| [February 18, 2015] |
 |
The Medicines Company Reports Fourth Quarter and Full Year 2014 Financial Results
The Medicines Company (NASDAQ:MDCO) today announced fourth quarter and
full year financial results for 2014.
Financial highlights for the fourth quarter of 2014:
Worldwide net revenue increased by 3.2% to $191.0 million for the fourth
quarter of 2014 from $185.0 million in the fourth quarter of 2013:
-
Worldwide Angiomax® (bivalirudin)/Angiox® (bivalirudin) revenue, was
up 3.1% to $165.9 million in the fourth quarter of 2014 compared to
$160.9 million in the fourth quarter of 2013, with revenue in the
United States increasing to $157.5 million in the fourth quarter of
2014 from $142.4 million in the fourth quarter of 2013.
-
Recothrom® Thrombin, topical (recombinant) sales were $17.9 million in
the United States in the fourth quarter of 2014, as compared to $19.7
million in the fourth quarter of 2013.
-
Other products including Argatroban RTU, Cleviprex® (clevidipine),
Minocin® (minocycline) for injection, OrbactivTM and
PreveLeakTM recorded sales of $7.2 million during fourth
quarter of 2014.
Net loss for the fourth quarter of 2014 was $5.3 million, or ($0.08) per
share, compared with net income of $1.2 million, or $0.02 per share for
the fourth quarter of 2013.
Adjusted net income(1) for the fourth quarter of 2014 was
$13.5 million, or $0.20 per share(1), compared to adjusted
net income(1) of $15.4 million, or $0.23 per share(1)
for the fourth quarter 2013.
Financial highlights for the full year of 2014:
Worldwide net revenue increased by 5.3% to $724.4 million in 2014, from
$687.9 million in 2013:
-
Worldwide Angiomax/Angiox revenue, was up 4.5% to $635.7 million in
2014 from $608.6 million in 2013, with revenue in the United States
increased to $599.5 million in 2014 from $550.2 million in 2013.
-
Recothrom sales were $64.4 million in the United States in 2014. Sales
during 2013 were $63.3 million, after the Company began selling
Recothrom in the US in February 2013.
-
Other products including Argatroban RTU, Cleviprex, Minocin
(minocycline) for injection, Orbactiv and PreveLeak recorded sales in
2014 of $24.3 million.
Net loss for the full year 2014 was $32.2 million, or ($0.50) per share,
compared with net income of $15.5 million, or $0.25 per share in 2013.
Adjusted net income(1) for the full year 2014 was $67.8
million, or $1.02 per share (1), compared to adjusted net
income(1) of $91.9 million, or $1.50 per share(1)
in 2013.
Glenn Sblendorio, President and Chief Financial Officer, stated, "We
showed solid financial performance in 2014, progressing our product
portfolio through a series of commercial, regulatory and developmental
successes that will contribute to prolonged growth through 2018 and
beyond. With the completion of the acquisition of Annovation Biopharma,
we expanded our surgery and perioperative care portfolio with what we
believe is an exciting new anesthetic, ABP (News - Alert)-700, which could be the first
new development in this area in the last 30 years."
Clive Meanwell, Chairman and Chief Executive Officer, added, "We
continue to build a leading acute and intensive care hospital portfolio
of innovative products. We have seven regulatory applications under
review with approvals expected in 2015. Three of these applications have
already received positive opinions recommending marketing authorization
from the Committee for Medicinal Products for Human Use of the European
Medicines Agency. We expect strong news flow throughout 2015 with new
product growth, regulatory approvals, and clinical advances for our key
pipeline products; it is a very exciting time at The Medicines Company."
(1) Adjusted net income and adjusted earnings per share are
non-GAAP financial performance measures with no standardized definitions
under US GAAP. For further information and a detailed reconciliation,
refer to the Non-GAAP Financial Performance Measures and Reconciliations
of GAAP to Adjusted Net income sections of this release for explanations
of the amounts excluded and included to arrive at adjusted net income
and adjusted earnings per share amounts.
Conference Call Information
There will be a conference call with management today at 8:30 a.m.
Eastern Time to discuss 2014 financial results and operational
developments.
Domestic Dial In: + 1 (888) 201-7255
International Dial In: + 1
(253) 642-1007
Passcode for both dial-in numbers: 80672834
Replay is available from 1:30 p.m. Eastern Time following the conference
call through February 25, 2015. To hear a replay of the call, dial +1
(855) 859-2056 (domestic) and +1 (404) 537-3406 (international).
Passcode for both dial in numbers is 80672834.
This call is being webcast and can be accessed via The Medicines Company
website at www.themedicinescompany.com.
About The Medicines Company
The Medicines Company's purpose
is to save lives, alleviate suffering and contribute to the economics of
healthcare by focusing on 3,000 leading acute/intensive care hospitals
worldwide. Its vision is to be a leading provider of solutions in three
areas: acute cardiovascular care, surgery and perioperative care, and
serious infectious disease care. The company operates in the Americas,
Europe and the Middle East, and Asia Pacific regions with global centers
today in Parsippany, NJ, USA and Zurich, Switzerland.
NON-GAAP FINANCIAL PERFORMANCE MEASURES
In addition to
financial information prepared in accordance with U.S. GAAP, this press
release also contains adjusted net income and adjusted earnings per
share measures that we believe 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 income excludes upfront collaboration payments,
amortization of acquired intangible assets and other charges, deal
related charges, restructuring charges, stock-based compensation
expense, changes in contingent consideration, arbitration award,
milestone payments, non-cash interest, impairment charges, gain on
settlement, loss on equity investment, and net income tax adjustments.
See the attached Reconciliations of GAAP to Adjusted Net Income and
Adjusted Earnings Per Share for explanations of the amounts excluded and
included to arrive at adjusted net income and adjusted earnings per
share amounts for the three month periods and year ended December 31,
2014 and December 31, 2013.
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. We typically exclude certain GAAP items that
management does not believe affect our basic operations and that do not
meet the GAAP definition of unusual or non-recurring items. Other
companies may define these measures in different ways.
Forward Looking Statements
Statements contained in this
press release about The Medicines Company that are not purely
historical, and all other statements 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" and "expects" and similar expressions, including the
Company's preliminary financial results, are intended to identify
forward-looking statements. These forward-looking statements involve
important 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 the extent of the commercial
success of Angiomax, the Company's ability to develop its global
operations and penetrate foreign markets, whether the Company's product
candidates will advance in the clinical trials process on a timely basis
or at all, 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; whether physicians, patients and other key decision
makers will accept clinical trial results, 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 Quarterly Report on Form 10-Q
filed on November 7, 2014, which are incorporated herein by reference.
The Company specifically disclaims any obligation to update these
forward-looking statements.
|
|
|
The Medicines Company
|
|
Consolidated Statements of Income
|
|
(Unaudited)
|
|
(in thousands, except per share data)
|
|
|
Three months ended December 31,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
|
$
|
190,998
|
|
|
$
|
185,003
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
|
66,000
|
|
|
76,339
|
|
|
Research and development
|
|
|
53,543
|
|
|
38,522
|
|
|
Selling, general and administrative
|
|
|
106,236
|
|
|
86,004
|
|
|
Total operating expenses
|
|
|
225,779
|
|
|
200,865
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
|
(34,781
|
)
|
|
(15,862
|
)
|
|
Co-promotion and profit share income
|
|
|
8,026
|
|
|
5,142
|
|
|
Loss in equity investment
|
|
|
(527
|
)
|
|
-
|
|
|
Settlement
|
|
|
25,736
|
|
|
-
|
|
|
Interest expense
|
|
|
(3,991
|
)
|
|
(4,388
|
)
|
|
Other income
|
|
|
345
|
|
|
391
|
|
|
Loss before income taxes
|
|
|
(5,192
|
)
|
|
(14,717
|
)
|
|
(Provision) benefit for income taxes
|
|
|
(190
|
)
|
|
15,803
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
|
(5,382
|
)
|
|
1,086
|
|
|
Net loss attributable to non-controlling interest
|
|
|
59
|
|
|
112
|
|
|
Net (loss) income attributable to The Medicines Company
|
|
|
$
|
(5,323
|
)
|
|
$
|
1,198
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings per common share attributable to The
Medicines
Company:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.02
|
|
|
Diluted
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.02
|
|
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
64,800
|
|
|
63,437
|
|
|
Diluted
|
|
|
64,800
|
|
|
69,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Medicines Company
|
|
Consolidated Statements of Income
|
|
|
|
(in thousands, except per share data)
|
|
|
Year ended December 31,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
|
$
|
724,408
|
|
|
$
|
687,864
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
|
287,630
|
|
|
262,785
|
|
|
Research and development
|
|
|
159,181
|
|
|
146,930
|
|
|
Selling, general and administrative
|
|
|
342,164
|
|
|
264,958
|
|
|
Total operating expenses
|
|
|
788,975
|
|
|
674,673
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations
|
|
|
(64,567
|
)
|
|
13,191
|
|
|
Co-promotion and profit share income
|
|
|
24,236
|
|
|
17,383
|
|
|
Loss in equity investment
|
|
|
(1,711
|
)
|
|
-
|
|
|
Settlement
|
|
|
25,736
|
|
|
-
|
|
|
Interest expense
|
|
|
(15,701
|
)
|
|
(15,531
|
)
|
|
Investment Impairment
|
|
|
(7,500
|
)
|
|
-
|
|
|
Other income
|
|
|
322
|
|
|
1,577
|
|
|
(Loss) Income before income taxes
|
|
|
(39,185
|
)
|
|
16,620
|
|
|
Benefit (provision) for income taxes
|
|
|
6,837
|
|
|
(1,360
|
)
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
|
(32,348
|
)
|
|
15,260
|
|
|
Net loss attributable to non-controlling interest
|
|
|
138
|
|
|
252
|
|
|
Net (loss) income attributable to The Medicines Company
|
|
|
$
|
(32,210
|
)
|
|
$
|
15,512
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings per common share attributable to The
Medicines
Company:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
(0.50
|
)
|
|
$
|
0.27
|
|
|
Diluted
|
|
|
$
|
(0.50
|
)
|
|
$
|
0.25
|
|
|
Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
64,473
|
|
|
58,096
|
|
|
Diluted
|
|
|
64,473
|
|
|
62,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet Items
|
|
(in thousands)
|
|
|
December 31,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
370,741
|
|
|
$
|
376,727
|
|
Total assets
|
|
|
$
|
1,885,705
|
|
|
$
|
1,741,282
|
|
Convertible senior notes (due 2017)
|
|
|
$
|
246,676
|
|
|
$
|
236,088
|
|
The Medicines Company stockholders' equity
|
|
|
$
|
920,565
|
|
|
$
|
892,497
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Medicines Company
|
|
Reconciliation of GAAP to Adjusted Net Income and Adjusted
Earnings Per Share
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December
|
|
|
|
|
|
|
31,
|
|
Year ended December 31,
|
|
(in thousands)
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income attributable to The Medicines Company - GAAP
|
|
|
$
|
(5,323
|
)
|
|
$
|
1,198
|
|
|
$
|
(32,210
|
)
|
|
$
|
15,512
|
|
|
Before tax adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expense
|
|
(1)
|
103
|
|
|
84
|
|
|
454
|
|
|
231
|
|
|
Restructuring charges
|
|
(2)
|
-
|
|
|
-
|
|
|
-
|
|
|
581
|
|
|
Amortization of acquired intangible assets
|
|
(3)
|
14,001
|
|
|
10,075
|
|
|
46,853
|
|
|
23,969
|
|
|
Research and development:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expense
|
|
(1)
|
1,136
|
|
|
1,423
|
|
|
5,578
|
|
|
4,053
|
|
|
Restructuring charges
|
|
(2)
|
550
|
|
|
-
|
|
|
550
|
|
|
1,252
|
|
|
Milestone payments
|
|
(4)
|
10,000
|
|
|
-
|
|
|
18,429
|
|
|
25,000
|
|
|
Selling, general and administrative:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based compensation expense
|
|
(1)
|
7,942
|
|
|
5,705
|
|
|
27,885
|
|
|
18,555
|
|
|
Restructuring charges
|
|
(2)
|
8,457
|
|
|
-
|
|
|
8,457
|
|
|
4,525
|
|
|
Amortization of acquired intangible assets
|
|
(3)
|
1,415
|
|
|
1,136
|
|
|
5,657
|
|
|
4,544
|
|
|
Change in contingent purchase price
|
|
(5)
|
7,698
|
|
|
17,110
|
|
|
36,429
|
|
|
16,942
|
|
|
Expenses incurred for certain transactions
|
|
(6)
|
-
|
|
|
2,644
|
|
|
566
|
|
|
9,720
|
|
|
Arbitration award
|
|
(7)
|
-
|
|
|
-
|
|
|
-
|
|
|
5,000
|
|
|
Milestone payment
|
|
(4)
|
-
|
|
|
-
|
|
|
2,500
|
|
|
-
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash interest expense
|
|
(8)
|
3,046
|
|
|
2,851
|
|
|
11,920
|
|
|
11,158
|
|
|
Investment impairment
|
|
(9)
|
-
|
|
|
-
|
|
|
7,500
|
|
|
-
|
|
|
Loss in equity investment
|
|
(10)
|
527
|
|
|
-
|
|
|
1,711
|
|
|
-
|
|
|
Settlement
|
|
(11)
|
(25,736
|
)
|
|
-
|
|
|
(25,736
|
)
|
|
-
|
|
|
Net income tax adjustments
|
|
(12)
|
(10,269
|
)
|
|
(26,846
|
)
|
|
(48,723
|
)
|
|
(49,165
|
)
|
|
Net income attributable to The Medicines
Company - Adjusted
|
|
|
$
|
13,547
|
|
|
$
|
15,380
|
|
|
$
|
67,820
|
|
|
$
|
91,877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share attributable to The Medicines
Company -
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.21
|
|
|
$
|
0.24
|
|
|
$
|
1.05
|
|
|
$
|
1.58
|
|
|
Diluted
|
|
(13)
|
$
|
0.20
|
|
|
$
|
0.23
|
|
|
$
|
1.02
|
|
|
$
|
1.50
|
|
|
Weighted average number of common shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
64,799
|
|
|
63,437
|
|
|
64,473
|
|
|
58,096
|
|
|
Diluted - Adjusted
|
|
(13)
|
66,347
|
|
|
66,864
|
|
|
66,284
|
|
|
61,184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Explanation of Adjustments:
(1) Excludes share-based compensation of $9,181 and $7,212 for three
months ended December 31, 2014 and December 31, 2013, respectively and
$33,917 and $22,839 for the year ended December 31, 2014 and December
31, 2013, respectively.
(2) Excludes restructuring charges relating to the reorganization of our
European operations of $9,007 in 2014 and excludes workforce reduction
charges relating to workforce reduction of $6,358 during 2013.
(3) Excludes amortization of intangible assets and other charges
resulting from transactions with Nycomed, CSL, APP, Teva, Targanta, BMS,
Rempex and Tenaxis.
(4) Excludes upfront and milestone payments for research and development
collaboration arrangements.
(5) Excludes changes in contingent purchase price due to shareholders of
Targanta, Incline Therapeutics, ProFibrix, Rempex and Tenaxis.
(6) Excludes charges related to the acquisition of Incline, ProFibrix,
Rempex and license of Recothrom during 2013 and acquisition of Tenaxis
during 2014.
(7) Excludes one time arbitration award to Eagle.
(8) Excludes non-cash interest expense related to convertible senior
notes.
(9) Excludes write off of impaired investment.
(10) Excludes loss in equity investment.
(11) Reflects impact of one-time income in connection with the
settlement with the former equity holders of Incline.
(12) Net income tax adjustments reflect the estimated tax effect of the
above adjustments and the impact of certain other non-operating tax
adjustments.
(13) Reflects impact of note hedge transactions on outstanding diluted
share amounts and net income per share associated with convertible
senior notes.
In addition to the financial information prepared in accordance with
U.S. GAAP, this press release also contains adjusted financial measures
that we believe 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. We typically exclude certain GAAP items that management
does not believe affect our basic operations and that do not meet the
GAAP definition of unusual or non-recurring items. Other
companies may define these measures in different ways.
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