Alkermes plc Reports Third Quarter 2024 Financial Results
— Third Quarter Revenues of
—
— GAAP Net Income from Continuing Operations of
— Company Reiterates 2024 Financial Expectations —
"Our third quarter financial results reflect strong year-over-year growth of our portfolio of proprietary commercial products and position us well to meet our strategic, operational and financial priorities for the year. Looking ahead, we believe growing our proprietary commercial products and advancing our pipeline, particularly ALKS 2680, our novel, investigational, orexin 2 receptor agonist, and additional orexin development candidates, will serve as the key drivers of shareholder value. We plan to manage the business to deliver significant profitability and cash flow while investing in these strategic initiatives," said
Key Financial Highlights
Revenues |
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||||||
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(In millions) |
Three Months Ended |
|
Nine Months Ended |
||||||
|
2024 |
2023 |
|
2024 |
2023 |
||||
Total Revenues |
$ |
378.1 |
$ |
380.9 |
|
$ |
1,127.6 |
$ |
1,285.9* |
Total Proprietary Net Sales |
$ |
273.0 |
$ |
231.8 |
|
$ |
775.8 |
$ |
678.0 |
VIVITROL® |
$ |
113.7 |
$ |
99.3 |
|
$ |
323.2 |
$ |
298.0 |
ARISTADA®i |
$ |
84.7 |
$ |
81.8 |
|
$ |
249.6 |
$ |
244.3 |
LYBALVI® |
$ |
74.7 |
$ |
50.7 |
|
$ |
203.1 |
$ |
135.7 |
Profitability |
|
|
|
||||||
|
|
|
|
||||||
(In millions) |
Three Months Ended |
|
Nine Months Ended |
||||||
|
2024 |
2023 |
|
2024 |
2023* |
||||
GAAP Net Income From Continuing Operations |
$ |
92.8 |
$ |
91.6 |
|
$ |
226.4 |
$ |
358.6 |
GAAP Net Loss From Discontinued Operations |
$ |
(0.4) |
$ |
(43.8) |
|
$ |
(5.8) |
$ |
(115.6) |
GAAP Net Income |
$ |
92.4 |
$ |
47.8 |
|
$ |
220.6 |
$ |
243.0 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income From Continuing Operations |
$ |
121.4 |
$ |
150.4 |
|
$ |
321.0 |
$ |
314.7 |
Non-GAAP Net Loss From Discontinued Operations |
$ |
(0.4) |
$ |
(40.8) |
|
$ |
(5.8) |
$ |
(108.5) |
Non-GAAP Net Income |
$ |
121.0 |
$ |
109.5 |
|
$ |
315.2 |
$ |
206.2 |
|
|
|
|
|
|
|
|
|
|
EBITDA From Continuing Operations |
$ |
112.3 |
$ |
107.2 |
|
$ |
282.4 |
$ |
413.5 |
EBITDA From Discontinued Operations |
$ |
(0.5) |
$ |
(44.6) |
|
$ |
(6.9) |
$ |
(121.9) |
EBITDA |
$ |
111.8 |
$ |
62.7 |
|
$ |
275.5 |
$ |
291.5 |
*As a result of the successful resolution of the arbitration with Janssen Pharmaceutica N.V., the nine months ended
Revenue Highlights
LYBALVI
- Revenues for the quarter were
$74.7 million . - Revenues and total prescriptions for the quarter grew 47% and 37%, respectively, compared to the third quarter of 2023.
ARISTADAi
- Revenues for the quarter were
$84.7 million .
VIVITROL
- Revenues for the quarter were
$113.7 million . - Revenues for the quarter grew 14% compared to the third quarter of 2023, driven by the alcohol dependence indication.
Manufacturing & Royalty Revenues
- Royalty revenues from INVEGA SUSTENNA®/XEPLION®, INVEGA TRINZA®/TREVICTA® and INVEGA HAFYERA®/BYANNLI® for the quarter were
$58.4 million . - VUMERITY® manufacturing and royalty revenues for the quarter were
$32.6 million .
Key Operating Expenses
Please see Note 1 below for details regarding discontinued operations.
(In millions) |
Three Months Ended |
Nine Months Ended |
||||||
|
2024 |
2023 |
2024 |
2023 |
||||
R&D Expense – Continuing Operations |
$ |
59.9 |
$ |
64.9 |
$ |
187.2 |
$ |
196.9 |
R&D Expense – Discontinued Operations |
$ |
0.5 |
$ |
32.3 |
$ |
6.9 |
$ |
94.7 |
|
|
|
|
|
|
|||
SG&A Expense – Continuing Operations |
$ |
150.4 |
$ |
156.4 |
$ |
498.2 |
$ |
520.0 |
SG&A Expense – Discontinued Operations |
$ |
- |
$ |
13.1 |
$ |
- |
$ |
29.2 |
Balance Sheet
At
Share Repurchase Program
During the third quarter of 2024, the company repurchased approximately 4.4 million of the company's ordinary shares under the share repurchase program authorized in
Financial Expectations for 2024
Alkermes reiterates its financial expectations for 2024, as set forth in its press release dated Feb. 15, 2024.
Recent Events
- In
October 2024 , the company hosted an investor event to review its portfolio of orexin 2 receptor agonists and development strategy. The company presented data from its ALKS 2680 phase 1b study in patients with narcolepsy type 1 (NT1), narcolepsy type 2 (NT2) and idiopathic hypersomnia (IH), and discussed the study design for its ongoing phase 2 studies in NT1 and NT2. The company also announced its plans to initiate a phase 2 study in patients with IH in 2025. - In
September 2024 , the company presented positive clinical data from its phase 1b study of ALKS 2680 in patients with NT2 and IH at theEuropean Sleep Research Society's 27thCongress , Sleep Europe 2024. - In
August 2024 , the company announced the initiation of its Vibrance-2 phase 2 study of ALKS 2680 in patients with NT2. - In
August 2024 , the company published its latest Corporate Responsibility Report, which details how the company integrates environmental, social and governance considerations into its business. A copy of the report is available on the Responsibility section of Alkermes' website.
Notes and Explanations
1. The company determined that upon the separation of its oncology business, completed on
Conference Call
Alkermes will host a conference call and webcast presentation with accompanying slides at
About Alkermes plc
Non-GAAP Financial Measures
This press release includes information about certain financial measures that are not prepared in accordance with generally accepted accounting principles in the
Non-GAAP net income adjusts for certain one-time and non-cash charges by excluding from GAAP results: share-based compensation expense; amortization; depreciation; non-cash net interest expense; change in the fair value of contingent consideration; certain other one-time or non-cash items; and the income tax effect of these reconciling items. EBITDA represents earnings before interest, tax, depreciation and amortization; earnings include share-based compensation expense.
The company's management and board of directors utilize these non-GAAP financial measures to evaluate the company's performance. The company provides these non-GAAP financial measures of the company's performance to investors because management believes that these non-GAAP financial measures, when viewed with the company's results under GAAP and the accompanying reconciliations, are useful in identifying underlying trends in ongoing operations. However, non-GAAP net income and EBITDA are not measures of financial performance under GAAP and, accordingly, should not be considered as alternatives to GAAP measures as indicators of operating performance. Further, non-GAAP net income and EBITDA should not be considered measures of the company's liquidity.
A reconciliation of GAAP to non-GAAP financial measures has been provided in the tables included in this press release.
Note Regarding Forward-Looking Statements
Certain statements set forth in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including, but not limited to, statements concerning: the company's expectations concerning its future financial and operating performance, business plans or prospects, including drivers of shareholder value and profitability; and the company's expectations regarding development plans, activities and timelines for, and the potential therapeutic and commercial value of, ALKS 2680 and the company's other orexin portfolio candidates. The company cautions that forward-looking statements are inherently uncertain. The forward-looking statements are neither promises nor guarantees and they are necessarily subject to a high degree of uncertainty and risk. Actual performance and results may differ materially from those expressed or implied in the forward-looking statements due to various risks and uncertainties. These risks and uncertainties include, among others: whether the company is able to achieve its financial expectations, including those related to profitability; the unfavorable outcome of arbitration or litigation, including so-called "Paragraph IV" litigation and other patent litigation which may lead to competition from generic drug manufacturers, or other disputes related to the company's products or products using the company's proprietary technologies; clinical development activities may not be completed on time or at all; the results of the company's development activities may not be positive, or predictive of final results from such activities, results of future development activities or real-world results; the
VIVITROL® is a registered trademark of
i The term "ARISTADA" as used in this press release refers to ARISTADA and ARISTADA INITIO®, unless the context indicates otherwise.
|
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Selected Financial Information (Unaudited) |
||||
|
|
|
|
|
Condensed Consolidated Statements of Operations - GAAP |
|
Three Months Ended |
|
Three Months Ended |
(In thousands, except per share data) |
|
|
|
|
Revenues: |
|
|
|
|
Product sales, net |
|
$ 272,999 |
|
$ 231,822 |
Manufacturing and royalty revenues |
|
105,144 |
|
149,113 |
Research and development revenue |
|
— |
|
3 |
Total Revenues |
|
378,143 |
|
380,938 |
Expenses: |
|
|
|
|
Cost of goods manufactured and sold |
|
63,099 |
|
61,498 |
Research and development |
|
59,892 |
|
64,878 |
Selling, general and administrative |
|
150,382 |
|
156,373 |
Amortization of acquired intangible assets |
|
14 |
|
8,995 |
Total Expenses |
|
273,387 |
|
291,744 |
Operating Income |
|
104,756 |
|
89,194 |
Other Income, net: |
|
|
|
|
Interest income |
|
10,916 |
|
9,370 |
Interest expense |
|
(6,000) |
|
(6,006) |
Other income, net |
|
558 |
|
149 |
Total Other Income, net |
|
5,474 |
|
3,513 |
Income Before Income Taxes |
|
110,230 |
|
92,707 |
Income Tax Provision |
|
17,435 |
|
1,153 |
Net Income From Continuing Operations |
|
92,795 |
|
91,554 |
Loss From Discontinued Operations — Net of Tax |
|
(414) |
|
(43,796) |
Net Income — GAAP |
|
$ 92,381 |
|
$ 47,758 |
|
|
|
|
|
GAAP Earnings (Loss) Per Ordinary Share - Basic: |
|
|
|
|
From continuing operations |
|
$ 0.57 |
|
$ 0.55 |
From discontinued operations |
|
$ (0.00) |
|
$ (0.26) |
From net income |
|
$ 0.57 |
|
$ 0.29 |
|
|
|
|
|
GAAP Earnings (Loss) Per Ordinary Share - Diluted: |
|
|
|
|
From continuing operations |
|
$ 0.56 |
|
$ 0.53 |
From discontinued operations |
|
$ (0.00) |
|
$ (0.25) |
From net income |
|
$ 0.55 |
|
$ 0.28 |
|
|
|
|
|
Weighted Average Number of Ordinary Shares Outstanding: |
|
|
|
|
Basic — GAAP and Non-GAAP |
|
163,368 |
|
166,607 |
Diluted — GAAP and Non-GAAP |
|
167,025 |
|
171,903 |
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of Operations - GAAP (Continued) |
|
Three Months Ended |
|
Three Months Ended |
(In thousands, except per share data) |
|
|
|
|
An itemized reconciliation between net income from continuing operations on a GAAP basis and EBITDA is as follows: |
|
|
|
|
Net Income from Continuing Operations |
|
$ 92,795 |
|
$ 91,554 |
Adjustments: |
|
|
|
|
Depreciation expense |
|
6,958 |
|
8,886 |
Amortization expense |
|
14 |
|
8,995 |
Interest income |
|
(10,916) |
|
(9,370) |
Interest expense |
|
6,000 |
|
6,006 |
Income tax provision |
|
17,435 |
|
1,153 |
EBITDA from Continuing Operations |
|
112,286 |
|
107,224 |
EBITDA from Discontinued Operations |
|
(481) |
|
(44,567) |
EBITDA |
|
$ 111,805 |
|
$ 62,657 |
|
|
|
|
|
An itemized reconciliation between net income from continuing operations on a GAAP basis and non-GAAP net income is as follows: |
||||
Net Income from Continuing Operations |
|
$ 92,795 |
|
$ 91,554 |
Adjustments: |
|
|
|
|
Share-based compensation expense |
|
22,533 |
|
21,733 |
Depreciation expense |
|
6,958 |
|
8,886 |
Amortization expense |
|
14 |
|
8,995 |
Non-cash net interest expense |
|
114 |
|
115 |
Separation expense |
|
206 |
|
9,640 |
Income tax effect related to reconciling items |
|
(1,255) |
|
3,511 |
Restructuring expense |
|
— |
|
5,938 |
Non-GAAP Net Income from Continuing Operations |
|
121,365 |
|
150,372 |
Non-GAAP Net Loss from Discontinued Operations |
|
(414) |
|
(40,835) |
Non-GAAP Net Income |
|
$ 120,951 |
|
$ 109,537 |
|
|
|
|
|
Non-GAAP diluted earnings per ordinary share from continuing operations |
|
$ 0.73 |
|
$ 0.87 |
Non-GAAP diluted loss per ordinary share from discontinued operations |
|
$ (0.00) |
|
$ (0.24) |
Non-GAAP diluted earnings per ordinary share from net income |
|
$ 0.72 |
|
$ 0.64 |
|
|
|
|
|
|
|
|
|
|
|
||||
Selected Financial Information (Unaudited) |
||||
|
|
|
|
|
Condensed Consolidated Statements of Operations - GAAP |
|
Nine Months Ended |
|
Nine Months Ended |
(In thousands, except per share data) |
|
|
|
|
Revenues: |
|
|
|
|
Product sales, net |
|
$ 775,808 |
|
$ 678,026 |
Manufacturing and royalty revenues |
|
351,835 |
|
607,888 |
Research and development revenue |
|
3 |
|
16 |
Total Revenues |
|
1,127,646 |
|
1,285,930 |
Expenses: |
|
|
|
|
Cost of goods manufactured and sold |
|
183,215 |
|
182,911 |
Research and development |
|
187,152 |
|
196,873 |
Selling, general and administrative |
|
498,244 |
|
519,962 |
Amortization of acquired intangible assets |
|
1,087 |
|
26,693 |
Total Expenses |
|
869,698 |
|
926,439 |
Operating Income |
|
257,948 |
|
359,491 |
Other Income, net: |
|
|
|
|
Interest income |
|
31,050 |
|
21,105 |
Interest expense |
|
(17,930) |
|
(16,978) |
Other income (expense), net |
|
2,793 |
|
(415) |
Total Other Income, net |
|
15,913 |
|
3,712 |
Income Before Income Taxes |
|
273,861 |
|
363,203 |
Income Tax Provision |
|
47,460 |
|
4,598 |
Net Income From Continuing Operations |
|
226,401 |
|
358,605 |
Loss From Discontinued Operations — Net of Tax |
|
(5,834) |
|
(115,627) |
Net Income — GAAP |
|
$ 220,567 |
|
$ 242,978 |
|
|
|
|
|
GAAP Earnings (Loss) Per Ordinary Share - Basic: |
|
|
|
|
From continuing operations |
|
$ 1.36 |
|
$ 2.16 |
From discontinued operations |
|
$ (0.04) |
|
$ (0.70) |
From net income |
|
$ 1.32 |
|
$ 1.47 |
|
|
|
|
|
GAAP Earnings (Loss) Per Ordinary Share - Diluted: |
|
|
|
|
From continuing operations |
|
$ 1.33 |
|
$ 2.10 |
From discontinued operations |
|
$ (0.03) |
|
$ (0.68) |
From net income |
|
$ 1.30 |
|
$ 1.42 |
|
|
|
|
|
Weighted Average Number of Ordinary Shares Outstanding: |
|
|
|
|
Basic — GAAP and Non-GAAP |
|
166,546 |
|
165,686 |
Diluted — GAAP and Non-GAAP |
|
170,196 |
|
170,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of Operations - GAAP (Continued) |
|
Nine Months Ended |
|
Nine Months Ended |
(In thousands, except per share data) |
|
|
|
|
An itemized reconciliation between net income from continuing operations on a GAAP basis and EBITDA is as follows: |
|
|
|
|
Net Income from Continuing Operations |
|
$ 226,401 |
|
$ 358,605 |
Adjustments: |
|
|
|
|
Depreciation expense |
|
20,599 |
|
27,696 |
Amortization expense |
|
1,087 |
|
26,693 |
Interest income |
|
(31,050) |
|
(21,105) |
Interest expense |
|
17,930 |
|
16,978 |
Income tax provision |
|
47,460 |
|
4,598 |
EBITDA from Continuing Operations |
|
282,427 |
|
413,465 |
EBITDA from Discontinued Operations |
|
(6,910) |
|
(121,947) |
EBITDA |
|
$ 275,517 |
|
$ 291,518 |
|
|
|
|
|
An itemized reconciliation between net income from continuing operations on a GAAP basis and non-GAAP net income is as follows: |
||||
Net Income from Continuing Operations |
|
$ 226,401 |
|
$ 358,605 |
Adjustments: |
|
|
|
|
Share-based compensation expense |
|
75,889 |
|
69,943 |
Depreciation expense |
|
20,599 |
|
27,696 |
Amortization expense |
|
1,087 |
|
26,693 |
Separation expense |
|
1,446 |
|
19,280 |
Income tax effect related to reconciling items |
|
(3,316) |
|
3,332 |
Gain on sale of Athlone manufacturing facility |
|
(1,462) |
|
— |
Restructuring expense |
|
— |
|
5,938 |
Final award in the Janssen arbitration (2022 back royalties and interest) |
|
— |
|
(197,092) |
Non-cash net interest expense |
|
342 |
|
346 |
Non-GAAP Net Income from Continuing Operations |
|
320,986 |
|
314,741 |
Non-GAAP Net Loss from Discontinued Operations |
|
(5,834) |
|
(108,511) |
Non-GAAP Net Income |
|
$ 315,152 |
|
$ 206,230 |
|
|
|
|
|
Non-GAAP diluted earnings per ordinary share from continuing operations |
|
$ 1.89 |
|
$ 1.84 |
Non-GAAP diluted loss per ordinary share from discontinued operations |
|
$ (0.03) |
|
$ (0.64) |
Non-GAAP diluted earnings per ordinary share from net income |
|
$ 1.85 |
|
$ 1.21 |
|
||||
Selected Financial Information (Unaudited) |
||||
|
|
|
|
|
Condensed Consolidated Balance Sheets |
|
|
|
|
(In thousands) |
|
2024 |
|
2023 |
Cash, cash equivalents and total investments |
|
$ 927,784 |
|
$ 813,378 |
Receivables |
|
367,211 |
|
332,477 |
Inventory |
|
191,087 |
|
186,406 |
Contract assets |
|
2,969 |
|
706 |
Prepaid expenses and other current assets |
|
94,047 |
|
98,166 |
Property, plant and equipment, net |
|
225,422 |
|
226,943 |
Intangible assets, net and goodwill |
|
83,931 |
|
85,018 |
Assets held for sale |
|
— |
|
94,260 |
Deferred tax assets |
|
159,960 |
|
195,888 |
Other assets |
|
102,880 |
|
102,981 |
Total Assets |
|
$ 2,155,291 |
|
$ 2,136,223 |
Long-term debt — current portion |
|
$ 3,000 |
|
$ 3,000 |
Other current liabilities |
|
450,705 |
|
512,678 |
Long-term debt |
|
285,823 |
|
287,730 |
Liabilities from discontinued operations |
|
— |
|
4,542 |
Other long-term liabilities |
|
123,658 |
|
125,587 |
Total shareholders' equity |
|
1,292,105 |
|
1,202,686 |
Total Liabilities and Shareholders' Equity |
|
$ 2,155,291 |
|
$ 2,136,223 |
|
|
|
|
|
Ordinary shares outstanding (in thousands) |
|
161,776 |
|
166,980 |
|
|
|
|
|
This selected financial information should be read in conjunction with the consolidated financial statements and notes thereto included in |
|
||||||||
Amounts Included in Discontinued Operations |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
Three Months
|
|
Three Months
|
|
Three Months
|
|
Nine Months
|
Cost of goods manufactured and sold |
|
$ — |
|
$ — |
|
$ — |
|
$ — |
Research and development |
|
2,516 |
|
3,913 |
|
481 |
|
6,910 |
Selling, general and administrative |
|
— |
|
— |
|
— |
|
— |
Income tax benefit |
|
(396) |
|
(613) |
|
(67) |
|
(1,076) |
Loss from discontinued operations, net of tax |
|
$ 2,120 |
|
$ 3,300 |
|
$ 414 |
|
$ 5,834 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
Three Months
|
|
Three Months
|
|
Three Months
|
|
Nine Months
|
Cost of goods manufactured and sold |
|
$ 11 |
|
$ 11 |
|
$ 11 |
|
$ 33 |
Research and development |
|
29,867 |
|
32,563 |
|
32,262 |
|
94,692 |
Selling, general and administrative |
|
6,644 |
|
9,502 |
|
13,073 |
|
29,219 |
Income tax benefit |
|
(6,727) |
|
(40) |
|
(1,550) |
|
(8,317) |
Loss from discontinued operations, net of tax |
|
$ 29,795 |
|
$ 42,036 |
|
$ 43,796 |
|
$ 115,627 |
Alkermes Contacts: |
||
For Investors: |
Sandy Coombs |
+1 781 609 6377 |
For Media: |
Katie Joyce |
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