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Incyte Annual Report, Year Ended Dec 31, 2001

Filing Date
Filed April 1, 2002
Period End
December 31, 2001
Security
INCY
In the record · 2016–202610-K1510-Q348-K107

INCY filed 15 annual reports (10-K), 34 quarterly reports (10-Q) and 107 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Dec ’16Dec ’16
  2. FY2018 annual report10-K · Feb ’19Feb ’19
  3. Leadership change8-K · Jan ’22Jan ’22
  4. Leadership change8-K · Dec ’25Dec ’25

01—Abstract

Summary

Summary of the 10-K filed April 1, 2002. Cited figures are marked; the original filing is the authoritative source.

Incyte Genomics, Inc. reported a 2001 net loss of $183.2 milliona, or $2.77 per share, on revenues of $219.3 million, compared with a net loss of $29.7 million on revenues of $194.2 million in 2000.

The loss was driven largely by a fourth-quarter 2001 restructuring and long-lived asset charge of $130.4 millionb, which the company recorded after changing its strategic focus to its therapeutic discovery and development programs and its information products. Of that charge, $68.7 million was goodwill and intangibles impairment, $55.6 million was non-recurring restructuring, and $6.1 million was impairment of a long-lived asset. Research and development expenses rose to $213.3 million from $192.6 million, and the company stated it expects to incur losses in 2002.

The company held $507.9 millionc in cash, cash equivalents and marketable securities at December 31, 2001, down from $582.2 million a year earlier, and had $179.2 million of 5.5% convertible subordinated notes due 2007 outstanding. For 2002, Incyte expects revenues of $130.0 million to $150.0 million and total costs and expenses of $210 million to $220 million, and it expects cash and marketable securities of $400 million to $420 million at December 31, 2002, excluding strategic investments. Management states that existing resources are adequate for at least the next twelve months.

The filing also highlights significant legal exposure. The company settled patent litigation with Affymetrix in December 2001 on a royalty-bearing license basis, but Invitrogen Corporation filed an infringement suit against Incyte in October 2001, and the company has filed its own counter-suit; management states it cannot reasonably estimate the possible range of loss from the Invitrogen suit. The company also reported 585 employees at December 31, 2001, after a workforce reduction of approximately 400 employees.

02—Key points

Key Highlights

  1. Net loss of $183.2 million ($2.77 per share) in 2001, versus a net loss of $29.7 million ($0.47 per share) in 2000
  2. Revenues of $219.3 million in 2001, up from $194.2 million in 2000; the company expects 2002 revenues of $130.0 million to $150.0 million
  3. Fourth-quarter 2001 other expenses of $130.4 million, including $68.7 million goodwill and intangibles impairment and $55.6 million non-recurring restructuring charges
  4. Cash, cash equivalents and marketable securities of $507.9 million at December 31, 2001, versus $582.2 million at December 31, 2000
  5. $179.2 million of 5.5% convertible subordinated notes due 2007 outstanding at year-end 2001
  6. Exited microarray, genomic screening, public domain clone, contract sequencing, transgenics and SNP discovery activities to focus on therapeutic discovery and information products
  7. Ongoing patent litigation with Invitrogen Corporation, for which management cannot reasonably estimate the possible range of loss

03—Questions

Frequently Asked Questions

  1. Why did Incyte report such a large loss in 2001?

    The 2001 net loss of $183.2 million reflects a fourth-quarter charge of $130.4 million for restructuring and long-lived asset impairments, recorded as the company changed its strategic direction. The charge included $68.7 million for goodwill and intangibles impairment, largely tied to the Proteome and Hexagen acquisitions, and $55.6 million for non-recurring restructuring. Research and development spending of $213.3 million also rose from $192.6 million in 2000.

  2. What does Incyte expect for 2002?

    The company expects 2002 revenues of $130.0 million to $150.0 million, reflecting the exit from custom genomics products and services, and total costs and expenses of $210 million to $220 million. It expects to incur losses in 2002 and expects its cash and marketable securities balance at December 31, 2002 to be in the range of $400 million to $420 million, excluding strategic investments.

  3. Does Incyte have enough cash to fund operations?

    Management states that existing resources will be adequate to satisfy its capital needs for at least the next twelve months. The company had $507.9 million in cash, cash equivalents and marketable securities at year-end 2001, but it also has $179.2 million of convertible subordinated notes due 2007 and says it may need to raise additional capital at some future point.

  4. What are the main legal risks?

    Invitrogen Corporation filed an action in October 2001 alleging infringement of three patents, and Incyte filed a separate complaint against Invitrogen alleging infringement of fourteen of its patents. Management states it believes it has meritorious defenses but cannot reasonably estimate the possible range of loss, and expects substantial litigation costs regardless of outcome. Incyte settled its Affymetrix litigation in December 2001 through royalty-bearing licenses, though its appeal regarding Stanford-licensed patent applications is not part of that settlement.

04—Continue

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