Alkermes (ALKS) Q4 Earnings & Revenues Surpass Estimates

Alkermes plc. (NASDAQ:ALKS) reported adjusted earnings of 34 cents per share in the fourth quarter of 2018, outperforming the Zacks Consensus Estimate of a loss of 6 cents. The bottom line also exceeded the adjusted earnings of 31 cents recorded in the year-ago quarter.

The company’s revenues of $315.8 million in the quarter increased 14.7% year over year. The top line beat the Zacks Consensus Estimate of $253 million.

Results were driven by strong growth in the company’s proprietary products — Vivitrol and Aristada. Net sales for Vivitrol and Aristada were $132.7 million in the quarter, reflecting 28% increase from the year-ago quarter.

Alkermes’ shares have lost 49% in the past year compared with the industry’s decline of 17.1%.

Revenues Rise

Manufacturing and royalty revenues from Risperdal Consta, Invega Sustenna/Xeplion and Invega Trinza/Trevicta were $81.4 million, up 4.1% year over year. The same from Ampyra/Fampyra were up 1.8% year over year to $38.8 million. Research and development revenues were $15.6 million, of which $14.4 million was related to the collaboration with Biogen Inc. (NASDAQ:BIIB) for BIIB098.

Vivitrol sales improved 11% year over year to $83.8 million.

Aristada sales came in at $48.8 million, up 72% year over year.

Costs Rise

Research and Development (R&D) expenses were $108.9 million, down 4.3% year over year.

Selling, General and Administrative (SG&A) expenses were $141.2 million, up 27.4% year over year.

Full-Year 2018 Results

For 2018, adjusted earnings came in at 61 cents per share compared with 17 cents in 2017.

Revenues in 2018 increased 21% year over year to $1.09 billion.

2019 Outlook

The company expects total revenues of $1.14-$1.19 billion, driven by anticipated growth of the company’s proprietary products and an expected $150-million milestone payment from Biogen in the fourth quarter, related to the potential FDA approval of diroximel fumarate (BIIB098).

The Zacks Consensus Estimate for 2019 revenues is $1.10 billion.

Alkermes expects Vivitrol sales to be $330-$350 million, while Aristada sales are anticipated to be $210-$230 million. The company expects R&D expenses to be $450-$480 million. Alkermes’ guidance for SG&A expenses is $590-$620 million.

Alkermes expects earnings per share to be 25-43 cents. The Zacks Consensus Estimate for 2019 earnings is 62 cents.

Pipeline Update

In November 2018, Alkermes announced positive top-line results from ENLIGHTEN-2, a pivotal phase III study of ALKS 3831 compared to Lilly’s (NYSE:LLY) Zyprexa (olanzapine) in patients with stable schizophrenia. In the study, ALKS 3831 met the pre-specified co-primary endpoints.

In December 2018, Alkermes and Biogen announced the submission of a new drug application (NDA) to the FDAfor diroximel fumarate, a novel oral fumarate in development for the treatment of relapsing forms of multiple sclerosis.

In January 2019, Alkermes received a Complete Response Letter from the FDA regarding the NDA for ALKS 5461, for the adjunctive treatment of major depressive disorder.

Zacks Rank & Another Key Pick

Alkermes currently carries a Zacks Rank #2 (Buy).

Another top-ranked stock in the biotech sector is Celgene Corporation (NASDAQ:CELG) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Celgene’s earnings per share estimates have moved up from $10.21 to $10.69 for 2019 and from $11.61 to $12.62 for 2020 in the past 60 days. The company delivered a positive earnings surprise in all the trailing four quarters, with average beat of 2.65%.

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