By Charles Craig
Biogen Inc., riding the successful launch of its first marketed product in 1996, said it posted for the year record revenues of $270 million and net income of $40.5 million, or 55 cents per share.
In the fourth quarter, ending Dec. 31, 1996, the Cambridge, Mass., company's net income was $8.23 million, or 11 cents per share, compared with less than $1 million, or 1 cent per share, during the last three months of 1995.
Biogen said its fourth quarter earnings would have been double the amount posted, but expenses related to its new collaboration with Creative BioMolecules Inc., of Hopkinton, Mass., on a kidney tissue regeneration drug totaled more than $13 million.
Biogen credited sales of its multiple sclerosis drug Avonex (interferon beta-1a), the first product marketed directly by the company, for the record performance in 1996.
Avonex, launched in May 1996 following FDA approval, generated sales of $44.56 million for the fourth quarter and $78.2 million for the year.
Biogen CEO Jim Vincent has said the drug, in eight months, became the leading treatment for multiple sclerosis, eclipsing sales of a more established rival therapy, Betaseron (interferon beta-1b). Betaseron is made by Chiron Corp., of Emeryville, Calif., and sold by Berlex Laboratories Inc., of Wayne, N.J., the U.S. subsidiary of Berlin-based Schering AG. (See BioWorld Today, Jan. 9, 1996, p. 1.)
Avonex also will compete with Copaxone, a drug approved by the FDA in late December 1996, for multiple sclerosis. Copaxone was developed by Teva Pharmaceuticals Inc., of Jerusalem, and will be marketed in the U.S. by Teva Marion Partners, of Kansas City, Mo., a joint venture between Teva and Hoechst Marion Roussel, of Frankfurt, Germany.
In addition to Avonex sales, Biogen's other revenues were derived from royalties on drugs it developed in licensing agreements with pharmaceutical firms. The company's royalty revenues totaled $181.5 million for 1996 and $42.86 million for the fourth quarter.
In 1995, royalty revenues were Biogen's only income and they reached $151.7 million for the year and $36.1 million for the fourth quarter. Earnings for 1995 were 8 cents per share.
Research and development expenses for 1996 increased to $132.4 million from $87 million in 1995. In the fourth quarter of 1996, research and development costs more than doubled to $48.3 million from $23 million.
The heightened research activity is being watched closely by analysts waiting to see what Biogen does for an encore to Avonex. The company ended 1996 with $321 million in cash and is expected to continue buying new technologies and products to fatten its pipeline.
In 1996, Biogen moved into developmental biology in collaborations with Creative BioMolecules and Ontogeny Inc., of Cambridge, Mass. Developmental biology is the study of how a single cell becomes a person. Identification of molecules responsible for that process is considered key to regenerating damaged tissues in adults.
Biogen has committed up to $212 million for development of drugs in the Creative BioMolecules and Ontogeny partnerships.
In 1995, Biogen jumped into gene therapy in a collaboration supporting research at a start-up Philadelphia firm, Genovo Inc.
Biogen released its fourth quarter and year-end fiscal reports after the market closed Tuesday. Its stock (NASDAQ:BGEN) closed Wednesday at $41.50, up $0.50. *