Mallinckrodt plc (MNK), a leading global specialty pharmaceuticals business, today announced financial guidance for its fiscal year ending September 26, 2014.
For fiscal 2014, the company’s annual net sales are expected to be in the range of $2.15 billion to $2.25 billion on an operational basis, which excludes the impact of fluctuations in foreign currency exchange rates1. Net sales for the Specialty Pharmaceuticals segment are expected to be in the range of $1.22 billion to $1.27 billion. This forecast includes net sales of at least $120 million for the company’s generic version of Concerta® (Methylphenidate HCI) extended-release tablets USP (CII). Net sales for the Global Medical Imaging segment are expected to be in the range of $885 million to $930 million.
Also for fiscal 2014, Mallinckrodt expects adjusted diluted earnings per share (EPS)2 to be in the range of $2.45 to $2.65. This range reflects a weighted average, diluted share count of 60.0 million. The non-GAAP effective tax rate is expected to be between 26% and 29%. Capital expenditures are forecasted to be in the range of $140 million to $160 million. This financial guidance does not include any potential material acquisitions or other business development activities.
“We are pleased with the progress Mallinckrodt is making toward becoming a leading global specialty pharmaceuticals company. Fiscal 2014, our first full year as an independent public company, will be an important one as we advance new branded products through the regulatory process and make strategically important investments in our go-to-market capabilities, ” said Mark Trudeau, President and CEO of Mallinckrodt. “Beyond building our pipeline and marketing capabilities in specialty pharmaceuticals, we remain committed to becoming more efficient, as demonstrated by the three-year restructuring program we announced in August 2013.”
Mallinckrodt’s low-risk, high-productivity approach to R&D will remain a focus and source of future growth for the company. The current development pipeline contains various products and product candidates resulting from the reformulation of existing molecules for the treatment of pain and for treatments in complementary therapeutic areas. The following product candidates in the development pipeline represent the most significant near-term commercial opportunities in the company’s Brands business.
MNK-795 is an investigational, extended-release oral formulation of oxycodone and acetaminophen that has been studied for the management of moderate to severe acute pain where the use of an opioid analgesic is appropriate. The tablet was designed using technology with immediate- and extended-release components and potentially tamper-resistant properties. In July 2013 the U.S. Food and Drug Administration (FDA) accepted for filing the New Drug Application (NDA) for MNK-795 and granted priority review.
MNK-155 is a reformulation of hydrocodone and acetaminophen. The formulation includes certain tamper-resistant characteristics designed to deter particular types of abuse. MNK-155 entered Phase III clinical trials in the first half of fiscal 2013. Completion of the clinical program and an NDA filing for MNK-155 is expected by the end of fiscal 2014.
MNK-395 is a 2% formulation of diclofenac topical solution that has been studied in twice-daily administration for the potential indication of the treatment of pain associated with osteoarthritis of the knee. The FDA accepted for filing the NDA for MNK-395 in August 2013.
2014 Mallinckrodt Fiscal Year Guidance (excluding foreign currency impact)
|Adjusted diluted EPS||$2.45 to $2.65|
|Total company net sales||$2.15 billion to $2.25 billion|
|Specialty Pharmaceuticals net sales||$1.22 billion to $1.27 billion|
|Global Medical Imaging net sales||$885 million to $930 million|
|Methylphenidate ER net sales||At least $120 million|
|Non-GAAP effective tax rate||26% to 29%|
|Capital expenditures||$140 million to $160 million|
Webcast and Conference Call
The company will hold a conference call for investors today, October 16, 2013, beginning at 8:30 a.m. U.S. Eastern Daylight Time. The call can be accessed in three ways.
- At the Mallinckrodt website: http://mallinckrodt.com/investor_relations.aspx
- By telephone: For both “listen-only” participants and those who wish to take part in the question-and-answer portion of the call, the telephone dial-in number in the U.S. is 800-688-0836. For participants outside the U.S., the dial-in number is 617-614-4072. The access code for all callers is 12188938.
- Through an audio replay: A replay of the call will be available beginning at 12:30 p.m. U.S. Eastern Daylight Time on October 16, 2013, and ending at 12:59 a.m. U.S. Eastern Daylight Time on October 23, 2013. The dial-in number for U.S. participants is 888-286-8010. For participants outside the U.S., the replay dial-in number is 617-801-6888. The replay access code for all callers is 51623490.
Mallinckrodt is a leading global specialty pharmaceuticals business that develops, manufactures, markets and distributes specialty pharmaceutical products and medical imaging agents. The company’s Specialty Pharmaceuticals segment includes branded and generic drugs, and the Global Medical Imaging segment includes contrast media and nuclear imaging agents. Mallinckrodt has approximately 5,500 employees worldwide with sales in roughly 70 countries. To learn more about Mallinckrodt, please visit www.mallinckrodt.com.
(2)NON-GAAP FINANCIAL MEASURES
This press release contains financial measures, including adjusted diluted EPS and operational growth, which are considered “non-GAAP” financial measures under applicable U.S. Securities and Exchange Commission rules and regulations.
Adjusted diluted EPS represents diluted EPS prepared in accordance with accounting principles generally accepted in the United States (GAAP), adjusted for amortization; discontinued operations; separation costs; restructuring charges, net; immediately expensed up-front and milestone payments; acquisition-related costs; and non-cash impairment charges.
Operational growth measures the change in net sales between current- and prior-year periods using a constant currency, the exchange rate in effect during the applicable prior-year period. This measure is one of the performance metrics that determines management incentive compensation.
We have provided these non-GAAP financial measures because they are used by management, along with financial measures in accordance with GAAP, to evaluate our operating performance. In addition, we believe that they will be used by certain investors to measure our operating results. Management believes that presenting these non-GAAP measures provides useful information about our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
These non-GAAP measures should be considered supplemental to and not a substitute for financial information prepared in accordance with GAAP. The company’s definition of these non-GAAP measures may differ from similarly titled measures used by others.
Because non-GAAP financial measures exclude the effect of items that will increase or decrease the company’s reported results of operations, management strongly encourages investors to review the company’s consolidated financial statements and publicly filed reports in their entirety.
Any statements contained in this communication that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements about future financial condition and operating results, economic, business, competitive and/or regulatory factors affecting our business. Any forward-looking statements contained herein are based on our management's current beliefs and expectations, but are subject to a number of risks, uncertainties and changes in circumstances, which may cause actual results or company actions to differ materially from what is expressed or implied by these statements. The factors that could cause actual future results to differ materially from current expectations include, but are not limited to, our ability to receive procurement and production quotas granted by the U.S. Drug Enforcement Administration, our ability to obtain and/or timely transport molybdenum-99 to our technetium-99m generator production facilities, customer concentration, cost-containment efforts of customers, purchasing groups, third-party payors and governmental organizations, our ability to successfully develop or commercialize new products, our ability to protect intellectual property rights, competition, our ability to integrate acquisitions of technology, products and businesses, product liability losses and other litigation liability, the reimbursement practices of a small number of large public or private issuers, complex reporting and payment obligation under healthcare rebate programs, changes in laws and regulations, conducting business internationally, foreign exchange rates, material health, safety and environmental liabilities, litigation and violations and information technology infrastructure. These and other factors are identified and described in more detail in the “Risk Factors” section of the Form 10 Registration Statement, as amended. We disclaim any obligation to update these forward-looking statements other than as required by law.
1 Total company net sales includes approximately $47 million net sales to the company’s former parent, which are not included in either reporting segment.
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