) reported a loss of 1 cent per share (including stock-based
compensation expense) in the second quarter of 2014 which compared
unfavorably with the Zacks Consensus Estimate of earnings of 4
cents and the year-ago earnings of 23 cents per share. Higher
costs hurt results in the second quarter of 2014.
Total revenues climbed 10.7% to $153.4 million, above the Zacks
Consensus Estimate of $148 million. Manufacturing and royalty
revenues at Alkermes climbed 8.8% to $130.4 million in the quarter
leading to the top-line beat. Manufacturing and royalty revenues
included $60 million (up 7%) from the company's long-acting
atypical antipsychotic franchise, Risperdal Consta and Invega
Sustenna/Xeplion. The drugs are marketed by Johnson & Johnson (
Alkermes recorded manufacturing and royalty revenues of $19.5
million (down 2%) from Ampyra (EU trade name: Fampyra). Alkermes
earned royalty revenues of $8.8 million from type II diabetes
treatment Bydureon compared with $5.4 million in the year-ago
Alkermes also earned revenues from Emend ($5.1 million) and Ritalin
LA/Focalin XR franchise ($10.9 million) and Verelan ($6.6 million).
Vivitrol sales, a legacy Alkermes product, climbed 24.2% to $21.6
million in the reported quarter. Research and development revenues
accounted for the balance.
Reported total expenses were $176.2 million, up from the year-ago
figure of $125.1 million. Research & development (R&D)
expenses more than doubled to $67.2 million in the reported
quarter. The increase was attributable to Alkermes' efforts to
develop its pipeline. Costs associated with the anticipated launch
of schizophrenia candidate aripiprazole lauroxil also led to the
increase. Alkermes intends to seek U.S. approval of the
schizophrenia candidate by Sep 30, 2014. The approval would boost
Alkermes' top line since the schizophrenia market offers
significant commercial potential. Alkermes is also evaluating a
once every two months dosing regimen for aripiprazole lauroxil.
Alkermes still expects total revenues in the range of $580 million
to $610 million. Adjusted earnings per share are now projected in
the range of 19 cents to 32 cents (old guidance: 41 cents to 54
cents). The Zacks Consensus Estimate for 2014 indicates earnings of
17 cents per share on revenues of $598 million.
The company continues to expect selling, general and administrative
(SG&A) expenses in the range of $190 million to $200 million.
R&D expenses are now projected in the band of $260 million and
$280 million (old guidance: $225 million to $245 million). Alkermes
increased the R&D guidance since it is expediting and expanding
some clinical trials.
Alkermes, a biopharmaceutical company, carries a Zacks Rank #3
(Hold). Better-ranked biopharma stocks include Actelion (
) and Alexion Pharmaceuticals (
). While Actelion sports a Zacks Rank #1 (Strong Buy), Alexion is a
Zacks Ranked #2 (Buy) stock.
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