Lilly ICOS LLC Reports Record Sales for Third Quarter of 2006
BOTHELL, Wash. and INDIANAPOLIS, Oct. 19 /PRNewswire-FirstCall/ — Lilly ICOS LLC (Lilly ICOS) is releasing its financial results for the 2006 third quarter, ended September 30. Worldwide sales of Cialis(R) (tadalafil)(1) totaled $245.6 million in the third quarter of 2006, an increase of 26% compared to the third quarter of 2005. Net income was $79.6 million for the 2006 third quarter, compared to $19.8 million in the 2005 third quarter.
Cialis Net Sales: (in millions) Three Months Ended Nine Months Ended September 30, September 30, —————— —————— 2006 2005 2006 2005 —— —— —— —— Lilly ICOS Territories: United States $94.9 $77.5 $271.3 $ 191.3 Europe(2) 75.5 62.0 214.4 179.2 Canada and Mexico 20.2 14.7 54.9 40.7 —— —— —— —— Total Lilly ICOS 190.6 154.2 540.6 411.2 Royalty Territories 55.0 40.9 161.2 124.9 —— —— —— —— Worldwide Total $245.6 $195.1 $701.8 $536.1 ====== ====== ====== ======
In August 2006, patient enrollment began in a Phase 2b clinical study evaluating the efficacy and safety of tadalafil in men with symptoms of benign prostatic hyperplasia (BPH). The double-blind, placebo-controlled Phase 2b clinical study is designed to enroll more than 1,000 patients, administered one of four doses of tadalafil or placebo once-a-day for 12 weeks. This trial may serve as a pivotal study to support regulatory filings seeking approval of tadalafil for the treatment of symptoms of BPH.
Financial Results
Lilly ICOS reported net income of $79.6 million for the three months ended September 30, 2006, compared to $19.8 million for the three months ended September 30, 2005, reflecting a $50.5 million (26%) increase in worldwide sales of Cialis and a $20.3 million (18%) reduction in selling, general and administrative expenses.
Total Lilly ICOS revenue for the third quarter of 2006 was $201.6 million, compared to $162.3 million for the third quarter of 2005, an increase of 24%. The increase primarily reflects the impact of market share gains, market growth and price increases.
The $20.3 million (18%) decrease in selling, general and administrative expenses, in the third quarter of 2006, compared to the third quarter of 2005, was primarily due to refinements in the U.S. sales force configuration and lower consumer marketing expenditures in the third quarter of 2006.
Research and development expenses were $15.1 million in the third quarter of 2006, compared to $18.0 million in the third quarter of 2005. The decrease was primarily the result of completing, in 2005, a BPH Phase 2 clinical study as well as other regulatory studies, partially offset by increased costs associated with the pulmonary arterial hypertension and BPH clinical studies in 2006.
For the nine months ended September 30, 2006, Lilly ICOS reported net income of $220.4 million, compared to a net loss of $23.6 million for the nine months ended September 30, 2005. The improvement was primarily due to the $165.7 million (31%) increase in worldwide sales of Cialis and a $106.7 million (28%) reduction in selling, general and administrative expenses.
About Lilly ICOS LLC
Lilly ICOS LLC, a joint venture equally owned by ICOS Corporation and Eli Lilly and Company, is marketing Cialis in North America and Europe for the treatment of erectile dysfunction.
ICOS Corporation, a biotechnology company headquartered in Bothell, Washington, is dedicated to bringing innovative therapeutics to patients. ICOS is working to develop treatments for serious unmet medical conditions such as benign prostatic hyperplasia, hypertension, pulmonary arterial hypertension, cancer and inflammatory diseases.
Eli Lilly and Company, a leading innovation-driven corporation, is developing a growing portfolio of first-in-class and best-in-class pharmaceutical products by applying the latest research from its own worldwide laboratories and from collaborations with eminent scientific organizations. Headquartered in Indianapolis, Indiana, Lilly provides answers — through medicines and information — for some of the world’s most urgent medical needs. F-LLY
Except for historical information contained herein, this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current expectations, estimates and projections about the industry, management beliefs and certain assumptions made by the managements of ICOS and Lilly. Investors are cautioned that matters subject to forward-looking statements involve risks and uncertainties, including economic, competitive, governmental, technological, legal and other factors discussed in the two companies’ respective filings with the Securities and Exchange Commission, which may affect the business and prospects of the two companies and Lilly ICOS. Results and the timing and outcome of events may differ materially from those expressed or implied by the forward-looking statements in this press release. More specifically, there can be no assurance that Cialis will achieve sustained commercial success or that competing products will not pre-empt market opportunities that might exist for the product.
The forward-looking statements contained in this press release represent ICOS’ and Lilly’s judgments as of the date of this release. Neither ICOS nor Lilly undertake any obligation to update any forward-looking statements.
Lilly ICOS LLC Condensed Consolidated Statements of Operations (in thousands) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, ——————— ———————- 2006 2005 2006 2005 ——– ——– ——— ——— Revenue: Product sales, net $190,578 $154,157 $540,513 $411,233 Royalties 11,008 8,172 33,738 24,972 ——– ——– ——— ——— Total revenue 201,586 162,329 574,251 436,205 ——– ——– ——— ——— Expenses: Cost of sales 15,031 12,378 42,783 34,064 Selling, general and administrative 91,830 112,152 268,689 375,411 Research and development 15,087 18,035 42,409 50,322 ——– ——– ——— ——— Total expenses 121,948 142,565 353,881 459,797 ——– ——– ——— ——— Net income (loss) $79,638 $19,764 $220,370 $(23,592) ======== ======== ========= ========= Lilly ICOS LLC SUMMARIZED OPERATING RESULTS (in thousands) (unaudited) 2006 ———————————– Q1 Q2 Q3 TOTAL ——- ——- ——- ——– Revenue: Product sales, net: United States $82,537 $93,779 $94,946 $271,262 Europe 67,586 71,374 75,427 214,387 Canada and Mexico 17,151 17,508 20,205 54,864 ——- ——- ——- ——– Total product sales, net 167,274 182,661 190,578 540,513 Royalties 11,088 11,642 11,008 33,738 ——- ——- ——- ——– Total revenue 178,362 194,303 201,586 574,251 ——- ——- ——- ——– Expenses: Cost of sales 13,382 14,370 15,031 42,783 Selling, general and administrative 86,517 90,342 91,830 268,689 Research and development 13,502 13,820 15,087 42,409 ——- ——- ——- ——– Total expenses 113,401 118,532 121,948 353,881 ——- ——- ——- ——– Net income (loss) $64,961 $75,771 $79,638 $220,370 ======= ======= ======= ======== 2005 ——————————————– Q1 Q2 Q3 Q4 TOTAL ——- ——- ——- ——- ——– Revenue: Product sales, net: United States $42,744 $71,118 $77,438 $81,615 $272,915 Europe 56,264 60,925 61,992 65,311 244,492 Canada and Mexico 12,186 13,839 14,727 18,575 59,327 ——- ——- ——- ——- ——– Total product sales, net 111,194 145,882 154,157 165,501 576,734 Royalties 7,790 9,010 8,172 8,997 33,969 ——- ——- ——- ——- ——– Total revenue 118,984 154,892 162,329 174,498 610,703 ——- ——- ——- ——- ——– Expenses: Cost of sales 9,752 11,934 12,378 13,200 47,264 Selling, general and administrative 137,027 126,232 112,152 84,416 459,827 Research and development 13,874 18,413 18,035 15,494 65,816 ——- ——- ——- ——- ——– Total expenses 160,653 156,579 142,565 113,110 572,907 ——- ——- ——- ——- ——– Net income (loss) $(41,669) $(1,687) $19,764 $61,388 $37,796 ======= ======= ======= ======= ======== (1) Cialis(R) is a registered trademark of Lilly ICOS LLC.
(2) Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.
Lilly ICOS LLC
CONTACT: Terra Fox of Eli Lilly and Company, +1-317-276-5795; or LacyFitzpatrick of ICOS Corporation, +1-425-415-2207