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Celgene's Q1 Keeps Momentum Rolling

By Keith Speights - Apr 25, 2013 at 11:16AM

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Will Q1 results slow down Celgene's momentum? Not likely.

Celgene (CELG) appears to be keeping its momentum rolling. The biotech reported solid first-quarter results before the market opened on Wednesday. Shares fluctuated slightly in early trading. Here are the highlights.

By the numbers
Adjusted diluted earnings per share for the quarter jumped 27% year over year to $1.37, beating the average analyst estimate of $1.35 per share. This impressive gain stemmed from 22% higher net income than in the first quarter of 2012 combined with a repurchase of 4.2 million shares in the most recent quarter.

On a GAAP basis, net income for the first quarter of this year was $385 million, or $0.89 per diluted share. That reflects a small decrease from net income of $402 million, or $0.90 per diluted share, in the first quarter of 2012.

Celgene reported revenue of $1.46 billion in the first quarter, a 15% increase compared to last year's result. This figure narrowly missed the average analyst revenue estimate of $1.47 billion. Net product sales were also 15% higher, totaling $1.43 billion.

The company announced $367 million in operating cash flow for the quarter. As of March 31, Celgene's cash and marketable securities totaled slightly more than $3.5 billion.

Behind the numbers
Celgene's first-quarter success came from nearly all of its products experiencing solid gains. Most importantly, its top-selling drug, Revlimid, continued to do very well. The company reported Revlimid sales of a little more than $1 billion in the first quarter, a 16% increase year over year.

Vidaza sales came in at $204 million for the first quarter, a 10% gain compared to the same quarter in 2012. The company reported increased demand in the U.S., Europe, and Latin America.

Sales for Abraxane were up 18% year over year and totaled $123 million. The U.S. portion of sales increased 15% after the launch of the drug at the end of 2012 for treating non-small cell lung cancer.

Celgene reported Pomalyst sales of $29 million after receiving U.S. regulatory approval on Feb. 8 of this year. This total also included $7 million of European sales from early-access programs.

The only decline among the biotech's products came from Thalomid. Sales for the older drug dropped 26% year over year to $57 million.

Looking ahead
Investors had reason to cheer Celgene's earnings guidance for 2013. The company raised its full-year adjusted earnings per share guidance to $5.55 to $5.65  per share from $5.50 to $5.60 per share. This new range reflects a 14% jump compared to 2012.

The company has several potential catalysts coming over the next several months. The FDA is scheduled to make its decision by June 5 on expanding the use of Revlimid for treating patients with relapsed and refractory mantle cell lymphoma after prior therapy that included bortezomib. 

Celgene anticipates a decision by European regulators on Pomalyst as a third-line treatment for multiple myeloma in the third quarter of this year. New Drug Applications have also been submitted for Abraxane in treating pancreatic cancer and apremilast in treating psoriatic arthritis.

I continue to be bullish on Celgene's prospects. Blockbuster drug Revlimid is still going strong. Its other drugs have great potential. The biotech's momentum should keep rolling.

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