Alkermes Raises FY23 Guidance With Final Award In Johnson & Johnson Unit Arbitration

(RTTNews) - Biopharmaceutical company Alkermes plc (ALKS) on Tuesday raised its fiscal 2023 earnings and revenue forecast after it received a final award from the arbitral tribunal in its arbitration proceedings with Janssen Pharmaceutica N.V., a unit of Johnson & Johnson (JNJ).

Following the final resolution with regard to two license agreements, Alkermes' annual outlook now reflects $425 million, which includes back royalties of approximately $194 million related to 2022 U.S. net sales of the long-acting INVEGA products and CABENUVA. It also reflects anticipated royalty revenues related to 2023 global net sales of these products. The company anticipates further royalties for the year 2024 and beyond.

Janssen may terminate the license agreements but it may not continue to sell products developed during the license period without paying royalties.

Apart from these, a separate Know-How Royalty term applies for INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA. The term for INVEGA SUSTENNA ends in 2024, and for INVEGA TRINZA and INVEGA HAFYERA in 2030, while royalties for CABENUVA in the U.S. are due till 2036.

Looking ahead to the full year of 2023, Alkermes now expects earnings to be in the range of $225 million- $265 million, compared to previously expected loss of $160 million- $200 million.

Earnings per share is now expected to be $1.31 - $1.54. The previous outlook was a loss of $0.96- $1.20 per share.

Adjusted earnings are expected to be in the range of $230 million - $270 million. The previous guidance was $0 - $40 million. Adjusted earnings per share is expected to be $1.34 - $1.57. Previously, the earnings guidance was $0.00 - $0.23 per share.

On average, seven analysts polled by Thomson Reuters expect earnings of $0.08 per share for the year. Analysts' estimates typically exclude special items.

The guidance for total revenues has increased to $1.55 billion - $1.68 billion from $1.13 billion - $1.25 billion expected earlier. The Street estimate is $1.19 billion.

Further, the company said it expects royalties related to the Janssen license agreements to be incrementally accretive to its profitability targets, and reiterated its targets for fiscal 2024 and fiscal 2025.

In premarket activity, shares of Alkermes are trading at $29.51 up 0.17% or $ 0.05 on the Nasdaq.