BioMarin Announces Second Quarter 2006 Financial Results
August 2, 2006
BioMarin Pharmaceutical Inc. (Nasdaq and SWX: BMRN) today announced results for its second quarter ended June 30, 2006. The net loss was $1.3 million ($0.02 per share) for the second quarter of 2006, compared to $21.3 million ($0.33 per share) for the second quarter of 2005. The net loss was $11.1 million ($0.14 per share) for the six months ended June 30, 2006, compared to $43.8 million ($0.68 per share) for the six months ended June 30, 2005.
"Our launch of Naglazyme is going very well and is exceeding our prior expectations," stated Jean-Jacques Bienaime, Chief Executive Officer of BioMarin. "As a result, we expect 2006 net product sales of Naglazyme to be about 30 percent greater than we had previously projected and our net loss for 2006 to be substantially lower as well." Mr. Bienaime continued, "With regard to our product pipeline, we remain on track to file a New Drug Application for Phenoptin for PKU at the end of the first quarter of 2007 and to announce data from the Phase 2 study of 6R-BH4 for the treatment of poorly controlled hypertension in early 2007."
Product Sales
Net sales of Naglazyme(TM) (galsulfase), an enzyme replacement therapy for mucopolysaccharidosis VI (MPS VI), for the second quarter of 2006 were $10.3 million and $17.3 million for the six months ended June 30, 2006. Naglazyme was approved by the U.S. Food and Drug Administration (FDA) on May 31, 2005, and by the European Commission in late January 2006. BioMarin is commercializing Naglazyme in the United States and Europe and through distributors in other international markets.
Net sales of Aldurazyme(R) (laronidase), an enzyme replacement therapy for mucopolysaccharidosis I, (MPS I) by BioMarin/Genzyme LLC increased 23 percent to $23.5 million for the second quarter of 2006, compared to $19.2 million in the second quarter of 2005. Net sales for the six months ended June 30, 2006 were $44.9 million, compared to $35.1 million for the same period in 2005, representing an increase of approximately 28 percent. BioMarin's share of the profit of BioMarin/Genzyme LLC was $4.7 million for the second quarter of 2006, compared to a profit of $3.3 million for the second quarter of 2005. BioMarin's share of the profit from BioMarin/Genzyme LLC for the six months ended June 30, 2006 was $8.5 million, compared to $5.4 million for the six months ended June 30, 2005.
Royalty and License Revenues
Royalty and license revenues for the second quarter and six months of 2006 were $9.4 million and $9.7 million, respectively, and include receipt of a one-time milestone payment of $7.5 million from Alliant Pharmaceuticals, following FDA approval of Orapred ODT(TM) (prednisolone sodium phosphate orally disintegrating tablets), amortization of the $2.5 million upfront license payment received from Alliant in March 2006, and royalties on net product sales of the Orapred product line, including Orapred(R) (prednisolone sodium phosphate oral solution) and authorized generic products. Pursuant to a licensing and acquisition agreement entered into with Alliant Pharmaceuticals on March 15, 2006, BioMarin will receive additional milestone payments contingent on the launch of Orapred ODT, which is expected to occur in early September of 2006, and on the first anniversary of FDA-approval of Orapred ODT in June 2007.
As of June 30, 2006 BioMarin had cash, cash equivalents and short-term investments totaling $305.9 million.
Financial Guidance 2006 Projected Net Product Sales
BioMarin has updated its net sales guidance for Naglazyme for the fiscal year ending December 31, 2006. BioMarin estimates 2006 net sales of Naglazyme to be in the range of $40 million to $44 million, compared to the previously estimated range of $31 million to $34 million.
BioMarin and Genzyme Corporation reconfirm estimated sales of Aldurazyme through the joint venture for 2006 to be in a range of $90 million to $100 million.
2006 Projected Net Loss
BioMarin has improved its estimated GAAP net loss for the fiscal year ending December 31, 2006 from a range of $42 million to $45 million to a range of $33 million to $37 million, which includes $8.4 million of expenses related to the 2004 acquisition of Orapred and $8.3 million of stock compensation expense.
Recent Events and Second Quarter 2006 Highlights
-- On July 6, BioMarin announced that it had initiated a Phase 2 clinical
study of 6R-BH4 for the treatment of poorly controlled hypertension.
The company expects to announce data from this trial in early 2007.
-- On June 1, BioMarin and Alliant Pharmaceuticals announced that the FDA
had granted marketing approval for Orapred ODT, the first orally
disintegrating tablet form of prednisolone available in the United
States. Alliant expects to begin marketing Orapred ODT in the United
States in early September.
Presentations at Upcoming Scientific Conferences
Researchers will present data pertaining to BioMarin's marketed products and clinical-stage programs, namely Phenoptin(TM) (sapropterin dihydrochloride) for the treatment of phenylketonuria (PKU) and 6R-BH4 for the treatment of cardiovascular indications, at the scientific conferences listed below:
-- Tetrahydrobiopterin and Alternative Treatments for Phenylketonuria,
Cardiovascular Diseases and Diabetes
Satellite Meeting to the 2006 International Congress on Inborn Errors
of Metabolism
September 10 - 11, 2006, Sendai, Japan
http://www.pku-bh4.com/
-- 10th International Congress of Inborn Errors of Metabolism
September 12 - 16, 2006, Chiba, Japan
http://www.iciem2006.org/
-- 56th Annual Meeting of the American Society of Human Genetics
October 9 - 13, 2006, New Orleans, Louisiana
http://www.ashg.org/
BioMarin will host a conference call and webcast to discuss second quarter financial results today, Wednesday, August 2, at 5:00 p.m. EDT (23:00 CEST). This event can be accessed on the investor section of the BioMarin website at www.BMRN.com .
Date: August 2, 2006 Time: 5:00 p.m. EDT (23:00 CEST) U.S. & Canada Toll-free Dial in #: 866-271-0675 International Dial in #: 617-213-8892 Participant Code: 93530506 Replay Toll-free Dial in #: 888-286-8010 Replay International Dial in #: 617-801-6888 Replay Code: 52624487 About BioMarin
BioMarin develops and commercializes innovative biopharmaceuticals for serious diseases and medical conditions. The company's product portfolio is comprised of two approved products and multiple clinical and preclinical product candidates. Approved products include Naglazyme(TM) (galsulfase) for mucopolysaccharidosis VI (MPS VI), a product wholly developed and commercialized by BioMarin, and Aldurazyme(R) (laronidase) for mucopolysaccharidosis I (MPS I), a product which BioMarin developed through a 50/50 joint venture with Genzyme Corporation. Investigational product candidates include Phenoptin(TM) (sapropterin dihydrochloride), a Phase 3 product candidate for the treatment of phenylketonuria (PKU), and 6R-BH4 for cardiovascular indications, which is currently in Phase 2 clinical development for the treatment of poorly controlled hypertension. For additional information, please visit www.BMRN.com . Information on BioMarin's website is not incorporated by reference into this press release.
The websites indicated in this press release are provided by BioMarin as additional information for interested parties. With the exception of its own websites, BioMarin does not endorse any particular organization or the content contained on their website.
Forward-Looking Statement
This press release contains forward-looking statements about the business prospects of BioMarin Pharmaceutical Inc., including, without limitation, statements about: the sales expectations of BioMarin's product Naglazyme and BioMarin/Genzyme LLC's product Aldurazyme; Alliant Pharmaceuticals' commercialization of Orapred ODT; the financial performance of the BioMarin as a whole; the timing of BioMarin's clinical trials of Phenoptin and 6R-BH4 for other indications; the continued clinical development and commercialization of Aldurazyme, Naglazyme, Phenoptin, and 6R-BH4 for other indications; and actions by regulatory authorities, including actions related to Naglazyme, Phenoptin, and 6R-BH4 for other indications. These forward-looking statements are predictions and involve risks and uncertainties such that actual results may differ materially from these statements. These risks and uncertainties include, among others: our success in continuing commercialization of Naglazyme; our joint venture partner's success in continuing the commercialization of Aldurazyme; Alliant Pharmaceuticals' success in commercializing Orapred ODT; results and timing of current and planned preclinical studies and clinical trials, including the Phase 3 clinical trial of Phenoptin and 6R-BH4 for other indications; the content and timing of decisions by the U.S. Food and Drug Administration, the European Commission and other regulatory authorities concerning each of the described products and product candidates; the market for each of these products and particularly Aldurazyme, Naglazyme and Orapred; actual sales of Aldurazyme, Naglazyme and Orapred; product returns of Orapred; and those factors detailed in BioMarin's filings with the Securities and Exchange Commission, including, without limitation, the factors contained under the caption "Risk Factors" in BioMarin's 2005 Annual Report on Form 10-K, as amended, and the factors contained in BioMarin's reports on Form 8-K. Stockholders are urged not to place undue reliance on forward-looking statements, which speak only as of the date hereof. BioMarin is under no obligation, and expressly disclaims any obligation to update or alter any forward-looking statement, whether as a result of new information, future events or otherwise.
NOTE: Aldurazyme(R) is a registered trademark of BioMarin/Genzyme LLC.
NOTE: Orapred(R) is a registered trademark of Medicis Pediatrics, Inc. and is used under license.
Contacts:
Investors Media
Joshua A. Grass Susan Ferris
BioMarin Pharmaceutical Inc. BioMarin Pharmaceutical Inc.
415-506-6777 415-506-6701
Net Product Sales of BioMarin Pharmaceutical Inc. and BioMarin/Genzyme LLC
For the Three and Six Months Ended June 30, 2005 and 2006
(In millions, except per share data, unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2005 2006 2005 2006
Aldurazyme (as reported by
BioMarin/Genzyme LLC) (1) $19.2 $23.5 $35.1 $44.9
Naglazyme 0.1 10.3 0.1 17.3
Orapred (2) 1.3 (0.6) 6.3 1.3
(1) The Company recognizes its 50% share of the net income of
BioMarin/Genzyme LLC as Equity in the income of BioMarin/Genzyme LLC in
the Company's consolidated statements of operations.
(2) For the three months ended June 30, 2006, the Company recognized net
Orapred product return expense of $0.6 million.
BIOMARIN PHARMACEUTICAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Six Months Ended, June 30, 2005 and 2006
(In thousands, except for per share data, unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2005 2006 2005 2006
Revenues:
Net product sales $1,437 $9,657 $6,426 $18,636
Collaborative
agreement revenues 2,189 4,435 2,189 8,949
Royalty and license
revenues -- 9,358 -- 9,677
Total revenues 3,626 23,450 8,615 37,262
Operating expenses:
Cost of sales
(excludes amortization
of developed product
technology) 478 789 1,137 2,512
Research and
development 14,822 15,779 29,814 28,058
Selling, general
and administrative 10,117 11,871 20,684 22,767
Amortization of
acquired intangible
assets 286 1,093 572 1,466
Total operating
expenses 25,703 29,532 52,207 54,803
Equity in the
income of
BioMarin/Genzyme LLC 3,303 4,745 5,378 8,545
Loss from operations (18,774) (1,337) (38,214) (8,996)
Interest income 374 4,034 615 4,736
Interest expense (2,940) (4,022) (6,199) (6,846)
Net loss $(21,340) $(1,325) $(43,798) $(11,106)
Net loss per share,
basic and diluted $(0.33) $(0.02) $(0.68) $(0.14)
Weighted average
common shares
outstanding, basic
and diluted 64,605 85,341 64,558 80,181
BIOMARIN PHARMACEUTICAL INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except for share and per share data)
December 31, June 30,
2005 (1) 2006
(unaudited)
ASSETS
Current assets
Cash and cash equivalents $38,092 $285,990
Short-term investments 9,700 19,910
Accounts receivable, net 5,860 10,946
Advances to BioMarin/Genzyme LLC 1,071 926
Inventory 10,898 24,247
Other current assets 3,320 2,788
Total current assets 68,941 344,807
Cash balances related to long-term debt 17,049 --
Investment in BioMarin/Genzyme LLC 31,983 28,528
Property and equipment, net 37,321 51,615
Acquired intangible assets, net 15,306 13,841
Goodwill 21,262 21,262
Other assets 3,441 8,661
Total assets $195,303 $468,714
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities $20,934 $23,073
Current portion of acquisition obligation,
net of discount 7,477 6,705
Current portion of deferred revenue 8,096 8,226
Current portion of equipment and
facility loans 3,860 --
Total current liabilities 40,367 38,004
Convertible debt 125,000 297,500
Long-term portion of acquisition obligation,
net of discount 70,873 69,811
Deferred revenue, net of current portion 11,825 7,990
Equipment and facility loan, net of current portion 17,049 --
Other long-term liabilities 7,651 6,522
Total liabilities 272,765 419,827
Stockholders' equity (deficit):
Common stock, $0.001 par value: 150,000,000 shares
authorized; 74,301,610 and 85,470,948 shares issued
and outstanding at December 31, 2005 and
June 30, 2006, respectively 75 85
Additional paid-in capital 485,570 623,048
Accumulated other comprehensive loss (16) (49)
Accumulated deficit (563,091) (574,197)
Total stockholders' equity (deficit) (77,462) 48,887
Total liabilities and stockholders'
equity (deficit) $195,303 $468,714
(1) December 31, 2005 balances were derived from the audited consolidated
financial statements.
SOURCE: BioMarin Pharmaceutical Inc.
CONTACT: investors, Joshua A. Grass, +1-415-506-6777, or media, Susan
Ferris, +1-415-506-6701, both of BioMarin Pharmaceutical Inc.
Web site: http://www.bmrn.com/