Reported Earnings Per Share of $0.42; Operating Earnings Per Share of $0.50
Record Quarter of Worldwide AVONEX(R) (Interferon beta-1a) Revenues
AMEVIVE(R) (alefacept) Launched in February
CAMBRIDGE, Mass., April 17 /PRNewswire-FirstCall/ --
Biogen, Inc. (Nasdaq: BGEN) today announced financial results for the first
quarter of 2003.
(Photo: http://www.newscom.com/cgi-bin/prnh/19990824/BIOLOGO )
For the three months ended March 31, 2003, total revenues were $321
million, an increase of 11 percent over the first quarter of 2002.
* AVONEX worldwide sales were $274 million, an increase of three percent
over first quarter 2002. U.S. sales were $189 million, and
international sales were $85 million.
* AMEVIVE sales were $4 million for the period from the launch of AMEVIVE
on February 1 through March 31.
* Royalties were $41 million, an increase of 85 percent over the first
quarter 2002, primarily driven by resumption of royalties on U.S. sales
of alpha interferon products by Schering-Plough.
Reported net income in the first quarter of 2003 was $64 million, or $0.42
per share. In the first quarter of 2002, reported net income was $72 million,
or $0.47 per share.
Operating results in the first quarter of 2003 exclude charges of $16
million to other income (expense) related to a legal settlement with Dr.
Rentschler Biotechnologie GmbH related to an intellectual property dispute and
a write-down of certain investments. On an after-tax basis, these charges
were $12 million, or $0.08 per share. Operating earnings per share was $0.50
in the first quarter of 2003 versus $0.48 in the same period of 2002. See
attached "Operating Condensed Consolidated Statements of Income" table for a
reconciliation of reported results (GAAP) to operating results (Non-GAAP).
Jim Mullen, Biogen's Chairman and Chief Executive Officer, noted, "The
strength of these results are driven by robust revenue performance of AVONEX
worldwide and operational efficiencies across the company. In addition, the
AMEVIVE launch has gone well and we expect AMEVIVE to become an important
product. Later this summer, we, along with our partner, Elan, expect to
announce Phase 3 results for ANTEGREN(R) (natalizumab) in Crohn's disease.
These accomplishments put us on track to achieve our goals for this year."
Neurology Franchise
In January, the U.S. Food and Drug Administration (FDA) approved the use
of AVONEX to treat patients who have experienced their first Multiple
Sclerosis (MS) attack if brain scans show abnormalities characteristic of MS.
At the recent 55th annual meeting of the American Academy of Neurology,
Dr. Richard Rudick of The Cleveland Clinic Foundation presented a poster on
the study designs of two Phase 3 trials of ANTEGREN alone and in combination
with AVONEX in patients with relapsing-remitting MS. These two Phase 3 trials
became fully enrolled in the fourth quarter of 2002 and, combined, have
enrolled more than 2,100 patients.
Dermatology Franchise
The FDA approved AMEVIVE at the end of January for the treatment of adult
patients with moderate-to-severe chronic plaque psoriasis who are candidates
for systemic therapy or phototherapy. As of mid-April, almost 800 physicians
are pursuing AMEVIVE therapy for more than 2,500 patients, most of whom are
awaiting insurance verification. More than 90 percent of patients who have
completed the insurance verification process have received coverage for
AMEVIVE.
Other Notable Accomplishments
At the end of January, Biogen and IDEC Pharmaceuticals Corporation
announced plans to collaborate on the development of three oncology
therapeutics from Biogen's pipeline of early-stage development candidates.
The collaboration leverages the companies' world-class capabilities in their
respective areas of discovery research, development, and manufacturing. By
working together, the companies expect these promising new therapeutics for
patients with cancer to move forward more rapidly.
2003 FINANCIAL GUIDANCE
For the second quarter of 2003, the Company expects diluted operating
earnings per share to be in the range of $0.38 - $0.44.
The Company reiterated that it expects its full year 2003 operating
earnings per share to be in the range of $1.72 - $1.85 announced on April 2,
2003. Specifics are provided in the attached table. Guidance for full year
2003 and second quarter reported earnings per share, which is the most
comparable GAAP-based financial measure to operating earnings per share, is
not currently accessible as the Company cannot predict with any certainty the
nature or the amount of non-operating or unusual charges for subsequent
quarters. The Company does, however, anticipate that it may have to take such
charges in subsequent quarters and that such charges, if material, would cause
reported earnings per share to differ from operating earnings per share.
CONFERENCE CALL AND WEBCAST
The Company's earnings conference call for the first quarter will be
broadcast via the Internet at 8:30 a.m. ET on April 17, 2003, and will be
accessible through the investor relations section of Biogen's homepage,
http://www.biogen.com.
INVESTOR CALENDAR
Second quarter results Thursday, July 24, 2003, 8:30 a.m. ET
ABOUT BIOGEN
Biogen is the world's oldest independent biotechnology company and a
leader in biologics research, development and manufacturing. A pioneer in
leading edge research in immunology, neurobiology and oncology, Biogen brings
novel therapies to improve patients' lives around the world through its global
marketing capabilities. For press releases and additional information about
the company, please visit http://www.biogen.com.
ABOUT AVONEX
The most common side effects associated with AVONEX treatment are flu-like
symptoms including myalgia, fever, fatigue, headache, chills, nausea,
vomiting, pain and asthenia.
AVONEX should be used in caution with patients with depression or other
mood disorders and in patients with seizure disorders. AVONEX should not be
used by pregnant women. Patients with cardiac disease should be closely
monitored. Patients should also be monitored for signs of hepatic injury.
Routine periodic blood chemistry and hematology tests are recommended during
treatment with AVONEX. Rare cases of anaphylaxis have been reported.
FORWARD LOOKING STATEMENTS / SAFE HARBOR
This press release contains forward-looking statements regarding expected
future financial results and expectations related to the development of the
Company's pipeline products.
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
revenues, revenue growth, earnings per share, expenses, income tax rate and
capital expenditures, may be affected by any slowing of growth of the multiple
sclerosis market, any change in market acceptance of AVONEX in key markets
worldwide, the Company's ability to achieve market acceptance of AMEVIVE and
to successfully launch AMEVIVE in the U.S., the impact of reimbursement and
pricing decisions related to the Company's products, the impact of competitive
products on AVONEX and AMEVIVE sales, the impact of litigation, any
unanticipated increase in expenses including in the areas of research and
development and sales and marketing, and in-licensing and product
opportunities. The Company's expectations regarding the development of its
pipeline products, including the timing of anticipated results from our
clinical trials of ANTEGREN in Crohn's disease and expectations regarding the
collaboration with IDEC Pharmaceuticals, are subject to the risks inherent in
drug development, including the risk of unexpected new data or information,
unexpected technical or manufacturing issues and intellectual property
disputes. Drug development involves a high degree of risk. Only a small
number of research and development programs result in the commercialization of
a product. Success in early stage clinical trials does not ensure that later
stage or larger scale clinical trials will be successful.
For more detailed information on the risks and uncertainties associated
with these forward looking statements and the Company's other activities see
the Outlook section in MD&A of the Company's Annual Report on Form 10-K and
quarterly reports on Form 10-Q filed with the Securities and Exchange
Commission. The Company does not undertake any obligation to publicly update
any forward-looking statements.
Media Contact:
Tim Hunt
Director, Public Affairs
Biogen, Inc.
Tel: (617) 914-6524
Investment Community Contact:
Elizabeth Woo
Senior Director, Investor Relations
Biogen, Inc.
Tel: (617) 679-2812
Financial Results For The First Quarter of 2003
Condensed Consolidated Statements Of Income
(in thousands, except per share amounts)
Three Months Ended
March 31,
2003 2002
REVENUES
Product $278,177 $265,985
Royalties 41,373 22,358
Contract 1,149 -
Total Revenues 320,699 288,343
COST AND EXPENSES
Cost of product and royalty revenues 46,266 39,318
Research and development 85,106 82,467
Selling, general and administrative 95,423 73,390
Total Cost and Expenses 226,795 195,175
Income from Operations 93,904 93,168
Other income (expense), net (5,664) 7,028
INCOME BEFORE INCOME TAXES 88,240 100,196
Income Taxes 24,707 28,055
NET INCOME $63,533 $72,141
BASIC EARNINGS PER SHARE $0.42 $0.49
DILUTED EARNINGS PER SHARE $0.42 $0.47
SHARES USED IN CALCULATING:
BASIC EARNINGS PER SHARE 149,611 148,660
DILUTED EARNINGS PER SHARE 151,494 152,202
Financial Results for The First Quarter of 2003
Operating Condensed Consolidated Statements Of Income
(in thousands, except per share amounts)
The non-GAAP financial measure presented below is utilized by Biogen
management to gain an understanding of the comparative operating performance
of the Company. This non-GAAP financial measure may be useful in excluding
those non-operational or unusual activities or transactions that are not
necessarily relevant to obtaining an understanding of the trends of the
Company or the prospects of future performance.
Three Months Ended Full Year Ended
March 31,
2003 (a) 2002 (b)
Operating Operating
Reported Adjust- Results Reported Adjust- Results
ments ments
REVENUES
Product $278,177 $278,177 $265,985 $265,985
Royalties 41,373 41,373 22,358 22,358
Contract 1,149 1,149 - -
Total Revenues 320,699 - 320,699 288,343 - 288,343
COST AND EXPENSES
Cost of product
and royalty
revenues 46,266 46,266 39,318 39,318
Research and
development 85,106 85,106 82,467 82,467
Selling, general and
administrative 95,423 95,423 73,390 73,390
Total Cost and
Expenses 226,795 - 226,795 195,175 - 195,175
Income from
Operations 93,904 - 93,904 93,168 - 93,168
Other income
(expense), net (5,664) 15,989 10,325 7,028 2,182 9,210
INCOME BEFORE
INCOME TAXES 88,240 15,989 104,229 100,196 2,182 102,378
Income Taxes 24,707 4,477 29,184 28,055 611 28,666
NET INCOME $63,533 $11,512 $75,045 $72,141 $ 1,571 $73,712
BASIC EARNINGS
PER SHARE $0.42 $0.08 $0.50 $0.49 $0.01 $0.50
DILUTED EARNINGS
PER SHARE $0.42 $0.08 $0.50 $0.47 $0.01 $0.48
SHARES USED IN CALCULATING:
BASIC EARNINGS
PER SHARE 149,611 149,611 149,611 148,660 148,660 148,660
DILUTED EARNINGS
PER SHARE 151,494 151,494 151,494 152,202 152,202 152,202
(a) Non-operational adjustments for the first quarter of 2003 include
charges of $12.9 million related to the settlement of litigation and
$3.1 million for the write-down of certain investments.
(b) Non-operational adjustments for the first quarter of 2002 includes a
$2.2 million charge related to the write-down of certain non-current
marketable securities.
Condensed Consolidated Balance Sheets
(in thousands)
Mar. 31, 2003 Dec. 31, 2002
ASSETS
Current Assets
Cash and marketable securities $812,381 $867,109
Accounts receivable, net 177,966 171,067
Other current assets 190,129 177,848
Total current assets 1,180,476 1,216,024
Property and equipment, net 749,183 738,059
Other assets 46,230 52,905
$1,975,889 $2,006,988
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $271,010 $326,333
Long term debt & liabilities 86,200 85,234
Shareholders' equity 1,618,679 1,595,421
$1,975,889 $2,006,988
2003 Guidance for Biogen, Inc.
April 17, 2003
2003 Guidance
REVENUES
Product
AVONEX 3 - 6% growth
US 0 - 2% growth
Rest of World 12 - 16% growth
AMEVIVE Over $85 MM
Royalties $ 145 -160 MM
Total Revenues Mid-teen growth
COSTS, EXPENSES, & TAX RATE as % of Total Revenues
Cost of Sales 14 - 15 %
Research and development 30 - 32 %
Selling, general and administrative 28 - 30 %
Other income and expense $35 - 45 MM
Tax rate Approximately 28 %
DILUTED OPERATING EARNINGS PER SHARE $1.72 - 1.85
DILUTED SHARES OUTSTANDING 151 - 153 MM
CAPITAL EXPENDITURES $ 150 - 175 MM
This financial guidance, which is provided as part of a press release
dated April 17, 2003, is based on the Company's expectations and is subject to
all of the qualifications and limitations described in the press release.
Actual results may differ from these forward-looking statements. See the safe
harbor statement for more information.
SOURCE Biogen, Inc.
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NewsCom:
http://www.newscom.com/cgi-bin/prnh/19990824/BIOLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, 888-776-6555 or 212-782-2840
CONTACT:
Tim Hunt, Director, Public Affairs,
+1-617-914-6524, or Elizabeth Woo, Senior Director, Investor
Relations, +1-617-679-2812 both of Biogen, Inc.
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