- Exceeded 2018 top- and bottom-line
guidance
- 2019 guidance reflects strong operating
momentum leading to double-digit top- and bottom-line growth;
Reaffirming 2020 financial outlook
- Advancing five late-stage assets with U.S.
approvals expected through 2020; Ozanimod U.S. and EU regulatory
submissions on-track for Q1:2019
Celgene Corporation (NASDAQ: CELG) reported operating results
for the fourth quarter and full year of 2018. For the fourth
quarter of 2018, net product sales were $4,036 million, an increase
of 16 percent year-over-year. Fourth quarter total revenue
increased 16 percent year-over-year to $4,037 million.
Net product sales for the full year of 2018 were $15,265
million, an increase of 18 percent year-over-year. Total revenue
for the full year of 2018 was $15,281 million, an increase of 18
percent year-over-year.
Based on U.S. GAAP (Generally Accepted Accounting Principles),
Celgene reported net income of $1,073 million and diluted earnings
per share (EPS) of $1.50 for the fourth quarter of 2018. For the
fourth quarter of 2017, GAAP net loss was $81 million and diluted
EPS was ($0.10). Full year GAAP net income for 2018 was $4,046
million and diluted EPS was $5.51. Full year GAAP net income for
2017 was $2,940 million and diluted EPS was $3.64.
Adjusted net income for the fourth quarter of 2018 increased 7
percent to $1,709 million compared to $1,592 million in the fourth
quarter of 2017. For the same period, adjusted diluted EPS
increased 20 percent to $2.39 from $2.00.
Adjusted net income for the full year of 2018 increased 8
percent to $6,511 million. Adjusted diluted EPS increased 19
percent to $8.87 from $7.44 for the full year of 2017.
“2018 was another year of excellent operating results and
significant progress advancing our innovative early-, mid- and
late-stage pipeline,” said Mark J. Alles, Chairman and Chief
Executive Officer of Celgene Corporation. “With five near-term
product launches and many promising assets advancing, we are very
optimistic about our potential for long-term growth as part of the
new Bristol-Myers Squibb.”
Fourth Quarter and Full Year 2018
Financial Highlights
Unless otherwise stated, all comparisons are for the fourth
quarter and full year of 2018 compared to the fourth quarter and
full year of 2017. The adjusted operating expense categories
presented below exclude share-based employee compensation expense,
collaboration-related upfront expense, research and development
asset acquisition expense, IPR&D asset impairment charges,
clinical trial and development activity wind-down costs 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 fourth quarter
increased 16 percent to $2,549 million. Fourth quarter U.S. sales
of $1,729 million and international sales of $820 million increased
17 percent and 15 percent, respectively. REVLIMID® sales growth was
driven by increases in treatment duration and market share. Full
year REVLIMID® sales were $9,685 million, an increase of 18 percent
year-over-year.
- POMALYST®/IMNOVID® sales for the fourth
quarter were $567 million, an increase of 28 percent
year-over-year. Fourth quarter U.S. sales of $393 million and
international sales of $174 million increased 39 percent and 9
percent, respectively. POMALYST®/IMNOVID® sales growth was driven
primarily by increases in treatment duration and market share. Full
year POMALYST®/IMNOVID® sales were $2,040 million, an increase of
26% year-over-year.
- OTEZLA® sales in the fourth quarter
were $448 million, a 21 percent increase year-over-year. Fourth
quarter U.S. sales of $360 million and international sales of $88
million increased 19 percent and 29 percent, respectively. OTEZLA®
sales growth in the U.S. was driven by increases in demand. OTEZLA®
international sales were driven by launch uptake in key ex-U.S.
markets, including Japan. Full year OTEZLA® sales were $1,608
million, an increase of 26 percent year-over-year.
- ABRAXANE® sales for the fourth quarter
were $269 million, an increase of 7 percent year-over-year. Fourth
quarter U.S. sales of $178 million and international sales of $91
million increased 15 percent and decreased 5 percent, respectively.
ABRAXANE® sales growth was driven primarily by demand. Full year
ABRAXANE® sales were $1,062 million, an increase of 7 percent
year-over-year.
- In the fourth quarter, all other
product sales, which include IDHIFA®, THALOMID®, ISTODAX®, VIDAZA®
and an authorized generic version of VIDAZA® drug product primarily
sold in the U.S., were $203 million compared to $227 million in the
fourth quarter of 2017. Full year sales for these products were
$870 million compared to $901 million for the full year 2017.
Research and Development (R&D)
On a GAAP basis, R&D expenses were $1,138 million for the
fourth quarter of 2018 versus $2,738 million for the same period in
2017. Full year 2018 R&D expenses were $5,673 million compared
to $5,915 million for 2017.
Adjusted R&D expenses were $919 million for the fourth
quarter of 2018 compared to $766 million for the same period in
2017. For the full year 2018, adjusted R&D expenses were $3,509
million compared to $2,749 million for the full year 2017. Both the
fourth quarter and full year 2018 increases in R&D expenses
were primarily driven by the inclusion of R&D expenses
associated with the acquisition of Juno Therapeutics (Juno) and
regulatory submission-related work on multiple programs. Additional
R&D expenses (only included on a GAAP basis) decreased in 2018,
as outlined in the attached Reconciliation of GAAP to Adjusted Net
Income.
Selling, General, and Administrative (SG&A)
On a GAAP basis, SG&A expenses were $850 million for the
fourth quarter of 2018 compared to $774 million for the same period
in 2017. Full year SG&A expenses were $3,250 million for 2018
compared to $2,941 million for 2017.
Adjusted SG&A expenses were $762 million for the fourth
quarter of 2018 compared to $687 million for the same period in
2017. For full year 2018, adjusted SG&A expenses were $2,747
million versus $2,279 million in 2017. Both the fourth quarter and
full year 2018 increases in SG&A expenses were primarily driven
by the inclusion of SG&A expense associated with the
acquisition of Juno and marketing-related expenses. Additional
SG&A expenses (only included on a GAAP basis) increased in
2018, as outlined in the attached Reconciliation of GAAP to
Adjusted Net Income.
Cash, Cash Equivalents, Marketable Debt Securities and
Publicly-Traded Equity Securities
Operating cash flow was $5.2 billion for both 2018 and 2017.
Celgene ended the fourth quarter of 2018 with approximately $6.0
billion in cash, cash equivalents, marketable debt securities and
publicly-traded equity securities.
Volume-Driven Product Sales and
Earnings Growth Expected in 2019
2019 Guidance
Year-over-Year Change Total Revenue $17.0B to
$17.2B ~12%
* REVLIMID® Net Product
Sales ~ $10.8B ~12% POMALYST®/IMNOVID® Net Product Sales ~ $2.4B
~18% OTEZLA® Net Product Sales ~ $1.9B ~18% ABRAXANE® Net Product
Sales ~ $1.1B ~4% GAAP Operating Margin** Approximately 49% N/M**
Adjusted Operating Margin Approximately 57.5% ~+200 bps Adjusted
Tax Rate ~17.0% ~+50 bps GAAP diluted EPS $8.40 - $9.08
N/M
** Adjusted diluted EPS $10.60 - $10.80 ~21%
*
Weighted average diluted shares ~715M ~(20M)
*Year-over-year percentage change based on the mid-point
of the range.**Not meaningful as the 2019 measures exclude
the impact of any strategic transactions, impairments, loss
contingencies, changes in the fair value of equity investments,
costs associated with the Bristol-Myers Squibb Company
(Bristol-Myers Squibb) and Celgene transaction and non-operating
tax adjustments that have not yet occurred.
Portfolio Updates
- At the 60th American Society of
Hematology (ASH) Annual Meeting in December, data were presented on
Celgene’s marketed and pipeline hematology assets. Select data
presentations included:
- In collaboration with partner Acceleron
Pharma, data from the phase III MEDALIST™ and BELIEVE™ trials with
luspatercept in patients with low-to-intermediate risk
myelodysplastic syndromes (MDS) and transfusion-dependent
beta-thalassemia, respectively;
- Data from the phase I TRANSCEND CLL-004
trial evaluating liso-cel in patients with relapsed and/or
refractory chronic lymphocytic leukemia (CLL); and,
- Data from the phase III AUGMENT™ trial
evaluating REVLIMID® in combination with rituximab (R²) in patients
with relapsed and/or refractory indolent non-Hodgkin lymphoma
(NHL)
- A New Drug Application (NDA) was
submitted to the U.S. Food and Drug Administration (FDA) for
fedratinib for the treatment of patients with myelofibrosis.
Celgene plans to submit a Marketing Authorization Application (MAA)
with the European Medicines Agency (EMA) in the first half of 2019.
In addition, the phase III myelofibrosis program (FREEDOM and
FREEDOM-2 trials) evaluating fedratinib in patients resistant or
intolerant to ruxolitinib is initiating
- A supplemental NDA (sNDA) was submitted
to the U.S. FDA for REVLIMID® in combination with rituximab
(AUGMENT™ trial) for the treatment of patients with relapsed and/or
refractory indolent NHL. The anticipated U.S. FDA action date for
this application is in the second half of 2019
- In the fourth quarter, Celgene and
partner bluebird bio announced the completion of enrollment for the
KarMMa™ pivotal trial evaluating bb2121 in patients with relapsed
and/or refractory multiple myeloma (RRMM)
- The phase II TRANSCEND OUTREACH trial
evaluating liso-cel (JCAR017) in patients with relapsed and/or
refractory diffuse large B-cell lymphoma (DLBCL) in the outpatient
setting initiated in the fourth quarter
- The phase II pivotal trial evaluating
liso-cel in patients with relapsed and/or refractory CLL is
initiating
- The phase III ADVANCE™ trial evaluating
OTEZLA® in patients with mild to moderate plaque psoriasis is
initiating
Business Update Summary
- In January, Celgene and Bristol-Myers
Squibb (BMS) announced that they have entered into a definitive
merger agreement under which BMS will acquire Celgene for
approximately $74 billion (based on closing price of BMS on date of
the agreement). Under the terms of the agreement, Celgene
shareholders will receive for each Celgene share $50 plus one BMS
share and one tradeable Contingent Value Right (CVR), which will
entitle the holder to receive a cash payment of $9.00 upon the
achievement of FDA approval of all three products (ozanimod,
liso-cel and bb2121) within specified time periods. The transaction
is subject to approval by BMS and Celgene stockholders and the
completion of customary closing conditions and regulatory
approvals. BMS and Celgene expect to close the transaction in the
third quarter of 2019.
Q4 and Full Year 2018 Conference Call and Webcast
Information
Celgene will host a conference call to discuss the fourth
quarter and full year of 2018 operational and financial performance
on Thursday, January 31, 2019, 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 January 31, 2019, until
midnight ET February 7, 2019. To access the replay in the U.S.,
dial 1-855-859-2056; outside the U.S. dial 404-537-3406. The
participant passcode is 7075709.
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® as a single agent is also indicated as
a maintenance therapy in patients with multiple myeloma following
autologous hematopoietic stem cell transplant. 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, including factors related to the proposed
transaction between Bristol-Myers Squibb and Celgene, such as, but
not limited to, the risks that: management’s time and attention is
diverted on transaction related issues; disruption from the
transaction makes it more difficult to maintain business,
contractual and operational relationships; legal proceedings are
instituted against Bristol-Myers Squibb, Celgene or the combined
company; and Bristol-Myers Squibb, Celgene or the combined company
is unable to retain key personnel.
Hyperlinks are provided as a convenience and for informational
purposes only. Celgene bears no responsibility for the security or
content of external websites.
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 and success payments. 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: significant litigation-related loss contingency accruals and
expenses to settle other disputed matters and, effective for fiscal
year 2018, changes in the fair value of our equity securities upon
the adoption of ASU 2016-01 (Financial Instruments-Overall:
Recognition and Measurement of Financial Assets and Financial
Liabilities).
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, the impact of tax reform legislation commonly
referred to as the Tax Cuts and Jobs Act (2017 Tax Act), and other
similar items. We also exclude excess tax benefits and tax
deficiencies that arise upon vesting or exercise of share-based
payments recognized as income tax benefits or expenses due to their
nature, variability of amounts, and lack of predictability as to
occurrence and/or timing.
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 twelve-month periods ended
December 31, 2018 and 2017, and for the projected amounts for the
twelve-month period ending December 31, 2019.
Celgene
Corporation and Subsidiaries Condensed Consolidated
Statements of Operations (Unaudited) (In millions,
except per share data) Three-Month Periods Ended
Twelve-Month Periods Ended December 31, December 31, 2018
2017 2018 2017
Net product sales $ 4,036 $ 3,479 $ 15,265 $ 12,973 Other
revenue 1 4 16 30
Total revenue 4,037 3,483
15,281 13,003 Cost of goods sold
(excluding amortization of acquired intangible assets) 169 119 587
461 Research and development 1,138 2,738 5,673 5,915 Selling,
general and administrative 850 774 3,250 2,941 Amortization of
acquired intangible assets 127 79 468 329 Acquisition related
(gains) charges and restructuring, net (54 ) (1,425 )
112 (1,350 ) Total costs and expenses
2,230 2,285 10,090 8,296
Operating income 1,807 1,198 5,191 4,707
Interest and investment income, net 15 33 45 105 Interest (expense)
(190 ) (142 ) (741 ) (522 ) Other (expense) income, net (515
) 42 337 24 Income
before income taxes 1,117 1,131 4,832 4,314 Income tax
provision 44 1,212 786
1,374 Net income $ 1,073 $ (81 ) $
4,046 $ 2,940 Net income per common
share: Basic $ 1.53 $ (0.10 ) $ 5.65 $ 3.77 Diluted $ 1.50 $ (0.10
) $ 5.51 $ 3.64 Weighted average shares: Basic 699.5 773.5
716.3 779.2 Diluted 713.9 773.5 733.8 808.7 December
31, December 31, 2018 2017
Balance
sheet items: Cash, cash equivalents, debt securities
available-for-sale and equity investments with readily determinable
fair values $ 6,042 $ 12,042 Total assets 35,480 30,141 Long-term
debt, including current portion 20,270 15,838 Total stockholders'
equity 6,161 6,921
Celgene Corporation and
Subsidiaries Reconciliation of GAAP to Adjusted Net
Income (In millions, except per share data)
Three-Month Periods Ended Twelve-Month Periods Ended December 31,
December 31, 2018 2017 2018
2017 Net income (loss) - GAAP $ 1,073 $
(81 ) $ 4,046 $ 2,940 Before tax adjustments: Cost of goods
sold (excluding amortization of acquired intangible assets):
Share-based compensation expense (1 ) 9 7 36 29 Research and
development: Share-based compensation expense (1 ) 94 68 575 268
Collaboration-related upfront expense (2 ) 125 96 524 765 Research
and development asset acquisition expense (3 ) - - 1,125 325
IPR&D asset impairment charge (4 ) - 1,620 - 1,620 Charge
(adjustment) related to clinical trial and development activity
wind-down costs (4 ) - 188 (60 ) 188 Selling, general and
administrative: Share-based compensation expense (1 ) 88 87 503 347
Litigation-related loss contingency accrual expense (5 ) - - - 315
Amortization of acquired intangible assets (6 ) 127 79 468
329 Acquisition related (gains) charges and restructuring,
net: Change in fair value of contingent consideration and success
payments (7 ) (55 ) (1,425 ) 19 (1,350 ) Acquisition related
charges (8 ) 1 - 93 - Other (expense) income, net: Change in
fair value of equity investments (9 ) 513 - (317 ) - Income
tax provision: Estimated tax impact from above adjustments (10 )
(181 ) (299 ) (423 ) (686 ) Non-operating tax adjustments (11 )
(85 ) 1,252 (78 ) 926 Net
income - Adjusted $ 1,709 $ 1,592 $ 6,511 $
6,016 Net income per common share - Adjusted Basic $
2.44 $ 2.06 $ 9.09 $ 7.72 Diluted (12 ) $ 2.39 $ 2.00 $ 8.87 $ 7.44
Explanation of adjustments:
(1)
Exclude share-based compensation expense
totaling $191 and $162 for the three-month periods ended December
31, 2018 and 2017, respectively. Exclude share-based compensation
expense totaling $1,114 and $644 for the twelve-month periods ended
December 31, 2018 and 2017, respectively.
(2)
Exclude upfront payment expense for
research and development collaboration arrangements.
(3)
Exclude research and development asset
acquisition expenses.
(4)
Exclude charges and adjustments associated
with the discontinuance of GED-0301 clinical trials in Crohn's
disease (Trials), including impairment of an IPR&D asset and
other one-time charges related to wind-down costs associated with
discontinuing the Trials and certain development activities.
(5)
Exclude loss contingency accrual expenses
related to a civil litigation matter.
(6)
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), Quanticel
Pharmaceuticals, Inc. (Quanticel) and Juno Therapeutics, Inc.
(Juno).
(7)
Exclude changes in the fair value of
contingent consideration related to the acquisitions of Gloucester,
Abraxis, Avila, Nogra Pharma Limited (Nogra), Quanticel and Juno
(including success payments), including the impact of the
Nogra contingent consideration liabilities related to the
discontinuance of the Trials.
(8)
Exclude acquisition costs related to
Juno.
(9)
Exclude changes in the fair value of
equity investments upon the adoption of ASU 2016-01 (Financial
Instruments-Overall: Recognition and Measurement of Financial
Assets and Financial Liabilities).
(10)
Exclude the estimated tax impact of the
above adjustments.
(11)
Exclude other non-operating tax expense
items. The adjustments for the three-month period ended December
31, 2018 are to exclude adjustments to the provisional amounts
recorded for the one-time 2017 U.S. Transition Tax and other U.S.
Tax Reform impacts of a benefit of $79 and to exclude other
adjustments totaling a tax benefit of $6. The adjustments for
the twelve-month period ended December 31, 2018 are to exclude
the excess tax benefits related to the adoption of ASU 2016-09
(Compensation-Stock Compensation) of $22, a benefit to
the provisional amounts recorded for the one-time 2017 U.S.
Transition Tax and other U.S. Tax Reform impacts of a benefit of
$43 and to exclude other adjustments totaling tax benefit of
$13.The adjustments for the three-month period ended December 31,
2017 are to exclude expense of $1,269 as a result of the
implementation of the 2017 Tax Act and excess tax benefits related
to the adoption of ASU 2016-09 (Compensation-Stock Compensation) of
$17. The adjustments for the twelve-month period ended December 31,
2017 are to exclude expense of $1,269 as a result of the
implementation of the 2017 Tax Act, excess tax benefits related to
the adoption of ASU 2016-09 (Compensation-Stock Compensation) of
$290, prior year tax benefits arising from a U.S. research and
development and orphan drug tax credits study of $55 and to exclude
other adjustments totaling tax expense of $2.
(12)
Diluted net income per share for the
three-month period ended December 31, 2017 was determined using
diluted weighted-average shares of 797.4 million.
Celgene
Corporation and Subsidiaries Reconciliation of Full-Year
2019 Projected GAAP to Adjusted Net Income (In millions,
except per share data) Range Low High
Projected net income - GAAP (1 ) $ 6,005 $ 6,489 Before tax
adjustments: Cost of goods sold (excluding amortization of acquired
intangible assets): Share-based compensation expense 26 23
Research and development: Share-based compensation expense 424 362
Collaboration-related upfront expense 185 185 Selling,
general and administrative: Share-based compensation expense 371
317 Amortization of acquired intangible assets 459 424
Acquisition related charges and restructuring, net: Change
in fair value of contingent consideration and success payments 25
25 Other (expense) income, net: Change in fair value of
equity investments (57 ) (57 ) Income tax provision:
Estimated tax impact from above adjustments 141 (46 ) Non-operating
tax adjustments - - Projected net
income - Adjusted $ 7,579 $ 7,722 Projected
net income per diluted common share - GAAP $ 8.40 $ 9.08
Projected net income per diluted common share - Adjusted $ 10.60 $
10.80 Projected weighted average diluted shares 715.0
715.0 (1) Our projected 2019
earnings do not include the effect of any business combinations,
collaboration agreements, asset acquisitions, asset impairments,
litigation-related loss contingency accruals, changes in the fair
value of our CVRs issued as part of the acquisition of Abraxis,
changes in the fair value of equity investments upon the adoption
of ASU 2016-01 (Financial Instruments-Overall: Recognition and
Measurement of Financial Assets and Financial Liabilities) or
non-operating tax adjustments that may occur after the day prior to
the date of this press release. In addition, our projected 2019
financial measures do not include the effect of costs associated
with the Bristol-Myers Squibb Company and Celgene transaction.
Celgene Corporation and Subsidiaries
Net Product Sales (In millions)
Three-Month Periods Ended December 31, %
Change 2018 2017 Reported
Operational(1)
Currency(2)
REVLIMID® U.S. $ 1,729 $ 1,473 17.4 % 17.4 % 0.0 %
International 820 715 14.7 % 16.3 % (1.6 )% Worldwide
2,549 2,188 16.5 % 17.0 % (0.5 )%
POMALYST®/IMNOVID® U.S. 393 283 38.9 %
38.9 % 0.0 % International 174 159 9.4 % 10.7 % (1.3
)% Worldwide 567 442 28.3 % 28.8 % (0.5 )%
OTEZLA® U.S. 360 303 18.8 % 18.8 % 0.0 %
International 88 68 29.4 % 31.1 % (1.7 )% Worldwide
448 371 20.8 % 21.1 % (0.3 )%
ABRAXANE® U.S.
178 155 14.8 % 14.8 % 0.0 % International 91 96 (5.2
)% (4.5 )% (0.7 )% Worldwide 269 251 7.2 % 7.5 % (0.3 )%
IDHIFA® (3) U.S. 20 13 53.8 % 53.8 % 0.0 %
International 2 - N/A N/A N/A Worldwide 22 13 69.2 %
69.7 % (0.5 )%
VIDAZA® U.S. 2 3 (33.3 )% (33.3
)% 0.0 % International 134 160 (16.3 )% (15.2 )% (1.1
)% Worldwide 136 163 (16.6 )% (15.5 )% (1.1 )%
azacitidine for injection U.S. 3 4 (25.0 )% (25.0 )% 0.0 %
International 1 - N/A N/A (2.6 )% Worldwide 4 4 0.0 %
0.5 % (0.5 )%
THALOMID® U.S. 17 16 6.3 % 6.3 %
0.0 % International 8 12 (33.3 )% (30.8 )% (2.5 )%
Worldwide 25 28 (10.7 )% (9.6 )% (1.1 )%
ISTODAX® U.S. 9 16 (43.8 )% (43.8 )% 0.0 %
International 5 2 150.0 % 151.7 % (1.7 )% Worldwide
14 18 (22.2 )% (22.0 )% (0.2 )%
All Other U.S. - -
N/A N/A N/A International 2 1 N/A N/A N/A Worldwide 2
1 N/A N/A N/A
Total Net Product Sales U.S. 2,711
2,266 19.6 % 19.6 % 0.0 % International 1,325 1,213
9.2 % 10.6 % (1.4 )% Worldwide $ 4,036 $ 3,479 16.0 % 16.5 % (0.5
)% (1) Operational includes the impact from both
fluctuations in volume and net selling price changes. (2) Currency
includes the impact from both fluctuations in foreign exchange
rates and hedging activities. (3)
IDHIFA® was approved in August 2017 in the
U.S. for the treatment of adult patients with R/R AML with an
isocitrate dehydrogenase-2 (IDH2) mutation as detected by an FDA
approved test.
Celgene Corporation and Subsidiaries Net
Product Sales (In millions)
Twelve-Month Periods Ended December 31, %
Change 2018 2017 Reported
Operational(1)
Currency(2)
REVLIMID® U.S. $ 6,469 $ 5,426 19.2 % 19.2 % 0.0 %
International 3,216 2,761 16.5 % 17.5 % (1.0 )%
Worldwide 9,685 8,187 18.3 % 18.6 % (0.3 )%
POMALYST®/IMNOVID® U.S. 1,391 1,008
38.0 % 38.0 % 0.0 % International 649 606 7.1 % 8.1 %
(1.0 )% Worldwide 2,040 1,614 26.4 % 26.8 % (0.4 )%
OTEZLA® U.S. 1,275 1,058 20.5 % 20.5 % 0.0 %
International 333 221 50.7 % 51.6 % (0.9 )% Worldwide
1,608 1,279 25.7 % 25.9 % (0.2 )%
ABRAXANE®
U.S. 663 607 9.2 % 9.2 % 0.0 % International 399 385
3.6 % 4.2 % (0.6 )% Worldwide 1,062 992 7.1 % 7.3 % (0.2 )%
IDHIFA® (3) U.S. 68 20 240.0 % 240.0 % 0.0 %
International 4 - N/A N/A N/A Worldwide 72 20 260.0 %
259.9 % 0.1 %
VIDAZA® U.S. 9 8 12.5 % 12.5 %
0.0 % International 585 620 (5.6 )% (4.6 )% (1.0 )%
Worldwide 594 628 (5.4 )% (4.4 )% (1.0 )%
azacitidine for
injection U.S. 20 35 (42.9 )% (42.9 )% 0.0 % International
3 1 200.0 % 205.9 % (5.9 )% Worldwide 23 36 (36.1 )%
(35.8 )% (0.3 )%
THALOMID® U.S. 72 80 (10.0 )%
(10.0 )% 0.0 % International 42 52 (19.2 )% (17.7 )%
(1.5 )% Worldwide 114 132 (13.6 )% (13.0 )% (0.6 )%
ISTODAX® U.S. 48 67 (28.4 )% (28.4 )% 0.0 %
International 15 9 66.7 % 66.4 % 0.3 % Worldwide 63
76 (17.1 )% (17.1 )% 0.0 %
All Other U.S. - 1 N/A N/A
N/A International 4 8 N/A N/A N/A Worldwide 4 9 N/A
N/A N/A
Total Net Product Sales U.S. 10,015 8,310
20.5 % 20.5 % 0.0 % International 5,250 4,663 12.6 %
13.7 % (1.1 )% Worldwide $ 15,265 $ 12,973 17.7 % 18.1 % (0.4 )%
(1) Operational includes the impact from both
fluctuations in volume and net selling price changes. (2) Currency
includes the impact from both fluctuations in foreign exchange
rates and hedging activities. (3)
IDHIFA® was approved in August 2017 in the
U.S. for the treatment of adult patients with R/R AML with an
isocitrate dehydrogenase-2 (IDH2) mutation as detected by an FDA
approved test.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190131005437/en/
CelgeneInvestors:908-673-9628ir@celgene.comMedia:908-673-2275media@celgene.com
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