It's been an eventful year for Allergan (AGN +0.00%). That's to be expected, with AbbVie announcing in June that it plans to acquire the drugmaker for $63 billion.
Allergan added another twist to its eventful 2019 when it announced its second-quarter results before the market opened on Tuesday. Here's what you need to know from the Q2 update.
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By the numbers
Allergan announced Q2 revenue of $4.09 billion, a slight decline from the $4.12 billion in the year-ago quarter. But revenue was still higher than the average analysts' estimate of $3.94 billion.
The drugmaker announced a net loss in the second quarter of $5.37 per share under generally accepted accounting principles (GAAP). This represented significant deterioration from the net loss of $1.39 per share in the year-ago quarter.
On the other hand, the bottom line looked much better on a non-GAAP (adjusted) basis. The company reported Q2 adjusted net income of $4.38 per share, versus $4.42 in the prior-year period. This beat the average analysts' earnings estimate of $4.35 per share.
Behind the numbers
There were plenty of positives in the second quarter. Botox cosmetic sales increased by 6.7% year over year to $252.4 million, with therapeutic sales for the drug climbing 5.9% to $447 million. Vraylar sales soared 71.7% to $196.1 million. Viibryd/Fetzima sales jumped 24.3% year over year to $107.8 million. Sales for Lo Loestrin increased 13.8% to $145.5 million.
But there were also quite a few weak spots in Q2. CoolSculpting sales fell 27.1% from the prior-year period to $78.9 million. Sales for Alloderm dropped 5.5% to $101.2 million. Restasis net revenue slipped 2.3% to $310.9 million.
Allergan's wider net loss was primarily driven by higher expenses. Research and development costs increased nearly 15% to $447 million on a non-GAAP basis, while selling, general, and administrative expenses rose 2.5% to $1.16 billion. The company attributed the increases to higher direct-project spending related to product launches.
There were also several milestones in the second quarter:
- Food and Drug Administration approval for the expanded use of Vraylar in treating depressive episodes associated with bipolar 1 disorder in adults.
- FDA approval of Botox in treating pediatric patients 2 years and older with upper limb spasticity.
- FDA clearance for the CoolTone body contouring device.
Looking ahead
Allergan now expects revenue for full-year 2019 between $15.425 billion and $15.625 billion, up from its previous guidance of $15.125 billion to $15.425 billion. The company also projected a GAAP net loss per share for full-year 2019 greater than $12.03, compared with a net loss of greater than $5.70 provided in its previous outlook. Allergan continues to anticipate non-GAAP earnings per share of at least $16.55 for the year.
Look for lots of activity on the commercialization and regulatory fronts. Allergan plans to launch CoolTone in the second half of 2019. An FDA decision on Botox in treating pediatric patients with lower limb spasticity is expected by Q4 of this year. An approval for migraine drug ubrogepant is anticipated by December 2019. Allergan also expects the FDA to approve bimatoprost sustained-release in the first half of 2020.
In addition, a European decision for abicipar in treating neovascular age-related macular degeneration is expected in the second half of 2020.
And the big development for Allergan is the pending acquisition by AbbVie. That deal is expected to close in early 2020.
