Analyst Conference Summary



conference date: April 26, 2012 @ 6:00 AM Pacific Time
for quarter ending: March 31, 2012 (first quarter, Q1 2012)

I own this stock
Forward-looking statements

Overview: Another quarter with strong y/y profit growth.

Basic data (GAAP):

Revenue was $1.27 billion, down 1% sequentially from $1.28 billion but up 13% from $1.13 million in the year-earlier quarter.

Net income was $401.5 million, down 2% sequentially from $410.2 million but up 57% from $255.6 million year-earlier.

EPS (earnings per share) were $0.90, down 1% sequentially from $0.91, but up 67% from $0.54 year-earlier.


Q4 2011 Celgene summary
Q1 2011 Celgene summary


2012 guidance was reaffirmed. Total revenue is expected between $5.4 and $5.6 billion. Revlimid revenue up 19% y/y to $3.75 to $3.85 billion. Non-GAAP EPS range $4.70 to $4.80.

Quarter Highlights:

January was slower than expected. 2012 is positioned to "achieve transformational milestones." But quarter financial results were below projections, offset by sales momentum during the quarter.

Non-GAAP numbers: EPS $1.08, net income $484 million, up 2% sequentially from $473 million and up 23% y/y from $393 million.

Announced a strategic partnership with Epizyme for discovery of therapies inhibiting histone methyltransferases (HMTs) to treat genetically-defined cancers. The acquisition of Avila Therapeutics was completed.

Product sales were $1.25 billion, up 17% y/y. There was a significant impact from inventory as two major U.S. distributors merged.

REVLIMID revenues were $861 million, up 1% sequentially from $855 million and up 17% y/y. January sales were down, but sales accelerated later in the quarter, with accelerating new patient starts. Gained 4% market share to 56% of myeloma market. Advanced initiatives for future growth. Hopes for multiple myeloma recommendation in Europe by the end of Q2. Submitted marketing application for deletion 5q transfusion dependent MDS in Europe, with decision likely late 2012. Progressing expansion program for lymphomas and leukemias. Believes results of maintenance studies could add over a billion in revenue per year. "Regulatory submissions for this indication in additional markets, including the U.S., are planned through 2012."

VIDAZA revenues were $186 million, down sequentially from $189 million, but up 14% y/y. Decrease in U.S. masks a strong demand trend, and Q2 is already trending strong.

ABRAXANE revenues were $104 million, flat sequentially from $104 million, but up 41% y/y after the product re-launch. U.S. sales were $81 million, international $23 million. Full restocking of generic paclitaxil affected sales. Non-small cell lung cancer (NSCLC) supplemental NDA filed with FDA, with decision due in October. Pancreatic cancer Phase III trial in como with gemcitabine fully enrolled, as is metastatic melanoma trial.

THALOMID revenues were $78 million, down sequentially from $82 million, and declining 9% from year-earlier.

Royalty and collaboration revenue was $2.6 million. Royalty revenue $25.2 million, down sequentially from $38.2 million and down from $32.4 million year-earlier.

Cash and equivalents balance ended at $2.27 billion, down sequentially from $2.65 billion. Operating cash flow was $315 million. Repurchased 2.35 million shares for about $169 million. $350 million cash was used to close the acquisition of Avila Therapeutics.

Pomalidomide for relapsed and refractory multiple myeloma NDA submitted to FDA and a marketing application will be submitted in this quarter in Europe. Other clinical studies continue, with Phase III myelofibrosis trial fully enrolled.

Apremilast for psoriasis and psoriatic arthritis data is coming from trials this year.

Many compounds are now in pre-clinical or clinical development. See also Celgene product pipeline. CC-223 advanced into Phase 1.

Expects selling, general and administrative expense to decline during the year.


Global inventory for Revlimid? Total was $30 to $35 million global, with Revlimid the largest component.

Reimbursement in Europe if Revlimid approved for first line myeloma? Expected positive outcome of the review would be to move Revlimid to first line. We have a global team in place ready to engage post-approval.

U.S. Revlimid unit growth? In absolute, unit growth was mid-single digits in the quarter, but with acceleration in the later part of the quarter.

MM 020 trial? Very important study to solidify Revlimid for MM. Set to trigger independent review. The optimal first look would contain a strong trend to survival.

Durations of therapy? Trend continues to improve, particularly in Europe. Publication of 3 papers on duration is a very important confidence builder.

CMP oral questions? We have not been asked to appear, but are prepared to appear if requested. (in Europe for Revlimid expansion)

New starts were not declining in Q3 or Q4, but were not growing as fast as they did in Q1, which set an all-time record.

Inventory changes set for rebound in Q2? We are not counting on a rebound from inventory levels. But we don't know if this is the new normal, inventories were the lowest we have ever seen, may be due to efficiency in the system.

Second primary malignancy concerns with Revlimid? People focused on this finding in 2011. In some markets there was an impact, particularly in France. Probably slowed growth. But full publication of papers on the question should show the benefit risk profile favors continuous use of Revlimid.

Vidaza generic entry? We have no specific information on the timing of generic Vidaza in the U.S.

Market opportunity beyond myeloma? CLL, NHL, Rituxan with Revlimid would be a multi-billion dollar opportunity. We will see new data and new indications over the next few years.

Apremilast filing? Psoriatic arthritis data due in summer. Will not wait for psoriasis data to file the psoriatic arthritis, if results are positive. This will be a very important market opportunity.

Phase III Revlimid for NHL data flow will begin end of year, but could last five or six year.

Abraxane reintroduction in Europe? Revenues in Q1 smoothed out from earlier launch stocking effects. $20 to $25 million should be the new international base revenue. Partner in Japan is seeking approval for new indications. Pancreatic cancer market has potential in Europe.

If Rituxan plus Revlimid works, we could replace traditional chemotherapy with its toxicity issues.

OpenIcon Analyst Conference Summaries Main Page

Celgene Investor Relations page

My Celgene main page


More Analyst Conference Pages:



Disclaimer: Our analyst summaries may include both our condensations of statements made by company representatives and our own analysis. They are not covered by any warranty. We cannot guarantee anything said by company representatives is true. We try not to make errors, but it is possible. Before making or terminating an investment you should always verify any factual basis of your decision.

Copyright 2012 William P. Meyers