Celgene Q3 2010 Earnings Call Transcript

Celgene Q3 2010 Earnings Call Transcript
Publish date:

Celgene (CELG)

Q3 2010 Earnings Call

October 28, 2010 9:00 am ET


Robert Hugin - Chief Executive Officer, President, Secretary and Director

Tim Smith - Director of Investor Relations

Jacqualyn Fouse - Chief Financial Officer and Senior Vice President


Geoffrey Porges - Bernstein Research

Robyn Karnauskas - Deutsche Bank AG

Joel Sendek - Lazard Capital Markets LLC

Howard Liang - Leerink Swann LLC

Yaron Werber - Citigroup Inc

Maged Shenouda - Stifel, Nicolaus & Co., Inc.

Christopher Raymond - Robert W. Baird & Co. Incorporated

Eric Schmidt - Cowen and Company, LLC

Mark Schoenebaum - ISI Group Inc.

Gene Mack - Soleil Securities Group, Inc.

Rachel McMinn - BofA Merrill Lynch

Geoffrey Meacham - JP Morgan Chase & Co




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Good day, ladies and gentlemen, and welcome to Celgene's Third Quarter Conference Call. [Operator Instructions] I would now like to introduce your host for today's conference, Tim Smith, Director of Investor Relations.

Tim Smith

Good morning, everyone. I would like to welcome you to Celgene's Third Quarter 2010 Conference Call. The press release reporting our third quarter financial and operating results was issued earlier this morning and is also available on our corporate website. In addition, today's conference call webcast will include a presentation which you can access by going to the Investor Relations section of our website at www.celgene.com.

Joining me are Jackie Fouse, our Chief Financial Officer; Bob Hugin, our Chief Executive Officer; and Dr. Sol Barer, our Executive Chairman.

Before we start, we want to remind you that our discussions during this conference call will include forward-looking statements. All such forward-looking statements include the effects of the acquisition of Abraxis BioScience unless noted. Our actual results, performance or achievements could be materially different from those projected by these forward-looking statements.

The factors that could cause actual results, performance or achievements to differ from our forward-looking statements are discussed in our filings with the Securities and Exchange Commission, such as our Form 10-K, 10-Q, and 8-K reports.

Given these risks and uncertainties, you are cautioned not to place undue reliance on our forward-looking statements.

Also, our discussions during this conference call will include certain non-GAAP financial measures. Non-GAAP financial measures provide investors and management with supplemental measures of operating performance and trends that facilitate comparisons between periods before and after certain items that would not otherwise be apparent on a GAAP basis. Reconciliations of these non-GAAP financial measures to the most comparable GAAP measures are available as part of our earnings releases on Celgene's website at www.celgene.com in the Investor Relations section.

I will now turn the call over to our Chief Executive Officer, Bob Hugin.

Robert Hugin

Thank you, Tim. Good morning, and thank you for joining us this morning as we review our third quarter results and the significant progress that we have made since we last spoke in July. Earlier this morning, we announced record operating and financial results. These results reflect a strong momentum in our businesses and the excellent execution by our teams.

Numerous important developments in the quarter have the potential to further accelerate our growth prospects, delivering both short- and long-term value to our shareholders. Before Jackie and I talk about the specific operating and financial results of the quarter, let me highlight some of these milestones.

On October 15, we closed the Abraxis acquisition, adding ABRAXANE and the proprietary nab technology platform to our portfolio. This acquisition provides Celgene with an immediate commercial presence in solid tumor oncology and substantially expands our solid tumor pipeline. We're off to a good start launching Celgene oncology. I'll talk more about the transaction in a few minutes.

Our confidence to expand our therapeutic focus into oncology is a direct result of the outstanding performance of all functions and geographies in our core Hematology business. In our commercial operations, key business metrics are encouraging across markets, and we continue to expand globally into new territory such as Japan, Russia and China. Our deep and diverse pipeline is a direct result of our sustained R&D investment over the last decade. We now have 25 pivotal trials investigating REVLIMID, VIDAZA, ISTODAX, pomalidomide, apremilast and now ABRAXANE across a number of diseases with high unmet medical needs. With numerous major clinical and regulatory milestones later this year and next, we are beginning to realize the benefits of these investments.

In addition to the strong progress in hematology and oncology, I'm also excited about the significant accomplishments we have made in our inflammation and immunology programs. We now have six compounds and multiple research programs ongoing. This work is highlighted by the initiation this year of four pivotal studies investigating apremilast in psoriasis and psoriatic arthritis.

We're fortunate to be in a position of strength as we seek to maximize our opportunities and effectively manage through the challenges of uncertain economic times and dynamic markets.

Before I turn the call over to Jackie, I would like to thank her and her team for their leadership and superb execution of our recent $1.25 billion debut debt offering. Thank you.

Let me now turn the call over to Jackie.

Jacqualyn Fouse

Thank you, Bob. Good morning, everyone. And thank you for joining us on our call this morning. It's a pleasure to be here on my first earnings call with Celgene, and I'm happy to begin my comments today with some highlights of our income statement results for what was a record quarter for the company.

Starting with the top line. Non-GAAP total revenue for the third quarter was $908 million, a 31% increase over the third quarter of 2009. This contributed to year-to-date non-GAAP revenue growth of 33%. The strong growth was driven by global unit sales growth in our key products REVLIMID and VIDAZA.

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