United Therapeutics Corporation (Nasdaq: UTHR) today announced its results of operations for the quarter ended March 31, 2010.
Total revenues for the first quarter of 2010 were $128.9 million, up from $79.7 million for the first quarter of 2009. Net income for the first quarter of 2010 was $18.9 million or $0.35 per basic share, compared to $13.2 million, or $0.25 per basic share, for the first quarter of 2009. Gross margin from sales was $113.7 million for the first quarter of 2010, compared to $70.4 million for the first quarter of 2009. Earnings before non-cash charges, a non-GAAP financial measure defined as net income before income taxes, non-cash interest, non-cash license fee expenses, depreciation, amortization, impairment charges and share-based compensation (stock option and share tracking award expense), was $68.1 million for the first quarter of 2010, compared to $38.5 million for the first quarter of 2009.
"We begin this year impressively, with continued strong growth in revenues and operating results, which are primarily due to increased use of Remodulin and Tyvaso," said Martine Rothblatt, Ph.D., United Therapeutics' Chairman and Chief Executive Officer. "As we look ahead, I am encouraged about our prospects to achieve a ninth straight year of greater than 30% revenue growth."
Financial Results for the Three Months Ended March 31, 2010
The following table sets forth the components of net revenues (in thousands):
The growth in revenues for the three months ended March 31, 2010, corresponds in large part to: (i) a continued increase in the number of patients being prescribed Remodulin; and (ii) sales of Tyvaso and Adcirca, which were commercially launched in the third quarter of 2009.
Research and Development Expense
The table below summarizes research and development expense by major project and non-project component (dollars in thousands):ardiovascular. The increase in cardiovascular program expenses relates to our amended FREEDOM-M and FREEDOM-C2 clinical trials and to our development of beraprost-MR.
Share-based compensation. The increase in share-based compensation reflects the increase in compensation expense recognized in connection with outstanding awards granted under our Share Tracking Awards Plan (STAP), primarily as a result of the increase in the price of our common stock over the three months ended March 31, 2010.
Selling, General and Administrative Expense
The table below summarizes selling, general and administrative expense by major category (dollars in thousands):
General and administrative. The increase in general and administrative expenses reflects: (i) an increase in operating-related expenses due to the growth of our business; (ii) an increase in depreciation expense incurred in connection with our recently-constructed facilities in North Carolina and Maryland; and (iii) increases in legal and professional fees related to ongoing litigation and prospective transactions.
Sales and marketing. The increase in sales and marketing expenses corresponds primarily to expenses incurred related to marketing our new products, Tyvaso and Adcirca.
Share-based compensation. The increase in share-based compensation expense is attributable to increases in expenses recognized in connection with outstanding awards granted under our STAP and a potential year-end stock option grant to our Chief Executive Officer, which is based on a formula set forth in her employment agreement, both reflecting the increase in the price of our common stock over the three months ended March 31, 2010.
Earnings before Non-Cash Charges
The following table provides a reconciliation of net income to earnings before non-cash charges for each of the three-month periods ended March 31, 2010 and 2009 (in thousands, except per share data):
SOURCE United Therapeutics Corporation