Biogen Idec first quarter revenues increase 7% to $1.3 billion

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May 2 2012Biogen Idec

Biogen Idec Inc. (NASDAQ: BIIB), a global biotechnology leader in the discovery, development, manufacturing and commercialization of innovative therapies, today announced its first quarter 2012 results.

“non-GAAP net income attributable to Biogen Idec Inc.”

First Quarter 2012 Highlights:

First quarter revenues increased 7% to $1.3 billion, compared to the first quarter of 2011. TYSABRI^®(natalizumab) revenues increased 14% year-over-year to $286 million. AVONEX^®(interferon beta-1a) revenues increased 3% year-over-year to $662 million, while worldwide unit demand for AVONEX decreased 4% year-over-year primarily due to unfavorable distribution channel dynamics. RITUXAN^® (rituximab) revenues from our unconsolidated joint business arrangement were $285 million for the quarter, an increase of 11% year-over-year.
Global in-market sales of TYSABRI in the first quarter of 2012 were $399 million, an increase of 14% over the first quarter of 2011. The total was comprised of $201 million in U.S. sales and $198 million in sales outside the U.S.
First quarter 2012 GAAP diluted EPS were $1.25, an increase of 4% over the first quarter of 2011. GAAP net income attributable to Biogen Idec for the quarter was $303 million, an increase of 3% from the first quarter of 2011.
Non-GAAP diluted EPS for the first quarter of 2012 were $1.40, a decrease of 2% over the first quarter of 2011. Non-GAAP net income attributable to Biogen Idec for the first quarter of 2012 was $338 million, a decrease of approximately 3% from the first quarter of 2011.

As of March 31, 2012, Biogen Idec had cash, cash equivalents and marketable securities of approximately $2.7 billion.

The company also announced today that it expects to repurchase an additional $500 million in shares over the balance of the year for the purpose of retiring shares and returning capital to shareholders.

"Our revenue growth in the first quarter reflects our strong business fundamentals," said George A. Scangos, Ph.D., the company's chief executive officer. "While AVONEX orders in January were impacted by what we believe to be isolated events, sales rebounded quickly and we believe the underlying AVONEX business is solid. TYSABRI and RITUXAN generated double-digit sales growth. We filed for marketing approval for our oral MS candidate BG-12 in both the U.S. and Europe and continued to ramp up R&D activity as we executed on six phase III programs and advanced our early-stage pipeline. We're optimistic about our business outlook for the year."

TYSABRI Patient Growth

Based upon data available to us through the TOUCH^® prescribing program and other third-party sources, as of the end of March 2012, we estimate that approximately 66,600 patients were on commercial and clinical TYSABRI therapy worldwide, and that cumulatively approximately 99,600 patients have ever been treated with TYSABRI in the post-marketing setting.

Investing for the Future

The company is preparing for the potential of multiple product launches in the coming years. With the expectation of an early 2013 launch for BG-12 (dimethyl fumarate) in the U.S. and 2013 launches in hemophilia, it continued to make investments in the first quarter in product positioning and promotional planning, scientific outreach, shaping its patient support services, and supply chain.

The company also made significant headway on its R&D pipeline. It anticipates phase III data readouts in the second half of the year from its long-lasting factor VIII and long-lasting factor IX programs for hemophilia and dexpramipexole for amyotrophic lateral sclerosis (ALS). Its partner Isis Pharmaceuticals began dosing patients in a phase I study for ISIS-SMN_Rx for the treatment of spinal muscular atrophy (SMA), the most common genetic cause of infant mortality, and the companies expect results in late 2013. Through the recent acquisition of Stromedix, Biogen Idec added STX-100, a novel humanized monoclonal antibody that is expected to initiate a phase II study by mid-year in idiopathic pulmonary fibrosis (IPF), a debilitating and almost uniformly fatal disease in which patients experience progressive difficulty breathing due to scarring of the lung.

Other Products and Royalties

Revenues from other products in the first quarter of 2012 were $28 million, compared to $13 million in the first quarter of 2011.

Royalties were $29 million in the first quarter of 2012, an increase of 13% compared to the first quarter of 2011.

For the first quarter of 2012, corporate partner revenues were $3 million, compared to $15 million in the first quarter of 2011.

Updated 2012 Financial Guidance

Biogen Idec also updated its full year 2012 financial guidance. This guidance consists of the following components:

Revenue growth is expected to be in the mid-single digits versus 2011.
Cost of Sales is expected to be approximately 9% to 10% of total revenue.
R&D expense is expected to be approximately 24% to 25% of total revenue.
SG&A expense is expected to be approximately 22% to 23% of total revenue.
Tax expense is expected to be approximately 24% to 25% of pretax income.
Non-GAAP diluted EPS is expected to be above $6.15.
GAAP diluted EPS is expected to be above $5.54.
Capital expenditures are expected to be in the range of $230 to $250 million.

Biogen Idec may incur charges, realize gains or experience other events in 2012 that could cause actual results to vary from this guidance.

Recent Events

As of last week, the AVONEX PEN^® became commercially available in the U.S. The first intramuscular autoinjector for multiple sclerosis (MS), the AVONEX PEN uses a smaller needle and hides the needle from sight, helping reduce patients' anxieties about injecting themselves.
At the American Academy of Neurology Annual Meeting (April 21-28, 2012), Biogen Idec featured 49 company-sponsored platform and poster presentations that demonstrate how the company is pursuing treatments for neurological diseases with high unmet need. In addition to presenting data from three marketed products in MS - TYSABRI, AVONEX and FAMPYRA^®(prolonged-release fampridine tablets) - the company presented results from investigational trials of its late-stage pipeline, including: BG-12, PEGylated interferon beta-1a, and daclizumab high-yield process (DAC HYP) for MS; and dexpramipexole, a potential treatment for ALS.
On February 28, 2012, Biogen Idec announced the company submitted a New Drug Application to the U.S. Food and Drug Administration (FDA) for marketing approval of BG-12, the company's oral therapeutic candidate for the treatment of MS. The regulatory submission was based on BG-12's comprehensive development program, in which BG-12 demonstrated significant reductions in MS disease activity coupled with favorable safety and tolerability in the phase III DEFINE and CONFIRM studies. Biogen Idec also submitted a Marketing Authorisation Application to the European Medicines Agency for marketing approval of BG-12 in March 2012.
On February 28, 2012, Biogen Idec announced that the FDA approved two separate dosing innovations designed to improve the treatment experience for patients receiving once-a-week AVONEX for relapsing forms of MS: the AVONEX PEN and AVOSTARTGRIP^TM. The AVOSTARTGRIP is a new dose titration regimen, which gradually escalates the dose of AVONEX at treatment initiation and reduces the incidence and severity of flu-like symptoms that can occur at the beginning of therapy.
On February 14, 2012, Biogen Idec announced that it entered into a definitive agreement to acquire Stromedix, a privately held biotechnology company focused on innovative therapies for fibrosis and organ failure. The acquisition was completed on March 8, 2012. Stromedix's lead candidate, STX-100, is expected to enter a phase II trial in patients with IPF by mid-year. More than 200,000 patients in the United States and Europe have IPF, and there is no FDA-approved treatment for the disease at this time.
On January 26, 2012, Biogen Idec and Elan Corporation announced a global phase IIIb study, ASCEND, that is being conducted to evaluate the effectiveness of TYSABRI as a treatment for secondary-progressive multiple sclerosis (SPMS). According to the National Multiple Sclerosis Society, approximately half of all people initially diagnosed with relapsing-remitting MS - the most common form of MS - will transition to SPMS within 19 years.
On January 20, 2012, Biogen Idec and Elan Corporation announced the FDA approved a product label change for TYSABRI that will help enable individual benefit risk assessment for patients with MS. The new label identifies anti-JCV antibody status as a risk factor for developing an infrequent but serious brain infection known as progressive multifocal leukoencephalopathy. This marks the third risk factor identified to help physicians and people with MS make personalized treatment decisions when considering TYSABRI, a highly effective treatment for relapsing forms of MS.
On January 4, 2012, Biogen Idec and Isis Pharmaceuticals announced they entered into an exclusive, worldwide option and collaboration agreement under which the companies will develop and commercialize Isis' antisense investigational drug, ISIS-SMN_Rx, for the treatment of SMA. Biogen Idec has the option to develop and commercialize this compound for the most common genetic cause of infant mortality and will offer its expertise in neurology to aid in rapid development.