaction charges related to the Targanta and Curacyte
acquisitions, stock-based compensation expense and non-cash income taxes.
Reconciliations between GAAP and non-GAAP fully diluted (loss) earnings per
share (EPS) for the third quarter (Q3) and first nine months (9M) of 2009
and 2008 are provided in the following table:
FAS 123R Non-Cash
Reported Stock- (Benefit)
GAAP Targanta Curacyte Based Provision
(Loss) Trans- Acquisi- Compen- for
Earnings action tion sation Income Non-GAAP
(in millions) Per Share Costs Costs Expense Taxes EPS(1)
-------- --------- --------- --------- --------- ---------
Q3 2009 ($ 0.06) - - $ 0.09 $ 0.07 $ 0.10
-------- --------- --------- --------- --------- ---------
Q3 2008 ($ 0.25) - $ 0.25 $ 0.11 $ 0.05 $ 0.16
-------- --------- --------- --------- --------- ---------
9M 2009 ($ 0.05) $ 0.08 - $ 0.29 $ 0.08 $ 0.40
-------- --------- --------- --------- --------- ---------
9M 2008 ($ 0.08) - $ 0.25 $ 0.34 $ 0.18 $ 0.68
-------- --------- --------- --------- --------- ---------
Note: Amounts may not sum due to rounding.
(1) Excluding the transaction charges related to the Targanta and Curacyte
acquisitions, stock-based compensation expense and non-cash income taxes.
The Company believes that presenting the non-GAAP information contained in
the financial tables and in this press release assists investors and others
in gaining a better understanding of the Company's core operating results
and future prospects, expected growth rates or forecasted guidance,
particularly as related to transaction charges associated with the Targanta
acquisition, stock-based compensation expense and non-cash income taxes.
Management uses this non-GAAP information, in addition to the GAAP
information, as the basis for measuring the Company's core operating
performance and comparing such performance to that of prior periods and to
the performance of its competitors. Such measures are also used by
management in its financial and operating decision-making. Non-GAAP
information is not meant to be considered superior to or a substitute for
the Company's results of operations prepared in accordance with GAAP. A
reconciliation of GAAP results with non-GAAP results may also be found in
the attached financial tables.
2009 Guidance (in millions, except percentages and per share data)
The Medicines Company is changing guidance for fiscal year 2009 as follows:
April 28, 2009 July 29, 2009 October 28, 2009
Guidance Guidance Guidance
Changes(1) Changes(1)
---------------- ----------------- ----------------
Net Sales
US Angiomax $ 395-$ 405
International
Angiox $ 30-$ 40
Total Angiomax /
Angiox $ 425-$ 445 $ 425-$ 445
US Cleviprex $ 10-$ 19 $ 5-$ 10
Total Net Sales $ 435-$ 464 $ 430-$ 455 $ 395-$ 405(3)
Cost of Revenue 28%
R&D (GAAP) $ 97-$ 102 $ 102-$ 105
---------------- ----------------- ----------------
(w/o 123R) $ 93-$ 98 $ 98-$ 101
---------------- ----------------- ----------------
SG&A (GAAP) $ 194-$ 201
---------------- ----------------- ----------------
(w/o 123R) $ 178-$ 183
---------------- ----------------- ----------------
Stock Based Comp
-123R (2) $ 20-$ 22 $ 19-$ 20
Investment Income $ 3-$ 5 $ 2-$ 4
Effective Tax Rate 45%-50% 15%-25%(4)
Net Income (loss) -
GAAP $ 13-$ 18 ($ 13)-($ 10)
---------------- ----------------- ----------------
- Non GAAP $ 47-$ 59 $ 8-$ 13
---------------- ----------------- ----------------
EPS - GAAP $ 0.24-$ 0.34 ($ 0.25)-($ 0.19)
---------------- ----------------- ----------------
EPS - Non GAAP $ 0.88-$ 1.10 $ 0.14-$ 0.24
---------------- ----------------- ----------------
(1) Where no changes are indicated, previous guidance is reiterated.
(2) Note that GAAP reporting of R&D and SG&A include stock based
compensation expense
(3) Updated guidance is provided for combined sales globally only.
(4) Rate represents a benefit.
Non-GAAP net income (loss) and non-GAAP EPS each exclude expense from the
Targanta acquisition, compensation expense relating to SFAS 123R, and
non-cash tax provision.
There will be a conference call with management today at 8:30 a.m. Eastern
Time to discuss third quarter 2009 financial results and operational
developments. The conference call will be available via phone and webcast.
The webcast can be accessed at The Medicines Company website at
www.themedicinescompany.com.
The dial in information is listed below:
Domestic Dial In: 866-515-2915
International Dial In: 617-399-5129
Passcode for both dial in numbers: 71064969
Replay is available from 11:30 a.m. Eastern Time following the conference
call through November 4, 2009. To hear a replay of the call dial
888-286-8010 (domestic) and 617-801-6888 (international). Passcode for
both dial in numbers is 57422848.
About The Medicines Company
The Medicines Company (NASDAQ: MDCO) is focused on advancing the treatment
of critical care patients through the delivery of innovative,
cost-effective medicines to the worldwide hospital marketplace. The Company
markets Angiomax® (bivalirudin) in the United States and other countries
for use in patients undergoing coronary angioplasty, and Cleviprex®
(clevidipine butyrate) injectable emulsion in the United States for the
reduction of blood pressure when oral therapy is not feasible or not
desirable. The Company recently licensed rights in the United States and
Canada to an innovative formulation of Argatroban, which is currently under
regulatory review in the United States. The Company also has two products
in late stage development, cangrelor, an investigational antiplatelet agent
and oritavancin, a semi-synthetic lipoglycopeptide antibiotic. The
Company's pipeline also includes a serine protease inhibitor, CU2010, in
early-stage development. The Medicines Company's website is
www.themedicinescompany.com.
Statements contained in this press release about The Medicines Company that
are not purely historical, and all other statements that are not purely
historical, may be deemed to be forward-looking statements for purposes of
the safe harbor provisions under The Private Securities Litigation Reform
Act of 1995. Without limiting the foregoing, the words "believes,"
"anticipates" and "expects" and similar expressions are intended to
identify forward-looking statements. These forward-looking statements
involve known and unknown risks and uncertainties that may cause the
Company's actual results, levels of activity, performance or achievements
to be materially different from those expressed or implied by these
forward-looking statements. Important factors that may cause or contribute
to such differences include whether we receive regulatory approval for
additional indications, whether the Company's products will advance in the
clinical trials process on a timely basis or at all, whether clinical trial
results will warrant submission of applications for regulatory approval,
whether the Company will be able to obtain regulatory approvals, whether
physicians, patients and other key decision-makers will accept clinical
trial results, and such other factors as are set forth in the risk factors
detailed from time to time in the Company's periodic reports and
registration statements filed with the Securities and Exchange Commission
including, without limitation, the risk factors detailed in the Company's
Quarterly Report on Form 10-Q filed on August 10, 2009, which are
incorporated herein by reference. The Company specifically disclaims any
obligation to update these forward-looking statements.
The Medicines Company
Condensed Consolidated Statements of Operations
(unaudited)
(in thousands, except per share data) Three Months Ended September 30,
--------------------------------
2009 2008
--------------- ---------------
Net revenue $ 98,789 $ 88,126
Operating expenses:
Cost of revenue 28,308 22,089
Research and development 22,464 44,075
Selling, general and administrative 47,358 42,865
--------------- ---------------
Total operating expenses 98,130 109,029
--------------- ---------------
Income (loss) from operations 659 (20,903)
Other income 151 1,070
--------------- ---------------
Income (loss) before income taxes 810 (19,833)
(Provision) benefit for income taxes (4,007) 6,616
--------------- ---------------
Net (loss) income $ (3,197) $ (13,217)
=============== ===============
Basic (loss) per common share $ ( 0.06) $ (0.25)
=============== ===============
Shares used in computing basic (loss)
per common share 52,298 51,941
=============== ===============
Diluted (loss) per common share $ (0.06) $ (0.25)
=============== ===============
Shares used in computing diluted (loss)
per common share 52,298 51,941
=============== ===============
The Medicines Company
Condensed Consolidated Statements of Operations
(unaudited)
(in thousands, except per share data) Nine Months Ended September 30,
--------------------------------
2009 2008
--------------- ---------------
Net revenue $ 302,181 $ 254,285
Operating expenses:
Cost of revenue 86,958 63,121
Research and development 68,685 82,518
Selling, general and administrative 146,863 117,004
--------------- ---------------
Total operating expenses 302,506 262,643
--------------- ---------------
(Loss) from operations (325) (8,358)
Other income 2,055 5,256
--------------- ---------------
Income (loss) before income taxes 1,730 (3,102)
Provision for income taxes (4,465) (1,205)
--------------- ---------------
Net (loss) $ (2,735) $ (4,307)
Basic (loss) per common share $ (0.05) $ (0.08)
=============== ===============
Shares used in computing basic (loss)
per common share 52,225 51,842
=============== ===============
Diluted (loss) per common share $ (0.05) $ (0.08)
=============== ===============
Shares used in computing diluted (loss)
per common share 52,225 51,842
=============== ===============
The Medicines Company
Condensed Consolidated Balance Sheets
September 30, December 31,
(in thousands) 2009 2008
------------- -------------
ASSETS
Cash, cash equivalents and available for sales
securities $ 172,020 $ 216,206
Accrued interest receivable 868 1,336
Accounts receivable, net 44,717 33,657
Inventory 19,440 28,229
Prepaid expenses and other current assets 15,712 16,402
------------- -------------
Total current assets 252,757 295,830
------------- -------------
Fixed assets, net 26,210 27,331
Intangible assets, net 15,471 16,349
Restricted cash 7,169 5,000
Deferred tax assets 4,958 37,657
In process research & development 69,500 ---
Goodwill 26,035 ---
Other assets 7,325 5,237
------------- -------------
Total assets $ 409,425 $ 387,404
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $ 70,697 $ 83,608
Contingent purchase price 22,741 ---
Other long term liabilities 5,667 5,771
Stockholders' equity 310,320 298,025
------------- -------------
Total liabilities and stockholders' equity $ 409,425 $ 387,404
============= =============
The Medicines Company
Reconciliation of GAAP to non-GAAP Measures
(All amounts in thousands, except per share amounts)
(Unaudited)
Three Months Ended September 30, 2009
------------------------------------------------------------
Targanta Non-cash Non-GAAP(5)
GAAP(1) Acquisition SFAS 123R Tax Provision As Adjusted
-------- --------- -------- --------- --------
Net revenue $ 98,789 $ - $ - $ - $ 98,789
Operating
expenses:
Cost of
revenue 28,308 - (223) (3) - 28,085
Research
and
development 22,464 - (823) (3) - 21,641
Selling,
general
and
admini-
strative 47,358 - (2) (3,394) (3) - 43,964
-------- --------- -------- --------- --------
Total
operating
expenses 98,130 - (4,440) - 93,690
Income from
operations 659 - 4,440 - 5,099
Other income 151 - - - 151
-------- --------- -------- --------- --------
Income before
income taxes 810 - 4,440 - 5,250
(Provision)
benefit for
income taxes (4,007) - (2) - 3,829 (4) (178)
-------- --------- -------- --------- --------
Net income (3,197) - 4,440 3,829 5,072
Basic (loss)
earnings per
common share $ (0.06) $ - $ 0.09 $ 0.07 $ 0.10
======== ========= ======== ========= ========
Shares used
in computing
basic (loss)
earnings per
common share 52,298 52,298 52,298 52,298 52,298
======== ========= ======== ========= ========
Diluted
(loss)
earnings per
common share $ (0.06) $ - $ 0.09 $ 0.07 $ 0.10
======== ========= ======== ========= ========
Shares used
in computing
diluted
(loss)
earnings per
common share 52,298 52,298 52,298 52,298 52,298
======== ========= ======== ========= ========
(1) GAAP results
(2) Targanta aquisition
(3) Non-cash stock compensation expense
(4) Non-cash income taxes
(5) Non-GAAP results
The Medicines Company
Reconciliation of GAAP to non-GAAP Measures
(All amounts in thousands, except per share amounts)
(Unaudited)
Nine Months Ended September 30, 2009
------------------------------------------------------------
Targanta Non-Cash Non-GAAP(5)
GAAP(1) Acquisition SFAS 123R Tax Provision As Adjusted
-------- -------- -------- --------- --------
Net revenue $302,181 $ - $ - $ - $302,181
Operating
expenses:
Cost of
revenue 86,958 - (697) (3) - 86,261
Research
and
development 68,685 (2,762) (3) - 65,923
Selling,
general
and
admini-
strative 146,863 (4,281) (2) (11,888) (3) - 130,694
-------- -------- -------- --------- --------
Total
operating
expenses 302,506 (4,281) (15,347) - 282,878
(Loss) income
from
operations (325) 4,281 15,347 - 19,303
Other income 2,055 - - - 2,055
-------- -------- -------- --------- --------
Income before
income taxes 1,730 4,281 15,347 - 21,358
(Provision)
benefit for
income taxes (4,465) - (2) - 3,972 (4) (493)
-------- -------- -------- --------- --------
Net (loss)
income (2,735) 4,281 15,347 3,972 20,865
Basic (loss)
earnings per
common share $ (0.05) $ 0.08 $ 0.29 $ 0.08 $ 0.40
======== ======== ======== ========= ========
Shares used
in computing
basic (loss)
earnings per
common share 52,225 52,225 52,225 52,225 52,225
======== ======== ======== ========= ========
Diluted
(loss)
earnings per
common share $ (0.05) $ 0.08 $ 0.29 $ 0.08 $ 0.40
======== ======== ======== ========= ========
Shares used
in computing
diluted
(loss)
earnings per
common share 52,225 52,225 52,225 52,225 52,225
======== ======== ======== ========= ========
(1) GAAP results
(2) Targanta aquisition
(3) Non-cash stock compensation expense
(4) Non-cash income taxes
(5) Non-GAAP results