Net Product Revenue Increase of 35% Drives Profitable Quarter
Conference Call and Webcast to Be Held Today at 5:00 p.m. ET (22:00 CET)
NOVATO, Calif., July 30 /PRNewswire-FirstCall/ --
Financial Highlights ($ in millions, except per share data)
Item Q2 2009 Q2 2008 Comparison
Total BioMarin Revenue $82.8 29% increase
Total Net Product Revenue $81.5 35% increase
Naglazyme Net Product Revenue $42.9 22% increase
Aldurazyme Net Sales by Genzyme $39.2 1% increase
Aldurazyme BioMarin Net Product
Revenue $21.6 62% increase
Kuvan Net Product Revenue $16.9 41% increase
GAAP Net Income $1.3 $3.8
GAAP Net Income per share $0.01 (basic $0.04 (basic and
and diluted) diluted)
Non-GAAP Net Income $9.0 $9.7
Non-GAAP Net Income per share $0.09 (basic $0.09 (diluted),
and diluted) $0.10 (basic)
BioMarin Pharmaceutical Inc. (Nasdaq: BMRN) today announced financial results for the second quarter ended June 30, 2009. GAAP net income was $1.3 million ($0.01 per diluted share) for the second quarter of 2009, compared to GAAP net income of $3.8 million ($0.04 per diluted share) for the second quarter of 2008. Non-GAAP net income was $9.0 million ($0.09 per diluted share) for the second quarter of 2009, compared to non-GAAP net income of $9.7 million ($0.09 per diluted share) for the second quarter of 2008. Non-GAAP net income/loss excludes non-cash stock compensation expense, certain nonrecurring material items and the tax effect of the adjustments.
GAAP net loss for the six months ended June 30, 2009 was $11.8 million ($0.12 per diluted share), compared to GAAP net income of $5.5 million ($0.05 per diluted share) for the six months ended June 30, 2008. Non-GAAP net income was $18.4 million ($0.18 per diluted share) for the six months ended June 30, 2009, compared to non-GAAP income of $13.8 million ($0.13 per diluted share) for the six months ended June 30, 2008.
As of June 30, 2009, BioMarin had cash and short and long-term investments totaling $485.3 million. During the quarter, BioMarin made the final payment to Medicis of $70.6 million related to the Orapred transaction.
"During the quarter, we reported encouraging results from the Phase I PEG-PAL study, initiated the Phase I/II study for GALNS for MPS IVA and recently completed enrollment for this study, a noteworthy milestone for this program. On the commercial front, we announced earlier today the issuance of patents covering stable tablet formulation and the once daily dosing regimen for Kuvan, which we believe will be significant in extending patent protection an additional ten years beyond orphan drug market exclusivity. In addition, yesterday, we submitted the Kuvan NDS to Health Canada. With priority review status, we anticipate marketing approval in the first half of 2010. Also, during the quarter, we received approval for Naglazyme in Russia, which is especially significant as Russia influences many countries in Eastern Europe. In order to support the projected commercial needs for Naglazyme, Aldurazyme, GALNS and PEG-PAL through at least 2016, we are making significant investments to double our manufacturing capacity," said Jean-Jacques Bienaime, Chief Executive Officer of BioMarin. "Based on our performance to date, we feel confident in meeting our overall top and bottom line financial objectives for 2009 and have narrowed the guidance range on a few items to reflect increased visibility into the year. Our commercial products are performing well, and we continue to carefully manage expenses. We are also carefully evaluating both internal pipeline programs and external product opportunities to maximize long-term value for both the company and our shareholders."
Net Product Revenue
Net product revenue from Naglazyme (galsulfase), an enzyme replacement therapy for mucopolysaccharidosis VI (MPS VI), was $42.9 million for the second quarter of 2009, an increase of 22.3 percent compared to Naglazyme net product revenue of $35.1 million for the second quarter of 2008. Net product revenue from Naglazyme for the six months ended June 30, 2009 was $82.3 million, an increase of 31.0 percent from net product revenue of $62.8 million for the six months ended June 30, 2008. Changes in foreign currency rates, net of hedges caused a negative impact to Naglazyme sales of $1.7 million and $3.7 million in the three and six months ended June 30, 2009, respectively.
Net sales of Aldurazyme (laronidase), an enzyme replacement therapy for mucopolysaccharidosis I (MPS I) recorded by Genzyme, were $39.2 million for the second quarter of 2009, an increase of 1.0 percent compared to net sales by Genzyme of $38.7 million for the second quarter of 2008. Net sales of Aldurazyme recorded by Genzyme for the six months ended June 30, 2009 were $76.0 million, compared to net sales of $75.5 million for the six months ended June 30, 2008. Changes in foreign currency rates caused a negative impact to Aldurazyme sales by Genzyme of $3.6 million and $7.2 million in the three and six months ended June 30, 2009, respectively. However, in the second quarter of 2009, Aldurazyme unit volume increased 9.8 percent compared to the second quarter of 2008 as the number of patients on therapy worldwide continues to grow.
Net product revenue to BioMarin related to Aldurazyme was $21.6 million for the second quarter of 2009, including $6.1 million of incremental product transfer revenue. This compares to net product revenue to BioMarin of $13.4 million for the second quarter of 2008. During the second quarter of 2009, BioMarin recorded net product revenue that was higher than the royalty earned on Genzyme third party sales due to the incremental product transfer revenue related to net increases in Genzyme Aldurazyme inventory levels during the period.
Net product revenue from Kuvan (sapropterin dihydrochloride) Tablets, a product for the treatment of phenylketonuria (PKU), was $16.9 million for the second quarter of 2009, compared to $12.0 million for the second quarter of 2008. In the second quarter of 2009, net product revenue from Kuvan was negatively impacted by $0.7 million due to increased and retroactive federal rebates. Net product revenue from Kuvan for the six months ended June 30, 2009 was $32.5 million, compared to net revenue of $17.8 million for the six months ended June 30, 2008. The quantity of commercial tablets dispensed to patients in the U.S., the best metric to track true patient demand, increased 14.8 percent in the second quarter of 2009 compared to the first quarter of 2009.
2009 Guidance
Revenue Guidance ($ in millions)
Item 2009 Guidance Previous 2009 Guidance
Total BioMarin Revenues $311 to $336 $307 to $336
Total Net Product Revenues $304 to $329 $300 to $329
Naglazyme Net Product
Revenue $165 to $175 $160 to $175
Kuvan Net Product Revenue Unchanged $70 to $80
Aldurazyme Net Product
Revenue to BioMarin Unchanged $69 to $74
Selected Income Statement Guidance ($ in millions)
Item Guidance Previous 2009 Guidance
Cost of Sales (% of
Total Revenue) Unchanged 19% to 21%
Selling, General
and Admin. Expense Unchanged $120 to $130
Research and Development
Expense* Unchanged $118 to $128
Interest Income Unchanged $5 to $7
Impairment Loss on La Jolla
and Summit
Investments** $5.9 $7.9
GAAP Net Income (Loss) $(12) to $(6) $(15) to $0
Stock Compensation Expense $34 $32 to $35
Non-GAAP Net Income*** $35.4 to $41.4 $33.7 to $51.7
* Includes upfront research and development expenses of $8.8 million
associated with the La Jolla Pharmaceutical Company transaction.
** Represents impairment losses on investments in La Jolla Pharmaceutical
Company of $4.5 million and Summit plc of $1.4 million during the
first quarter of 2009.
*** Non-GAAP net income excludes non-cash stock compensation expense,
nonrecurring material items and the tax effect of the adjustments.
Please see the table provided at the end of this press release for a
full reconciliation between GAAP and non-GAAP expected net income.
Non-GAAP Financial Information and Reconciliation
The above results for the quarter and six months ended June 30, 2009 and 2008, full year results for 2008 and financial guidance for 2009 are presented both as determined in accordance with GAAP and on a non-GAAP basis. As used in this release, non-GAAP income is calculated in accordance with GAAP, but excludes non-cash stock compensation expense, certain nonrecurring material items and the tax effect of the adjustments.
Non-GAAP net income in the second quarter of 2009 and the second quarter of 2008 excluded (1) stock compensation expense of $9.0 million in the second quarter of 2009 and $5.9 million in the second quarter of 2008; (2) gain on the sale of equity investments of $1.6 million in the second quarter of 2009 and (3) income tax effect of $0.3 million in the second quarter of 2009. Non-GAAP net income in the six months ended June 30, 2009 and the six months ended June 30, 2008 excluded (1) stock compensation expense of $16.8 million in the six months ended June 30, 2009 and $10.4 million in the six months ended June 30, 2008; (2) upfront license fees of $8.8 million in the six months ended June 30, 2009; (3) impairment charges of $5.9 million in the six months ended June 30, 2009; (4) Aldurazyme transfer revenue of $2.3 million in the six months ended June 30, 2008; (5) gain on the sale of equity investments of $1.6 million in the six months ended June 30, 2009 and (6) income tax effect of $0.3 million and $0.2 million in the six months ended June 30, 2009 and 2008, respectively.
