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Millennium Targets First Profit

The company sees Velcade sales in the range of $225 million to $250 million this year.

Millennium Pharmaceuticals


says it's on track to reach profitability on a limited basis for the first time in the company's history this year.

The Cambridge, Mass., drug company expects to report a loss of between $95 million and $115 million in 2006, when calculated according to generally accepted accounting principles. However, it expects a non-GAAP profit of $5 million, compared with analysts' estimates of a $4.2 million loss.

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Millennium's non-GAAP estimates include expectations of higher sales of its multiple myeloma drug Velcade and lower research and development costs. Estimates don't include expected amortization costs of about $34 million, restructuring charges of between $25 million and $30 million and stock-based compensation expenses of $40 million to $50 million.

The company is targeting Velcade sales in the range of $225 million to $250 million this year, a 17% to 30% over last year, and royalty revenue between $115 million and $125 million.

Operating expenses, including research and development costs, as well as selling, general and administrative outlays, are expected to come in at $425 million, 30% below 2004, according to a company press release issued after the market closed Thursday.

By the end of the year, Millennium says it should be sitting on more than $500 million in cash, cash equivalents and marketable securities. In after-hours trading, shares of Millennium were down 3.4% at $9.71.