BioMarin Announces Second Quarter 2020 Total Revenue Growth of 11% to $430 million
SAN RAFAEL, Calif., Aug. 4, 2020 /PRNewswire/ --
Financial Highlights (in millions of U.S. dollars, except per share data, unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2020 2019 % Change 2020 2019 % Change
Total Revenues $
429.5 $
387.8 11 $
931.6 $
788.5 18
% %
Net Product
Revenues % %
Marketed by
BioMarin (1) 386.8 373.3 4 820.1 722.5 14
Vimizim Net
Product % %
Revenues 116.7 122.7 (5) 253.9 248.5 2
Kuvan Net
Product % %
Revenues 122.6 113.3 8 244.6 220.2 11
Naglazyme Net
Product % %
Revenues 81.0 98.2 (18) 195.3 185.1 6
Palynziq Net
Product % %
Revenues 40.7 18.8 116 75.3 31.1 142
Brineura Net
Product % %
Revenues 25.8 14.8 74 49.8 27.0 84
Aldurazyme Net
Product % %
Revenues 32.3 5.8 457 88.0 51.1 72
GAAP Net Income
(Loss) $
(29.2) $
(37.4) $
52.2 $
(93.9)
GAAP Net Income
(Loss) per
Share - Basic $
(0.16) $
(0.21) $
0.29 $
(0.53)
GAAP Net Income
(Loss) per
Share -
Diluted $
(0.16) $
(0.21) $
0.28 $
(0.53)
Non-GAAP
Income (2) $
57.4 $
17.1 $
173.9 $
42.2
June 30, December 31,
2020 2019
Cash, cash equivalents and
investments $
1,703.4 $
1,165.8
(1) Net Product Revenues Marketed by
BioMarin is the sum of revenues
from Vimizim, Kuvan, Naglazyme,
Palynziq, Brineura and Firdapse,
each calculated in accordance with
Generally Accepted Accounting
Principles in the United States
(U.S. GAAP). Sanofi Genzyme
(Genzyme) is BioMarin's sole
customer for Aldurazyme and is
responsible for marketing and
selling Aldurazyme to third
parties. Refer to page 9 for a
table showing Net Product Revenues
by product, including Firdapse. In
January 2020, BioMarin divested
the Firdapse assets to a third
party in a sale transaction. The
sale is reflected in the Company's
consolidated financial statements
for the three and six months
ending June 30, 2020; as a result
of the transaction BioMarin will
not recognize Net Product Revenues
from Firdapse in the future.
(2) Non-GAAP Income is defined by the
Company as reported GAAP Net
Income, excluding net interest
expense, provision for (benefit
from) income taxes, depreciation
expense, amortization expense,
stock-based compensation expense,
contingent consideration expense
and, in certain periods, certain
other specified items. Refer to
Non-GAAP Information beginning on
page 10 of this press release for
a complete discussion of the
Company's Non-GAAP financial
information and reconciliations to
the comparable information
reported under U.S. GAAP.
BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) (BioMarin or the Company) today announced financial results for the second quarter ended June 30, 2020.
Net Product Revenues for the second quarter of 2020 increased to $419.0 million, compared to $379.1 million in the second quarter of 2019. The increase in Net Product Revenues was attributed to the following:
-- Aldurazyme Net Product Revenues increased by $26.5 million due to higher
sales volume to Genzyme;
-- Palynziq Net Product Revenues increased by $21.9 million driven by a
combination of revenue from U.S. patients achieving maintenance dosing
and new patients initiating therapy;
-- Brineura Net Product Revenues increased by $11.0 million due in large
part growth in the number of patients in all regions; and
-- Kuvan Net Product Revenues increased by $9.3 million driven primarily by
a U.S. price increase and Kuvan product mix; partially offset by
-- Naglazyme and Vimizim Net Product Revenues combined decreased by $23.2
million primarily due to timing of orders as well as the impact of
missed infusions resulting from the COVID-19 pandemic.
The decrease in GAAP Net Loss for the second quarter of 2020, compared to GAAP Net Loss for the same period in 2019 was primarily due to the following:
-- an increase in gross profit (Total Revenues less Cost of Sales) of $21.2
million primarily driven by higher product sales; and
-- an increase in the benefit from income taxes; partially offset by
-- the effect of the one-time gain recognized in the second quarter of 2019
due to a third party's achievement of a commercial milestone related to
previously sold intangible asset; and
-- higher selling, general and administrative (SG&A) expense related to
pre-commercialization activities for valoctocogene roxaparvovec.
Non-GAAP Income for the second quarter of 2020 increased to $57.4 million, compared to Non-GAAP Income of $17.1 million for the same period in 2019. The increase in Non-GAAP Income for the quarter, compared to the same period in 2019, was attributed to decreased R&D expense and higher gross profit, partially offset by higher SG&A expense.
As of June 30, 2020, BioMarin had cash, cash equivalents and investments totaling approximately $1.7 billion, as compared to $1.2 billion on December 31, 2019.
Commenting on second quarter 2020 results, Jean-Jacques Bienaimé, Chairman and Chief Executive Officer of BioMarin, said, "In the second quarter, BioMarin employees worked collaboratively to ensure access to our critically-important medicines to the people we serve, despite the global impact of COVID-19. In these challenging times, our strong financial results underscore both the essential nature of our products to patients and our ongoing efforts to maintain supply around the world."
Mr. Bienaimé continued, "In the second quarter at the World Federation of Hemophilia Virtual Congress, we were pleased to share the four-year data update from our ongoing Phase 1/2 study, which demonstrated sustained clinical benefit following a single administration of valoctocogene roxaparvovec. All participants in the study received a single administration of valoctocogene roxaparvovec in 2016 and remained off exogenous factor prophylaxis through year four. These data strengthen our confidence in valoctocogene roxaparvovec and the opportunity to address the unmet therapeutic needs of people with severe hemophilia A. With our marketing applications under review in both the United States and Europe, we await the potential approval of valoctocogene roxaparvovec. We believe each of the submissions represent the first time a gene therapy product for any type of hemophilia indication is under review by health authorities. With the outcome of the Priority Review of our BLA anticipated August 21, 2020, our commercial team is preparing to launch what we believe is the most innovative product yet for people with bleeding disorders."
"Another key milestone in the third quarter of this year, representing the culmination of years of clinical study and development, was the July 23 submission of a MAA to the EMA for vosoritide to treat children with achondroplasia. The company remains on track to submit a NDA to the FDA later in the third quarter. Our multi-pronged dossier of data encompasses long-term clinical results in 5 to 18 year-olds from our Phase 2 study, natural history data, the ongoing study of newborns through 5 years, and highly statistically significant placebo-controlled Phase 3 results. The positive results from our vosoritide clinical programs bolster our confidence in the potential for this drug to be the first pharmacological treatment for the underlying cause of achondroplasia. Interest in our clinical studies with vosoritide has been extremely robust, demonstrating that families are keen to seek early treatment for their children."
Mr. Bienaimé concluded, "Despite impact from COVID-19 on our business in the short-term, we remain focused on working towards significant achievements that we believe will drive long-term value. Key milestones for the second half of 2020 include reaching GAAP profitability for a full year for the first time in our history, the potential approval of valoctocogene roxaparvovec, and the pursuit of vosoritide approval. With these exciting possibilities on the horizon, 2020 has the potential to be the most momentous year in our 20-year history."
2020 Full-Year Financial Guidance
GAAP Net Income guidance for 2020 has been updated to include the potential impact of intangible asset transfers between BioMarin entities. These intangible asset transfers are expected to occur in the second half of 2020, and are estimated to result in a one-time, non-cash income tax benefit of approximately $700 million to $900 million. The range acknowledges that the intangible asset transfers have not yet been completed and therefore the final value cannot yet be determined with certainty. The final valuation will be completed when the transactions occur. As a result, full year GAAP net income guidance has been updated to be in the range between $720 million and $980 million. The intangible asset transfers are not expected to impact Non-GAAP income.
Item Provided April 29, 2020 Revised August 4, 2020
Total Revenues (1) $1,850 to $1,950
Unchanged
Vimizim Net Product
Revenues $530 to $570
Unchanged
Kuvan Net Product
Revenues $430 to $480
Unchanged
Naglazyme Net
Product Revenues $360 to $400
Unchanged
Palynziq Net Product
Revenues $160 to $190
Unchanged
Brineura Net Product
Revenues $85 to $115
Unchanged
Cost of Sales (% of 20 to 21
Total Revenues) % %
Unchanged
Research and
Development Expense $675 to $725
Unchanged
Selling, General and
Administrative
Expense $780 to $830
Unchanged
GAAP Net Income $
20 to $
80 $
720 to $
980
Non-GAAP Income (2) $260 to $310
Unchanged
(1) Revenue guidance reflects
BioMarin's projected impact of the
COVID-19 pandemic on its global
revenue sources, mostly in the
form of demand interruptions such
as missed patient infusions and
delayed treatment starts for new
patients. The revenue guidance
assumes stabilization of such
interruptions in late 2020.
(2) All Financial Guidance items are
calculated based on U.S. GAAP with
the exception of Non-GAAP Income/
Loss. Refer to Non-GAAP
Information beginning on page 10
of this press release for a
complete discussion of the
Company's Non-GAAP financial
information and reconciliations to
the corresponding GAAP reported
information.
Key Program Highlights
-- Valoctocogene roxaparvovec gene therapy for severe hemophilia A: On June
17, 2020, the Company provided a four-year update with the 6e13 vg/kg
dose subjects and a three-year update with the 4e13 vg/kg dose subjects
from the ongoing Phase 2 study in a late-breaking oral presentation at
World Federation of Hemophilia Virtual Summit. The results from both
dose cohorts demonstrated that all subjects had remained off
prophylactic Factor VIII treatment since receiving their single dose of
valoctocogene roxaparvovec. In addition, cumulative mean annualized
bleed rates (ABR) remained less than one in both cohorts and below
pre-treatment baseline levels. In the six study participants who were
previously on Factor VIII prophylaxis in the 6e13 vg/kg cohort, the data
showed substantial and sustained reductions in bleeding that required
Factor VIII infusions. During the four years following treatment with
valoctocogene roxaparvovec, the cumulative mean ABR was 0.8, which
represents a 95% reduction from baseline. In the fourth year, the mean
ABR was 1.3 and the median was zero. There was a 96% reduction in mean
Factor VIII usage to 5.4 infusions per year cumulatively over four years
from the baseline of 135.6 infusions per year on Standard of Care
prophylaxis.
-- Similarly, in the six study participants in the 4e13 vg/kg cohort, the
data showed substantial and sustained reductions in bleeding requiring
Factor VIII infusions following treatment with valoctocogene
roxaparvovec. The cumulative mean ABR was reduced by 93% to 0.9 with
continued absence of target joint bleeds in 5 of 6 subjects during the
three years observed, which represents a 93% reduction from baseline.
During the third year of follow-up, the mean ABR was 0.5 and the median
ABR was zero, and 67% or four out of six, of the study participants were
bleed-free. Five out of six participants had no spontaneous bleeds.
There was a 96% reduction in mean Factor VIII usage to 5.7 infusions per
year cumulatively over three years from the baseline of 142.8 infusions
per year. The FDA review of the BLA, under Priority Review, for
valoctocogene roxaparvovec is on-track with a PDUFA target action date
of August 21, 2020. In Europe, the MAA filing remains under accelerated
assessment at this time. However, as communicated on the first quarter
results call, the review procedure was extended by at least 3 months due
to COVID-19 delays. Further, as is the case with most filings that
initially receive accelerated assessment, there is a high possibility
that the MAA will revert to a standard review procedure from accelerated
assessment. Based on these assumptions, the CHMP opinion is expected in
late 2020/early 2021.
-- Vosoritide for children with achondroplasia: On July 23, 2020, the
Company announced that it had submitted the MAA for vosoritide for the
treatment of children with achondroplasia to the EMA. Vosoritide is an
investigational, once daily injection of an analog of C-type Natriuretic
Peptide (CNP). BioMarin plans to submit a vosoritide marketing
application to the FDA later in the third quarter of 2020.
The applications include positive final results from its randomized, double-blind, placebo-controlled Phase 3 study evaluating the efficacy and safety of vosoritide. The placebo-adjusted increased change from baseline in growth velocity after one year of treatment with vosoritide, the primary endpoint, was 1.6 cm/yr (p<0.0001). An ongoing, open-label, Dose Finding Phase 2 study of vosoritide for achondroplasia demonstrated over 54 months that children in cohort 3 (N=10) of the study, at a dose of 15 µg/kg/day, achieved a statistically significant (p< 0.005) cumulative mean additional height gain of 9.0 cm compared to children, matched for age and gender, in a new natural history achondroplasia dataset (N=619). The study enrolled 121 children aged 5 to 14 with achondroplasia, the most common form of disproportionate short stature. The results were consistent across the broad patient population studied. Vosoritide was generally well tolerated with mild-to-moderate injection site reactions being the most frequent adverse event; there were no clinically significant blood pressure decreases.
-- BMN 307 gene therapy product candidate for phenylketonuria (PKU): On
January 13, 2020 the Company announced that both the FDA and the
Medicines and Healthcare Products Regulatory Agency (MHRA) in the U.K.
have granted the Company Investigational New Drug (IND) status and
approved its Clinical Trial Application (CTA), respectively, for BMN
307.
Depending on the ongoing impact of COVID-19, the Company currently believes that dosing in Phearless, the Phase 1/2 study of BMN 307, could begin later in the third quarter. In the meantime, sites are being prepared to open and enroll patients. All subjects participating in the Phearless study will receive product made at commercial scale from BioMarin's award-winning gene therapy manufacturing facility. Both the FDA and EMA have granted BMN 307 Orphan Drug Status.
-- DiNA-001 for MYBPC3 hypertrophic cardiomyopathy (HCM): On May 3, 2020
the Company announced that it had entered into a preclinical
collaboration and license agreement with DiNAQOR AG (DiNAQOR), a gene
therapy platform company, to develop novel gene therapies to treat rare
genetic cardiomyopathies. DiNAQOR will receive an undisclosed upfront
payment and is eligible to receive development, regulatory and
commercial milestones on product sales in addition to tiered royalties
on worldwide sales.
-- BMN 331 gene therapy product candidate for Hereditary Angioedema (HAE):
The Company began IND-enabling studies in July with its third gene
therapy candidate, BMN 331, for the treatment of Hereditary Angioedema
(HAE). BioMarin plans to leverage its broad expertise in developing gene
therapies for severe hemophilia A and PKU to improve efficiencies in the
development process of BMN 331.
-- Vosoritide for the treatment of Genetic Causes of Short Stature (GSS):
In July, an investigator-initiated trial with vosoritide for GSS began
enrolling participants. As previously announced, the Company plans to
study vosoritide for treatment of broader genetic statural abnormalities
starting with genetic short stature (GSS). This study is part of a
research collaboration with Children's National Hospital in Washington,
D.C.
BioMarin will host a conference call and webcast to discuss second quarter 2020 financial results today, Tuesday, August 4, 2020 at 4:30 p.m. ET. This event can be accessed on the investor section of the BioMarin website at www.biomarin.com.
U.S./Canada Dial-in Number: Replay Dial-in Number:
866.502.9859 855.859.2056
International Dial-in Number: Replay International Dial-in
574.990.1362 Number: 404.537.3406
Conference ID: 3285215
Conference ID: 3285215
---
About BioMarin
BioMarin is a global biotechnology company that develops and commercializes innovative therapies for people with serious and life-threatening rare diseases and medical conditions. The Company selects product candidates for diseases and conditions that represent a significant unmet medical need, have well-understood biology and provide an opportunity to be first-to-market or offer a significant benefit over existing products. The Company's portfolio consists of several commercial therapies and multiple clinical and preclinical product candidates.
For additional information, please visit www.biomarin.com.
Forward-Looking Statements
This press release and the associated conference call and webcast contain forward-looking statements about the business prospects of BioMarin Pharmaceutical Inc. (BioMarin), including, without limitation, statements about: the expectations of Total Revenues, Net Product Revenues, Research and Development Expense, Selling, General and Administrative Expense, Cost of Sales, GAAP Net Income, Non-GAAP Income, other specified income statement guidance for the full-year 2020, and our belief that 2020 has the potential to be the most momentous year in BioMarin's 20-year history; the financial performance of BioMarin as a whole, including (i) that BioMarin expects to become profitable on a GAAP basis for the first time in 2020 and (ii) that the COVID-19-related demand interruptions will normalize in late 2020; the timing of BioMarin's clinical development and commercial prospects, including (i) the Company's expectation that it will start dosing patients in the PHEARLESS study in the second half of 2020, the Company's expectation that it will begin IND-enabling studies for BMN 331 for HAE in mid-2020, and the Company's expectation that vosoritide will be studied in broader genetic statural deficiencies with GSS, (ii) BioMarin's clinical studies and trials, (iii) completion of enrollment of those studies and trials, and (iv) announcements of data from those studies and trials; the clinical development and commercialization of BioMarin's product candidates and commercial products, including (i) BioMarin's remaining on track to submit an NDA to the FDA later in the third quarter for vosoritide for children with achondroplasia ,and (ii) the potential approval and commercialization of BioMarin's product candidates, including valoctocogene roxaparvovec for the treatment of severe hemophilia A, including timing of such approval decisions.
These forward-looking statements are predictions and involve risks and uncertainties such that actual results may differ materially from these statements. These risks and uncertainties include, among others: BioMarin's success in the commercialization of its commercial products; results and timing of current and planned preclinical studies and clinical trials, as well as the potential impact of the COVID-19 pandemic on (i) BioMarin's ability to continue such preclinical studies and clinical trials and (ii) the timing of such preclinical studies and clinical trials, and the release of data from those trials; BioMarin's ability to successfully manufacture its commercial products and product candidates; the content and timing of decisions by the FDA, the European Commission and other regulatory authorities concerning each of the described products and product candidates, including the potential impact of the COVID-19 pandemic on the regulatory authorities' abilities to issue such decisions and the timing of such decisions; the market for each of these products; actual sales of BioMarin's commercial products and the impact that the COVID-19 pandemic may have on such sales; the introduction of generic versions of BioMarin's commercial products, in particular generic versions of Kuvan; and those factors detailed in BioMarin's filings with the Securities and Exchange Commission (SEC), including, without limitation, the factors contained under the caption "Risk Factors" in BioMarin's Annual Report on Form 10-Q for the quarter ended March 31, 2020 as such factors may be updated by any subsequent reports. Stockholders are urged not to place undue reliance on forward-looking statements, which speak only as of the date hereof. BioMarin is under no obligation, and expressly disclaims any obligation to update or alter any forward-looking statement, whether as a result of new information, future events or otherwise.
BioMarin®, Brineura®, Kuvan®, Naglazyme®, Palynziq® and Vimizim® are registered trademarks of BioMarin Pharmaceutical Inc., or its affiliates. Aldurazyme® is a registered trademark of BioMarin/Genzyme LLC.
BIOMARIN PHARMACEUTICAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, 2020 and December 31, 2019
(In thousands of U.S. dollars, except per share amounts)
June 30, 2020 December 31,
2019(1)
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $
818,900 $
437,446
Short-term investments 561,472 316,361
Accounts receivable, net 381,215 377,404
Inventory 743,852 680,275
Other current assets 142,127 130,657
Total current assets 2,647,566 1,942,143
Noncurrent assets:
Long-term investments 323,058 411,978
Property, plant and equipment, net 1,010,917 1,010,868
Intangible assets, net 433,381 456,580
Goodwill 196,199 197,039
Deferred tax assets 555,137 549,422
Other assets 135,852 122,009
Total assets $
5,302,110 $
4,690,039
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $
443,202 $
570,621
Short-term convertible debt, net 370,100 361,882
Total current liabilities 813,302 932,503
Noncurrent liabilities:
Long-term convertible debt, net 1,073,202 486,238
Long-term contingent consideration 50,216 50,793
Other long-term liabilities 128,711 98,124
Total liabilities $
2,065,431 $
1,567,658
Stockholders' equity:
Common stock, $0.001 par value: 500,000,000 shares authorized; 181,148,332 and
179,838,114 shares issued and outstanding, respectively. 181 180
Additional paid-in capital 4,885,637 4,832,707
Company common stock held by Nonqualified Deferred Compensation Plan (10,678) (9,961)
Accumulated other comprehensive income 30,050 20,164
Accumulated deficit (1,668,511) (1,720,709)
Total stockholders' equity 3,236,679 3,122,381
Total liabilities and stockholders' equity $
5,302,110 $
4,690,039
(1) December 31, 2019 balances were
derived from the audited
Consolidated Financial
Statements included in the
Company's Annual Report on Form
10-K for the year ended December
31, 2019, filed with the U.S.
Securities and Exchange
Commission (SEC) on February 27,
2020.
BIOMARIN PHARMACEUTICAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Six Months Ended June 30, 2020 and 2019
(In thousands of U.S. dollars, except per share amounts)
Three Months Ended June 30, Six Months Ended June 30,
2020 2019 2020 2019
(unaudited) (unaudited) (unaudited) (unaudited)
REVENUES:
Net product revenues $
419,032 $
379,075 $
908,075 $
773,558
Royalty and other revenues 10,453 8,688 23,479 14,950
Total net revenues 429,485 387,763 931,554 788,508
OPERATING EXPENSES:
Cost of sales 97,967 77,436 209,341 166,618
Research and development 182,139 185,641 324,396 369,232
Selling, general and
administrative 175,412 160,754 362,707 322,912
Intangible asset amortization
and contingent consideration 14,912 20,286 30,589 40,051
Gain on sale of nonfinancial
assets - (15,000) (59,495) (15,000)
Total operating expenses 470,430 429,117 867,538 883,813
INCOME (LOSS) FROM OPERATIONS (40,945) (41,354) 64,016 (95,305)
Equity in the loss of
BioMarin/Genzyme LLC (79) (44) (156) (229)
Interest income 4,291 5,899 9,535 12,197
Interest expense (8,048) (6,866) (14,963) (13,593)
Other income, net 2,508 470 647 2,078
INCOME (LOSS) BEFORE INCOME
TAXES (42,273) (41,895) 59,079 (94,852)
Provision for (benefit from)
income taxes (13,090) (4,460) 6,881 (944)
NET INCOME (LOSS) (29,183) (37,435) 52,198 (93,908)
NET INCOME (LOSS) PER SHARE,
BASIC $
(0.16) $
(0.21) $
0.29 $
(0.53)
NET INCOME (LOSS) PER SHARE,
DILUTED $
(0.16) $
(0.21) $
0.28 $
(0.53)
Weighted average common shares
outstanding, basic 180,729 179,048 180,314 178,662
Weighted average common shares
outstanding, diluted 180,729 179,048 184,344 178,662
The following table presents Net Product Revenues by Product:
Net Product Revenues by Product
(In millions of U.S. dollars)
Three Months Ended
Six Months Ended
June 30,
June 30,
2020 2019 % Change 2020 2019 % Change
(unaudited) (unaudited) (unaudited) (unaudited)
Brineura $
25.8 $
14.8 74 $
49.8 $
27.0 84
% %
Firdapse (1) - 5.5 (100) 1.2 10.6 (89)
% %
Naglazyme 81.0 98.2 (18) 195.3 185.1 6
% %
PKU franchise 163.3 132.1 24 319.9 251.3 27
% %
Vimizim 116.7 122.7 (5) 253.9 248.5 2
% %
Net Product
Revenues
Marketed by
BioMarin 386.8 373.3 820.1 722.5
Aldurazyme Net
Product % %
Revenues
Marketed by
Genzyme 32.3 5.8 457 88.0 51.1 72
Total Net
Product
Revenues $
419.1 $
379.1 $
908.1 $
773.6
(1) In January 2020, BioMarin
divested the Firdapse assets to
a third party in a sale
transaction. The sale is
reflected in the Company's
consolidated financial
statements for the three and
six months ending June 30,
2020; and as a result of the
transaction BioMarin will not
recognize Net Product Revenues
from Firdapse in the future.
The following table presents Net Product Revenues for the PKU Franchise by Product:
Net Product Revenues by Product for the PKU Franchise
(In millions of U.S. dollars)
(unaudited)
Three Months Ended
Six Months Ended
June 30,
June 30,
2020 2019 % Change 2020 2019 % Change
(unaudited) (unaudited) (unaudited) (unaudited)
Kuvan $
122.6 113.3 8 $
244.6 220.2 11
% %
Palynziq 40.7 18.8 116 75.3 31.1 142
% %
Total PKU $
163.3 $
132.1 24 $
319.9 $
251.3 27
franchise % %
Non-GAAP Information
The results presented in this press release include both GAAP information and Non-GAAP information. As used in this release, Non-GAAP Income is defined by the Company as GAAP Net Income/Loss excluding net interest expense, provision for (benefit from) income taxes, depreciation expense, amortization expense, stock-based compensation expense, contingent consideration expense and, in certain periods, certain other specified items, as detailed below when applicable. In addition, BioMarin includes in this press release the effects of these adjustments on certain components of GAAP Net Income/Loss for each of the periods presented. In this regard, Non-GAAP Income and its components, including Non-GAAP Cost of Sales, Non-GAAP Research and Development expenses, Non-GAAP Selling, General and Administrative expense, Non-GAAP Intangible Asset Amortization and Contingent Consideration, Non-GAAP Gain on the Sale of Intangible Asset and Non-GAAP Benefit From Income Taxes are statement of operations line items prepared on the same basis as, and therefore components of, the overall Non-GAAP measures.
BioMarin regularly uses both GAAP and Non-GAAP results and expectations internally to assess its financial operating performance and evaluate key business decisions related to its principal business activities: the discovery, development, manufacture, marketing and sale of innovative biologic therapies. Because Non-GAAP Income and its components are important internal measurements for BioMarin, the Company believes that providing this information in conjunction with BioMarin's GAAP information enhances investors' and analysts' ability to meaningfully compare the Company's results from period to period and to its forward-looking guidance, and to identify operating trends in the Company's principal business. BioMarin also uses Non-GAAP Income internally to understand, manage and evaluate its business and to make operating decisions, and compensation of executives is based in part on this measure.
Non-GAAP Income and its components are not meant to be considered in isolation, as a substitute for, or superior to comparable GAAP measures and should be read in conjunction with the consolidated financial information prepared in accordance with GAAP. Investors should note that the Non-GAAP information is not prepared under any comprehensive set of accounting rules or principles and does not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP. Investors should also note that these Non-GAAP measures have no standardized meaning prescribed by GAAP and, therefore, have limits in their usefulness to investors. In addition, from time to time in the future there may be other items that the Company may exclude for purposes of its Non-GAAP measures; likewise, the Company may in the future cease to exclude items that it has historically excluded for purposes of its Non-GAAP measures. Because of the non-standardized definitions, the Non-GAAP measure as used by BioMarin in this press release and the accompanying tables may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by other companies.
The following table presents the reconciliation of GAAP Net Income (Loss) to Non-GAAP Income:
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Income
(In millions of U.S. dollars)
(unaudited)
Three Months Ended Six Months Ended
Guidance
June 30, June 30,
Year Ending
2020 2019 2020 2019 December 31, 2020
GAAP Net Income
(Loss) $
(29.2) $
(37.4) $
52.2 $
(93.9) $
720.0 $
980.0
Interest expense,
net 3.7 1.0 5.4 1.4 3.0 2.0
Provision for
(benefit from)
income taxes (13.1) (4.5) 6.9 (0.9) (721.8) (915.8)
Depreciation expense 9.7 12.9 20.0 27.9 50.0 47.0
Amortization expense 15.5 13.4 31.2 20.9 63.0 61.0
Stock-based
compensation
expense 45.1 39.8 92.0 82.6 177.0 167.0
Contingent
consideration
expense (0.6) 6.9 (0.6) 19.2 2.0 2.0
Gain on sale of
nonfinancial assets - (15.0) (59.5) (15.0) (59.5) (59.5)
Licensed In-Process
R&D (1) 26.3 26.3 26.3 26.3
Non-GAAP Income $
57.4 $
17.1 $
173.9 $
42.2 $
260.0 $
310.0
(1) Represents the one time
license fee paid to a third
party and recognized as R&D
expense in the second quarter
of 2020.
The following reconciliation of the GAAP reported to the Non-GAAP information provides the details of the effects of the Non-GAAP adjustments on certain components of the Company's operating results for each of the periods presented.
Reconciliation of Certain GAAP Reported Information to Non-GAAP Information
(In millions of U.S. dollars)
(unaudited)
Three months ended June 30,
2020 2019
Adjustments Adjustments
GAAP Interest, Stock-Based Non-GAAP GAAP Interest, Stock-Based Non-GAAP
Reported Taxes, Compensation, Reported Taxes, Compensation,
Depreciation Contingent Depreciation Contingent
and Consideration and Consideration
Amortization and Other Amortization and Other
Adjustments Adjustments
Cost of sales $
97.9
$ $
(4.9) $
93.0 $
77.4
$ $
(3.7) $
73.7
Research and
development 182.1 (4.6) (42.3) 135.2 185.6 (7.3) (14.9) 163.4
Selling, general
and administrative 175.4 (5.1) (24.2) 146.1 160.8 (5.6) (21.2) 134.0
Intangible asset
amortization and
contingent
consideration 14.9 (15.5) 0.6 20.3 (13.4) (6.9)
Gain on sale of
nonfinancial
assets - (15.0) 15.0
Interest expense,
net (3.7) 3.7 (1.0) 1.0
Provision for
(benefit from)
income taxes (13.1) 13.1 (4.5) 4.5
GAAP Net Income
(Loss)/Non-GAAP
Income $
(29.2) $
15.8 $
70.8 $
57.4 $
(37.4) $
22.8 $
31.7 $
17.1
Six months ended June 30,
2020 2019
Adjustments Adjustments
GAAP Interest, Stock-Based Non-GAAP GAAP Interest, Stock-Based Non-GAAP
Reported Taxes, Compensation, Reported Taxes, Compensation,
Depreciation Contingent Depreciation Contingent
and Consideration and Consideration
Amortization and Other Amortization and Other
Adjustments Adjustments
Cost of sales $
209.3 $
0.0 $
(10.0) $
199.3 $
166.6 $
0.0 (8.5) $
158.1
Research and
development 324.4 (9.4) (56.0) 259.0 369.2 (16.7) (28.8) 323.7
Selling, general
and administrative 362.7 (10.6) (52.3) 299.8 322.9 (11.2) (45.3) 266.4
Intangible asset
amortization and
contingent
consideration 30.6 (31.2) 0.6 40.1 (20.9) (19.2)
Gain on sale of
nonfinancial
assets (59.5) 59.5 (15.0) 15.0
Interest expense,
net (5.4) 5.4 (1.4) 1.4
Provision for
(benefit from)
income taxes 6.9 (6.9) (0.9) 0.9
GAAP Net Loss/Non-
GAAP Income 52.2 63.5 58.2 173.9 (93.9) 49.3 86.8 42.2
Contact:
Investors:
Media:
Traci McCarty Debra Charlesworth
BioMarin Pharmaceutical Inc. BioMarin Pharmaceutical Inc.
(415) 455-7558
(415) 455-7451
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SOURCE BioMarin Pharmaceutical Inc.
