IDEC Pharmaceuticals Reports Third Quarter 2000 Results

(BW HealthWire) — IDEC Pharmaceuticals Corporation (Nasdaq:IDPH) today announced its financial results for the third quarter ended September 30, 2000. Total revenues for the third quarter ended September 30, 2000 were $41.2 million compared to $30.2 million for the third quarter of 1999. Net income was $16.1 million, or $0.30 per share on a diluted basis, compared to $10.7 million, or $0.21 per share on a diluted basis (as adjusted for a 2-for-1 stock split in December 1999), for the same period in 1999.

Revenues for the third quarter of 2000 included $36.8 million recorded for IDEC’s joint business arrangement with Genentech, Inc. for the commercialization of Rituxan(R) (Rituximab) compared to $25.9 million for the third quarter of 1999.

“We are extremely pleased with the $115.5 million of Rituxan U.S. net sales recorded in the third quarter of 2000,” said William R. Rohn, chief operating officer. “Compared to the third quarter of 1999, we realized a more than 64 percent increase in U.S. net sales of Rituxan. We believe this sales performance is indicative of Rituxan’s broadening acceptance within the oncology community as a beneficial therapy for non-Hodgkin’s lymphoma.”

Rituxan Revenues

Rituxan is copromoted in the United States by IDEC and Genentech. U.S. net sales of Rituxan, as recorded by Genentech, in the third quarter of 2000 were $115.5 million compared to $70.2 million for the same period in 1999.

Revenues from unconsolidated joint business for the quarter ended September 30, 2000 reflect the financial results from the U.S. marketing of Rituxan by IDEC and Genentech. Revenues from unconsolidated joint business for the second quarter of 2000 consist of IDEC’s share of pretax copromotion profits, reimbursement from Genentech for IDEC’s Rituxan-related sales force and development expenses and royalty income from F. Hoffmann-La Roche Ltd. on the sales of Rituxan outside the United States. According to its agreement with Genentech, IDEC’s share of pretax copromotion profits rose during the second quarter of 2000 to a higher percentage upon achievement of an annual fixed profit target by the Rituxan joint business arrangement.

Operating Costs and Expenses

Operating costs and expenses for the third quarter of 2000 increased to $24.6 million from $20.2 million for the third quarter of 1999. The higher 2000 operating expenses are the result of increased manufacturing development and drug supply expenses for IDEC’s products under development, personnel expenses and facility expenses, which were offset by decreased clinical trial expenses.

Year-to-date operating costs and expenses increased by $19.5 million, from $51.7 million in 1999 compared to $71.2 million in 2000, primarily due to the aforementioned expenses plus increased contract manufacturing expenses by third-parties and increased legal and patent filing fees.

IDEC ended the third quarter of 2000 with $275.0 million in cash, cash equivalents and marketable securities, an increase of $28.7 million from $246.3 million at the end of 1999. Increases in cash stem primarily from operations and stock purchases under employee stock plans. These increases in cash were offset by the purchase of a 60-acre site in Oceanside, California for a planned large scale manufacturing facility. With several potential drugs approaching late stages of clinical development, IDEC has developed a plan that will allow it to provide needed capacity for products moving through IDEC’s pipeline.

Trials Begun in IDEC-151 with Methotrexate

On August 7, 2000 IDEC announced that it has begun a multi-center, Phase II clinical trial with the company’s PRIMATIZED(R), non-depleting, anti-CD4 monoclonal antibody, Clenoliximab (IDEC-151). The double-blind, randomized, placebo-controlled study will evaluate the safety and clinical activity of multiple doses of the investigational agent when used in combination with methotrexate in patients with moderate to severe rheumatoid arthritis. Approximately 130 patients will be randomized to receive either IDEC-151 plus methotrexate or placebo plus methotrexate.

Clenoliximab targets the CD4 receptor on helper T cells, which are purported to play a key role in the pathogenesis of rheumatoid arthritis. Once bound to CD4, Clenoliximab is believed to regulate helper T-cell function, but without depleting T cells and affecting other important immune system functions.

“Completed Review” Received from FDA

On September 27, 2000 IDEC announced it had received a “completed review” letter from the U.S. Food and Drug Administration (FDA) indicating that it has completed review of a supplemental Biological License Application (sBLA) for Rituxan(R) (Rituximab). IDEC submitted the sBLA in late 1999 based on studies in non-Hodgkin’s lymphoma (NHL) of Rituxan which include: 1) treatment of patients with bulky disease, 2) dosing of up to eight weekly doses per treatment, and 3) multiple courses of treatment.

During the review process, IDEC provided the FDA with proposed revisions and additions to the Rituxan Package Insert (PI). In its “completed review” letter, the FDA commented only on the details of the PI. Based on the FDA’s comments, IDEC will begin discussions with the FDA with the objective of finalizing revisions to the Rituxan PI.


ZEVALIN is an investigational therapy seeking to combine the targeting power of monoclonal antibodies with the cancer-killing ability of radiation. During the third quarter, IDEC continued to make progress with its Biologics Licensing Application (BLA) for ZEVALIN, which is targeted for a fourth quarter filing with the Food and Drug Administration (FDA).

Rituxan, was discovered by IDEC and is jointly developed by IDEC, Genentech Inc., F. Hoffmann-La Roche Ltd. of Switzerland and Zenyaku Kogyo Co. Ltd. of Japan. Roche has marketing rights to Rituximab outside of the United States and Japan.

IDEC Pharmaceuticals focuses on the commercialization and development of targeted therapies for the treatment of cancer and autoimmune diseases. IDEC’s antibody products act chiefly through immune system mechanisms, exerting their effect by binding to specific, readily targeted immune cells in the patient’s blood or lymphatic systems. For a menu of IDEC’s current news releases and quarterly reports or to retrieve a specific release, call (888) 329-2309. On the Internet check the News Center at IDEC’s website:

The statements made in this press release contain certain forward-looking statements that involve a number of risks and uncertainties. Actual events or results may differ from IDEC’s expectations. For example, the timing, success and cost of preclinical research and clinical studies, the timing, acceptability and review periods for regulatory filings, the timing of and ability to obtain regulatory approval of products, the achievement of future product sales, the level of manufacturing performance and the risk factors listed from time to time in IDEC’s SEC filings including but not limited to its Annual Report on Form 10-K for the year ended December 31, 1999 and Form 10-Q for the quarter ended June 30, 2000, may affect the actual results achieved by IDEC. These forward-looking statements represent the company’s judgment as of the date of this release. The company disclaims, however, any intent or obligation to update these forward-looking statements.

IDEC Pharmaceuticals and Rituxan are registered U.S. trademarks of the company. ZEVALIN is a trademark of the company. The company’s headquarters is located at 3030 Callan Road, San Diego, CA 92121.

IDEC Pharmaceuticals’ press releases are available at no charge through Business Wire’s News on Demand Plus. For a menu of IDEC’s current press releases and quarterly reports or to retrieve a specific release, call 888/329-2309. On the Internet, check the News Center at IDEC’s website http//

IDEC PHARMACEUTICALS CORPORATION AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) Three months Nine months ended Sept. 30, ended Sept. 30, ---------------- ------------------ 2000 1999 2000 1999 -------- ------- ------- --------- Revenues: Revenues from unconsolidated joint business $36,778 $25,899 $89,973 $66,223 Contract revenues 4,400 4,291 13,992 6,772 License fees -- -- -- 13,000 ----------- -------- ---------- -------- Total revenues 41,178 30,190 103,965 85,995 Operating costs and expenses: Manufacturing costs -- 4,789 2,134 9,675 Research and development 18,008 10,798 49,768 28,152 Selling, general and administrative 6,576 4,622 19,253 13,875 ----------- -------- ---------- -------- Total operating costs and expenses 24,584 20,209 71,155 51,702 ----------- -------- ---------- -------- Income from operations 16,594 9,981 32,810 34,293 Interest income, net 2,788 1,305 7,053 2,944 ----------- -------- ---------- -------- Income before income tax provision 19,382 11,286 39,863 37,237 Income tax provision 3,332 557 6,889 1,791 ----------- -------- ---------- -------- Net income $16,050 $10,729 $32,974 $35,446=====================================Earnings per share (a): Basic $ 0.36 $ 0.26 $ 0.74 $ 0.86 Diluted $ 0.30 $ 0.21 $ 0.63 $ 0.71 Shares used in calculation of earnings per share (a): Basic 44,952 41,558 44,305 41,054 Diluted 52,876 51,082 52,499 49,858 (a) Per share data for the three and nine months ended September 30, 1999 have been restated to reflect a two-for-one stock split in December 1999. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) Sept. 30, Dec. 31, 2000 1999 ----------- ---------- (unaudited) (audited) Assets Current assets: Cash, cash equivalents and securities available-for-sale $274,983 $246,286 Inventories 212 2,400 Other current assets 43,732 29,833 --------- -------- Total current assets 318,927 278,519 Property and equipment, net 45,802 20,822 Other non-current assets 17,902 7,733 --------- -------- Total assets $382,631 $307,074=================Liabilities and Stockholders' Equity Current liabilities $ 20,375 $ 15,616 Non-current liabilities 136,769 131,480 Stockholders' equity 225,487 159,978 --------- -------- Total liabilities and stockholders' equity $ 382,631 $307,074

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CONTACT: IDEC Pharmaceuticals Corporation