SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: January 26, 2000
MEDIMMUNE, INC.
(Exact name of registrant as specified in its charter)
Commission File Number: 0-19131
Delaware 52-1555759
(State of Incorporation) (I.R.S. Employer
Identification No.)
35 West Watkins Mill Road, Gaithersburg, MD 20878
(Address of principal executive office (Zip Code)
Registrant's telephone number, including area code (301) 417-0770
No Exhibits are being filed with this report.
<PAGE>
ITEM 5. OTHER EVENTS
MedImmune, Inc. reported the information contained in the following press
release dated January 26, 2000.
MEDIMMUNE SETS NEW REVENUE AND EARNINGS RECORDS
1999 PRODUCT SALES NEARLY DOUBLE AND
NET EARNINGS GROW MORE THAN NINEFOLD OVER 1998
(BEFORE ONE-TIME ITEMS)
Fourth Quarter Highlights
- - REVENUES GROW 55 PERCENT TO $173.7 MILLION
- - NET EARNINGS INCREASE 149 PERCENT; REACH $0.69 PER DILUTED SHARE (BEFORE
ONE-TIME ITEMS)
Gaithersburg, MD, January 26, 2000 -- MedImmune, Inc. (Nasdaq: MEDI) today
reported a 55-percent increase in revenues for the 1999 fourth quarter over the
same period in 1998, excluding one-time items and after restating 1998 amounts
to reflect the acquisition of U.S. Bioscience, Inc. Total revenues of $173.7
million in the 1999 fourth quarter included product sales of $171.5 million and
$2.2 million in other revenues. Total revenues of $112.0 million in the 1998
fourth quarter included $109.0 million in product sales and $2.9 million of
other revenues. The primary growth driver for the 1999 quarter was sales of
Synagis(R) (palivizumab), which totaled $151.1 million ($147.3 million in the
United States), a 63-percent increase over the $92.8 million ($90.7 million in
the United States) in sales of Synagis reported in the 1998 fourth quarter. Also
contributing to product sales for the 1999 fourth quarter were $12.4 million in
worldwide sales of CytoGam(R) (Cytomegalovirus Immune Globulin Intravenous
(Human)) and $6.0 million in revenues from worldwide sales of Ethyol(R)
(amifostine), a drug that MedImmune acquired in its merger with U.S. Bioscience.
In the 1998 fourth quarter, sales of CytoGam totaled $9.2 million and Ethyol
revenues totaled $4.5 million.
"1999 was a year of tremendous growth for MedImmune," said Dr. Wayne T.
Hockmeyer, chairman and chief executive officer. "We posted another record year
of revenues and earnings, due primarily to the growing acceptance of Synagis in
the marketplace. We also made significant progress with our pipeline, moving
three new products into the clinic, advancing ongoing clinical studies, and
acquiring several new products through our active in-licensing program and the
merger with U.S. Bioscience. As a result, we begin 2000 with six products on the
market, seven products in clinical testing, and an array of early stage
compounds for future development. We look forward to continuing to build for the
future in 2000."
ADDITIONAL FOURTH QUARTER RESULTS
Excluding One-Time Items
Net earnings for the 1999 fourth quarter grew 149 percent to $49.4 million, or
$0.69 per diluted share, from net earnings of $19.8 million, or $0.30 per
diluted share, in the 1998 fourth quarter. Gross margins in the 1999 fourth
quarter were 77 percent compared to 74 percent in the 1998 fourth quarter.
<PAGE>
Selling, general and administrative costs rose to $41.9 million in the 1999
fourth quarter from $35.5 million in 1998 fourth quarter, due primarily to
higher promotion-related expenses for Synagis(R), partially offset by a
settlement received for the co-promotion of RespiGam(R) (Respiratory Syncytial
Virus Immune Globulin Intravenous (Human)), MedImmune's first generation drug
for RSV, which was largely replaced by Synagis following its launch in the third
quarter of 1998. Research and development expenses increased to $16.2 million in
the fourth quarter 1999 from $11.9 million in fourth quarter 1998 due to a
larger number of active clinical trials. Other operating expenses decreased to
$1.1 million in fourth quarter 1999 from $3.0 million in fourth quarter 1998,
reflecting decreased start-up costs for MedImmune's manufacturing facility in
Frederick, Maryland.
Including One-Time Items
Including one-time transaction expenses associated with the completed
acquisition of U.S. Bioscience, Inc., net earnings for the 1999 fourth quarter
were $34.2 million, or $0.47 per diluted share. In the 1998 fourth quarter, net
earnings were $69.3 million, or $1.02 per diluted share. One-time items for the
1998 fourth quarter included a $47.4 million tax benefit for the reversal of a
valuation allowance for MedImmune's deferred tax asset and a $12.5 million
reduction in revenues for returns of RespiGam.
ANNUAL RESULTS
For the year ended December 31, 1999, MedImmune reported revenues of $383.4
million, a 69-percent increase over 1998 when revenues totaled $227.2 million.
Product sales of $356.8 million accounted for 93 percent of total revenues in
1999 and included $293 million in sales of Synagis, $34.7 million in sales of
CytoGam(R), and $19.6 million in revenues from sales of Ethyol(R). In 1998,
product sales of $183.9 million included $110 million in sales of Synagis, $32.9
million in sales of CytoGam, $19.8 million in sales of RespiGam, and $13.0
million in revenues from sales of Ethyol.
Excluding One-Time Items
Net earnings in 1999 were $68.7 million, or $0.98 per diluted share, compared to
net earnings of $7.3 million, or $0.13 per diluted share in 1998. Gross margins
for 1999 improved to 75 percent from 64 percent in 1998, reflecting the higher
profit margin of Synagis, which accounted for 82 percent of total product sales
in 1999 versus 60 percent in 1998. Selling, general and administrative expenses
in 1999 rose to $118.2 million from $80.9 million in 1998, primarily reflecting
increased promotional and co-promotional expenses related to Synagis, as well as
the impact of a larger organization. Research and development costs increased 41
percent in 1999 to $59.6 million from $42.2 million in 1998, reflecting the
expansion of our clinical development efforts for a larger number of product
candidates. Other expenses for 1999 were $17.4 million, a decrease of 34 percent
from the previous year when other operating expenses totaled $26.2 million.
Including One-Time Items
Including one-time items, net earnings for 1999 were $93.4 million, or $1.33 per
diluted share, compared to net earnings of $47.2 million, or $0.73 per diluted
share in 1998. One-time items in 1999 were related to the acquisition of U.S.
Bioscience. These one-time items included a tax benefit of $41.0 million,
accounted for in the second quarter of 1999, associated with the reversal of the
valuation allowance on U.S. Bioscience's deferred tax asset, and $1.8 million
and $19.4 million of merger related costs accounted for in the third and fourth
quarters of 1999, respectively, net of the related tax effect. The 1998 one-time
items included those discussed above for the fourth quarter of 1998, plus a
<PAGE>
$7.6 million net charge related to RespiGam(R) inventory writedowns and a $10.3
million charge for the impact of Synagis(R) royalty buydowns.
Cash and marketable securities at December 31, 1999 increased to $270.4 million
from $176.9 million at December 31, 1998. During 1999, MedImmune also reduced
its long-term indebtedness to $11.9 million at December 31, 1999 from $87.9
million at December 31, 1998.
OTHER RECENT ACTIVITIES
"Besides significantly growing revenue and earnings during the fourth quarter of
1999, we also took steps to build our overall business that both diversified and
strengthened our core structure," commented Dr. Hockmeyer. "The two key
developments that took place during the fourth quarter were the completion of
our acquisition of U.S. Bioscience, a biotechnology company with a strong focus
in the cancer market, and the approval of our Frederick manufacturing facility
by the U.S. Food and Drug Administration for Synagis. Additionally, the
international rollout of Synagis continued to make progress during the quarter,
and we moved two new vaccine candidates into the clinic. All of these activities
are expected to help continue building MedImmune into a profitable, widely
diversified, fully integrated biopharmaceutical company recognized for its
innovation in bringing meaningful new products to market."
- - On November 23, 1999, MedImmune completed its acquisition of U.S.
Bioscience in a tax-free, stock-for-stock merger, accounted for as a
pooling of interests. Each share of U.S. Bioscience was exchanged for 0.15
shares of MedImmune stock.
- - In December 1999, the FDA approved MedImmune's Frederick manufacturing
facility, allowing the company to begin distributing Synagis manufactured
at that facility, augmenting the supply of Synagis produced at Boehringer
Ingelheim Pharma KG in Biberach, Germany.
- - Synagis has received regulatory approval in 28 countries, including
Switzerland's approval in the fourth quarter and Norway's approval in early
January. Additional regulatory approvals are expected in 2000, as are
additional pricing and reimbursement approvals in various European
countries.
- - MedImmune began Phase 1 clinical trials for two new vaccine candidates: one
to prevent urinary tract infections caused by E. coli and the other to
prevent infection with parvovirus B19. Both studies are expected to be
completed in the second half of 2000.
Synagis(R) is a humanized monoclonal antibody marketed for the prevention of
serious lower respiratory tract disease caused by respiratory syncytial virus in
pediatric patients at high risk of RSV disease (see full prescribing information
at www.medimmune.com/products/synagispi.htm). Ethyol(R) is an intravenous
cytoprotective agent marketed for the reduction of both cumulative renal
toxicity associated with repeated administration of cisplatin in patients with
advanced ovarian cancer or non-small cell lung cancer ("NSCLC") and moderate to
severe xerostomia in patients undergoing post-operative radiation treatment for
head and neck cancer, where the radiation port includes a substantial portion of
the parotid glands (see full prescribing information at
www.usbio.com/research.htm). CytoGam(R) is an intravenous immune globulin
enriched in antibodies against cytomegalovirus (CMV) and is marketed for the
prophylaxis against CMV disease associated with transplantation of kidney, lung,
liver, pancreas, and heart (please see full prescribing information attached and
at www.medimmune.com/products/cytopi1.htm). RespiGam(R) is an intravenous immune
globulin enriched in antibodies against RSV and is marketed for the prevention
of serious lower respiratory tract infection caused by RSV in children under 24
months of age with bronchopulmonary dysplasia (BPD)
<PAGE>
or a history of premature birth (please see full prescribing information
attached and at www.medimmune.com/products/resppi.htm).
MedImmune, Inc. is a fully integrated biotechnology company focused on
developing and marketing products that address medical needs in areas such as
infectious disease, immune regulation and cancer. Headquartered in Gaithersburg,
Maryland, MedImmune has manufacturing facilities in Frederick, Maryland and
Nijmegen, The Netherlands, and an oncology subsidiary in West Conshohocken,
Pennsylvania.
This announcement may contain, in addition to historical information, certain
forward-looking statements that involve risks and uncertainties. Such statements
reflect management's current views and are based on certain assumptions. Actual
results could differ materially from those currently anticipated as a result of
a number of factors, including risks and uncertainties discussed in the
company's filings with the U.S. Securities and Exchange Commission. MedImmune
cautions that RSV disease occurs primarily during the winter months; the company
believes its operating results will reflect that seasonality for the foreseeable
future. The company is also developing several products for potential future
marketing. There can be no assurance that such development efforts will succeed,
that such products will receive required regulatory clearance or that, even if
such regulatory clearance were received, such products would ultimately achieve
commercial success.
-- Tables Follows --
<PAGE>
EXCLUDING ONE-TIME ITEMS
MEDIMMUNE, INC.
SELECTED FINANCIAL INFORMATION
(in thousands, except per share data)
<TABLE>
<CAPTION>
Condensed Consolidated Statements of Operations
Three Months Ended December 31, Year Ended December 31,
------------------------------- -----------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Product sales $ 171,459 $ 109,020 (6) $ 356,815 $ 183,948
Other 2,235 2,931 26,560 43,273
--------- --------- ---------- ---------
173,694 111,951 383,375 227,221
--------- --------- ---------- ---------
Costs and expenses:
Cost of sales 39,371 28,189 90,193 65,548 (1)
Research and development 16,245 11,922 59,565 42,153
Selling, administrative and general 41,939 (7) 35,503 118,155 (7) 80,888 (2)
Other operating expenses 1,096 3,049 17,409 26,245 (3)
--------- --------- ---------- ---------
98,651 78,663 285,322 214,834
--------- --------- ---------- ---------
Interest income, net 2,696 1,094 9,457 5,206
--------- --------- ---------- ---------
Income before income taxes 77,739 34,382 107,510 17,593
Provision for income taxes 28,342 (8) 14,555 (4) 38,762 (5) 10,286 (4)
--------- --------- ---------- ---------
Net earnings $ 49,397 $ 19,827 $ 68,748 $ 7,307
========= ========= ========== ==========
Basic earnings per share $ 0.73 $ 0.34 $ 1.08 $ 0.13
========= ======== ========= =========
Shares used in computing
basic earnings per share 67,606 57,884 63,474 56,776
========= ========= ========== ==========
Diluted earnings per share $ 0.69 $ 0.30 $ 0.98 $ 0.13
========= ======== ========= =========
Shares used in computing
diluted earnings per share 71,941 68,081 70,770 67,049
========= ========= ========== =========
</TABLE>
The above amounts are restated to reflect the merger with U.S. Bioscience and
exclude the one-time impact of significant items as follows:
(1) The net impact of $10.4 million related to the write-down of
RespiGam(R)inventory following FDA approval of Synagis(R
(2) The impact of $2.8 million reimbursement from co-promotion partner related
to writedown of RespiGam inventory
(3) The impact of $10.3 million related to the buy-down of Synagis royalties
(4) The tax benefit of $47.4 million related to the reversal of the valuation
allowance on the Company's deferred tax assets and the tax benefit related
to the other one-time charges
(5) The tax benefit of $41.0 million related to the reversal of the valuation
allowance on U.S. Bioscience's deferred tax assets and the tax benefit
related to the other one-time charges
(6) The impact of $12.5 million related to returns of RespiGam following the
launch of Synagis
(7) The impact of merger and severance related costs associated with the
acquisition of U.S. Bioscience of $21.2 million and $19.4 million for the
year ended and the quarter ended December 31, 1999, respectively
(8) The impact of the tax benefit related to the merger and severance related
costs associated with the acquisition of U.S. Bioscience
<PAGE>
INCLUDING ONE-TIME ITEMS
MEDIMMUNE, INC.
SELECTED FINANCIAL INFORMATION
(in thousands, except per share data)
<TABLE>
<CAPTION>
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
- -----------------------------------------------
Three Months Ended December 31, Year Ended December 31,
1999 1998 1999 1998
-------------- ------------- ------ ------
<S> <C> <C> <C> <C>
Revenues:
Product sales $ 171,459 $ 96,540 $ 356,815 $ 183,948
Other 2,235 2,931 26,560 43,273
--------- --------- ---------- ---------
173,694 99,471 383,375 227,221
--------- --------- ---------- ---------
Costs and expenses:
Cost of sales 39,371 28,189 90,193 75,960
Research and development 16,245 11,922 59,565 42,153
Selling, administrative and general 61,373 35,503 139,389 78,060
Other operating expenses 1,096 3,049 17,409 36,495
--------- --------- ---------- ---------
118,085 78,663 306,556 232,668
--------- --------- ---------- ---------
Interest income, net 2,696 1,094 9,457 5,206
--------- --------- ---------- ---------
Income (loss) before income taxes 58,305 21,902 86,276 (241)
Provision (benefit) for income taxes 24,154 (47,428) (7,095) (47,428)
--------- ---------- ----------- ----------
Net earnings $ 34,151 $ 69,330 $ 93,371 $ 47,187
========= ========= ========== ==========
Basic earnings per share $ 0.51 $ 1.20 $ 1.47 $ 0.83
========= ======== ========= =========
Shares used in computing
basic earnings per share 67,606 57,884 63,474 56,776
========= ========= ========== =========
Diluted earnings per share $ 0.47 $ 1.02 $ 1.33 $ 0.73
========= ======== ========= =========
Shares used in computing
diluted earnings per share 71,941 68,081 70,770 67,049
========= ========= ========== =========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONDENSED CONSOLIDATED BALANCE SHEETS
- -------------------------------------
December 31, December 31,
1999 1998
------------- --------------
<S> <C> <C>
Assets:
Cash and marketable securities $ 270,394 $ 176,860
Trade and contract receivables, net 87,780 36,503
Inventory, net 35,996 27,581
Deferred taxes, net 152,122 77,518
Property and equipment, net 87,452 80,256
Other assets 14,680 7,059
---------- ---------
$ 648,424 $ 405,777
========== ============
Liabilities and shareholders' equity:
Accounts payable $ 2,995 $ 4,798
Accrued expenses 93,827 59,970
Other liabilities 2,667 4,533
Long term debt 11,856 87,910
Shareholders' equity 537,079 248,566
---------- ---------
$ 648,424 $ 405,777
========== ============
Common shares outstanding 67,947 58,309
========== =========
</TABLE>
Prior period amounts have been restated to conform with the current presentation
and to reflect the merger with U.S. Bioscience.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDIMMUNE, INC.
---------------
(Registrant
Date: January 31, 2000 By:___________________________
David M. Mott, Vice Chairman and
Chief Financial Officer
