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Cubist Reports Fourth Quarter And Full Year 2012 Financial Results

Stocks in this article: CBST

As previously announced, fourth quarter 2012 total U.S. CUBICIN® (daptomycin for injection) net product revenues were $216.0 million, up 14% over fourth quarter 2011, and full year U.S. CUBICIN net product revenues were $809.2 million, up 16% over 2011. Cubist’s share of full year 2012 international CUBICIN revenues was $50.5 million, which represents a 38% increase over $36.7 million in 2011. Service revenues for our co-promote of DIFICID® (fidaxomicin) for the fourth quarter were $3.7 million and were $23.2 million for the full year of 2012, a 246% increase over full year 2011. ENTEREG® (alvimopan), acquired through our acquisition of Adolor Corporation in December 2011, net product revenues were $10.9 million in the fourth quarter of 2012 and $40.2 million for the full year, a 21% pro forma increase over the full year of 2011.

As of December 31, 2012, Cubist had $979.4 million in cash, cash equivalents and investments. The total number of Cubist’s common shares outstanding as of December 31, 2012, was 64,713,695.

Pipeline Update and Milestones

Cubist enters 2013 with a robust pipeline. Product candidate status and upcoming milestones include:

Ceftolozane/tazobactam – a potential first-line therapy being studied for the treatment of certain serious Gram-negative bacterial infections, including those caused by multi-drug resistant Pseudomonas aeruginosa.

  • Top-line data for ceftolozane/tazobactam Phase 3 trials in complicated intra-abdominal infections (cIAI) and complicated urinary tract infections (cUTI) are expected in the second half of 2013. This timing reflects a reduction of patient enrollment requirements based on Cubist’s recent consultation with the Food and Drug Administration (FDA).
  • Cubist anticipates filing a New Drug Application (NDA) for ceftolozane/tazobactam in cUTI and cIAI within approximately six months of announcing top-line results from the Phase 3 trials.
  • In December, the FDA granted ceftolozane/tazobactam a Qualified Infectious Disease Product (QIDP) designation, qualifying it for priority review and fast-track status at the FDA. If ultimately approved by the FDA, ceftolozane/tazobactam would also receive a five-year extension of Hatch-Waxman exclusivity.
  • Cubist expects to initiate the Phase 3 program in ventilator-associated bacterial pneumonia (VABP) for ceftolozane/tazobactam around mid-year 2013.

Surotomycin (CB-315) – a rapidly bactericidal lipopeptide being studied as a potential treatment for patients with a severe and sometimes life-threatening diarrhea caused by Clostridium difficile known as C. difficile-associated diarrhea (CDAD).

  • In December, the FDA granted surotomycin a QIDP designation, qualifying it for priority review and fast-track status at the FDA. If ultimately approved by the FDA, surotomycin would also receive a five-year extension of Hatch-Waxman exclusivity.
  • In July, Cubist enrolled its first patient in its Phase 3 trials designed to evaluate the difference in clinical response rates at the end-of-therapy in patients treated with surotomycin versus oral vancomycin, as well as the safety of surotomycin in subjects with CDAD.
  • Cubist is targeting filing an NDA for surotomycin in 2015.

Bevenopran (CB-5945) a novel mu-opioid receptor antagonist being studied as a potential treatment for chronic opioid-induced constipation (OIC).

  • In October, Cubist initiated a Phase 3 long-term safety trial of bevenopran.
  • Cubist plans to commence three Phase 3 efficacy trials in the first half of 2013.

CB-625 – this non-opioid product candidate is a novel small molecule antagonist of the human TRPA1 channel being studied as a potential treatment for post-surgical pain.

  • Phase 1 clinical trials for CB-625, discovered in a collaboration between Cubist and Hydra Biosciences, are on-going.

Recent Company Highlights

  • Announced that Thomas J. DesRosier will join Cubist as Senior Vice President, Chief Legal Officer and Secretary; Robert J. Perez was promoted to President and Chief Operating Officer (COO); Thomas Rollins was appointed Senior Vice President of Program and Portfolio Management; Michael Tomsicek was promoted to Senior Vice President and Deputy Chief Financial Officer; and Patrick Vink was appointed Senior Vice President and General Manager of International Business;
  • Announced the appointment of Alison Lawton and Jane E. Henney, M.D. to the Board of Directors;
  • Announced Cubist’s five-year goals – the Building Blocks of Growth – for top- and bottom-line growth, future pipeline developments, and cultural goals that will position Cubist to deliver long-term, sustainable growth;
  • Celebrated Cubist Pharmaceuticals’ 20 th anniversary; and
  • Opened a 104,000 square-foot expansion to Cubist’s research and development facility.

Use of Non-GAAP Financial Measures

Non-GAAP net income and adjusted operating income and non-GAAP diluted EPS exclude non-cash or non-operational activities. As a result, Cubist uses these measures to assess and analyze its operational results and trends and to make financial and operational decisions. Cubist also believes these non-GAAP financial measures are useful to investors because they provide greater transparency regarding Cubist’s operating performance. These non-GAAP financial measures should not be considered an alternative to measurements required by GAAP, such as net income, operating income and EPS, and should not be considered measures of Cubist’s liquidity. In addition, these non-GAAP financial measures are unlikely to be comparable with non-GAAP information provided by other companies. Reconciliations between non-GAAP financial measures and GAAP financial measures are included in the tables accompanying this press release after the unaudited condensed consolidated financial statements.

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