EXHIBIT 99.1
Cubist Pharmaceuticals 3rd Quarter Total Net Revenues Up 28%
Total Net Revenues $143.5 Million; Net Product Revenues $141.6 Million
Earnings Conference Call & Webcast Today (With Slides) at 5:00 pm ET
Lexington, Mass., Oct. 15, 2009 — Cubist Pharmaceuticals, Inc. (NASDAQ: CBST) today announced results for the third quarter ended September 30, 2009.
Third Quarter 2009 Highlights:
· 3Q09 Total net revenues up 28% vs. 3Q08
· 3Q09 Total net revenues up 10% vs. 2Q09
· 3Q09 GAAP EPS of 42 cents
· 3Q09 non-GAAP EPS of 65 cents
With three quarters of 2009 revenue recorded, Cubist has tightened its full year 2009 guidance for CUBICIN U.S. net revenue to between $520 and $525 Million, which is within the range the company announced in January. Cubist’s updated guidance for the full year would represent CUBICIN U.S. net revenue growth of at least 25%.
“Today we have reported another strong quarter”, said Michael Bonney, President and CEO of Cubist. “We continue to make great progress toward our goal of building the world’s leading company focusing on therapies for acutely ill patients. Our strong top and bottom line results have been achieved in an environment that has been tough for many branded pharmaceuticals. Cubist’s top line performance reflects the unique strengths of our anti-MRSA agent CUBICIN as well as the expertise of our acute care medical and commercial organizations. Our four development programs and candidates are all progressing toward important data and decision points in the next 3 to 9 months.”
Net Income
Net income for the third quarter ended September 30, 2009, on a GAAP basis, was $25.4 million, or $0.44 and $0.42 per basic and diluted share, respectively, as compared to net income of $25.0 million, or $0.44 per basic and diluted share for the third quarter ended September 30, 2008.
Cubist’s non-GAAP net income for the third quarter ended September 30, 2009 was $43.2 million, or $0.75 and $0.65 per basic and diluted share, respectively, as compared to non-GAAP net income of $31.1 million, or $0.55 and $0.48 per basic and diluted share, respectively, for the third quarter ended September 30, 2008. A reconciliation between GAAP and non-GAAP net income is provided in the Condensed Consolidated Statement of Operations Non-GAAP table included with this release.
As of September 30, 2009, Cubist had $519.8 million in cash, cash equivalents and investments. The total number of Cubist’s common shares outstanding as of September 30, 2009 was 57,912,625.
Pipeline Update
· RSV Co-development program with Alnylam:
In collaboration with Alnylam, Cubist is in the final stages of evaluating all data for RSV-01 and second generation candidates. The co-development partners will determine next steps in a path forward for development of a potential RSV therapy in pediatrics as well as in adults by year end.
· Two antibiotic candidates now in Phase 1
In the first half of 2010 Cubist anticipates making important Phase 2 decisions on our two antibiotic candidates now in Phase 1 studies—an IV antibiotic in development for the treatment of infections caused by multi-drug-resistant Gram-negative infections and an oral antibiotic in development as treatment for clostridium difficile associated diarrhea, or CDAD. Key input for these decisions will be safety data from the Phase 1 single- and multiple-ascending dose studies which should be available the first half of next year.
· Ecallantide, Phase 2 trials proceeding smoothly
During 2010 Cubist anticipates a number of important milestones for the company’s Phase 2 candidate, ecallantide, in-licensed from Dyax last year and being developed by Cubist for the reduction of blood loss during on-pump cardiac surgery. Earlier this year, Cubist initiated both CONSERV™ 1 in the U.S. and CONSERV™ 2 in the EU. Enrollment is proceeding smoothly. The company anticipates that data from these trials will be unblinded early in 2010 with preparation to follow for end-of-Phase 2 meetings with the U.S. and EU regulatory bodies.
Use of Non-GAAP Financial Measures
Cubist uses non-GAAP net income and non-GAAP net income per share data to improve its analysis of operational results and trends. Cubist’s management also uses these non-GAAP figures to make financial and operational decisions as these numbers exclude non-operational activities and because management believes these measures are useful to investors because they provide greater transparency regarding Cubist’s operating performance. These measures should not be considered an alternative to measurements required by GAAP, such as net income and net income per share, and should not be considered measures of our liquidity. In addition, these non-GAAP measures are unlikely to be comparable with non-GAAP information provided by other companies. A reconciliation between non-GAAP financial measures and GAAP financial measures are included in the tables accompanying this press release after the unaudited condensed consolidated financial statements.
Conference Call and Webcast Information
Teleconference Information:
Event Date: 10/15/2009
Event Time: 5:00 PM Eastern
Event Title: Third Quarter 2009 Earnings Call
Participant Dial-In Numbers: 877-407-8289
For more information: http://www.investorcalendar.com/IC/CEPage.asp?ID=149453
Replay / archive access is here:
(877) 660-6853 (Toll free)
(201) 612-7415 (Local / Int’l)
Acct. #: 351
Conference ID: 332096
About Cubist
Cubist Pharmaceuticals, Inc. is a biopharmaceutical company focused on the research, development, and commercialization of pharmaceutical products that address unmet medical needs in acutely ill patients. In the U.S., Cubist markets CUBICIN® (daptomycin for injection), the first antibiotic in a new class of anti-infectives called lipopeptides. In July 2008, Cubist entered into an agreement with AstraZeneca to promote their established antibiotic, MERREM® I.V. (meropenem for injection) in the U.S. The Cubist product pipeline includes ecallantide, a recombinant human protein in Phase 2 clinical trials — CONSERV™-1 and CONSERV™-2 — for the reduction of blood loss during on pump cardiac surgery, and two Phase 1 programs that address unmet medical needs, one in CDAD (Clostridium difficile-associated diarrhea) and the other in multi-drug resistant (MDR) Gram-negative infections. In addition, the Company, in collaboration with Alnylam Pharmaceuticals, Inc. (Cambridge, MA), has a pre-IND and a Phase 2 program underway for novel treatments for respiratory syncytial virus infections using Alnylam’s RNA-interference technology. Cubist is headquartered in Lexington, MA. Additional information can be found at Cubist’s web site at www.cubist.com.
This press release contains forward-looking statements regarding CUBICIN performance and our pipeline programs. There are many factors that could cause actual results to differ materially from those in these forward-looking statements. These factors include the following: the level of acceptance of CUBICIN by physicians, patients, third-party payors and the medical community; any changes in the current or anticipated market demand or medical need for CUBICIN; any unexpected adverse events related to CUBICIN, particularly as CUBICIN is used in the treatment of a growing number of patients around the world; the results of the patent infringement lawsuit that Cubist has filed against Teva Parenteral Medicines, Inc. and its affiliates in response to Teva’s Abbreviated New Drug Application, or ANDA, with the U.S. Food and Drug Administration, or FDA, regarding CUBICIN and any litigation related thereto, and any other litigation that we file to defend and/or assert our patents; whether or not additional third parties may seek to market generic versions of our products by filing ANDAs with the FDA and the results of any litigation that we file to defend and/or assert our patents against such companies; the effectiveness of our sales force and our sales force’s ability to access targeted physicians; the continued growth of the market into which we sell CUBICIN; competition in the markets in which we and our partners market CUBICIN, including marketing approvals for new products that will be competitive with CUBICIN; the ability of our third party manufacturers, including our single source provider of API, to manufacture sufficient quantities of CUBICIN in accordance with Good Manufacturing Practices and other requirements of the regulatory approvals for CUBICIN and at an acceptable cost; the effect that the results of ongoing or future clinical trials of CUBICIN may have on its acceptance in the medical community; our ability to successfully develop our pipeline product candidates; whether the FDA accepts proposed clinical trial protocols in a timely manner for additional studies of CUBICIN or any other drug candidate we seek to enter into clinical trials; our ability to conduct successful clinical trials in a timely manner; legislative and policy changes in the U.S. and other jurisdictions where our products are sold that may affect the ease of getting a new product or a new indication approved; changes in government reimbursement for our or our competitors’ products; our dependence upon collaborations with our partners and our partners’ ability to execute on development and regulatory expectations; our ability,
and our partners’ ability, to protect the proprietary technologies and intellectual property related to our product candidates; and a variety of risks common to our industry, including ongoing regulatory review, securing adequate supplies of drug product and drug substance of our products and product candidates on a timely basis, public and investment community perception of the industry, legislative or regulatory changes, and our ability to attract and retain talented employees. Drug development involves a high degree of risk. Success in pre-clinical trials or early stage clinical trials does not mean that later stage trials will be successful.
Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in Cubist’s recent annual and quarterly reports with the Securities and Exchange Commission, including those factors discussed under the caption “Risk Factors” in such filings, which are incorporated in this press release by this reference.
Forward-looking statements speak only as of the date of this release, and Cubist undertakes no obligation to update or revise these statements, except as may be required by law.
Cubist and CUBICIN are registered trademarks of Cubist Pharmaceuticals, Inc.
AstraZeneca and MERREM are registered trademarks of the AstraZeneca group of companies.
Contacts: |
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Cubist Pharmaceuticals, Inc. | Weber Shandwick |
Eileen C. McIntyre | Tara Murphy |
Senior Director, Corporate Communications | (617) 520-7045 |
(781) 860-8533 | tara.murphy@webershandwick.com |
eileen.mcintyre@cubist.com |
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CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED
(in thousands)
|
| September 30, |
| December 31, |
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| 2009 |
| 2008 |
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| (as adjusted) |
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ASSETS |
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Cash, cash equivalents and investments |
| $ | 519,783 |
| $ | 417,945 |
|
Accounts receivable, net |
| 56,380 |
| 43,162 |
| ||
Inventory |
| 22,980 |
| 21,958 |
| ||
Property and equipment, net |
| 69,656 |
| 66,819 |
| ||
Deferred tax assets, net |
| 79,008 |
| 102,247 |
| ||
Other assets |
| 32,857 |
| 37,010 |
| ||
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|
|
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Total assets |
| $ | 780,664 |
| $ | 689,141 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Accounts payable and accrued expenses |
| $ | 69,210 |
| $ | 79,584 |
|
Deferred revenue |
| 26,774 |
| 21,340 |
| ||
Debt and other long-term liabilities, net |
| 245,600 |
| 235,890 |
| ||
Total liabilities |
| 341,584 |
| 336,814 |
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Total stockholders’ equity |
| 439,080 |
| 352,327 |
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Total liabilities and stockholders’ equity |
| $ | 780,664 |
| $ | 689,141 |
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CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
(in thousands, except share and per share data)
|
| Three months ended |
| Nine months ended |
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| September 30, |
| September 30, |
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|
| 2009 |
| 2008 |
| 2009 |
| 2008 |
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| (as adjusted) |
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| (as adjusted) |
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Revenues: |
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U.S. product revenues, net |
| $ | 137,660 |
| $ | 109,199 |
| $ | 376,180 |
| $ | 294,623 |
|
International product revenues |
| 3,928 |
| 1,426 |
| 8,877 |
| 5,233 |
| ||||
Service revenues |
| 1,500 |
| 1,418 |
| 9,050 |
| 1,418 |
| ||||
Other revenues |
| 446 |
| 392 |
| 1,316 |
| 1,212 |
| ||||
Total revenues, net |
| 143,534 |
| 112,435 |
| 395,423 |
| 302,486 |
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Costs and expenses: |
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Cost of product revenues |
| 30,771 |
| 23,523 |
| 83,329 |
| 65,573 |
| ||||
Research and development |
| 35,527 |
| 28,629 |
| 118,440 |
| 96,186 |
| ||||
Sales and marketing |
| 18,883 |
| 22,223 |
| 60,020 |
| 64,393 |
| ||||
General and administrative |
| 12,857 |
| 9,341 |
| 36,446 |
| 31,295 |
| ||||
Total costs and expenses |
| 98,038 |
| 83,716 |
| 298,235 |
| 257,447 |
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Operating income |
| 45,496 |
| 28,719 |
| 97,188 |
| 45,039 |
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Other income (expense), net |
| (4,170 | ) | (2,363 | ) | (12,492 | ) | (9,463 | ) | ||||
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Income before income taxes |
| 41,326 |
| 26,356 |
| 84,696 |
| 35,576 |
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Provision for income taxes |
| 15,947 |
| 1,387 |
| 27,765 |
| 2,153 |
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Net income |
| $ | 25,379 |
| $ | 24,969 |
| $ | 56,931 |
| $ | 33,423 |
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Basic net income per common share |
| $ | 0.44 |
| $ | 0.44 |
| $ | 0.99 |
| $ | 0.59 |
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Diluted net income per common share |
| $ | 0.42 | (1) | $ | 0.44 | (1) | $ | 0.98 | (1) | $ | 0.58 | (2) |
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Shares used in calculating: |
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Basic net income per common share |
| 57,842,403 |
| 56,761,058 |
| 57,673,057 |
| 56,458,964 |
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Diluted net income per common share |
| 68,534,597 |
| 67,960,170 |
| 68,322,580 |
| 57,857,547 |
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(1) | Includes add back of interest expense, debt issuance costs and debt discount amortization on 2.25% notes to income, net of tax effect |
(2) | Includes add back of interest expense, debt issuance costs, debt discount amortization and net loss on repurchase of 2.25% notes to income, net of tax effect |
CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - NON-GAAP
UNAUDITED
(in thousands, except share and per share data)
|
| Three months ended |
| Nine months ended |
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| September 30, |
| September 30, |
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|
| 2009 |
| 2008 |
| 2009 |
| 2008 |
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GAAP net income |
| $ | 25,379 |
| $ | 24,969 |
| $ | 56,931 |
| $ | 33,423 |
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Non-cash stock-based compensation expense |
| 3,710 |
| 3,030 |
| 10,194 |
| 8,864 |
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Non-cash debt discount amortization |
| 3,332 |
| 3,065 |
| 9,790 |
| 9,417 |
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Ecallantide licensing fees |
| — |
| — |
| — |
| 17,500 |
| ||||
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Upfront payment related to Alnylam collaboration |
| — |
| — |
| 20,000 |
| — |
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Non-cash tax expense |
| 13,450 |
| — |
| 23,420 |
| — |
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Non-cash loss on disposal of assets |
| — |
| — |
| — |
| 2,323 |
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Income tax effect of Non-GAAP adjustments |
| (2,647 | ) | — |
| (14,326 | ) | — |
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Non-GAAP proforma net income |
| $ | 43,224 |
| $ | 31,064 |
| $ | 106,009 |
| $ | 71,527 |
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Non-GAAP basic net income per common share |
| $ | 0.75 |
| $ | 0.55 |
| $ | 1.84 |
| $ | 1.27 |
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Non-GAAP diluted net income per common share |
| $ | 0.65 | (1) | $ | 0.48 | (1) | $ | 1.61 | (1) | $ | 1.09 | (2) |
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Shares used in calculating: |
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Non-GAAP basic net income per common share |
| 57,842,403 |
| 56,761,058 |
| 57,673,057 |
| 56,458,964 |
| ||||
Non-GAAP diluted net income per common share |
| 68,534,597 |
| 67,960,170 |
| 68,322,580 |
| 67,832,329 |
| ||||
(1) | Includes add back of interest expense and debt issuance costs on 2.25% notes to income, net of tax effect |
(2) | Includes add back of interest expense, debt issuance costs and net loss on repurchase of 2.25% notes to income, net of tax effect |
