Total Revenue Continues Steady Growth of 10 Percent; Progress on All Aspects of the Business
Conference Call and Webcast to Be Held Today at 5:00 p.m. ET
Financial Highlights ($ in millions, except per share data, unaudited)
| Q1 2013 | Q1 2012 | Percent Change | |
| Total BioMarin Revenue | $ 127.9 | $ 116.6 | 9.7% |
| Total Net Product Revenue | 127.3 | 116.2 | 9.6% |
| Naglayzme Net Product Revenue | 69.4 | 68.6 | 1.2% |
| Aldurazyme BioMarin Net Product Revenue | 16.7 | 12.0 | 39.2% |
| Kuvan Net Product Revenue | 37.6 | 32.0 | 17.5% |
| Firdapse Net Product Revenue | 3.6 | 3.6 | 0.0% |
| GAAP Net Loss | (39.8) | (24.0) | |
| GAAP Net Loss per Share (basic and diluted) | $ (0.31) | $ (0.21) | |
| Non-GAAP Adjusted EBITDA Loss | $ (8.0) | $ (0.1) | |
| Cash, cash equivalents and short and long-term investments | $ 525.7 | $ 287.7 | 82.7% |
SAN RAFAEL, Calif., April 25, 2013 (GLOBE NEWSWIRE) -- BioMarin Pharmaceutical Inc. (Nasdaq:BMRN) today announced financial results for its first quarter ended March 31, 2013. GAAP net loss was $39.8 million ($0.31 per share) for the first quarter of 2013, compared to GAAP net loss of $24.0 million ($0.21 per share) for the first quarter of 2012. Non-GAAP adjusted EBITDA was a loss of $8.0 million for the first quarter of 2013, compared to non-GAAP adjusted EBITDA loss of $0.1 million for the first quarter of 2012. The increased GAAP net loss and the increased non-GAAP adjusted EBITDA loss for the first quarter of 2013 compared to the first quarter of 2012 was primarily due to increased net product revenue offset by a larger increase in research and development expenses.
As of March 31, 2013, BioMarin had cash, cash equivalents and short and long-term investments totaling $525.7 million, as compared to $566.7 million on December 31, 2012.
"In the first quarter, we continued to execute on our development goals as we head into another potentially transformative year for the company," said Jean-Jacques Bienaimé, Chief Executive Officer of BioMarin. "We made good progress on a number of important fronts including commercial, R&D, regulatory and business development. Highlights included positive results for the Phase 1/2 trial for BMN-701 for Pompe disease, submission of the BLA for Vimizim in the U.S. and the MAA for Vimizim in the EU, the acquisition of Zacharon Pharmaceuticals and the licensing of the Factor VIII program for Hemophilia A. We hit all of our stated milestones for the quarter and remain on track to meet our upcoming goals for the remainder of the year."
| Three Months Ended March 31, | ||||
| 2013 | 2012 | $ Change | % Change | |
| Naglazyme (1) | $ 69.4 | 68.6 | $ 0.8 | 1.2% |
| Kuvan | 37.6 | 32.0 | 5.6 | 17.5% |
| Firdapse | 3.6 | 3.6 | 0.0 | 0.0% |
(1) Naglazyme revenues experience quarterly fluctuations due to the timing of government ordering patterns in certain countries. There were no abnormal ordering patterns in the first quarter of 2013. In the first quarter of 2012, there was a delayed order from the fourth quarter of 2011. There was a 10.2 percent increase in Naglazyme revenue in the first quarter of 2013 over the fourth quarter of 2012 and an 11.0 percent increase in patients on therapy as compared to the first quarter of 2012, which is consistent with that of previous quarters.
| Three Months Ended March 31, | ||||
| 2013 | 2012 | $ Change | % Change | |
| Aldurazyme revenue reported by Genzyme | $ 48.4 | $ 45.9 | $ 2.5 | 5.4% |
| Royalties due from Genzyme | 19.3 | 18.4 | 0.9 | |
| Incremental product transfer revenues (2) | (2.6) | (6.4) | 3.8 | |
| Total Aldurazyme net product revenues | $ 16.7 | $ 12.0 | $ 4.7 | |
(2) To the extent units shipped to third party customers by Genzyme exceed BioMarin inventory transfers to Genzyme, BioMarin will record a decrease in net product revenue from the royalty payable to BioMarin for the amount of previously recognized product transfer revenue. If BioMarin inventory transfers exceed units shipped to third party customers by Genzyme, BioMarin will record incremental net product transfer revenue for the period.
| BioMarin Reaffirms 2013 Full Year Financial Guidance | |
| Revenue Guidance ($ in millions) | |
| Item | 2013 Guidance |
| Total BioMarin Revenues | $530 to $555 |
| Naglazyme Net Product Revenue | $265 to $285 |
| Kuvan Net Product Revenue | $155 to $170 |
| Selected Income Statement Guidance ($ in millions) | |
| Item | 2013 Guidance |
| Cost of Sales (% of Total Revenue) | 17% to 18% |
| Selling, General and Admin. Expense | $220 to $250 |
| Research and Development Expense* | $340 to $380 |
| GAAP Net Loss | $(195) to $(170) |
| Non-GAAP Adjusted EBITDA (loss) | $(75) to $(50) |
| Cash Balance** | Over $420 |
* Research and Development expense guidance includes expenses associated with the Zacharon acquisition and the licensing of the Factor VIII program for Hemophilia A from the University College London and St. Jude Children's Research Hospital
** Cash balance includes cash, cash equivalents and short and long term investments
Anticipated Upcoming Milestones
| 2Q 2013: Initiation of Phase 3 trial for PEG-PAL for PKU |
| 2Q 2013: Presentation on Phase 1/2 BMN-673 solid tumor data at ASCO meeting |
| Mid 2013: Initiation of Phase 2 trial for BMN-111 for achondroplasia |
| Mid 2013: Initiation of Phase 1/2 trial for BMN-190 for Batten disease |
| 4Q 2013: Initiation of Phase 3 trial for BMN-673 |
| 4Q 2013: Potential FDA approval of Vimizim for MPS IVA |
| 4Q 2013: Initiation of Phase 2/3 switching trial for BMN-701 for Pompe disease |
Research and Development Programs
BioMarin continues to make significant investments in research and development to ensure a strong and profitable pipeline for the company. The current pipeline includes programs in various stages of development that focus on treating a range of rare and serious unmet medical needs.
Advanced Clinical Programs
- Vimizim for MPS IVA: The company submitted the BLA for Vimizim at the end of the first quarter of 2013 and the market authorization application filing in the EU earlier this week. Vimizim has received accelerated review status from the EMA.
Mid-Stage Clinical Programs
- PEG-PAL for PKU: The company plans to initiate a pivotal Phase 3 study in the second quarter of 2013. The Phase 3 design includes (1) an open-label study to evaluate safety and blood Phe levels in naïve patients and (2) a randomized controlled study of the Phase 2 extension study patients and patients from the open label trial to evaluate blood Phe levels and neurocognitive endpoints. The FDA indicated the possibility for an accelerated approval based on demonstrating sustained reduction in Phe levels, though full approval may require demonstration of neurocognitive improvement.
Early-Stage Clinical Programs
- BMN-701 for Pompe Disease: The company plans to initiate a Phase 2/3 switching trial by the end of 2013 in late-onset Pompe patients who have previously been treated with alglucosidase alfa. Subject to discussions with health authorities, the proposed study design is a single arm trial, with treatment at 20 mg/kg administered every other week for 24 weeks. The company intends to use the respiratory parameter MIP as the primary endpoint. Secondary objectives include MEP and six-minute walk test, as well as safety. The study will be conducted with full scale material from a revised manufacturing process, which has improved process robustness and increased productivity.
- BMN-673 (PARP inhibitor): An update on the Phase 1/2 study in solid tumors is expected at the ASCO Annual Meeting in June 2013.
- BMN-111 for Achondroplasia: The company plans to initiate a Phase 2 trial in patients in mid 2013. The primary objective of the clinical proof of concept study in pediatric patients will be to evaluate the safety and tolerability of daily subcutaneous (sc) injections of BMN-111 administered for six months. Secondary objectives of the study will be to assess changes in annualized growth velocity, changes in absolute growth and changes in body proportions. Other exploratory objectives will also be assessed.
- BMN-190 for LINCL (Batten disease): BioMarin filed a CTA in the first quarter of 2013 and expects to begin enrolling the study in mid 2013. Orphan drug designation has been granted in both the U.S. and EU.
Preclinical Programs
- Other early stage programs: BioMarin is working on multiple additional early development opportunities, including two new lead optimization programs gained through the acquisition of Zacharon Pharmaceuticals: inhibition of heparan sulfate synthesis for MPS III and inhibition of ganglioside synthesis for diseases such as Tay Sachs and Sandhoff. The company also has an ongoing Factor VIII gene therapy research program for Hemophilia A from University College London and St. Jude Children's Research Hospital.
Non-GAAP Financial Information and Reconciliation
The results for the three months ended March 31, 2013 and March 31, 2012 and financial guidance for the year ending December 31, 2013 are all determined in accordance with GAAP except for non-GAAP adjusted EBITDA which is determined on a non-GAAP basis. As used in this release, non-GAAP adjusted EBITDA is based on GAAP earnings before interest, taxes, depreciation and amortization (EBITDA) and further adjusted to also exclude certain non-cash stock compensation expense, non-cash contingent consideration expense and certain other nonrecurring material items (non-GAAP adjusted EBITDA).
The following table presents the reconciliation of non-GAAP to GAAP financial metrics:
| Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA Loss | ||||
| (in millions) | ||||
| (unaudited) | ||||
|
Three Months Ended March 31, |
Year Ending December 31, 2013 |
|||
| NOTES | 2013 | 2012 | Guidance | |
| GAAP Net Loss | $ (39.8) | $ (24.0) | $(195.0) - $(170.0) | |
| Interest expense, net | 1.0 | 1.4 | 0.7 | |
| Benefit from Income taxes | (4.7) | -- | (14.6) | |
| Depreciation expense | 6.1 | 7.3 | 25.0 | |
| Amortization expense | 2.6 | 9.3 | 10.5 | |
| EBITDA Loss | (34.8) | (6.0) | (173.4) - (148.4) | |
| Stock-based compensation expense | 11.6 | 11.1 | 70.0 | |
| Contingent consideration expense | (1) | 4.8 | (5.2) | 18.0 |
| Material non-recurring: | ||||
| Debt conversion expense | (2) | 10.4 | -- | 10.4 |
| Non-GAAP Adjusted EBITDA Loss | $ (8.0) | $ (0.1) | $(75.0) - $(50.0) | |
| (1) Represents the expense in the fair value of contingent acquisition consideration payable for the period. The change in the current quarter reflects changes in estimated probabilities and timing of achieving certain developmental milestones. | ||||
| (2) Represents debt conversion expense associated with the early conversion of a portion of our 2017 convertible notes in March 2013. | ||||
BioMarin believes that this non-GAAP information is useful to investors, taken in conjunction with BioMarin's GAAP information because it provides additional information regarding the performance of BioMarin's core ongoing business, Naglazyme, Kuvan, Aldurazyme and Firdapse and development of its pipeline. By providing information about both the overall GAAP financial performance and the non-GAAP measures that focus on continuing operations, the company believes that the additional information enhances investors' overall understanding of the company's business and prospects for the future. Further, the company uses both the GAAP and the non-GAAP results and expectations internally for its operating, budgeting and financial planning purposes.
Conference Call Details
BioMarin will host a conference call and webcast to discuss first quarter 2013 financial results today, Thursday, April 25, 2013 at 5:00 p.m. ET. This event can be accessed on the investor section of the BioMarin website at www.BMRN.com.
| Date: April 25, 2013 |
| Time: 5:00 p.m. ET |
| U.S. / Canada Dial-in Number: 877.303.6313 |
| International Dial-in Number: 631.813.4734 |
| Conference ID: 29712683 |
| Replay Dial-in Number: 855.859.2056 |
| Replay International Dial-in Number: 404.537.3406 |
| Conference ID: 29712683 |
About BioMarin
BioMarin develops and commercializes innovative biopharmaceuticals for serious diseases and medical conditions. The company's product portfolio comprises four approved products and multiple clinical and pre-clinical product candidates. Approved products include Naglazyme® (galsulfase) for mucopolysaccharidosis VI (MPS VI), a product wholly developed and commercialized by BioMarin; Aldurazyme® (laronidase) for mucopolysaccharidosis I (MPS I), a product which BioMarin developed through a 50/50 joint venture with Genzyme Corporation; Kuvan® (sapropterin dihydrochloride) Tablets, for phenylketonuria (PKU), developed in partnership with Merck Serono, a division of Merck KGaA of Darmstadt, Germany; and Firdapse® (amifampridine), which has been approved by the European Commission for the treatment of Lambert Eaton Myasthenic Syndrome (LEMS). Product candidates include Vimizim (N-acetylgalactosamine 6-sulfatase), formally referred to as GALNS, which successfully completed Phase III clinical development for the treatment of MPS IVA, PEG-PAL (PEGylated recombinant phenylalanine ammonia lyase), which is currently in Phase II clinical development for the treatment of PKU, BMN-701, a novel fusion protein of insulin-like growth factor 2 and acid alpha glucosidase (IGF2-GAA), which is currently in Phase I/II clinical development for the treatment of Pompe disease, BMN-673, a poly ADP-ribose polymerase (PARP) inhibitor, which is currently in Phase I/II clinical development for the treatment of genetically-defined cancers, and BMN-111, a modified C-natriuretic peptide, which is currently in Phase I clinical development for the treatment of achondroplasia. For additional information, please visit www.BMRN.com. Information on BioMarin's website is not incorporated by reference into this press release.
Forward-Looking Statement
This press release contains forward-looking statements about the business prospects of BioMarin Pharmaceutical Inc., including, without limitation, statements about: the expectations of revenue and sales related to Naglazyme, Kuvan, Firdapse, and Aldurazyme; the financial performance of the BioMarin as a whole; our expectations regarding the progress and timing of BioMarin's clinical trials of PEG-PAL, BMN-673, BMN-701, BMN-111 and other product candidates; the continued clinical development and commercialization of Aldurazyme, Naglazyme, Kuvan, Firdapse, and its product candidates; our expectations regarding the timing of our regulatory filings for our product candidates; and actions by regulatory authorities. These forward-looking statements are predictions and involve risks and uncertainties such that actual results may differ materially from these statements. These risks and uncertainties include, among others: our success in the continued commercialization of Naglazyme, Kuvan, and Firdapse; Genzyme Corporation's success in continuing the commercialization of Aldurazyme; results and timing of current and planned preclinical studies and clinical trials, particularly with respect to PEG-PAL, BMN-673, BMN-701 and BMN-111; our ability to successfully manufacture our products and product candidates; the content and timing of decisions by the U.S. Food and Drug Administration, the European Commission and other regulatory authorities concerning each of the described products and product candidates; the market for each of these products and particularly Aldurazyme, Naglazyme, Kuvan and Firdapse; actual sales of Aldurazyme, Naglazyme Kuvan and Firdapse; Merck Serono's activities related to Kuvan; and those risks that are discussed in BioMarin's filings with the Securities and Exchange Commission, including, without limitation, BioMarin's 2012 Annual Report on Form 10-K, and our periodic reports on Form 10-Q and Form 8-K. Stockholders are urged not to place undue reliance on forward-looking statements, which speak only as of the date hereof. BioMarin is under no obligation, and expressly disclaims any obligation to update or alter any forward-looking statement, whether as a result of new information, future events or otherwise.
Vimizim™ is our trademark, and BioMarin®, Naglazyme®, Kuvan®, Firdapse® are registered trademarks of BioMarin Pharmaceutical Inc.
Aldurazyme® is a registered trademark of BioMarin/Genzyme LLC.
| BIOMARIN PHARMACEUTICAL INC. | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| March 31, 2013 and December 31, 2012 | ||
| (In thousands of U.S. dollars, except share and per share amounts) | ||
| March 31, 2013 | December 31, 2012(1) | |
| ASSETS | (unaudited) | |
| Current assets: | ||
| Cash and cash equivalents | $ 154,380 | $ 180,527 |
| Short-term investments | 247,502 | 270,211 |
| Accounts receivable, net (allowance for doubtful accounts: $376 and $348, respectively) | 120,345 | 109,066 |
| Inventory | 135,822 | 128,695 |
| Current deferred tax assets | 29,474 | 29,454 |
| Other current assets | 35,501 | 25,509 |
| Total current assets | 723,024 | 743,462 |
| Noncurrent assets: | ||
| Investment in BioMarin/Genzyme LLC | 679 | 1,080 |
| Long-term investments | 123,819 | 115,993 |
| Property, plant and equipment, net | 281,865 | 284,473 |
| Intangible assets, net | 172,016 | 162,980 |
| Goodwill | 54,975 | 51,543 |
| Long-term deferred tax assets | 226,757 | 225,501 |
| Other assets | 15,158 | 16,611 |
| Total assets | $ 1,598,293 | $ 1,601,643 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Accounts payable and accrued liabilities | $ 144,008 | $ 147,068 |
| Convertible debt | -- | 23,365 |
| Total current liabilities | 144,008 | 170,433 |
| Noncurrent liabilities: | ||
| Long-term convertible debt | 109,849 | 324,859 |
| Long-term contingent acquisition consideration payable | 27,224 | 30,618 |
| Long-term deferred tax liabilities | 37,521 | 33,296 |
| Other long-term liabilities | 29,539 | 26,674 |
| Total liabilities | 348,141 | 585,880 |
| Stockholders' equity: | ||
| Common stock, $0.001 par value: 250,000,000 shares authorized at March 31, 2013 and December 31, 2012; 138,873,207 and 125,809,162 shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively. | 139 | 126 |
| Additional paid-in capital | 1,833,831 | 1,561,890 |
| Company common stock held by Nonqualified Deferred Compensation Plan | (5,715) | (6,603) |
| Accumulated other comprehensive income (loss) | 1,155 | (202) |
| Accumulated deficit | (579,258) | (539,448) |
| Total stockholders' equity | 1,250,152 | 1,015,763 |
| Total liabilities and stockholders' equity | $ 1,598,293 | $ 1,601,643 |
(1) December 31, 2012 balances were derived from the audited consolidated financial statements.
| BIOMARIN PHARMACEUTICAL INC. | ||
| CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||
| Three Months Ended March 31, 2013 and 2012 | ||
| (In thousands of U.S. dollars, except per share amounts) | ||
| (Unaudited) | ||
| 2013 | 2012 | |
| REVENUES: | ||
| Net product revenues | $ 127,344 | $ 116,239 |
| Collaborative agreement revenues | 135 | 96 |
| Royalty and license revenues | 449 | 314 |
| Total revenues | 127,928 | 116,649 |
| OPERATING EXPENSES: | ||
| Cost of sales (excludes amortization of certain acquired intangible assets) | 20,500 | 17,105 |
| Research and development | 83,743 | 73,834 |
| Selling, general and administrative | 51,050 | 45,248 |
| Intangible asset amortization and contingent consideration | 5,556 | 2,328 |
| Total operating expenses | 160,849 | 138,515 |
| LOSS FROM OPERATIONS | (32,921) | (21,866) |
| Equity in the loss of BioMarin/Genzyme LLC | (401) | (734) |
| Interest income | 718 | 505 |
| Interest expense | (1,725) | (1,947) |
| Debt conversion expense | (10,420) | -- |
| Other income | 228 | 36 |
| LOSS BEFORE INCOME TAXES | (44,521) | (24,006) |
| Provision for income taxes | (4,711) | (34) |
| NET LOSS | $ (39,810) | $ (23,972) |
| NET LOSS PER SHARE, BASIC AND DILUTED | $ (0.31) | $ (0.21) |
| Weighted average common shares outstanding, basic and diluted | 127,969 | 115,070 |
| COMPREHENSIVE LOSS | $ (38,452) | $ (26,347) |
| STOCK-BASED COMPENSATION EXPENSE | ||
| Total stock-based compensation expense included in the Condensed Consolidated Statements of Comprehensive Loss is as follows: | ||
| Three Months Ended | ||
| March 31, | ||
| 2013 | 2012 | |
| (unaudited) | (unaudited) | |
| Cost of sales | $ 1,044 | $ 873 |
| Research and development | 5,324 | 4,695 |
| Selling, general and administrative | 5,197 | 5,566 |
| $ 11,565 | $ 11,134 | |