EX-99.1 2 a04-8040_2ex99d1.htm EX-99.1

EXHIBIT 99.1

 

 

ImClone Systems Incorporated

 

 

Investors:

 

Media:

Andrea F. Rabney

 

David M. F. Pitts

(646) 638-5058

 

(646) 638-5058

Stefania Bethlen

 

 

(646) 638-5058

 

 

 

For Immediate Release

 

IMCLONE SYSTEMS REPORTS SECOND QUARTER 2004 FINANCIAL RESULTS

 

Reports Fully Diluted Earnings Per Share of $.29

 

ERBITUX U.S. In-Market Quarterly Sales Reach $71.4 Million

 

New York, NY – July 21, 2004 – ImClone Systems Incorporated (NASDAQ: IMCL) announced today its financial results for the second quarter and six months ended June 30, 2004.

 

Total revenues for the second quarter of 2004 were $71.5 million as compared with $17.9 million for the second quarter of 2003 and $109.6 million in the first quarter of 2004. Revenues included four principal components:

•      License fees and milestone revenues of $18.1 million in the second quarter of 2004 compared with $11.5 million in the second quarter of 2003 and $67.5 million in the first quarter of 2004.  In 2004, first quarter license fees and milestone revenues were higher than second quarter amounts due to the receipt of a $250 million milestone payment in the first quarter and its resulting one time “catch-up” effect of approximately $42 million;

•      Manufacturing revenues of $14.8 million in the second quarter of 2004 (no manufacturing revenues were recorded in 2003) compared with $25.5 million in the first quarter of 2004.  Purchases by Bristol-Myers Squibb are timed at their discretion to accommodate forecasts and safety stock needs, and are not necessarily indicative of historical in-market sales or future sales expectations;

•      Royalty revenues of $28.5 million in the second quarter of 2004 (no royalty revenues were recorded in 2003) compared with $7.1 million in the first quarter of 2004.  Royalty revenues for the second quarter of 2004 include $27.8 million representing 39% of Bristol-Myers Squibb’s in-market ERBITUXTM (Cetuximab) net sales of $71.4 million, compared with first quarter in-market net sales of $17.5 million. These in-market sales, reflecting a drop-ship distribution methodology, represent ERBITUX shipments to end-user accounts only, with no wholesaler stocking; and

•      Collaborative agreement revenues of $10.1 million in the second quarter of 2004 compared with $6.4 million in the second quarter of 2003 and $9.5 million in the first quarter of 2004.

 

 

Total operating expenses for the second quarter of 2004 were $44.1 million, compared with $51.7 million in the second quarter of 2003. Operating expenses included three principal components:

•      Research and development expenses for the second quarter of 2004 were $18.8 million compared with $33.4 million in the second quarter of 2003. The principal reason for the decline is that prior to FDA approval of ERBITUX on February 12, 2004, costs to manufacture or purchase the product were included as a component of research and development expenses; subsequent to that date, such costs are capitalized as inventory;

•      Clinical and regulatory expenses in the second quarter of 2004 were $6.2 million compared with $8.4 million in the second quarter of 2003; and

•      Marketing, general and administrative expenses were $19.0 million in the second quarter of 2004 compared with $9.9 million in the second quarter of 2003. The increase principally reflects costs associated with our field force of Scientific Services Liaisons which was not in place in 2003, as well as the accrual of royalty expenses associated with certain business development transactions.

 

The effective tax rate for fiscal year 2004 is estimated to be 10%, which has been applied to the second quarter of 2004.

 

Net income for the second quarter of 2004 was $24.3 million with basic earnings per share of $.31 and fully diluted earnings per share of $.29, compared with a net loss of $34.8 million in the second quarter of 2003 with a loss per basic and fully diluted common share of $.47.

 

Total revenues for the six months ended June 30, 2004 were $181.2 million compared with $37.4 million for the same period in 2003. Operating expenses for the six months ended June 30, 2004 were $82.9 million compared with $105.6 million for the same period in 2003. Net income for the first six months of 2004 was $87.0 million with basic earnings per share of $1.14 and fully diluted earnings per share of $1.02 compared with a net loss for the same period in 2003 of $69.6 million, with a net loss per basic and fully diluted common share of $.94.

 

“This has been another successful quarter for the company from both a financial and product development standpoint,” stated Daniel S. Lynch, Chief Executive Officer of ImClone Systems. “Key milestones during the quarter included approval of ERBITUX for certain patients with late-stage colorectal cancer in the European Union, Iceland, Norway, Mexico, Argentina and Chile, the licensure of our BB36 manufacturing facility, the closing of a $600 million convertible note offering and the presentation of encouraging study data on ERBITUX at this year’s American Society of Clinical Oncology annual meeting.”

 

“We expect to remain a profitable entity for the balance of the year, with continued progress in the key aspects of our business, while managing expenses to maximize our long-term prospects,” said Michael J. Howerton, Chief Financial Officer of ImClone Systems.

 

Conference Call

ImClone Systems will host a conference call with the financial community to discuss 2004 second quarter financial results, today, July 21, 2004 at 11:00 AM Eastern Time.

 

The conference call will be webcast live and may be accessed by visiting ImClone Systems’ website at www.imclone.com. A replay of the audio webcast will be available under “Earnings Webcast” in the “Investor Relations” section of the Company’s website starting shortly after the call on July 21, 2004.

 

 

Those parties interested in participating via telephone may join by dialing (888) 694-4641, or (973) 935-8512 for calls outside of Canada and the United States. A telephone replay of the conference call will be available shortly after the call until July 28, 2004 at midnight Eastern Time. To access the telephone replay, dial (877) 519-4471 domestically, or (973) 341-3080 for calls outside of Canada and the United States, and enter passcode number 4697335.

 

About ImClone Systems Incorporated

ImClone Systems Incorporated is committed to advancing oncology care by developing and commercializing a portfolio of targeted biologic treatments designed to address the medical needs of patients with a variety of cancers. The Company’s three programs include growth factor blockers, angiogenesis inhibitors and cancer vaccines. ImClone Systems’ strategy is to become a fully integrated biopharmaceutical company, taking its development programs from the research stage to the market. ImClone Systems’ headquarters and research operations are located in New York City, with additional administration and manufacturing facilities in Branchburg, New Jersey.

 

Certain matters discussed in this news release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Federal securities laws. Although the company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. Forward-looking information is subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Many of these factors are beyond the company’s ability to control or predict. Important factors that may cause actual results to differ materially and could impact the company and the statements contained in this news release can be found in the company’s filings with the Securities and Exchange Commission, including quarterly reports on Form 10-Q, current reports on Form 8-K and annual reports on Form 10-K. For forward-looking statements in this news release, the company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The company assumes no obligation to update or supplement any forward-looking statements, whether as a result of new information, future events or otherwise.

 

(see attached tables)

 

 

IMCLONE SYSTEMS INCORPORATED

Consolidated Statements of Operations

(Unaudited)

(in thousands, except per share data)

 

 

 

Three Months Ended
June 30,

 

 

 

2004

 

2003

 

Revenues:

 

 

 

 

 

License fees and milestone revenue

 

$

18,148

 

$

11,457

 

Manufacturing revenue

 

14,796

 

—

 

Royalty revenue

 

28,460

 

—

 

Collaborative agreement revenue

 

10,133

 

6,418

 

Total revenues

 

71,537

 

17,875

 

Operating expenses:

 

 

 

 

 

Research and development

 

18,836

 

33,390

 

Clinical and regulatory

 

6,202

 

8,355

 

Marketing, general and administrative

 

18,982

 

9,948

 

Cost of manufacturing revenue

 

123

 

—

 

Other expense

 

—

 

32

 

Total operating expenses

 

44,143

 

51,725

 

 

 

 

 

 

 

Operating income (loss)

 

27,394

 

(33,850

)

 

 

 

 

 

 

Other expense, net

 

381

 

866

 

 

 

 

 

 

 

Income (loss) before income taxes

 

27,013

 

(34,716

)

Provision for income taxes

 

2,701

 

112

 

 

 

 

 

 

 

Net income (loss)

 

$

24,312

 

$

(34,828

)

 

 

 

 

 

 

Income (loss) per common share:

 

 

 

 

 

Basic

 

$

0.31

 

$

(0.47

)

Diluted

 

$

0.29

 

$

(0.47

)

Shares used in calculation of income (loss) per share

 

 

 

 

 

Basic

 

77,373

 

73,764

 

Diluted

 

89,127

 

73,764

 

 

 

IMCLONE SYSTEMS INCORPORATED

Consolidated Statements of Operations

(Unaudited)

(in thousands, except per share data)

 

 

 

First

 

Second

 

Six Months Ended

 

 

 

Quarter

 

Quarter

 

June 30,

 

 

 

2004

 

2004

 

2004

 

2003

 

Revenues:

 

 

 

 

 

 

 

 

 

License fees and milestone revenue

 

$

67,498

 

$

18,148

 

$

85,646

 

$

22,079

 

Manufacturing revenue

 

25,504

 

14,796

 

40,300

 

0

 

Royalty revenue

 

7,145

 

28,460

 

35,605

 

303

 

Collaborative agreement revenue

 

9,470

 

10,133

 

19,603

 

15,064

 

Total revenues

 

109,617

 

71,537

 

181,154

 

37,446

 

Operating expenses:

 

 

 

 

 

 

 

 

 

Research and development

 

20,211

 

18,836

 

39,047

 

72,430

 

Clinical and regulatory

 

7,062

 

6,202

 

13,264

 

16,002

 

Marketing, general and administrative

 

13,124

 

18,982

 

32,106

 

17,102

 

Cost of manufacturing revenue

 

213

 

123

 

336

 

—

 

Other (recoveries) expense

 

(1,815

)

—

 

(1,815

)

65

 

Total operating expenses

 

38,795

 

44,143

 

82,938

 

105,599

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

70,822

 

27,394

 

98,216

 

(68,153

)

 

 

 

 

 

 

 

 

 

 

Other expense, net

 

1,115

 

381

 

1,496

 

1,272

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

69,707

 

27,013

 

96,720

 

(69,425

)

Provision for income taxes

 

6,971

 

2,701

 

9,672

 

214

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

62,736

 

$

24,312

 

$

87,048

 

$

(69,639

)

 

 

 

 

 

 

 

 

 

 

Income (loss) per common share:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.83

 

$

0.31

 

$

1.14

 

$

(0.94

)

Diluted

 

$

0.76

 

$

0.29

 

$

1.02

 

$

(0.94

)

Shares used in calculation of income (loss) per share

 

 

 

 

 

 

 

 

 

Basic

 

75,259

 

77,373

 

76,316

 

73,757

 

Diluted

 

84,833

 

89,127

 

87,740

 

73,757

 

 

 

IMCLONE SYSTEMS INCORPORATED

Consolidated Condensed Balance Sheets

(Unaudited)

(in thousands)

 

 

 

June 30,

 

December 31,

 

 

 

2004

 

2003

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

560,049

 

$

56,850

 

Securities available for sale

 

347,373

 

49,498

 

Other current assets

 

88,005

 

16,222

 

Total current assets

 

995,427

 

122,570

 

 

 

 

 

 

 

Property, plant and equipment, net

 

291,881

 

245,901

 

Other assets

 

29,327

 

13,124

 

Total assets

 

$

1,316,635

 

$

381,595

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity (Deficit)

 

 

 

 

 

Current liabilities

 

$

169,587

 

$

125,785

 

Deferred revenue, long term

 

424,587

 

286,362

 

Long-term obligations

 

600,025

 

240,041

 

Total liabilities

 

1,194,199

 

652,188

 

 

 

 

 

 

 

Stockholders’ equity (deficit)

 

122,436

 

(270,593

)

Total liabilities and stockholders’ equity (deficit)

 

$

1,316,635

 

$

381,595