— Strong total net product sales of $3.8
billion, increased 17% Y/Y
— Raising full-year total revenue guidance to
~$15 billion and REVLIMID® net sales to ~$9.7 billion
— Advancing late-stage next-generation growth
drivers
Celgene Corporation (NASDAQ:CELG) reported net product sales of
$3,808 million for the second quarter of 2018, a 17 percent
increase from the same period in 2017. Celgene reported second
quarter 2018 total revenue of $3,814 million, a 17 percent increase
compared to $3,271 million in the second quarter of 2017.
Based on U.S. GAAP (Generally Accepted Accounting Principles),
Celgene reported net income of $1,045 million and diluted earnings
per share (EPS) of $1.43 for the second quarter of 2018. For the
second quarter of 2017, GAAP net income was $1,101 million and
diluted EPS was $1.36.
Adjusted net income for the second quarter of 2018 increased 5
percent to $1,585 million compared to $1,514 million in the second
quarter of 2017. For the same period, adjusted diluted EPS
increased 16 percent to $2.16 (including dilution from the Juno
Therapeutics acquisition) from $1.87.
“We continued to deliver strong operating performance in the
second quarter, leading us to update our 2018 financial guidance,”
said Mark J. Alles, Chairman and Chief Executive Officer of Celgene
Corporation. “Our next innovation cycle is underway. We are
meaningfully advancing our pipeline, while strengthening the
organization to maximize future growth opportunities.”
Second Quarter 2018 Financial
Highlights
Unless otherwise stated, all comparisons are for the second
quarter of 2018 compared to the second quarter of 2017. The
adjusted operating expense categories presented below exclude
share-based employee compensation expense, collaboration-related
upfront expense 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 second quarter
increased 21 percent to $2,453 million. REVLIMID® sales continue to
grow, driven by increases in market share and extended treatment
duration. U.S. sales of $1,586 million and international sales of
$867 million increased 17 percent and 28 percent year-over-year,
respectively. International sales were also favorably impacted by
customer buying patterns and sales of product for use in clinical
trials.
- POMALYST®/IMNOVID® sales for the second
quarter were $507 million, an increase of 30 percent
year-over-year. U.S. sales were $341 million and international
sales were $166 million, an increase of 41 percent and 11 percent
year-over-year, respectively. POMALYST®/IMNOVID® sales growth was
driven primarily by increases in market share and treatment
duration.
- OTEZLA® sales for the second quarter
were $375 million, a 5 percent increase year-over-year. Second
quarter U.S. sales of $291 million and international sales of $84
million decreased 5 percent and increased 62 percent
year-over-year, respectively. OTEZLA® sales in the U.S. were driven
primarily by increasing demand with continued access pull-through
in contracted health plans that was offset by lower customer
inventory levels at the end of the second quarter of 2018. The
strong momentum of OTEZLA® adoption continued in key international
markets with significant growth acceleration in Japan.
- ABRAXANE® sales for the second quarter
were $243 million, a 4 percent decrease year-over-year. U.S. sales
were $152 million and international sales were $91 million, a
decrease of 6 percent and 2 percent year-over-year,
respectively.
- In the second 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 $230 million compared to $222 million in the
second quarter of 2017.
Research and Development (R&D)
On a GAAP basis, R&D expenses were $1,251 million for the
second quarter of 2018 compared to $835 million for the same period
in 2017. Adjusted R&D expenses were $948 million for the second
quarter of 2018 compared to $690 million for the second quarter of
2017. The increase was driven by the inclusion of R&D expenses
associated with the acquisition of Juno and regulatory
submission-related work on multiple programs. Additional R&D
expenses only included on a GAAP basis increased 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 $790 million for the
second quarter of 2018 compared to $939 million for the same period
in 2017. Adjusted SG&A expenses were $672 million for the
second quarter of 2018 compared to $532 million for the second
quarter of 2017. The current period included an increase in
SG&A expense associated with the acquisition of Juno and
marketing-related expenses. Additional SG&A expenses only
included on a GAAP basis decreased 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 $1.2 billion in the second quarter of
2018, compared to $1.6 billion for the second quarter of 2017. In
May 2018, we entered into an accelerated share repurchase (ASR)
agreement to repurchase an aggregate of $2 billion of our
common stock. During the second quarter of 2018, we purchased 32.8
million of our shares for $3.3 billion, including the $2 billion
paid for the ASR for which we have received a partial delivery of
approximately 18 million shares. We anticipate the remaining shares
from the ASR will be received in the third quarter of 2018. As of
June 30, 2018, Celgene had approximately $2.8 billion remaining
under its stock repurchase program. Celgene ended the quarter with
approximately $3.4 billion in cash, cash equivalents, marketable
debt securities and publicly-traded equity securities.
Celgene Expects Volume-Driven Product
Sales and Earnings Growth in 2018
Previous 2018 guidance Updated 2018
guidance Total Revenue ~$14.8B ~$15.0B
REVLIMID® Net Product Sales ~ $9.5B ~$9.7B POMALYST®/IMNOVID® Net
Product Sales ~ $2.0B Unchanged OTEZLA® Net Product Sales ~$1.5B
Unchanged ABRAXANE® Net Product Sales ~$1.0B Unchanged GAAP
Operating Margin ~ 38% ~35% GAAP Diluted EPS ~ $6.31 $5.95-$6.25
Adjusted Operating Margin
Adjusted Diluted EPS
~56.0%
~$8.45
Unchanged
$8.70-$8.75
Adjusted Tax Rate ~17% Unchanged Weighted Average Diluted Shares
~755M ~735M
Portfolio Updates
- In July, Celgene announced that the
phase III AUGMENT® trial evaluating REVLIMID® in combination with
rituximab (R2) in patients with relapsed and/or refractory
follicular lymphoma and marginal zone lymphoma met the primary
endpoint of progression-free survival (PFS). Data from the AUGMENT®
trial will be submitted to a future medical meeting. Global
regulatory submissions are planned for the first quarter of
2019.
- In June and July, Celgene and Acceleron
Pharma announced that luspatercept achieved all primary and key
secondary endpoints in the phase III MEDALIST® and BELIEVE® trials
in patients with low-to-intermediate risk myelodysplastic syndromes
(MDS) and transfusion-dependent beta-thalassemia, respectively.
Data from the MEDALIST® and BELIEVE® trials will be submitted to a
future medical meeting in 2018. Regulatory applications for
luspatercept in the United States and Europe are planned for the
first half of 2019.
- At the 2018 American Society of
Clinical Oncology (ASCO) Annual Meeting in June, data were
presented on Celgene’s pipeline assets and marketed products
including:
- Updated durability and safety data from
the TRANSCEND NHL-001 trial evaluating liso-cel (JCAR017) in
patients with relapsed and/or refractory aggressive non-Hodgkin
lymphoma (NHL).
- In collaboration with partner bluebird
bio, updated data from the CRB-401 phase I trial evaluating bb2121
in patients with relapsed and/or refractory multiple myeloma
(RRMM).
- Results from the phase III OPTIMISMM®
trial evaluating POMALYST® in combination with bortezomib and
dexamethasone (PVd) in patients with second-line multiple
myeloma.
- Results from the phase III RELEVANCE®
trial evaluating REVLIMID® in combination with rituximab in
patients with previously untreated follicular lymphoma (FL).
- Results from the Merck sponsored phase
III KEYNOTE-407 trial evaluating KEYTRUDA® (pembrolizumab) in
combination with ABRAXANE® as first-line treatment for metastatic
squamous non-small cell lung cancer (NSCLC).
- PFS and safety analysis from the
Genentech-sponsored phase III IMpower131 trial evaluating
TECENTRIQ® (atezolizumab) plus chemotherapy (carboplatin and
ABRAXANE®) as first-line treatment in patients with advanced
squamous NSCLC.
- In May, Roche announced that the phase
III IMpower130 trial evaluating TECENTRIQ® plus chemotherapy
(carboplatin and ABRAXANE®) in patients with metastatic
non-squamous NSCLC met its co-primary endpoints of overall survival
and PFS. Additionally, in July, Roche announced that the phase III
IMpassion130 trial with ABRAXANE® in combination with TECENTRIQ® in
patients with metastatic or locally advanced triple negative breast
cancer met its co-primary endpoint of PFS. Data from these trials
will be presented at a future medical meeting.
- The phase I TRANSCEND CLL-004 trial
evaluating liso-cel in patients with relapsed and/or refractory
chronic lymphocytic leukemia (CLL) continues to enroll. The phase
III TRANSFORM (BCM-003) trial evaluating liso-cel as second-line
therapy in patients with diffuse large B-cell lymphoma (DLBCL) who
are eligible for transplantation is initiating. In addition, the
phase II trial (PILOT) evaluating liso-cel as second-line therapy
in patients with DLBCL who are not eligible for transplantation was
initiated in May.
Organizational Updates
- In May, Celgene announced the hiring of
David V. Elkins as Executive Vice President (EVP) and Chief
Financial Officer (CFO) and the appointment of Peter N. Kellogg to
EVP, Chief Corporate Strategy Officer until his retirement planned
for mid-2019. Mr. Elkins joined Celgene as EVP on July 1, 2018 and
will succeed Peter Kellogg as CFO effective August 1, 2018.
- In June, Celgene announced the
appointment of Jonathan Biller as EVP and General Counsel effective
July 3, 2018, following the departure of Gerald F. Masoudi.
Second Quarter 2018 Conference Call and Webcast
Information
Celgene will host a conference call to discuss the second
quarter of 2018 operational and financial performance on Thursday,
July 26, 2018, at 9 a.m. ET. The conference call will be available
by webcast at http://www.celgene.com. An audio replay of the call
will be available from noon July 26, 2018, until midnight ET August
2, 2018. To access the replay in the U.S., dial (855) 859-2056;
outside the U.S. dial (404) 537-3406. The participant passcode is
2194616.
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.
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 six-month periods ended
June 30, 2018 and 2017, and for the projected amounts for the
twelve-month period ending December 31, 2018.
Celgene Corporation and Subsidiaries Condensed
Consolidated Statements of Operations (Unaudited) (In
millions, except per share data)
Three-Month Periods Ended Six-Month Periods Ended June 30,
June 30, 2018 2017* 2018 2017*
Net product sales $ 3,808 $ 3,259 $ 7,339 $ 6,211 Other revenue
6 12 13 22
Total revenue 3,814 3,271 7,352
6,233 Cost of goods sold (excluding
amortization of acquired intangible assets) 126 111 261 224
Research and development 1,251 835 3,454 1,830 Selling, general and
administrative 790 939 1,654 1,559 Amortization of acquired
intangible assets 127 88 214 170 Acquisition related charges
(income) and restructuring, net 34 (13 )
65 26 Total costs and expenses
2,328 1,960 5,648 3,809
Operating income 1,486 1,311 1,704 2,424
Interest and investment income, net 9 24 22 39 Interest (expense)
(192 ) (126 ) (358 ) (253 ) Other income (expense), net 4
(31 ) 969 (18 ) Income
before income taxes 1,307 1,178 2,337 2,192 Income tax
provision 262 77 446
159 Net income $ 1,045 $ 1,101 $
1,891 $ 2,033 Net income per common
share: Basic $ 1.46 $ 1.41 $ 2.58 $ 2.61 Diluted $ 1.43 $ 1.36 $
2.52 $ 2.51 Weighted average shares: Basic 716.1 780.4 732.1
779.7 Diluted 732.6 811.7 750.6 811.5 * During the third
quarter of 2017, we adopted ASU 2017-12 with an initial application
date of January 1, 2017. Prior to the adoption of ASU 2017-12, we
recognized all changes in the fair value of the excluded component
of a hedge in Other income (expense), net in the Consolidated
Statements of Income under a mark-to-market approach. Pursuant to
the provisions of ASU 2017-12, we no longer recognize the
adjustments to the fair value of the excluded component in Other
income (expense), net but we instead recognize the initial value of
the excluded component using an amortization approach over the life
of the hedging instrument. The results for the three- and six-month
periods ended June 30, 2017 have been recast to reflect the
adoption of ASU 2017-12. The three- and six-month periods ended
June 30, 2017 include the following immaterial revisions to
previously issued financial results: Three-Month Period
Ended Six-Month Period Ended June 30, 2017 June 30,
2017 As Reported As Revised As Reported As Revised
Net product sales $ 3,256 $ 3,259 $ 6,206 $ 6,211 Other income
(expense), net (76 ) (31 ) (50 ) (18 ) Income tax provision 69 77
153 159 Net income 1,061 1,101 2,002 2,033 Diluted net income per
common share $ 1.31 $ 1.36 $ 2.47 $ 2.51 June 30,
December 31, 2018 2017
Balance sheet
items: Cash, cash equivalents, debt securities
available-for-sale and equity investments with readily determinable
fair values $ 3,410 $ 12,042 Total assets 33,444 30,141 Long-term
debt, including current portion 20,256 15,838 Total stockholders'
equity 3,430 6,921
Celgene Corporation and
Subsidiaries Reconciliation of GAAP to Adjusted Net
Income (In millions, except per share data)
Three-Month Periods Ended
Six-Month Periods Ended June 30, June 30, 2018 2017*
2018 2017* Net income - GAAP $ 1,045 $ 1,101 $
1,891 $ 2,033 Before tax adjustments: Cost of goods sold
(excluding amortization of acquired intangible assets): Share-based
compensation expense (1) 9 8 18 15 Research and development:
Share-based compensation expense (1) 157 70 356 135
Collaboration-related upfront expense (2) 146 75 391 85 Research
and development asset acquisition expense (3) - - 1,125 325
Adjustment to clinical trial and development activity wind-down
charge (4) - - (60 ) - Selling, general and administrative:
Share-based compensation expense (1) 118 92 311 173
Litigation-related loss contingency accrual expense (5) - 315 - 315
Amortization of acquired intangible assets (6) 127 88 214
170 Acquisition related charges (income) and restructuring,
net: Change in fair value of contingent consideration and success
payments (7) 7 (13 ) (23 ) 26 Acquisition related charges (8) 27 -
88 - Other income (expense), net: Change in fair value of
equity investments (9) 6 - (953 ) - Income tax provision:
Estimated tax impact from above adjustments (10) (52 ) (127 ) (185
) (238 ) Non-operating tax adjustments (11) (5 ) (95
) (16 ) (170 ) Net income - Adjusted $ 1,585 $
1,514 $ 3,157 $ 2,869 Net income per
common share - Adjusted Basic $ 2.21 $ 1.94 $ 4.31 $ 3.68 Diluted $
2.16 $ 1.87 $ 4.21 $ 3.54 Explanation of adjustments: (1)
Exclude share-based compensation expense totaling $284 and
$170 for the three-month periods ended June 30, 2018 and 2017,
respectively. Exclude share-based compensation expense totaling
$685 and $323 for the six-month periods ended June 30, 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
adjustment of clinical trial and development activity wind-down
charge associated with the discontinuance of GED-0301 clinical
trials in Crohn’s disease. (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,
as well as changes in the fair value of success payments related to
the acquisition of Juno.
(8) Exclude acquisition costs related to Juno. (9)
Exclude changes in the fair value of
equity investments due to 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- and six-month periods ended
June 30, 2018 and 2017 are to exclude the excess tax related to the
adoption of ASU 2016-09 (Compensation-Stock Compensation).
Three-Month Period Ended Six-Month
Period Ended June 30, 2017 June 30, 2017 As Reported As
Revised As Reported As Revised Net income - GAAP $ 1,061 $
1,101 $ 2,002 $ 2,033 Net income - Adjusted 1,474 1,514 2,838 2,869
Diluted net income per common share - Adjusted $ 1.82 $ 1.87 $ 3.50
$ 3.54
Celgene Corporation and Subsidiaries
Reconciliation of Full-Year 2018 Projected GAAP to Adjusted Net
Income (In millions, except per share data)
Range Low High Projected net income - GAAP (1)
$ 4,374 $ 4,594 Before tax adjustments: Cost of goods sold
(excluding amortization of acquired intangible assets): Share-based
compensation expense 31 28 Research and development:
Share-based compensation expense 554 502 Collaboration-related
upfront expense 391 391 Research and development asset acquisition
expense 1,125 1,125 Adjustment to clinical trial and development
activity wind-down charge (60 ) (60 ) Selling, general and
administrative: Share-based compensation expense 542 491
Amortization of acquired intangible assets 493 469
Acquisition related charges (income) and restructuring, net: Change
in fair value of contingent consideration and success payments 24
14 Acquisition related charges 110 88 Other income
(expense), net: Change in fair value of equity investments (1,007 )
(1,007 ) Income tax provision: Estimated tax impact from
above adjustments (166 ) (188 ) Non-operating tax adjustments
(16 ) (16 ) Projected net income - Adjusted $ 6,395
$ 6,431 Projected net income per diluted
common share - GAAP $ 5.95 $ 6.25 Projected net income per
diluted common share - Adjusted $ 8.70 $ 8.75 Projected
weighted average diluted shares 735.0 735.0
(1) Our projected 2018 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 as per 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.
Celgene Corporation and Subsidiaries
Net Product Sales (In millions)
Three-Month Periods Ended June 30, %
Change 2018 2017 Reported
Operational(1)
Currency(2)
REVLIMID® U.S. $ 1,586 $ 1,358 16.8% 16.8% 0.0%
International 867 676 28.3% 29.9% (1.6)% Worldwide
2,453 2,034 20.6% 21.1% (0.5)%
POMALYST®/IMNOVID® U.S. 341 241 41.5%
41.5% 0.0% International 166 150 10.7% 11.8% (1.1)%
Worldwide 507 391 29.7% 30.1% (0.4)%
OTEZLA®
U.S. 291 306 (4.9)% (4.9)% 0.0% International 84 52
61.5% 62.5% (1.0)% Worldwide 375 358 4.7% 4.9% (0.2)%
ABRAXANE® U.S. 152 161 (5.6)% (5.6)% 0.0%
International 91 93 (2.2)% (1.0)% (1.2)% Worldwide
243 254 (4.3)% (3.9)% (0.4)%
IDHIFA® (3) U.S.
16 - N/A N/A N/A International 1 - N/A N/A N/A
Worldwide 17 - N/A N/A N/A
VIDAZA® U.S. 3 2
50.0% 50.0% 0.0% International 159 154 3.2% 5.0%
(1.8)% Worldwide 162 156 3.8% 5.6% (1.8)%
azacitidine for
injection U.S. 5 9 (44.4)% (44.4)% 0.0% International -
- N/A N/A N/A Worldwide 5 9 (44.4)% (44.4)% 0.0%
THALOMID® U.S. 17 21 (19.0)% (19.0)% 0.0%
International 11 13 (15.4)% (13.6)% (1.8)% Worldwide
28 34 (17.6)% (16.9)% (0.7)%
ISTODAX® U.S. 14
17 (17.6)% (17.6)% 0.0% International 3 2 50.0% 48.7%
1.3% Worldwide 17 19 (10.5)% (10.6)% 0.1%
All Other
U.S. - - N/A N/A N/A International 1 4 N/A N/A N/A
Worldwide 1 4 N/A N/A N/A
Total Net Product Sales
U.S. 2,425 2,115 14.7% 14.7% 0.0% International 1,383
1,144 20.9% 22.7% (1.8)% Worldwide $ 3,808 $ 3,259 16.8% 17.4%
(0.6)% (1) Operational includes impact from both
volume and price. (2) Currency includes the impact from both
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)
Six-Month Periods Ended June 30, %
Change 2018 2017 Reported
Operational(1)
Currency(2)
REVLIMID® U.S. $ 3,073 $ 2,592 18.6% 18.6% 0.0%
International 1,614 1,326 21.7% 22.1% (0.4)%
Worldwide 4,687 3,918 19.6% 19.7% (0.1)%
POMALYST®/IMNOVID® U.S. 641 457 40.3%
40.3% 0.0% International 319 298 7.0% 7.7% (0.7)%
Worldwide 960 755 27.2% 27.5% (0.3)%
OTEZLA®
U.S. 567 505 12.3% 12.3% 0.0% International 161 95
69.5% 69.8% (0.3)% Worldwide 728 600 21.3% 21.3% 0.0%
ABRAXANE® U.S. 311 303 2.6% 2.6% 0.0% International
194 187 3.7% 4.2% (0.5)% Worldwide 505 490 3.1% 3.3%
(0.2)%
IDHIFA® (3) U.S. 30 - N/A N/A N/A
International 1 - N/A N/A N/A Worldwide 31 - N/A N/A
N/A
VIDAZA® U.S. 5 4 25.0% 25.0% 0.0%
International 314 310 1.3% 2.0% (0.7)% Worldwide 319
314 1.6% 2.3% (0.7)%
azacitidine for injection U.S.
11 18 (38.9)% (38.9)% 0.0% International 1 - N/A N/A
N/A Worldwide 12 18 (33.3)% (33.3)% 0.0%
THALOMID® U.S. 36 43 (16.3)% (16.3)% 0.0%
International 23 27 (14.8)% (14.1)% (0.7)% Worldwide
59 70 (15.7)% (15.4)% (0.3)%
ISTODAX® U.S. 30
34 (11.8)% (11.8)% 0.0% International 6 5 20.0% 17.7%
2.3% Worldwide 36 39 (7.7)% (8.0)% 0.3%
All Other
U.S. - - N/A N/A N/A International 2 7 N/A N/A N/A
Worldwide 2 7 N/A N/A N/A
Total Net Product Sales
U.S. 4,704 3,956 18.9% 18.9% 0.0% International 2,635
2,255 16.9% 17.6% (0.7)% Worldwide $ 7,339 $ 6,211 18.2% 18.4%
(0.2)% (1) Operational includes impact from both
volume and price. (2) Currency includes the impact from both
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/20180726005392/en/
CelgeneInvestors:908-673-9628ir@celgene.comorMedia:908-673-2275media@celgene.com
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