10-QPeriod: Q1 FY2010

REGENERON PHARMACEUTICALS, INC. Quarterly Report for Q1 Ended Mar 31, 2010

Filed April 29, 2010For Securities:REGN

Summary

Regeneron Pharmaceuticals, Inc. (REGN) reported its first quarter 2010 financial results, showing a significant increase in revenue driven by collaboration and product sales, though the company also experienced an increased net loss. Total revenues grew to $103.5 million from $75.0 million in the prior year period, primarily due to higher collaboration revenues from sanofi-aventis and Bayer HealthCare, alongside a substantial increase in net product sales from ARCALYST®. Despite revenue growth, the net loss widened to $30.5 million ($0.38 per share) from $15.4 million ($0.19 per share) in Q1 2009. This was largely driven by a significant increase in research and development (R&D) expenses, particularly related to clinical trials for key pipeline candidates like VEGF Trap-Eye and various antibody programs. The company continues to advance its late-stage clinical programs in oncology and ophthalmology, with several key data readouts expected in late 2010 and early 2011.

Financial Highlights

23 data points
Beta

Revenue

$103.53M

99.3% Gross Margin

Net Income

-$30.52M

-29.5% Net Margin

EPS (Diluted)

$-0.38

Cash & Equivalents

$117.31M

Free Cash Flow

-$9.58M

Financial Statements
Beta
Revenue$103.53M
Cost of Revenue$717K
Gross Profit$102.82M
R&D Expenses$117.47M
SG&A Expenses$14.22M
Operating Expenses$132.41M
Operating Income-$28.88M
Interest Expense$2.08M
Net Income-$30.52M
EPS (Basic)$-0.38

Key Highlights

  • 1Total revenues increased by 38% year-over-year to $103.5 million, driven by robust collaboration revenues and a significant jump in ARCALYST® net product sales.
  • 2Net loss widened to $30.5 million ($0.38/share) from $15.4 million ($0.19/share) in the prior year period, primarily due to increased R&D spending.
  • 3ARCALYST® net product sales significantly increased to $9.9 million, including $4.8 million of previously deferred sales, compared to $3.9 million in Q1 2009.
  • 4Collaboration revenue from sanofi-aventis and Bayer HealthCare grew to $81.8 million, reflecting ongoing R&D cost-sharing and deferred revenue recognition.
  • 5Research and development expenses surged by 46% to $117.5 million, largely attributed to increased clinical trial expenses for VEGF Trap-Eye and antibody programs.
  • 6The company advanced its key late-stage clinical programs, with data expected from gout and ophthalmology studies in the coming quarters.
  • 7Regeneron maintained a strong liquidity position, with $413.5 million in cash, cash equivalents, and marketable securities at quarter-end.

Frequently Asked Questions

Regeneron's revenue increased by 38% to $103.5 million, primarily driven by higher collaboration revenues from ongoing research and development activities with partners like sanofi-aventis and Bayer HealthCare, as well as a significant increase in net product sales for ARCALYST®.

The company's net loss widened to $30.5 million from $15.4 million in the prior year due to a substantial increase in research and development expenses. These higher expenses were primarily related to advancing multiple clinical trial programs, including those for VEGF Trap-Eye and various antibody candidates.

The increase in ARCALYST® net product sales to $9.9 million from $3.9 million represents a positive trend for the company's only marketed product. This includes $4.8 million of previously deferred sales, indicating improved estimation of returns and rebates, which allowed for the recognition of past sales.

Regeneron expects to report initial data from its Phase 3 trials for rilonacept in gout during the second quarter of 2010, and from its VIEW 1 and VIEW 2 trials for VEGF Trap-Eye in wet AMD in late 2010. Further data readouts for other key programs are anticipated throughout 2010 and 2011.