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Alkermes Inc. Reports Operating Results (10-Q)

November 04, 2010 | About:
10qk

10qk

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Alkermes Inc. (ALKS) filed Quarterly Report for the period ended 2010-09-30.

Alkermes Inc. has a market cap of $1.16 billion; its shares were traded at around $11.89 with and P/S ratio of 6.4. ALKS is in the portfolios of Jeff Auxier of Auxier Focus Fund, Steven Cohen of SAC Capital Advisors, Bruce Kovner of Caxton Associates, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Net loss for the three months ended September 30, 2010 was $7.7 million, or $0.08 per common share, basic and diluted, as compared to a net loss of $8.7 million, or $0.09 per common share, basic and diluted, for the three months ended September 30, 2009. Net loss for the six months ended September 30, 2010 was $21.1 million, or $0.22 per common share, basic and diluted, as compared to a net loss of $18.9 million, or $0.20 per common share, basic and diluted, for the six months ended September 30, 2009. Revenues for the three and six months ended September 30, 2010 were driven by strong manufacturing and royalty revenues from RISPERDAL CONSTA. Worldwide sales of RISPERDAL CONSTA by Janssen were $377.7 million and $733.4 million for the three and six months ended September 30, 2010, respectively, an increase of 7.1% and 4.7% from the three and six months ended September 30, 2009, respectively.

On July 1, 2010, we redeemed the remaining non-recourse RISPERDAL CONSTA secured 7% notes (the non-recourse 7% Notes) for $45.6 million. As a result of this transaction, we recorded charges of $1.4 million relating to the write-off of the unamortized portion of deferred financing costs and $0.8 million primarily related to the premium paid on the redemption of the non-recourse 7% Notes. We expect to save $3.2 million in interest and accretion expense through the previously scheduled maturity date of January 1, 2012 as a result of redeeming the non-recourse 7% Notes.

Substantially all of our royalty revenues for the three and six months ended September 30, 2010 and 2009 were related to sales of RISPERDAL CONSTA. Under our license agreements with Janssen, we record royalty revenues equal to 2.5% of Janssens net sales of RISPERDAL CONSTA in the period that the product is sold by Janssen. RISPERDAL CONSTA royalty revenues for the three and six months ended September 30, 2010 were based on RISPERDAL CONSTA sales of $377.7 million and $733.4 million, respectively. RISPERDAL CONSTA royalty revenues for the three and six months ended September 30, 2009 were based on RISPERDAL CONSTA sales of $352.6 million and $700.3 million, respectively. See Part I, Item 3. Quantitative and Qualitative Disclosures about Market Risk for information on foreign currency exchange rate risk related to RISPERDAL CONSTA revenues.

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