Biogen Idec today reported second quarter 2014 results, including revenue of $2.4 billion, a 40% increase compared to the second quarter of 2013. Second quarter 2014 non-GAAP diluted earnings per share (EPS) were $3.49, an increase of 52% over the second quarter of 2013. Non-GAAP net income attributable to Biogen Idec for the second quarter was $829 million, an increase of 51% over the second quarter of 2013.
On a reported basis, GAAP diluted EPS for the second quarter of 2014 were $3.01, an increase of 46% over the second quarter of 2013. GAAP net income attributable to Biogen Idec for the second quarter of 2014 was $715 million, an increase of 46% versus the same period in the prior year. (A reconciliation of GAAP to Non-GAAP quarterly financial results and 2014 full year guidance can be found in Table 3 at the end of this release).
Non-GAAP and GAAP diluted EPS benefited by approximately $0.15 and $0.13, respectively, following the approval of an agreement with the Italian National Medicines Agency (AIFA) relating to TYSABRI® sales in Italy from February 2013 through March 31, 2014.
“This past quarter highlighted significant accomplishments across our business, from the approval of ELOCTATE for hemophilia A, to the continued patient uptake of TECFIDERA in the U.S. and new markets worldwide, to strong clinical results for important emerging MS treatments,” said Chief Executive Officer George A. Scangos, Ph.D. “During this time we also announced our intent with Swedish Orphan Biovitrum AB to donate up to one billion international units of clotting factor to humanitarian organizations, which we hope will have a significant impact on the lives of patients in developing countries who may otherwise not have access to these therapies.”
“We remain focused on additional potential approvals and pivotal read-outs, and continue to look to increase investment in early-stage research to broaden and advance our neurology, immunology and hematology pipelines,” Dr. Scangos added.
Second Quarter 2014 Performance Highlights
TECFIDERA revenues were $700 million, consisting of $585 million in U.S. sales and $115 million in sales outside the U.S.
AVONEX® revenues were $774 million in the second quarter of 2014. The total was composed of $498 million in U.S. sales and $276 million in sales outside the U.S.
TYSABRI revenues were $533 million, consisting of $250 million in U.S. sales and $284 million in sales outside the U.S.
TYSABRI sales outside the U.S. included $54 million of previously deferred revenue from February 2013 through March 31, 2014, which was recognized during the quarter following an agreement with AIFA. Beginning in the second quarter of 2014, sales of TYSABRI in Italy were recorded at the full reimbursed price. The Company continues to be in discussions with AIFA to resolve its dispute for the periods February 2009 through January 2013.
Net revenues relating to RITUXAN® and GAZYVA® from our unconsolidated joint business arrangement were $303 million in the second quarter of 2014, compared to $289 million in the second quarter of 2013.
ALPROLIXTM revenues were $10 million in the second quarter of 2014.
Other Financial Results
Revenues for FAMPYRA® and FUMADERMTM were $38 million in the second quarter of 2014, compared to $33 million in the second quarter of 2013.
Royalty revenues were $40 million in the second quarter of 2014, compared to $38 million in the second quarter of 2013.
Corporate partner revenues were $22 million in the second quarter of 2014, compared to $11 million in the second quarter of 2013.
As of June 30, 2014, Biogen Idec had cash, cash equivalents and marketable securities totaling approximately $2.6 billion.
Updated 2014 Financial Guidance
Biogen Idec increased its full year 2014 financial guidance. This change represents a meaningful increase from prior guidance owing primarily to the growth of TECFIDERA in the U.S. and the E.U., the strength of our other MS therapies, and clarity on the AIFA pricing matter.
This guidance consists of the following components:
Revenue growth is expected to be approximately 38% to 41%.
R&D expense is expected to be approximately 20% to 21% of total revenue.
For the balance of the year, full year guidance for R&D expense includes greater than $150 million intended for new early and mid-stage business development opportunities.
SG&A expense is expected to be approximately 22% to 23% of total revenue.
GAAP diluted EPS is expected to be between $11.26 and $11.46.
Non-GAAP diluted EPS is expected to be between $12.90 and $13.10.
Biogen Idec may incur charges, realize gains or experience other events in 2014 that could cause actual results to vary from this guidance.
Multiple Sclerosis (MS) Events
In May 2014, Biogen Idec received a positive recommendation from the Committee for Medicinal Products for Human Use of the European Medicines Agency for the marketing authorization of PLEGRIDY™ (Peginterferon Beta-1a), a pegylated interferon administered subcutaneously for adults with relapsing-remitting multiple sclerosis.
In June 2014, Biogen Idec and AbbVie announced positive top-line results from the Phase 3 DECIDE clinical trial investigating Daclizumab High Yield Process (HYP) in MS, with Daclizumab HYP demonstrating superiority over interferon beta-1a in annual relapse rate.
At the 66th American Academy of Neurology (AAN) annual meeting in April and May 2014, Biogen Idec presented new data on several of its MS programs, including:
Two-year data from its Phase 3 ADVANCE clinical trial for PLEGRIDY in people with relapsing MS.
Data that reinforces the efficacy of TECFIDERA (dimethyl fumarate) in a wide range of patients with relapsing MS, as well as support for its favorable safety and tolerability profile in the real-world setting.
Post hoc analysis of data from the AFFIRM study demonstrating improvement in walking speed for TYSABRI (natalizumab) relative to placebo at two years.
Additional data from observational registry studies showing the benefit of switching to TYSABRI after experiencing an MS relapse while taking interferon beta or glatiramer acetate.
In June 2014, the U.S. Food and Drug Administration approved ELOCTATE [Antihemophilic Factor (Recombinant), Fc Fusion Protein] for the control and prevention of bleeding episodes, surgical management and routine prophylaxis in adults and children with hemophilia A.
In July 2014, ALPROLIX [Coagulation Factor IX (Recombinant), Fc Fusion Protein] for hemophilia B obtained marketing approval from Japan’s Ministry of Health, Labor and Welfare, while ELOCTATE for hemophilia A was approved by Australia’s Therapeutic Goods Administration.
At the World Federation of Hemophilia 2014 World Congress in May 2014, Biogen Idec and Swedish Orphan Biovitrum AB announced their intent to donate up to one billion international units of clotting factor therapy for humanitarian aid programs in the developing world.
In April 2014, Biogen Idec and Quintiles entered into a five-year strategic clinical development agreement to help optimize Biogen Idec’s clinical development processes.
In May 2014, Biogen Idec announced that Richard A. Rudick, M.D., has joined the Company as Vice President, Development Sciences, Value-Based Medicine. Dr. Rudick will lead Biogen Idec’s newly created Value-Based Medicine Group, which will focus on using advanced technologies to develop innovative programs and tools to better understand, measure and manage the treatment of multiple sclerosis.
During the second quarter of 2014, the Company made a $35 million donation to the Biogen Idec Foundation to support the Foundation’s mission of providing grants to STEM (Science, Technology, Engineering, Math) education programs.