CAMBRIDGE, Mass., Feb. 7 /PRNewswire-FirstCall/ -- Biogen Idec Inc.
(Nasdaq: BIIB), the world's third largest biotech company with leading
products and capabilities in oncology and immunology, today reported its
fourth quarter and full year 2004 results.
(Logo: http://www.newscom.com/cgi-bin/prnh/20031112/LAW121LOGO )
Fourth Quarter & Full Year Highlights
* Total revenues in 2004 exceeded $2.20 billion vs. prior year $679
million (adjusted pro forma of $1.85 billion, an increase of 19%),
driven primarily by AVONEX(R) (Interferon beta-1a) sales up 21%
(adjusted pro forma non-GAAP) to $1.42 billion and RITUXAN(R)
(rituximab) co-promotion profits up 25% to $615 million.
* Fourth quarter revenues were $586 million vs. prior year $300 million
(adjusted pro forma non-GAAP of $491 million, an increase of 19%),
driven primarily by AVONEX sales up 19% (adjusted pro forma non-GAAP) to
$370 million and RITUXAN co-promotion profits up 31% to $170 million.
* On a reported basis, calculated in accordance with U.S. generally
accepted accounting principles (GAAP), full year earnings per share
(EPS) were $0.13; excluding merger-related accounting impacts and other
non-operating charges, adjusted pro forma non-GAAP EPS were $1.44.
Fourth quarter GAAP earnings per share (EPS) were $0.14; excluding
merger-related accounting impacts and other non-operating charges,
adjusted pro forma non-GAAP EPS were $0.34.
* In November, Biogen Idec and Elan Corporation, plc announced that the
U.S. Food and Drug Administration (FDA) approved TYSABRI(R)
(natalizumab), formerly referred to as ANTEGREN(R), as treatment for
relapsing forms of multiple sclerosis (MS) to reduce the frequency of
clinical relapses.
James Mullen, Biogen Idec's Chief Executive Officer, commented, "Biogen
Idec had a momentous year in 2004, highlighted by the approval of TYSABRI
based on one-year data. Our major R&D programs experienced their most
productive year and strong performance in AVONEX and RITUXAN fueled revenue
growth of 19% to $2.2 billion. This puts us on track to meet our long-term
goals of achieving approximately 15% top and 20% bottom line operating
performance."
Financial Performance
On an adjusted non-GAAP basis, Biogen Idec reported net income of $121
million in the fourth quarter of 2004 (Q4 2003 adjusted pro forma non-GAAP:
$91 million) and $518 million for the full year 2004 (2003 adjusted pro forma
non-GAAP: $432 million). Adjusted non-GAAP EPS was $0.34 for the fourth
quarter of 2004 (Q4 2003 adjusted pro forma non-GAAP: $0.25) and $1.44 for the
full year 2004 (2003 adjusted pro forma non-GAAP: $1.22).
These adjustments are itemized on the attached reconciliation tables.
Adjusted non-GAAP EPS and net income for the fourth quarter and full year of
2004 exclude merger-related accounting impacts, such as amortization of
intangibles, impairment of intangibles, inventory step up, and other merger-
related charges, and other non-operating charges. Adjusted pro forma non-GAAP
EPS and net income for the fourth quarter and full year of 2003 include
revenue and expenses from the former Biogen, Inc. from January 1 to November
12, 2003 (date of merger) but excludes similar merger-related accounting
impacts excluded from fourth quarter and full year 2004 adjusted non-GAAP EPS
and other non-operating charges of the former Biogen, Inc. and IDEC
Pharmaceuticals Corporation.
On a reported basis, calculated in accordance with GAAP, Biogen Idec
reported net income of $48 million (or EPS of $0.14) in the fourth quarter of
2004 and net income of $45 million (or EPS of $0.13) for the full year 2004.
The difference between adjusted non-GAAP net income and EPS and GAAP net
income and EPS in the fourth quarter and full year were primarily due to non-
cash merger-related accounting impacts of $88 million and $656 million,
respectively. Full year 2004 was also impacted by a $13 million write-down of
certain investments.
Revenue Performance
Revenues from AVONEX, Biogen Idec's therapy for patients with relapsing
forms of MS, increased 19% in the fourth quarter to $370 million (Q4 2003
adjusted pro forma non-GAAP: $310 million). Full year AVONEX sales increased
21% to $1.42 billion (2003 adjusted pro forma non-GAAP: $1.17 billion). In
2004, U.S. sales were $922 million and international sales were $495 million.
Revenues from AMEVIVE(R) (alefacept), Biogen Idec's treatment for
moderate-to-severe chronic plaque psoriasis, were $10 million in the fourth
quarter (Q4 2003 adjusted pro forma non-GAAP: $17 million) and $43 million for
the full year (2003 adjusted pro forma non-GAAP: $40 million).
Revenues from ZEVALIN(R) (ibritumomab tiuxetan), Biogen Idec's
radioimmunotherapeutic agent for relapsed or refractory low-grade, follicular
or transformed B-cell non-Hodgkin's lymphoma (NHL), were $8 million in the
fourth quarter of 2004 (Q4 2003: $5 million) and $23 million for the full year
(2003: $20 million).
Revenues from TYSABRI, Biogen Idec's therapy for patients with relapsing
forms of MS, were $3 million in the fourth quarter.
Revenues for the fourth quarter of 2004 and full year 2004 included $170
million (Q4 2003: $130 million) and $615 million (2003: $493 million),
respectively, from Biogen Idec's joint business arrangement with Genentech,
Inc. related to RITUXAN, a treatment for certain B-cell non-Hodgkin's
lymphomas that Biogen Idec co-promotes in the U.S. with Genentech. All U.S.
sales of RITUXAN are recognized by Genentech, and Biogen Idec records its
share of the pretax co-promotion profits on a quarterly basis. U.S. net sales
of RITUXAN were $429 million in the fourth quarter (Q4 2003: $369 million) and
$1.57 billion for the full year (2003: $1.36 billion), as reported by
Genentech.
Royalties were $25 million in the fourth quarter (Q4 2003 adjusted pro
forma non-GAAP: $27 million) and $98 million for the full year (2003 adjusted
pro forma non-GAAP: $127 million).
Financial Guidance
Biogen Idec today reaffirmed its long-term goal of achieving 15% compound
annual revenue growth, and approximately 20% compound annual earnings per
share (adjusted pro forma non-GAAP) growth through 2007.
Given the launch investments behind TYSABRI, the Company is anticipating
low double-digit growth for revenue and adjusted non-GAAP earnings in 2005.
On this non-GAAP basis, the Company expects operating expenses to grow 12-14%
over 2004 levels and its effective tax rate for 2005 to be in the range of 31-
33%. As a result, the Company estimates that its 2005 non-GAAP earnings per
share will be in the range of $1.60 to the low $1.70's.
The Company anticipates that 2005 capital expenditures will be in the
range of $400 - $475 million. A significant portion of these expenditures
will be directed towards the completion of the Oceanside manufacturing
facility and the construction of a large-scale manufacturing facility in
Denmark.
Fourth Quarter 2004 Highlights
* On December 21, 2004, Biogen Idec and Elan announced the initiation of a
head-to-head study comparing the safety and efficacy of TYSABRI to
Rebif(R) (Interferon beta-1a). STARS (Study of TYSABRI Against Rebif in
relapsing multiple sclerosis), is a randomized, assessor-blinded,
parallel group study that will enroll more than 1,000 MS patients in
North and South America, Europe, Australia, Turkey and Israel. Rebif is
a registered trademark of Serono S.A.
* On November 23, 2004, Biogen Idec and Elan announced that the FDA
approved TYSABRI as treatment for relapsing forms of MS to reduce the
frequency of clinical relapses. FDA granted accelerated approval for
TYSABRI following priority review based on one-year data from two Phase
III studies, the AFFIRM monotherapy trial and the SENTINEL add-on trial
with AVONEX.
* On November 1, 2004, Biogen Idec, Genentech and Roche announced that
DANCER, a Phase IIb clinical study of RITUXAN in patients with
moderate-to-severe rheumatoid arthritis who were also treated with
methotrexate, met its primary endpoint. A significantly greater
proportion of RITUXAN plus methotrexate-treated patients achieved an
American College of Rheumatology (ACR) 20 response at week 24, compared
to placebo.
* Biogen Idec announced on October 13, 2004, that Health Canada has
authorized AMEVIVE for sale in Canada. AMEVIVE, the first biologic
approved for psoriasis in Canada, will be marketed for the treatment of
patients with moderate-to-severe chronic plaque psoriasis who are
candidates for systemic therapy or phototherapy.
* On October 6, 2004, ImmunoGen, Inc. and Biogen Idec announced that
Biogen Idec licensed exclusive rights to develop and commercialize
anti-cancer therapeutics that comprise an antibody developed by Biogen
Idec to an undisclosed tumor cell target and ImmunoGen's proprietary
Tumor-Activated Prodrug (TAP) technology.
Conference Call and Webcast
The Company's earnings conference call for the fourth quarter will be
broadcast via the internet at 5:00 p.m. ET on February, 7, 2005, and will be
accessible through the investor relations section of Biogen Idec's homepage,
http://www.biogenidec.com.
About Biogen Idec
Biogen Idec creates new standards of care in oncology and immunology. As a
global leader in the development, manufacturing, and commercialization of
novel therapies, Biogen Idec transforms scientific discoveries into advances
in human healthcare. For product labeling, press releases and additional
information about the company, please visit http://www.biogenidec.com.
Safe Harbor
This press release contains forward-looking statements regarding expected
future financial results and plans for our development programs, including
TYSABRI.
These statements are based on the Company's current beliefs and
expectations. A number of risks and uncertainties could cause actual results
to differ materially. For example, financial results, including future
revenue and EPS growth, anticipated levels of expenses, other statements
regarding future financial performance, and overall prospects for the
Company's products may be affected by a number of factors, including the
degree and timing of market acceptance of TYSABRI, any unexpected slowing of
growth of the markets for AVONEX and RITUXAN, any change in market acceptance
of these products in key markets worldwide, the impact of reimbursement and
pricing decisions related to the Company's products, particularly TYSABRI, the
impact of competitive products on the Company's products, any material
decreases in sales by licensees of products on which the Company receives
royalties, the impact of litigation, the impact of costs related to the launch
of TYSABRI, any unanticipated increase in expenses related to in-licensing and
product opportunities, increases in costs related to development of new
products and existing products in new indications, and any material issues,
delays or failures related to the manufacturing or supply of the Company's
products.
Drug development and commercialization involve a high degree of risk. For
example, our development and commercialization of TYSABRI as a treatment for
MS could be negatively affected if unexpected concerns arise from additional
data, including the two-year data from the Phase 3 trial, once unblinded, or
if we were to encounter other unexpected hurdles.
For more detailed information on the risks and uncertainties associated
with these forward looking statements and the Company's other activities see
the periodic reports filed by the Company with the Securities and Exchange
Commission. The Company does not undertake any obligation to publicly update
any forward-looking statements, whether as a result of new information, future
events, or otherwise.
Media Contact:
Jose Juves
Associate Director, Public Affairs
Biogen Idec
Tel: (617) 914-6524
Investment Community Contact:
Elizabeth Woo
Senior Director, Investor Relations
Biogen Idec
Tel: (617) 679-2812
TABLE 1
Financial Results For The Fourth Quarter and Full Year of 2004
Condensed Consolidated Statements Of Income - GAAP Basis
(in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
2004 2003 2004 2003
REVENUES
Product $390,929 $156,492 $1,486,344 $171,561
Revenue from unconsolidated
joint business 169,972 129,813 614,591 493,049
Royalties 24,910 12,010 98,281 12,010
Corporate partner 153 1,531 10,530 2,563
Total Revenues 585,964 299,846 2,209,746 679,183
COST AND EXPENSES
Cost of product and royalty
revenues 66,586 279,457 537,541 284,739
Research and development 188,504 111,954 686,722 233,337
Selling, general and
administrative 174,340 99,614 576,228 174,596
Acquisition of in-process
research and development - 823,000 - 823,000
Amortization of acquired
intangible assets 80,455 33,180 347,677 33,180
Total Cost and Expenses 509,885 1,347,205 2,148,168 1,548,852
Income (loss) from Operations 76,079 (1,047,359) 61,578 (869,669)
Other income (expense), net 14,947 (19,504) 31,513 (10,955)
INCOME (LOSS) BEFORE INCOME
TAXES 91,026 (1,066,863) 93,091 (880,624)
Income taxes (benefit) 42,672 (76,296) 48,340 (5,527)
NET INCOME (LOSS) $48,354 $(990,567) $44,751 $(875,097)
BASIC EARNINGS (LOSS) PER
SHARE $0.14 $(4.03) $0.13 $(4.92)
DILUTED EARNINGS (LOSS) PER
SHARE $0.14 $(4.03) $0.13 $(4.92)
SHARES USED IN CALCULATING:
BASIC EARNINGS (LOSS) PER
SHARE 334,491 245,831 334,996 177,982
DILUTED EARNINGS (LOSS) PER
SHARE 362,098 245,831 343,475 177,982
TABLE 2
Condensed Consolidated Balance Sheets
(dollars in thousands)
Dec. 31, 2004 Dec. 31, 2003
Assets:
Current assets
Cash, cash equivalents and
securities available-for-sale $536,667 $835,959
Accounts receivable, net 277,973 198,524
Inventory 270,528 496,349
Other current assets 383,528 307,832
Total current assets 1,468,696 1,838,664
Long-term securities available-
for-sale 1,630,899 1,502,327
Property and equipment, net 1,523,207 1,252,783
Intangible assets, net 3,292,827 3,638,812
Goodwill 1,151,105 1,151,066
Other 172,104 120,293
Total assets $9,238,838 $9,503,945
Liabilities and shareholders'
equity
Current liabilities $514,552 $404,825
Long-term deferred tax liability 977,560 1,108,318
Non-current liabilities 904,281 937,474
Shareholders' equity 6,842,445 7,053,328
Total liabilities and
shareholders' equity $9,238,838 $9,503,945
TABLE 3
Financial Results For The Fourth Quarter and Full Year 2004
Condensed Consolidated Statements Of Income -- Operating Basis
(in millions, except per share amounts)
The non-GAAP financial measures presented below are utilized by Biogen
Idec management to gain an understanding of the comparative financial
performance of the Company. Management believes that the non-GAAP
financial measures are useful because they exclude those non-operational
activities or transactions that are not necessarily relevant to
understanding the trends of the Company or the prospects of future
performance. The presentation of this information is not meant to be
considered in isolation or as a substitute for GAAP financial measures.
Numbers may not foot due to rounding.
Three Months Twelve Months
Ended Ended
December 31, December 31,
2004 2003 2004 2003
REVENUES
Product $390.9 $332.0 $1,486.3 $1,228.5
Revenue from unconsolidated joint
business 170.0 129.8 614.6 493.0
Royalties 24.9 26.8 98.3 127.2
Corporate partner 0.2 2.5 10.5 3.6
Total Revenues 586.0 491.1 2,209.7 1,852.4
COST AND EXPENSES
Cost of product and royalty revenues 62.2 79.1 242.0 230.5
Research and development 188.4 159.7 683.7 534.4
Selling, general and administrative 171.8 136.7 566.9 508.1
Total Cost and Expenses 422.4 375.5 1,492.6 1,273.0
Income from Operations 163.6 115.6 717.1 579.4
Other income, net 14.9 16.0 44.2 52.6
INCOME BEFORE INCOME TAXES 178.6 131.6 761.4 632.0
Income taxes 57.2 40.2 243.6 200.4
NET INCOME $121.4 $91.4 $517.7 $431.7
Numerator:
Net Income $121.4 $91.4 $517.7 $431.7
Net Income allocable
to participating
securities (I) (0.2) (0.6) (0.8) (2.8)
Net Income used in
calculating basic eps $121.2 $90.8 $517.0 $428.8
Net adjustment for
interest expense 2.3 0.4 9.1 9.4
Net income used in
calculating diluted
eps $123.5 $91.2 $526.1 $438.2
Shares used in calculation of
earnings per share:
Denominator
Weighted average
number of common
shares outstanding 334.5 328.1 335.0 327.3
Effect of dilutive
securities: stock
options, convertible
preferred stock,
convertible
promissory notes 27.6 30.2 30.4 30.4
Dilutive potential
common shares 362.1 358.3 365.4 357.8
Earnings per share:
Basic $0.36 $0.28 $1.54 $1.31
Diluted $0.34 $0.25 $1.44 $1.22
An itemized reconciliation between
net income on a GAAP basis is as
follows:
GAAP Net Income/(loss) $48.4 ($990.6) $44.8 ($875.1)
Pre-merger Biogen, Inc. Product
Revenue - 175.5 - 1,056.9
Pre-merger Biogen, Inc. Royalty
Revenue - 14.8 - 115.2
Pre-merger Biogen, Inc. Corporate
Partner Revenue - 1.0 - 1.0
Fair value step up of inventory
acquired from former Biogen, Inc. 4.4 231.6 295.5 231.6
Pre-merger Biogen, Inc. Cost of Sales - (33.0) - (179.2)
Royalites related to Corixa
Settlement - 1.8 - 1.8
Pre-merger Biogen, Inc. R&D, net of
intercompany transactions - (47.7) - (301.1)
Pre-merger Biogen, Inc. SG&A - (50.4) - (346.7)
Merger related costs (severance and
consulting) 2.6 13.3 12.4 13.2
Amortization of acquired intangible
assets related
to the merger with former
Biogen, Inc. 80.5 33.2 347.7 33.2
Acquisition of in-process research
and development - 823.0 - 823.0
Pre-merger Biogen, Inc. Other income - 4.8 - 32.9
Represents write down of certain
investments - - 12.7 -
Charges associated with Charitable
Donations and Legal Settlements - 30.7 - 30.7
Income tax effect of reconciling
items (14.5) (116.5) (195.3) (205.8)
Non-GAAP Net Income $121.4 $91.4 $517.7 $431.7
Adjustments were made to conform prior periods to current year
presentation including adoption of EITF 03-06, which requires allocation
of income to certain holders of equity and debt instruments and the
immaterial correction of a non-GAAP elimination of intercompany activities
between legacy pre-merger companies.
Table 4
Biogen Idec Inc
Product Revenues for Fourth Quarter and Full Year 2004
(in thousands)
The non-GAAP pro forma financial measures presented below are utilized by
Biogen Idec management to gain an understanding of the comparative revenue
performance of the Company. Management believes that the non-GAAP
financial measures are useful because they include those non-GAAP
activities or transactions that may be relevant to obtaining an
understanding of the trends of the Company or the prospects of future
performance.
Three Months Ended
December 31,
2004 2003
Biogen Pro Forma
U.S. GAAP U.S. GAAP Revenue Combined
Revenue Revenue Pre-merger(a) Revenue
PRODUCT REVENUES
Avonex(R) $369,675 $142,603 $167,513 $310,116
Amevive(R) 9,705 9,356 7,984 17,340
Tysabri(R) 3,121 - - -
Zevalin(R) 8,427 4,533 - 4,533
Total Product Revenues $390,929 $156,492 $175,497 $331,989
(a) Represents former Biogen, Inc. revenue that is not included in GAAP
revenues.
Twelve Months Ended
December 31,
2004 2003
Biogen Pro Forma
U.S. GAAP U.S. GAAP Revenue Combined
Revenue Revenue Pre-merger(a) Revenue
PRODUCT REVENUES
Avonex(R) $1,417,157 $142,603 $1,025,874 $1,168,477
Amevive(R) 43,030 9,356 31,058 40,414
Tysabri(R) 3,121 - - -
Zevalin(R) 23,036 19,602 - 19,602
Total Product Revenues $1,486,344 $171,561 $1,056,932 $1,228,493
SOURCE Biogen Idec Inc.
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CONTACT:
Jose Juves, Associate Director, Public
Affairs, +1-617-914-6524, or Elizabeth Woo, Senior Director,
Investor Relations, +1-617-679-2812, both of Biogen Idec
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