- Net Product Sales $2.97B in Q3:16; Increased
28% Y/Y
- 2016 Guidance and 2017 Targets Updated
- Over 150 Abstracts Expected at Medical
Congresses in Q4
- FDA Grants Priority Review for REVLIMID® as
Maintenance Treatment Post-Autologous Stem-Cell Transplant in
Multiple Myeloma
Celgene Corporation (NASDAQ:CELG) reported net product sales of
$2,969 million for the third quarter of 2016, a 28 percent increase
from the same period in 2015. Net product sales growth includes a 1
percent negative impact from currency exchange effects. Third
quarter total revenue increased 28 percent to $2,983 million
compared to $2,334 million in the third quarter of 2015.
Net income for the third quarter of 2016 based on U.S. GAAP
(Generally Accepted Accounting Principles), was $171 million or
$0.21 per diluted share compared to a net loss of $34 million or
$0.04 per diluted share in the third quarter of 2015. The results
for the third quarter of 2016 include increased research and
development expenses as a result of the EngMab AG acquisition. The
net loss in the third quarter of 2015 reflected costs related to
strategic transactions including the collaboration with Juno
Therapeutics and the acquisition of Receptos.
Adjusted net income for the third quarter of 2016 was $1,263
million or $1.58 per diluted share compared to $1,011 million or
$1.23 per diluted share for the third quarter of 2015.
“Continued outstanding execution by our teams around the world
led to another strong quarter of revenue growth and progress
advancing many of our most important strategic programs,” said Mark
J. Alles, Chief Executive Officer of Celgene Corporation. “Our
increasing enterprise-wide momentum has us on-track to exceed key
2016 objectives and positions us well for sustained long-term
growth.”
Third Quarter 2016 Financial
Highlights
Unless otherwise stated, all comparisons are for the third
quarter of 2016 compared to the third quarter of 2015. The adjusted
operating expense categories presented below exclude share-based
employee compensation expense, collaboration-related upfront
expense, research and development asset acquisition expense and a
litigation-related loss contingency accrual expense. Please see the
attached Use of Non-GAAP Financial Measures and Reconciliation of
GAAP to Adjusted Net Income for further information relevant to the
interpretation of adjusted financial measures and reconciliations
of these adjusted financial measures to the most comparable GAAP
measures, respectively.
Net Product Sales Performance
- REVLIMID® sales for the third quarter
increased 30 percent year-over-year to $1,891 million and were
driven by new patient market share gains and increased duration.
U.S. sales of $1,153 million and international sales of $738
million increased 29 percent and 32 percent year-over-year,
respectively.
- POMALYST®/IMNOVID® sales for the third
quarter were $341 million, an increase of 33 percent
year-over-year. U.S. sales were $203 million and international
sales were $138 million, an increase of 35 percent and 30 percent
year-over-year, respectively. POMALYST®/IMNOVID® sales grew due to
increased volume from duration gains.
- OTEZLA® sales for the third quarter
were $275 million, a 98 percent increase year-over-year. U.S. sales
were $245 million and international sales were $30 million. Sales
were driven by market share gains and increased prescriber
adoption.
- ABRAXANE® sales for the third quarter
were $233 million, a 1 percent increase year-over-year. U.S. sales
of $144 million decreased 1 percent year-over-year. International
sales were $89 million.
- In the third quarter, all other product
sales, which include THALOMID®, ISTODAX®, VIDAZA® and an authorized
generic version of VIDAZA® drug product in the U.S., were $229
million compared to $234 million in the third quarter of 2015.
Research and Development (R&D)
On a GAAP basis, R&D expenses were $1,653 million for the
third quarter of 2016 compared to $1,305 million for the same
period in 2015. The increase was primarily driven by a $623.3
million asset acquisition expense associated with the purchase of
EngMab AG and an increase in early research and clinical trial
activity, partially offset by decreases in expenses related to
collaboration-related upfront expenses. Adjusted R&D expenses
were $644 million for the third quarter of 2016 compared to $488
million for the third quarter of 2015.
Selling, General, and Administrative (SG&A)
On a GAAP basis, SG&A expenses were $698 million for the
third quarter of 2016 compared to $550 million for the same period
in 2015. The increase was primarily due to a 2016
litigation-related loss contingency accrual expense as well as an
increase in donations to independent patient assistance
organizations. Adjusted SG&A expenses were $591 million for the
third quarter of 2016 compared to $474 million for the third
quarter of 2015.
Cash, Cash Equivalents, and Marketable Securities
Operating cash flow was $723 million in the third quarter of
2016. Celgene ended the quarter with approximately $6.9 billion in
cash, cash equivalents and marketable securities.
In the third quarter of 2016, Celgene purchased approximately
2.5 million of its shares at a total cost of approximately $273
million. As of September 30, 2016, the Company had approximately
$4.9 billion remaining under the stock repurchase program.
2016 Guidance Updated
Previous 2016 Guidance Updated 2016
Guidance Net Product Sales Total Approximately
$11.0B Approximately $11.2B REVLIMID® Approximately $6.8B
Approximately $7.0B GAAP diluted EPS $3.82 to $4.05 $3.12 to $3.29
Adjusted diluted EPS $5.70 to $5.75 $5.88 to $5.92 GAAP operating
margin Approximately 37% Approximately 31% Adjusted operating
margin Approximately 54.0% Unchanged Weighted average diluted
shares 806M 804M
Net product sales guidance for POMALYST®/IMNOVID®, ABRAXANE® and
OTEZLA® remain unchanged.
2017 Targets Updated
- Total net product sales are expected to
be at the high end of the range of $12.7 billion to $13.0
billion
- REVLIMID® net sales are expected to be
more than $8.0 billion versus the previous target of approximately
$8.0 billion
- Adjusted diluted EPS is expected to be
at the high end of the range of $6.75 to $7.00
The net product sales target for ABRAXANE® and adjusted diluted
share count remain unchanged.
Product and Pipeline
Updates
Hematology/Oncology
- A supplemental New Drug Application
(sNDA) was filed with the U.S. Food and Drug Administration (FDA)
for the expanded indication of REVLIMID® as maintenance treatment
in newly diagnosed multiple myeloma (NDMM) patients after receiving
an autologous stem-cell transplant (ASCT). The sNDA was granted
Priority Review and the Prescription Drug User Fee Act (PDUFA) date
for the submission is February 24, 2017. In June, an application
was submitted to the European Medicines Agency (EMA) for the review
of REVLIMID® as maintenance treatment in NDMM patients after
receiving an ASCT. A decision on the European Union (EU)
application is expected in the first half of 2017.
- In August, the European Commission
approved the inclusion of data from a pooled analysis of patients
with relapsed and/or refractory multiple myeloma and impaired renal
function in the IMNOVID® label.
- Celgene expects to submit a new drug
application (NDA) to the FDA for enasidenib (AG-221) in relapsed
and/or refractory acute myeloid leukemia (AML) with isocitrate
dehydrogenase-2 (IDH2) mutation by year-end. The NDA will be based
on data from an ongoing phase I/II trial in patients with relapsed
and/or refractory AML and other advanced hematologic malignancies
with an IDH2 mutation.
Data at hematology and oncology medical congresses presented in
the third quarter and expected in the fourth quarter include:
- Data from multiple sponsored and
independent studies evaluating the use of ABRAXANE® as a single
agent or in combination with novel agents and novel regimens in
patients with metastatic pancreatic cancer, metastatic breast
cancer and non-small cell lung cancer (NSCLC) were presented during
the European Society of Medical Oncology (ESMO) 2016 Annual Meeting
in October.
- Celgene’s collaboration partner
Triphase Accelerator Corporation is expected to present results
from a phase I trial evaluating marizomib in combination with
bevacizumab in recurrent glioblastoma at the Society for
Neuro-Oncology (SNO) meeting in November.
- Data from the abound® program of
ABRAXANE® in NSCLC are expected to be presented at the IASLC World
Conference on Lung Cancer in December.
- Data from the phase II tnAcity® trial
evaluating ABRAXANE® in combination with gemcitabine or carboplatin
in patients with triple negative breast cancer are expected at The
San Antonio Breast Cancer Symposium (SABCS) in December.
- At the 2016 American Society of
Hematology (ASH) annual meeting in December, data presentations
expected include:
- Phase III Myeloma XI trial evaluating
REVLIMID® as induction and maintenance therapy in patients with
NDMM following ASCT.
- Final overall survival data from the
phase III MM-020 trial evaluating REVLIMID® in combination with
low-dose dexamethasone in patients with NDMM who were not
candidates for stem-cell transplant.
- Phase III REMARC trial comparing
REVLIMID® maintenance to placebo in elderly patients with diffuse
large B-cell lymphoma (DLBCL) previously treated with rituximab
plus chemotherapy (R-CHOP).
- Phase III CONTINUUM trial comparing
REVLIMID® maintenance to placebo in chronic lymphocytic leukemia
following second-line therapy.
- Interim data from the phase III
MAGNIFYTM trial with REVLIMID® in combination with R-CHOP in
patients with relapsed and/or refractory indolent lymphoma.
- Phase Ib trial evaluating CC-122 in
combination with obinutuzumab in patients with relapsed and/or
refractory DLBCL or indolent non-Hodgkin’s lymphoma.
Inflammation & Immunology (I&I)
Data at I&I medical congresses presented in the third
quarter and expected in the fourth quarter include:
- Long-term data from the phase II
RADIANCE trial evaluating ozanimod in relapsing multiple sclerosis
were presented at the European Committee for Treatment and Research
in Multiple Sclerosis (ECTRIMS) in September.
- Phase Ib trial evaluating the effects
of oral GED-0301 (mongersen) on both endoscopic and clinical
outcomes in patients with active Crohn's disease were presented at
the United European Gastroenterology Week (UEGW) in October. The
phase III program continues to enroll with data expected in
2018.
- Phase II trial of RPC4046 in patients
with eosinophilic esophagitis were presented at UEGW and the
American College of Gastroenterology (ACG) meetings in
October.
- Phase II TOUCHSTONE trial evaluating
ozanimod as induction and maintenance in patients with ulcerative
colitis presented at UEGW and ACG.
- Pooled 3-year data analyses from ESTEEM
1 and 2 and PALACE 1-3 trials were presented at the European
Academy of Dermatology and Venereology (EADV) meeting in
October.
- Phase IIb trial of OTEZLA® in Japanese
patients with moderate-to-severe psoriasis were presented at EADV.
This trial will be used to support the regulatory approval in
Japan.
- At the 2016 American College of
Rheumatology annual meeting in November, data presentations
expected include:
- Three-year safety and efficacy data
from the PALACE program with OTEZLA® in psoriatic arthritis.
- Four-year safety and efficacy data from
PALACE 3 trial with OTEZLA® in DMARD- and/or biologic-experienced
psoriatic arthritis patients.
- Pooled three-year data from the PALACE
program for the enthesitis and dactylitis and HAQ-DI
endpoints.
- 52-week data from the PSA-006 trial of
OTEZLA® in biologic-naïve patients with active psoriatic
arthritis.
- Phase II safety and dose-ranging trial
of CC-220 in systemic lupus erythematosus. The second part of the
phase II trial evaluating improvement in skin manifestations and
improvement in the Cutaneous Lupus Area and Severity Index (CLASI)
score is enrolling.
- An encore presentation of the phase Ib
trial evaluating the effects of oral GED-0301 on both endoscopic
and clinical outcomes in patients with active Crohn's disease are
expected at the Advances in Inflammatory Bowel Diseases (AIBD)
meeting in December.
Business Update
In September, Celgene completed a transaction to acquire
Switzerland-based, privately-held biotechnology company EngMab AG
for $625.3 million plus contingent development, regulatory and
commercial milestones. EngMab’s lead molecule is EM901, a T-cell
bi-specific antibody targeting B-cell maturation antigen (BCMA).
The acquisition includes an additional undisclosed program. The
Company plans to file an Investigational New Drug (IND) application
for EM901 in late 2017. The transaction was accounted as an asset
acquisition, resulting in $623.3 million of research and
development expense and $2.0 million of net working capital
acquired.
Third Quarter 2016 Conference Call and
Webcast Information
Celgene will host a conference call to discuss the third quarter
of 2016 operational and financial performance on Thursday, October
27, 2016, at 9 a.m. ET. The conference call will be available by
webcast at www.celgene.com. An audio replay of the call will be
available from noon October 27, 2016, until midnight ET November 3,
2016. To access the replay in the U.S., dial (855) 859-2056;
outside the U.S. dial (404) 537-3406. The participant passcode is
93394009.
About Celgene
Celgene Corporation, headquartered in Summit, New Jersey, is an
integrated global biopharmaceutical company engaged primarily in
the discovery, development and commercialization of innovative
therapies for the treatment of cancer and inflammatory diseases
through next-generation solutions in protein homeostasis,
immuno-oncology, epigenetics, immunology and neuro-inflammation.
For more information, please visit www.celgene.com. Follow Celgene
on Social Media: @Celgene, Pinterest, LinkedIn, FaceBook and
YouTube.
About REVLIMID®
In the U.S., REVLIMID® (lenalidomide) in combination with
dexamethasone is indicated for the treatment of patients with
multiple myeloma. REVLIMID® is indicated for patients with
transfusion-dependent anemia due to Low- or Intermediate-1-risk
myelodysplastic syndromes (MDS) associated with a deletion 5q
cytogenetic abnormality with or without additional cytogenetic
abnormalities. REVLIMID® is approved in the U.S. for the treatment
of patients with mantle cell lymphoma (MCL) whose disease has
relapsed or progressed after two prior therapies, one of which
included bortezomib. Limitations of Use: REVLIMID® is not indicated
and is not recommended for the treatment of chronic lymphocytic
leukemia (CLL) outside of controlled clinical trials.
About ABRAXANE®
In the U.S., ABRAXANE® for Injectable Suspension (paclitaxel
protein-bound particles for injectable suspension) (albumin-bound)
is indicated for the treatment of metastatic breast cancer after
failure of combination chemotherapy for metastatic disease or
relapse within six months of adjuvant chemotherapy. Prior therapy
should have included an anthracycline unless clinically
contraindicated. ABRAXANE® is indicated for the first-line
treatment of locally advanced or metastatic non-small cell lung
cancer, in combination with carboplatin, in patients who are not
candidates for curative surgery or radiation therapy. ABRAXANE® is
also indicated for the first-line treatment of metastatic
adenocarcinoma of the pancreas in combination with gemcitabine.
About POMALYST®
In the U.S., POMALYST® (pomalidomide) is indicated for patients
with multiple myeloma who have received at least two prior
therapies including lenalidomide and a proteasome inhibitor and
have demonstrated disease progression on or within 60 days of
completion of the last therapy.
About OTEZLA®
In the U.S., OTEZLA® (apremilast) is indicated for the treatment
of adult patients with active psoriatic arthritis. OTEZLA® is
indicated in the U.S. for the treatment of patients with moderate
to severe plaque psoriasis who are candidates for phototherapy or
systemic therapy.
Forward-Looking Statement
This press release contains forward-looking statements, which
are generally statements that are not historical facts.
Forward-looking statements can be identified by the words
"expects," "anticipates," "believes," "intends," "estimates,"
"plans," "will," “outlook” and similar expressions. Forward-looking
statements are based on management’s current plans, estimates,
assumptions and projections, and speak only as of the date they are
made. We undertake no obligation to update any forward-looking
statement in light of new information or future events, except as
otherwise required by law. Forward-looking statements involve
inherent risks and uncertainties, most of which are difficult to
predict and are generally beyond our control. Actual results or
outcomes may differ materially from those implied by the
forward-looking statements as a result of the impact of a number of
factors, many of which are discussed in more detail in our Annual
Report on Form 10-K and our other reports filed with the Securities
and Exchange Commission.
Use of Non-GAAP Financial Measures
In addition to financial information prepared in accordance with
U.S. GAAP, this document also contains certain non-GAAP financial
measures based on management’s view of performance including:
- Adjusted research and development
expense
- Adjusted selling, general and
administrative expense
- Adjusted operating margin
- Adjusted net income
- Adjusted earnings per share
Management uses such measures internally for planning and
forecasting purposes and to measure the performance of the Company.
We believe these adjusted financial measures provide useful and
meaningful information to us and investors because they enhance
investors’ understanding of the continuing operating performance of
our business and facilitate the comparison of performance between
past and future periods. These adjusted financial measures are
non-GAAP measures and should be considered in addition to, but not
as a substitute for, the information prepared in accordance with
U.S. GAAP. When preparing these supplemental non-GAAP financial
measures we typically exclude certain GAAP items that management
does not consider to be normal, recurring, cash operating expenses
but that may not meet the definition of unusual or non-recurring
items. Other companies may define these measures in different ways.
The following categories of items are excluded from adjusted
financial results:
Acquisition and Divestiture-Related Costs: We exclude the impact
of certain amounts recorded in connection with business
combinations and divestitures from our adjusted financial results
that are either non-cash or not normal, recurring operating
expenses due to their nature, variability of amounts, and lack of
predictability as to occurrence and/or timing. These amounts may
include non-cash items such as the amortization of acquired
intangible assets, amortization of purchase accounting adjustments
to inventories, intangible asset impairment charges and expense or
income related to changes in the estimated fair value measurement
of contingent consideration. We also exclude transaction and
certain other cash costs associated with business acquisitions and
divestitures that are not normal recurring operating expenses,
including severance costs which are not part of a formal
restructuring program.
Share-based Compensation Expense: We exclude share-based
compensation from our adjusted financial results because
share-based compensation expense, which is non-cash, fluctuates
from period to period based on factors that are not within our
control, such as our stock price on the dates share-based grants
are issued.
Collaboration-related Upfront Expenses: We exclude
collaboration-related upfront expenses from our adjusted financial
results because we do not consider them to be normal, recurring
operating expenses due to their nature, variability of amounts, and
lack of predictability as to occurrence and/or timing. Upfront
payments to collaboration partners are made at the commencement of
a relationship anticipated to continue for a multi-year period and
provide us with intellectual property rights, option rights and
other rights with respect to particular programs. The variability
of amounts and lack of predictability of collaboration-related
upfront expenses makes the identification of trends in our ongoing
research and development activities more difficult. We believe the
presentation of adjusted research and development, which does not
include collaboration-related upfront expenses, provides useful and
meaningful information about our ongoing research and development
activities by enhancing investors’ understanding of our normal,
recurring operating research and development expenses and
facilitates comparisons between periods and with respect to
projected performance. All expenses incurred subsequent to the
initiation of the collaboration arrangement, such as research and
development cost-sharing expenses/reimbursements and milestone
payments up to the point of regulatory approval are considered to
be normal, recurring operating expenses and are included in our
adjusted financial results.
Research and Development Asset Acquisition Expense: We exclude
costs associated with acquiring rights to pre-commercial compounds
because we do not consider such costs to be normal, recurring
operating expenses due to their nature, variability of amounts, and
lack of predictability as to occurrence and/or timing. Research and
development asset acquisition expenses includes expenses to acquire
rights to pre-commercial compounds from a collaboration partner
when there will be no further participation from the collaboration
partner or other parties. The variability of amounts and lack of
predictability of research and development asset acquisition
expenses makes the identification of trends in our ongoing research
and development activities more difficult. We believe the
presentation of adjusted research and development, which does not
include research and development asset acquisition expenses,
provides useful and meaningful information about our ongoing
research and development activities by enhancing investors’
understanding of our normal, recurring operating research and
development expenses and facilitates comparisons between periods
and with respect to projected performance.
Restructuring Costs: We exclude costs associated with
restructuring initiatives from our adjusted financial results.
These costs include amounts associated with facilities to be
closed, employee separation costs and costs to move operations from
one location to another. We do not frequently undertake
restructuring initiatives and therefore do not consider such costs
to be normal, recurring operating expenses.
Certain Other Items: We exclude certain other significant items
that may occur occasionally and are not normal, recurring, cash
operating expenses from our adjusted financial results. Such items
are evaluated on an individual basis based on both the quantitative
and the qualitative aspect of their nature and generally represent
items that, either as a result of their nature or magnitude, we
would not anticipate occurring as part of our normal business on a
regular basis. While not all-inclusive, examples of certain other
significant items excluded from adjusted financial results would
be: expenses for significant litigation-related loss contingency
accruals and expenses to settle other disputed matters.
Estimated Tax Impact From Above Adjustments: We exclude the net
income tax impact of the non-tax adjustments described above from
our adjusted financial results. The net income tax impact of
the non-tax adjustments includes the impact on both current and
deferred income taxes and is based on the taxability of the
adjustment under local tax law and the statutory tax rate in the
tax jurisdiction where the adjustment was incurred.
Non-Operating Tax Adjustments: We exclude the net income tax
impact of certain other significant income tax items, which are not
associated with our normal, recurring operations (“Non-Operating
Tax Items”), from our adjusted financial
results. Non-Operating Tax Items include items which may occur
occasionally and are not normal, recurring operating expenses (or
benefits), including adjustments related to acquisitions,
divestitures, collaborations, certain adjustments to
the amount of unrecognized tax benefits related to prior year
tax positions, and other similar items.
Long-Term Targets
A reconciliation of long-term adjusted financial targets to the
most comparable GAAP measures cannot be provided because we are
unable to forecast with reasonable certainty many of the items
necessary to calculate such comparable GAAP measures, including
share-based compensation expense, collaboration-related upfront
expense, research and development asset acquisition expense,
acquisition-related expenses, fair value adjustments to contingent
consideration, the ultimate outcome of legal proceedings and
unusual gains and losses, as well as unforeseen events, risks and
developments. These items are uncertain, depend on various factors,
and could be material to our results computed in accordance with
GAAP. We believe the inherent uncertainties in reconciling our
long-term non-GAAP measures to the most comparable GAAP measures
would make the forecasted comparable GAAP measures nearly
impossible to predict with reasonable certainty and therefore
inherently unreliable.
See the attached Reconciliations of GAAP to Adjusted Net Income
for explanations of the amounts excluded and included to arrive at
the adjusted measures for the three- and nine-month periods ended
September 30, 2016 and 2015, and for the projected amounts for the
year ending December 31, 2016.
Celgene Corporation and Subsidiaries Condensed
Consolidated Statements of Operations (Unaudited) (In
millions, except per share data)
Three-Month Periods Ended Nine-Month Periods Ended September 30,
September 30, 2016 2015 2016 2015 Net product sales $
2,968.6 $ 2,312.6 $ 8,207.8 $ 6,621.9 Other revenue 14.2
21.5 40.9 70.8
Total revenue 2,982.8 2,334.1
8,248.7 6,692.7 Cost of goods sold
(excluding amortization of acquired intangible assets) 107.7 109.9
324.5 314.7 Research and development 1,653.5 1,304.5 3,335.4
2,920.5 Selling, general and administrative 698.0 550.3 1,973.1
1,696.3 Amortization of acquired intangible assets 87.1 63.6 353.7
190.9 Acquisition related charges and restructuring, net
25.0 226.2 25.3 215.9
Total costs and expenses 2,571.3
2,254.5 6,012.0 5,338.3
Operating income 411.5 79.6 2,236.7 1,354.4 Interest and
investment income, net 7.3 8.6 21.3 26.4 Interest (expense) (127.8
) (88.5 ) (373.0 ) (186.0 ) Other income (expense), net
(34.2 ) (19.6 ) (11.5 ) 83.2
Income (loss) before income taxes 256.8 (19.9 ) 1,873.5 1,278.0
Income tax provision 85.4 14.2
303.2 237.0 Net income (loss) $
171.4 $ (34.1 ) $ 1,570.3 $ 1,041.0
Net income (loss) per common share: Basic $ 0.22 $ (0.04 ) $
2.02 $ 1.31 Diluted $ 0.21 $ (0.04 ) $ 1.95 $ 1.26 Weighted
average shares: Basic 775.8 791.1 777.3 794.3 Diluted 801.5 791.1
803.7 827.7 September 30, December 31, 2016 2015
Balance sheet items: Cash, cash equivalents & marketable
securities $ 6,868.6 $ 6,551.9 Total assets(1) $ 26,753.7 $
26,964.4 Long-term debt, including current portion(1) $ 14,303.5 $
14,161.4 Total stockholders' equity $ 5,650.3 $ 5,919.0
(1) Total assets and long-term debt as of
December 31, 2015 have been adjusted to reflect the retroactive
adoption of ASU 2015-03 in the first quarter of 2016. ASU 2015-03
requires the presentation of debt issuance costs as a reduction of
long-term debt.
Celgene Corporation and
Subsidiaries Reconciliation of GAAP to Adjusted Net
Income (In millions, except per share data)
Three-Month Periods Ended Nine-Month Periods Ended September 30,
September 30, 2016 2015 2016 2015 Net income (loss) - GAAP $
171.4 $ (34.1 ) $ 1,570.3 $ 1,041.0 Before tax adjustments:
Cost of goods sold (excluding amortization of acquired intangible
assets): Share-based compensation expense (1 ) 7.4 8.5 25.0 23.3
Research and development: Share-based compensation expense
(1 ) 63.0 65.2 189.1 185.0 Collaboration-related upfront expense (2
) 323.6 751.8 687.6 1,340.3 Research and development asset
acquisition expense (3 ) 623.3 - 623.3 - Selling, general
and administrative: Share-based compensation expense (1 ) 77.3 76.2
237.6 218.1 Litigation-related loss contingency accrual expense (4
) 30.0 - 130.0 - Amortization of acquired intangible assets
(5 ) 87.1 63.6 353.7 190.9 Acquisition related (gains)
charges and restructuring, net: Change in fair value of contingent
consideration (6 ) 22.9 (6.9 ) 12.2 (17.2 ) Receptos acquisition
costs (7 ) - 231.6 0.1 231.6 Restructuring charges (8 ) 2.1 1.5
13.0 1.5 Income tax provision: Estimated tax impact from
above adjustments (9 ) (144.6 ) (176.6 ) (362.2 ) (351.6 )
Non-operating tax adjustments (10 ) - 30.4
- 58.1 Net income - Adjusted $
1,263.5 $ 1,011.2 $ 3,479.7 $ 2,921.0
Net income per common share - Adjusted Basic $ 1.63 $ 1.28 $
4.48 $ 3.68 Diluted (11 ) $ 1.58 $ 1.23 $ 4.33 $ 3.53
Explanation of adjustments: (1) Exclude share-based
compensation expense totaling $147.7 for the three-month period
ended September 30, 2016 and $149.9 for the three-month period
ended September 30, 2015. Exclude share-based compensation expense
totaling $451.7 for the nine-month period ended September 30, 2016
and $426.4 for the nine-month period ended September 30, 2015. (2)
Exclude upfront payment expense for research and development
collaboration arrangements. (3) Exclude research and development
asset acquisition expenses for EngMab AG. (4) Exclude loss
contingency accrual expense related to a contractual dispute. (5)
Exclude amortization of intangible assets acquired in the
acquisitions of Pharmion Corp., Gloucester Pharmaceuticals, Inc.
(Gloucester), Abraxis BioScience Inc. (Abraxis), Celgene Avilomics
Research, Inc. (Avila), and Quanticel Pharmaceuticals, Inc.
(Quanticel). The excluded amortization expense for the nine-month
period ended September 30, 2016 includes $83.1 million related to
the impairment of an intangible asset acquired in the Avila
acquisition. (6) Exclude changes in the fair value of contingent
consideration related to the acquisitions of Gloucester, Abraxis,
Avila, Nogra Pharma Limited and Quanticel. (7) Exclude equity
compensation and other fees and costs related to the acquisition of
Receptos, Inc. (8) Exclude restructuring charges related to our
relocation of certain operations into our two Summit, NJ locations
as well as costs associated with certain headcount reductions. (9)
Exclude the estimated tax impact from the above adjustments. (10)
Exclude other non-operating tax expense items. The adjustment for
the three- and nine-month periods ended September 30, 2015 related
primarily to the impact of accelerating the full year tax expense
on a gain on the sale of an equity investment into the second
quarter of 2015, which was the period in which the gain occurred,
and the impact of a one-time tax expense incurred as a result of
our global mix of funding sources for certain upfront collaboration
payments. (11) Adjusted diluted net income per share for the
three-month period ended September 30, 2015 was determined using
diluted weighted average shares of 823.6.
Celgene
Corporation and Subsidiaries Reconciliation of Full-Year
2016 Projected GAAP to Adjusted Net Income (In millions,
except per share data) Range
Low High Projected net income - GAAP
(1
) $ 2,504.8 $ 2,644.7 Before tax adjustments: Cost of
goods sold (excluding amortization of acquired intangible assets):
Share-based compensation expense 37.0 35.2 Research and
development: Share-based compensation expense 263.4 250.9
Collaboration-related upfront expense 687.6 687.6 Research and
development asset acquisition expense 623.3 623.3 Selling,
general and administrative: Share-based compensation expense 334.8
318.9 Litigation-related loss contingency accrual expense 130.0
130.0 Amortization of acquired intangible assets 458.2 418.6
Acquisition related (gains) charges and restructuring, net:
Change in fair value of contingent consideration 44.4 40.2
Restructuring charges 30.0 15.0 Income Tax Provision
Estimated tax impact from above adjustments (386.0 ) (404.7 )
Non-operating tax adjustments - -
Projected net income - Adjusted $ 4,727.5 $ 4,759.7
Projected net income per diluted common share - GAAP $ 3.12
$ 3.29 Projected net income per diluted common share -
Adjusted $ 5.88 $ 5.92 Projected weighted average diluted
shares 804.0 804.0 (1) Our projected 2016 earnings do
not include the effect of any business combinations, collaboration
agreements, asset acquisitions, intangible asset impairments,
additional litigation-related loss contingency accruals, changes in
the fair value of our CVRs issued as part of the acquisition of
Abraxis or non-operating tax adjustments that may occur after the
day prior to the date of this press release.
Celgene Corporation and Subsidiaries Net Product
Sales (In millions)
Three-Month Periods Ended September 30,
% Change
2016
2015
Reported
Operational(1)
Currency(2)
REVLIMID® U.S. $ 1,153.3 $ 895.2 28.8 % 28.8 % 0.0 %
International 737.8 558.3 32.2 % 34.9 % (2.7 )%
Worldwide 1,891.1 1,453.5 30.1 % 31.1 % (1.0 )%
POMALYST®/IMNOVID® U.S. 203.3 150.1
35.4 % 35.4 % 0.0 % International 137.8 106.4 29.5 %
27.6 % 1.9 % Worldwide 341.1 256.5 33.0 % 32.2 % 0.8 %
OTEZLA®(3) U.S. 244.5 128.4 N/A N/A N/A International
30.1 10.3 N/A N/A N/A Worldwide 274.6 138.7 N/A N/A
N/A
ABRAXANE® U.S. 144.0 145.2 (0.8 )% (0.8 )%
0.0 % International 89.3 84.7 5.4 % 7.2 % (1.8 )%
Worldwide 233.3 229.9 1.5 % 2.1 % (0.6 )%
VIDAZA® U.S. 2.7 4.9 (44.9 )% (44.9 )% 0.0 %
International 152.0 142.7 6.5 % 8.9 % (2.4 )%
Worldwide 154.7 147.6 4.8 % 7.1 % (2.3 )%
azacitidine for
injection U.S. 15.3 21.3 (28.2 )% (28.2 )% 0.0 % International
- - N/A N/A N/A Worldwide 15.3 21.3 (28.2 )% (28.2 )%
0.0 %
THALOMID® U.S. 24.6 31.3 (21.4 )% (21.4
)% 0.0 % International 13.7 13.8 (0.7 )% 4.2 % (4.9
)% Worldwide 38.3 45.1 (15.1 )% (13.6 )% (1.5 )%
ISTODAX® U.S. 17.2 16.2 6.2 % 6.2 % 0.0 %
International 2.2 1.1 100.0 % 104.1 % (4.1 )%
Worldwide 19.4 17.3 12.1 % 12.4 % (0.3 )%
All Other
U.S. - 2.0 N/A N/A N/A International 0.8 0.7 N/A N/A
N/A Worldwide 0.8 2.7 N/A N/A N/A
Total Net Product
Sales U.S. 1,804.9 1,394.6 29.4 % 29.4 % 0.0 % International
1,163.7 918.0 26.8 % 28.6 % (1.8 )% Worldwide $
2,968.6 $ 2,312.6 28.4 % 29.1 % (0.7 )% (1)
Operational includes impact from both volume and price (2) Currency
includes the impact from both foreign exchange rates and hedging
activities (3) OTEZLA® was approved in the U.S. for Psoriatic
Arthritis in March 2014 and approved in the U.S. for Psoriasis in
September 2014. OTEZLA® was approved for Psoriatic Arthritis and
Plaque Psoriasis in the EU in January 2015.
Celgene Corporation and Subsidiaries Net Product
Sales (In millions)
Nine-Month Periods Ended September 30,
% Change 2016 2015 Reported
Operational(1)
Currency(2)
REVLIMID® U.S. $ 3,229.4 $ 2,578.6 25.2 % 25.2 % 0.0
% International 1,936.1 1,661.8 16.5 % 19.6 % (3.1 )%
Worldwide 5,165.5 4,240.4 21.8 % 23.0 % (1.2 )%
POMALYST®/IMNOVID® U.S. 558.9 422.1
32.4 % 32.4 % 0.0 % International 373.9 267.4 39.8 %
38.2 % 1.6 % Worldwide 932.8 689.5 35.3 % 34.7 % 0.6 %
OTEZLA®(3) U.S. 636.1 272.5 N/A N/A N/A International
76.0 16.2 N/A N/A N/A Worldwide 712.1 288.7 N/A N/A
N/A
ABRAXANE® U.S. 462.5 474.1 (2.4 )% (2.4 )%
0.0 % International 244.8 223.4 9.6 % 11.7 % (2.1 )%
Worldwide 707.3 697.5 1.4 % 2.1 % (0.7 )%
VIDAZA® U.S. 9.8 16.4 (40.2 )% (40.2 )% 0.0 %
International 445.7 426.9 4.4 % 7.9 % (3.5 )%
Worldwide 455.5 443.3 2.8 % 6.2 % (3.4 )%
azacitidine for
injection U.S. 55.5 64.2 (13.6 )% (13.6 )% 0.0 % International
- - N/A N/A N/A Worldwide 55.5 64.2 (13.6 )% (13.6 )%
0.0 %
THALOMID® U.S. 75.4 97.5 (22.7 )% (22.7
)% 0.0 % International 41.6 42.4 (1.9 )% 2.6 % (4.5
)% Worldwide 117.0 139.9 (16.4 )% (15.0 )% (1.4 )%
ISTODAX® U.S. 52.8 48.4 9.1 % 9.1 % 0.0 %
International 5.8 3.3 75.8 % 83.1 % (7.3 )% Worldwide
58.6 51.7 13.3 % 13.8 % (0.5 )%
All Other U.S. 1.2
4.7 N/A N/A N/A International 2.3 2.0 N/A N/A N/A
Worldwide 3.5 6.7 N/A N/A N/A
Total Net Product Sales
U.S. 5,081.6 3,978.5 27.7 % 27.7 % 0.0 % International
3,126.2 2,643.4 18.3 % 20.7 % (2.4 )% Worldwide $ 8,207.8 $
6,621.9 23.9 % 24.9 % (1.0 )% (1) Operational
includes impact from both volume and price (2) Currency includes
the impact from both foreign exchange rates and hedging activities
(3) OTEZLA® was approved in the U.S. for Psoriatic Arthritis in
March 2014 and approved in the U.S. for Psoriasis in September
2014. OTEZLA® was approved for Psoriatic Arthritis and Plaque
Psoriasis in the EU in January 2015.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161027005807/en/
Celgene CorporationInvestors:Patrick E. Flanigan III,
908-673-9969Corporate Vice PresidentInvestor RelationsorMedia:Brian
P. Gill, 908-673-9530Vice PresidentCorporate Communications
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