- Third Quarter 2016 Total BioMarin
Revenues Increase 34% Year over Year to $280 million
BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) today announced
financial results for the third quarter ended September 30, 2016.
GAAP net loss was $43 million, or $(0.26) per basic and diluted
share, for the third quarter of 2016, compared to GAAP net loss of
$91 million, or $(0.57) and $(0.60) per basic and diluted share,
respectively, for the third quarter of 2015. Non-GAAP income was $3
million for the quarter ended September 30, 2016, compared to
non-GAAP loss of $41 million for the third quarter of 2015.
The change in GAAP net loss and non-GAAP income
and loss compared to the prior year quarter was primarily due to
increased gross margins from Naglazyme, Kuvan and Vimizim net
product revenues, partially offset by increased selling, general
and administrative expenses for Vimizim and Kuvan.
Total BioMarin Revenues were $280 million for
the third quarter of 2016, an increase of 34% compared to the same
period in 2015. Vimizim net product revenues increased to $81
million, a 25% year over year increase. Patients on therapy for
Vimizim increased 46% year over year. The decrease in Vimizim net
product revenues quarter to quarter was attributable to forward
buying in Latin America and the Middle East in the second quarter
of 2016. Naglazyme net product revenues increased to $78 million, a
44%, year over year increase, due to the timing of central
government orders from Latin America in the current quarter.
Naglazyme patients on therapy continue to show consistent growth
with an increase of 10% year over year. Kuvan net product
revenues increased to $91 million, a 42% year over year increase,
including $71 million contributed from revenue in North America due
to a 15% increase in patients on therapy, and $20 million
contributed from net product revenues in the newly acquired
ex-North American territories.
As of September 30, 2016, BioMarin had cash,
cash equivalents and investments totaling $1.4 billion, which
includes $713 million of net proceeds from the August 12, 2016
public offering, as compared to $1.0 billion on December 31,
2015.
Commenting on the quarter, Jean-Jacques
Bienaimé, Chairman and Chief Executive Officer of BioMarin, said,
“In the third quarter of 2016 we shared proof-of-concept data from
our BMN 270 gene therapy program for the treatment of Hemophilia A,
currently the only factor VIII product in clinical development in
this indication. In addition, our regulatory filings for
approval of Brineura, for the treatment of Batten disease, were
accepted and validated in both the U.S. and EU. With the
Prescription Drug User Fee Act (PDUFA) goal date for an FDA
approval decision of April 27, 2017, we hope to have an approved
treatment option for this devastating childhood disease in the near
future.”
Mr. Bienaimé continued, “In addition, just last
week we announced the results of the 30µg/kg dose cohort from our
Phase 2 study with vosoritide in achondroplasia, which demonstrated
similar efficacy as the lower dose of 15µg/kg. Based on these
results, we intend to initiate a one-year, randomized,
placebo-controlled Phase 3 study in children with achondroplasia
ages 5-14 at the 15µg/kg dose with a subsequent open-label
extension by year-end. If the data from both the vosoritide
and BMN 270 gene therapy programs continue to mature as we hope, we
believe that each of these product candidates has the potential to
ultimately drive a billion dollars in annual revenue, if approved
and successfully commercialized.”
Net Product Revenues (in millions of
U.S. dollars, unaudited)
Total BioMarin Revenues
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2016 |
|
|
2015 |
|
|
$ Change |
|
|
% Change |
|
|
2016 |
|
|
2015 |
|
|
$ Change |
|
|
% Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vimizim (1) |
|
$ |
81 |
|
|
$ |
65 |
|
|
$ |
16 |
|
|
|
25 |
% |
|
$ |
260 |
|
|
$ |
170 |
|
|
$ |
90 |
|
|
|
53 |
% |
Naglazyme (1) |
|
|
78 |
|
|
|
54 |
|
|
|
24 |
|
|
|
44 |
% |
|
|
222 |
|
|
|
243 |
|
|
|
(21 |
) |
|
|
(9 |
)% |
Kuvan (2) |
|
|
91 |
|
|
|
64 |
|
|
|
27 |
|
|
|
42 |
% |
|
|
258 |
|
|
|
175 |
|
|
|
83 |
|
|
|
47 |
% |
Aldurazyme |
|
|
24 |
|
|
|
21 |
|
|
|
3 |
|
|
|
14 |
% |
|
|
59 |
|
|
|
59 |
|
|
|
— |
|
|
|
— |
|
Firdapse |
|
|
4 |
|
|
|
4 |
|
|
|
— |
|
|
|
— |
|
|
|
13 |
|
|
|
11 |
|
|
|
2 |
|
|
|
18 |
% |
Net
product revenues |
|
$ |
278 |
|
|
$ |
208 |
|
|
$ |
70 |
|
|
|
34 |
% |
|
$ |
812 |
|
|
$ |
658 |
|
|
$ |
154 |
|
|
|
23 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collaborative, royalty,
license and other revenues |
|
$ |
2 |
|
|
$ |
1 |
|
|
$ |
1 |
|
|
|
|
|
|
$ |
5 |
|
|
$ |
4 |
|
|
$ |
1 |
|
|
|
|
|
Total
BioMarin Revenues |
|
$ |
280 |
|
|
$ |
209 |
|
|
$ |
71 |
|
|
|
34 |
% |
|
$ |
817 |
|
|
$ |
662 |
|
|
$ |
155 |
|
|
|
23 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Vimizim and Naglazyme net product revenues
experience quarterly fluctuations primarily 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) North America contributed $71 million in the third
quarter with an additional $20 million coming from the newly
acquired ex-North American territories.
Details of Net Product Revenues
Attributable to Aldurazyme
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2016 |
|
|
2015 |
|
|
$ Change |
|
|
% Change |
|
|
2016 |
|
|
2015 |
|
|
$ Change |
|
|
% Change |
|
Aldurazyme revenue
reported by Genzyme |
|
$ |
59 |
|
|
$ |
54 |
|
|
$ |
5 |
|
|
|
9 |
% |
|
$ |
169 |
|
|
$ |
164 |
|
|
$ |
5 |
|
|
|
3 |
% |
|
|
Three Months Ended September 30, |
|
|
|
|
Nine Months Ended September 30, |
|
|
|
2016 |
|
|
2015 |
|
|
$ Change |
|
|
|
|
2016 |
|
|
2015 |
|
|
$ Change |
|
Royalties earned from
Genzyme |
|
$ |
27 |
|
|
$ |
23 |
|
|
$ |
4 |
|
|
|
|
$ |
71 |
|
|
$ |
69 |
|
|
$ |
2 |
|
Net product transfer
revenues (3) |
|
$ |
(3 |
) |
|
$ |
(2 |
) |
|
$ |
(1 |
) |
|
|
|
$ |
(12 |
) |
|
$ |
(10 |
) |
|
$ |
(2 |
) |
Total
Aldurazyme net product revenues |
|
$ |
24 |
|
|
$ |
21 |
|
|
$ |
3 |
|
|
|
|
$ |
59 |
|
|
$ |
59 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 revenues
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 revenues for
the period. Positive net product transfer revenues result in the
period if BioMarin transferred more units to Genzyme than Genzyme
sold to third-party customers.
Updated 2016 Financial
Guidance
Revenue Guidance ($ in millions)
Item |
|
|
|
|
|
|
Provided August
4, 2016 |
|
Updated October
27, 2016 |
Total BioMarin Revenues |
|
$1,100 to $1,150 |
|
Unchanged |
Vimizim Net Product Revenues |
|
$340 to $360 |
|
Unchanged |
Naglazyme Net Product Revenues |
|
$290 to $320 |
|
Unchanged |
Kuvan Net Product Revenues |
|
$340 to $360 |
|
Unchanged |
Select Income Statement Guidance ($ in millions,
except percentages)
Item |
|
|
|
|
|
|
Provided August
4, 2016 |
|
Updated October
27, 2016 |
Cost of Sales (% of Total BioMarin Revenues) |
|
18.0% to 19.0% |
|
Unchanged |
Selling, General and Admin. Expense |
|
$470 to $490 |
|
$460 to $480 |
Research and Development Expense |
|
$670 to $690 |
|
$650 to $670 |
GAAP Net Loss |
|
$(620) to $(650) |
|
$(600) to $(630) |
non-GAAP Loss |
|
$(30) to $(50) |
|
$(10) to $(30) |
Recent Key Program
Updates
- BMN 270 gene therapy product for hemophilia A:
On October 13, 2016, the Company announced that the Medicines and
Healthcare products Regulatory Agency (MHRA) in the United Kingdom
approved continued enrollment into the open-label Phase 1/2 study
of BMN 270. BioMarin had previously announced that after
enrolling the first nine patients in the study, that dosing of
patients had been suspended due to observed increases in ALT levels
that exceeded a pre- specified threshold set by the Company. The
agency also approved the Company’s proposed amendments to the
study, which included eliminating the requirement for prophylactic
corticosteroids and increasing potential additional enrollment from
up to three additional patients to up to six additional
patients. Based on protocol amendments agreed to with the
MHRA three patients will be enrolled at a dose of 4 x 1013 vg/kg,
and an additional three may be enrolled at this dose or the
previously tested high dose of 6 x 1013 vg/kg. In the up to
six additional patients, the threshold for starting therapeutic
corticosteroids has been increased. BioMarin intends to
provide an update on the ongoing Phase 1/2 study in December
2016. Safety and efficacy data from these patients will
inform the Phase 2b study planned to begin in the second half of
2017.
- Vosoritide for achondroplasia: On October 19,
2016, the Company provided an update on its Phase 2 study of
vosoritide, an analog of C-type Natriuretic Peptide (CNP), in
children with achondroplasia, the most common form of dwarfism, at
the American Society of Human Genetics 2016 Meeting. Results
from eight children in cohort 4, who completed six months of daily
dosing at 30 µg/kg/daily experienced a 46% or 2.1 cm/year increase
in mean annualized growth velocity from baseline (p-value = 0.03).
These data are comparable to those observed at the lower dose of 15
µg/kg/day in cohort 3. Results from 10 children in cohort 3,
who completed six months of daily dosing at 15 µg/kg/day
experienced a 50% or 2.0 cm/year increase in mean annualized growth
velocity from baseline (p-value = 0.01). Based on these data,
the Company intends to initiate a one-year, randomized,
placebo-controlled Phase 3 study in children with achondroplasia
ages 5-14 with a subsequent open-label extension by year-end with
the 15 µg/kg/day dose. Children in this study will have
completed a minimum six-month natural history study to determine
their respective baseline growth velocity prior to entering the
Phase 3 study.
- Brineura for CLN2, late-infantile form of Batten
disease: During the quarter, the Company announced that
the U.S. Food and Drug Administration (FDA) had accepted for review
the submission of a Biologics License Application (BLA) for
Brineura, an investigational therapy to treat children with CLN2
disease, a form of Batten disease. The Prescription Drug User Fee
Act (PDUFA) goal date for a decision is April 27, 2017. The FDA
granted Brineura Priority Review status, which is designated for
drugs that offer major advances in treatment or provide a treatment
where no adequate therapy exists. Brineura was previously granted
Orphan Drug Designation and Breakthrough Therapy Designation by the
FDA. BioMarin also received validation of the Marketing
Authorization Application (MAA) to the European Medicines Agency
(EMA) for Brineura. Assuming a positive opinion from the CHMP and
standard assessment timing, a decision from the European Commission
is anticipated by the third quarter of 2017. The EMA previously
granted Brineura Orphan Drug Designation.
- Pegvaliase for phenylketonuria (PKU): Pivotal
results for the Phase 3 PRISM-2 study (formerly referred to as
165-302) that pegvaliase met the primary endpoint of change in
blood phe compared with placebo (p<0.0001) were announced in the
first quarter of 2016. The pegvaliase treated group maintained mean
blood phe levels at 527.2 umol/L compared to their Randomized
Discontinuation Trial (RDT) baseline of 503.9 umol/L, whereas the
placebo treated group mean blood phe levels increased to 1385.7
umol/L compared to their RDT baseline of 536.0 umol/L. The
treatment effect demonstrated in this study represents an
approximately 62% improvement in blood phe compared to placebo.
Based on the supportive data results, the Company plans to submit a
BLA to the FDA in the first quarter of 2017.
Conference Call Details
BioMarin will host a conference call and webcast
to discuss third quarter 2016 financial results today, Thursday,
October 27, 2016 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:
877.303.6313International Dial-in Number: 631.813.4734Conference
ID: 96042296
Replay Dial-in Number: 855.859.2056Replay
International Dial-in Number: 404.537.3406Conference ID:
96042296
About BioMarinBioMarin is a
global biotechnology company that develops and commercializes
innovative therapies for patients with serious and life-threatening
rare and ultra-rare genetic diseases. The Company's portfolio
consists of five commercialized products and multiple clinical and
pre-clinical product candidates. For additional information, please
visit www.BMRN.com.
Forward-Looking StatementThis
press release contains forward-looking statements about the
business prospects of BioMarin Pharmaceutical Inc., including,
without limitation, statements about: the expectations of revenue
and expenses related to Vimizim, Naglazyme, Kuvan, Firdapse, and
Aldurazyme and BioMarin’s product candidates, including vosoritide
and BMN 270; the financial performance of the BioMarin as a whole;
the timing of BioMarin's clinical trials; the continued clinical
development and commercialization of Vimizim, Naglazyme, Kuvan,
Firdapse, Aldurazyme and BioMarin’s product candidates; the
possible approval and commercialization of BioMarin’s 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, our ability to
successfully manufacture our products and product candidates; the
content and timing of decisions by the FDA, the European Commission
and other regulatory authorities concerning each of the described
products and product candidates; the market for each of these
products; actual sales of Vimizim, Naglazyme, Kuvan, Firdapse and
Aldurazyme; and those factors detailed in BioMarin's filings with
the Securities and Exchange Commission, including, without
limitation, the factors contained under the caption "Risk Factors"
in BioMarin's 2015 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®, Naglazyme®, Kuvan®, Firdapse® and
Vimizim® are registered trademarks of BioMarin Pharmaceutical Inc.,
or its affiliates. BrineuraTM is a trademarks of BioMarin
Pharmaceutical Inc. Aldurazyme® is a registered trademark of
BioMarin/Genzyme LLC.
|
|
BIOMARIN PHARMACEUTICAL INC. |
|
|
|
CONDENSED CONSOLIDATED BALANCE
SHEETS |
|
September 30, 2016 and December 31,
2015 |
|
(In thousands of U.S. dollars, except share and
per share amounts) |
|
|
|
|
|
September 30, |
|
|
December 31, |
|
|
|
2016 |
|
|
2015(1) |
|
ASSETS |
|
(unaudited) |
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
707,349 |
|
|
$ |
397,040 |
|
Short-term
investments |
|
|
327,499 |
|
|
|
195,579 |
|
Accounts
receivable, net (allowance for doubtful accounts: $66 and
$93, at September 30, 2016 and December 31, 2015,
respectively) |
|
|
215,894 |
|
|
|
164,959 |
|
Inventory |
|
|
347,420 |
|
|
|
271,683 |
|
Other
current assets |
|
|
68,409 |
|
|
|
60,378 |
|
Total
current assets |
|
|
1,666,571 |
|
|
|
1,089,639 |
|
Noncurrent assets: |
|
|
|
|
|
|
|
|
Long-term
investments |
|
|
362,956 |
|
|
|
425,652 |
|
Property,
plant and equipment, net |
|
|
729,836 |
|
|
|
704,207 |
|
Intangible
assets, net |
|
|
561,387 |
|
|
|
683,996 |
|
Goodwill |
|
|
197,039 |
|
|
|
197,039 |
|
Deferred tax
assets |
|
|
288,006 |
|
|
|
220,191 |
|
Other
assets |
|
|
36,443 |
|
|
|
408,644 |
|
Total
assets |
|
$ |
3,842,238 |
|
|
$ |
3,729,368 |
|
LIABILITIES AND STOCKHOLDERS’
EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities |
|
$ |
306,129 |
|
|
$ |
392,511 |
|
Short-term
convertible debt, net |
|
|
22,460 |
|
|
|
— |
|
Short-term
contingent acquisition consideration payable |
|
|
48,746 |
|
|
|
52,946 |
|
Total
current liabilities |
|
|
377,335 |
|
|
|
445,457 |
|
Noncurrent
liabilities: |
|
|
|
|
|
|
|
|
Long-term
convertible debt, net |
|
|
653,178 |
|
|
|
662,286 |
|
Long-term
contingent acquisition consideration payable |
|
|
122,644 |
|
|
|
32,663 |
|
Deferred tax
liabilities |
|
|
— |
|
|
|
143,527 |
|
Other
long-term liabilities |
|
|
43,273 |
|
|
|
44,588 |
|
Total
liabilities |
|
|
1,196,430 |
|
|
|
1,328,521 |
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Common
stock, $0.001 par value: 250,000,000 shares authorized at
September 30, 2016 and December 31, 2015: 171,697,649 and
161,526,044 shares issued and outstanding at September 30,
2016 and December 31, 2015, respectively |
|
|
173 |
|
|
|
162 |
|
Additional
paid-in capital |
|
|
4,231,514 |
|
|
|
3,414,837 |
|
Company
common stock held by Nonqualified Deferred Compensation Plan |
|
|
(14,969 |
) |
|
|
(13,616 |
) |
Accumulated
other comprehensive income |
|
|
2,158 |
|
|
|
21,033 |
|
Accumulated
deficit |
|
|
(1,573,068 |
) |
|
|
(1,021,569 |
) |
Total
stockholders’ equity |
|
|
2,645,808 |
|
|
|
2,400,847 |
|
Total
liabilities and stockholders’ equity |
|
$ |
3,842,238 |
|
|
$ |
3,729,368 |
|
|
|
|
|
|
|
|
|
|
(1) December 31, 2015 balances were derived from the audited
Consolidated Financial Statements included in the Company's Annual
Report on Form 10-K for the year ended December 31, 2015, filed
with the U.S. Securities and Exchange Commission on February 29,
2016.
|
|
BIOMARIN PHARMACEUTICAL INC. |
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
Three and Nine months Ended September 30, 2016
and 2015 |
|
(In thousands of U.S. dollars, except per
share amounts) |
|
(Unaudited) |
|
|
|
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
REVENUES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net product
revenues |
|
$ |
278,262 |
|
|
$ |
207,767 |
|
|
$ |
812,195 |
|
|
$ |
658,102 |
|
Collaborative agreement revenues |
|
|
1 |
|
|
|
131 |
|
|
|
234 |
|
|
|
849 |
|
Royalty,
license and other revenues |
|
|
1,633 |
|
|
|
1,006 |
|
|
|
4,334 |
|
|
|
3,008 |
|
Total
revenues |
|
|
279,896 |
|
|
|
208,904 |
|
|
|
816,763 |
|
|
|
661,959 |
|
OPERATING
EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales |
|
|
50,738 |
|
|
|
34,904 |
|
|
|
145,473 |
|
|
|
103,965 |
|
Research and
development |
|
|
160,831 |
|
|
|
158,713 |
|
|
|
486,663 |
|
|
|
458,688 |
|
Selling,
general and administrative |
|
|
118,758 |
|
|
|
94,044 |
|
|
|
333,635 |
|
|
|
288,364 |
|
Intangible
asset amortization and contingent consideration |
|
|
9,654 |
|
|
|
3,116 |
|
|
|
(34,318 |
) |
|
|
22,963 |
|
Impairment
of intangible assets |
|
|
— |
|
|
|
— |
|
|
|
599,118 |
|
|
|
— |
|
Total
operating expenses |
|
|
339,981 |
|
|
|
290,777 |
|
|
|
1,530,571 |
|
|
|
873,980 |
|
LOSS FROM
OPERATIONS |
|
|
(60,085 |
) |
|
|
(81,873 |
) |
|
|
(713,808 |
) |
|
|
(212,021 |
) |
Equity in the loss of
BioMarin/Genzyme LLC |
|
|
(104 |
) |
|
|
(186 |
) |
|
|
(374 |
) |
|
|
(539 |
) |
Interest income |
|
|
1,633 |
|
|
|
1,344 |
|
|
|
4,561 |
|
|
|
3,050 |
|
Interest expense |
|
|
(9,980 |
) |
|
|
(9,447 |
) |
|
|
(29,767 |
) |
|
|
(28,911 |
) |
Debt conversion
expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(163 |
) |
Other income
(expense) |
|
|
1,723 |
|
|
|
(281 |
) |
|
|
504 |
|
|
|
(9,105 |
) |
LOSS BEFORE INCOME
TAXES |
|
|
(66,813 |
) |
|
|
(90,443 |
) |
|
|
(738,884 |
) |
|
|
(247,689 |
) |
Provision for (benefit
from) income taxes |
|
|
(24,016 |
) |
|
|
483 |
|
|
|
(187,385 |
) |
|
|
(7,273 |
) |
NET
LOSS |
|
$ |
(42,797 |
) |
|
$ |
(90,926 |
) |
|
$ |
(551,499 |
) |
|
$ |
(240,416 |
) |
NET LOSS PER
SHARE, BASIC |
|
$ |
(0.26 |
) |
|
$ |
(0.57 |
) |
|
$ |
(3.36 |
) |
|
$ |
(1.51 |
) |
NET LOSS PER
SHARE, DILUTED |
|
$ |
(0.26 |
) |
|
$ |
(0.60 |
) |
|
$ |
(3.37 |
) |
|
$ |
(1.51 |
) |
Weighted average common
shares outstanding, basic |
|
|
167,714 |
|
|
|
160,886 |
|
|
|
163,963 |
|
|
|
159,647 |
|
Weighted average common
shares outstanding, diluted |
|
|
167,714 |
|
|
|
161,134 |
|
|
|
164,216 |
|
|
|
159,647 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Information
The results presented in this press release for
the three and nine months ended September 30, 2016 and 2015 include
both GAAP information and non-GAAP information. As used in this
release, non-GAAP income (loss) is based on reported GAAP net loss
and the guidance for full-year GAAP net loss before interest,
income taxes, depreciation and amortization and further adjusted to
exclude non-cash stock-based compensation expense, non-cash
contingent consideration expense and certain other specified items,
as detailed below. In addition, BioMarin includes in this press
release the effects of these adjustments on certain components of
GAAP net loss for each of the periods presented. In this regard,
non-GAAP income (loss) and its components, including non-GAAP Cost
of sales, non-GAAP Research and development expenses, non-GAAP
Selling, general and administrative expense, non-GAAP intangible
asset amortization and contingent consideration, non-GAAP Other
income (expense) and non-GAAP Provision for (benefit from) income
taxes are statement of operations line items prepared on the same
basis as, and therefore components of, the overall non-GAAP
measures.
BioMarin regularly uses both GAAP and non-GAAP
results and expectations internally to assess the Company’s core
operating performance, as support for budgeting and financial
planning purposes and to evaluate key business decisions. Because
non-GAAP income (loss) and its components are important internal
measurements for BioMarin, the Company believes that providing this
information in conjunction with BioMarin’s GAAP information
enhances investors’ understanding because it provides additional
information regarding the performance of BioMarin’s core operating
results and business and development of its pipeline.
Non-GAAP income (loss) and its components are
not meant to be considered in isolation or as a substitute for
comparable GAAP measures and should be read in conjunction with the
consolidated financial information prepared in accordance with
GAAP. Investors should note that the non-GAAP information is not
prepared under any comprehensive set of accounting rules or
principles and does not reflect all of the amounts associated with
the Company’s results of operations as determined in accordance
with GAAP. Investors should also note that these non-GAAP measures
have no standardized meaning prescribed by GAAP and, therefore,
have limits in their usefulness to investors. In addition, from
time to time in the future there may be other items that the
Company may exclude for purposes of its non-GAAP measures;
likewise, the Company may in the future cease to exclude items that
it has historically excluded for purposes of its non-GAAP measures.
Because of the non-standardized definitions, the non-GAAP measure
as used by BioMarin in this press release and the accompanying
tables may be calculated differently from, and therefore may not be
directly comparable to, similarly titled measures used by other
companies.
The following table presents the reconciliation
of GAAP Net Loss to non-GAAP Income (Loss):
Reconciliation of GAAP Net Loss to non-GAAP
Income (Loss) |
(In millions of U.S. dollars) |
(unaudited) |
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
Year Ending |
|
September 30, |
|
|
September 30, |
|
|
December 31, 2016 |
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
|
Guidance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net
Loss |
$ |
(42.8 |
) |
|
$ |
(90.9 |
) |
|
$ |
(551.5 |
) |
|
$ |
(240.4 |
) |
|
$(600.0) to $(630.0) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense, net |
|
8.3 |
|
|
|
8.1 |
|
|
|
25.2 |
|
|
|
25.9 |
|
|
33.0 |
Provision
for (benefit from) income taxes |
|
(24.0 |
) |
|
|
0.5 |
|
|
|
(187.4 |
) |
|
|
(7.3 |
) |
|
(187.0) - (197.0) |
Depreciation
expense |
|
18.8 |
|
|
|
9.1 |
|
|
|
42.7 |
|
|
|
25.4 |
|
|
45.0 -
55.0 |
Amortization
expense |
|
7.5 |
|
|
|
2.6 |
|
|
|
22.6 |
|
|
|
7.8 |
|
|
30.0 |
Stock-based
compensation expense |
|
32.9 |
|
|
|
28.8 |
|
|
|
97.3 |
|
|
|
81.0 |
|
|
120.0
- 140.0 |
Contingent
consideration expense (1) |
|
2.2 |
|
|
|
0.5 |
|
|
|
(56.9 |
) |
|
|
15.1 |
|
|
(50.0)
- (60.0) |
Acquisition
expenses (2) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7.0 |
|
|
- |
Impairment
charges (3) |
|
— |
|
|
|
— |
|
|
|
599.1 |
|
|
|
12.8 |
|
|
599.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
non-GAAP Income
(Loss) |
$ |
2.9 |
|
|
$ |
(41.3 |
) |
|
$ |
(8.9 |
) |
|
$ |
(72.7 |
) |
|
$(10.0) to $(30.0) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following reconciliation of the GAAP reported to non-GAAP
information provides the details of the effects of the non-GAAP
adjustments on certain components of the Company’s operating
results for each of the periods presented.
|
|
Reconciliation Of Certain GAAP Reported
Information To non-GAAP Information |
|
Three and Nine Months Ended September 30, 2016
and 2015 |
|
(In millions of U.S. dollars) |
|
(Unaudited) |
|
|
|
|
Three Months Ended September 30, |
|
|
2016 |
|
|
2015 |
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
GAAPReported |
|
|
Interest, Taxes, Depreciationand Amortization |
|
|
Stock-Based Compensation, Contingent Consideration and
Other Adjustments |
|
|
non-GAAP |
|
|
GAAPReported |
|
|
Interest, Taxes, Depreciation and Amortization |
|
|
Stock-Based Compensation, Contingent Consideration and
Other Adjustments |
|
|
non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
$ |
50.7 |
|
|
$ |
— |
|
|
$ |
(2.1 |
) |
|
$ |
48.6 |
|
|
$ |
34.9 |
|
|
$ |
— |
|
|
$ |
(1.4 |
) |
|
$ |
33.5 |
|
Research and
development |
|
160.8 |
|
|
|
(11.1 |
) |
|
|
(14.2 |
) |
|
|
135.5 |
|
|
|
158.7 |
|
|
|
(4.3 |
) |
|
|
(12.6 |
) |
|
|
141.8 |
|
Selling, general
and administrative |
|
118.8 |
|
|
|
(7.7 |
) |
|
|
(16.6 |
) |
|
|
94.5 |
|
|
|
94.0 |
|
|
|
(4.8 |
) |
|
|
(14.8 |
) |
|
|
74.4 |
|
Intangible asset
amortization and contingent consideration (1) |
|
9.7 |
|
|
|
(7.5 |
) |
|
|
(2.2 |
) |
|
|
— |
|
|
|
3.1 |
|
|
|
(2.6 |
) |
|
|
(0.5 |
) |
|
|
— |
|
Interest expense, net |
|
(8.3 |
) |
|
|
8.3 |
|
|
|
— |
|
|
|
— |
|
|
|
(8.1 |
) |
|
|
8.1 |
|
|
|
— |
|
|
|
— |
|
Other income
(expense) |
|
1.6 |
|
|
|
— |
|
|
|
— |
|
|
|
1.6 |
|
|
|
(0.5 |
) |
|
|
— |
|
|
|
— |
|
|
|
(0.5 |
) |
Provision for (benefit
from) income taxes |
|
(24.0 |
) |
|
|
24.0 |
|
|
|
— |
|
|
|
— |
|
|
|
0.5 |
|
|
|
(0.5 |
) |
|
|
— |
|
|
|
— |
|
Net Loss/non-GAAP Income
(Loss) |
|
(42.8 |
) |
|
|
10.6 |
|
|
|
35.1 |
|
|
|
2.9 |
|
|
|
(90.9 |
) |
|
|
20.3 |
|
|
|
29.3 |
|
|
|
(41.3 |
) |
|
Nine Months Ended September 30, |
|
|
2016 |
|
|
2015 |
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
GAAPReported |
|
|
Interest, Taxes, Depreciationand Amortization |
|
|
Stock-Based Compensation, Contingent Consideration and
Other Adjustments |
|
|
non-GAAP |
|
|
GAAP Reported |
|
|
Interest, Taxes, Depreciation and Amortization |
|
|
Stock-Based Compensation, Contingent Consideration and
Other Adjustments |
|
|
non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
$ |
145.5 |
|
|
$ |
— |
|
|
$ |
(6.0 |
) |
|
$ |
139.5 |
|
|
$ |
104.0 |
|
|
$ |
— |
|
|
$ |
(4.5 |
) |
|
$ |
99.5 |
|
Research and
development |
|
486.7 |
|
|
|
(23.4 |
) |
|
|
(43.0 |
) |
|
|
420.3 |
|
|
|
458.7 |
|
|
|
(11.7 |
) |
|
|
(35.0 |
) |
|
|
412.0 |
|
Selling, general
and administrative (2) |
|
333.6 |
|
|
|
(19.3 |
) |
|
|
(48.3 |
) |
|
|
266.0 |
|
|
|
288.4 |
|
|
|
(13.7 |
) |
|
|
(48.5 |
) |
|
|
226.2 |
|
Intangible asset
amortization and contingent consideration (1) |
|
(34.3 |
) |
|
|
(22.6 |
) |
|
|
56.9 |
|
|
|
— |
|
|
|
22.9 |
|
|
|
(7.8 |
) |
|
|
(15.1 |
) |
|
|
— |
|
Impairment of intangible
assets (3) |
|
599.1 |
|
|
|
— |
|
|
|
(599.1 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Interest expense, net |
|
(25.2 |
) |
|
|
25.2 |
|
|
|
— |
|
|
|
— |
|
|
|
(25.9 |
) |
|
|
25.9 |
|
|
|
— |
|
|
|
— |
|
Other income
(expense) |
|
0.1 |
|
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
(9.8 |
) |
|
|
— |
|
|
|
12.8 |
|
|
|
3.0 |
|
Benefit from income
taxes |
|
(187.4 |
) |
|
|
187.4 |
|
|
|
— |
|
|
|
— |
|
|
|
(7.3 |
) |
|
|
7.3 |
|
|
|
— |
|
|
|
— |
|
Net Loss/non-GAAP
Loss |
|
(551.5 |
) |
|
|
(96.9 |
) |
|
|
639.5 |
|
|
|
(8.9 |
) |
|
|
(240.4 |
) |
|
|
51.8 |
|
|
|
115.9 |
|
|
|
(72.7 |
) |
(1) Includes 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 regulatory and commercial milestones.
Amounts for the nine months ended September 30, 2016 include $43.8
million and $21.1 million related to the change in probability of
achieving the Kyndrisa and reveglucosidase alfa development
milestones, respectively, as a result of discontinuance of these
programs in June 2016.(2) Includes $7.0 million of acquisition
costs for the nine months ended September 30, 2015 related to the
acquisition of Prosensa Holdings N.V.(3) Includes $574.1
million and $25.0 million for the impairment of intangible assets
associated with the discontinuance of the Kyndrisa and
reveglucosidase alfa development programs, respectively, in June
2016.
Contact:
Investors:
Traci McCarty
BioMarin Pharmaceutical Inc.
(415) 455-7558
Media:
Debra Charlesworth
BioMarin Pharmaceutical Inc.
(415) 455-7451
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