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Financial Highlights ($ in millions, except per share data, unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||
2014 | 2013 | % Change | 2014 | 2013 | % Change | |
Total BioMarin Revenue | $ 176.8 | $ 136.9 | 29.1% | $ 520.3 | $ 401.6 | 29.6% |
VIMIZIM Net Product Revenue | 25.2 | -- | 40.4 | -- | ||
Naglazyme Net Product Revenue | 67.5 | 63.2 | 6.8% | 246.0 | 202.5 | 21.5% |
Kuvan Net Product Revenue | 53.4 | 43.6 | 22.5% | 145.6 | 122.1 | 19.2% |
Aldruazyme Net Product Revenue | 22.6 | 23.4 | -3.4% | 64.7 | 57.7 | 12.1% |
Aldruazyme Royalty Revenue | ||||||
(excluding Net Product Transfer Revenue) - non-GAAP | 22.9 | 20.5 | 11.7% | 69.1 | 61.0 | 13.3% |
Firdapse Net Product Revenue | 4.7 | 4.1 | 14.6% | 14.0 | 11.8 | 18.6% |
Non-GAAP Net Loss | $ (22.9) | $ (16.7) | $ (13.5) | $ (24.6) | ||
Non-GAAP Net Loss per Share - Basic | $ (0.16) | $ (0.12) | $ (0.09) | $ (0.18) | ||
Non-GAAP Net Loss per Share - Diluted | $ (0.16) | $ (0.12) | $ (0.09) | $ (0.18) | ||
GAAP Net Income (Loss) | $ 7.4 | $ (53.0) | $ (64.2) | $ (114.4) | ||
GAAP Net Income (Loss) per Share - Basic | $ 0.05 | $ (0.38) | $ (0.44) | $ (0.84) | ||
GAAP Net Income (Loss) per Share - Diluted | $ 0.05 | $ (0.38) | $ (0.44) | $ (0.84) | ||
Cash, cash equivalents and investments * | $ 1,114.7 | $ 1,052.4 | ||||
*Balances of cash, cash equivalents and investments are as of September 30, 2014 and December 31, 2013, respectively. |
SAN RAFAEL, Calif., Oct. 23, 2014 (GLOBE NEWSWIRE) -- BioMarin Pharmaceutical Inc. (Nasdaq:BMRN) today announced financial results for the third quarter ended September 30, 2014. Non-GAAP net loss was $22.9 million, or $0.16 per basic and diluted share for the third quarter of 2014, compared to non-GAAP net loss of $16.7 million for the third quarter of 2013. For the nine months ended September 30, 2014, non-GAAP net loss was $13.5 million, or $0.09 per basic and diluted share, compared to a non-GAAP net loss of $24.6 million for the nine months ended September 30, 2013. The increase in non-GAAP loss for the third quarter of 2014 compared to the prior year was primarily due to increased research and development expenses for talazoparib, BMN 190, BMN 270, BMN 250, BMN 701 and PEG PAL, as well as increased selling, general and administrative expenses related to VIMIZIM® launch activities. These increased expenses were partially offset by strong sales of VIMIZIM during its second full quarter of commercial sales.
GAAP net income was $7.4 million, or $0.05 per basic and diluted share for the third quarter of 2014, compared to GAAP net loss of $53.0 million, or $0.38 per basic and diluted share for the third quarter of 2013. GAAP net loss for the nine months ended September 30, 2014 was $64.2 million, or $0.44 per basic and diluted share, as compared to GAAP net loss of $114.4 million, or $0.84 per basic and diluted share for the nine months ended September 30, 2013. Increased GAAP net income in the third quarter of 2014, compared to the prior year quarter, was primarily due to proceeds from the one-time sale of the Company's Rare Pediatric Disease Priority Review Voucher (PRV) of $67.5 million pre-tax, in addition to the operating factors which affected non-GAAP loss.
As of September 30, 2014, BioMarin had cash, cash equivalents and investments totaling $1,114.7 million, as compared to $1,052.4 million on December 31, 2013.
"The commercial launch of VIMIZIM continues to make excellent progress. We are extremely pleased with the success of the U.S. launch and the progress we are making in the European Union seeking reimbursement for VIMIZIM on a country by country basis," said Jean-Jacques Bienaimé, Chief Executive Officer of BioMarin. "In addition, our more established commercial portfolio continues to grow, with both Naglazyme and Kuvan growing approximately 20% during the first three quarters of this year compared to last year. We believe that the continued growth of our five commercial products will help BioMarin reach over $1 billion in revenues over the next 2-3 years."
Net Product Revenue (unaudited)
Total Revenue Growth (in millions) | ||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2014 | 2013 | $ Change | % Change | 2014 | 2013 | $ Change | % Change | |
VIMIZIM | $ 25.2 | $ -- | $ 25.2 | -- | $ 40.4 | $ -- | $ 40.4 | -- |
Naglazyme (1) | 67.5 | 63.2 | 4.3 | 6.8% | 246.0 | 202.5 | 43.5 | 21.5% |
Kuvan | 53.4 | 43.6 | 9.8 | 22.5% | 145.6 | 122.1 | 23.5 | 19.2% |
Aldurazyme | 22.6 | 23.4 | (0.8) | -3.4% | 64.7 | 57.7 | 7.0 | 12.1% |
Firdapse | 4.7 | 4.1 | 0.6 | 14.6% | 14.0 | 11.8 | 2.2 | 18.6% |
Net product revenue | 173.4 | 134.3 | 39.1 | 29.1% | 510.7 | 394.1 | 116.6 | 29.6% |
Collaborative agreement revenue | 0.3 | 1.8 | (1.5) | 1.3 | 2.8 | (1.5) | ||
Royalty and license revenue | 3.1 | 0.8 | 2.3 | 8.3 | 4.7 | 3.6 | ||
Total BioMarin revenue - GAAP | 176.8 | 136.9 | 39.9 | 29.1% | 520.3 | 401.6 | 118.7 | 29.6% |
Less: Previously recognized Aldurazyme net product transfer revenue | (0.3) | 2.9 | (3.2) | (4.4) | (3.3) | (1.1) | ||
Total BioMarin revenues (excluding Aldurazyme net product transfer revenue) - Non-GAAP (2) | $ 177.1 | $ 134.0 | $ 43.1 | 32.2% | $ 524.7 | $ 404.9 | $ 119.8 | 29.6% |
Reconciliation of Aldurazyme Revenues (in millions) | ||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2014 | 2013 | $ Change | % Change | 2014 | 2013 | $ Change | % Change | |
Aldurazyme revenue reported by Genzyme | $ 54.3 | $ 50.8 | $ 3.5 | 6.9% | $ 172.5 | $ 152.9 | $ 19.6 | 12.8% |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2014 | 2013 | $ Change | 2014 | 2013 | $ Change | |||
Aldurazyme Royalties due from Genzyme - Non-GAAP (2) | $ 22.9 | $ 20.5 | $ 2.4 | $ 69.1 | $ 61.0 | $ 8.1 | ||
Previously recognized net product transfer revenue (3) | (0.3) | 2.9 | (3.2) | (4.4) | (3.3) | (1.1) | ||
Total Aldurazyme net product revenue - GAAP | $ 22.6 | $ 23.4 | $ (0.8) | $ 64.7 | $ 57.7 | $ 7.0 | ||
(1) Naglazyme revenues experience quarterly fluctuations due to the timing of government ordering patterns in certain countries. The Company does not believe these fluctuations reflect a change in underlying demand. | ||||||||
(2) BioMarin believes that this non-GAAP information is useful to investors, taken in conjunction with BioMarin's GAAP information because it provides additional information regarding the end-user demand for Aldurazyme. The Aldurazyme net product transfer revenue is the result of timing of deliveries to Genzyme Corp. and is therefore not representative of patient demand for the product. By providing information about both the GAAP and non-GAAP revenue measures, the Company believes that the additional information enhances investors' overall understanding of the Company's business and in particular allows for more consistent period to period evaluation of the revenue. | ||||||||
(3) To the extent units shipped to third party customers by Genzyme exceed BioMarin inventory transfers to Genzyme, BioMarin will record a decrease in net product revenue from the royalty payable to BioMarin for the amount of previously recognized product transfer revenue. If BioMarin inventory transfers exceed units shipped to third party customers by Genzyme, BioMarin will record incremental net product transfer revenue for the period. |
Revenue Guidance ($ in millions)
Item | Provided | Updated |
August 26, 2014 | October 23, 2014 | |
Total BioMarin Revenues | $680 to $700 | $700 to $710 |
Naglazyme Net Product Revenue | $305 to $320 | Unchanged |
Kuvan Net Product Revenue | $180 to $200 | $190 to $200 |
VIMIZIM | $60 to $70 | $65 to $70 |
Selected Income Statement Guidance ($ in millions, except percentages)
Item | Provided | Updated |
August 26, 2014 | October 23, 2014 | |
Cost of Sales (% of Total Revenue) | 16.5% to 17.5% | Unchanged |
Research and Development Expense | $460 to $480 | $455 to $470 |
Selling, General and Admin. Expense | $280 to $295 | Unchanged |
Non-GAAP Net Loss | $(60) to $(80) | $(50) to $(65) |
GAAP Net Loss | $(180) to $(195) | $(160) to $(175) |
Anticipated Upcoming Milestones
4Q 2014: Enrollment completion of Phase 1/2 trial with BMN 190 for the treatment of Batten disease |
1Q 2015: IND filing or equivalent for BMN 270 for the treatment of Hemophilia A |
2Q 2015: Data on first three cohorts in Phase 2 with BMN 111 for the treatment of Achondroplasia |
1H 2015: Enrollment completion of Phase 2/3 trial with BMN 701 for the treatment of Pompe disease |
2H 2015: Results from Phase 1/2 trial with BMN 190 for the treatment of Batten disease |
2H 2015: Results from Phase 2/3 trial with BMN 701 for the treatment of Pompe disease |
2H 2015: Enrollment completion of Phase 3 trial with talazoparib (BMN 673) for the treatment of mBC |
Mid-2015: IND filing or equivalent for BMN 250 for the treatment of MPS IIIB |
4Q 2015: Results from pivotal Phase 3 trial with PEG PAL for the treatment of PKU |
1Q 2016: Submission of PEG PAL BLA to the FDA for the treatment of PKU |
Advanced Clinical Programs
Preclinical Programs
Non-GAAP Net Income (Loss) and Reconciliation
The results for the three and nine months ended September 30, 2014 and September 30, 2013 and the guidance for 2014 include both GAAP net loss and non-GAAP net income/loss. As used in this release, non-GAAP net income/loss is based on GAAP earnings before interest, taxes, depreciation and amortization (EBITDA) and further adjusted to exclude certain non-cash items such as, stock compensation expense and certain nonrecurring material items.
The following table presents the reconciliation of GAAP to non-GAAP financial metrics:
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Loss | |||||
(in millions) | |||||
(unaudited) | |||||
Three Months Ended September 30, |
Nine Months Ended September 30, |
Year Ending December 31, 2014 |
|||
2014 | 2013 | 2014 | 2013 | Guidance | |
GAAP Net Income (Loss) | $ 7.4 | $ (53.0) | $ (64.2) | $ (114.4) | $(160.0) - $(175.0) |
Interest expense, net | 7.7 | -- | 23.2 | 1.0 | 31.1 |
Provision for (benefit from) income taxes | (4.2) | 0.7 | 5.0 | (2.8) | 14.6 |
Depreciation expense | 8.6 | 6.3 | 23.3 | 19.0 | 31.4 |
Amortization expense | 3.3 | 2.6 | 8.7 | 8.9 | 11.0 |
EBITDA Income (Loss) | 22.8 | (43.4) | (4.0) | (88.3) | (71.9) - (86.9) |
Stock-based compensation expense | 20.0 | 16.2 | 53.6 | 41.7 | 82.5 |
Contingent consideration expense (1) | 1.8 | 8.8 | 12.6 | 9.8 | 15.2 |
Non-recurring: | |||||
Gain on sale of intangible asset (2) | (67.5) | -- | (67.5) | -- | (67.5) |
Gain on termination of leases (3) | -- | -- | (8.9) | -- | (9.0) |
Debt conversion expense (4) | -- | 1.7 | 0.7 | 12.2 | 0.7 |
Non-GAAP Loss | $ (22.9) | $ (16.7) | $ (13.5) | $ (24.6) | $(50.0) - $(65.0) |
(1) Represents the expense associated with the change in the fair value of contingent acquisition consideration payable for the period, resulting from changes in estimated probabilities and timing of achieving certain developmental milestones. | |||||
(2) Represents the total sales price of $67.5 million for the PRV, or approximately $54.0 million net of tax. | |||||
(3) Primarily represents the net gain due to the early termination of the Company's operating lease and the realization of the remaining balance in deferred rent upon acquisition of the San Rafael Corporate Center where the Company's corporate headquarters are located, as well as early termination of certain other leases related to the Company's facilities. | |||||
(4) Represents debt conversion expense associated with the early conversion of a portion of our 2017 convertible notes. |
BioMarin believes that this non-GAAP information is useful to investors, taken in conjunction with BioMarin's GAAP information because it provides additional information regarding the performance of BioMarin's core ongoing business, VIMIZIM, Naglazyme, Kuvan, Aldurazyme and Firdapse, and development of the Company's pipeline. By providing information about both the overall GAAP financial performance and the non-GAAP measures that focus on continuing operations, the Company believes that the additional information enhances investors' overall understanding of the Company's business and prospects for the future. Further, the Company uses both the GAAP and the non-GAAP results and expectations internally for its operating, budgeting and financial planning purposes.
Conference Call Details
BioMarin will host a conference call and webcast to discuss third quarter 2014 financial results today, Thursday, October 23, at 4:30 p.m. ET. This event can be accessed on the investor section of the BioMarin website at www.BMRN.com.
U.S. / Canada Dial-in Number: 877.303.6313
International Dial-in Number: 631.813.4734
Conference ID: 11300960
Replay Dial-in Number: 855.859.2056
Replay International Dial-in Number: 404.537.3406
Conference ID: 11300960
About BioMarin
BioMarin develops and commercializes innovative biopharmaceuticals for serious diseases and medical conditions. The company's product portfolio comprises five approved products and multiple clinical and pre-clinical product candidates. Approved products include: Naglazyme® (galsulfase) for mucopolysaccharidosis VI (MPS VI), a product wholly developed and commercialized by BioMarin; Aldurazyme® (laronidase) for mucopolysaccharidosis I (MPS I), a product which BioMarin developed through a 50/50 joint venture with Genzyme Corporation; KUVAN® (sapropterin dihydrochloride) Powder for Oral Solution and Tablets, for phenylketonuria (PKU), developed in partnership with Merck Serono, a division of Merck KGaA of Darmstadt, Germany; Firdapse® (amifampridine), which has been approved by the European Commission for the treatment of Lambert Eaton Myasthenic Syndrome (LEMS); and VIMIZIM® (elosulfase alfa) for the treatment of Morquio A (MPS IVA). Product candidates include: BMN 165 (PEGylated recombinant phenylalanine ammonia lyase), also referred to as PEG PAL, which is currently in Phase 3 clinical development for the treatment of PKU; talazoparib (BMN 673), a poly ADP-ribose polymerase (PARP) inhibitor, which is currently in Phase 3 clinical development for the treatment of germline BRCA breast cancer; BMN 701, a novel fusion of acid alpha glucosidase (GAA) with a peptide derived from insulin like growth factor 2, which is currently in Phase 3 clinical development for the treatment of Pompe disease; BMN 111, a modified C-natriuretic peptide, which is currently in Phase 2 clinical development for the treatment of achondroplasia; and BMN 190, a recombinant human tripeptidyl peptidase-1 (rhTPP1), which is currently in Phase 1 for the treatment of late-infantile neuronal ceroid lipofuscinosis (CLN2), a form of Batten Disease. For additional information, please visit www.BMRN.com. Information on BioMarin's website is not incorporated by reference into this press release.
Forward-Looking Statement
This press release contains forward-looking statements about the business prospects of BioMarin Pharmaceutical Inc., including, without limitation, statements about: the expectations of revenue and sales related to VIMIZIM, Naglazyme, Kuvan, Aldurazyme and Firdapse; the financial performance of BioMarin as a whole; the timing of BioMarin's clinical trials of PEG PAL, talazoparib (BMN 673), BMN 701, BMN 111, BMN 190, BMN 270, BMN 250 and other product candidates; the continued clinical development and commercialization of Aldurazyme, Naglazyme, Kuvan, Firdapse, VIMIZIM and its product candidates; and actions by regulatory authorities. These forward-looking statements are predictions and involve risks and uncertainties such that actual results may differ materially from these statements. These risks and uncertainties include, among others: our success in the commercialization of VIMIZIM, Naglazyme, Kuvan, and Firdapse; Genzyme Corporation's success in continuing the commercialization of Aldurazyme; results and timing of current and planned preclinical studies and clinical trials, particularly with respect to PEG PAL, talazoparib (BMN 673), BMN 701, BMN 111 and BMN 190; our ability to successfully manufacture our products and product candidates; the content and timing of decisions by the U.S. Food and Drug Administration, the European Commission and other regulatory authorities concerning each of the described products and product candidates; the market for each of these products and particularly Aldurazyme, Naglazyme, Kuvan, VIMIZIM and Firdapse; actual sales of Aldurazyme, Naglazyme, Kuvan, VIMIZIM and Firdapse; Merck Serono's activities related to Kuvan; and those factors detailed in BioMarin's filings with the Securities and Exchange Commission, including, without limitation, the risk factors contained under the caption "Risk Factors" in BioMarin's 2013 Annual Report on Form 10-K, and the factors contained in BioMarin's reports on Form 10-Q. Stockholders are urged not to place undue reliance on forward-looking statements, which speak only as of the date hereof. BioMarin is under no obligation, and expressly disclaims any obligation to update or alter any forward-looking statement, whether as a result of new information, future events or otherwise.
BioMarin®, VIMIZIM®, Naglazyme®, Kuvan®, and Firdapse® are registered trademarks of BioMarin Pharmaceutical Inc.
Aldurazyme® is a registered trademark of BioMarin/Genzyme LLC.
BIOMARIN PHARMACEUTICAL INC. | ||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
September 30, 2014 and December 31, 2013 | ||
(In thousands of U.S. dollars, except share and per share amounts) | ||
September 30, | December 31, | |
2014 | 2013(1) | |
ASSETS | (unaudited) | |
Current assets: | ||
Cash and cash equivalents | $ 398,005 | $ 568,781 |
Short-term investments | 268,368 | 215,942 |
Accounts receivable, net (allowance for doubtful accounts: $195 and $529, respectively) | 121,395 | 117,822 |
Inventory | 204,444 | 162,605 |
Current deferred tax assets | 29,149 | 30,561 |
Other current assets | 56,458 | 41,707 |
Total current assets | 1,077,819 | 1,137,418 |
Noncurrent assets: | ||
Investment in BioMarin/Genzyme LLC | 815 | 816 |
Long-term investments | 448,328 | 267,700 |
Property, plant and equipment, net | 486,741 | 319,316 |
Intangible assets, net | 159,949 | 163,147 |
Goodwill | 54,258 | 54,258 |
Long-term deferred tax assets | 150,991 | 145,234 |
Other assets | 61,532 | 156,171 |
Total assets | $ 2,440,433 | $ 2,244,060 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Current liabilities: | ||
Accounts payable and accrued liabilities | $ 206,550 | $ 183,271 |
Total current liabilities | 206,550 | 183,271 |
Noncurrent liabilities: | ||
Long-term convertible debt | 656,884 | 655,566 |
Long-term contingent acquisition consideration payable | 42,297 | 30,790 |
Other long-term liabilities | 26,260 | 33,392 |
Total liabilities | 931,991 | 903,019 |
Stockholders' equity: | ||
Common stock, $0.001 par value: 250,000,000 shares authorized at September 30, 2014 and December 31, 2013; 147,933,951 and 143,463,668 shares issued and outstanding at September 30, 2014 and December 31, 2013, respectively. |
148 | 144 |
Additional paid-in capital | 2,278,761 | 2,059,101 |
Company common stock held by Nonqualified Deferred Compensation Plan | (9,683) | (7,421) |
Accumulated other comprehensive income | 19,189 | 5,018 |
Accumulated deficit | (779,973) | (715,801) |
Total stockholders' equity | 1,508,442 | 1,341,041 |
Total liabilities and stockholders' equity | $ 2,440,433 | $ 2,244,060 |
(1) December 31, 2013 balances were derived from the audited consolidated financial statements. |
BIOMARIN PHARMACEUTICAL INC. | ||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||
Three and Nine Months Ended September 30, 2014 and 2013 | ||||
(In thousands of U.S. dollars, except per share amounts) | ||||
(Unaudited) | ||||
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||
2014 | 2013 | 2014 | 2013 | |
REVENUES: | ||||
Net product revenues | $ 173,416 | $ 134,330 | $ 510,664 | $ 394,074 |
Collaborative agreement revenues | 353 | 1,754 | 1,274 | 2,778 |
Royalty, license and other revenues | 3,078 | 790 | 8,248 | 4,760 |
Total revenues | 176,847 | 136,874 | 520,186 | 401,612 |
OPERATING EXPENSES: | ||||
Cost of sales (excludes amortization of certain acquired intangible assets) | 29,920 | 28,054 | 83,946 | 71,121 |
Research and development | 125,686 | 88,064 | 319,554 | 257,468 |
Selling, general and administrative | 74,604 | 61,841 | 202,524 | 163,547 |
Intangible asset amortization and contingent consideration | 2,934 | 9,639 | 15,797 | 13,173 |
Gain on sale of intangible asset | (67,500) | -- | (67,500) | -- |
Total operating expenses | 165,644 | 187,598 | 554,321 | 505,309 |
INCOME (LOSS) FROM OPERATIONS | 11,203 | (50,724) | (34,135) | (103,697) |
Equity in the loss of BioMarin/Genzyme LLC | (225) | (147) | (1,102) | (711) |
Interest income | 1,435 | 574 | 4,293 | 1,942 |
Interest expense | (9,118) | (526) | (27,445) | (2,854) |
Debt conversion expense | -- | (1,732) | (674) | (12,152) |
Other income (expense) | (74) | 239 | (68) | 344 |
INCOME (LOSS) BEFORE INCOME TAXES | 3,221 | (52,316) | (59,131) | (117,128) |
Provision for (benefit from) income taxes | (4,224) | 704 | 5,041 | (2,765) |
NET INCOME (LOSS) | $ 7,445 | $ (53,020) | $ (64,172) | $ (114,363) |
NET INCOME (LOSS) PER SHARE, BASIC | $ 0.05 | $ (0.38) | $ (0.44) | $ (0.84) |
NET INCOME (LOSS) PER SHARE, DILUTED | $ 0.05 | $ (0.38) | $ (0.44) | $ (0.84) |
Weighted average common shares outstanding, basic | 147,016 | 140,796 | 145,724 | 136,102 |
Weighted average common shares outstanding, diluted | 159,304 | 140,796 | 145,724 | 136,102 |
COMPREHENSIVE INCOME (LOSS) | $ 16,693 | $ (43,988) | $ (50,001) | $ (102,688) |
STOCK-BASED COMPENSATION EXPENSE | ||||
Total stock-based compensation expense included in the Condensed Consolidated Statements of Comprehensive Income (Loss) was as follows (unaudited): | ||||
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||
2014 | 2013 | 2014 | 2013 | |
Cost of sales | $ 1,180 | $ 1,489 | $ 3,807 | $ 3,663 |
Research and development | 8,279 | 7,116 | 22,300 | 18,821 |
Selling, general and administrative | 10,545 | 7,600 | 27,452 | 19,214 |
$ 20,004 | $ 16,205 | $ 53,559 | $ 41,698 |
CONTACT: Investors: Traci McCarty BioMarin Pharmaceutical Inc. (415) 455-7558 Media: Debra Charlesworth BioMarin Pharmaceutical Inc. (415) 455-7451