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Ipsen Delivers Strong Sales Growth of 18.8%1 in the First Half of 2017 and Upgrades Its Guidance for Full Year 2017Regulatory News: Ipsen (Euronext: IPN; ADR: IPSEY), a global specialty-driven biopharmaceutical group, today announced financial results for the first half of 2017. H1 2017 Highlights
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1 Year-on-year growth excluding foreign exchange impacts David Meek, Chief Executive Officer of Ipsen, stated: "Our performance in the first half of 2017 exceeded expectations, leading to an improved financial outlook for the full year. Sales grew in the first half by an impressive 19% year-on-year and core operating margin improved by 1.2 points, both driven by Specialty Care performance. In the second half of the year, we expect Somatuline® to continue along its positive growth trajectory and also an increasing contribution from our new products Cabometyx® in Europe and Onivyde® in the U.S. We remain focused on the successful execution of the commercial portfolio as well as the transformation of our R&D model to build an innovative and sustainable pipeline." Full year 2017 upgraded guidance Following the strong performance in the first half of 2017, the Group updates its financial targets for the full year 2017:
____________________ 1 Year-on-year growth excluding foreign exchange impacts Definition of Core Financial Measures Effective December 31st, 2016, Ipsen updated its definition of Core financial measures (Core Operating income, Core consolidated net profit, Core EPS) to exclude the amortization of intangible assets (excluding software) and the gain or loss on disposal of fixed assets. These performance indicators do not replace IFRS indicators, and should not be relied upon as such. Reconciliations between IFRS H1 2016/2017 results and the newly defined Core financial measures are presented in Appendix 4 and in the "Reconciliation from Core consolidated net profit to IFRS consolidated net profit" table on page 13. Below is a reconciliation of the Core Operating Income from the previous definition to the new reported definition:
Review of the first half 2017 results Note: Unless stated otherwise, all variations in sales are stated excluding foreign exchange impacts. Group sales reached €919.5 million, up 18.8% year-on-year. Specialty Care sales reached €764.6 million, up 23.1%, driven by the strong growth of Somatuline® and the contribution of €28.6 million of key new products Cabometyx® (mainly sales from Germany and France) and Onivyde® (with first sales booked in the second quarter following the closing of the transaction in early April 2017). Somatuline® growth of 31.8% was driven by a continued growth in North America, and a solid performance throughout Europe. Dysport® growth was fueled by the good performance of our partner Galderma in North America and Europe but still impacted by importation issues related to the temporary cancellation of the certificate of Good Manufacturing Practices (cGMP) in Brazil. Decapeptyl® sales reflect good volume growth in most geographies but also some continued price pressure, notably in China. Consumer Healthcare sales reached €154.8 million, driven by the good performance of Smecta® thanks to the retail strategy in China and a positive sales dynamic in Russia, as well as the contribution of the recent acquisitions of new OTC products (including Prontalgine® in France) and the new products from Akkadeas Pharma in Italy. This performance was partly offset by some continued pressure in emerging markets like Algeria and Russia. Core Operating Income totaled €240.5 million, up 25.7%, driven by the strong Specialty Care sales growth and reflects increased commercial investments mainly for the new products Cabometyx® and Onivyde®. Core operating margin reached 26.2% of sales, up 1.2 points. Core consolidated net profit was €169.2 million, compared to €145.7 million in 2016, up 16.2% and impacted by higher financial and income tax expenses. Fully diluted core earnings per share grew by 15.7% to reach €2.04, compared to €1.76 in 2016. IFRS Operating income was €176.4 million, up 1.0% compared to €174.6 million in 2016 after higher amortization of intangible assets from Cabometyx® and Onivyde®, and costs associated primarily with Onivyde® integration and R&D restructuring expenses. Operating income margin at 19.2% is down 3.6 points compared to the first half of 2016. IFRS Consolidated net profit was €125.9 million versus €133.3 million in 2016 after higher financial and income tax expenses. IFRS Fully diluted EPS (Earning per share) was €1.52 versus €1.61 in 2016. Free cash flow reached €94.9 million, up by €21.3 million, driven by the improvement in Operating Cash Flow, partially compensated by higher restructuring costs and financial expenses. Closing net debt reached €669.4 million at the end of June 2017, versus a cash position of €17.3 million at the end of June 2016 reflecting the acquisitions completed during the first half of 2017 for Onivyde®, the Consumer Healthcare product portfolio and the equity stake in Akkadeas Pharma. The interim financial report, with regard to regulated information, is available on the Group's website, www.ipsen.com, under the Regulated Information tab in the Investor Relations section. Conference call for the financial community Ipsen will hold a conference call Thursday 27 July 2017 at 4:00 p.m. (Paris time, GMT+1). Participants should dial in to the call approximately 5 to 10 minutes prior to its start. No reservation is required to participate in the conference call.
France and continental Europe: +33 (0)1 7099 3534
A recording will be available for 7 days on Ipsen's website and at the
following numbers: About Ipsen Ipsen is a global specialty-driven biopharmaceutical group focused on innovation and specialty care. The group develops and commercializes innovative medicines in three key therapeutic areas - Oncology, Neurosciences and Rare Diseases. Its commitment to oncology is exemplified through its growing portfolio of key therapies for prostate cancer, neuroendocrine tumors, renal cell carcinoma and pancreatic cancer. Ipsen also has a well-established Consumer Healthcare business. With total sales close to €1.6 billion in 2016, Ipsen sells more than 20 drugs in over 115 countries, with a direct commercial presence in more than 30 countries. Ipsen's R&D is focused on its innovative and differentiated technological platforms located in the heart of the leading biotechnological and life sciences hubs (Paris-Saclay, France; Oxford, UK; Cambridge, US). The Group has about 5,100 employees worldwide. Ipsen is listed in Paris (Euronext: IPN) and in the United States through a Sponsored Level I American Depositary Receipt program (ADR: IPSEY). For more information on Ipsen, visit www.ipsen.com. Forward Looking Statement The forward-looking statements, objectives and targets contained herein are based on the Group's management strategy, current views and assumptions. Such statements involve known and unknown risks and uncertainties that may cause actual results, performance or events to differ materially from those anticipated herein. All of the above risks could affect the Group's future ability to achieve its financial targets, which were set assuming reasonable macroeconomic conditions based on the information available today. Use of the words "believes," "anticipates" and "expects" and similar expressions are intended to identify forward-looking statements, including the Group's expectations regarding future events, including regulatory filings and determinations. Moreover, the targets described in this document were prepared without taking into account external growth assumptions and potential future acquisitions, which may alter these parameters. These objectives are based on data and assumptions regarded as reasonable by the Group. These targets depend on conditions or facts likely to happen in the future, and not exclusively on historical data. Actual results may depart significantly from these targets given the occurrence of certain risks and uncertainties, notably the fact that a promising product in early development phase or clinical trial may end up never being launched on the market or reaching its commercial targets, notably for regulatory or competition reasons. The Group must face or might face competition from generic products that might translate into a loss of market share. Furthermore, the Research and Development process involves several stages each of which involves the substantial risk that the Group may fail to achieve its objectives and be forced to abandon its efforts with regards to a product in which it has invested significant sums. Therefore, the Group cannot be certain that favorable results obtained during pre-clinical trials will be confirmed subsequently during clinical trials, or that the results of clinical trials will be sufficient to demonstrate the safe and effective nature of the product concerned. There can be no guarantees a product will receive the necessary regulatory approvals or that the product will prove to be commercially successful. If underlying assumptions prove inaccurate or risks or uncertainties materialize, actual results may differ materially from those set forth in the forward-looking statements. Other risks and uncertainties include but are not limited to, general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of pharmaceutical industry regulation and health care legislation; global trends toward health care cost containment; technological advances, new products and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approval; the Group's ability to accurately predict future market conditions; manufacturing difficulties or delays; financial instability of international economies and sovereign risk; dependence on the effectiveness of the Group's patents and other protections for innovative products; and the exposure to litigation, including patent litigation, and/or regulatory actions. The Group also depends on third parties to develop and market some of its products which could potentially generate substantial royalties; these partners could behave in such ways which could cause damage to the Group's activities and financial results. The Group cannot be certain that its partners will fulfil their obligations. It might be unable to obtain any benefit from those agreements. A default by any of the Group's partners could generate lower revenues than expected. Such situations could have a negative impact on the Group's business, financial position or performance. The Group expressly disclaims any obligation or undertaking to update or revise any forward looking statements, targets or estimates contained in this press release to reflect any change in events, conditions, assumptions or circumstances on which any such statements are based, unless so required by applicable law. The Group's business is subject to the risk factors outlined in its registration documents filed with the French Autorité des Marchés Financiers. The risks and uncertainties set out are not exhaustive and the reader is advised to refer to the Group's 2016 Registration Document available on its website (www.ipsen.com). Comparison of consolidated sales for the second quarter and first half of 2017 and 2016: Sales by therapeutic area and by product1 Note: Unless stated otherwise, all variations in sales are stated excluding foreign exchange impacts. The following table shows sales by therapeutic area and by product for the second quarter and first half of 2017 and 2016:
____________________ 1 New sales reporting according to the main therapeutic indication of each product Sales amounted to €919.5 million, up 18.8% year-on-year, driven by 23.1% growth of Specialty Care sales, and 1.3% growth of Consumer Healthcare sales. Sales of Specialty Care reached €764.6 million, up 23.1% year-on-year. Oncology and Neurosciences sales grew by 29.0% and 13.8%, respectively, while Rare Diseases sales decreased by 6.7%. Over the period, the relative weight of Specialty Care continued to increase to reach 83.2% of Group sales, compared to 80.3% in the previous year. In Oncology, sales reached €560.8 million, up 29.0%, year-on-year, driven by the launch of Onivyde® and Cabometyx®, as well as the continued strong performance of Somatuline® while Decapeptyl® was slightly up by 2.5%. Oncology sales represented 61.0% of total Group sales, compared to 56.5% in the previous year. Somatuline® - Sales reached €340.4 million, up 31.8% year-on-year, driven by a strong volume and continuous market share growth in North America as well as a good performance in most European countries, notably in France, Germany, and the UK. Decapeptyl® - Sales reached €171.0 million, up 2.5% year-on-year, positively impacted by good sales trends in Europe, in Algeria and East Middle East, despite price pressure in China and Poland. Cabometyx® - Sales reached €16.9 million, mainly driven by the good performance in France and Germany, which accounted for the majority of product sales. Onivyde® - Sales reached €19.3 million registering first sales during the second quarter following completion of the acquisition from Merrimack in April 2017. In Neurosciences, sales of Dysport® reached €163.6 million, up 13.6% year-on-year, driven by the good performance of our partner Galderma in aesthetics in North America and Europe, offset by the sales decrease in Brazil due to temporary importation issues. Neurosciences sales represented 18.0% of total Group sales, compared to 18.4% in the previous year. In Rare Diseases, sales of NutropinAq® reached €27.1 million, down 10.4% year-on-year, impacted by lower volumes especially in Germany and France. Sales of Increlex® reached €11.3 million, up 3.8% year-on-year, driven by the United States. Rare Diseases sales represented 4.2% of total Group sales, compared to 5.4% in the previous year. Consumer Healthcare sales reached €154.8 million, up 1.3% year-on-year, driven by the portfolio of products acquired in May 2017, and the equity stake in Akkadeas Pharma (Italy) acquired in January 2017. Over the period, Consumer Healthcare sales represented 16.8% of total Group sales, compared to 19.7% in the previous year. Smecta® - Sales reached €58.8 million, up 6.6% year-on-year, driven by the favorable impact of the OTC strategy in China, the Diosmectal re-launch in Italy following the acquisition of an equity stake in Akkadeas Pharma in 2017, and a good sales dynamic in Russia, partly offset by a sales decrease in Vietnam due to an inventory build-up in early 2016 for the license renewal. Forlax® - Sales reached €21.3 million, up 5.0% year-on-year, supported by growing sales to partners, partly offset by importation issues in Algeria. Tanakan® - Sales reached €15.5 million, down 19.8% year-on-year due to a continuous market slowdown in France and Russia. Fortrans®/Eziclen® - Sales reached €15.8 million, up 15.7% year-on-year helped by favorable base of comparison after Fortrans® shortage issues in the first half of 2016. Etiasa® - Sales reached €9.4 million, up 2.2% year-on-year including impact of new distribution model in China. Other Consumer Healthcare products sales reached €34.1 million (including €1.9 million for the first sales of Prontalgine®), down 3.3% year-on-year, mainly affected by the decline and price cut of Nisis®/Nisisco® and by Adrovance® underperformance, down 16.8% over the period. Sales by geographical area Group sales by geographical area in the second quarter and first half of 2017 and 2016 were as follows:
Sales in Major Western European countries reached €317.2 million, up 11.8%. Sales in Major Western European countries represented 34.5% of total Group sales, compared to 37.6% in 2016. France - Sales reached €124.2 million, up 11.4% year-on-year, driven by the sustained growth of Somatuline® and the Cabometyx® launch contribution. Consumer Healthcare sales are up due to the acquisition of Prontalgine®, partly offset by lower sales of Tanakan®, Adrovance® and Nisis®/Nisisco®. Germany - Sales reached €70.3 million, up 15.5% year-on-year, driven by the Cabometyx® sales and the strong growth of Somatuline®. Italy - Sales reached €48.9 million, up 13.9% year-on-year, driven by the equity stake in Akkadeas Pharma acquired in January 2017, and the growth of Somatuline® and Decapeptyl®. United Kingdom - Sales reached €38.4 million, up 14.4% year-on-year, driven by Somatuline® and Decapeptyl® growth. Spain - Sales reached €35.4 million, up 1.3% year-on-year, mainly driven by Somatuline®, but impacted by lower sales in Rare Diseases. Sales in Other European countries reached €194.4 million, up 10.6% year-on-year, supported by the strong performance of Dysport® across the region and the launch of Cabometyx® in certain countries. Sales generated in North America reached €220.3 million, up 81.3% year-on-year, supported by the continued strong growth of Somatuline® and the good performance of Galderma for Dysport® in the aesthetics market. Sales in North America represented 24.0% of total Group sales, compared to 15.5% in 2016. Sales in the Rest of the World reached €187.5 million, down 2.4% year-on-year, impacted by unfavorable inventory effects on Smecta® in Vietnam, on Decapeptyl® in the Middle East, on Dysport® in Southeast Asia and Brazil and on Bedelix® following import difficulties in Algeria. Comparison of Core consolidated income statement for the first half of 2017 and the first half of 2016 Core financial measures are performance indicators. Reconciliation between these indicators and IFRS aggregates is presented in Appendix 4 "Bridges from IFRS consolidated net profit to Core consolidated net profit"
For the six months ended 30 June 2017, the Group's consolidated sales came to €919.5 million, up 20.4% year-on-year and up 18.8% excluding the impact of foreign exchange.
Other revenues for the first half of 2017 totaled €50.2 million, up 17.4% versus €42.8 million generated in the six-month period ended 30 June 2016. The evolution was attributable to higher royalties received from Group partners, mainly Galderma for Dysport® and Menarini for Adenuric®.
For the six months ended 30 June 2017, Cost of goods sold amounted to €190.2 million, representing 20.7% of sales compared to €172.2 million, or 22.5% of sales, in the six-month period ended 30 June 2016. The improvement in Cost of goods sold as a percentage of net sales was mainly driven by a favorable product mix from the growth in Specialty Care sales. Royalties paid to partners increased due to the growth of Group sales.
For the six months ended 30 June 2017, Selling expenses came to €349.6 million, representing 38.0% of sales, up 23.5% versus the six months ended 30 June 2016. The increase reflects the commercial efforts deployed to support the Cabometyx® launch in Europe, the growth of Somatuline® in the United States as well as the commercial investment for Onivyde® in the United States after the closing of the acquisition in April.
For the half-year period ended 30 June 2017, Research and development expenses totaled €115.0 million, compared to €95.0 million in the same period in 2016. The Group is strengthening its Oncology capabilities and increased development costs for Cabometyx®, the peptide receptor radionuclide therapy program and Onivyde®. In Neurosciences, the short acting toxin entered into the clinical phase, leading to a progressive increase of costs. At 30 June 2017, the research tax credit amounted to €13.3 million, up €0.9 million versus 2016.
For the six months ended 30 June 2017, General and administrative expenses came to €68.3 million, up €9.2 million versus the same period in 2016. The increase resulted primarily from the strengthening of the structure to support the Onivyde® acquisition in the United States as well as to the impact of the Group's positive performance on variable compensation.
In the first half of 2017, Other core operating expenses totaled €6.0 million, in line with the first half of 2016.
Core Operating Income in the first half of 2017 came to €240.5 million, representing 26.2% of sales, compared to €191.3 million in Core Operating Income in the first half of 2016, representing 25.0% of sales. The strong performance of Specialty Care including the contribution from new products Cabometyx® and Onivyde®, combined with higher commercial investments enabled the Group to increase its profitability by 1.2 points. The growth of Core Operating Income between the first half of 2017 and 2016 reached 25.7%.
In the first half of 2017, the Group incurred net financial expenses of €11.6 million, versus €2.9 million in the first half of 2016. Net financing costs amounted to €4.2 million, versus €1.1 million in 2016, driven by interest expenses on the bond issued in June 2016 and by financing costs related to the acquisitions completed during this semester. In the first half of 2017, Other financial income and expense amounted to an expense of €7.5 million, compared to €1.8 million in the first half of 2016, driven by the cost of hedging implemented to mitigate the foreign exchange risk of the Group.
In the first half of 2017, Core income tax expense of €60.7 million resulted from a core effective tax rate of 26.5% on pre-tax profit compared to a core effective rate of 23.4% in 2016. This increase is mainly attributable to the increase of unrecognized deferred tax assets in the United States and Germany.
For the six months ended 30 June 2017, Core consolidated net profit increased by 16.2% to €169.2 million, fully attributable to Ipsen S.A. shareholders. This compares to Core consolidated net profit of €145.7 million, with €145.3 million attributable to Ipsen S.A. shareholders, at the end of June 2016.
At the end of June 2017, Core EPS fully diluted came to €2.04, up 15.7% versus €1.76 per share at the end of June 2016. From Core financial measures to IFRS reported figures Reconciliations between IFRS 2016 / 2017 half-year results and the Core financial measures are presented in Appendix 4. In the first half of 2017, the main reconciling items between Core consolidated net income and IFRS consolidated net income were:
Amortization of intangible assets (excluding software) for the six months ended 30 June 2017 amounted to €21.5 million before tax, compared to €2.2 million before tax in the first half of 2016. This variance consisted mainly of the amortization of the intangible assets for Cabometyx® and Onivyde®.
Other non-core operating expenses for the six months ended 30 June 2017 amounted to €34.8 million before tax and Restructuring costs came to €7.9 million before tax. Those expenses consisted mainly of integration costs related to the Onivyde® acquisition, the adaptation of the R&D structure and programs and a settlement with a partner in Japan. In the first half of 2016, Other non-core operating expenses totaled €5.8 million before tax and consisted mainly of costs from the change in the Group's corporate governance and costs from the move to the new research and development site in Oxford, UK. Restructuring costs were €0.4 million before tax at the end of June 2016.
In the first half of 2017, no impairment loss was recognized in the Group accounts. In the first half of 2016, Ipsen recorded an impairment for €8.4 million before tax, on MCNA intangible assets acquired from Telesta Therapeutics.
In the first half of 2017, Other items amounted to €1.6 million and was related to discontinued operations, while in the first half of 2016, Other items amounted to € 0.3 million. As a consequence, IFRS reported indicators are:
In the first half of 2017, Operating income totaled €176.4 million in line with last year, with an Operating margin at 19.2%, down 3.7 points compared to the first half of 2016.
Consolidated net profit was €125.9 million at 30 June 2017, decreasing by 5.5% versus last year at €133.3 million.
Fully diluted EPS was €1.52 at 30 June 2017 versus €1.61 last year. Operating segments: Core Operating Income by therapeutic area Segment information is presented according to the Group's two operating segments, Specialty Care and Consumer Healthcare. All costs allocated to these two segments are presented in the key performance indicators. Only corporate overhead costs and the impact of the currency hedging policy are not allocated to the two operating segments. Research and development costs are allocated to the operating segments while formerly included in Unallocated. The Group uses Core Operating Income to measure its segment performance and to allocate resources. Sales, revenue and Core Operating Income are presented by therapeutic area for the 2017 and 2016 half-year periods in the following table.
For the half year period ended 30 June 2017, Specialty Care sales grew to €764.6 million, up 24.6% over the first six months of 2017 (or 23.1% at constant exchange rate), driven by the contribution of the two new products Onivyde® and Cabometyx® and the strong growth of Somatuline®. The relative weight of Specialty Care products continued to increase, reaching 83.2% of total consolidated sales at 30 June 2017, versus 80.3% a year earlier. In the first half of 2017, Core Operating Income for Specialty Care amounted to €281.3 million, representing 36.8% of sales. This compares to €214.8 million in the prior-year period, representing 35.0% of sales. The improvement reflects Somatuline® continued sales growth in the United States and Europe and the Cabometyx® and Onivyde® incremental sales, along with increased commercial investments to support growth and launches. For the six months ended 30 June 2017, sales of Consumer Healthcare products came to €154.8 million, up 3.0% year on year, driven by the good performance of Smecta® and the portfolio of Sanofi products acquired in May 2017. In the first half of 2017, Core Operating Income for Consumer Healthcare amounted €47.1 million, representing 30.4% of sales in comparison of 35.8% at 30 June 2016. This variance reflects the commercial efforts deployed to support the implementation of the OTx strategy as well as an increase in medical studies expenses. In the first half of 2017, Unallocated Core Operating Income came to a negative €87.8 million, compared to a negative €77.3 million in the year-earlier period. The evolution is mainly attributable to the Group's positive performance on higher variable compensation and investments to support Ipsen's growth. These expenses consisted mainly of unallocated corporate expenses and of the impact from the currency hedging policy. Net cash flow and financing In the first half of 2017, the Group had a net cash decrease of €738.0 million after the acquisition of the Onivyde® assets, OTC products portfolio including Prontalgine® and the equity stake in Akkadeas Pharma, bringing closing net debt to €669.4 million.
At 30 June 2017, Operating Cash Flow totaled €143.4 million, up €26.4 million (+22.6%) versus 30 June 2016. The increase was driven by higher Core Operating Income, partially offset by an increase in working capital requirement (WCR) and net capital expenditure (excluding milestones paid). Working capital requirement for operating activities increased by €35.4 million at 30 June 2017, compared with an increase of €26.3 million at 30 June 2016. The change at 30 June 2017 stemmed mainly from the following:
In the first half of 2017, other WCR need increased by €20.0 million. This increase was mainly driven by negative seasonality on working capital components (including the payment of variable compensation and VAT), partially compensated by the reimbursement of R&D tax credit. The other WCR increased by €8.9 million in the first half of 2016. Net capital expenditure advanced €2.3 million year-on-year to €37.2 million at 30 June 2017. These investments were aimed at reinforcing the production capacity at the United Kingdom and France industrial sites.
At 30 June 2017, Free Cash Flow came to €94.9 million, up €21.3 million (+28.9%) versus 30 June 2016. This evolution is mainly driven by an improvement in Operating Cash Flow, partially compensated by higher Other operating income or expenses and restructuring costs, and increased Financial expenses. Other non-core operating income and expenses and restructuring costs of €18.3 million included Onivyde® integration costs as well as the impact of the transformation of the R&D model. At the end of June 2016, €10.2 million of such payments were primarily comprised in costs arising from the change in corporate governance, as well as payments for earlier restructuring plans that were staggered over several fiscal periods. The €9.1 million in financial expenses paid at end June 2017 resulted from interests on the bond issued in June 2016 and hedging costs. In comparison, the €2.3 million in financial income collected at end June 2016 resulted mainly from the collection of dividends, an earnout payment related to the sale of Spirogen shares and realized foreign exchange gains. The change in current income tax stemmed mainly from the change in the effective tax rate.
At 30 June 2017, the dividend payout to Ipsen S.A. shareholders amounted to €70.2 million. Net investments at 30 June 2017 amounted to €760 million, including the acquisition of Onivyde® assets from Merrimack Pharmaceuticals on April 3rd for €666 million including the purchase price and future earn-outs (discounted and probabilized under IFRS), the acquisition of Consumer Healthcare products in European territories from Sanofi for €86 million and the equity stake in Akkadeas Pharma for €5 million as well as an additional commercial milestone paid to Exelixis for €9 million following the exclusive licence agreement signed in 2016. This was partially offset by a €8 million regulatory milestone payment received from Radius. At 30 June 2016, net financial investments mainly encompassed a €184 million upfront payment to Exelixis for the exclusive licensing agreement for cabozantinib and a €5 million upfront payment to 3B Pharmaceuticals GmbH, partially offset by regulatory milestone payments received from Acadia and Radius (€10 million) and by scheduled payments related to the agreement signed with Galderma in December 2015 for Asia-Pacific markets (€7 million). Reconciliation of cash and cash equivalents and net cash
On 16 June 2016, Ipsen S.A. issued €300 million unsecured seven-year public bond loan with an annual interest rate of 1.875%. In addition, €300 million in bilateral long term bank loans were contracted with a maturity of 6.5 years. At 30 June 2017, none of this bank loans have been drawn down. On 6 June 2017, Ipsen S.A. has amended its syndicated loan to increase the facility amount from €300 million to €600 million and to extend its maturity until 17 October 2022. This syndicated loan does not contain any financial covenants. At 30 June 2017, €89 million were drawn on this facility. On 27 June 2017, Ipsen S.A. increased its program of emission of NEU CP - Negotiable European Commercial Paper, from €300 million to €600 million, among which €312 million were issued on 30 June 2017. APPENDICES
? Appendix 3.2 - Consolidated statement of net cash flow
(a) Impact of change in consolidation scope reflects the recent acquisitions of Onivyde® assets from Merrimack Pharmaceuticals and the equity stake in Akkadeas Pharma. (b) Milestones paid correspond to payments subject to the terms and conditions set out in the Group's partnership agreements. The €9 million milestone paid to Exelixis accounted for the majority of the milestones paid at 30 June 2017. The amounts paid were recorded as an increase in intangible assets on the consolidated balance sheet. The transactions were included in the "Acquisition of intangible assets" line item in the consolidated statement of cash flow (see Appendix 3.1). (c) Milestones received are amounts collected by Ipsen from its partners. The €8 million milestone received at 30 June 2017 were paid by Radius. The amounts were recorded as deferred income in the consolidated balance sheet and then recognized in the income statement as "Other revenues". Milestones received were included in the "Net change in other operating assets and liabilities" line item in the consolidated statement of cash flow (see Appendix 3.1).
The reconciliation items between Core consolidated net profit and IFRS consolidated net profit are described in the paragraph "From Core financial measures to IFRS reported figures".
MAJOR DEVELOPMENTS During the first semester 2017, major developments included:
APPENDIX RISK FACTORS The Group operates in an environment which is undergoing rapid change and exposes its operations to a number of risks, some of which are outside its control. The risks and uncertainties set out below are not exhaustive and the reader is advised to refer to the Group's 2016 Registration Document available on its website (www.ipsen.com).
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