MedImmune has record quarterly revenue

However, one-time costs from purchase of Aviron result in $1.1 billion loss

April 26, 2002|By Dan Thanh Dang | Dan Thanh Dang,SUN STAFF

MedImmune Inc., a Gaithersburg company that develops drugs for infections and autoimmune diseases, said yesterday that it had record first-quarter revenue, though one-time costs from its purchase of California-based Aviron resulted in a $1.1 billion loss.

The loss amounted to $4.53 per share. That compared with earnings of $78.7 million, or 36 cents per share, for the same period in 2001. Excluding one-time items related to the Aviron acquisition, cash earnings were $74 million, or 29 cents per share, for the three months that ended March 3, meeting expectations of analysts surveyed by Thompson Financial/First Call.

Revenue - driven by strong sales of Synagis, a treatment for infant lung infections - increased 34 percent to $330 million from $245 million in the first quarter of 2001.

"They had a terrific quarter. From a cash earnings perspective, they did report a profit," said Ron Renaud, senior analyst at Bear Stearns Cos. "The biotech sector right now has traded under a big cloud of uncertainty because a lot of products are being held up at the U.S. Food and Drug Administration, which has been asking for more details and scrutinizing products more.

"But the outlook for MedImmune's next product, FluMist, is pretty strong. If it gets approved, we expect MedImmune to be one of the better-performing biotechnology stocks. We're optimistic that it'll be approved in time for the next flu season."

The FDA is expected to make a decision by July 10 on FluMist, a nasally administered flu vaccine that the company acquired when it bought Aviron for $1.7 billion in stock.

Shares of MedImmune closed at $34.59 on the Nasdaq stock market, down 42 cents.

During an analysts conference yesterday morning, MedImmune's Chief Executive Officer David M. Mott said, "I'm pleased to report that 2002 has started out very well. Both Synagis and Ethyol are running well ahead of our expectations, boosting our confidence and our ability to achieve our long-term objectives for these products. ... We are making excellent progress toward being ready to launch FluMist."

Product sales grew 36 percent to $321 million in the first quarter of this year from $235 million in the same period in 2001. Sales of Synagis, which has been approved for marketing in Japan, hit $293 million, up 33 percent from $221 million in the first quarter of 2001.

Sales of Ethyol, a treatment to protect chemotherapy patients from certain toxic side effects, were $18 million.

The company projected that second-quarter earnings would be lower than in the first quarter because sales of Synagis occur primarily during the fourth and first quarters. The "seasonality of Synagis," Mott said, will result in a cash loss in the second quarter of 12 cents to 13 cents per share. MedImmune is predicting revenue of $55 million to $60 million.

Company officials also said FluMist has the potential to generate almost $1 billion in sales, but if it fails to get FDA approval in time for this year's flu season, $100 million of assumed revenue for 2002 would be eliminated.

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