Allschwil, Switzerland, July 29, 2003 (PRIMEZONE) --
-- Tracleer(r) sales in Pulmonary Arterial Hypertension progressing on track
-- Controlled increase in operating expenses
-- Major clinical trials for new Tracleer and Veletri(tm) indications are now recruiting
-- FY 03 operating revenue forecast confirmed
Actelion Ltd (SWX:ATLN) today announced its financial result for the first six months of 2003. With operating revenues for H1 2003 of CHF 133.6 million (H1 2002: CHF 51.1 m) and operating expenses of CHF 105.5 million (H1 2002: 74.0m), the company reported an operating profit of CHF 10.1 million (H1 2002 loss: -29.7m). The net profit for H1 2003 was CHF 13.1 million (H1 2002 loss: CHF -29.4m).
Accordingly the earnings per share (EPS) for H1 2003 improved to CHF 0.61, compared to H1 2002 with a loss per share of CHF (1.39). Earnings per share for Q2 2003 were CHF 0.39 (Q1 2003: CHF 0.22).
Andrew J. Oakley, Chief Financial Officer commented: "In the first half of 2003, Actelion has been able to consistently generate operating profits, far ahead of previous expectations. This is due to both, strong Tracleer(r) sales with a high gross margin and our commitment to tight cost control. Being profitable allows Actelion to continue its investment in Tracleer(r) in the marketplace. We can also fund future growth opportunities through our substantial research and development programs."
Jean-Paul Clozel, MD and Chief Executive Officer, commented: "I believe that the successful introduction in PAH is only the starting point for Tracleer(r) and dual endothelin receptor antagonism. With major clinical trials now enrolling patients, for example with Tracleer(r) in Pulmonary Fibrosis or with tezosentan (VeletriTM) in acute heart failure (AHF), Actelion has major potential for multiple additional growth drivers."
Andrew J. Oakley concluded: "In the first half of 2003, sales of our lead product, Tracleer(R) for Pulmonary Arterial Hypertension, have continued to grow. As a result, Actelion is well on track to achieve FY 2003 total operating revenues of between CHF 290 and 310 million. Unforeseen events excluded, the two remaining quarters of 2003 are expected to be profitable at the operating level."
Disciplined bottom line management results in operating profit growth
mio CHF H1 2003 H1 2002 Variance Total operating revenue 133.6 51.1 +161% Cost of Sales 18.0 6.7 +169% Operating Expenses 105.5 74.0 +42% Operating Income 10.1 (29.7) Net Income 13.1 (29.4) Basic EPS 0.61 (1.39) Diluted EPS 0.57 N/a Gross Cash & cash equivalent and Marketable securities 124.7 101.1 +23% Number of employees 625 481 +30% mio CHF Q2 2003 Q1 2003 Variance Total operating revenue 69.9 63.7 +10% Cost of Sales 9.3 8.7 +7% Operating Expenses 54.2 51.3 +6% Operating Income 6.4 3.7 +73% Net Income 8.3 4.8 +73% Basic EPS 0.39 0.22 +77% Diluted EPS 0.36 0.22 +64% Gross Cash & cash equivalent and Marketable securities 124.7 117.1 +6% Number of employees 625 579 +8%
The full financial statements can be found on http://www.actelion.com.
Strong Tracleer(r) revenues are on track securing long-term growth of the business
In the first six months of 2003, Actelion had operating revenues of CHF 133.6 million (H1 2002: CHF 51.1 m). On a quarter-to-quarter basis, operating revenues increased by 10 percent to CHF 69.9 million (Q1 2003: 63.7m).
In H1 2003, Tracleer(r) sales were CHF 127.9 million (H1 2002: CHF 38.6 m). On a quarter-to-quarter basis, Tracleer(r) revenues increased by 11 percent to CHF 67.2 million (Q1 2003: 60.7m). In the first three months of the year, Tracleer(r) was fully launched in several major European markets such as Italy and Spain. Tracleer(r) is now commercially available in the United States, Canada, Switzerland and in all EU markets with the exception of Belgium and Luxembourg. In July, the Israeli authorities granted reimbursement status for Tracleer(r), allowing Actelion's partner Neopharm to initiate the commercial launch. Final reimbursement discussions are proceeding in Australia.
In Japan, the Tracleer(r) registration dossier is currently under review. A first hearing has taken place and approval of the product is expected in Q4 2003. Regulatory review is ongoing in Brazil and filing activities have been initiated in selected South East Asian markets -- Taiwan, Hong Kong, Singapore and Malaysia. An exclusive marketing and distribution agreement has been finalized with Excelsior Orphan Inc. in Taiwan.
In the first six month of 2003, further data analysis have confirmed the clinical benefits associated with the use of Tracleer(r) in Pulmonary Arterial Hypertension. In May 2003 Actelion announced the results of long-term follow up data of primary pulmonary hypertension patients from the Tracleer(r) pivotal registration studies. These data suggest that the use of Tracleer(r) is associated with improved survival. In the period under review, published results of an independent trial showed that Tracleer(r) improves heart remodeling parameters, which in turn have been associated with improved survival outcomes in patients with PAH (1).
Positive preliminary data of a study evaluating Tracleer(r) in HIV-related PAH (BREATHE-4) have been shared with the specialized medical community. The full data has been accepted for presentation at the upcoming meeting of the European Society of Cardiology (ESC) in Vienna (Austria) at the beginning of September 2003.
In spring 2003, Actelion launched Zavesca(r) first in the United Kingdom and later in Germany. As a result of prolonged enrollment and reimbursement procedures, only a few patients today benefit from the first oral treatment option for type 1 Gaucher disease. Accordingly, Zavesca(r) generated in H1 2003 revenues of CHF 0.1 million. Also in spring 2003, Actelion filed for US marketing authorization for Zavesca(r) and discussions with the US Food and Drug Regulatory Agency (FDA) are ongoing.
In H1 2003, Actelion's majority-owned subsidiary, Hesperion, contributed CHF 5.1 million (H1 2002: CHF 3.2 m) with sales of clinical development services. On a quarter-to-quarter basis, Hesperion revenues increased by 4 percent to CHF 2.6 million (Q1 2003: 2.5 m).
Operating Expenses under tight control
In H1 2003 operating expenses were CHF 105.5 million (H1 2002: CHF 74.0 m). In Q2 2003 operating expenses were CHF 54.2. Compared to the previous quarter (Q1 2003: CHF 51.3 m), this represents an increase of 6%.
In H1 2003, marketing and selling costs were CHF 51.0 million (H1 2002: CHF 34.8 m). In Q2 2003 marketing and selling expenses were CHF 27.0. Compared to the previous quarter (Q1 2003: CHF 23.9 m), this represents an increase of 13%. Overall, marketing and selling costs will continue to increase in line with the expansion of the business, especially in view of launching Tracleer(r) in Japan by year-end.
In H1 2003 research and development expenses were CHF 38.8 million (H1 2002: CHF 29.0 m). In Q2 2003 research and development expenses were CHF 19.4 m (Q1 2003: CHF 19.4 m). R&D expenditures are expected to increase in the second half of 2003 in line with the progress in enrolling patients into clinical trials evaluating new indications for Tracleer(r) and tezosentan (VeletriTM).
In H1 2003 management and general expenses amounted to CHF 15.8 million (H1 2002: CHF 10.3 m). In Q2 2003 management and general expenses were CHF 7.9 m and remained flat compared to the previous quarter (Q1 2003: CHF 7.9 m).
In H1 2003, stronger increases in sales revenues than operating expenses and an improvement in the gross margin resulted in an operating profit of CHF 10.1 million (H1 2002 loss: CHF -29.7 m). In Q2 2003 operating profit was CHF 6.4 m compared to CHF 3.7 m in the previous quarter.
In H1 2003, Actelion generated a net profit of CHF 13.1 million (H1 2002 loss: CHF -29.4 m). This is the result of a positive financial income of CHF 1.7 m and the recognition of income tax benefits of CHF 1.3 m and a net income attributable to minority shareholders of less than CHF 0.1 m. In Q2 2003, net income was CHF 8.3 m compared to CHF 4.8 m in Q1 2003.
Ongoing development efforts at Actelion
During the first six months of 2003, Actelion laid the foundation for future growth by commencing enrollment of patients in several clinical trials.
At the beginning of Q1 2003, Actelion started a clinical program with its urotensin II receptor antagonist -- the first ever brought into the clinic. The company expects phase I activities to conclude later this year.
In March 2003, a pilot study started to enroll up to 23 patients suffering from metastatic melanoma. The study is currently on track for results in Q2 2004.
In April 2003, enrollment started in the 1800 patient program VERITAS (Value of Endothelin Receptor Inhibition with Tezosentan in Acute heart failure Study) evaluating mortality/morbidity benefits with Actelion's intravenous dual endothelin receptor antagonist tezosentan (VeletriTM), in patients suffering from acute heart failure. In spring 2004, the company expects that the study will be halfway completed. At that time, an independent data safety monitoring board (DSMB) will perform a first interim futility analysis. The full trial is expected to conclude in spring 2005.
Due to the SARS epidemic in Toronto, enrollment came to a standstill for a pilot study evaluating VeletriTM, for Hepatorenal syndrome. The company has opened additional trial sites. Results are now expected in Q1 2004.
In late July 2003, the clinical programs involving Tracleer(r) in idiopathic pulmonary fibrosis (BUILD 1) and pulmonary fibrosis related to scleroderma (BUILD 2) started enrollment. These studies are expected to enroll up to 132 patients each and will conclude in late 2005. (BUILD: Bosentan Use in Interstitial Lung Disease).
Also in July 2003 and after discussions with regulatory authorities worldwide, Actelion finalized the study design for a second study evaluating Tracleer(r) in Digital Ulcerations related to systemic sclerosis (scleroderma). In the fall of 2002, Actelion had reported the positive results of the prevention study RAPIDS-I (Randomized Placebo-controlled Investigation of Digital ulcers in Scleroderma). RAPIDS-II will evaluate not only the potential of Tracleer(r) as a preventive, but also as a healing agent. RAPIDS-II, a double-blind, placebo-controlled study is expected to start enrollment of up to 180 patients worldwide in the fall of 2003, with study results expected in early 2005.
In addition to Tracleer(r) and tezosentan, several clinical trials are also ongoing involving Zavesca(r), evaluating the drug in lipid storage diseases other than type 1 Gaucher disease.
Progress in research
In the first six months of 2003, Actelion has made major progress in its research efforts. Advances in several programs are such that the company might be able to select drug candidates for full pre-clinical development in the near future. As a consequence, Actelion has further increased its early research efforts by establishing collaborations with Discovery Partners International (2) regarding pre-clinical services and Axovan (3) regarding the identification of drug leads.
NOTE TO THE EDITOR: Actelion will hold a Research and Development day at the end of October to give a comprehensive update on the full pre-clinical and clinical pipeline of the company.
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 as well as Canada 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).
For further information please contact: Actelion Ltd, Gewerbestrasse 16, CH-4123 Allschwil
Conference Call
Actelion will host an Investor Conference Call and discussion/Q&A on Tuesday, 29 July 2003, 15.30 CET / 09.30 a.m. EST / 14.30 GMT
Dial: +41 (0) 91 610 56 00 (Europe)
+1 412 858-4600 (U.S.)
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Webcast -- Live and replay on demand Actelion webcasts its Investor Conference Call. On the Web, you may either follow the call live or have the call replayed later on demand. To access the webcast, simply visit the link on our homepage http://www.actelion.com/ for further information.
(1) Galie, N., et al. Effects of the oral endothelin-receptor antagonist bosentan on echocardiographic and Doppler measures in patients with pulmonary arterial hypertension. J.Am.Col.Card. 41(8), 1380-6 (2003)
(2) Discovery Partners International Inc. is a leader in drug discovery collaborations offering integrated services and products that span the drug discovery continuum including target characterization, high throughput screening, lead generation, lead optimization, high throughput synthesis automation, and gene expression analysis. Discovery Partners is headquartered in San Diego, California and has operations in the United States and Europe.
(3) Axovan was founded in 2000 as a research company focusing on G-protein coupled receptors. Actelion participated in the first venture capital round and held more than 20 percent of the company. In 2002, Axovan raised further VC funds. Post this financing round, Actelion's stake in Axovan dropped to below 10 percent. The value of Actelion's investment in Axovan is carried at cost.