Act fast if you want to hear the CC. Here's the PR. Aside from the somewhat expected rebound in Aloxi sales, the continued strength in Dacogen is also heartening, given the recent data from Vidaza. But as I and others noted, Dacogen is a prodrug of Vidaza, and I would think oncologists would expect similar performance, even though the analogous dat for Dacogen won't be out for a while. As such, I didn't really expect much impact from the Vidaza data. Pharmion is still riding pretty high on it, though, and it makes me think it might be time to revisit it as a short candidate . . .
>>MGI PHARMA Reports Third Quarter 2007 Financial Results
Wednesday October 17, 4:01 pm ET
--Third Quarter Marked By Strong Sales Growth, Increased Profitability, Significant Regulatory Progress and Business Development Activity--
--Aloxi(R) Sales Grow 37% Over Q2; Expecting 10% Sequential Growth in Q4--
--Sequential Dacogen(R) Sales Growth Continues--
MINNEAPOLIS--(BUSINESS WIRE)--MGI PHARMA, INC. (NASDAQ:MOGN - News), a biopharmaceutical company focused in oncology and acute care, today reported financial results for the three months ended September 30, 2007.
Total revenue for the third quarter of 2007 was $112.5 million compared to $97.0 million for the third quarter of 2006. The Company reported GAAP net income of $10.9 million, or $0.13 per diluted share, in the 2007 third quarter compared to GAAP net income of $1.7 million, or $0.02 per diluted share, in the 2006 third quarter. Adjusted or non-GAAP net income for the 2007 third quarter increased to $24.8 million, or $0.30 per diluted share, compared to adjusted net income of $5.8 million, or $0.07 per diluted share, in the 2006 third quarter. See "Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income" below for information on the adjusted numbers presented in this press release.
At September 30, 2007, MGI PHARMA's cash and marketable debt investments totaled $166.5 million.
"We are pleased with the Aloxi and Dacogen sales results, the excellent earnings performance, and the many accomplishments achieved on the regulatory front" said Lonnie Moulder, President and Chief Executive Officer of MGI PHARMA. "The acceptance of the Aloxi sNDA by the FDA for PONV, the recently approved sNDA allowing for repeated doses of Aloxi in association with multi-day chemotherapy regimens, and the submission of the Aquavan NDA during the third quarter reflect our commitment to achieving our stated goals. From a business development perspective, the addition of AKR-501 to our pipeline, an exciting product candidate for treating thrombocytopenia, provides us with a significant future growth opportunity."
Product Sales Performance
Product sales increased to $110.8 million in the third quarter of 2007 compared to $95.5 million in the third quarter of 2006.
During the third quarter of 2007, sales of Aloxi® (palonosetron hydrochloride) Injection totaled $66.3 million compared to $70.4 million in the third quarter of 2006. Sales of Dacogen® (decitabine) for Injection totaled $34.6 million in the third quarter compared to $11.9 million in the third quarter of 2006, its first full quarter of commercial availability.
Operating Expenses
Selling, general and administrative expenses totaled $38.7 million for the third quarter compared to $38.4 million for the third quarter of 2006. Adjusted selling, general and administrative expenses were $34.4 million for the third quarter of 2007 compared to $36.1 million for the same period in 2006.
Research and development expenses totaled $22.8 million for the third quarter compared to $21.2 million for the third quarter of 2006. On a GAAP basis, research and development expenses contained a $5 million milestone payment to HELSINN HEALTHCARE SA related to the FDA's acceptance of the sNDA for the post operative nausea and vomiting indication of Aloxi. Adjusted research and development expenses in the third quarter of 2007 were $16.7 million compared to $20.5 million in the third quarter of 2006. This decrease is primarily due to the conclusion of certain clinical trials and the restructure activities implemented at the end of 2006.
Operating income for the third quarter was $11.2 million compared to operating income of $2.6 million for the same period in 2006. Adjusted operating income for the third quarter increased to $25.2 million compared to an adjusted operating income of $6.6 million for the same period in 2006.
Reconciliation of U.S. GAAP to Adjusted Results:
In this press release, certain non-GAAP financial measures are presented as adjusted numbers. These numbers exclude the effects of non-cash, stock-based employee compensation expense, amortization of product intangible assets, restructuring expenses, and license and milestone payments. See the attached "Reconciliation of GAAP Net Income (Loss) to Adjusted Net Income" for a detailed explanation of the amounts excluded and included to arrive at adjusted expenses, adjusted operating income, adjusted net income, and adjusted per share amounts for the three-month and nine-month periods ended September 30, 2007 and September 30, 2006. Adjusted or non-GAAP financial measures provide investors and management with supplemental measures of operating performance and trends that facilitate comparisons between periods before, during, and after certain items that would not otherwise be apparent on a GAAP basis. Adjusted financial measures are not, and should not be, viewed as a substitute for GAAP results. We define adjusted diluted earnings per share amounts as adjusted net income divided by the GAAP weighted average number of diluted shares outstanding. Our definition of these adjusted financial measures may differ from similarly named measures used by others.
2007 Financial Outlook
Based on its best-in-class profile and demand trends, the Company currently expects Aloxi sequential sales growth of approximately ten percent during the fourth quarter when compared to the third quarter. The Company now expects full year Dacogen sales of at least $115 million.
The Company is maintaining its previous guidance of:
Adjusted SG&A expenses of $140 to $145 million;
Adjusted R&D expenses of approximately $73 million;
Gliadel revenue growth in the single digit range;
Positive adjusted operating income
The adjusted financial outlook for SG&A excludes non-cash stock-based compensation expense. The adjusted financial outlook for R&D excludes non-cash stock-based compensation expense and license and milestone payments. Adjusted operating income additionally excludes amortization of product intangible assets and restructuring costs. We have excluded these expenses because their amount and significance cannot readily be determined at this time.
Conference Call & Webcast Information
MGI PHARMA will broadcast its quarterly investor conference call live over the Internet today, Wednesday, October 17, 2007 at 5:00 p.m. Eastern Time. The Company's executive management team will review third quarter 2007 financial results, discuss operations, and provide guidance on MGI PHARMA's business outlook. All interested parties are welcome to access the webcast via the Company's Website at www.mgipharma.com. The audio webcast will be archived on the Company's Website through Wednesday, October 24, 2007.<<
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For some reason, though, Brean Murray is bucking the tide with a downgrade to hold since earnings. I presume this is from everyone's pick as the most ethical analyst biotech investors have ever seen, Jonathan Aschoff. Slimy though he is, his calls have been better than many others. Wonder what his rationale is?
Out, myself (sold puts expired worthless last month, never saw another entry since), but happily having my Mom hold her shares for the long haul. Wouldn't shock me to see MOGN taken out within a year.
Cheers, Tuck |
