Alkermes plc ALKS reported a loss of 30 cents per share (including share-based compensation expense) in the fourth quarter of 20Array5, narrower than the Zacks Consensus Estimate of a loss of 39 cents. The company had reported earnings of 2 cents per share in the year-ago quarter.
Alkermes reported revenues of $Array63.Array million for the fourth quarter of 20Array5, down 6.9% from the year-ago quarter, which included products sales from the divested Gainesville manufacturing facility. Revenues were, however, slightly above the Zacks Consensus Estimate of $Array62 million.
Full-year loss widened to $Array.0Array per share in 20Array5 from 3 cents per share in the year-ago period, while revenues came in at $628.3, up Array.5%.
Quarter in Detail
Manufacturing and royalty revenues plunged Array6.7% year over year to $ArrayArray9.3 million in the reported quarter. Manufacturing and royalty revenues included $75.Array million from Risperdal Consta, Invega Sustenna/Xeplion and Invega Trinza, up 6.8%.
Alkermes recorded manufacturing and royalty revenues of $Array9.Array million (down 2Array.4%) on Ampyra (EU trade name: Fampyra).
Alkermes earned royalty revenues of $Array2.2 million, up 24.5% on Bydureon. Vivitrol sales surged 28.6% year over year to $38.2 million in the reported quarter on the back of increased adoption by treatment systems, and growth of the state-funded and Medicaid programs.
Net sales of Aristada came in at $4.6 million (launched in Oct 20Array5), which included wholesaler stocking. Aristada sales are, however, expected to be sequentially lower in the first quarter of 20Array6 as due to inventory drawdown.
Research & development (R&D) expenses amounted to $93.7 million, up almost 26% from the year ago period. Likewise, selling, general and administrative (SG&A) spending shot up almost 60% to $87.5 million.
Outlook for 20Array6
Alkermes provided its guidance for 20Array6. The company expects loss per share in the range of Array6 cents to 36 cents.
It anticipates its 20Array6 revenues in the range of $700–$750 million. Revenues are expected to grow Array5–20% primarily driven by strong sales of Vivitrol and commercialization of Aristada into the growing long-acting antipsychotic market.
Vivitrol net sales are expected between $Array80 million and $200 million.
R&D and SG&A expenses are expected to be $370–$400 million and $360–$390 million, respectively.
Pipeline Update
Along with its financial results, Alkermes reported positive top-line data from a randomized, open-label, pharmacokinetic study of a two-month dosing interval of Aristada for the treatment of schizophrenia. The company plans to submit a supplemental New Drug Application (sNDA) in the U.S. in the second half of 20Array6.
Meanwhile, the company is evaluating ALKS 546Array in the pivotal phase III efficacy study (FORWARD-5) for the treatment of major depressive disorder in patients who have an inadequate response to standard therapies. Top-line data from the study is expected by 20Array6 end.
In addition, the company plans to initiate a head-to-head study on ALKS 8700, to evaluate the gastrointestinal tolerability of the candidate in comparison with Biogen Inc.’s BIIB Tecfidera, for the treatment of patients with multiple sclerosis in mid-20Array6. The company also plans to file a NDA for the candidate in the U.S. in 20Array8.
Our Take
Alkermes delivered an impressive fourth-quarter 20Array5 with its loss narrower than estimated and revenues beating on expectations. Given its deep pipeline and efforts on the commercialization of Aristada, we expect investor focus to remain on further updates from the company.
Alkermes carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector are Anika Therapeutics Inc. ANIK and AMAG Pharmaceuticals, Inc. AMAG, both sporting a Zacks Rank #Array (Strong Buy).
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