The Medicines Company Reports Second Quarter and First Half 2011 Results

27 Jul 2011
Quarterly Net Revenues Rise 9% to $119.6 Million vs 2010

PARSIPPANY, NJ, Jul 27, 2011 (MARKETWIRE via COMTEX) --

The Medicines Company (NASDAQ: MDCO), a global pharmaceutical company focused on advancing the treatment of critical care patients through the delivery of innovative, cost-effective medicines, today announced results for the second quarter and first half of 2011. Highlights include:

--  A 9% increase in net revenues in the second quarter of 2011 to $119.6
    million from $110.1 million in the comparable 2010 period.
--  Increased investments in R&D as Phase III trials for cangrelor and
    oritavancin accelerated
--  As a result, net income for the second quarter of 2011 was $11.4
    million, or $0.21 per share, compared with net income of $15.4
    million, or $0.29 per share, for the second quarter of 2010; net
    income for the first half of 2011 was $35.7 million, or $0.66 per
    share, compared with net income of $24.9 million, or $0.47 per share,
    for the first half of 2010.

R&D portfolio highlights for the second quarter included positive Phase IIa clinical trial results from MDCO-2010 in cardiac surgery patients and pre-clinical results from key mode-of-action and toxicology studies for MDCO-216. Detailed data from these Phase IIa and preclinical studies are expected to be presented at major medical meetings in the fourth quarter of 2011. The Company also continued enrollment in Phase III trials of oritavancin and cangrelor. For cangrelor, the BRIDGE trial studying a prolonged infusion was completed with data also expected to be presented in 4Q 2011.

Clive Meanwell, Chairman and Chief Executive Officer, stated, "Second quarter and first half year 2011 results reaffirm our ability to execute our strategy of growing net revenue, investing aggressively in our R&D portfolio; and making stepwise investments to extend our geographic reach while still generating significant positive cash flow. Our second quarter and first half year 2011 results evidence real growth consistent with our short and medium-term goals. Looking ahead, we expect continued revenue growth led by Angiomax(R) | Angiox(R) (bivalirudin) for years to come, and robust progress in R&D and geographic reach."

Dr. Meanwell added, "We were very excited by multiple R&D developments in the second quarter that show the vibrancy and longer term commercial promise of our R&D programs -- all of which are expected to generate products which serve the same customer channel we are building for Angiomax and Cleviprex -- namely, acute and intensive care hospitals worldwide. We expect continuous news flow because of the breadth and depth of our technologies."

Financial highlights for the second quarter of 2011:

--  Net revenue increased by 9% to $119.6 million for the second quarter
    of 2011 from $110.1 million in the second quarter of 2010.
    --  Angiomax U.S. sales increased by 7% to $112.0 million in the
        second quarter of 2011 compared with $104.4 million in the second
        quarter of 2010.
    --  Angiomax/Angiox international net revenue in the second quarter of
        2011 increased by 27% to $7.3 million compared with $5.8 million
        in the second quarter of 2010.
--  Net income for the second quarter of 2011 was $11.4 million, or $0.21
    per share, compared with net income of $15.4 million, or $0.29 per
    share, for the second quarter of 2010.
--  Non-GAAP net income for the second quarter of 2011 was $13.2 million,
    or $0.24 per share, compared with non-GAAP net income of $18.3
    million, or $0.35 per share for the second quarter 2010. Non-GAAP net
    income excludes stock-based compensation expense and non-cash income
    taxes.

Financial highlights for the half of 2011:

--  Net revenue increased by 9% to $231.7 million for the first half of
    2011 from $212.2 million in the first half of 2010.
    --  Angiomax U.S. sales increased by 8% to $217.0 million in the first
        half of 2011 compared with $200.0 million in the first half of
        2010.
    --  Angiomax/Angiox international net revenue in the first half of
        2011 increased by 27% to $14.4 million compared with $11.4 million
        in the first half of 2010.
--  Net income for the first half of 2011 was $35.7 million, or $0.66 per
    share, compared with net income of $24.9 million, or $0.47 per share,
    for the first half of 2010.
--  Non-GAAP net income for the first half of 2011 was $47.7 million, or
    $0.88 per share, compared with non-GAAP net income of $30.8 million,
    or $0.58 per share for the first half of 2010. Non-GAAP net income
    excludes stock-based compensation expense and non-cash income taxes.

The following table provides reconciliations between GAAP and non-GAAP net income for second quarter (Q2) and first half of 2011 and 2010. Non-GAAP net income excludes stock-based compensation expense and non-cash income taxes:


                                                   Non-cash
                                                  (Provision)
                     Reported     Stock-Based       Benefit        Non-GAAP
                     GAAP Net    Compensation     for Income         Net
(in millions)         Income        Expense          Taxes        Income(1)
                   ---------------------------------------------------------

Q2 2011            $      11.4  $          3.2  $         (1.4)  $      13.2

Q2 2010            $      15.4  $          2.3  $          0.5   $      18.3

1H 2011            $      35.7  $          5.4  $          6.6   $      47.7

1H 2010            $      24.9  $          5.1  $          0.9   $      30.8

Note: Amounts may not sum due to rounding.
(1) Excluding stock-based compensation expense and the non-cash (provision)
 benefit for income taxes.


Reconciliations between GAAP and non-GAAP fully diluted earnings per share (EPS) for the second quarter (Q2) and first half of 2011 and 2010 are provided in the following table:


                                                    Non-cash
                                  Stock-Based     (Provision)
                     Reported     Compensation    Benefit for      Non-GAAP
(per share)          GAAP EPS       Expense       Income Taxes     EPS (1)
                   ---------------------------------------------------------

Q2 2011            $      0.21  $          0.06  $       (0.03)  $      0.24

Q2 2010            $      0.29  $          0.04  $        0.01   $      0.35

1H 2011            $      0.66  $          0.10  $        0.12   $      0.88

1H 2010            $      0.47  $          0.10  $        0.02   $      0.58

Note: Amounts may not sum due to rounding.
(1) Excluding stock-based compensation expense and the non-cash (provision)
 benefit for income taxes.


The Company believes that presenting the non-GAAP information contained in the financial tables and in this press release assists investors and others in gaining a better understanding of the Company's core operating results and future prospects, expected growth rates or forecasted guidance, stock-based compensation expense and non-cash income taxes. Management uses this non-GAAP information, in addition to the GAAP information, as the basis for measuring the Company's core operating performance and comparing such performance to that of prior periods and to the performance of its competitors. Such measures are also used by management in its financial and operating decision-making. Non-GAAP information is not meant to be considered superior to or a substitute for the Company's results of operations prepared in accordance with GAAP. A reconciliation of GAAP results with non-GAAP results may also be found in the attached financial tables.

There will be a conference call with management today at 8:30 a.m. Eastern Time to discuss financial results and operational developments. The conference call will be available via phone and webcast. The webcast can be accessed at The Medicines Company website at www.themedicinescompany.com.

The dial in information is listed below: Domestic Dial In: 800-638-4930 International Dial In: 617-614-3944 Passcode for both dial in numbers: 15988273

Replay is available from 11:30 a.m. Eastern Time following the conference call through August 10, 2011. To hear a replay of the call dial 888-286-8010 (domestic) and 617-801-6888 (international). Passcode for both dial in numbers is 84976700.

About The Medicines Company The Medicines Company (NASDAQ: MDCO) provides medical solutions to improve health outcomes for patients in acute and intensive care hospitals worldwide. These solutions comprise medicines and knowledge that directly impact the survival and well being of critically ill patients. The Medicines Company's website is www.themedicinescompany.com.

Statements contained in this press release about The Medicines Company that are not purely historical, and all other statements that are not purely historical, may be deemed to be forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, the words "believes," "anticipates" and "expects" and similar expressions, including the Company's preliminary revenue results, are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements. Important factors that may cause or contribute to such differences include the extent of the commercial success of Angiomax, the Company's ability to develop its global operations and penetrate foreign markets, whether the Company's products will advance in the clinical trials process on a timely basis or at all, whether the Company will make regulatory submissions for product candidates on a timely basis, whether its regulatory submissions will receive approvals from regulatory agencies on a timely basis or at all, whether physicians, patients and other key decision makers will accept clinical trial results, risks associated with the establishment of international operations, and such other factors as are set forth in the risk factors detailed from time to time in the Company's periodic reports and registration statements filed with the Securities and Exchange Commission including, without limitation, the risk factors detailed in the Company's Quarterly Report on Form 10-Q filed on, May 10, 2011, which are incorporated herein by reference. The Company specifically disclaims any obligation to update these forward-looking statements.


                           The Medicines Company
              Condensed Consolidated Statements of Operations
                                (unaudited)

(in thousands, except per share data)           Three months ended June 30,
                                               ----------------------------
                                                    2011           2010
                                               ----------------------------

Net revenue                                    $     119,591  $     110,135
Operating expenses:
  Cost of revenue                                     37,830         33,568
  Research and development                            26,536         20,575
  Selling, general and administrative                 41,420         39,409
                                               -------------  -------------
    Total operating expenses                         105,786         93,552
                                               -------------  -------------

Income from operations                                13,805         16,583
  Other income (loss)                                     61           (117)
                                               -------------  -------------

Income before income taxes                            13,866         16,466
Provision for income taxes                            (2,426)        (1,040)
                                               -------------  -------------

Net income                                     $      11,440  $      15,426
                                               =============  =============

Basic earnings per common share                $        0.21  $        0.29
                                               =============  =============
Shares used in computing basic earnings per
 common share                                         53,441         52,819
                                               =============  =============

Diluted earnings per common share              $        0.21  $        0.29
                                               =============  =============
Shares used in computing diluted earnings per
 common share                                         54,314         52,924
                                               =============  =============




                           The Medicines Company
              Condensed Consolidated Statements of Operations
                                (unaudited)

(in thousands, except per share data)              Year to Date June 30,
                                               ----------------------------
                                                    2011           2010
                                               ----------------------------

Net revenue                                    $     231,728  $     212,223
Operating expenses:
  Cost of revenue                                     73,400         62,337
  Research and development                            50,328         37,452
  Selling, general and administrative                 79,348         85,530
                                               -------------  -------------
    Total operating expenses                         203,076        185,319
                                               -------------  -------------

Income from operations                                28,652         26,904
  Legal settlement                                    17,984              -
  Other income (loss)                                    872           (428)
                                               -------------  -------------
Income before income taxes                            47,508         26,476
Provision for income taxes                           (11,827)        (1,618)
                                               -------------  -------------
Net income                                     $      35,681  $      24,858
                                               =============  =============

Basic earnings per common share                $        0.67  $        0.47
                                               =============  =============
Shares used in computing basic earnings per
 common share                                         53,343         52,658
                                               =============  =============

Diluted earnings per common share              $        0.66  $        0.47
                                               =============  =============
Shares used in computing diluted earnings per
 common share                                         54,223         52,823
                                               =============  =============




                            The Medicines Company
                    Condensed Consolidated Balance Sheets


                                                June 30,       December 31,
(in thousands)                                    2011             2010
                                            ---------------  ---------------
                                              (unaudited)
                   ASSETS
Cash, cash equivalents and available for
 sales securities                           $       283,629  $       246,644
Accrued interest receivable                             895            1,279
Accounts receivable, net                             67,008           46,551
Inventory                                            29,161           25,343
Prepaid expenses and other current assets             8,908            4,804
                                            ---------------  ---------------
    Total current assets                            389,601          324,621
                                            ---------------  ---------------

Fixed assets, net                                    19,298           20,662
Intangible assets, net                               81,740           82,925
Restricted cash                                       5,783            5,778
Deferred tax assets                                  27,286           25,197
Goodwill                                             14,671           14,671
Other assets                                            296              270
                                            ---------------  ---------------
    Total assets                            $       538,675  $       474,124
                                            ===============  ===============

    LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities                         $       103,841  $        85,370
  Contingent purchase price                          27,416           25,387
  Other Long Term Liabilities                         5,854            5,769
Stockholders' equity                                401,564          357,598
                                            ---------------  ---------------
    Total liabilities and stockholders'
     equity                                 $       538,675  $       474,124
                                            ===============  ===============




The Medicines Company
Reconciliation of GAAP to non-GAAP Measures
(All amounts in thousands, except per share amounts)
(unaudited)

                                     Three Months Ended June 30,
                          -------------------------------------------------
                                                 2011
                          -------------------------------------------------
                                                                  Non-GAAP
                                                    Non-cash        (4)
                                      Stock-Based      Tax           As
                            GAAP(1)  Compensation   Provision     Adjusted
                          ---------- ------------- ----------    ----------
Net revenue               $  119,591 $        -    $        -    $  119,591

Operating expenses:
  Cost of revenue             37,830        (35)(2)         -        37,795
  Research and development    26,536       (531)(2)         -        26,005
  Selling, general and
   administrative             41,420     (2,648)(2)         -        38,772
                          ---------- ----------    ----------    ----------
    Total operating
     expenses                105,786     (3,214)            -       102,572

Income from operations        13,805      3,214             -        17,019

  Legal settlement                 -          -             -             -
  Other income                    61          -             -            61
                          ---------- ----------    ----------    ----------
Income before income taxes    13,866      3,214             -        17,080
  Provision for income
   taxes                      (2,426)         -        (1,437)(3)    (3,863)
                          ---------- ----------    ----------    ----------
Net income                    11,440      3,214        (1,437)       13,217

Basic earnings per common
 share                    $     0.21 $     0.06    $    (0.03)   $     0.25
                          ========== ==========    ==========    ==========

Shares used in computing
 basic earnings per common
 share                        53,441     53,441        53,441        53,441
                          ========== ==========    ==========    ==========

Diluted earnings per
 common share             $     0.21 $     0.06    $    (0.03)   $     0.24
                          ========== ==========    ==========    ==========

Shares used in computing
 diluted earnings per
 common share                 54,314     54,314        54,314        54,314
                          ========== ==========    ==========    ==========


Note: Amounts may not sum due to rounding.
(1) GAAP Results
(2) Non-cash stock compensation expense
(3) Non-cash income taxes
(4) Non-GAAP Results




The Medicines Company
Reconciliation of GAAP to non-GAAP Measures
(All amounts in thousands, except per share amounts)
(Unaudited)

                                     Three Months Ended June 30,
                         --------------------------------------------------
                                                2010
                         --------------------------------------------------
                                                                  Non-GAAP
                                                     Non-cash       (4)
                                     Stock-Based        Tax          As
                           GAAP(1)  Compensation     Provision    Adjusted
                         ---------- -------------   ----------   ----------
Net revenue              $  110,135 $          -    $        -   $  110,135

Operating expenses:
  Cost of revenue            33,568          (72)(2)         -       33,496
  Research and
   development               20,575         (442)(2)         -       20,133
  Selling, general and
   administrative            39,409       (1,823)(2)         -       37,586
                         ---------- ------------    ----------   ----------
    Total operating
     expenses                93,552       (2,337)            -       91,215

Income from operations       16,583        2,337             -       18,920

  Other (loss)/income          (117)           -             -         (117)
                         ---------- ------------    ----------   ----------
  Income before income
   taxes                     16,466        2,337             -       18,803
  (Provision for)
   Benefit from income
   taxes                     (1,040)           -           531(3)      (509)
                         ---------- ------------    ----------   ----------
Net income                   15,426        2,337           531       18,294

Basic earnings per
 common share            $     0.29 $       0.04    $     0.01   $     0.35
                         ========== ============    ==========   ==========

Shares used in computing
 basic earnings per
 common share                52,819       52,819        52,819       52,819
                         ========== ============    ==========   ==========

Diluted earnings per
 common share            $     0.29 $       0.04    $     0.01   $     0.35
                         ========== ============    ==========   ==========

Shares used in computing
 diluted earnings per
 common share                52,924       52,924        52,924       52,924
                         ========== ============    ==========   ==========


Note: Amounts may not sum due to rounding.
(1) GAAP Results
(2) Non-cash stock compensation expense
(3) Non-cash income taxes
(4) Non-GAAP Results




The Medicines Company
Reconciliation of GAAP to non-GAAP Measures
(All amounts in thousands, except per share amounts)
(unaudited)

                                      Six Months Ended June 30,
                         --------------------------------------------------
                                              2011
                         --------------------------------------------------
                                                                  Non-GAAP
                                                     Non-cash       (4)
                                     Stock-Based        Tax          As
                           GAAP(1)  Compensation     Provision    Adjusted
                         ---------- -------------   ----------   ----------
Net revenue              $  231,728 $          -    $        -   $  231,728

Operating expenses:
  Cost of revenue            73,400          (78)(2)         -       73,322
  Research and
   development               50,328         (959)(2)         -       49,369
  Selling, general and
   administrative            79,348       (4,438)(2)         -       74,910
                         ---------- ------------    ----------   ----------
    Total operating
     expenses               203,076       (5,475)            -      197,601

Income from operations       28,652        5,475             -       34,127

  Legal settlement           17,984            -             -       17,984
  Other income                  872            -             -          872
                         ---------- ------------    ----------   ----------
Income before income
 taxes                       47,508        5,475             -       52,983
  (Provision for)
   Benefit from income
   taxes                    (11,827)           -         6,554(3)    (5,273)
                         ---------- ------------    ----------   ----------
Net income                   35,681        5,475         6,554       47,710

Basic earnings per
 common share            $     0.67 $       0.10    $     0.12   $     0.89
                         ========== ============    ==========   ==========

Shares used in computing
 basic earnings per
 common share                53,343       53,343        53,343       53,343
                         ========== ============    ==========   ==========

Diluted earnings per
 common share            $     0.66 $       0.10    $     0.12   $     0.88
                         ========== ============    ==========   ==========

Shares used in computing
 diluted earnings per
 common share                54,223       54,223        54,223       54,223
                         ========== ============    ==========   ==========


Note: Amounts may not sum due to rounding.
(1) GAAP Results
(2) Non-cash stock compensation expense
(3) Non-cash income taxes
(4) Non-GAAP Results




The Medicines Company
Reconciliation of GAAP to non-GAAP Measures
(All amounts in thousands, except per share amounts)
(Unaudited)

                                      Six Months Ended June 30,
                         --------------------------------------------------
                                                2010
                         --------------------------------------------------
                                                                  Non-GAAP
                                                     Non-cash       (4)
                                     Stock-Based        Tax          As
                           GAAP(1)  Compensation     Provision    Adjusted
                         ---------- -------------   ----------   ----------
Net revenue              $  212,223 $          -    $        -   $  212,223

Operating expenses:
  Cost of revenue            62,337         (161)(2)         -       62,176
  Research and
   development               37,452       (1,238)(2)         -       36,214
  Selling, general and
   administrative            85,530       (3,681)(2)         -       81,849
                         ---------- ------------    ----------   ----------
    Total operating
     expenses               185,319       (5,080)            -      180,239

Income from operations       26,904        5,080             -       31,984

  Other (loss)/income          (428)           -             -         (428)
                         ---------- ------------    ----------   ----------
  Income before income
   taxes                     26,476        5,080             -       31,556
  (Provision for)
   Benefit from income
   taxes                     (1,618)           -           857(3)      (761)
                         ---------- ------------    ----------   ----------
Net income                   24,858        5,080           857       30,795

Basic earnings per
 common share            $     0.47 $       0.10    $     0.02   $     0.58
                         ========== ============    ==========   ==========

Shares used in computing
 basic earnings per
 common share                52,658       52,658        52,658       52,658
                         ========== ============    ==========   ==========

Diluted earnings per
 common share            $     0.47 $       0.10    $     0.02   $     0.58
                         ========== ============    ==========   ==========

Shares used in computing
 diluted earnings per
 common share                52,823       52,823        52,823       52,823
                         ========== ============    ==========   ==========


Note: Amounts may not sum due to rounding.
(1) GAAP Results
(2) Non-cash stock compensation expense
(3) Non-cash income taxes
(4) Non-GAAP Results

Contact:
Michael Mitchell
The Medicines Company
973-290-6000
investor.relations@themedco.com


SOURCE: The Medicines Company

mailto:investor.relations@themedco.com