2002 Highlights
-
Worldwide Synagis(R) (palivizumab) sales up 29 percent to $668 million
-
Ethyol(R) (amifostine) sales exceeded $80 million
-
FluMist(TM) receives favorable recommendation from FDA Advisory Panel
-
Positive Phase 3 data for Synagis(R) in congenital heart disease
infants submitted to FDA
-
MedImmune Vaccines, Inc. created through $1.6 billion acquisition of
Aviron
-
Three new preclinical programs in-licensed
-
Synagis approved and launched in Japan and Canada
-
Construction of new headquarters and FluMist manufacturing facilities
initiated
-
MedImmune Ventures, Inc. established
GAITHERSBURG, Md., Jan. 30 /PRNewswire-FirstCall/ -- MedImmune, Inc.
(Nasdaq: MEDI) today announced that total revenue for the fourth quarter of
2002 increased 30 percent to $382 million, driving revenue to $848 million for
the full year ended December 31, 2002. Revenue growth was due primarily to
the continued success of Synagis, the company's flagship product used to
prevent respiratory syncytial virus (RSV) in high-risk infants. Worldwide
sales of Synagis in 2002 were $668 million, a 29-percent increase over 2001
sales of $516 million. For the 2002 fourth quarter, worldwide sales of
Synagis increased 25 percent to $312 million from $250 million in the 2001
period. Sales of Ethyol, the company's first oncology product, exceeded $80
million during 2002 and $25 million in the 2002 fourth quarter. In 2001,
MedImmune recorded Ethyol revenues of $20 million and $14 million for the year
and fourth quarter, respectively. Other revenue in the fourth quarter of 2002
included $25 million related to compensation for 2002 FluMist manufacturing
costs from Wyeth, the company's co-promotion partner for the product.
"We made substantial progress in 2002 toward our long-term goals," stated
David M. Mott, chief executive officer. "Product sales increased 36 percent;
we completed the acquisition and integration of a vaccine company that
provides us with our next potential blockbuster product, FluMist; we completed
a successful Phase 3 trial with Synagis in children with congenital heart
disease; we added three new programs to our preclinical pipeline; and we broke
ground on a number of construction projects, including our new headquarters
and research and development facility, as well as a new production facility
for FluMist."
Mr. Mott added, "In 2003, we look forward to launching FluMist, moving
into Phase 3 with our human papillomavirus vaccine for the prevention of
cervical cancer, and taking two programs from our preclinical pipeline forward
into clinical trials. We expect to achieve a major financial milestone for
MedImmune in 2003 with revenues exceeding $1 billion for the first time,
reflecting revenue growth of 24 percent to 30 percent. We also expect our
earnings to more than double in 2003."
For the fourth quarter 2002, MedImmune reported net earnings of $85
million, or $0.33 per diluted share. For the year ended December 31, 2002,
MedImmune reported a loss of $1.1 billion or $4.40 per share. This loss
reflects the impact of a $1.2 billion in-process research and development
charge associated with the purchase of MedImmune Vaccines (formerly known as
Aviron), as well as the inclusion of MedImmune Vaccines' operations in
MedImmune's results as of January 10, 2002. In 2001, MedImmune reported net
earnings of $99 million, or $0.45 per diluted share, for the fourth quarter,
and $149 million, or $0.68 per diluted share for the year.
Adjusted Results
MedImmune also announced "adjusted" results for 2002, which exclude
certain amounts associated with the acquisition of MedImmune Vaccines.
MedImmune computes "adjusted" earnings by adding back amounts that are related
to the acquisition of MedImmune Vaccines, including: the in-process research
and development charge; amortization of intangible assets; compensation
expense associated with the assumption and vesting of unvested stock options,
retention and severance payments; and amortization of premium on convertible
subordinated notes. MedImmune believes the "adjusted" results are more
indicative of the underlying trends in the operations of the business, and
will continue to provide "adjusted" results in addition to reporting earnings
computed in accordance with generally accepted accounting principles (GAAP).
The accompanying schedules present the reconciliation from GAAP results to
"adjusted" results, with additional details included in the notes to those
schedules.
Fourth Quarter Adjusted Earnings
For the 2002 fourth quarter, MedImmune's adjusted net earnings were $92
million, or $0.36 per diluted share.
Gross margins on product sales for the 2002 fourth quarter were 76 percent
versus 77 percent in the 2001 fourth quarter, reflecting the cost of
additional royalty payments related to domestic Synagis sales in 2002,
partially offset by manufacturing cost reductions for Synagis.
Research and development expenses rose to $30 million in the 2002 fourth
quarter from $21 million last year. The increases were due largely to the
inclusion of MedImmune Vaccines' activities and gaining access to various
technologies and intellectual property to advance our pipeline.
Selling, general and administrative costs in the fourth quarter of 2002
increased to $102 million from $67 million in the 2001 period, due primarily
to increased co-promotion expenses for Synagis, the acquisition of MedImmune
Vaccines, and higher marketing expenses for Synagis and Ethyol.
Other operating expenses in the fourth quarter of 2002 were $26 million
compared to $2 million in the fourth quarter last year. In addition to pre-
production expenses for FluMist, other operating expenses included a $13
million charge for the write-off of plasma manufacturing assets due to the
outsourcing of CytoGam manufacturing activities.
The number of shares used in computing basic and diluted earnings per
share increased by approximately 34 million primarily due to shares issued for
the acquisition of MedImmune Vaccines.
Adjusted Earnings for the Year 2002
MedImmune's adjusted earnings for 2002 were $107 million, or $0.42 per
diluted share.
Gross margins on product sales for 2002 were 74 percent, down two
percentage points from the comparable period last year, largely due to the
additional royalty payments in 2002 related to domestic Synagis sales.
Research and development expenses rose to $135 million in 2002 from $83
million in the 2001 year, largely due to the inclusion of MedImmune Vaccines'
activities, gaining access to various technologies and intellectual property
to advance our pipeline, and the progress of the research pipeline over the
course of 2002.
Selling, general and administrative costs in 2002 increased to $287
million from $195 million in the 2001 period due primarily to: the acquisition
of MedImmune Vaccines; increased co-promotion expenses for Synagis; higher
sales and marketing expenses for Synagis and Ethyol; increases in
infrastructure costs to support the growth of the business; and costs
associated with the settlement of a contractual dispute.
Other operating expenses in 2002 were $79 million compared to $10 million
in the 2001 period, primarily due to costs associated with the manufacture of
FluMist and the fixed asset write-off associated with the outsourcing of
CytoGam manufacturing activities during the fourth quarter.
Results for the year also reflect approximately $14 million in impairment
losses on certain equity investments that were affected by the downward
movement in the capital markets during 2002.
The number of shares used in computing basic and diluted earnings per
share increased by approximately 33 million primarily due to shares issued for
the acquisition of MedImmune Vaccines.
Cash and marketable securities at December 31, 2002 were $1.4 billion
compared to $778 million at December 31, 2001, primarily reflecting cash and
securities received as a part of the acquisition of MedImmune Vaccines and
positive cash flow from operations.
Looking Ahead in 2003
The following forward-looking information is being provided as a
convenience to investors. The guidance and objectives provided below are
projections and assume the continued growth and success of MedImmune's
existing business, including sales of Synagis and Ethyol, as well as the
approval of FluMist by the FDA in the second quarter of 2003 and the
subsequent initiation of sales of FluMist in the U.S. in the second half of
2003 and progress on MedImmune's pipeline. Investors should note that sales
of Synagis occur primarily during the fourth and first calendar quarters when
RSV is most prevalent in the Northern Hemisphere, and that sales of FluMist
are expected to primarily occur in the second half of the year, which is the
most common time for yearly influenza vaccinations. The company's quarterly
results are expected to reflect this seasonality for its marketed products.
The projections provided here are provided on an "adjusted" basis, except
where specifically identified as GAAP. Further, the projections are based
upon numerous assumptions, many of which MedImmune cannot control and which
may not develop as MedImmune expects. Consequently, actual results may differ
materially from the guidance and objectives described herein. Please refer to
the Disclosure Notice below.
Guidance for the year ending December 31, 2003
* Adjusted earnings per diluted share: $0.88 to $0.93 (110% to 121%
growth over 2002)
* GAAP earnings per diluted share: $0.84 to $0.89
* Total revenue of $1.05 to $1.1 billion (24% to 30% growth over 2002)
* Projected product sales growth: 21% to 25% over 2002
* Projected growth of Synagis: 16% to 20% over 2002
* Projected growth of Ethyol: 20% to 25% over 2002
* Total FluMist revenue (product sales and other revenue from
milestones and royalties): $120 million to $140 million
* Gross margins: approximately 71% of product sales
* Research and development expense: projected to range from $140 million
to $145 million
* Selling, general and administrative: projected to be 32% to 33% of
product sales
* Other expenses: projected to range from $17 million to $20 million
* Tax rate: approximately 37%
Guidance for the quarter ending March 31, 2003
-
Adjusted earnings per diluted share: $0.40 to $0.43 (38% to 48% growth
over 2002)
-
GAAP earnings per diluted share: $0.38 to $0.41
-
Total revenue: $410 million to $425 million (24% to 29% growth
over 2002)
Conference Call & Webcast
MedImmune is offering a live webcast of a discussion by MedImmune
management of its earnings and other business results on Thursday, January 30,
2003 at 8:00 a.m. ET. The live webcast may be accessed on MedImmune's website
at http://www.medimmune.com . A replay of the webcast will also be available
via our website until February 6, 2003. An audio replay of the webcast will
be available beginning at 11:00 a.m. ET on January 30, 2003 until midnight
February 6, 2003 by calling 888-286-8010. The pass code for the audio replay
is 71815.
About MedImmune
MedImmune is a leading biotechnology company focused on researching,
developing and commercializing products to prevent or treat infectious
disease, autoimmune disease and cancer. MedImmune actively markets three
products, Synagis(R) (palivizumab), Ethyol(R) (amifostine) and CytoGam(R)
(cytomegalovirus immune globulin intravenous (human)), and has additional
products in clinical testing. MedImmune employs approximately 1,600 people,
is headquartered in Gaithersburg, Maryland, and has additional operations in
Frederick, Maryland, as well as Pennsylvania, California, the United Kingdom
and the Netherlands. For more information on MedImmune, visit the company's
website at http://www.medimmune.com .
Synagis(R) is marketed for the prevention of serious lower respiratory
tract disease caused by respiratory syncytial virus in pediatric patients at
high risk of RSV disease, which is prominent in the Northern Hemisphere from
October through May (see full prescribing information at
http://www.medimmune.com ). Ethyol(R) is marketed for the reduction of both
cumulative renal toxicity associated with repeated administration of cisplatin
in patients with advanced ovarian cancer or non-small cell lung cancer
("NSCLC") and moderate to severe xerostomia in patients undergoing post-
operative radiation treatment for head and neck cancer, where the radiation
port includes a substantial portion of the parotid (see full prescribing
information at http://www.medimmune.com ). CytoGam(R) is marketed for the
prophylaxis against cytomegalovirus disease associated with transplantation of
kidney, lung, liver, pancreas, and heart (see full prescribing information at
http://www.medimmune.com ). FluMist(TM) is MedImmune's investigational live
attenuated intranasal influenza vaccine currently under review by the U.S.
Food and Drug Administration.
DISCLOSURE NOTICE: The information contained in this document is as of
January 30, 2003, and will not be updated as a result of new information or
future events. This document contains forward-looking statements regarding
MedImmune's future financial performance and business prospects. Those
statements involve substantial risks and uncertainties. You can identify
those statements by the fact that they contain words such as "anticipate,"
"believe," "estimate," "expect," "intend," "project" or other terms of similar
meaning. Those statements reflect management's current beliefs and are based
on numerous assumptions, which MedImmune cannot control and which may not
develop as MedImmune expects. Consequently, actual results may differ
materially from those projected in the forward-looking statements. Among the
factors that could cause actual results to differ materially are: seasonal
demand for and continued supply of our principal product, Synagis; whether
FluMist receives clearance by the Food and Drug Administration and, if it
does, whether it will be successfully launched at a favorable price;
availability of competitive products in the market; availability of third-
party reimbursement for the cost of our products; effectiveness and safety of
our products; exposure to product liability, intellectual property or other
types of litigation; foreign currency exchange rate fluctuations; changes in
generally accepted accounting principles; growth in costs and expenses; the
impact of acquisitions, divestitures and other unusual items; and the risks,
uncertainties and other matters discussed in MedImmune's Annual Report on Form
10-K for the year ended December 31, 2001 and in its periodic reports on Forms
10-Q and 8-K filed with the U.S. Securities and Exchange Commission.
MedImmune cautions that RSV disease occurs primarily during the winter months;
MedImmune believes its operating results will reflect that seasonality for the
foreseeable future. MedImmune is also developing several products (including
FluMist) for potential future marketing. There can be no assurance that such
development efforts will succeed, that such products will receive required
regulatory clearance or that, even if such regulatory clearance were received,
such products would ultimately achieve commercial success.
MedImmune, Inc.
Condensed Consolidated Statements of Operations(1)
(in thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
2002 2001 2002 2001
Revenues: (Unaudited)
Product sales $348,730 $276,021 $785,961 $579,529
Other revenue 33,020 16,682 61,778 39,150
381,750 292,703 847,739 618,679
Costs and expenses:
Cost of sales 83,112 62,437 200,927 138,707
Research and
development 33,714 21,369 144,150 82,985
Selling, general
and administrative 105,132 66,671 299,323 194,841
Other operating
expenses 31,918 1,937 100,029 9,606
Acquired in-process
research and
development - - 1,179,321 -
253,876 152,414 1,923,750 426,139
Interest income, net 10,028 7,955 40,245 35,926
Loss on investment
activities (3,408) - (14,074) -
Earnings (loss) before
income taxes 134,494 148,244 (1,049,840) 228,466
Provision for income
taxes 49,903 49,738 48,175 79,506
Net earnings (loss) $84,591 $98,506 $(1,098,015) $148,960
Basic earnings (loss)
per share $0.34 $0.46 $(4.40) $0.70
Shares used in
computing basic
earnings (loss) per
share 251,078 214,273 249,625 213,378
Diluted earnings
(loss) per share $ 0.33 $0.45 $(4.40) $0.68
Shares used in
computing diluted
earnings (loss)
per share 255,297 220,582 249,625 220,101
| Note: |
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(1) As of January 10, 2002, the company has included the results of |
| |
operations for MedImmune Vaccines, Inc., formerly Aviron, which was |
| |
acquired through an exchange offer and merger transaction valued at |
| |
$1.6 billion. |
MedImmune, Inc.
Adjusted Consolidated Statements of Operations (Unaudited)
(in thousands, except per share data)
Three Months
Ended
Three Months Ended December 31, 2002 December 31,
Acquisition-related 2001
Historical(1) Adjustments(2) Adjusted Historical
Revenues:
Product sales $348,730 $- $348,730 $276,021
Other revenue 33,020 - 33,020 16,682
381,750 - 381,750 292,703
Costs and expenses:
Cost of sales 83,112 - 83,112 62,437
Research and
development 33,714 (3,730)(3) 29,984 21,369
Selling, general
and
administrative 105,132 (3,225)(4) 101,907 66,671
Other operating
expenses 31,918 (6,366)(5) 25,552 1,937
253,876 (13,321) 240,555 152,414
Interest income,
net 10,028 (466)(6) 9,562 7,955
Loss on investment
activities (3,408) - (3,408) -
Earnings before
income taxes 134,494 12,855 147,349 148,244
Provision for
income taxes 49,903 5,296 55,199 49,738
Net earnings $84,591 $7,559 $92,150 $98,506
Basic earnings
per share $0.34 $0.03 $0.37 $0.46
Shares used in
computing basic
earnings per
share 251,078 251,078 214,273
Diluted earnings
per share $0.33 $0.03 $0.36 $0.45
Shares used in
computing diluted
earnings per
share 255,297 255,297 220,582
Notes:
(1) Historical results were prepared in accordance with accounting
principles generally accepted in the United States of America and
include the results of operations for MedImmune Vaccines, Inc., as of
January 10, 2002.
(2) Acquisition-related adjustments are the amounts listed in notes (3)
through (6) that are related to the company's acquisition of MedImmune
Vaccines, Inc.
(3) Consists of $0.7 million, principally for stock compensation expense
for unvested stock options assumed in conjunction with the merger
transaction; $1.7 million for retention payments; and $1.3 million for
stock compensation expense for acceleration of stock options in
connection with a retention plan.
(4) Consists of $2.5 million, principally for amortization of intangible
assets and stock compensation expense for unvested stock options
assumed in conjunction with the merger transaction; $0.5 million for
retention payments; and $0.2 million for stock compensation expense
for acceleration of stock options in connection with a retention plan.
(5) Consists of $2.8 million, principally for amortization of intangible
assets and stock compensation expense for unvested stock options
assumed in conjunction with the merger transaction; $2.2 million for
retention payments; and $1.3 million for stock compensation expense
for acceleration of stock options in connection with a retention plan.
(6) Consists of $0.5 million, relating to the amortization of premium on
MedImmune Vaccines' Convertible Subordinated Notes.
MedImmune, Inc.
Adjusted Consolidated Statements of Operations (Unaudited)
(in thousands, except per share data)
Year Ended
Year Ended December 31, 2002 December 31,
Acquisition-related 2001
Historical(1) Adjustments(2) Adjusted Historical
Revenues:
Product sales $785,961 $- $785,961 $579,529
Other revenue 61,778 - 61,778 39,150
847,739 - 847,739 618,679
Costs and expenses:
Cost of sales 200,927 - 200,927 138,707
Research and
development 144,150 (9,386)(3) 134,764 82,985
Selling, general
and
administrative 299,323 (11,857)(4) 287,466 194,841
Other operating
expenses 100,029 (20,815)(5) 79,214 9,606
Acquired in-
process research
and
development 1,179,321 (1,179,321)(7) - -
1,923,750 (1,221,379) 702,371 426,139
Interest income,
net 40,245 (1,818)(6) 38,427 35,926
Loss on investment
activities (14,074) - (14,074) -
(Loss) earnings
before income
taxes (1,049,840) 1,219,561 169,721 228,466
Provision for
income taxes 48,175 14,972 63,147 79,506
Net (loss)
earnings $(1,098,015) $1,204,589 $106,574 $148,960
Basic (loss)
earnings per
share $(4.40) $4.83 $0.43 $0.70
Shares used in
computing basic
(loss) earnings
per share 249,625 249,625 213,378
Diluted (loss)
earnings per
share $(4.40) $4.82 $0.42 $0.68
Shares used in
computing diluted
(loss) earnings
per share 249,625 252,653 220,101
Notes:
(1) Historical results were prepared in accordance with accounting
principles generally accepted in the United States of America and
include the results of operations for MedImmune Vaccines, Inc. as of
January 10, 2002.
(2) Acquisition-related adjustments are the amounts listed in notes (3)
through (7) that are related to the company's acquisition of MedImmune
Vaccines, Inc.
(3) Consists of $4.6 million, principally for stock compensation expense
for unvested stock options assumed in conjunction with the merger
transaction; $1.7 million for retention payments; $1.3 million for
stock compensation expense for acceleration of stock options in
connection with a retention plan; and $1.8 million relating to
retention payments and stock compensation expense for acceleration of
stock options for certain executives of the acquired entity.
(4) Consists of $11.1 million, principally for amortization of intangible
assets and stock compensation expense for unvested stock options
assumed in conjunction with the merger transaction; $0.5 million for
retention payments; and $0.2 million for stock compensation expense
for acceleration of stock options in connection with a retention plan.
(5) Consists of $13.2 million, principally for amortization of intangible
assets and stock compensation expense for unvested stock options
assumed in conjunction with the merger transaction; $2.2 million for
retention payments; $1.3 million for stock compensation expense for
acceleration of stock options in connection with a retention plan; and
$4.0 million relating to retention payments and stock compensation
expense for acceleration of stock options for certain executives of
the acquired entity.
(6) Consists of $1.8 million relating to the amortization of premium on
MedImmune Vaccines' Convertible Subordinated Notes.
(7) Represents the fair value of purchased in-process technology of $1.2
billion, primarily related to MedImmune Vaccines' lead product
candidate, FluMist, which has not been approved by the FDA.
MedImmune, Inc.
Condensed Consolidated Balance Sheets(1)
(in thousands)
December 31, December 31,
2002 2001
Assets:
Cash and marketable securities $1,423,056 $777,690
Trade and contract receivables, net 124,172 127,960
Inventory, net 59,963 52,691
Deferred taxes, net 247,773 163,641
Property and equipment, net 183,992 95,402
Goodwill and intangible assets, net 129,245 -
Other assets 20,088 19,471
$2,188,289 $1,236,855
Liabilities and shareholders' equity:
Accounts payable $19,773 $5,873
Accrued expenses 231,407 160,154
Other liabilities 37,669 17,011
Long term debt 222,206 9,544
Shareholders' equity 1,677,234 1,044,273
$2,188,289 $1,236,855
Common shares outstanding 251,262 214,484
| Note: |
| |
(1) Certain prior year amounts have been reclassified to conform to the |
| |
current presentation. |
SOURCE MedImmune, Inc.
-0- 01/30/2003
/CONTACT: Investors: William Roberts, Manager, Investor Relations,
+1-301-527-4358, or Media: Jamie Lacey, Associate Director, Public Relations,
+1-240-632-4035, both of MedImmune, Inc./