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United Therapeutics Annual Report, Year Ended Dec 31, 2005

Filing Date
Filed February 27, 2006
Period End
December 31, 2005
Security
UTHR
In the record · 2016–202610-K1110-Q338-K152

UTHR filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 152 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · May ’17May ’17
  2. Leadership change8-K · Jun ’19Jun ’19
  3. Material agreement8-K · Apr ’22Apr ’22
  4. Leadership change8-K · Jan ’26Jan ’26

01—Abstract

Summary

Summary of the 10-K filed February 27, 2006. Cited figures are marked; the original filing is the authoritative source.

United Therapeutics Corporation (filed under this name; NASDAQ: UTHR) is a biotechnology company focused on cardiovascular, cancer and infectious disease products.

Its lead product, Remodulin (treprostinil), is approved by the FDA for pulmonary arterial hypertension, and it accounted for 94 percent of total revenues in 2005. Revenues rose to $115.9 milliona in 2005 from $73.6 million in 2004, and the company reported net income of $65.0 million, or $2.58 per diluted share, which included a $17.5 million income tax benefit from a $19.7 million reduction in its deferred tax valuation allowance. Income from operations was $42.9 million, compared with $13.2 million in 2004.

The company had an accumulated deficit of $115.3 millionb at December 31, 2005, and cash, cash equivalents and marketable investments of $191.0 million. The most significant risk for investors is Remodulin's FDA approval status. Approval is conditioned on completing a post-marketing Phase IV study, which did not meet its enrollment deadlines.

The company submitted interim results from 21 patients, which it reports as positive (p=0.0006), and enrollment is suspended pending FDA review. The FDA could extend the trial or institute a public hearing to withdraw approval.

Other pipeline programs are earlier stage: the OvaRex ovarian cancer Phase III trials are ongoing, the lead glycobiology antiviral UT-231B did not show efficacy against hepatitis C, and the inhaled TRIUMPH trial is about one-half enrolled. The company also discontinued its HeartBar product line in January 2006 and expects a roughly $2.0 millionc non-cash impairment charge in the first quarter of 2006.

02—Key points

Key Highlights

  1. Remodulin sales were $109.2 million in 2005, up from $66.1 million in 2004, and accounted for 94 percent of total revenues.
  2. Net income was $65.0 million in 2005 (diluted EPS $2.58), compared with $15.4 million in 2004, and included a $17.5 million income tax benefit.
  3. The company reported an accumulated deficit of $115.3 million at December 31, 2005, down from $180.3 million a year earlier.
  4. The Remodulin Phase IV post-marketing study missed FDA enrollment deadlines; enrollment is suspended pending FDA review of interim results, and the FDA could institute a public hearing to withdraw approval.
  5. OvaRex is in two Phase III ovarian cancer trials (IMPACT I and II), with about 330 of 354 patients enrolled as of December 31, 2005.
  6. Glycobiology lead UT-231B did not demonstrate efficacy against hepatitis C in patients who previously failed conventional treatments.
  7. Cash, cash equivalents and marketable investments were $191.0 million at December 31, 2005, up from $139.1 million.
  8. HeartBar products were discontinued in January 2006, with approximately $2.0 million in non-cash impairment charges expected in Q1 2006.

03—Questions

Frequently Asked Questions

  1. How much of the company's revenue depends on Remodulin?

    Remodulin sales accounted for 94 percent of total revenues in 2005. Revenues from Remodulin were $109.2 million of $115.9 million total revenues in 2005. Revenues from two U.S. distributors, Accredo and CuraScript, accounted for most of the company's revenues in 2005.

  2. What is the risk tied to the Remodulin Phase IV study?

    Continued FDA approval of Remodulin depends on timely completion of the Phase IV trial and its outcome. The enrollment deadlines were not met and a final report was not submitted in December 2005. The company submitted interim results from 21 patients to the FDA and requested permission to end the study. If the FDA does not accept the results, it could extend the trial or institute a public hearing to withdraw marketing approval for Remodulin.

  3. Did the company turn profitable, and what drove 2005 net income?

    Yes. The company reported 2005 net income of $65.0 million, compared with $15.4 million in 2004. Income from operations rose to $42.9 million from $13.2 million. Net income also included a $17.5 million income tax benefit, which resulted mainly from a $19.7 million reduction in the deferred tax asset valuation allowance. The company said it had been profitable in every quarter since March 31, 2004.

  4. Does the company pay dividends, and how many employees does it have?

    The company has never paid cash dividends on its common stock and intends to retain earnings for growth. It had approximately 210 employees as of February 21, 2006.

04—Continue

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