Revenues Rise at Alkermes - Analyst Blog


Alkermes plc ( ALKS ) reported earnings of 3 cents per share (including depreciation and stock-based compensation expenses) in the second quarter of fiscal 2013 (ended September 30, 2012). The Zacks Consensus Estimate was 7 cents per share.

This was the fourth full quarter following the purchase of Elan Corporation 's ( ELN ) drug delivery unit, Elan Drug Technologies (EDT). We remind investors that Alkermes purchased the EDT unit in September 2011.

Alkermes suffered a loss of 14 cents per share in the year-ago quarter. However, results of the year-ago quarter included 14 days results of Elan's EDT unit. The company, prior to the purchase of the EDT unit, was headquartered in Cambridge, Massachusetts. However, the company shifted its base to Dublin, Ireland, post merger.

Quarterly Results

Total revenue for the second quarter of fiscal 2013 jumped 72% to $124 million. The massive jump was attributable to the 98.6% rise in manufacturing and royalty revenues due to the expanded product portfolio following the purchase of the EDT unit. Revenues surpassed the Zacks Consensus Estimate of $121.0 million.

In the reported quarter, Alkermes recorded $50.3 million as manufacturing and royalty revenues from its long-acting atypical antipsychotic franchise comprising Risperdal Consta and Invega Sustenna/Xeplion. These schizophrenia drugs are marketed by Johnson & Johnson ( JNJ ). Alkermes recorded manufacturing and royalty revenues of $5 million in the reported quarter from Ampyra/Fampyra.. Ampyra/Fampyra is marketed for improving walking ability in multiple sclerosis patients.

Alkermes earned $3.3 million in royalty revenues from type II diabetes treatment Bydureon. Alkermes co-promotes the drug with Amylin Pharmaceuticals (now a wholly owned subsidiary of  Bristol-Myers Squibb Company ( BMY )).

Vivitrol, a legacy Alkermes product, performed well in the second quarter of fiscal 2013. Sales of the product climbed approximately 53.5% year over year to $15.2 million.

During the quarter, Alkermes also earned revenues from its legacy products; Tricor 145 ($12.5 million) and Ritalan LA/Focalin XR franchise ($9.1 million).

Research and development (R&D) revenue from collaborations came in at $1.6 million in the second quarter of fiscal 2013 as opposed to $8 million a year ago. R&D revenues in the year ago quarter were boosted by a $7 million milestone payment pertaining to the launch of Bydureon in the EU in July 2011.

Total expenses at Alkermes (excluding non-cash charges of $29.3 million) were $89.3 million in the second quarter of fiscal 2013. Total expenses were $81.8 million (excluding amortization of acquired intangible assets) in the year-ago quarter.

Fiscal 2013 Projection Upped

Alkermes upped its outlook for fiscal 2013. The company now expects revenues in the range of $510 million to $540 million (previous guidance: $490-$530 million). We expect Alkermes to achieve the guidance given its expanded product portfolio. Consequently, the Zacks Consensus Estimate of $518 million is well within the company's guidance range.

Alkermes also upped its projection for adjusted earnings in fiscal 2013. Adjusted earnings are now expected in the range of 88 cents-$1.04 (previous guidance: 69 - 84 cents per share). The Zacks Consensus Estimate is 65 cents per share for fiscal 2013.

ALKERMES INC (ALKS): Free Stock Analysis Report

BRISTOL-MYERS (BMY): Free Stock Analysis Report

ELAN CP PLC ADR (ELN): Free Stock Analysis Report

JOHNSON & JOHNS (JNJ): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: ALKS , BMY , EDT , ELN , JNJ

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