Loss for MedImmune is $19 million

Shortfall for 3rd quarter attributed to costs of regaining Ethyol rights

October 19, 2001|By Julie Bell | Julie Bell,SUN STAFF

MedImmune Inc. reported a third-quarter loss yesterday of $19 million, largely because of costs associated with regaining the rights to its cancer drug Ethyol.

The Gaithersburg-based biopharmaceutical company reported, however, that net earnings for the first nine months of the year rose 59 percent to $50 million, or 23 cents per diluted share, on revenue of $326 million. That compares with net earnings of $32 million, or 14 cents a diluted share, on revenue of $302 million in the first nine months of last year.

"We continue to make excellent progress in building our business," MedImmune Chief Executive Officer David M. Mott said in a statement. "We completed the reacquisition of Ethyol rights in the U.S., and the expansion of our oncology business unit ahead of schedule."

Ethyol is a drug designed to reduce toxic side effects associated with chemotherapy and radiation. MedImmune announced last month that it would reacquire rights to the drug from Mountain View, Calif.-based Alza Corp. six months earlier than planned and said earnings would be lower than expected as a result.

The reacquisition has been accomplished; so, as of Oct. 1, MedImmune began recording 100 percent of the sales of Ethyol, up from the 35 percent it previously recorded when it transferred stockpiles of the drug to Alza.

For the third quarter, the company's net loss was 9 cents per diluted share on revenue of $47 million. In the year-ago quarter, the company recorded net earnings of $8 million, or 4 cents per diluted share, on revenue of $62 million. MedImmune sold $40 million worth of drugs in the quarter, down from $47 million in the year-ago period. The decrease primarily was attributed to the fact that the company stopped selling Ethyol to Alza and recorded a charge to revenue as it reacquired Alza's unsold Ethyol inventory Sept. 30.

Other third-quarter costs associated with the reacquisition include payments to Alza for the projected profit it would have made from Oct. 1 through March 31, 2002, and financing for expanded marketing.

Sales of MedImmune's biggest-selling drug, Synagis, were modest as usual in the third quarter, as the drug is sold to protect against a seasonal infant respiratory virus that typically doesn't appear in North America until September or October.

The company reported earnings after the close of the market yesterday. Its shares rose 94 cents to close at $37.59 on the Nasdaq stock market.

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