EX-99.1 2 a08-19789_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

PRESS RELEASE

 

 

 

Contact:

Robyn Brown

 

Vice President, Investor Relations

 

The Medicines Company

 

973-656-1616

 

investor.relations@themedco.com

 

FOR IMMEDIATE RELEASE:

 

THE MEDICINES COMPANY REPORTS SECOND QUARTER AND FIRST HALF 2008 FINANCIAL
RESULTS AND RAISES FULL YEAR TOP LINE GUIDANCE

 

PARSIPPANY, NJ – July 23, 2008 – The Medicines Company (NASDAQ: MDCO) today announced its financial results for the second quarter and first half of 2008.

 

Financial highlights for the second quarter of 2008:

 

·                  Net revenue increased by 54% to $86.7 million for the second quarter of 2008 from $56.4 million for the second quarter of 2007.

 

·                  Angiomax® (bivalirudin) U.S. sales increased by 53% to $84.5 million for the second quarter of 2008 from $55.2 million for the second quarter of 2007.

 

·                  Angiomax/Angiox international net revenue in the second quarter of 2008 increased $1.0 million to $2.2 million compared to $1.2 million in the second quarter of 2007.

 

·                  Net income for the second quarter of 2008 was $4.1 million, or $0.08 per share, compared to net income of $0.8 million, or $0.02 per share, for the second quarter of 2007.

 

·                  Excluding stock-based compensation expense and non-cash income taxes, the Company reported second quarter of 2008 non-GAAP net income of $14.5 million, or $0.28 per share, compared to non-GAAP net income of $5.1 million, or $0.10 per share, for the second quarter of 2007.

 

John Kelley, President and Chief Operating Officer, stated, “We continue to execute our Angiomax strategy to gain market share and further penetrate the PCI market.  We look forward to hearing from the FDA on our Cleviprex submission and continue to build our European infrastructure which will lead to multiple revenue sources in the near

 

The Medicines Company   8 Campus Drive   Parsippany, New Jersey 07054   Tel: (973)656-1616   Fax: (973)656-9898

 


 

future.”

 

Financial highlights for the first half of 2008:

 

·                  Net revenue increased by 35% to $166.2 million for the first half of 2008 from $123.0 million for the same period in 2007.

 

·                  Angiomax U.S. sales increased by 33% to $161.4 million for the first half of 2008 from $121.5 million for the first half of 2007.

 

·                  Angiomax/Angiox international net revenue in the first half of 2008 increased $3.3 million to $4.8 million compared to $1.5 million in the first half of 2007.

 

·                  Net income for the first half of 2008 was $8.9 million, or $0.17 per share, compared to net income of $3.9 million, or $0.07 per share, for the first half of 2007.

 

·                  Excluding stock-based compensation expense and non-cash income taxes, the Company reported first half of 2008 non-GAAP net income of $26.9 million, or $0.51 per share, compared to non-GAAP net income of $13.3 million, or $0.25 per share, for the first half of 2007.

 

The following table provides reconciliations between GAAP and non-GAAP net income for the second quarter (Q2) and first half (1H) of 2008 and 2007.  Non-GAAP net income excludes stock-based compensation expense and the non-cash provision for income taxes:

 

(in millions)

 

Reported
GAAP Net
Income

 

FAS 123R Stock-Based
Compensation
Expense

 

Non-Cash
Provision for
Income Taxes

 

Non-GAAP
Net Income (1)

 

Q2 2008

 

$

4.1

 

$

6.9

 

$

3.6

 

$

14.5

 

Q2 2007

 

$

0.8

 

$

3.7

 

$

0.6

 

$

5.1

 

1H 2008

 

$

8.9

 

$

11.4

 

$

6.6

 

$

26.9

 

1H 2007

 

$

3.9

 

$

7.2

 

$

2.2

 

$

13.3

 

 

Note: Amounts may not sum due to rounding.

(1) Excluding stock-based compensation expense and the non-cash provision for income taxes

 

2


 

Reconciliations between GAAP and non-GAAP fully diluted earnings per share (EPS) for the second quarter (Q2) and first half (1H) of 2008 and 2007 are provided in the following table:

 

(per share)

 

Reported
GAAP EPS

 

FAS 123R Stock-Based
Compensation
Expense

 

Non-Cash
Provision for
Income Taxes

 

Non-GAAP
EPS(1)

 

Q2 2008

 

$

0.08

 

$

0.13

 

$

0.07

 

$

0.28

 

Q2 2007

 

$

0.02

 

$

0.07

 

$

0.01

 

$

0.10

 

1H 2008

 

$

0.17

 

$

0.22

 

$

0.13

 

$

0.51

 

1H 2007

 

$

0.07

 

$

0.14

 

$

0.04

 

$

0.25

 

 

Note: Amounts may not sum due to rounding.

(1) Excluding stock-based compensation expense and the non-cash provision for income taxes

 

The Company believes that presenting the non-GAAP information contained in the financial tables and in this press release assists investors and others in gaining a better understanding of the Company’s core operating results and future prospects, expected growth rates or forecasted guidance, particularly as related to stock-based compensation expense and the non-cash provision for income taxes.  Management uses this non-GAAP information, in addition to the GAAP information, as the basis for measuring the Company’s core operating performance and comparing such performance to that of prior periods and to the performance of its competitors. Such measures are also used by management in its financial and operating decision-making. Non-GAAP information is not meant to be considered superior to or a substitute for the Company’s results of operations prepared in accordance with GAAP. A reconciliation of GAAP results with non-GAAP results may also be found in the attached financial tables.

 

Revised 2008 Guidance

 

Based upon results of the first half of 2008, the Company provided revised 2008 guidance as follows:

 

·                  Full year net revenue of $335 million to $355 million, including:

·                  US net revenue for Angiomax of $320 million to $330 million

 

·                  SG&A expense of $153 million to $159 million (GAAP)

·                  $135 million to $140 million excluding stock-based compensation expense

 

·                  Total stock-based compensation expense of $22 million to $24 million

 

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The Company reaffirmed 2008 guidance on other line items as follows:

 

(in millions, except percentages and per share amounts)

 

Original

 

Revised

 

Net Sales

 

 

 

 

 

US Angiomax

 

$310-$320

 

$320-$330

 

International Angiox

 

$10-$15

 

 

 

US Cleviprex

 

$5-$10

 

 

 

Total

 

$325-$345

 

$335-$355

 

 

 

 

 

 

 

Cost of revenue

 

25%

 

 

 

 

 

 

 

 

 

R&D (GAAP)

 

$79-$83

 

 

 

(w/o 123R)

 

$75-$79

 

 

 

 

 

 

 

 

 

SG&A (GAAP)

 

$146-$153

 

$153-$159

 

(w/o 123R)

 

$130-$135

 

$135-$140

 

 

 

 

 

 

 

Stock Based Comp -123R (1)

 

$20-$22

 

$22-$24

 

 

 

 

 

 

 

Investment Income

 

$6-$8

 

 

 

 

 

 

 

 

 

Effective Tax Rate

 

50%-55%

 

 

 

 

 

 

 

 

 

Net Income - GAAP

 

$12-$16

 

 

 

- Non GAAP

 

$41-$49

 

 

 

 

 

 

 

 

 

EPS - GAAP

 

$0.22-$0.30

 

 

 

EPS - Non GAAP

 

$0.77-$0.92

 

 

 

 

(1) Note that GAAP reporting of R&D and SG&A include stock based compensation expense

 

There will be a conference call with management today at 8:30 a.m. Eastern Time to discuss second quarter and first half 2008 financial results, guidance and operational developments.  The conference call will be available via phone and webcast.  The webcast can be accessed at The Medicines Company website at www.themedicinescompany.com.

 

The dial in information is listed below:

Domestic Dial In: 877-419-6590

International Dial In: 719-325-4894

 

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Replay is available from 11:30 a.m. Eastern Time following the conference call through August 6, 2008.  To hear a replay of the call, dial 888-203-1112 (domestic) and 719-457-0820 (international).  Passcode for both dial in numbers is 4642411.

 

MDCO-F

 

About The Medicines Company: The Medicines Company (NASDAQ: MDCO) is focused on advancing the treatment of critical care patients through the delivery of innovative, cost-effective medicines to the worldwide hospital marketplace. The Company markets Angiomax® (bivalirudin) in the United States and other countries for use in patients undergoing coronary angioplasty, a procedure to clear restricted blood flow in arteries around the heart. The Company also has two products in late-stage development, Cleviprex™ (clevidipine butyrate) injectable emulsion and cangrelor. The Company’s website is www.themedicinescompany.com.

 

This document is intended to assist listeners of The Medicines Company’s quarterly results conference call available via webcast at www.themedicinescompany.com.  In this document and the call, statements about The Medicines Company that are not purely historical, and all other statements that are not purely historical, may be deemed to be forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, the words “believes,” “anticipates” and “expects” and similar expressions, including our 2008 guidance, are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that may cause the Company’s actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements.  Important factors that may cause or contribute to such differences include the extent of the commercial success of Angiomax, whether the Company’s products will advance in the clinical trials process on a timely basis or at all, whether the Company will make regulatory submissions for product candidates on a timely basis, whether its regulatory submissions will receive approvals from regulatory agencies on a timely basis or at all, whether physicians, patients and other key decision makers will accept clinical trial results, risks associated with the establishment of international operations, and such other factors as are set forth in the risk factors detailed from time to time in the Company’s periodic reports and registration statements filed with the Securities and Exchange Commission including, without limitation, the risk factors detailed in the Company’s Quarterly Report on Form 10-Q filed on May 12, 2008, which are incorporated herein by reference. The Company specifically disclaims any obligation to update these forward-looking statements.

 

5


 

The Medicines Company

Consolidated Statements of Operations

(unaudited)

 

 

 

Three months ended June 30,

 

(in thousands, except per share data)

 

2008

 

2007

 

 

 

 

 

 

 

Net revenue

 

$

86,731

 

$

56,399

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Cost of revenue

 

21,939

 

15,094

 

Research and development

 

19,781

 

15,729

 

Selling, general and administrative

 

38,789

 

26,819

 

Total operating expenses

 

80,509

 

57,642

 

 

 

 

 

 

 

Income (loss) from operations

 

6,222

 

(1,243

)

 

 

 

 

 

 

Other income

 

1,805

 

2,719

 

 

 

 

 

 

 

Income before income taxes

 

8,027

 

1,476

 

Provision for income taxes

 

(3,971

)

(659

)

 

 

 

 

 

 

Net income

 

$

4,056

 

$

817

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.08

 

$

0.02

 

Shares used in computing basic earnings per common share

 

51,834

 

51,638

 

 

 

 

 

 

 

Diluted earnings per common share

 

$

0.08

 

$

0.02

 

Shares used in computing diluted earnings per common share

 

52,441

 

52,294

 

 

6


 

 

 

Six Months Ended June 30,

 

(in thousands, except per share data)

 

2008

 

2007

 

Net revenue

 

$

166,159

 

$

123,046

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Cost of revenue

 

41,032

 

32,874

 

Research and development

 

38,443

 

35,208

 

Selling, general and administrative

 

74,139

 

53,957

 

Total operating expenses

 

153,614

 

122,039

 

 

 

 

 

 

 

Income from operations

 

12,545

 

1,007

 

 

 

 

 

 

 

Other income

 

4,186

 

5,302

 

Income before income taxes

 

16,731

 

6,309

 

Provision for income taxes

 

(7,821

)

(2,444

)

Net income

 

$

8,910

 

$

3,865

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.17

 

$

0.07

 

Shares used in computing basic earnings per common share

 

51,792

 

51,578

 

 

 

 

 

 

 

Diluted earnings per common share

 

$

0.17

 

$

0.07

 

Shares used in computing diluted earnings per common share

 

52,361

 

52,587

 

 

7


 

The Medicines Company

Condensed Consolidated Balance Sheets

(unaudited)

 

 

 

June 30,

 

December 31,

 

(in thousands)

 

2008

 

2007

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

Cash, cash equivalents and available for sales securities

 

$

238,068

 

$

222,113

 

Accrued interest receivable

 

1,071

 

1,598

 

Accounts receivable, net

 

25,081

 

25,584

 

Inventory

 

29,567

 

35,468

 

Prepaid expenses and other current assets

 

10,949

 

7,425

 

Total current assets

 

304,736

 

292,188

 

 

 

 

 

 

 

Fixed assets, net

 

4,054

 

3,245

 

Intangible assets, net

 

14,641

 

14,929

 

Restricted cash

 

5,000

 

5,000

 

Deferred tax assets

 

39,433

 

46,018

 

Other assets

 

181

 

136

 

Total assets

 

$

368,045

 

$

361,516

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities

 

$

68,454

 

$

83,620

 

Stockholders’ equity

 

299,591

 

277,896

 

Total liabilities and stockholders’ equity

 

$

368,045

 

$

361,516

 

 

8


 

The Medicines Company

Reconciliation of GAAP to non-GAAP Measures

(Amounts in thousands, except per share data)

(Unaudited)

 

 

 

Three Months Ended June 30,

 

 

 

2008

 

 

 

 

 

 

 

Non-Cash

 

 

 

 

 

GAAP (1)

 

 

 

Tax

 

Non-GAAP (4)

 

 

 

As Reported

 

SFAS123R

 

Provision

 

As Adjusted

 

Net revenue

 

$

86,731

 

$

—

 

$

—

 

$

86,731

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Cost of revenue

 

21,939

 

(219

)(2)

—

 

21,720

 

Research and development

 

19,781

 

(1,192

)(2)

—

 

18,589

 

Selling, general and administrative

 

38,789

 

(5,451

)(2)

—

 

33,338

 

Total operating expenses

 

80,509

 

(6,862

)

—

 

73,647

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

6,222

 

6,862

 

—

 

13,084

 

 

 

 

 

 

 

 

 

 

 

Other income

 

1,805

 

—

 

—

 

1,805

 

Income before income taxes

 

8,027

 

6,862

 

—

 

14,889

 

Provision for income taxes

 

(3,971

)

—

 

3,586

(3)

(385

)

Net income

 

4,056

 

6,862

 

3,586

 

14,504

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.08

 

$

0.13

 

$

0.07

 

$

0.28

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing basic earnings per common share

 

51,834

 

51,834

 

51,834

 

51,834

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share

 

$

0.08

 

$

0.13

 

$

0.07

 

$

0.28

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing diluted earnings per common share

 

52,441

 

52,441

 

52,441

 

52,441

 

 

(1)          GAAP Results

(2)          Non-cash stock compensation expense

(3)          Non-cash tax provision

(4)          Non-GAAP Results

 

9


 

 

 

Six Months Ended June 30,

 

 

 

2008

 

 

 

 

 

 

 

Non-Cash

 

 

 

 

 

GAAP (1)

 

 

 

Tax

 

Non-GAAP (4)

 

 

 

As Reported

 

SFAS123R

 

Provision

 

As Adjusted

 

Net revenue

 

$

166,159

 

$

—

 

$

—

 

$

166,159

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Cost of revenue

 

41,032

 

(356

)(2)

—

 

40,676

 

Research and development

 

38,443

 

(1,872

)(2)

—

 

36,571

 

Selling, general and administrative

 

74,139

 

(9,196

)(2)

—

 

64,943

 

Total operating expenses

 

153,614

 

(11,424

)

—

 

142,190

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

12,545

 

11,424

 

—

 

23,969

 

 

 

 

 

 

 

 

 

 

 

Other income

 

4,186

 

—

 

—

 

4,186

 

Income before income taxes

 

16,731

 

11,424

 

—

 

28,155

 

Provision for income taxes

 

(7,821

)

—

 

6,602

(3)

(1,219

)

Net income

 

8,910

 

11,424

 

6,602

 

26,936

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

 

$

0.17

 

$

0.22

 

$

0.13

 

$

0.52

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing basic earnings per common share

 

51,792

 

51,792

 

51,792

 

51,792

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share

 

$

0.17

 

$

0.22

 

$

0.13

 

$

0.51

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing diluted earnings per common share

 

52,361

 

52,361

 

52,361

 

52,361

 

 

(1)          GAAP Results

(2)          Non-cash stock compensation expense

(3)          Non-cash tax provision

(4)          Non-GAAP Results

 

10