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Alkermes Reports Earnings for Q4

Zacks Equity Research

Alkermes plc’s (ALKS) fourth quarter of fiscal 2013 (ended Mar 31, 2013) adjusted earnings (including stock-based compensation expense) of 21 cents per share compared favorably to the year-ago loss of 13 cents per share.  Results in the reported quarter were aided by higher revenues and lower operating expenses. The Zacks Consensus Estimate hinted at earnings of 18 cents per share.

Total revenue for the fourth quarter of fiscal 2013 jumped 25.2% year over year to $163.4 million. The increase in total revenues during the reported quarter was primarily driven by growth of the company’s key products. Revenues surpassed the Zacks Consensus Estimate of $127 million.

For full year fiscal 2013, Alkermes’ adjusted earnings came in at 49 cents per share, below the Zacks Consensus Estimate of 85 cents. The company suffered a loss of approximately 36 cents in fiscal 2012.

Total revenue in fiscal 2013 jumped 48% year over year to $575.5 million. Revenues surpassed the Zacks Consensus Estimate of $535 million.  We note that fiscal 2013 was the first full fiscal year following Alkermes’ purchase of Elan Corporation’s (ELN) Elan Drug Technologies (EDT) unit. The EDT unit was purchased in Sep 2011.

Fiscal 2013 Results

In fiscal 2013, Alkermes recorded $197 million (up 5.7% year over year) of manufacturing and royalty revenues from its long-acting atypical antipsychotic franchise comprising Risperdal Consta and Invega Sustenna/Xeplion. These drugs are marketed by Johnson & Johnson (JNJ).

Alkermes recorded manufacturing and royalty revenues of $65 million (up 164% year over year) in fiscal 2013 from Ampyra (EU trade name: Fampyra). Alkermes earned royalty of $16.4 million on revenues of type II diabetes treatment Bydureon.

Vivitrol, a legacy Alkermes product, performed well in fiscal 2013. Sales of the product climbed approximately 41% year over year to $58.1 million.

During fiscal 2013, Alkermes also earned revenues from TriCor 145 ($37.5 million) and Ritalin LA/Focalin XR franchise ($40.3 million) and Verelan ($23.8 million). Reported total expenses were $493.7 million in fiscal 2013, up from the year-ago figure of $478.3 million.

Other Details

Apart from announcing earnings results, Alkermes announced a change in its fiscal year-end from Mar 31 to Dec. 31. The company provided its outlook for the 9-month period -- Apr 2013 to Dec 2013. The company expects adjusted earnings for the period to be in the range of $0.61 - $0.75 per share. Revenues for the 9-month period are projected in the range of $395 - $425 million.

Alkermes, a biopharmaceutical company, carries a Zacks Rank #2 (Buy). Alexion Pharmaceuticals (ALXN) is another stock in the biopharma space, which carries a Zacks Rank #2.

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