Alkermes Raises FY23 Outlook Following Arbitration Award from Janssen Agreements
Alkermes plc (NASDAQ: ALKS) increased its FY23 outlook by $425 million to reflect a final award the company received from arbitration proceedings related to two licensing agreements with Janssen Pharmaceutica N.V., a subsidiary of Johnson & Johnson (NYSE: JNJ).
The updated guidance reflects the payment of back royalties of ~$194 million related to 2022 U.S. net sales of the long-acting Invega products and Cabenuva and anticipated royalty revenues related to 2023 sales.
"We are gratified to have the final resolution in this arbitration," Alkermes Chief Executive Richard Pops said. "This outcome reestablishes significant cash flows to Alkermes, provides strategic capital to our balance sheet, and strengthens our longer-term financial profile by clarifying the distinct royalty term for each product covered by the license agreements."
The revised forecasts for FY23 revenue stand at $1.55 billion - $1.68 billion, up from prior guidance of $1.13 billion - $1.25 billion versus the consensus of $1.32 billion.
The company sees adjusted EPS of $1.34 – $1.57 compared to $0.00 – $0.23 expected earlier and the consensus of $0.42.
The company is also entitled to future royalty revenues from Janssen related to sales of long-acting Nvega and Cabenuva in 2024 and beyond.
Alkermes reiterated its non-GAAP net income and EBITDA margins for 2024 at 25% and 20%.
Also, it reaffirmed those figures for 2025 at 30% and 25%, respectively, excluding the royalty revenues due from Janssen.
Price Action: ALKS shares are up 2.60% at $30.23 on the last check Tuesday.
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