Cubist Pharmaceuticals Inc.
) fourth quarter 2011 earnings (excluding special items but
including stock-based compensation expense) of 58 cents per share
raced past the Zacks Consensus Estimate by 29 cents. Results in the
quarter were helped by strong sales of antibiotic injection,
Cubicin (daptomycin). Adjusted earnings surpassed the year-ago
adjusted earnings by 3 cents.
The fourth quarter in details
Revenue in the final quarter of 2011 climbed 31.6% to $212.9
million. Revenues beat the Zacks Consensus Estimate of $205.0
million. Cubicin, which is approved in the US and several other
markets for the treatment of severe bacterial infections of the
skin and bloodstream, accounted for the bulk of the revenues
reported in the quarter.
Net product sales in the US climbed 24.4% to $192.6 million.
Most of the US sales came from Cubicin. Net sales of the product in
the US climbed 22.8% to $190.1 million in the reported quarter.
Entereg, added to Cubist Pharma's portfolio following the
acquisition of Adolor Corporation in December 2011, accounted for
the remaining US sales. Entereg is marketed to expedite
gastrointestinal recovery following bowel resection surgery. Net
revenues from international sales of Cubicin jumped 71% to $10.8
million in the fourth quarter of 2011. Total Cubicin sales climbed
25% in the final quarter of 2011 to $200.9 million.
During the quarter, Cubist Pharma recognized $3.7 million as
service revenues pertaining to its two-year agreement with
Optimer Pharmaceuticals Inc.
) for the co-promotion of Optimer's Dificid (fidaxomicin) in the
US. The drug, developed by Optimer, is approved for treating
patients suffering from clostridium difficile-associated diarrhea .
Dificid is available in US markets since July 2011. Cubist Pharma
recorded $5.7 million as other revenues in the final quarter of
Cubist Pharma earned (excluding special items but including
stock-based compensation expense) $2.36 per share in 2011 as
opposed to approximately $2.46 in 2010. Earnings were well above
the Zacks Consensus Estimate of 74 cents.
Total net revenues at Cubist Pharma climbed 18% to $754.0
million driven by strong Cubicin sales. Revenues in 2011 surpassed
the Zacks Consensus Estimate of $746.0 million. Cubicin sales
climbed 18% in 2011 to $735.5 million. The drug fared well in the
US (up 16.6% to $698.8 million) as well as internationally (up 45%
to $36.7 million).
Apart from announcing the financial results, Cubist Pharma also
gave guidance for 2012. The biopharmaceutical company expects to
end 2012 with revenues in the range of $880 - $910 million, driven
by strong sales of Cubicin in the US. The Zacks Consensus Estimate
is below the guidance range provided by the company and currently
stands at $873 million.
Net US sales of Cubicin are expected in the range of $770 - $795
million. International Cubicin sales for 2012 are projected to be
approximately $45 million. Net sales of Entereg in the US are
expected in the range of $40 - $45 million. Service revenues and
other revenues are expected to add up to $25 million in 2012.
Research and development costs for 2012 are projected in the
range of $285 and $295 million in 2012 ($184.5 million in 2011).
The increase is primarily due to Cubist Pharma's efforts to develop
its pipeline. Selling, general and administrative expenses in 2012
are expected in the range of $165-$175 million ($163.2 million in
2011). Adjusted operating income is forecasted in the range of $245
- $250 million for 2012.
Currently we have an Underperform recommendation on Cubist
Pharma. The stock carries a Zacks #3 Rank (Hold rating) in the
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