-Total 2017 CF product revenues of $2.17
billion, a 29% increase compared to $1.68 billion in 2016; 2017
KALYDECO revenues of $845 million and 2017 ORKAMBI revenues of
$1.32 billion-
Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX) today
reported consolidated financial results for the full year and
fourth quarter ended December 31, 2017.
Key financial results include:
Three Months EndedDecember
31,
%
Twelve Months EndedDecember
31,
%
2017 2016 Change 2017
2016 Change (in millions, except per
share and percentage data)
ORKAMBI product revenues, net $
365 $ 277 32% $ 1,321 $ 980 35%
KALYDECO product revenues,
net $
256
$
177
44% $
845
$
703
20%
TOTAL CF product revenues, net $
621
$
454
37% $
2,165
$
1,683
29%
GAAP Collaborative revenues $ 29 $ 1 n/a $ 315 $
2 n/a
GAAP net income (loss) $ 101 $ 33 206% $ 263 $
(112 ) n/a
GAAP net income (loss) per share - diluted $ 0.39
$ 0.13 200% $ 1.04 $ (0.46 ) n/a
Non-GAAP net income
$ 158 $ 88 80% $ 495 $ 211 134%
Non-GAAP net income per share -
diluted $ 0.61 $ 0.35 74% $ 1.95 $ 0.85 129%
"2017 was an outstanding year for Vertex as we made significant
progress across all aspects of our business that moved us closer
toward our goal of delivering new medicines that treat the
underlying cause of CF for all people with the disease,” said
Jeffrey Leiden, M.D., Ph.D., Chairman, President and Chief
Executive Officer of Vertex. “As we look at 2018 and beyond,
Vertex’s scientific expertise and financial strength position us to
advance key pipeline programs in CF, including our triple
combination regimens, and to bring forward potential new medicines
in multiple other serious diseases."
Full-Year 2017 Financial
Highlights
Revenues:
- Total CF product revenues increased 29%
to $2.17 billion from $1.68 billion for 2016.
- Net product revenues from ORKAMBI
increased 35% to $1.32 billion from $979.6 million for 2016. The
increase in ORKAMBI revenues was driven by the continued uptake in
children with CF ages 6 to 11 in the U.S. and an increase in the
number of patients being treated in European countries where
ORKAMBI is currently reimbursed.
- Net product revenues from KALYDECO
increased 20% to $844.6 million from $703.4 million for 2016. The
increase in KALYDECO revenues was primarily driven by the rapid
uptake among people ages 2 and older in the U.S. who have certain
residual function mutations and continued growth in the number of
patients being treated outside of the U.S. where KALYDECO is
currently approved and reimbursed.
- GAAP collaborative revenues increased
to $315.2 million, from $1.9 million for 2016. 2017
collaborative revenues include $230.0 million in upfront revenue
from the out-licensing of four oncology programs to Merck KGaA,
Darmstadt, Germany in January 2017.
Expenses:
- Combined GAAP R&D and SG&A
expenses were $1.82 billion compared to $1.48 billion for 2016.
Combined Non-GAAP R&D and SG&A were $1.33 billion compared
to $1.20 billion for 2016.
- GAAP R&D expenses were $1.32
billion compared to $1.05 billion for 2016. The increase in GAAP
R&D expenses was primarily due to an upfront payment of $160.0
million related to the acquisition of VX-561 (previously known as
CTP-656), an investigational once-daily CFTR potentiator, from
Concert Pharmaceuticals. Non-GAAP R&D expenses were $959.5
million compared to $857.8 million for 2016. The increase in
non-GAAP R&D expenses was primarily attributable to the
clinical development of the company's triple combination regimens
for CF.
- GAAP SG&A expenses were $496.1
million compared to $432.8 million for 2016. Non-GAAP SG&A
expenses were $375.3 million compared to $344.2 million for 2016.
The increase in GAAP and non-GAAP SG&A expenses was driven by
investments to support the treatment of patients with KALYDECO and
ORKAMBI globally and additional investments to prepare for the U.S.
launch of the tezacaftor/ivacaftor combination.
Net Income (Loss) Attributable to Vertex:
- GAAP net income was $263.5 million, or
$1.04 per diluted share, compared to a 2016 GAAP net loss of
$(112.1) million, or $(0.46) per diluted share. Non-GAAP net income
was $494.6 million, or $1.95 per diluted share, compared to a 2016
non-GAAP net income of $211.2 million, or $0.85 per diluted share,
for 2016. Full-year 2017 GAAP and non-GAAP net income growth was
driven by increased CF product revenues.
Cash Position:
- As of December 31, 2017, Vertex
had $2.09 billion in cash, cash equivalents and marketable
securities after repayment of the $300 million balance of
outstanding debt in the first quarter of 2017 from a revolving
credit agreement, compared to $1.43 billion in cash, cash
equivalents and marketable securities as of December 31,
2016.
Fourth-Quarter 2017 Financial
Highlights
Revenues:
- Total CF net product revenues increased
37% to $621.2 million from $454.0 million for the fourth quarter of
2016.
- Net product revenues from ORKAMBI
increased 32% to $365.4 million from $276.9 million for the fourth
quarter of 2016.
- Net product revenues from KALYDECO
increased 44% to $255.8 million from $177.1 million for the fourth
quarter of 2016.
- GAAP collaborative revenues increased
to $29.1 million from $0.9 million for 2016. Fourth-quarter
2017 collaborative revenues include a $25 million milestone payment
from Janssen Pharmaceuticals, Inc. based on the initiation of a
pivotal Phase 3 clinical trial of pimodivir (previously VX-787) for
treatment in patients who are hospitalized or are outpatients at
higher risk of influenza-related complications.
Expenses:
- Combined GAAP R&D and SG&A
expenses were $441.5 million compared to $358.4 million for the
fourth quarter of 2016. Combined non-GAAP R&D and SG&A
expenses were $354.7 million compared to $295.0 million for the
fourth quarter of 2016.
- GAAP R&D expenses were $306.7
million compared to $248.5 million for the fourth quarter of 2016.
Non-GAAP R&D expenses were $249.2 million compared to $207.1
million for the fourth quarter of 2016.
- GAAP SG&A expenses were $134.8
million compared to $109.9 million for the fourth quarter of 2016.
Non-GAAP SG&A expenses were $105.5 million compared to $87.9
million for the fourth quarter of 2016.
Net Income Attributable to Vertex:
- GAAP net income was $100.7 million, or
$0.39 per diluted share, compared to $32.9 million, or $0.13 per
diluted share, for the fourth quarter of 2016. Non-GAAP net income
was $157.9 million, or $0.61 per diluted share, compared to $87.7
million, or $0.35 per diluted share, for the fourth quarter of
2016.
2018 Financial Guidance
Vertex today provided full-year 2018 guidance for combined GAAP
and non-GAAP R&D and SG&A expenses, as summarized
below:
- Combined Non-GAAP and GAAP R&D
and SG&A Expenses: Vertex expects that its combined GAAP
R&D and SG&A expense in 2018 will be in the range of $1.80
to $1.95 billion and combined non-GAAP R&D and SG&A expense
will be in the range of $1.50 to $1.55 billion. The increase
compared to 2017 primarily reflects ongoing and anticipated CF
development efforts, including the investment for the preparation
and commercial supply for up to two pivotal programs for its triple
combination regimens, and the incremental investment to support the
planned launch of the tezacaftor/ivacaftor combination.
Vertex plans to provide total CF product revenue guidance for
the full year of 2018 upon the anticipated approval by the U.S.
Food and Drug Administration (FDA) of the tezacaftor/ivacaftor
combination, which has an action date of February 28, 2018.
Stock Repurchase Program
The company today announced that its Board of
Directors has authorized a share repurchase program of up to $500
million of common stock through December 31, 2019. The repurchase
program is expected to be executed over two years with the primary
objective of reducing the impact of dilution from employee equity
programs.
Purchases may be made through the open market
or privately negotiated transactions and may be made pursuant to
Rule 10b5-1 plans or other means as determined by Vertex's
management and in accordance with the requirements of the
Securities and Exchange Commission.
“In 2017, we achieved significant revenues, earnings and cash
flow growth, and we expect this will continue as we increase the
number of patients we treat with our CF medicines,” said Ian Smith,
Executive Vice President and Chief Operating Officer. “At the same
time, we will continue our internal and external investments to
advance our CF pipeline and the development of transformational
medicines in other disease areas.”
Business Highlights
ORKAMBI
On January 10, 2018, Vertex announced that
the European Medicines Agency (EMA) has granted extension of the
Marketing Authorization for ORKAMBI in people with CF who have two
copies of the F508del mutation to include children ages 6 through
11. In Europe, there are approximately 3,400 children ages 6
through 11 with two copies of this mutation.
In the first quarter of 2018, Vertex plans to
submit a New Drug Application (NDA) to the U.S. Food and Drug
Administration (FDA) and Marketing Authorization Application (MAA)
line extension to the EMA for the use of ORKAMBI in children ages 2
to 5 with CF who have two copies of the F508del mutation.
KALYDECO
On December 7, 2017, Vertex announced
positive results from an open-label Phase 3 study evaluating the
safety and tolerability of KALYDECO in infants ages 1 to 2 years
who have one of 10 mutations for which KALYDECO is currently
approved. The study met its primary endpoint of safety, showing
that KALYDECO was generally well tolerated, and safety data were
consistent with those seen in previous Phase 3 studies of KALYDECO
in children ages 2 to 5 years and 6 to 11 years. There was also
substantial improvement in sweat chloride, a secondary endpoint, as
well as in multiple measures of pancreatic function.
Based on results from this study, Vertex
expects to submit regulatory applications to the FDA and EMA in the
first quarter of 2018.
TEZACAFTOR/IVACAFTOR
An NDA for the tezacaftor/ivacaftor
combination treatment for people with CF ages 12 and older who have
two copies of the F508del mutation or who have at least one
residual function mutation that is responsive to
tezacaftor/ivacaftor is currently under priority review by the FDA
with an action date of February 28, 2018. The EMA has validated the
MAA for the tezacaftor/ivacaftor combination and the company
expects approval in the EU in the second half of 2018.
TRIPLE COMBINATION REGIMENS
In a separate press release today, Vertex
announced the selection of two next-generation correctors, VX-659
and VX-445, to advance into Phase 3 development as part of two
different triple combination regimens for people with CF. Upon the
completion of regulatory discussions, the company plans to initiate
a Phase 3 program in the first half of 2018 to evaluate VX-659 in
triple combination with tezacaftor and ivacaftor. In addition,
Vertex plans to initiate a Phase 3 program in mid-2018 to evaluate
VX-445 in triple combination with tezacaftor and VX-561 as a
once-daily regimen, pending additional data in the first half of
2018, including Phase 2 data on the combination of VX-445,
tezacaftor and VX-561.
SICKLE CELL DISEASE & β-THALASSEMIA
On December 12, 2017, Vertex and CRISPR
Therapeutics announced that the companies will co-develop and
co-commercialize CTX001, an investigational gene editing treatment,
as part of the companies' previously announced collaboration aimed
at the discovery and development of new gene editing treatments
that use the CRISPR/Cas9 technology. CTX001 represents the first
gene-based treatment that Vertex exclusively licensed from CRISPR
Therapeutics as part of the collaboration.
For CTX001, CRISPR and Vertex will equally
share all research and development costs and profits worldwide. A
Clinical Trial Application (CTA) was submitted in December 2017 for
CTX001 to support the initiation of a Phase 1/2 trial in
β-thalassemia in 2018 in Europe, and an Investigational New Drug
(IND) Application is planned to support the initiation of a Phase
1/2 trial in sickle cell disease in 2018 in the U.S. Additional
details on the trial designs will be provided upon study
initiation.
INFLUENZA
During the fourth quarter of 2017, Vertex
earned a $25 million milestone payment from Janssen
Pharmaceuticals, Inc. (Janssen) based on the initiation of a
pivotal Phase 3 clinical trial of pimodivir (JNJ-63623872) in
combination with standard of care treatment in patients who are
hospitalized or are outpatients at higher risk of influenza-related
complications.
In June 2014, Vertex entered into a licensing
agreement with Janssen for the worldwide development and
commercialization of pimodivir, previously VX-787 discovered by
Vertex. As part of the agreement, Vertex has the potential to
receive development and commercial milestone payments as well as
tiered royalties ranging from the high-single digits to mid-teens
based on a percent of future net product sales.
The pimodivir development program receives
funding support from the Biomedical Advanced Research and
Development Authority (BARDA), part of the U.S. Department of
Health and Human Services.
PAIN
In the first quarter of 2018, Vertex expects
to obtain data from a Phase 2 proof-of-concept study evaluating
VX-150, a selective NaV1.8 channel blocker, for the treatment of
acute pain following bunionectomy surgery. An additional Phase 2
proof-of-concept study further evaluating VX-150 for the treatment
of pain caused by small fiber neuropathy is ongoing.
ONGOING RESEARCH & DEVELOPMENT
Vertex has ongoing development programs for
potential medicines aimed at other serious and life-threatening
diseases, including VX-210 for the treatment of acute cervical
spinal cord injury. In addition, Vertex is progressing additional
internal research programs in sickle cell disease, alpha-1
antitrypsin disease, adrenoleukodystrophy, and polycystic kidney
disease. The company expects to advance one or more research-stage
drug candidates into clinical development in 2018.
Non-GAAP Financial
Measures
In this press release, Vertex's financial results and financial
guidance are provided in accordance with accounting principles
generally accepted in the United States (GAAP) and using certain
non-GAAP financial measures. In particular, non-GAAP financial
results and guidance exclude (i) stock-based compensation expense,
(ii) revenues and expenses related to business development
transactions including collaboration agreements and asset
acquisitions, (iii) revenues and expenses related to consolidated
variable interest entities, including asset impairment charges and
related income tax benefits and the effects of the deconsolidation
of a variable interest entity and (iv) other adjustments. These
results are provided as a complement to results provided in
accordance with GAAP because management believes these non-GAAP
financial measures help indicate underlying trends in the company's
business, are important in comparing current results with prior
period results and provide additional information regarding the
company's financial position. Management also uses these non-GAAP
financial measures to establish budgets and operational goals that
are communicated internally and externally and to manage the
company's business and to evaluate its performance. The company
adjusts, where appropriate, for both revenues and expenses in order
to reflect the company's operations. The company provides guidance
regarding product revenues in accordance with GAAP and provides
guidance regarding combined research and development and sales,
general, and administrative expenses on both a GAAP and a non-GAAP
basis. The guidance regarding GAAP research and development
expenses and sales, general and administrative expenses does not
include estimates regarding expenses associated with any potential
future business development activities. A reconciliation of the
GAAP financial results to non-GAAP financial results is included in
the attached financial information.
Vertex Pharmaceuticals
Incorporated
Fourth-Quarter Results
Consolidated Statements of Operations
Data
(in thousands, except per share
amounts)
(unaudited)
Three Months Ended December 31, Twelve Months Ended
December 31, 2017 2016
2017 2016 Revenues: Product
revenues, net $ 621,228 $ 453,882 $ 2,165,480 $ 1,683,632 Royalty
revenues 1,345 3,887 7,988 16,600 Collaborative revenues (Note 1)
29,061 937 315,184 1,945 Total revenues
651,634 458,706 2,488,652 1,702,177 Costs and expenses: Cost of
product revenues 83,712 59,646 272,675 206,811 Royalty expenses 340
836 2,444 3,649 Research and development expenses 306,664 248,452
1,324,625 1,047,690 Sales, general and administrative expenses
134,794 109,908 496,079 432,829 Restructuring expenses 387 224
14,246 1,262 Intangible asset impairment charge (Note 2) — —
255,340 — Total costs and expenses 525,897
419,066 2,365,409 1,692,241 Income from
operations 125,737 39,640 123,243 9,936 Interest expense, net
(12,547 ) (20,439 ) (57,550 ) (81,432 ) Other (expenses) income,
net (Note 2) (748 ) 1,105 (81,382 ) 4,130 Income
(loss) from operations before provision for (benefit from) income
taxes (Note 2) 112,442 20,306 (15,689 ) (67,366 ) Provision for
(benefit from) income taxes (Note 2) 10,257 (7,453 )
(107,324 ) 16,665 Net income (loss) 102,185 27,759 91,635
(84,031 ) (Income) loss attributable to noncontrolling interest
(Note 2) (1,501 ) 5,186 171,849 (28,021 ) Net income
(loss) attributable to Vertex $ 100,684 $ 32,945 $
263,484 $ (112,052 ) Amounts per share attributable
to Vertex common shareholders: Net income (loss): Basic $ 0.40 $
0.13 $ 1.06 $ (0.46 ) Diluted $ 0.39 $ 0.13 $ 1.04 $ (0.46 ) Shares
used in per share calculations: Basic 251,557 245,454 248,858
244,685 Diluted 256,804 247,757 253,225 244,685
Reconciliation of GAAP to Non-GAAP Net
Income (Loss)
Fourth-Quarter Results
(in thousands, except per share
amounts)
(unaudited)
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2017 2016 2017
2016 GAAP net income (loss) attributable to Vertex $
100,684 $ 32,945 $ 263,484 $ (112,052 ) Stock-based compensation
expense 75,402 59,082 290,736 237,705 Concert upfront and
transaction expenses (Note 3) — — 165,057 — Revenues and expenses
related to VIEs (Note 2) — (4,500 ) 14,083 54,850 Other
collaborative and transaction revenue and expenses (Note 4) (19,177
) — (255,747 ) 33,000 Other adjustments (Note 5) 941 145
16,947 (2,306 )
Non-GAAP net income attributable
to Vertex $ 157,850 $ 87,672 $ 494,560 $
211,197 Amounts per diluted share attributable to
Vertex common shareholders: GAAP $ 0.39 $ 0.13 $ 1.04 $ (0.46 )
Non-GAAP $ 0.61 $ 0.35 $ 1.95 $ 0.85 Shares used in diluted per
share calculations: GAAP 256,804 247,757 253,225 244,685 Non-GAAP
256,804 247,757 253,225 247,276
Reconciliation of GAAP to Non-GAAP
Revenues and Expenses
Fourth-Quarter Results
(in thousands)
(unaudited)
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2017 2016 2017
2016 GAAP total revenues $ 651,634 $ 458,706 $
2,488,652 $ 1,702,177 Revenues related to VIEs (Note 2) (497 ) (94
) (43,376 ) (944 ) Other collaborative and transaction revenue
(Note 4) (28,509 ) — (271,605 ) — Other adjustments (Note 5) —
(121 ) — (526 )
Non-GAAP total revenues $
622,628 $ 458,491 $ 2,173,671 $ 1,700,707
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2017 2016 2017 2016 GAAP cost of
product revenues and royalty expenses $ 84,052 $ 60,482 $
275,119 $ 210,460 Other adjustments (Note 5) — 98 —
(19 )
Non-GAAP cost of product revenues and royalty
expenses $ 84,052 $ 60,580 $ 275,119 $ 210,441
GAAP
research and development expenses $ 306,664 $ 248,452 $
1,324,625 $ 1,047,690 Stock-based compensation expense (47,045 )
(38,383 ) (181,900 ) (153,451 ) Concert upfront payment (Note 3) —
— (160,000 ) — Expenses related to VIEs (Note 2) (967 ) (2,971 )
(7,729 ) (6,762 ) Other collaborative and transaction expenses
(Note 4) (9,282 ) — (14,966 ) (33,000 ) Other adjustments (Note 5)
(136 ) (13 ) (544 ) 3,293
Non-GAAP research and
development expenses $ 249,234 $ 207,085 $ 959,486 $ 857,770
GAAP sales, general and administrative expenses $
134,794 $ 109,908 $ 496,079 $ 432,829 Stock-based compensation
expense (28,357 ) (20,699 ) (108,836 ) (84,254 ) Concert
transaction expenses (Note 3) — — (5,057 ) — Expenses related to
VIEs (Note 2) (465 ) (1,160 ) (3,826 ) (4,160 ) Other collaborative
and transaction expenses (Note 4) (50 ) — (892 ) — Other
adjustments (Note 5) (418 ) (127 ) (2,157 ) (232 )
Non-GAAP
sales, general and administrative expenses $ 105,504 $ 87,922 $
375,311 $ 344,183
Combined non-GAAP
R&D and SG&A expenses $ 354,738 $ 295,007
$ 1,334,797 $ 1,201,953
Three Months EndedDecember
31,
Twelve Months EndedDecember
31,
2017 2016 2017 2016 GAAP interest
expense, net and other expense, net $ (13,295 ) $ (19,334 ) $
(138,932 ) $ (77,302 ) (Income) expenses related to VIEs (Note 2)
(4 ) (32 ) 76,503 108
Non-GAAP interest expense,
net and other expense, net $ (13,299 ) $ (19,366 ) $ (62,429 )
$ (77,194 )
GAAP provision for (benefit from) income
taxes $ 10,257 $ (7,453 ) $ (107,324 ) $ 16,665 Income taxes
related to VIEs (Note 2) 2,432 3,320 114,090
(16,743 )
Non-GAAP provision for (benefit from) income taxes
$ 12,689 $ (4,133 ) $ 6,766 $ (78 )
Condensed Consolidated Balance Sheets
Data
(in thousands)
(unaudited)
December 31, 2017 December 31, 2016
Assets Cash, cash equivalents and marketable securities $
2,088,666 $ 1,434,557 Restricted cash and cash equivalents (VIE)
(Note 2) 1,489 47,762 Accounts receivable, net 281,343 200,364
Inventories 111,830 77,604 Property and equipment, net 789,437
698,362 Intangible assets and goodwill (Note 2) 79,384 334,724
Other assets 193,865 103,414
Total assets $ 3,546,014
$ 2,896,787
Liabilities and Shareholders'
Equity Accounts payable and accruals $ 517,955 $ 376,700 Other
liabilities 415,501 260,984 Deferred tax liability (Note 2) 6,341
134,063 Construction financing lease obligation 563,911 486,849
Debt — 300,000 Shareholders' equity 2,042,306 1,338,191
Total liabilities and shareholders' equity $ 3,546,014
$ 2,896,787 Common shares outstanding 253,253 248,301
Note 1: In the three months ended December 31, 2017,
collaborative revenues were primarily attributable to a $25.0
million milestone earned from our collaboration with Janssen
Pharmaceuticals, Inc. During the twelve months ended
December 31, 2017, collaborative revenues also include a
$230.0 million up-front payment earned from our collaboration with
Merck KGaA, Darmstadt, Germany and $40.0 million that one of the
company's consolidated variable interest entities ("VIEs") received
from a collaboration agreement with a third party.
Note 2: The company consolidated the financial statements
of Parion as a VIE during 2016 and through September 30, 2017 and
BioAxone Biosciences, Inc. as a VIE during 2016 and 2017. These
VIEs were consolidated because Vertex has licensed the rights to
develop the company's collaborators' most significant intellectual
property assets. The company's interest and obligations with
respect to these VIEs' assets and liabilities are limited to those
accorded to the company in its collaboration agreements.
"Restricted cash and cash equivalents (VIE)" reflects the VIEs’
cash and cash equivalents, which Vertex does not have any interest
in and which will not be used to fund the collaboration. Each
reporting period Vertex estimates the fair value of the contingent
payments by Vertex to these collaborators. Any increase in the fair
value of these contingent payments results in a decrease in net
income attributable to Vertex (or an increase in net loss
attributable to Vertex) on a dollar-for-dollar basis. The fair
value of contingent payments is evaluated each quarter and any
change in the fair value is reflected in the company's statement of
operations.
In the third quarter of 2017, the company determined that the
value of Parion’s pulmonary ENaC platform had become impaired and
that the fair value of the intangible asset was zero as of
September 30, 2017. Accordingly, an impairment charge of $255.3
million and a benefit from income taxes of $126.2 million resulting
from this charge and subsequent deconsolidation of Parion
attributable to noncontrolling interest was recorded in the third
quarter of 2017. The total impact of this transaction on a GAAP
basis was a $198.7 million loss attributable to noncontrolling
interest and a $7.1 million loss attributable to Vertex and had no
impact on Vertex’s non-GAAP net income in the third quarter of
2017.
As of December 31, 2017, the company has a $29.0 million
intangible asset related to its collaboration agreement with
BioAxone Biosciences, Inc.
Note 3: In July 2017, the company completed the
acquisition of VX-561 (formerly CTP-656) from Concert
Pharmaceuticals, Inc. The company paid Concert $160.0
million in cash to acquire VX-561, which was recorded as a
research and development expense in the twelve months ended
December 31, 2017. The company also recorded $5.1 million in
transaction costs that were recorded as sales, general and
administrative expenses in the twelve months ended December 31,
2017.
Note 4: In the three months ended December 31, 2017,
"Other collaboration and transaction revenues and expenses" were
primarily attributable to the $25.0 million milestone earned from
our collaboration with Janssen Pharmaceuticals, Inc. In the twelve
months ended December 31, 2017, "Other collaboration and
transaction revenues and expenses" also include revenues and
expenses associated with the company's oncology program including
the company's collaboration with Merck KGaA, Darmstadt, Germany
which include the $230 million upfront payment earned pursuant to
the collaboration. In the three and twelve months ended December
31, 2016, "Other collaboration and transaction revenues and
expenses" primarily consisted of collaboration and asset
acquisition payments for early-stage research assets. The company
has not adjusted its prior year Reconciliation of GAAP to Non-GAAP
Revenues and Expenses for the three and twelve months ended
December 31, 2016 for $5.8 million and $20.7 million, respectively,
of operating expenses related to its oncology program.
Note 5: In the twelve months ended December 31,
2017, "Other adjustments" primarily consisted of restructuring
charges related to the company's decision to consolidate its
research activities into its Boston, Milton Park and San Diego
locations and to close our research site in Canada. In the twelve
months ended December 31, 2016, "Other adjustments" primarily
consisted of revenues and operating costs and expenses related to
HCV as well as restructuring charges related to the company's
relocation from Cambridge to Boston, Massachusetts.
INDICATION AND IMPORTANT SAFETY INFORMATION FOR KALYDECO®
(ivacaftor)
KALYDECO (ivacaftor) is a prescription medicine used for the
treatment of cystic fibrosis (CF) in patients age 2 years and older
who have one mutation in their CF gene that is responsive to
KALYDECO. Patients should talk to their doctor to learn if they
have an indicated CF gene mutation. It is not known if KALYDECO is
safe and effective in children under 2 years of age.
Patients should not take KALYDECO if they are taking certain
medicines or herbal supplements such as: the antibiotics
rifampin or rifabutin; seizure medications such as phenobarbital,
carbamazepine, or phenytoin; or St. John’s wort.
Before taking KALYDECO, patients should tell their doctor if
they: have liver or kidney problems; drink grapefruit juice, or
eat grapefruit or Seville oranges; are pregnant or plan to become
pregnant because it is not known if KALYDECO will harm an unborn
baby; and are breastfeeding or planning to breastfeed because is
not known if KALYDECO passes into breast milk.
KALYDECO may affect the way other medicines work, and other
medicines may affect how KALYDECO works. Therefore the dose of
KALYDECO may need to be adjusted when taken with certain
medications. Patients should especially tell their doctor if they
take antifungal medications such as ketoconazole, itraconazole,
posaconazole, voriconazole, or fluconazole; or antibiotics such as
telithromycin, clarithromycin, or erythromycin.
KALYDECO can cause dizziness in some people who take it.
Patients should not drive a car, use machinery, or do anything that
needs them to be alert until they know how KALYDECO affects them.
Patients should avoid food containing grapefruit or Seville oranges
while taking KALYDECO.
KALYDECO can cause serious side effects including:
High liver enzymes in the blood have been reported in
patients receiving KALYDECO. The patient’s doctor will do blood
tests to check their liver before starting KALYDECO, every 3 months
during the first year of taking KALYDECO, and every year while
taking KALYDECO. For patients who have had high liver enzymes in
the past, the doctor may do blood tests to check the liver more
often. Patients should call their doctor right away if they have
any of the following symptoms of liver problems: pain or discomfort
in the upper right stomach (abdominal) area; yellowing of their
skin or the white part of their eyes; loss of appetite; nausea or
vomiting; or dark, amber-colored urine.
Abnormality of the eye lens (cataract) has been noted in some
children and adolescents receiving KALYDECO. The patient’s doctor
should perform eye examinations prior to and during treatment with
KALYDECO to look for cataracts. The most common side effects
include headache; upper respiratory tract infection (common cold),
which includes sore throat, nasal or sinus congestion, and runny
nose; stomach (abdominal) pain; diarrhea; rash; nausea; and
dizziness.
These are not all the possible side effects of KALYDECO.
Please click here to see the full Prescribing
Information for KALYDECO (ivacaftor).
INDICATION AND IMPORTANT SAFETY INFORMATION FOR
ORKAMBI® (lumacaftor/ivacaftor) TABLETS
ORKAMBI is a prescription medicine used for the treatment of
cystic fibrosis (CF) in patients age 6 years and older who have two
copies of the F508del mutation (F508del/F508del) in their CFTR
gene. ORKAMBI should only be used in these patients. It is not
known if ORKAMBI is safe and effective in children under 6 years of
age.
Patients should not take ORKAMBI if they are taking certain
medicines or herbal supplements, such as: the antibiotics
rifampin or rifabutin; the seizure medicines phenobarbital,
carbamazepine, or phenytoin; the sedatives and anti-anxiety
medicines triazolam or midazolam; the immunosuppressant medicines
cyclosporin, everolimus, sirolimus, or tacrolimus; or St. John’s
wort.
Before taking ORKAMBI, patients should tell their doctor
about all their medical conditions, including if they: have or
have had liver problems; have kidney problems; have had an organ
transplant; or are using birth control. Hormonal contraceptives,
including oral, injectable, transdermal, or implantable forms
should not be used as a method of birth control when taking
ORKAMBI. Patients should tell their doctor if they are pregnant or
plan to become pregnant (it is unknown if ORKAMBI will harm the
unborn baby) or if they are breastfeeding or planning to breastfeed
(it is unknown if ORKAMBI passes into breast milk).
ORKAMBI may affect the way other medicines work and other
medicines may affect how ORKAMBI works. Therefore, the dose of
ORKAMBI or other medicines may need to be adjusted when taken
together. Patients should especially tell their doctor if they
take: antifungal medicines such as ketoconazole, itraconazole,
posaconazole, or voriconazole; or antibiotics such as
telithromycin, clarithromycin, or erythromycin.
When taking ORKAMBI, patients should tell their doctor if
they stop ORKAMBI for more than 1 week as the doctor may need
to change the dose of ORKAMBI or other medicines the patient is
taking.
ORKAMBI can cause serious side effects, including:
Worsening of liver function in people with severe liver
disease. The worsening of liver function can be serious or cause
death. Patients should talk to their doctor if they have been told
they have liver disease as their doctor may need to adjust the dose
of ORKAMBI.
High liver enzymes in the blood, which can be a sign of
liver injury. The patient’s doctor will do blood tests to
check their liver before they start ORKAMBI, every three months
during the first year of taking ORKAMBI, and annually thereafter.
The patient should call the doctor right away if they have any of
the following symptoms of liver problems: pain or discomfort in the
upper right stomach (abdominal) area; yellowing of the skin or the
white part of the eyes; loss of appetite; nausea or vomiting; dark,
amber-colored urine; or confusion.
Breathing problems such as shortness of breath or chest
tightness in patients when starting ORKAMBI, especially in patients
who have poor lung function. If a patient has poor lung function,
their doctor may monitor them more closely when starting
ORKAMBI.
An increase in blood pressure in some people receiving
ORKAMBI. The patient’s doctor should monitor their blood pressure
during treatment with ORKAMBI.
Abnormality of the eye lens (cataract) in some children
and adolescents receiving ORKAMBI. For children and adolescents,
the patient’s doctor should perform eye examinations before and
during treatment with ORKAMBI to look for cataracts.
The most common side effects of ORKAMBI include:
breathing problems, such as shortness of breath and/or chest
tightness; nausea; diarrhea; gas; increase in a certain muscle
enzyme called creatinine phosphokinase; common cold, including sore
throat, stuffy or runny nose; fatigue; flu or flu-like symptoms;
rash; irregular, missed, or abnormal periods (menses) and increase
in the amount of menstrual bleeding.
Side effects seen in children are similar to those seen
in adults and adolescents. Additional common side effects seen in
children include: cough with sputum, stuffy nose, headache, stomach
pain, and increase in sputum.
Please click here to see the full Prescribing
Information for ORKAMBI.
About Vertex
Vertex is a global biotechnology company that invests in
scientific innovation to create transformative medicines for people
with serious and life-threatening diseases. In addition to clinical
development programs in CF, Vertex has more than a dozen ongoing
research programs focused on the underlying mechanisms of other
serious diseases.
Founded in 1989 in Cambridge, Mass., Vertex's headquarters is
now located in Boston's Innovation District. Today, the company has
research and development sites and commercial offices in the United
States, Europe, Canada and Australia. Vertex is consistently
recognized as one of the industry's top places to work, including
being named to Science magazine's Top Employers in the life
sciences ranking for eight years in a row.
For additional information and the latest updates from the
company, please visit www.vrtx.com.
Special Note Regarding Forward-Looking Statements
This press release contains forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995,
including, without limitation, Dr. Leiden's and Mr. Smith's
statements in this press release, the information provided in the
sections captioned "2018 Financial Guidance" and "Stock Repurchase
Program" and statements regarding (i) the timing and expected
outcome of regulatory applications, including NDAs and MAAs and
(ii) the development plan and timelines for our product development
candidates, including tezacaftor in combination with ivacaftor and
our next-generation triple combination regimens. While Vertex
believes the forward-looking statements contained in this press
release are accurate, these forward-looking statements represent
the company's beliefs only as of the date of this press release and
there are a number of factors that could cause actual events or
results to differ materially from those indicated by such
forward-looking statements. Those risks and uncertainties include,
among other things, that the company's expectations regarding its
2018 expenses may be incorrect (including because one or more of
the company's assumptions underlying its expectations may not be
realized), that data from the company's development programs may
not support registration or further development of its compounds
due to safety, efficacy or other reasons, and other risks listed
under Risk Factors in Vertex's annual report and quarterly reports
filed with the Securities and Exchange Commission and available
through the company's website at www.vrtx.com. Vertex disclaims any
obligation to update the information contained in this press
release as new information becomes available.
Conference Call and
Webcast
The company will host a conference call and webcast today at
4:30 p.m. ET. To access the call, please dial (866) 501-1537 (U.S.)
or +1 (720) 545-0001 (International). The conference call will be
webcast live and a link to the webcast can be accessed through
Vertex's website at www.vrtx.com in the "Investors" section under
"Events and Presentations." To ensure a timely connection, it is
recommended that users register at least 15 minutes prior to the
scheduled webcast. An archived webcast will be available on the
company's website.
(VRTX-E)
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version on businesswire.com: http://www.businesswire.com/news/home/20180131006107/en/
Vertex Contacts:Investors:Michael Partridge,
617-341-6108orEric Rojas, 617-961-7205orZach Barber,
617-341-6470orMedia:617-341-6992mediainfo@vrtx.com
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