) reported third quarter 2012 earnings of $1.17 per American
Depository Receipt (ADR), up 40.9% from the prior-year earnings
of 83 cents. Results benefited from currency movements. Earnings
were above the Zacks Consensus Estimate of 72 cents.
For the nine months ended September 30, adjusted earnings were
$3.46 per ADR compared with a loss of $2.19 in the year-ago
period. The prior-year period results included a litigation
provision related to the Asahi Kasei lawsuit.
We note that all growth rates below are in local currency and
represent growth over the prior-year period.
Product sales through the first nine months of 2012 were down
3%. Results were hurt by a weak performance in the US due to
excessive competition for Tracleer. On a regional basis, 42% of
product revenues came from the US, 37% from Europe, 11% from
Japan and the balance from the rest of the world.
We note that Actelion has three marketed products, Tracleer,
Ventavis and Veletri, for the treatment of pulmonary arterial
hypertension (PAH). Another drug, Zavesca is indicated for the
treatment of Gaucher's disease. Zavesca is also approved in the
EU for treating adults suffering from progressive neurological
manifestations patients and children suffering from Niemann-Pick
type C disease (NP-C). Zavesca (brand name: Brazaves) was
launched this year for the NP-C indication in Japan.
Tracleer revenues were down 4% in the nine months mainly due
to excessive competition in the US. Ventavis sales were down 3%
from the prior year. The decline was attributable to lower units
Veletri, launched in 2010, did very well during the period
with sales soaring 53%. We remind investors that in June this
year, the second-generation formulation of Veletri was approved
in the US. Actelion expects to launch the new formulation of the
product in the EU and Japan next year.
Zavesca sales were up 22%. Strong sales of the drug in the
NP-C indication in Europe contributed to the impressive
Adjusted research & development expenses (R&D)
declined 1%. Adjusted selling, general and administrative
expenses were down 9%.
Actelion is expected to present data from a phase III
long-term outcome study of macitentan on October 23, 2012. The
study is evaluating the candidate in patients suffering from
The company also progressed well with selexipag, which is in
the phase III GRIPHON (Prostacyclin PGI2 Receptor agonist in
pulmonary arterial hypertension) study. Actelion is expecting
results from the study in mid-2014.
Actelion maintained its 2012 core earnings growth guidance in
mid single digits. The company expects product sales to decrease
in the low single-digit percentage range.
Actelion also provided its earnings growth guidance for 2013,
2014 and 2015. For 2013, the company expects earnings to remain
flat, whereas in the next two years earnings are expected to see
a single-digit percentage and double-digit percentage growth,
Actelion, which competes with players such as
) in the PAH space, carries a Zacks #2 Rank (But) in the short
We remind investors that in September this year, the company
implemented a cost saving initiative, which was initially
announced by the company in July 2012. In relation to the
cost-cutting move, Actelion further reduced redundancies by 30
positions from the initial projection of up to 70 redundancies at
its head office, thereby minimizing job losses.
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