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EntreMed Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: November 14, 2012 12:06PM
EntreMed Inc. (ENMD) filed Quarterly Report for the period ended 2012-09-30. Entremed, Inc. has a market cap of $36.9 million; its shares were traded at around $1.51 with and P/S ratio of 19.
Highlight of Business Operations:Revenues. Our 2012 revenues will likely result solely from Celgene’s sales of Thalomid®. We earn royalties once sales of Thalomid exceed approximately $225 million annually, pursuant to a 2001 agreement with Royalty Pharma. Thalomid® is distributed and sold by Celgene and/or its affiliates, and thus, we have no control over sales of Thalomid® or the amount, if any, of royalty payments we will receive. We recorded royalty revenue of $0 and $8,852 during the three and nine month periods ended September 30, 2011. This royalty related to certain sales by Celgene of Thalomid in 2010 that were not reported to Royalty Pharma until the second quarter of 2011, at which time we received our share of the applicable royalty payment. We do not expect to record royalty revenue in fiscal 2012 until the fourth quarter.
We expect that the majority of our 2012 revenues will continue to be from royalties on the sales of Thalomid®. Thalomid® is sold by a third-party and is subject to competition from other products and generic drugs, and we have no control over such party’s sales efforts or the resources devoted to Thalomid® sales. In 2011 and 2010, we earned royalty-sharing revenue in the amount of $1,941,000 and $3,449,000, respectively. There can be no assurance on the future trends of Thalomid® sales and the amount of revenue we will receive and record in 2012. Based on the trend, we expect annual sales of Thalomid® in 2012 to continue to decrease, which will result in a reduction in our revenues in 2012.
Stocks Discussed: ENMD,