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Neurocrine Biosciences, Inc. (NBIX)
Q1 2013 Earnings Conference Call
May 2, 2013 05:00 PM ET
Kevin Gorman - President and CEO
Jane Sorensen - IR
Tim Coughlin - VP and CFO
Chris O’Brien - SVP and CMO
Sara Slifka - Morgan Stanley
Irene Lau - Leerink Swann
Yale Jen - Roth Capital
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It’s now my pleasure to turn the conference over to Kevin Gorman. Please go ahead. Please stand by while we await our speaker.
Thank you very much, and we apologize for the slight glitch when the call started. Thank you all for joining us today. I am here with Tim Coughlin, our CFO and Chris O’Brien, our Chief Medical Officer. Today we are going to walk you through the financials for the first quarter and give you an update on our R&D programs. But First Jane, could you please read our Safe Harbor statement.
Yes. Good afternoon. I want to remind you of Neurocrine’s Safe Harbor cautions. Certain statements made in the course of this conference call that state the Company’s or management’s intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements, which are subject to risks and uncertainties.
Information concerning factors that could cause actual results to differ materially from those contained in or implied by the forward-looking statements is contained in the Company’s SEC filings, including but not limited to the Company’s Annual Report on Form 10-K and quarterly reports on Form 10-Q. Copies of these filings may be obtained by visiting the Investor Relations page on the Company’s website at neurocrine.com. Any forward-looking statements are made only as of today’s date and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. Kevin?
Thank you, Jane. Tim, we will start with you.
Sure. Thanks Kevin and good afternoon to everyone. Today we released our financial results for the first quarter 2013. Our net loss for the quarter was $0.18 per share, compared to the loss during the first quarter of 2012 of $0.01 per share. The main drivers of this difference in operating results were a decrease in collaboration revenue under both the AbbVie and Boehringer Ingelheim license agreements. The collaboration portion of both these agreements ended as planned during 2012. We remain on target for an annualized cash flow of $50 million to $55 million consistent with the guidance provided at the beginning of the year.
We ended the first quarter of 2013 with approximately 177 million in cash and investments and receivables. Revenue for the quarter was approximately $700,000. We expect revenue to remain at this level for the balance of the year. Recall we are not expecting any milestones in 2013 under existing collaboration agreements. This milestone is anticipated to resume in 2014.
Research and development expense increased in first quarter over the first quarter of 2013 over the first quarter of 2012 and for the last quarter of 2012 to this quarter. The main driver of this increase is the Phase IIb activity in our VMAT2 program. We expect R&D expense to continue to increase into the second quarter of 2013. General and administrative expenses decreased year over year and was flat from the fourth quarter of last year to the first quarter of this year.
The decrease in G&A expense year over year was primarily due to continuing cost containment efforts and we expect G&A expense to be at this approximate $3.4 million level for the remaining three quarters of the year.
Our financial guidance for the year remains unchanged. We expect approximately $3 million in revenue from upfront license fee amortization and expenses for 2013 should approximate $55 million to $60 million. Our net loss for 2013 is expected to be $50 million to $55 million. We expect to end 2013 with in excess $130 million in cash investments and receivables. Last thing I want to mention is our 10-Q will be on file today with the SEC for anybody looking for additional details.
Now with that I will turn it back to Kevin for the balance of the call.
Thanks Tim. Prior to turning it over to Chris, I would like to give an overview of our two main programs. The first AbbVie has made significant progress with Elagolix. Earlier this quarter AbbVie achieved proof of concept in the large Phase IIa trial studying uterine fibroids and based on this result they moved the compound rapidly into a six month Phase IIb study of approximately 280 women with uterine fibroids.
They stated that this study will complete in the second half of 2014 and if positive they will move into Phase III by the end of 2014. Now they are also track with the Phase III endometriosis study. My understanding is they are very pleased with the conduct of that study today and continue to anticipate top line data in Q1 in next year. We are fortunate to have AbbVie as a partner they are improving their expertise and their dedication to this program.
Now changing over to our VMAT2 program, that is also progressing well. We are very pleased with the conduct of each of the trials, and Chris will go into more detail on that in a moment. Enrollment of these studies started out slower than we had anticipated as we developed learnings of how to reach these patients. We are enrolling well in both trials, and at this rate that we have, we will have top line data for Kinect in Q3 with Kinect 2 reading out shortly thereafter.