-- Total net revenue up 41% to CHF 663.6 million
-- Tracleer(r) sales up 41 % to CHF 633.2 million
-- Operating income up 78% to CHF 152.3 million
-- Net income of CHF 125.5 million
-- Rapidly growing PAH market
-- Expanding R&D pipeline
-- Ongoing Tracleer(r) growth and acceleration of R&D investment
forecasted for 2006
ALLSCHWIL, Switzerland, Feb. 23, 2006 (PRIMEZONE) -- Actelion Ltd. (SWX:ATLN) (Other OTC:ALIOF) today announced its financial results for the full year 2005. With total net revenue of CHF 663.6 million (FY 2004: 471.9 m) and operating expenses of CHF 511.3 million (FY 2004: 386.3 m), the company reported operating income of CHF 152.3 million (FY 2004: 85.6 m).
Net income was CHF 125.5 million (FY 2004: 87.2 m, including a gain from discontinued operations of 9.6 m). Accordingly, basic earnings per share (EPS) for 2005 improved to CHF 5.62 compared to EPS of CHF 3.96 in 2004.
On 31 December 2005, the company had a gross cash position of CHF 382.9 million (31 December 2004: 300.3 m). In 2005, the company generated a positive cash flow from operations of CHF 138.4 million (FY 2004: 91.7 m).
Jean-Paul Clozel, M.D and Chief Executive Officer commented: "In 2005, our educational efforts resulted in a rapidly expanding PAH market, with consequently outstanding Tracleer(r) sales growth. We are well prepared for future growth, with Tracleer(r) being the best documented oral PAH drug, supported by an experienced marketing and sales team as well as by many label expansion studies. Unforeseen events excluded, I am therefore confident that Actelion will achieve 1 billion Swiss Francs in total net revenues by no later than 2009."
Jean-Paul Clozel concluded: "With a rapidly expanding pipeline, operating profitability, cash generation from operations and an experienced staff of more than 1,000 worldwide, Actelion has achieved full strategic freedom to pursue multiple options to further accelerate growth."
Andrew J. Oakley, Chief Financial Officer commented: "With the PAH market continuing to expand, the outstanding 2005 growth is expected to continue. Unforeseen events excluded, I expect Actelion's 2006 total net revenue to reach between 810 and 840 million Swiss Francs."
Andrew J. Oakley added: "Our operating expenses in 2005 increased to CHF 511.3 million, in line with the overall expansion of the business. To maximize long-term value creation, we will manage our 2006 cost base to result in an expected operating profit of 165 to 180 million Swiss Francs. With 2006 operating expenses of between 655 and 725 million Swiss Francs, we can therefore continue to both invest in our marketed products whilst accelerating investment in R&D. Accordingly, I expect Actelion will generate the necessary positive cash flow from operations to further strengthen our financial position and maintain maximum operational and strategic flexibility."
Andrew J. Oakley concluded: "As a reminder, Actelion started to account for its Employee Stock Option Program (ESOP) according to the U.S. GAAP standard FAS 123R as from 1 July 2005. This will result in a non-cash charge of approximately 30 million Swiss Francs for the FY 2006, compared to CHF 13.6 million in 2005.
Financial result 2005
In CHF thousands Results FY 2005 Results FY 2004 Variance n %
Net Revenues 663,589 471,880 191,709 +41
Operating Expenses 511,299(a) 386,295 125,004 +32
Operating Income 152,290 85,585 66,705 +78
Net Income 125,538 87,219(b) 38,319 +44
Basic EPS in CHF 5.62 3.96 1.66 +42
Diluted EPS in CHF 5.54 3.78 1.76 +47
Cash & cash equivalents 382,917 300,336 82,581 +27
(a) includes non-cash charge for employee stock options of CHF
13.6 million
(b) includes income from discontinued operations of CHF 9.6 million
The Actelion Ltd consolidated financial statements for FY 2005 can
be found on http://www.actelion.com.
Outstanding growth of total net revenues
In 2005, total net revenue increased to CHF 663.6 million (2004: 471.9 m), including Tracleer(r) sales revenue of CHF 633.2 million (2004: 449.2 m), Zavesca(r) sales revenue of CHF 14.4 million (2004: 6.1 m) and contract revenue of CHF 16.0 million (2004: 16.5 m).
On a quarter-to-quarter basis, net revenues increased 3% percent to CHF 186.5 million (Q3 2005: CHF 180.8 m).
Strong Tracleer(r) sales
In 2005, Tracleer(r) sales were CHF 633.2 million (FY 2004: CHF 449.2 m). On a quarter-to-quarter basis, Tracleer(r) revenues increased 3 percent to CHF 178.0 million (Q3 2005: 172.9 m). This increase may partially be attributed to buying pattern variations similar to those seen in previous quarters.
At the end of December 2005, Tracleer(r) was available in 36 countries worldwide, including all major pharmaceutical markets. In 2005, Tracleer(r) was launched in Japan, Brazil, Taiwan and several new EU member states, such as the Czech Republic and the Slovak Republic. In July 2005, Actelion Pharmaceuticals Korea signed a distribution agreement for Tracleer(r) in Korea with Handok Pharmaceuticals, a Korean public company.
Regulatory and/or reimbursement reviews are ongoing in many other countries, such as the remaining new EU member states as well as in some South East Asian countries.
Christian Chavy, President of Business Operations commented: "Tracleer(r) today is the established brand that has created the pulmonary arterial hypertension market. To keep step with its expanding geographical presence and maximize market opportunities for its current products, Actelion has, in 2005, substantially increased its marketing and sales organization. We will continue to provide a high level of service to both physicians and their patients. Our educational efforts are based on long-term safety and outcome data, generated by multiple clinical trials and more than four years of market experience. Tracleer(r) has clearly become the undisputed cornerstone of PAH therapy."
Further data demonstrates unique clinical features of Tracleer(r) (bosentan)
In mid-July 2005, Actelion reported top-line results of BREATHE-5, the first ever placebo-controlled study conducted in patients with Eisenmenger's syndrome, a severe form of Congenital Heart Disease (CHD). The results showed that bosentan treatment decreased pulmonary vascular resistance and improved exercise capacity without a worsening in oxygen saturation. Discussions with regulatory authorities on appropriately labeling these findings are forthcoming. A first scientific presentation was held at CHEST in Montreal at the beginning of November 2005.
In mid-August 2005, the Journal of the American College of Cardiology (JACC) published a new study that investigated the long-term outcome of children with pulmonary arterial hypertension (PAH) treated with bosentan with or without concomitant prostanoid therapy. The authors concluded that bosentan, with or without concomitant prostanoid therapy, in this study was shown to be efficacious for the treatment of PAH in children. In addition, this study also indicated that the safety profile appears similar to that in adult PAH patients.
In early September 2005, Actelion presented two abstracts at the European Society of Cardiology (ESC) conference, which confirmed the long-term safety profile of bosentan in treating PAH. The abstracts included data focusing on PAH associated with chronic thrombo-embolic pulmonary hypertension (CTEPH) as well as data outlining the safety profile of bosentan in PAH related to congenital heart disease (CHD).
In early August 2005, Actelion announced the preliminary result of a double-blind, placebo-controlled, randomized, multi-center, 190-patient Phase III study with bosentan, RAPIDS-2, in systemic sclerosis patients suffering from digital ulceration. Preliminary analyses indicated that the co-primary endpoint of reduction in the occurrence of new digital ulcers during the 6-month treatment period was statistically significant. This result confirmed the positive findings from an earlier trial, RAPIDS-1. Actelion is currently analyzing data for presentation to regulatory authorities. A first scientific presentation was given at the ACR in San Diego in mid-November 2005.
Zavesca(r) sales continue momentum
Zavesca(r) sales contributed CHF 14.4 million (FY 2004: CHF 6.1 m) in 2005. On a quarter-to-quarter basis, Zavesca(r) revenues increased 15% to CHF 4.6 million (Q3 05: CHF 4.0 m). Zavesca(r) is commercially available in the United States and in most European markets.
Operating expenses reflect substantial efforts in both Marketing and R&D
In 2005, operating expenses were CHF 511.3 million (FY 2004: CHF 386.3 m). In Q4 2005, operating expenses were CHF 160.3 million. Compared to the previous quarter, this represents an increase of 20% (Q3 2005: CHF 133.6 m).
In 2005, research and development expenses were CHF 171.5 million (FY 2004: CHF 136.3 m). In Q4 2005 research and development expenses were CHF 50.2 million. Compared to the previous quarter, this represents an increase of 5% (Q3 2005: CHF 48.0 m).
Increased development expenses were mainly driven by the rapid enrollment of patients into the CONSCIOUS-1 phase IIb/III study, evaluating clazosentan in vasospasm as consequence of aneurysmal subarachnoid hemorrhage (SAH). In late November 2005, CONSCIOUS-1 completed recruitment. Interest in clazosentan increased with the publication of the Phase IIa study results in the July 2005 edition of the Journal of Neurosurgery suggesting that clazosentan could reduce the number and severity of cases of vasospasm following SAH.
In 2005, marketing and advertising expenses were CHF 140.0 million (FY 2004: 101.7 m). In Q4 2005 marketing and advertising expenses were CHF 51.4 million, an increase of 61% compared to the previous quarter (Q3 2005: CHF 31.9 m). This substantial increase is mainly due to the congress season, but also due to the high start-up costs associated with the COMPASS program, a comprehensive clinical effort to evaluate the long-term outcome of either the bosentan/sildenafil combination or sildenafil monotherapy in PAH. Also in Q4 2005, Actelion expanded several patient registries and similar programs to collect and share real-life experience with Tracleer(r) in PAH.
In 2005 selling, general and administrative expenses amounted to CHF 132.1 million (FY 2004: CHF 95.7 m). In Q4 2005 selling, general and administrative expenses were CHF 39.4 million, an increase of 13% compared to the previous quarter (Q3 2005: CHF 34.8 m). The increase is in line with the increase of sales force headcount and related sales-based remuneration.
Strong operating profit
In 2005, a strong increase in sales revenues resulted in an operating profit of CHF 152.3 million (FY 2004: CHF 85.6 m). Taking into account the increased M&A spending, Q4 2005 operating profit of CHF 26.2 million was 45% lower than the previous quarter (Q3 2005: CHF 47.2 m).
Non-operating items and cash
In 2005, the net profit of CHF 125.5 million (FY 2004: CHF 87.2 m) includes interest income of CHF 3.0 million, interest expense of CHF 0.2 million, a non-cash charge on the Convertible Bond of CHF 7.8 million, other financial expense of CHF 11.3 million and an income tax expense of CHF 10.5 million.
In Q4 2005, the net profit was CHF 24.3 million compared to CHF 35.3 million in the previous quarter.
In 2005, Actelion generated net cash flow from operations of CHF 138.4 million (FY 2004: CHF 91.7 m). Cash and cash equivalents and short-term deposits as of 31 December 2005 were CHF 382.9 million (30 September 2005: CHF 344.0 m).
Review of Research and Development programs
-- The EARLY study, a double-blind, placebo-controlled clinical trial
evaluating the safety and efficacy of bosentan in class II PAH
patients, is in the process of enrolling 170 patients worldwide.
Study results are expected by year-end 2006.
-- The pediatric Phase III study FUTURE-1 is evaluating the safety
and bioequivalency of a special pediatric formulation of bosentan.
Initial results are expected in Q3 2006, with patients then rolled
over in the open-label study FUTURE-2.
-- The COMPASS program evaluates the safety and efficacy of bosentan
in PAH patients in combination with sildenafil. This large-scale
program is evaluating both hemodynamic benefits (COMPASS-1) as
well as effects on mortality/ morbidity of the combination
(COMPASS-2) are starting enrollment in Q1 2006.
-- The BENEFIT study, a double-blind, placebo-controlled Phase III
trial to evaluate the safety and efficacy of bosentan is currently
enrolling patients suffering from chronic thrombo-embolic
pulmonary hypertension (CTEPH). CTEPH is caused by blockage of the
main arteries leading from the heart to the lungs by thrombotic
material. Study results are expected in Q2 2007.
-- The ASSET Program with two trials, ASSET-1 and ASSET-2, has been
initiated to evaluate the safety and efficacy of Tracleer(r) in
pulmonary hypertension secondary to sickle cell disease. The
program also explores the potential of Tracleer(r) to reduce the
frequency of sickle crises, for which endothelin is believed to
play a central role. Results are expected in Q3 2007.
-- A placebo-controlled randomized trial is currently enrolling
patients to evaluate the safety and efficacy of bosentan in
patients with advanced metastatic melanoma. An earlier open-label
trial in end-stage patients with metastatic melanoma at five
centers in Australia showed that high doses of bosentan were well
tolerated. Results of the new event-driven study are expected in
2007.
-- Following encouraging findings in the BUILD-1 study evaluating the
safety and efficacy of bosentan in idiopathic pulmonary fibrosis
(IPF), the company is currently finalizing the design for a
mortality-morbidity driven Phase III study, BUILD-3, for
discussions with regulatory authorities worldwide.
-- The MAINTENANCE program, evaluating the long-term safety and
efficacy of miglustat (Zavesca(r)) as maintenance therapy after a
switch from enzyme replacement therapy (ERT) in adult type 1
Gaucher patients with stable disease, has been initiated in late
2005. First interim results could become available by year-end
2007.
-- Analyses have been recently completed for three clinical programs,
with a total of 100 adult and pediatric patients, evaluating the
safety and efficacy of high-dose miglustat (Zavesca(r)) in
lysosomal storage disorders with predominant neurological
manifestations, namely Niemann-Pick type C (NP-C), Gaucher type 3
(GD3) and Late onset Tay-Sachs (LOTS). In NP-C, encouraging
results have been seen at 12-months in adult and pediatric
patients, with improvement or stabilization of key features of the
disease such as saccadic eye movements, swallowing, cognition, and
auditory function, underlying the ability of miglustat to work in
the brain. After consultation with experts, Actelion has decided
that these results warrant discussion with regulatory authorities.
The NP-C study is continuing as planned for 24 months, as is the
GD3 study, where the 12-month results were inconclusive. With
respect to LOTS, the 24-month results in a group of severe,
heterogeneous and advanced patients showed no change in the
progression of the disease. In all three studies, the safety
profile was consistent with earlier observations in patients with
type 1 Gaucher disease, where only half the dose is being used.
-- CONSCIOUS-1, a multi-center, international, double-blind,
randomized, placebo-controlled, parallel group, evaluating the
safety and efficacy of three dose levels of clazosentan in
preventing the occurrence of cerebral vasospasm following
aneurysmal subarachnoid hemorrhage (SAH), has completed enrollment
in late November 2005. CONSCIOUS-1 has recruited over 400 patients
in 52 centers in 11 countries worldwide. Study results are
expected in Q2 2006 and should provide the necessary information
(dose, number of patients) for a mortality-morbidity-driven Phase
III study.
-- Actelion-1, an undisclosed compound is currently in a Phase IIa
program to evaluate its potential in cardiovascular indications.
-- The single-dose Phase I study evaluating Actelion's Orexin
Receptor Antagonist was successfully concluded in late 2005. The
compound is well-tolerated, with quick absorption and disposition
as well as other necessary features required for a sleep agent.
The Phase II program with patients suffering from insomnia, the
primary target indication, is expected to commence enrollment in
Q1 2006. First results may be available before year-end 2006.
-- Entry-into-man for the S1P1 agonist is expected in the coming
months. S1P1 agonism might have therapeutic potential in multiple
autoimmune diseases, such as multiple sclerosis or rheumatoid
arthritis. Initial Phase I findings are expected by year-end 2006.
-- In 2005, a second milestone in the Global Actelion Merck Renin
Inhibitor Alliance project was achieved, when a highly
bioavailable renin inhibitor was selected for full preclinical
development, which is currently ongoing. Entry into man is planned
before mid-2006.
-- A broad research program in the field of antibacterials focusing
on fighting resistant bacterial pathogens through novel mechanisms
of action is progressing.
-- An additional number of unnamed projects are in various phases of
drug discovery. These projects target indications in immunology,
cardiovascular diseases, infectious diseases and central nervous
system disorders.
For documentation purposes -- table Q4 2005 vs. Q3 2005
In CHF thousands Results Q4 2005 Results Q3 2005 Variance in %
Net Revenues 186,533 180,832 5,701 +3
Operating Expenses 160,317 133,595* 26,722 +20
Operating Profit 26,216 47,237 -21,021 -45
Net Profit 24,286 35,328 -11,042 -31
Basic EPS in CHF 1.08 1.58 -0.50 -32
Net cash from
operations 48,161 41,176 6,985 +17
NOTE TO THE EDITOR:
Actelion Ltd. will hold an Media and Analyst conference today to further comment on its financial performance and current marketing efforts for Tracleer(r) in today's approved indication, PAH. On the same day, the company will also provide a full update on its major current development programs.
Location: Unique Conference Center, Airport Zurich Media Conference: 23 February 2005, 09.30 am CET Analyst Conference: 23 February 2005, 12.30 pm CET
NOTE TO THE SHAREHOLDERS:
The Annual General Meeting of Shareholders approving the Business Report of the year ending 31 December 2005 will be held on 10 April 2006.
Shareholders holding more than 1 million CHF nominal value of shares (i.e. 400,000 shares at nominal value of CHF 2.50), being entitled to add items to the agenda of the general meeting of shareholders, are invited to send in proposals, if any, for the annual general meeting on 10 April 2006 to Actelion Ltd, att. Corporate Secretary, Gewerbestrasse 16, CH-4123 Allschwil, to arrive no later than 3 March 2006. Any proposal received after the given deadline will be disregarded.
In order to attend and vote at the Annual General Meeting of Shareholders, shareholders must be registered in the company's shareholders register by 31 March 2006 at the latest. Please note that the annual report 2005 will be available in March 2006, both in hard copy as well as on the company website www.actelion.com.
Actelion Ltd.
Actelion Ltd. is a biopharmaceutical company with its corporate headquarters in Allschwil/Basel, Switzerland. Actelion's first drug Tracleer(r), an orally available dual endothelin receptor antagonist, has been approved as a therapy for pulmonary arterial hypertension. Actelion markets Tracleer(r) through its own subsidiaries in key markets worldwide, including the United States (based in South San Francisco), the European Union, Japan, Canada, Australia and Switzerland. Actelion, founded in late 1997, is a leading player in innovative science related to the endothelium -- the single layer of cells separating every blood vessel from the blood stream. Actelion focuses on the discovery, development and marketing of innovative drugs for significant unmet medical needs. Actelion shares are traded on the SWX Swiss Exchange (ticker symbol: ATLN).
Videocast -- Live and replay on demand
Actelion videocasts its Analyst Conference, taking place on Thursday, 23 February 2006, 12.30 CET / 06.30 am EST / 11.30 GMT.
To access the videocast, simply visit the link on our homepage http://www.actelion.com 5-10 minutes before the conference is due to start. Approximately 60 minutes after the conference has ended, the archived investor videocast will be available for replay via our homepage.
Conference Call -- Live
Actelion will host a live transmission of the Analyst Conference via conference call on Thursday, 23 February 2006, 12.30 CET / 06.30 am EST / 11.30 GMT. Please note that questions can not be taken on the conference call.
Dial: +41 (0)91 610 56 00 (Europe and ROW)
+1 (1)866 291 4166 (U.S.)
+44 207 107 06 11 (U.K.)
Actelion's financial calendar 2006
Date: Event: 10 April 2006 Annual General Meeting 20 April 2006 Q1 2006 financial results 20 July 2006 H1 2006 financial results 19 October 2006 9-month 2006 financial results