Lilly ICOS LLC Reports Results for Second Quarter of 2005 -
Quarterly net loss narrows to $1.7 million - - Worldwide sales of
Cialis(R), since launch, exceed $1 billion - BOTHELL, Wash. and
INDIANAPOLIS, Ind., July 21 /PRNewswire-FirstCall/ -- Lilly ICOS
LLC (Lilly ICOS) (NYSE:LLYNYSE:andNYSE:Nasdaq:NYSE:ICOS) is
releasing its financial results for the second quarter ended June
30, 2005. The Company has advanced to the point where it is on the
cusp of profitability as a result of sustained sales growth and
reductions in marketing and selling expenses. Worldwide sales of
Cialis(R) (tadalafil)(1) in the second quarter of 2005 totaled
$190.9 million, an increase of 39% compared to $137.2 million in
the second quarter of 2004. U.S. sales of Cialis were $71.1 million
in the second quarter of 2005, compared to $50.8 million in the
second quarter of 2004. Cialis Net Sales (unaudited):
---------------------------- (in millions) Three Months Ended Six
Months Ended June 30, June 30, ------------------ ----------------
2005 2004 2005 2004 -------- -------- -------- ------- Lilly ICOS
Territories: United States 71.1 $50.8 $113.9 $83.6 Europe (2) 60.9
45.3 117.2 81.6 Canada and Mexico 13.8 8.9 26.0 14.8 --------
-------- -------- ------- Total Lilly ICOS 145.8 105.0 257.1 180.0
Lilly Territories 45.1 32.2 84.0 65.5 -------- -------- --------
------- Worldwide Total $190.9 $137.2 $341.1 $245.5 ========
======== ======== ======= "It is exciting that, in 2005, cumulative
worldwide sales of Cialis passed the $1 billion mark," stated John
Bamforth, Lilly Global Marketing Director. "The progress we have
made supports our long-standing belief that men value the benefits
that Cialis offers." Paul Clark, ICOS Chairman, President and CEO
stated, "The global launches of Cialis have been successful. Our
strategic plan has focused on gaining market share. In the U.S.,
market share of total prescriptions of Cialis increased 160 basis
points in the second quarter of 2005, compared to the previous
quarter, to 22.7%(3). In every major Lilly ICOS market, Cialis has
far surpassed Levitra(R) (vardenafil HC1). Additionally, Cialis has
passed Viagra(R) (sildenafil citrate) in a number of countries,
including France -- and is closing in on it in several others.
Cialis captured 31.7% of aggregate market share across Europe,
Canada and Mexico in May 2005."(4) Financial Results For the three
months ended June 30, 2005, Lilly ICOS reported a net loss of $1.7
million, compared to a net loss of $70.5 million for the three
months ended June 30, 2004. The decreased net loss results from an
increase of $43.4 million in total revenue, combined with a $25.4
million reduction in total expenses. Total revenue for the second
quarter of 2005 was $154.9 million, compared to $111.4 million for
the second quarter of 2004. Revenue for the 2005 period includes
$9.0 million in royalties on sales reported by Lilly, compared to
$6.4 million in royalty revenue for the second quarter of 2004. The
increase in overall Lilly ICOS revenue reflects the continued
growth of Cialis in the Lilly ICOS territories since its 2003
introduction, as well as its global expansion in countries where it
is sold by Lilly. In December 2004, Lilly ICOS began to reduce U.S.
wholesaler inventories of Cialis to targeted levels and, by early
February 2005, was party to new agreements with its U.S.
wholesalers. As a result, it is estimated that approximately $27
million of U.S. wholesaler inventory reductions of Cialis occurred
during the first quarter of 2005. No significant additional
wholesaler inventory reductions are anticipated. Selling, general
and administrative expenses decreased $31.6 million from the second
quarter of 2004, to $126.2 million in the second quarter of 2005.
The decrease is primarily due to the planned higher level of sales
and marketing expenses, in the first half of 2004, following the
November 2003 U.S. launch of Cialis. Research and development
expenses were $18.4 million in the second quarter of 2005, compared
to $15.1 million in the second quarter of 2004. The increase is
primarily due to incremental costs associated with pursuing
additional indications for tadalafil, including benign prostatic
hyperplasia and pulmonary arterial hypertension. For the six months
ended June 30, 2005, Lilly ICOS reported a net loss of $43.4
million, compared to a net loss of $209.3 million for the six
months ended June 30, 2004. The decrease is due to increases in
Lilly ICOS revenues since the 2003 Cialis launch and a reduction of
sales and marketing expenses. About Lilly ICOS LLC Lilly ICOS LLC,
a joint venture equally owned by ICOS Corporation and Eli Lilly and
Company, is marketing Cialis for the treatment of erectile
dysfunction in North America and Europe. 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, 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 management 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 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. -Selected financial data
follows- Lilly ICOS LLC Condensed Consolidated Statements of
Operations (in thousands) (unaudited) Three Months Ended Six Months
Ended June 30, June 30, -------------------- --------------------
2005 2004 2005 2004 --------- --------- --------- --------- Revenue
Product sales, net $145,882 $105,000 $257,076 $180,017 Royalties
9,010 6,449 16,800 13,101 --------- --------- --------- ---------
Total revenue 154,892 111,449 273,876 193,118 --------- ---------
--------- --------- Expenses Cost of sales 11,934 8,982 21,686
15,555 Selling, general and administrative 126,232 157,838 263,259
352,891 Research and development 18,413 15,119 32,287 33,946
--------- --------- --------- --------- Total expenses 156,579
181,939 317,232 402,392 --------- --------- --------- --------- Net
loss $(1,687) $(70,490) $(43,356) $(209,274) ========= =========
========= ========= Lilly ICOS LLC SUMMARIZED OPERATING RESULTS (in
thousands) (unaudited) 2005 --------------------------------- Q1 Q2
TOTAL --------- ---------- ---------- Revenue: Product sales, net:
United States $42,744 $71,118 $113,862 Europe 56,264 60,925 117,189
Canada and Mexico 12,186 13,839 26,025 --------- ----------
---------- 111,194 145,882 257,076 Royalties 7,790 9,010 16,800
--------- ---------- ---------- Total revenue 118,984 154,892
273,876 --------- ---------- ---------- Expenses: Cost of sales
9,752 11,934 21,686 Selling, general and administrative 137,027
126,232 263,259 Research and development 13,874 18,413 32,287
--------- ---------- ---------- Total expenses 160,653 156,579
317,232 --------- ---------- ---------- Net loss $(41,669) $(1,687)
$(43,356) ========= ========== ========== Lilly ICOS LLC SUMMARIZED
OPERATING RESULTS (in thousands) (unaudited) 2004
------------------------------------------------- Q1 Q2 Q3 Q4 TOTAL
-------- -------- -------- -------- --------- Revenue: Product
sales, net: United States $32,807 $50,768 $70,226 $52,783 $206,584
Europe 36,356 45,301 43,414 52,859 177,930 Canada and Mexico 5,854
8,931 9,380 13,063 37,228 -------- -------- -------- --------
--------- 75,017 105,000 123,020 118,705 421,742 Royalties 6,652
6,449 6,210 6,809 26,120 -------- -------- -------- --------
--------- Total revenue 81,669 111,449 129,230 125,514 447,862
-------- -------- -------- -------- --------- Expenses: Cost of
sales 6,573 8,982 10,173 10,338 36,066 Selling, general and
administrative 195,053 157,838 123,222 130,398 606,511 Research and
development 18,827 15,119 17,203 16,169 67,318 -------- --------
-------- -------- --------- Total expenses 220,453 181,939 150,598
156,905 709,895 -------- -------- -------- -------- --------- Net
loss $(138,784) $(70,490) $(21,368) $(31,391) $(262,033) ========
======== ======== ======== ========= (1) Cialis(R) is a registered
trademark of Lilly ICOS LLC. All other trademarks are the property
of their respective owners. (2) Austria, Belgium, Denmark, Finland,
France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg,
Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the
United Kingdom. (3) IMS Health, IMS National Prescription Audit
Plus(TM), (based on total prescriptions) April, May and June 2005.
(4) Based on calculations using IMS Health, IMS MIDAS (PDE5
inhibitor tablets from wholesalers to pharmacies) May 2005. (Logo:
http://www.newscom.com/cgi-bin/prnh/20040122/LILLYICOSLOGO )
http://www.newscom.com/cgi-bin/prnh/20040122/LILLYICOSLOGO
DATASOURCE: Lilly ICOS LLC CONTACT: Phil Belt, Lilly,
+1-317-276-2506; or Lacy Fitzpatrick, ICOS, +1-425-415-2207
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