4Q EARNINGS: Celgene sales boosted by cancer drug demand
This article was originally published in Scrip
Celgene’s sales jumped 21% in the fourth quarter, fueled by demand for the company’s biggest drug, Revlimid, and other cancer treatments.
Sales rose to $1.76 billion in the quarter, better than analysts expected. The US biotech company reported a 14% rise in operating profit to $1.51 a share, slightly less than Wall Street expectations.
Net income dropped 19% in the quarter to $214 million, or 50 cents a share, as Celgene spent more on research and development.
Upfront collaboration payments accounted for one of the biggest jumps in spending in the quarter. Celgene reported $227 million in upfront payments compared with less than $60 million in the year-earlier period. For the year, Celgene reported almost $576 million in upfront collaboration payouts, compared with about $190 million in 2012.
“We’ve got a unique strategy going with respect to how we’re approaching business development,” chief financial officer Jacqualyn Fouse told investors on a quarterly conference call January 30. “It’s going to pay off very nicely from a strategy standpoint. In 2013, we had significantly more activity than we have had in prior years.”
Celgene lists more than 20 business development partners involved in R&D projects. Many of them are small companies, such as Acceleron Pharma.
The blood cancer drug Revlimid (lenalidomide) continues to provide the lion’s share of revenue. In the quarter, Revlimid sales rose 13% to almost $1.14 billion. Full-year sales were $4.28 billion, a 14% increase from 2012.
Sales of the cancer drug Abraxane (paclitaxel) soared 90% in the quarter to $202 million, while Pomalyst (approved last year) reported $121 million in the fourth quarter and $305 million for the year.
Last September, Abraxane was approved for the added use of treatment for late-stage pancreatic cancer, which is driving new sales. (This week, a pair of doctors from Memorial Sloan-Kettering Cancer Center took aim at Abraxane’s cost in a letter to the New England Journal of Medicine.)
Revenue for an older cancer drug, Vidaza (azacitidine), declined 22% to $168 million as that product loses market to generic competition.
Celgene shares fell almost 3% to $153.98 in Nasdaq Stock Market trading after the quarterly results were announced. The stock is up 54% in the past 12 months.