The Medicines Company (NASDAQ:MDCO) today announced
its business and financial results for the first-quarter
ended March 31, 2017.
“During the first quarter of 2017, The Medicine Company
continued to deliver excellent execution against our 2017
objectives, significantly advancing key development programs,
strictly managing cash deployment to enhance our ability to support
our products and pipeline going forward, maintaining maximum
strategic and operational flexibility and positioning us to drive
shareholder value,” said Clive Meanwell, M.D., Ph.D., Chief
Executive Officer of The Medicines Company. “Nowhere is that
execution excellence more evident than in our press release this
morning announcing our agreement with the FDA on the Phase III
development program for inclisiran. We believe this agreement adds
significantly to the strategic value of inclisiran, and follows the
presentation of positive final results from the ORION-1 Phase II
study of inclisiran at the American College of Cardiology’s 66th
Annual Scientific Session on March 17, 2017. Those results, which
were simultaneously published in The New England Journal of
Medicine, demonstrated inclisiran’s unique and
highly-differentiated attributes and its game-changing
potential.”
Dr. Meanwell continued, “During the first quarter, we also
announced that the FDA had accepted for priority review the
Company’s NDA filing for meropenem-vaborbactam (the combination
formerly known as CARBAVANCE) for complicated urinary tract
infections. The TANGO 2 Phase III trial, which compares the safety,
tolerability and efficacy of meropenem-vaborbactam with best
available therapy in patients with selected serious infections due
to confirmed or suspected carbapenem-resistant Enterobacteriaceae,
is ongoing and we expect results to be available before the end of
the third quarter of 2017. In the meantime, in the event that
meropenem-vaborbactam is approved by the FDA, we are actively
preparing to launch the product in the United States through our
existing sales and distribution infrastructure.”
First-Quarter 2017 Financial Summary from Continuing
Operations
Worldwide net revenue was $24.2 million in the first-quarter of
2017 compared to $50.3 million in the first-quarter of 2016.
Included in total net revenue for the first-quarter of 2017 and
2016 were $10.4 million and $18.9 million, respectively, of royalty
revenues derived from the gross profit on authorized generic sales
of Angiomax® (bivalirudin) by Sandoz, Inc. Worldwide
Angiomax®/Angiox® (bivalirudin) net product sales were $6.9 million
in the first-quarter of 2017, compared to $16.9 million in the
first-quarter of 2016, with net product sales in the United States
decreasing to $4.8 million in the first-quarter of 2017 from $13.2
million in the first-quarter of 2016. Other products, including
Ionsys® (fentanyl iontophoretic transdermal system), Minocin®
(minocycline) for Injection, and Orbactiv® (oritavancin), and
including the divested non-core cardiovascular products in the
first-quarter of 2016, recorded sales of $7.0 million in the
first-quarter of 2017 compared to $14.5 million in the
first-quarter of 2016.
Net loss from continuing operations in the first-quarter of 2017
was $102.7 million, or $1.44 per share, compared to $90.4 million,
or $1.31 per share, in the first-quarter of 2016. Adjusted net loss
(1) from continuing operations in the first-quarter of 2017 was
$74.7 million, or $1.05(1) per share, compared to $71.2 million, or
$1.03(1) per share, in the first-quarter of 2016.
First-Quarter 2016 Financial Summary from Discontinued
Operations
In the first-quarter of 2016, the Company completed the sale of
its hemostasis products. Net loss from discontinued operations in
the first-quarter of 2016 was $2.1 million, or $0.03 per share.
(1)Adjusted net loss and adjusted loss per share from continuing
operations are non-GAAP financial performance measures with no
standardized definitions under U.S. GAAP. For further information
and a detailed reconciliation, refer to the “Non-GAAP Financial
Performance Measures” and “Reconciliations of GAAP to Adjusted Net
Loss and Adjusted Loss per Share” sections of this press
release.
At March 31, 2017, the Company had $436.7 million in cash and
cash equivalents compared to $541.8 million at the end of 2016.
First-Quarter 2017 Conference Call and Webcast
Information
The Company will host a conference call and webcast today, April
26, 2017, at 8:30 a.m., Eastern Daylight Time, to discuss
first-quarter 2017 financial results. The dial-in information to
access the call is as follows:
U.S./Canada: (877) 359-9508 International: (224)
357-2393 Conference ID: 4094876
A taped replay of the conference call will be available from
11:30 a.m., Eastern Daylight Time, today until 11:30 a.m., Eastern
Daylight Time, on May 3, 2017. The replay may be accessed as
follows:
U.S./Canada: (855) 859-2056 International: (404)
537-3406 Conference ID: 4094876
The webcast can be accessed in the Investors section of The
Medicines Company website. A replay of the webcast will also be
available.
About The Medicines Company
The Medicines Company is a biopharmaceutical company driven by
an overriding purpose – to save lives, alleviate suffering and
contribute to the economics of healthcare. The Company’s mission is
to create transformational solutions to address the most pressing
healthcare needs facing patients, physicians and providers in three
critical therapeutic areas: serious infectious disease care,
cardiovascular care and surgery and perioperative care. The Company
is headquartered in Parsippany, New Jersey, with global innovation
centers in California and Switzerland.
Forward Looking Statements
Statements contained in this press release that are not purely
historical may be deemed to be forward-looking statements for
purposes of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995. Without limiting the foregoing, the
words "believes," "anticipates," "plans" and "expects" and similar
expressions, including the Company's preliminary financial results,
are intended to identify forward-looking statements. These
forward-looking statements involve known and unknown risks and
uncertainties that may cause the Company's actual results, levels
of activity, performance or achievements to be materially different
from those expressed or implied by these forward-looking
statements. Important factors that may cause or contribute to such
differences include whether the Company's product candidates will
advance in the clinical trials process on a timely basis or at all,
or succeed in achieving their specified endpoints; whether the
Company will make regulatory submissions for product candidates on
a timely basis; whether its regulatory submissions will receive
approvals from regulatory agencies on a timely basis or at all;
whether the Company’s ongoing and planned commercial launches will
be successful; the extent of the commercial success of our
products; the Company's ability to penetrate foreign markets;
whether physicians, patients and other key decision makers will
accept clinical trial results; whether the Company can protect its
intellectual property; whether the Company will be able to raise
additional capital on favorable terms or at all when needed; and
such other factors as are set forth in the risk factors detailed
from time to time in the Company's periodic reports and
registration statements filed with the Securities and Exchange
Commission, including, without limitation, the risk factors
detailed in the Company's Annual Report on Form 10-K filed with the
SEC on March 1, 2017, which are incorporated herein by reference.
The Company specifically disclaims any obligation to update these
forward-looking statements.
NON-GAAP FINANCIAL PERFORMANCE MEASURES
In addition to financial information prepared in accordance with
U.S. GAAP, this press release also contains adjusted net loss and
adjusted loss per share from continuing operations attributable to
The Medicines Company. The Company believes these measures provide
investors and management with supplemental information relating to
operating performance and trends that facilitate comparisons
between periods and with respect to projected information.
Adjusted net loss from continuing operations excludes
share-based compensation expense, amortization of acquired
intangible assets, inventory adjustments, restructuring charges,
milestone payments, changes in contingent purchase price, non-cash
interest expense and net loss tax adjustments. The Company believes
these non-GAAP financial measures help indicate underlying trends
in the Company’s business and are important in comparing current
results with prior period results and understanding projected
operating performance. Non-GAAP financial measures provide the
Company and its investors with an indication of the Company’s
baseline performance before items that are considered by the
Company not to be reflective of the Company’s ongoing results. See
the attached Reconciliations of GAAP to Adjusted Net Loss and
Adjusted Loss per Share for explanations of the amounts excluded
and included to arrive at adjusted net loss and adjusted loss per
share amounts for the three month periods ended March 31, 2017 and
2016.
These adjusted measures are non-GAAP and should be considered in
addition to, but not as a substitute for, the information prepared
in accordance with U.S. GAAP. The Company strongly encourages
investors to review its consolidated financial statements and
publicly-filed reports in their entirety and cautions investors
that the non-GAAP measures used by the Company may differ from
similar measures used by other companies, even when similar terms
are used to identify such measures.
THE MEDICINES COMPANY
CONSOLIDATED STATEMENTS OF
OPERATIONS
UNAUDITED
(In thousands, except per share
amounts)
Three Months EndedMarch 31, 2017
2016 Net product revenues $ 13,845 $ 31,375 Royalty revenues
10,371 18,931 Total net revenues 24,216 50,306
Operating expenses: Cost of product revenues 13,553 18,797 Research
and development 38,427 33,491 Selling, general and administrative
63,182 79,298 Total operating expenses 115,162
131,586 Loss from operations (90,946 ) (81,280 )
Co-promotion and license income 757 975 Interest expense (12,422 )
(9,746 ) Other loss (9 ) (262 ) Loss from continuing operations
before income taxes (102,620 ) (90,313 ) Provision for income taxes
(50 ) (46 ) Net loss from continuing operations (102,670 ) (90,359
) Loss from discontinued operations, net of tax — (2,105 )
Net loss (102,670 ) (92,464 ) Net loss attributable to
non-controlling interest — 16 Net loss attributable
to The Medicines Company $ (102,670 ) $ (92,448 ) Amounts
attributable to The Medicines Company: Net loss from continuing
operations $ (102,670 ) $ (90,343 ) Loss from discontinued
operations, net of tax — (2,105 ) Net loss attributable to
The Medicines Company $ (102,670 ) $ (92,448 ) Basic loss
per common share attributable to The Medicines Company: Loss from
continuing operations $ (1.44 ) $ (1.31 ) Loss from discontinued
operations — (0.03 ) Basic loss per share $ (1.44 ) $ (1.34
) Diluted loss per common share attributable to The
Medicines Company: Loss from continuing operations $ (1.44 ) $
(1.31 ) Loss from discontinued operations — (0.03 ) Diluted
loss per share $ (1.44 ) $ (1.34 ) Weighted average number
of common shares outstanding: Basic 71,073 69,210 Diluted 71,073
69,210
THE MEDICINES COMPANY
RECONCILIATIONS OF GAAP TO ADJUSTED NET
LOSS AND
ADJUSTED LOSS PER SHARE
UNAUDITED
(In thousands, except per share
amounts)
Three Months EndedMarch 31, 2017
2016 Net loss from continuing operations attributable to The
Medicines Company - GAAP $ (102,670 ) $ (90,343 ) Before tax
adjustments: Cost of product revenues: Share-based compensation
expense (1) 171 215 Amortization of acquired intangible assets (2)
6,469 6,285 Inventory adjustments (3) (411 ) — Restructuring
charges (4) (66 ) — Research and development: Share-based
compensation expense (1) 1,031 850 Restructuring charges (4) (108 )
— Milestone payments (5) — 1,000 Selling, general and
administrative: Share-based compensation expense (1) 5,441 5,938
Restructuring charges (4) (51 ) — Changes in contingent purchase
price (6) 8,513 (1,428 ) Other: Non-cash interest expense (7) 6,973
6,300 Net loss tax adjustments (8) (1 ) 9 Net loss
attributable to The Medicines Company – Adjusted $ (74,709 ) $
(71,174 ) Net loss per share attributable to The Medicines
Company – Adjusted Basic $ (1.05 ) $ (1.03 ) Diluted $ (1.05 ) $
(1.03 ) Weighted average number of common shares outstanding: Basic
71,073 69,210 Diluted 71,073 69,210
Explanation of Adjustments:
(1) Excludes share-based compensation of $6,643 and $7,003
for the three months ended March 31, 2017 and 2016 because these
expenses are substantially dependent on changes in the market price
of the Company's common stock. (2) Excludes amortization of
intangible assets resulting from transactions with Targanta,
Incline Therapeutics and Rempex. (3) Excludes all non-cash
inventory adjustments. (4) Excludes restructuring adjustments for
the workforce reorganization related to the sale of the non-core
cardiovascular products. (5) Excludes upfront and milestone
payments for research and development collaboration arrangements
and manufacturing scale up for MDCO-216. (6) Excludes changes in
fair value of the contingent price related to the acquisitions of
Targanta, Incline Therapeutics, Rempex and Annovation. (7) Excludes
non-cash interest expense which is in excess of the actual interest
expense paid on the Convertible Senior Notes. (8) Net loss tax
adjustments reflect the estimated tax effect of the above
adjustments and the impact of certain other non-operating tax
adjustments.
In addition to the financial information prepared in accordance
with U.S. GAAP, this press release also contains adjusted financial
measures that the Company believes provide investors and management
with supplemental information relating to operating performance and
trends that facilitate comparisons between periods and with respect
to projected information. These adjusted measures should be
considered in addition to, but not as a substitute for, the
information prepared in accordance with U.S. GAAP. The Company
strongly encourages investors to review its consolidated financial
statements and publicly filed reports in their entirety and
cautions investors that the non-GAAP measures used by the Company
may differ from similar measures used by other companies, even when
similar terms are used to identify such measures.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170426005501/en/
The Medicines CompanyMediaMeg Langan, 973-290-6319Vice
Presidentmargaret.langan@themedco.comorInvestor RelationsKrishna Gorti, M.D.,
973-290-6122Vice President, Investor
Relationskrishna.gorti@themedco.com
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