Eurand Reports Key Achievements and Strong Revenue Growth for Third Quarter 2009 AMSTERDAM, THE NETHERLANDS--(Marketwire - 11/05/09) - Eurand N.V. (NASDAQ:EURX - News) Key Achievements:
-- Received U.S. Food and Drug Administration (FDA) approval for lead
proprietary product ZENPEP(TM) (pancrelipase) Delayed-Release Capsules, a
pancreatic enzyme product (PEP) for the treatment of exocrine pancreatic
insufficiency (EPI) due to cystic fibrosis (CF) or other conditions; launch
is expected to commence by the end of November 2009
-- Grew third quarter 2009 revenues 25%, or 19% at constant currency
rates, to EUR 30.6 million ($44.8 million) compared with the same period in
2008
-- Continued to grow revenues from Pancrelipase, Eurand's unbranded PEP,
which held 21.2% of all prescriptions for coated PEPs for the week ended
October 23, 2009, according to IMS Health Incorporated
-- Increased total cash, cash equivalents and marketable securities to
EUR 31.3 million ($45.8 million) at September 30, 2009, up EUR 8.6 million
($12.5 million) from December 31, 2008
-- On October 27th, 2009, completed a public offering of 9,775,000
ordinary shares at $11.25 per share, including 2,000,000 newly issued
shares and exercise of over-allotment option of 1,275,000 shares. The net
proceeds of approximately $20.6 million from the sale of the newly issued
shares will add substantially to the Company's cash reserves.
Eurand N.V. (NASDAQ:EURX - News), a global specialty pharmaceutical company, today reported revenues of EUR 30.6 million ($44.8 million) for the three months ended September 30, 2009, an increase of 25%, or 19% percent at constant currency rates, from the third quarter of 2008. The increase in revenues for the 2009 third quarter was led by strong sales of Eurand's unbranded pancreatic enzyme product, Pancrelipase, currently the second-most prescribed coated PEP with a 21.2% share of total prescriptions dispensed through October 23, 2009. Also contributing to the strong quarterly performance was continued growth in sales of partnered products, in particular ULTRASE® by Axcan and AMRIX® by Cephalon. "Eurand had another excellent quarter, highlighted by the FDA approval of our first proprietary product, ZENPEP, as well as continued strong revenue growth and positive cash flow," said Gearóid Faherty, Chairman and Chief Executive Officer. "We eagerly await the upcoming launch of ZENPEP, which we believe lays the foundation for our long-term growth and profitability." He noted that Eurand is completing pre-launch preparations, including training its sales organization, finalizing marketing and promotional materials, and preparing launch stock for shipment. "We continue to perform well across all areas of our business," Faherty added. "We believe that with the upcoming launch of ZENPEP, the ongoing launch of LAMICTAL® ODT(TM) by our partner GlaxoSmithKline and the continued success of our other partnered products, we are well positioned to sustain the strong revenue growth we have achieved year to date in 2009." RECENT CORPORATE DEVELOPMENT On October 27, 2009, Eurand completed a public offering of 9,775,000 ordinary shares, including over-allotments, at $11.25 per share. The Company intends to use the net proceeds of approximately $20.6 million from the issuance and sale of its 2,000,000 ordinary shares to fund potential product acquisitions and/or potential acquisitions of complementary businesses and research and development of additional product candidates, as well as other general corporate purposes. The remaining 7,775,000 shares were sold by current stockholders, Warburg, Pincus Equity Partners, L.P. (including two affiliated partnerships) and Warburg, Pincus Ventures International, L.P. Chairman and Chief Executive Officer Gearóid Faherty, Eurand's second-largest shareholder, elected not to sell any shares in this offering. The shares were offered through an underwriting syndicate led by Deutsche Bank Securities and BofA Merrill Lynch, together with co-managers Cowen and Company and Thomas Weisel Partners LLC. PRODUCT DEVELOPMENT PIPELINE UPDATE: EUR-1008 - ZENPEP(TM) (pancrelipase) Delayed-Release Capsules
-- As announced on August 28, 2009, the FDA approved ZENPEP (EUR-1008)
for the treatment of exocrine pancreatic insufficiency due to cystic
fibrosis or other conditions. ZENPEP is the only FDA-approved pancreatic
enzyme product that has been evaluated in clinical studies in adults and
children -- including children from one to seven years old -- and will
offer four dosage strengths to meet the varied needs of infants, toddlers,
adolescents and adults with EPI. ZENPEP is the sixth Eurand-developed
product to be approved by the FDA since 2001 and the second this year
following the May 8th approval of LAMICTAL® ODT(TM) (lamotrigine) Orally
Disintegrating Tablets.
-- Eurand has completed a Phase III trial with ZENPEP in patients with
chronic pancreatitis and the data are currently under evaluation.
EUR-1048 -- LAMICTAL® ODT(TM) (lamotrigine) Orally Disintegrating Tablets
-- As announced on May 11, 2009, the FDA approved EUR-1048, LAMICTAL ODT
for the treatment of Bipolar I disorder and seizures. Eurand's partner,
GlaxoSmithKline, launched LAMICTAL ODT in late June 2009. Co-developed by
Eurand andGSK, LAMICTAL ODT uses Eurand's AdvaTab® orally disintegrating
tablet and Microcaps® taste-masking technologies. In addition to
receiving an undisclosed milestone payment upon launch, Eurand earns
revenue for manufacturing LAMICTAL ODT tablets for GSK, royalties on net
sales of the product and milestone payments in connection with LAMICTAL ODT
achieving predetermined sales levels in the U.S.
EUR-1025 -- Once-Daily Formulation of Ondansetron
-- As previously disclosed, Eurand conducted two pivotal pharmacokinetic
studies of EUR-1025, a proprietary once-a-day oral modified-release
formulation of ondansetron versus an 8 mg dose of the anti-emetic drug
Zofran® (ondansetron). Based on the results of these studies, the Company
expects that EUR-1025 has a similar efficacy and safety profile as 8 mg
Zofran dosed three times a day. Eurand has recently initiated discussions
with the FDA regarding the future development of EUR-1025.
THIRD QUARTER 2009 FINANCIAL RESULTS Total revenues were EUR 30.6 million ($44.8 million) in the third quarter of 2009, an increase of approximately 25%, or 19% at constant currency rates, compared with the third quarter of 2008. Product sales grew 24%, or 19% at constant currency rates, to EUR 25.1 million ($36.7 million) in the third quarter of 2009 compared with the same period of 2008. This increase can be attributed mainly to sales of ULTRASE to Axcan and sales of Eurand's Pancrelipase product. Royalties were EUR 2.8 million ($4.1 million), representing an increase of 40%, or 34% at constant currency rates, compared with the third quarter of 2008, due primarily to AMRIX by Cephalon. Development fees for the third quarter of 2009 were EUR 2.7 million ($4.0 million), up 13%, or 9% at constant currency rates, from the prior year period. Revenue from development fees can fluctuate from quarter to quarter because a significant portion of fees are recognized upon achievement of development milestones. Cost of goods sold was EUR 15.5 million ($22.7 million) for the three months ended September 30, 2009, up 10%, or 8% at constant currency rates, compared with the same period in 2008. The margin on product sales was 38.1% versus 30.1% in the third quarter of 2008, reflecting the increased proportion of higher margin products within the total product sales figure. Research and development (R&D) expenses were EUR 6.5 million ($9.5 million) for the three months ended September 30, 2009, up 36%, or 33% at constant currency rates, compared with the same period in 2008. Selling, general and administrative (SG&A) expenses of EUR 7.9 million ($11.5 million) were up 6%, or 3% at constant currency rates, compared with the third quarter of 2008. Operating income for the third quarter of 2009 was EUR 0.4 million ($0.6 million) versus operating income of EUR 22.5 million ($32.9 million) for the comparable period of 2008. The settlement of litigation with UCB for $35 million in August 2008 translated at the then exchange rate of approximately EUR1=$1.43 into a gain of EUR 24.4 million ($35.7 million at the convenience rate) was recorded as income from litigation settlement, a component of Eurand's operating income for the third quarter of 2008. Excluding this one-time gain, operating results would have been a loss of approximately EUR 1.9 million ($2.8 million) for the third quarter of 2008. Tax expense was EUR 0.9 million ($1.3 million) versus EUR 2.4 million ($3.5 million) for the third quarter of 2008. Tax expense for the three months ended September 30, 2008 included EUR 1.4 million ($2.0 million) of provision expense related to amounts required to be recorded for changes to the tax position. Net loss for the third quarter of 2009 was EUR 0.4 million ($0.6 million) or EUR (0.01) per fully diluted share ($(0.01) per share). Net income for the third quarter of 2008 was EUR 20.2 million ($29.6 million), or EUR 0.43 per fully diluted share ($0.63 per share). At September 30, 2009, cash, cash equivalents and marketable securities totaled EUR 31.3 million ($45.8 million). This included the first of two $5 million anniversary payments as part of the $35 million cash settlement of litigation with UCB, Inc. in August 2008. YEAR-TO-DATE 2009 FINANCIAL RESULTS For the nine months ended September 30, 2009, total revenues were EUR 90.3 million ($132.1 million), an increase of approximately 24%, or 15% at constant currency rates, compared with the same period of 2008. The increase in revenues can be attributed primarily to sales of Pancrelipase and sales of ULTRASE to Axcan, to higher royalties, notably from AMRIX by Cephalon, and to higher development fees. Product sales grew 21%, or 12% at constant currency rates, to EUR 73.2 million ($107.0 million) year to date in 2009 compared with the same period of 2008. Royalties of EUR 8.1 million ($11.9 million) were up 51%, or 36% at constant currency rates, compared with the first nine months of 2008. Development fees were EUR 9.0 million ($13.2 million), up 33%, or 23% at constant currency rates, from the prior year period. Cost of goods sold was EUR 45.3 million ($66.3 million) for the nine months ended September 30, 2009, up 14% from the prior year period, or 8% at constant currency rates. The margin on product sales was 38.0% year to date in 2009 versus 34.7% for the comparable period in 2008, reflecting the increased proportion of higher margin pancreatic enzyme products within the total product sales figure. R&D expenses were EUR 18.2 million ($26.6 million) for the nine months ended September 30, 2009, up 38%, or 30% at constant currency rates, compared with the same period in 2008. SG&A expenses of EUR 24.5 million ($35.9 million) were up 5% compared with the nine months in 2008 but were down 1% at constant currency rates. For the year to date in 2009, operating income was EUR 1.2 million ($1.8 million). For the nine months in 2008, operating income was EUR 20.1 million ($29.4 million). The settlement of litigation with UCB for $35 million translated at the then current exchange rate of approximately EUR1=$1.43 into a gain of EUR 24.4 million ($35.7 million at the convenience rate) was recorded as income from litigation settlement, a component of Eurand's operating income for the nine months ended September 30, 2008. Excluding the impact of this gain, operating results would have been a loss of EUR 4.3 million ($6.3 million) year to date in 2008. The net loss for the first nine months of 2009 was EUR 2.0 million ($2.9 million), or EUR (0.04) per fully diluted share ($(0.06) per share). Net income was EUR 16.4 million ($24.0 million), or EUR 0.35 per fully diluted share ($0.52 per share), for the first nine months of 2008. Following this news release are three tables: 1. Selected consolidated statements of operations for the three months ended September 30, 2009 compared with the same period in 2008 2. Selected consolidated statements of operations for the nine months ended September 30, 2009 compared with the same period in 2008 3. Selected balance sheet data as of September 30, 2009 and December 31, 2008 This news release contains translations of euros into U.S. dollars at a convenience rate of EUR1=$1.463, the noon buying rate at the Federal Reserve Bank of New York on September 30, 2009. Percentage variances quoted in "Constant Currency" represent the increase or decrease recomputed as if euro/dollar exchange rates had been the same in the three months ended September 30, 2009 as they were in the same period in 2008. As a guide, average exchange rates were EUR1=$1.430 in the three months to September 30, 2009, EUR1=$1.365 in the nine months to September 30, 2009, EUR1=$1.503 in the three months to September 30, 2008 and EUR1=$1.522 in the nine months to September 30, 2008. Conference Call Information Eurand will host a conference call today, Thursday, November 5, 2009 at 8:30 a.m. Eastern Time, 2:30 p.m. Central Europe Time, covering the third quarter and nine months 2009 financial results. To participate in the conference call, U.S. participants dial 1-877-407-9039, international participants dial +1-201-689-8470. A replay of the call will be available until December 5, 2009. To participate in the replay of the call, U.S. participants dial 1-877-660-6853, international participants dial +1-201-612-7415. The account number is: 3055, conference ID number: 334294. A live web cast of the call will also be available from the investor relations section of the company website at www.eurand.com. Following the live webcast, the archived version of the call will be available at the same URL until December 5, 2009. About Eurand Eurand is a specialty pharmaceutical company that develops, manufactures and commercializes enhanced pharmaceutical and biopharmaceutical products based on its proprietary pharmaceutical technologies. Eurand has had six products approved by the FDA since 2001 and has a pipeline of product candidates in development for itself and its collaboration partners. The Company's technology platforms include bioavailability enhancement of poorly soluble drugs, custom release profiles, taste-masking orally disintegrating tablet (ODT) formulations, and drug conjugation. Eurand is a global company with facilities in the U.S. and Europe. For more information, visit www.eurand.com. Forward-Looking Statement This release, and oral statements made with respect to information contained in this release, constitute forward-looking statements. Such forward-looking statements include those which express plan, anticipation, intent, contingency, goals, targets or future development and/or otherwise are not statements of historical fact. The words "expects", "potentially", "anticipates", "could", "calls for" and similar expressions also identify forward-looking statements. These statements are based upon management's current expectations and are subject to risks and uncertainties, known and unknown, which could cause actual results and developments to differ materially from those expressed or implied in such statements. A non-exclusive list of important factors that may affect future results may be found in Eurand's filings with the Securities and Exchange Commission, including its recently filed Form F-3, annual report on Form 20-F and periodic reports on Form 6-K. Investors should evaluate any statement in light of these important factors. Forward-looking statements contained in this press release are made as of this date, and the Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Actual events could differ materially from those anticipated in the forward-looking statements. LAMICTAL ODT is a trademark of the GlaxoSmithKline group of companies.
Selected consolidated statements of operations for the three months ended
September 30, 2009 compared with the same period in 2008
Three months ended September 30,
2009 2009 2008 % Change
At current At constant
$'000(a) euro'000 euro'000 currency currency
Product sales 36,653 25,053 20,131 +24% +19%
Royalty income 4,118 2,815 2,013 +40% +34%
Development
fees 3,984 2,723 2,407 +13% +9%
---------- ---------- --------- -------- -------
Total revenues 44,755 30,591 24,551 +25% +19%
Cost of goods
sold (22,701) (15,517) (14,078) +10% +8%
R & D expenses (9,470) (6,473) (4,744) +36% +33%
S,G & A
expenses (11,492) (7,855) (7,423) +6% +3%
Amortization of
intangibles (492) (336) (213) +58% +54%
Income from
litigation
settlement - - 24,404 N.M. N.M.
---------- ---------- --------- -------- -------
Operating
income 600 410 22,497 N.M. N.M.
Financial
income 171 117 115 N.M. N.M.
---------- ---------- --------- -------- --------
Income before
taxes 771 527 22,612 N.M. N.M.
Income taxes (1,347) (921) (2,378) N.M. N.M.
---------- ---------- --------- -------- -------
Net income
(loss) (576) (394) 20,234 N.M. N.M.
========== ========== ========= ======== =======
Basic net
income (loss)
per share $ (0.01) EUR (0.01) EUR 0.45
Diluted net
income (loss)
per share $ (0.01) EUR (0.01) EUR 0.43
Weighted
average number
of shares used
to compute
basic income
(loss) per
share 45,775,720 45,775,720 45,062,378
Weighted
average number
of shares used
to compute
diluted income
(loss) per
share 45,775,720 45,775,720 46,622,060
(a) Figures in U.S. dollars are translated from the euro for convenience,
at a rate of 1Euro=$1.463, the noon buying rate at the Federal Reserve
Bank of New York on September 30, 2009.
Selected consolidated statements of operations for the nine months ended
September 30, 2009 compared with the same period in 2008
Nine months ended September 30,
2009 2009 2008 % Change
At current At constant
$'000(a) euro'000 euro'000 currency currency
Product sales 107,020 73,151 60,675 +21% +12%
Royalty income 11,869 8,113 5,370 +51% +36%
Development
fees 13,218 9,035 6,787 +33% +23%
---------- ---------- ---------- -------- ---------
Total revenues 132,107 90,299 72,832 +24% +15%
Cost of goods
sold (66,313) (45,327) (39,632) +14% +8%
R & D expenses (26,621) (18,196) (13,174) +38% +30%
S,G & A
expenses (35,851) (24,505) (23,256) +5% -1%
Amortization of
intangibles (1,518) (1,038) (1,078) -4% -10%
Income from
litigation
settlement - - 24,404 N.M. N.M.
---------- ---------- ---------- -------- ---------
Operating
income 1,804 1,233 20,096 N.M. N.M.
Financial
income
(expense) (76) (52) 365 N.M. N.M.
---------- ---------- ---------- -------- ---------
Income before
taxes 1,728 1,181 20,461 N.M. N.M.
Income taxes (4,610) (3,151) (4,042) N.M. N.M.
---------- ---------- ---------- -------- ---------
Net income
(loss) (2,882) (1,970) 16,419 N.M. N.M.
========== ========== ========== ======== =========
Basic net
income (loss)
per share ($0.06) (EUR 0.04) EUR 0.37
Diluted net
income (loss)
per share ($0.06) (EUR 0.04) EUR 0.35
Weighted
average number
of shares used
to compute
basic income
(loss) per
share 45,761,056 45,761,056 44,689,409
Weighted
average number
of shares used
to compute
diluted income
(loss) per
share 45,761,056 45,761,056 46,437,140
(a) Figures in U.S. dollars are translated from the euro for convenience,
at a rate of 1Euro=$1.463, the noon buying rate at the Federal Reserve
Bank of New York on September 30, 2009.
Selected balance sheet data as of September 30, 2009 and December 31, 2008
September 30, December 31,
2009 2009 2008
$'000 (1) euro'000 euro'000
Cash and cash equivalents 24,476 16,730 19,146
Marketable securities 21,333 14,582 3,592
Total debt - - 186
Total shareholders' equity 147,922 101,109 102,102
(1) Figures in U.S. dollars are translated from the euro for convenience,
at a rate of 1Euro=$1.463, the noon buying rate at the Federal Reserve
Bank of New York on September 30, 2009.
Contact:
Source: Eurand N.V.
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