-- Total net revenue up 43% to CHF 945.7 million
-- Tracleer(r) sales up 42% to CHF 898.7 million
-- Operating income up 76% to CHF 268.2 million
-- Net income up 92% to CHF 241.1 million
-- Ongoing growth for marketed products forecasted
-- Rapidly expanding and maturing pipeline highlights opportunity
for accelerated future growth
ALLSCHWIL, Switzerland, Feb. 22, 2007 (PRIME NEWSWIRE) -- Actelion Ltd (SWX:ATLN) today announced its financial results for the full year 2006. With total net revenue of CHF 945.7 million (FY 2005: 663.6 m) and operating expenses of CHF 677.5 million (FY 2005: 511.3 m), the company reported operating income under US-GAAP of CHF 268.2 million (FY 2005: 152.3 m).
Net income was CHF 241.1 million (FY 2005: 125.5 m.) Accordingly, fully diluted earnings per share (EPS) under US-GAAP for 2006 improved to CHF 10.25 compared to a 2005 US-GAAP EPS of CHF 5.54.
To better measure and compare our operating performance over time, Actelion also reports non-GAAP Cash-EBIT (Operating Income excluding non-cash charges such as In-Process R&D, charges related to employee stock options as well as amortization and depreciation). In 2006, Actelion achieved a Cash-EBIT of CHF 320.4 million, compared to CHF 178.6 million in 2005.
Jean-Paul Clozel, M.D. and Chief Executive Officer commented: "In 2006, Actelion has yet again improved its financial performance, driven by strong product sales and a careful upsizing of our infrastructure. Importantly, we are now more and more benefiting from our ongoing efforts in research, as our product pipeline rapidly expands. The S1P1-partnership we entered into with Roche in mid-2006 clearly demonstrates the innovation power of Actelion's research as well as our determination to maximize the medical potential and the related value creation from our compounds."
Jean-Paul Clozel continued: "By the end of 2007, I expect ten different chemical entities in clinical development, five alone in Phase III. All of these programs focus on areas of high unmet medical need, such as our Orexin Receptor Antagonist for sleeping disorders, where a majority of patients are being left untreated due to the limitations of current therapeutic options."
Jean-Paul Clozel concluded: "Over the coming years, I expect Actelion will substantially increase its investment into Research and Development, turning innovation into value as we have done and will continue to do with our currently marketed products. I expect that Tracleer(r), Ventavis(r) and Zavesca(r) will continue to grow in the coming years, as the result of the favorable characteristics each medication has demonstrated not only in recent clinical trials, but more importantly benefiting the patient especially in daily medical practice."
Andrew J. Oakley, Chief Financial Officer commented: "In 2006, we have continued to successfully execute our long-term strategy to become one of the world's leading biopharmaceutical companies. With our strong financial performance, we are ensuring that appropriate resources can be dedicated to further expand the market for our existing products. At the same time, we will increase spending to support our rapidly expanding pipeline and to align the organization with the transformatory potential of these projects."
Andrew J. Oakley added: "As a result of our global presence, we are also able to make rapidly cash-accretive acquisitions with additional future upside potential, as demonstrated with the CoTherix transaction that became effective in early January 2007. The combination of marketed products, innovative pipeline and sound financials has also allowed the company to finance such acquisitions at very favorable terms, as evidenced by the CHF 460 million zero-percent, zero yield to maturity convertible bond issued in November 2006."
Andrew J. Oakley concluded: "In 2007, I expect that Actelion will continue to report both revenue growth and Cash-EBIT growth. Unforeseen events excluded, total net revenues are expected to reach between CHF 1.175 and 1.225 billion. Operating income under US-GAAP is expected to be in the range of CHF 65 to 75 million, due to a substantial increase in non-cash charges, especially due to an In-Process R&D charge in relation to the CoTherix transaction of approximately CHF 200 million and higher charges for employee stock options due to the 146 percent performance of Actelion shares in 2006. By eliminating such non-cash items, I expect the company to report an increase in Cash-EBIT of between CHF 360 to 395 million."
Financial result 2006
In CHF thousands Results FY Results FY Variance in %
2006 2005
Net Revenues 945,673 663,589 282,084 + 43
Operating Expenses 677,484 511,299 166,185 + 33
Operating Income 268,189 152,290 115,899 + 76
Net Income 241,090 125,538 115,552 + 92
Basic EPS in CHF 10.64 5.62 5.02 + 89
Diluted EPS in CHF 10.25 5.54 4.71 + 85
Non-GAAP Cash-EBIT 320,375 178,570 141,805 + 79
The Actelion Ltd consolidated financial statements for FY 2006 can be found on http://www.actelion.com.
Outstanding growth of total net revenues
In 2006, total net revenue increased to CHF 945.7 million (2005: 663.6 m), including Tracleer(r) sales revenue of CHF 898.7 million (2005: 633.2 m), Zavesca(r) sales revenue of CHF 25.4 million (2005: 14.4 m) and contract revenue of CHF 21.5 million (2005: 16.0 m). On a quarter-to-quarter basis, net revenues increased 6% percent to CHF 261.4 million (Q3 2006: CHF 247.2 m).
Strong Tracleer(r) sales
In 2006, Tracleer(r) sales were CHF 898.7 million (FY 2005: CHF 633.2 m). On a quarter-to-quarter basis, Tracleer(r) revenues increased 6 percent to CHF 246.8 million (Q3 2006: 234.0 m). This increase may partially be attributed to buying pattern variations similar to those seen in previous quarters.
At the end of December 2006, Tracleer(r) was available in more than 30 countries worldwide, including all major pharmaceutical markets. In October 2006, Tracleer(r) was introduced in China and, together with Handok, in South Korea. Regulatory and/or reimbursement reviews are ongoing in many other countries, such as some new EU member states as well as in some South East Asian countries.
Christian Chavy, President of Business Operations commented. "In 2006, we have been able to witness a further expansion of the pulmonary arterial hypertension (PAH) market. As the market leader, we have been and continue to be committed to increase disease awareness through a wide variety of educational efforts. Based on strong clinical data with Tracleer(r) in many different forms of PAH, we have been and will be able to reach out to a growing number of different specialists treating patients likely to suffer from this progressive disorder. We expect disease awareness to increase further with the upcoming availability of other endothelin receptor antagonists. Actelion is well positioned to benefit from the resulting market expansion, especially as the recently concluded EARLY study again showed that our dual endothelin receptor antagonist is delaying time to clinical worsening, even in less advanced PAH patients."
Further data demonstrates unique clinical features of Tracleer(r) (bosentan)
In December 2006, Actelion reported that results from the double-blind, placebo-controlled, multicenter study EARLY (Endothelin Antagonist Trial in miLdly Symptomatic PAH patients, NYHA modified functional class II) indicate that six months of treatment with the dual endothelin receptor antagonist bosentan (Tracleer(r)) showed a significant reduction in pulmonary vascular resistance, a strong trend towards improved exercise capacity and a significant delay in the time to clinical worsening. These data are expected to be submitted shortly to health authorities for possible label expansion.
In 2006, the Tracleer(r) label was updated in numerous jurisdictions to reflect the results of the multi-center, randomized, double-blind, placebo-controlled study BREAHTE-5. This study evaluated the use of Tracleer(r) (bosentan) in pulmonary arterial hypertension (PAH) related to Eisenmenger's syndrome, a severe congenital heart defect.
In 2007, the company also plans to discuss with Health Authorities its children's formulation of bosentan, based on phamacodynamic data generated in the FUTURE-1 study.
In the coming months, Actelion expects the result of the BENEFIT program, evaluating the safety and efficacy of Tracleer(r) in patients suffering from chronic thromboembolic pulmonary hypertension. If positive, the company will ask for this information to be also included in the label.
Actelion also continues to evaluate the combination of Tracleer(r) with other PAH agents. The COMPASS-1 study in patients with PAH has demonstrated that single-dose sildenafil on top of Tracleer(r) therapy results in significant improvements in pulmonary vascular resistance. The COMPASS-2 study is evaluating the safety and efficacy of the combination of bosentan and sildenafil.
Additional clinical programs to focus on the safety and efficacy of using multiple pharmaceutical agents in PAH are either planned or already initiated. Actelion is also continuing the VISION program previously initiated by CoTherix, evaluating the safety and efficacy of Ventavis(r) (inhaled iloprost) on top of either sildenafil or the combination of sildenafil and Tracleer(r). In addition, efforts are underway to improve on both frequency and duration of inhalation through modification of the current inhalation device. Actelion is also evaluating reformulation possibilities, such as dry powder delivery.
Zavesca(r) sales continue momentum
Zavesca(r) sales contributed CHF 25.4 million (FY 2005: CHF 14.4 m) in 2006. On a quarter-to-quarter basis, Zavesca(r) revenues increased 17% to CHF 7.4 million (Q3 06: CHF 6.4 m). Zavesca(r) is commercially available in the United States and in most European markets.
Zavesca(r) is also being investigated in another lysosomal storage disorder. In Niemann Pick Type C, the company generated clinical data suggesting safety and efficacy and has, therefore, initiated a filing in the European Union. Trials in both Type 3 Gaucher disease and Late-Onset Tay Sachs did not generate findings that would warrant further studies.
Operating expenses reflect substantial efforts in both Marketing and R&D
In 2006, operating expenses were CHF 677.5 million (FY 2005: CHF 511.3 m). In Q4 2006, operating expenses were CHF 190.0 million. Compared to the previous quarter, this represents an increase of 11% (Q3 2006: CHF 170.7 m).
In 2006, research and development expenses were CHF 211.8 million (FY 2005: CHF 171.5 m). In Q4 2006 research and development expenses were CHF 56.7 million. Compared to the previous quarter, this represents an increase of 5% (Q3 2006: CHF 54.1 m).
In 2006, marketing and advertising expenses were CHF 185.5 million (FY 2005: 140.0 m).
In Q4 2006 marketing and advertising expenses were CHF 56.1 million, an increase of 29% compared to the previous quarter (Q3 2006: CHF 43.5 m). This substantial increase is mainly due to the congress season.
In 2006 selling, general and administrative expenses amounted to CHF 185.1 million (FY 2005: CHF 132.1 m). In Q4 2006 selling, general and administrative expenses were CHF 51.9 million, an increase of 7% compared to the previous quarter (Q3 2006: CHF 48.6 m). The increase is in line with the increase of sales force headcount and sales-based remuneration.
Strong operating profit
In 2006, a strong increase in sales revenues and revenue-based expenditure release, coupled with slightly lower spending in research and development, resulted in an operating profit of CHF 268.2 million (FY 2005: CHF 152.3 m). Taking into account the increased M&A spending, Q4 2006 operating profit of CHF 71.4 million was 7% lower than the previous quarter (Q3 2006: CHF 76.5 m).
Non-operating items
In 2006, the net profit of CHF 241.1 million (FY 2005: CHF 125.5 m) includes interest income of CHF 8.4 million, interest expense of CHF 0.2 million, a non-cash charge on Convertible Bonds of CHF 8.4 million, other financial income of CHF 10.7 million and an income tax expense of CHF 37.6 million, representing an annual 2006 tax rate of 13.5 percent.
In Q4 2006, the net profit was CHF 69.3 million compared to CHF 66.8 million in the previous quarter.
In 2006, Actelion generated net cash flow from operations of CHF 352.8 million (FY 2005: CHF 138.4 m).
Rapidly expanding clinical and pre-clinical pipeline
At its Actelion Day 2007, Actelion presented a detailed overview of its rapidly expanding and maturing pipeline. Actelion expects a total of ten different compounds in clinical development in 2007, five of them in the final pivotal stage of clinical development. These Phase III programs are (in alphabetical order):
-- Actelion-1 in PH: The pivotal program evaluating this tissue-targeting endothelin receptor antagonist in pulmonary hypertension (PH) is expected to start enrolling patients in Q3 2007. The program will enroll around 1,000 patients worldwide in two Phase III studies and aims at a morbidity/mortality claim. Study results are expected in several years.
-- Bosentan (Tracleer(r)) in IPF: The pivotal Phase III study BUILD-3 evaluates the safety and efficacy of this dual endothelin receptor antagonist in 390 patients suffering from idiopathic pulmonary fibrosis (IPF). Enrollment in this event-driven study carried out under a special protocol agreement (SPA) obtained from the US Food and Drug Administration, is ongoing and study results are expected in late 2009.
-- Clazosentan in aSAH: The pivotal Phase III study CONSCIOUS-2 is currently being discussed with Health Authorities. Actelion expects this pivotal program to start later in 2007, enrolling up to 1,800 patients, with results expected in late 2009.
-- Orexin Receptor Antagonist in sleeping disorders: Following first results from a successful proof-of-concept study for this first-in-class compound, Actelion expects to identify the lowest effective dose and dose range in the coming months. This information, together with results of other ongoing pre-clinical and clinical activities will define the final design of the upcoming Phase III program. The program is expected to start before year-end 2007 and to last between two and three years.
-- Tezosentan in acute cardiovascular care: Before mid-2007, Actelion will start recruitment in the first Phase III study evaluating safety and efficacy of this i.v. endothelin receptor antagonist for reduction of clinically relevant right ventricular failure (RVF) associated with difficult separation from bypass (DSB) in patients undergoing cardiac surgery with cardiopulmonary bypass (CPB). The first study will enroll up to 270 patients, with results expected in H2 2008. If positive, Actelion will then immediately perform a similar second pivotal study to compile a full registration dossier.
Additional progress in 2007 is expected in three other ongoing clinical programs in the fields of metastatic melanoma (bosentan, Phase II), cardiovascular disorders (Renin inhibitor partnered in 2003 with Merck & Co., Inc., Phase I) and autoimmune disorders (selective S1P1 receptor agonist, partnered in 2006 with Roche, Phase I).
In 2007, Actelion also expects to initiate a proof-of-concept study with miglustat (Zavesca(r)) in an undisclosed indication. In addition, the company expects two novel first-in-class compounds to enter into man in 2007, one i.v. antibiotic agent and one oral anti-allergic agent.
In Research, Actelion has currently more than 25 active drug discovery programs under investigation, focusing both on new chemical molecular entities (NCE) as well as follow-up compounds for new chemical entities already in either full pre-clinical or clinical development. In 2006, Actelion's discovery efforts resulted in the filing of 40 priority patent applications. At its current size and speed, Actelion's discovery efforts could lead to two or more compounds to enter full-preclinical testing every year.
Increase in global employment
At the end of 2006, Actelion had 1,252 employees (FTE's), an increase of 224 compared to the end of 2005. In Switzerland, Actelion employed 531 people (2005: 413).
For documentation purposes - table Q4 2006 vs. Q3 2006
In CHF thousands Results Q4 Results Q3 Variance in %
2006 2006
Net Revenues 261,394 247,180 14,214 +6
Operating Expenses 189,984 170,679 19,305 +11
Operating Profit 71,410 76,501 (5,091) (7)
Net Profit 69,298 66,804 2,494 +4
Diluted EPS in CHF 2.89 2.86 0.03 +1
non-US GAAP Cash-EBIT 84,438 90,293 (5,855) (6)
NOTE TO THE SHAREHOLDERS:
The Annual General Meeting of Shareholders approving the Business Report of the year ending 31 December 2006 will be held on 4 May 2007.
Shareholders holding more than CHF 1 million 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 of Shareholders on 4 May 2007 to Actelion Ltd, attention Corporate Secretary, Gewerbestrasse 16, CH-4123 Allschwil, to arrive no later than 16 March 2007.
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 23 April 2007 at the latest.
Please note that the Annual Report 2006 will be available in early April 2007, 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 as well as 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).
Actelion Day - 22 February 2007
Actelion will host an on-site 'Actelion Day' event in Allschwil, Switzerland. To follow the event via phone or webcast please follow the instructions on the Actelion website www.actelion.com. For direct access to the webcast please copy one of the following links into your browser:
Morning session: http://gaia.world-television.com/actelion/20070222/part1/trunc/ Afternoon session: http://gaia.world-television.com/actelion/20070222/part2/trunc/
Actelion's financial calendar 2007
Date: Event: 19 April 2007 Q1 2007 financial results 04 May 2007 Annual General Meeting 19 July 2007 H1 2007 financial results 18 October 2007 9-month 2007 financial results
Document as PDF:
http://www.newsbox.ch/public/10016/att/10635_mediareleasepdf.pdf
Description: Media Release (PDF)
Document as PDF:
http://www.newsbox.ch/public/10016/att/10634_financialstatementspdf.pdf
Description: FINANCIAL STATEMENTS (PDF)