Millennium's Loss Widens and Forecast Comes Down

Losses grew at Millennium Pharmaceuticals (MLNM Quote - Cramer on MLNM - Stock Picks) in the third quarter as the biotech firm spent more on clinical testing of new drugs and came up a bit short on revenue.

The Cambridge, Mass.-based company reported a third-quarter net loss of $98.9 million, or 35 cents per share, compared to a net loss of $25.2 million, or 4 cents per share in the year-ago quarter.

Excluding merger and debt-related charges, Millennium lost $89.1 million, or 31 cents per share, in the third quarter. This falls below Wall Street expectations of a net loss of 27 cents per share, as compiled by Thomson Financial/First Call.

Third-quarter revenue grew 16% to $95.8 million, slightly below Wall Street expectations of around $97 million.

Breaking it down, third-quarter sales of the drug Integrilin rose 31% to $76.9 million, of which Millennium records $45 million as revenue due to a co-marketing agreement with Schering-Plough. Millennium gained control of Integrilin, which is given to heart disease patients undergoing angioplasty, when it acquired Cor Therapeutics last year.

Millennium reiterated the previous forecast of 2002 Integrilin sales of $300 million, or 30% growth over last year.

So-called strategic alliance revenue -- money paid to Millennium by drug development partners -- totaled $50.7 million in the third quarter. The company's previous guidance called for 2002 strategic alliance revenue of $250 million. The nine-month total now stands at $144.1 million, forcing the company Tuesday to warn that it will fall short of projections, which in turn will cause higher-than-expected losses in 2002.

The most promising drug in Millennium's pipeline is Velcade, which is being developed as a possible treatment for multiple myeloma and other cancers. Multiple clinical trials involving Velcade helped boost spending on research and development in the third quarter to $140.5 million, or 42% higher than the year-ago period.