FOSTER CITY, Calif.,
May 10, 2017 /PRNewswire/ -- SciClone
Pharmaceuticals, Inc. (NASDAQ: SCLN) today reported financial
results for the quarter ended March 31,
2017.
- Revenues: In the first quarter 2017, SciClone reported
revenues of $42.9 million, compared
to $36.5 million for the same period
in 2016.
- GAAP Diluted EPS: In the first quarter 2017, SciClone
reported GAAP diluted earnings per share of $0.28, compared to $0.15 for the same period in 2016.
- Non-GAAP Diluted EPS: In the first quarter 2017,
SciClone reported non-GAAP diluted earnings per share of
$0.31, compared to $0.19 for the same period in 2016.
Revenues in the first quarter of 2017 were $42.9 million, a $6.4
million or 18% increase, compared to $36.5 million for the same period in 2016.
ZADAXIN® revenues were $39.5 million
in the first quarter of 2017, a $5.9
million or 17% increase, compared to $33.6 million for the same period in 2016. Of the
$39.5 million in ZADAXIN revenues,
$4.2 million was attributed to
revenues from sales generated in the fourth quarter of 2016 but
recognized in the first quarter of 2017. This $4.2 million of revenue is a result of fourth
quarter sales that were above the reference tender price under a
provision in the agreement with the Company's China distributor to share, in part, in the
burden of price reductions. Promotion services revenues were
$1.3 million for the first quarter of
2017, a $0.1 million or 6% increase,
compared to $1.2 million for the same
period in 2016.
On a GAAP basis, SciClone reported net income in the first
quarter of 2017 of $14.6 million, or
$0.28 and $0.28 per share on a basic and diluted basis,
respectively, compared to net income of approximately $7.9 million, or $0.16 and $0.15 per
share on a basic and diluted basis, respectively, for the same
period in 2016.
SciClone's non-GAAP net income in the first quarter of 2017 was
$16.6 million, or $0.32 and $0.31 per
share on a basic and diluted basis, respectively, compared with
non-GAAP net income of $9.7 million,
or $0.20 and $0.19 per share on a basic and diluted basis,
respectively, for the same period of the prior year. Both GAAP and
non-GAAP net income were favorably impacted by the additional
revenue recognition for ZADAXIN fourth quarter sales and a Chinese
government subsidy in the first quarter of 2017.
Friedhelm Blobel, PhD, SciClone's
Chief Executive Officer commented: "We delivered a strong first
quarter performance, in line with our expectations, and reflecting
the continued demand for, and growth potential of, ZADAXIN and our
core business. ZADAXIN's competitive position remains strong, with
continued volume growth despite generic competition. ZADAXIN's
double-digit volume growth rate continued this quarter,
underscoring its strength as the leading branded thymalfasin, with
a 17% volume share and more than a 40% value share. We do face
continued pricing pressure, with tenders in two provinces recently
announced at prices lower than the reference price with our
distributor. We cannot determine at this time with certainty when
these prices will take effect, or when they will impact prices in
other provinces, but we are likely to experience some effect of
those lower prices at some point during the next few quarters. We
may also see some pressure on unit volumes in some areas as a
result of reduced national-level reimbursement for
thymalfasins."
"We have demonstrated our ability to manage the various
challenges of the China market
effectively to date, and we are continuing to focus on strategies
to expand the market for ZADAXIN, manage the impact of potential
reimbursement changes and provincial pricing pressures and actively
seek to participate in the provincial reimbursement negotiations
for thymalfasins to maximize future reimbursement for ZADAXIN. We
further expect that pricing pressures on revenue in 2017 will be
offset, at least in part, through continued sharing of the burden
with our China distributor and
potentially through volume increases. We are confident that ZADAXIN
has significant growth potential as a differentiated, high quality,
Western-manufactured brand."
"We were pleased to see continued strong growth in our oncology
portfolio in the first quarter. The market introduction of DC Bead®
to treat liver cancer is continuing to progress, although slower
than anticipated. We are continuing implementation of our
academic-focused marketing effort to build the market for DC Bead
as an alternative to conventional TACE procedures using gels. Our
development portfolio continues to advance, led by Angiomax®
(bivalirudin) for which we expect to file the NDA in the coming
months."
"As we near the mid-year mark for 2017, we have confidence that
our core strategies to grow our commercial business, advance
and expand our development portfolio through creative partnering,
maintain high levels of fiscal responsibility, and strong
compliance are on track. We believe we are well positioned to
continue to build our reputation and standing as a key player in
the evolving China pharma
market."
For the first quarter of 2017, sales and marketing (S&M)
expenses were $12.8 million, compared
with $12.4 million for the same
period in 2016. The increase in S&M expenses for first quarter
of 2017, compared to the same period in 2016, related to increases
in salaries and benefits, mainly from annual increases, and to
increased sales commissions based on increased ZADAXIN sales.
For the first quarter of 2017, research and development
(R&D) expenses were $2.5 million,
compared with $1.5 million of R&D
expenses for the same period of 2016. R&D expenses were higher
for the first quarter of 2017, compared to the first quarter of
2016, related to R&D activities in China that relate to development expenses of
product candidates in-licensed from certain business partners.
For the first quarter of 2017, general and administrative
(G&A) expenses were $7.2 million,
compared with $7.4 million for the
same period in 2016. G&A expenses were lower for the first
quarter of 2017, compared to the first quarter of 2016, due to a
foreign currency gain of $615
thousand on re-measuring operational monetary assets
partially offset by an increase in salaries and benefits mainly
from annual increases.
For the first quarter of 2017, other income, net was
$1.0 million, compared with
$0.1 million for the same period in
2016. Other income, net was higher principally for the first
quarter of 2017, compared to the first quarter of 2016, as a result
of a $1.0 million government subsidy
related to the Company's China
operations which had no future performance obligations and was
recognized upon receipt as other income.
For the first quarter of 2017, income tax
provision was approximately $1.0 million, compared with
$1.9 million for the same period in
2016. The $1.9 million income tax
provision for the first quarter of 2016 included $1.2 million in additional tax expense
representing the correction of an error related to a previously
unrecognized liability for an uncertain tax provision in
China.
As of March 31, 2017, cash and
cash equivalents totaled $141.3
million, compared to $134.4
million as of December 31,
2016.
SciClone has presented non-GAAP information above as the Company
believes this non-GAAP information is useful for investors, taken
in conjunction with SciClone's GAAP financial statements, because
management uses such information internally for its operating,
budgeting and financial planning purposes. Non-GAAP information is
not prepared under a comprehensive set of accounting rules and
should only be used to supplement an understanding of SciClone's
operating results as reported under GAAP. The non-GAAP calculations
and reconciliation are provided in the accompanying table titled
"Reconciliation of GAAP to Non-GAAP Net Income."
Conference Call Today
SciClone is hosting a conference call today at 4:30 pm ET (1:30 pm
PT) to provide a business and financial update. The
call will be hosted by Friedhelm
Blobel, Ph.D., President and Chief Executive Officer, and
Wilson W. Cheung, Senior Vice
President and Chief Financial Officer.
LIVE
CALL:
|
877.674.6420
(US/Canada)
|
|
920.663.6281
|
|
Passcode:
11577623
|
The conference call will contain forward-looking statements.
Interested parties who wish to listen to the webcast should visit
the Investor Relations section of SciClone's website at
www.sciclone.com. The information provided on the teleconference is
accurate only at the time of the conference call, and SciClone will
take no responsibility for providing updated information except as
required by law.
About SciClone
SciClone Pharmaceuticals is a revenue-generating, specialty
pharmaceutical company with a substantial commercial business in
China and a product portfolio
spanning major therapeutic markets including oncology, infectious
diseases and cardiovascular disorders. SciClone's proprietary
lead product, ZADAXIN® (thymalfasin), is approved
in over 30 countries and may be used for the treatment of hepatitis
B (HBV), hepatitis C (HCV), and certain cancers, and as an immune
system enhancer, according to the local regulatory approvals. The
Company has successfully in-licensed and commercialized products
with the potential to become future market leaders and to drive the
Company's long-term growth, including DC Bead®, a novel
treatment for liver cancer now approved in China, and several other products in late
stage development in China.
Through its promotion business with pharmaceutical partners,
SciClone also markets multiple branded products in China which are therapeutically
differentiated. SciClone is a publicly-held corporation based in
Foster City, California, and
trades on the NASDAQ Global Select Market under the symbol SCLN.
For additional information, please visit www.sciclone.com.
Forward-Looking Statements
This press release contains forward-looking statements regarding
expected future events and SciClone's financial results and
expectations, including, without limitation, statements regarding
SciClone's business strategy and growth, product and development
portfolios, market opportunities and forecasted financial
results. Readers are urged to consider statements that
include the words "may," "will," "would," "could," "should,"
"might," "believes," "estimates," "projects," "potential,"
"expects," "plans," "anticipates," "intends," "continues,"
"forecast," "designed," "goal," "approximately" or the negative of
those words or other comparable words to be uncertain and
forward-looking. These statements are subject to risks and
uncertainties that are difficult to predict and actual outcomes may
differ materially. These include risks and uncertainties relating
to: the course, cost and outcome of regulatory matters, including
future pricing and reimbursement decisions by authorities in
China; the dependence of
SciClone's sales of ZADAXIN in China; SciClone's ability to execute on its
goals in China and on its
objectives for earnings and revenue in fiscal 2017; SciClone's
ability to implement and maintain controls over its financial
reporting; the dependence of its current and future revenue
and prospects on third-party license, promotion or distribution
agreements, including the need to renew such agreements, enter into
similar agreements, or end arrangements that SciClone does not
believe are beneficial; operating an international business,
including currency exchange fluctuations; uncertainty in the
prospects for unapproved products, including uncertainties as to
pricing and competition and risks relating to the clinical trial
process and related regulatory approval process and the process of
initiating trials at, and enrolling patients at, clinical sites.
Please also refer to other risks and uncertainties described in
SciClone's filings with the SEC. All forward-looking statements are
based on information currently available to SciClone and SciClone
assumes no obligation to update any such forward-looking
statements.
SciClone, SciClone Pharmaceuticals, the SciClone
Pharmaceuticals design, the SciClone logo and ZADAXIN are
registered trademarks of SciClone Pharmaceuticals, Inc. in
the United States and numerous
other countries.
SCICLONE
PHARMACEUTICALS, INC.
|
UNAUDITED
CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per
share amounts)
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
2017
|
|
2016
|
Revenues:
|
|
|
|
|
|
|
Product sales,
net
|
|
$
|
41,637
|
|
$
|
35,320
|
Promotion
services
|
|
|
1,255
|
|
|
1,179
|
Total net
revenues
|
|
|
42,892
|
|
|
36,499
|
Operating
expenses:
|
|
|
|
|
|
|
Cost of product
sales
|
|
|
6,165
|
|
|
5,813
|
Sales and
marketing
|
|
|
12,765
|
|
|
12,352
|
Research and
development
|
|
|
2,495
|
|
|
1,467
|
General and
administrative
|
|
|
7,230
|
|
|
7,443
|
Total operating
expenses
|
|
|
28,655
|
|
|
27,075
|
Income from
operations
|
|
|
14,237
|
|
|
9,424
|
Non-operating
income:
|
|
|
|
|
|
|
Interest and investment
income
|
|
|
296
|
|
|
259
|
Other income,
net
|
|
|
1,075
|
|
|
128
|
Income before
provision for income tax
|
|
|
15,608
|
|
|
9,811
|
Provision for income
tax
|
|
|
1,012
|
|
|
1,947
|
Net
income
|
|
$
|
14,596
|
|
$
|
7,864
|
|
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.28
|
|
$
|
0.16
|
Diluted
|
|
$
|
0.28
|
|
$
|
0.15
|
|
|
|
|
|
|
|
Weighted average
shares used in computing net income per share:
|
|
|
|
|
|
|
Basic
|
|
|
51,437
|
|
|
49,589
|
Diluted
|
|
|
53,011
|
|
|
51,955
|
SCICLONE
PHARMACEUTICALS, INC.
|
RECONCILIATION OF
GAAP TO NON-GAAP NET INCOME (in thousands, except per share
amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
2017
|
|
2016
|
GAAP net
income
|
|
$
|
14,596
|
|
$
|
7,864
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
Employee stock-based
compensation
|
|
|
1,671
|
|
|
1,293
|
Strategic review
expense
|
|
|
377
|
|
|
547
|
Non-GAAP net
income
|
|
$
|
16,644
|
|
$
|
9,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
income per share:
|
|
|
|
|
|
|
Basic
|
|
$
|
0.32
|
|
$
|
0.20
|
Diluted
|
|
$
|
0.31
|
|
$
|
0.19
|
|
|
|
|
|
|
|
Non-GAAP weighted
average shares used in computing net income per
share:
|
|
|
|
|
|
|
Basic
|
|
|
51,437
|
|
|
49,589
|
Diluted
|
|
|
53,009
|
|
|
51,955
|
SciClone management uses these non-GAAP financial measures to
monitor and evaluate the Company's operating results and trends on
an on-going basis and internally for operations, budgeting and
financial planning purposes. SciClone believes the non-GAAP
information is useful for investors by offering them the ability to
better understand how management evaluates the business. These
non-GAAP measures have limitations, however, because they do not
include all items of income and expenses that affect SciClone.
These non-GAAP financial measures that management uses are not
prepared in accordance with, and should not be considered in
isolation of, or as an alternative to, measurements required by
GAAP.
SciClone's non-GAAP financial measures exclude the following
items from GAAP net income and net income per share:
- Employee stock-based compensation. The effects of
non-cash employee stock-based compensation.
- Strategic review expense. The effects of costs incurred
related to the Company's strategic review for the purpose of
maximizing shareholder value.
SCICLONE
PHARMACEUTICALS, INC.
|
UNAUDITED SELECTED
BALANCE SHEET DATA (in thousands)
|
|
|
March
31,
|
|
December
31,
|
|
|
2017
|
|
2016
|
Cash and cash
equivalents
|
|
$
|
141,346
|
|
$
|
134,395
|
Accounts receivable,
net
|
|
|
46,624
|
|
|
41,510
|
Inventories
|
|
|
15,331
|
|
|
16,587
|
Goodwill
|
|
|
31,097
|
|
|
30,838
|
Total
assets
|
|
|
253,478
|
|
|
241,898
|
Total current
liabilities
|
|
|
20,015
|
|
|
26,441
|
Total stockholders'
equity
|
|
|
233,376
|
|
|
215,365
|
Corporate
Contacts
|
|
Wilson W.
Cheung
|
Jane Green
|
Chief Financial
Officer
|
Investors/Media
|
650.358.3434
|
650.358.1447
|
wcheung@sciclone.com
|
jgreen@sciclone.com
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/sciclone-reports-first-quarter-2017-financial-results-300455126.html
SOURCE SciClone Pharmaceuticals, Inc.