Actelion - Full Press Release
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`Media Relations > Media Releases 2004 > Full Press Release
`
`Click here for German Releases
`
`
`Actelion announces Full Year 2003 financial results
`
`Net revenue up 132% to CHF 307.5 million - Sales of Tracleer® continue to grow - Controlled
`increase of operating expenses by 88% to CHF 309.2 m - One-time impact of CHF 47 million In-
`Process R&D charge responsible for small operating loss of CHF 1.7 million - Pipeline with
`multiple late phase projects should support long-term growth
`
`ALLSCHWIL/BASEL, SWITZERLAND - 2 March 2004 - Actelion Ltd (SWX: ATLN) today announced
`its financial results for the year 2003. With net revenues of CHF 307.5 million (FY 2002: CHF 132.4
`m) and operating expenses of CHF 309.2 million (FY 2002: 164.5 m), the company reported an
`operating loss of CHF 1.7 million (FY 2002 loss: 32.0 m), mainly the result of a one-time In-Process
`R&D charge, related to the acquisition of Axovan in late 2003.
`
`The net loss was CHF 9.9 million (FY 2002 loss: CHF 52.1 m), which included the loss from
`discontinued operations (Hesperion) of CHF 7.5 m. Accordingly the loss per share (EPS) for 2003
`improved to CHF (0.46), compared to 2002 with a loss per share of CHF (2.45).
`
`
`
`
`
`On 31 December 2003, the company reported a gross cash position of CHF 258.8 million (31
`December 2003: CHF 116.2 million). In addition to generating a positive cash flow from operations in
`2003 of CHF 38.3 million, the company also benefited from net proceeds of CHF 140.9 million from
`the issuance of a senior unsecured zero coupon convertible bond in October 2003.
`
`Jean-Paul Clozel, M.D and Chief Executive Officer commented: "Indeed, the year 2003 has been a
`banner year for Actelion. Continued growth of Tracleer® sales has resulted in an important
`improvement in our operational performance, with substantial positive cash flow generated from
`operations."
`
`Jean-Paul Clozel added: "In the year 2003, we also improved our strategic position. We entered into
`an alliance with Merck in the area of renin inhibition, one of the most promising avenues in
`cardiovascular research, targeting high blood pressure. With the sale of the clinical services
`subsidiary, Hesperion, we are also completely focusing our efforts on our core business: the
`discovery, development and marketing of innovative, first-in-class
`
`
`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1061, p. 1 of 8
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`

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`Actelion - Full Press Release
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`Page 2 of 8
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`medicines. Additionally, with the acquisition of Axovan, we not only added another late-stage
`development project, but also welcomed 50 highly qualified research professionals to Actelion."
`
`Andrew J. Oakley, Chief Financial Officer commented: "With Tracleer® sales expected to grow
`further, I expect our operational performance will continue to improve throughout 2004. We will
`continue to invest substantially in R&D to further advance our promising clinical and pre-clinical
`pipeline."
`
`
`
`
`
`Financial result 2004 - US GAAP-compliant and Hesperion discontinued
`
`In CHF thousands
`Net Revenues
`Operating Expenses
`Operating Loss
`Net Loss
`Basic and diluted EPS in CHF
`Cash & cash equivalents
`
`Results FY 2003 Results FY 2002
`307(cid:31)544
`132(cid:31)448
`309(cid:31)208
`164(cid:31)487
`(1(cid:31)664)
`(32(cid:31)039)
`(9(cid:31)916)
`(52(cid:31)057)
`(0.46)
`(2.45)
`258(cid:31)770
`116(cid:31)201
`
`Variance
`175(cid:31)096
`144(cid:31)721
`n/a
`n/a
`n/a
`142(cid:31)569
`
`in %
`+132
`+88
`n/a
`n/a
`n/a
`n/a
`
`The Actelion Ltd consolidated financial statements for December 2003 can be found on
`http://www.actelion.com.
`
`In 2003, net revenues increased to CHF 307.5 million (2002: 132.5 million), including Tracleer® sales
`revenues of CHF 299.7 million (2002: 121.8 million), Zavesca® sales revenues of CHF 0.7 million
`(2002: not marketed yet) and contract revenues of CHF 7.2 million (2002: 10.6 million).
`
`
`
`
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`Operating expenses in line with business expansion
`
`Operating expenses increased to CHF 309.2 million (2002: 164.5 million), with marketing and
`advertising expenses at CHF 79.8 million (2002: 56.6 million), research and development costs at
`CHF 79.2 million (2002: 50.6 million) and selling, general and administration expenses at CHF 69.6
`million (2002: 43.0 million). Cost of goods sold of CHF 31.8 million (2002: 13.1 million) and
`amortization of intangible assets of CHF 1.8 million (2002: 1.2 million) are also recognized as part of
`operating expenses, as well as the one time In-Process R&D charge of CHF 47.0 million related to
`the acquisition of Axovan in October 2003.
`
`Going forward, both marketing and advertising, as well as selling, general and administration
`expenses, will increase to further strengthen the Tracleer® brand in the marketplace as well as
`preparing for the introduction of new indications and new innovative medicines. R&D expenditures
`are expected to increase in line with further enrollments into ongoing clinical trials and the initiation of
`
`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1061, p. 2 of 8
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`Actelion - Full Press Release
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`Page 3 of 8
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`new clinical programs and pre-clinical projects.
`
`The operating loss in 2003 amounted to CHF 1.7 million (2002 loss: 32.0 million).
`
`
`
`
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`Strengthened financial income through risk management
`
`The net loss of CHF 9.9 million (2002 loss: 52.1 million) includes interest income of CHF 0.9 million,
`interest expense of CHF 0.9 million, a non cash charge of CHF 1.5 m related to the issue of
`Actelion(cid:31)s convertible bond, foreign currency gains of CHF 2.6 m and income tax expense of CHF
`0.8 m as well as the loss from discontinued operations (Hesperion) of CHF 7.5 m.
`
`On 31 December 2003, the company held cash, cash equivalents of CHF 258.8 million. In the fourth
`quarter, Actelion issued a convertible bond raising net CHF 140.9 m.
`
`
`Tracleer® marketing ensuring long-term business growth
`
`At the end of 2003, Tracleer® was marketed in 18 countries worldwide, including all major
`pharmaceutical markets except Japan. In Australia, Tracleer® became commercially available on 1
`March 2004. In Japan and Taiwan, the regulatory review is ongoing.
`
`Christian Chavy, Actelion(cid:31)s President for the EMEA region (Europe, Latin America, Middle East and
`Africa) commented: "The outstanding growth in Tracleer® sales is the result of very strong and broad
`clinical data, as well as our major educational efforts to increase disease awareness and diagnosis of
`Pulmonary Arterial Hypertension. Our worldwide 143 sales representatives and 22 medical liaisons
`serviced an increasing number of physicians in treating patients with Tracleer®, creating new clinical
`data, educating non-specialists and identifying patients with PAH. Our well-established post-
`marketing surveillance system (PMS) provides physicians and their patients with additional comfort in
`using Tracleer®."
`
`
`Zavesca® not only launched in Europe but also in the US
`
`In spring 2003, Actelion launched Zavesca® first in the United Kingdom and in Germany. Actelion
`achieved an additional milestone with the approval of the drug in the United States of America by the
`FDA in August 2003, following a New Drug Application (NDA) amendment filed by Actelion on 7
`February 2003. The drug became commercially available in the United States in early January 2004.
`
`As expected, Zavesca® sales continue to grow slowly as a result of prolonged enrollment and
`reimbursement procedures. Accordingly, Zavesca® sales for 2003 were CHF 0.7 million.
`
`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1061, p. 3 of 8
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`Actelion - Full Press Release
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`Page 4 of 8
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`New clinical data on Tracleer® generated and presented
`
`In May 2003, Actelion announced at the American Thoracic Society (ATS) the analysis of long-term
`follow-up data of primary pulmonary hypertension (PPH) patients from Tracleer® pivotal registration
`studies. Tracleer® has been approved for use in pulmonary arterial hypertension (PAH) in both
`primary forms of the disease as well as PAH related to other diseases.
`
`In order to generate additional experience and data in specific patient populations, Actelion has
`initiated several post-approval Phase IV studies. In April 2003, results of the combination trial
`BREATHE-2 (Bosentan Randomized trial of Endothelin Antagonist THErapy for Pulmonary
`Hypertension-2) evaluating Tracleer® in patients with severe PPH or PAH due to scleroderma treated
`with intravenous epoprostenol were presented at the meeting of the International Society of Heart and
`Lung Transplantation (ISHLT).
`
`In September 2003, results of a study assessing Tracleer® in the treatment of PAH related to HIV
`(human immunodeficiency virus) infection was announced at the annual European Society of
`Cardiology meeting (ESC). Analysis of the open-label study BREATHE-4 showed a statistically
`significant improvement in hemodynamic parameters, exercise capacity (6-minute walk test),
`functional status and quality of life compared to baseline after 16 weeks of treatment with Tracleer®.
`
`Clinical development in areas of high unmet medical needs
`
`
`
`In Clinical Development Actelion is focusing its efforts on endothelin-related diseases in a number of
`areas of high unmet medical need. In detail, the trials expanding the potential indications for the use
`of Tracleer® are:
`
`(cid:122) Tracleer® in idiopathic (BUILD-1) and scleroderma-related (BUILD-2) Pulmonary Fibrosis:
`Enrollment ongoing, results expected in late 2005 (BUILD-1) and early 2006 (BUILD-2)
`(cid:122) Tracleer® in Digital Ulcers (RAPIDS-2): Enrollment ongoing, results expected in late 2005
`(cid:122) Tracleer® in Class II PAH patients (EARLY): Start in Q3 2004, results expected in early 2006
`(cid:122) Tracleer® in Metastatic Melanoma (Proof-of-Concept study): Recruitment completed, results
`on schedule for Q2 2004
`
`The trials currently evaluating VeletriTM (tezosentan) are:
`
`(cid:122) VeletriTM in Acute Heart Failure (VERITAS-1 and -2): Enrollment ongoing, first futility interim
`analysis expected in June 2004, results expected in early 2005
`(cid:122) VeletriTM in Hepatorenal Syndrome (Proof-of-Concept studies): Results expected in Q2 2004
`
`The encouraging phase IIa results of the endothelin receptor antagonist clazosentan in the prevention
`of vasospasm following surgery for cerebral bleeding events (Subarachnoid Hemorrhage) are
`currently being discussed with regulatory agencies worldwide. If successful, a phase II/III trial could
`
`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`Actelion - Full Press Release
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`start in Q3 2004.
`
`Zavesca®, which has already been launched in a number of markets, is being evaluated in lipid-
`storage disorders other than type 1 Gaucher(cid:31)s disease such as Type 3 Gaucher, Niemann-Pick type
`C and Late Onset of Tay-Sachs disease. The enrollment of the trials is ongoing and results will be
`available during 2005.
`
`In addition, clinical testing of the first orally active urotensin-II receptor antagonist, which has a wide
`range of potential indications, is in progress. Two proof-of-concept trials have been initiated in Type II
`diabetes patients with renal failure. Results are expected in late 2004.
`
`Approaching new therapies in drug discovery
`
`Actelion is currently pursuing several projects in advanced stage that have the potential to satisfy
`important unmet medical needs in cardiovascular, central nervous system and oncology indications.
`After several years of chemical optimization work, the Actelion research team has now arrived at
`potent, orally active renin inhibitors, with high oral bioavailability. Renin is the critical enzyme at the
`beginning of the biochemical cascade of the renin-angiotensin system involved in many pathological
`processes. An alliance with Merck is currently focusing on the selection of a first clinical candidate for
`potential indications such as renal failure, heart failure and hypertension.
`
`
`
`
`
`Although work was well in progress on potent orexin receptor antagonists in 2002, a major
`breakthrough came about during 2003, when the first orally active compounds were discovered.
`Substances that block the G-protein-coupled orexin receptors hold promise as novel sleep and
`appetite regulators. Pre-clinical development of a candidate for the therapy of sleep disorders is
`ongoing.
`
`Also strong fourth quarter 2003
`
`In CHF thousands
`Net Revenues
`Operating Expenses
`Operating Loss
`Net Loss
`Basic and diluted EPS in CHF
`Cash & cash equivalents
`
`Results Q4 2003 Results Q3 2003
`93(cid:31)796
`82(cid:31)140
`127(cid:31)623
`64(cid:31)171
`(33(cid:31)827)
`17(cid:31)969
`(37(cid:31)120)
`16(cid:31)163
`(1.71)
`0.75
`258(cid:31)770
`136(cid:31)639
`
`Variance
`11(cid:31)656
`63(cid:31)452
`n/a
`n/a
`n/a
`122(cid:31)131
`
`in %
`+14
`+99
`n/a
`n/a
`n/a
`n/a
`
`The fourth quarter added further momentum to Actelion(cid:31)s financial performance. On a quarter-to-
`quarter basis, net revenues increased by 14 percent to CHF 93.8 million (Q3 2003: 82.1 m).
`
`Tracleer® revenues increased by 14 percent to CHF 91.4 million (Q3 2003: 80.3 m) while Zavesca®
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`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`Actelion - Full Press Release
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`Page 6 of 8
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`revenues increased only slightly to CHF 0.4 million (Q3 2003: 0.2 m).
`
`In the fourth quarter operating expenses increased by 99 percent to CHF 127.6 million (Q3 2003:
`64.2 m). Marketing and advertising expenses were CHF 22.8 m, an increase of 15% compared to the
`previous quarter (Q3 2003: CHF 19.8 m). Research and Development expenses in Q4 2003 were
`CHF 22.2 m, an increase of 17% compared to the previous quarter (Q3 2003: CHF 18.9 m). In Q4
`2003 selling, general and administrative expenses were CHF 25.7 m, an increase of 62% compared
`to the previous quarter (Q3 2003: CHF 16.0 m).
`
`Operating expenses of the fourth quarter of 2003 also included a one-time CHF 47.0 million in-
`process R&D charge related to the acquisition of Axovan, as well as cost of goods sold of CHF 9.5 m
`(Q3 2003: CHF 9.0 m) and amortization of intangible assets of CHF 0.5 million (Q3 2003: CHF 0.4
`m).
`
`
`
`In Q4 2003, operating loss was CHF 33.8 m compared to an operating profit of CHF 18.0 m in Q3
`2003. Net loss was CHF 37.1 m compared to a net profit of CHF 16.2 m in Q3 2003. Loss per share
`for Q4 2003 was CHF (1.71), compared to CHF 0.75 in Q3 2003.
`
`NOTE TO THE EDITOR:
`
`Actelion Ltd will hold an Analyst & Media day today to further comment on its financial performance
`and its current marketing efforts for Tracleer® in today(cid:31)s approved indication, PAH. On the same
`day, the company will also provide a full update on its significant current and future research and
`development programs.
`
`
`
`
`
`Analyst & Media Conference: 2 March 2004, 09.30 am CET (Media) and 12.30 pm CET (Analysts),
`Unique Conference Center, Airport Zurich
`
`
`
`
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`NOTE TO THE SHAREHOLDERS:
`
`The annual general meeting of shareholders approving the Business Report of the year ending
`December 31, 2003 will be held on April 30, 2004.
`
`Shareholders holding more than 1 million CHF worth of shares (i.e. 400'000 shares), being entitled to
`add items to the agenda of the general meeting of shareholders, are invited to send in proposals, if
`any, for the annual general meeting of April 30, 2004 to Actelion Ltd, att. General Counsel,
`Gewerbestrasse 16, CH-4123 Allschwil, to arrive no later than March 19, 2004. Any proposal
`
`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`received after such deadline will be disregarded.
`
`In order to attend and vote at the annual general meeting of shareholders, shareholders must be
`registered in the company's shareholders register by April 2, 2004 at latest.
`
`Please note that annual reports will be available by the end of March 2004.
`
`###
`
`Actelion Ltd
`Actelion Ltd is a biopharmaceutical company with its corporate headquarter in Allschwil/Basel,
`Switzerland. Actelion's first drug Tracleer®, an orally available dual endothelin receptor antagonist,
`has been approved as a therapy for pulmonary arterial hypertension. Actelion markets Tracleer®
`through its own subsidiaries in key markets worldwide, including the United States (based in South
`San Francisco), the European Union as well as Canada and Switzerland. Actelion, founded in late
`1997, is a leading player in innovative science related to the endothelium - the single layer of cells
`separating every blood vessel from the blood stream. Actelion focuses on the discovery, development
`and marketing of innovative drugs for significant unmet medical needs. Actelion shares are traded on
`the SWX Swiss Exchange (ticker symbol: ATLN).
`
`For further information please contact:
`
`Actelion Ltd, Gewerbestrasse 16, CH-4123 Allschwil
`
`
`
`Investor Contact
`
`Media Contact
`
`Roland Haefeli
`
`Peter Engel
`
`+41 61 487 34 81
`+1 650 624-6936
`+41 61 487 36 28
`
`
`
`
`
`http:// www.actelion.com
`
`Videocast - Live and replay on demand
`
`Actelion videocasts it(cid:31)s Analyst Day Conference. On the Web, you may either follow the call live or
`have the call replayed later on demand. If you follow the videocast live, you may submit questions via
`email.
`
`To access the videocast, simply visit the link on our homepage http://www.actelion.com/ for further
`information.
`
`http://www.actelion.com/Apps/WebObjects/Actelion.woa/wa/dp?name=mrDetailEn&xmlsource=http://www.tensid.ch/cw/che/10/xml/5_10...
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`3/2/2004
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`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1061, p. 7 of 8
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`Actelion - Full Press Release
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