SUMMIT, N.J.--(BUSINESS WIRE)--Celgene Corporation (NASDAQ:CELG) reported net product sales of $3,890 million for the third quarter of 2018, an 18 percent increase from the same period in 2017. Celgene reported third quarter 2018 total revenue of $3,892 million, an 18 percent increase compared to $3,287 million in the third quarter of 2017.

Based on U.S. GAAP (Generally Accepted Accounting Principles), Celgene reported net income of $1,082 million and diluted earnings per share (EPS) of $1.50 for the third quarter of 2018. For the third quarter of 2017, GAAP net income was $988 million and diluted EPS was $1.21.

Adjusted net income for the third quarter of 2018 increased 6 percent to $1,645 million compared to $1,555 million in the third quarter of 2017. For the same period, adjusted diluted EPS increased 20 percent to $2.29 from $1.91.

“Excellent top- and bottom-line momentum in the third quarter supports raising our 2018 financial guidance,” said Mark J. Alles, Chairman and Chief Executive Officer of Celgene Corporation. “We are focused on shaping Celgene’s future by rapidly advancing our late-stage pipeline, accelerating promising early research programs, and strengthening the organization.”

Third Quarter 2018 Financial Highlights

Unless otherwise stated, all comparisons are for the third quarter of 2018 compared to the third quarter of 2017. The adjusted operating expense categories presented below exclude share-based employee compensation expense and collaboration-related upfront expense. Please see the attached Use of Non-GAAP Financial Measures and Reconciliation of GAAP to Adjusted Net Income for further information relevant to the interpretation of adjusted financial measures and reconciliations of these adjusted financial measures to the most comparable GAAP measures, respectively.

Net Product Sales Performance

• REVLIMID® sales for the third quarter increased 18 percent to $2,449 million. REVLIMID® sales growth was driven by increases in market share and extended treatment duration. U.S. sales of $1,667 million and international sales of $782 million increased 22 percent and 9 percent year-over-year, respectively.
• POMALYST®/IMNOVID® sales for the third quarter were $513 million, an increase of 23 percent year-over-year. POMALYST®/IMNOVID® sales growth was driven primarily by increases in market share and treatment duration. U.S. sales were $357 million and international sales were $156 million, an increase of 33 percent and 5 percent year-over-year, respectively.
• OTEZLA® sales for the third quarter were $432 million, a 40 percent increase year-over-year. Third quarter U.S. sales of $348 million and international sales of $84 million increased 39 percent and 45 percent year-over-year, respectively. OTEZLA® sales growth in the U.S. was driven by increases in demand with continued benefit from expanded market access and higher channel inventory levels. OTEZLA® international sales have maintained solid momentum in key ex-U.S. markets including France and Japan.
• ABRAXANE® sales for the third quarter were $288 million, a 15 percent increase year-over-year. ABRAXANE® sales growth was driven by increases in demand and customer buying patterns. U.S. sales were $174 million and international sales were $114 million, an increase of 17 percent and 12 percent year-over-year, respectively.
• In the third quarter, all other product sales, which include IDHIFA®, THALOMID®, ISTODAX®, VIDAZA® and an authorized generic version of VIDAZA® drug product primarily sold in the U.S., were $208 million compared to $226 million in the third quarter of 2017.

Research and Development (R&D)

On a GAAP basis, R&D expenses were $1,081 million for the third quarter of 2018 compared to $1,347 million for the same period in 2017. Adjusted R&D expenses were $948 million for the third quarter of 2018 compared to $698 million for the third quarter of 2017. The current period included an increase in R&D expense associated with the acquisition of Juno Therapeutics (Juno) and regulatory submission-related work on multiple programs. Additional R&D expenses (only included on a GAAP basis) decreased in 2018, as outlined in the attached Reconciliation of GAAP to Adjusted Net Income.

Selling, General and Administrative (SG&A)

On a GAAP basis, SG&A expenses were $746 million for the third quarter of 2018 compared to $608 million for the same period in 2017. Adjusted SG&A expenses were $642 million for the third quarter of 2018 compared to $521 million for the third quarter of 2017. The current period included an increase in SG&A expense associated with the acquisition of Juno and marketing-related expenses. Additional SG&A expense (only included on a GAAP basis) increased in 2018, as outlined in the attached Reconciliation of GAAP to Adjusted Net Income.

Cash, Cash Equivalents, Marketable Debt Securities and Publicly-Traded Equity Securities

Operating cash flow was $1.9 billion in the third quarter of 2018, compared to $1.1 billion for the third quarter of 2017. In the third quarter, Celgene received approximately 6 million of its shares upon final settlement of the accelerated share repurchase (ASR) program, which commenced during the second quarter of 2018. The total number of shares repurchased under the ASR agreement was approximately 24.0 million at a weighted average price of $83.53 per share. Celgene ended the quarter with approximately $4.4 billion in cash, cash equivalents, marketable debt securities and publicly-traded equity securities.

Portfolio Updates

• At the 2018 American Society of Hematology (ASH) annual meeting in December, expected data presentations include:
  • In collaboration with partner Acceleron Pharma, data from the phase III MEDALIST™ and BELIEVE™ trials with luspatercept in patients with low-to-intermediate risk myelodysplastic syndromes (MDS) and transfusion-dependent beta-thalassemia, respectively;
  • Data from the phase I TRANSCEND CLL-004 trial evaluating liso-cel (JCAR017) in patients with relapsed and/or refractory chronic lymphocytic leukemia (CLL);
  • In collaboration with partner bluebird bio, data from the phase I trial evaluating bb21217 in patients with relapsed and/or refractory multiple myeloma (RRMM);
  • Data from the phase I/II EVOLVE trial evaluating JCARH125 in patients with RRMM; and,
  • Data from the phase III AUGMENT™ trial evaluating REVLIMID® in combination with rituximab (R²) in patients with relapsed and/or refractory indolent non-Hodgkin lymphoma (NHL).
• The phase III COMMANDS™ front-line trial evaluating luspatercept in erythropoiesis-stimulating agent (ESA)-naïve, very low, low or intermediate risk MDS patients initiated in the third quarter.
• In collaboration with partner bluebird bio, the clinical program evaluating bb2121 in earlier lines of multiple myeloma is advancing, including the phase II MM-002 and phase III MM-003 trials.
• In October, Celgene announced results from a phase II/III cooperative group study (ECOG E3A06) conducted by the National Cancer Institute in conjunction with the ECOG-ACRIN Cancer Research Group. In the study, single-agent REVLIMID® achieved a statistically significant improvement in the primary endpoint of progression-free survival compared to observation in patients with smoldering myeloma. Data from the ECOG E3A06 study will be presented at a future medical meeting.
• At the European Society for Medical Oncology (ESMO) 2018 congress in October, efficacy and safety data were presented for the first time from the Genentech-sponsored phase III IMpassion130 trial evaluating TECENTRIQ®(atezolizumab) in combination with ABRAXANE® in patients with previously untreated metastatic triple-negative breast cancer. These data were simultaneously published in The New England Journal of Medicine. In addition, data were presented from the Genentech-sponsored phase III IMpower130 trial evaluating first-line treatment of TECENTRIQ® plus chemotherapy (carboplatin and ABRAXANE®) in patients with stage IV non-squamous non-small cell lung cancer (NSCLC).
• In October, Celgene announced that the phase III STYLE™ trial evaluating OTEZLA® in patients with moderate to severe plaque psoriasis of the scalp achieved a highly statistically significant improvement in the primary endpoint of the Scalp Physician’s Global Assessment (ScPGA) response at week 16 compared with placebo. In addition to achieving the primary endpoint, statistical significance was also met for the secondary endpoint of the whole-body itch numeric rating scale (NRS) at week 16 with OTEZLA® versus placebo. The safety profile for OTEZLA® in the STYLE™ study was generally consistent with the known safety profile of OTEZLA®, and no new safety signals were identified. Additionally, the phase III ADVANCE™ trial evaluating OTEZLA® in patients with mild to moderate plaque psoriasis is on track to initiate by year-end 2018.
• In October, data from the phase II HEROES™ trial evaluating RPC4046 in patients with eosinophilic esophagitis (EoE) were presented at the United European Gastroenterology Week (UEGW) conference. Data from the HEROES™ trial demonstrated that reductions in average esophageal eosinophil count observed at week 16 in patients treated with RPC4046 (primary endpoint) were sustained through an additional 52 weeks of treatment in an open-label extension study.

Organizational Updates

• Celgene appointed Dr. Alise Reicin as President, Global Clinical Development, effective November 1, 2018.
• Celgene appointed Aijaz “Jazz” Tobaccowalla as Senior Vice President, Chief Digital & Information Officer, effective August 27, 2018.

About Celgene

Celgene Corporation, headquartered in Summit, New Jersey, is an integrated global biopharmaceutical company engaged primarily in the discovery, development and commercialization of innovative therapies for the treatment of cancer and inflammatory diseases through next-generation solutions in protein homeostasis, immuno-oncology, epigenetics, immunology and neuro-inflammation. For more information, please visit www.celgene.com. Follow Celgene on Social Media: @Celgene,Pinterest, LinkedIn, Facebook and YouTube.

About REVLIMID®

In the U.S., REVLIMID® (lenalidomide) in combination with dexamethasone is indicated for the treatment of patients with multiple myeloma. REVLIMID® as a single agent is also indicated as a maintenance therapy in patients with multiple myeloma following autologous hematopoietic stem cell transplant. REVLIMID® is indicated for patients with transfusion-dependent anemia due to low- or intermediate-1-risk myelodysplastic syndromes (MDS) associated with a deletion 5q cytogenetic abnormality with or without additional cytogenetic abnormalities. REVLIMID® is approved in the U.S. for the treatment of patients with mantle cell lymphoma (MCL) whose disease has relapsed or progressed after two prior therapies, one of which included bortezomib. Limitations of Use: REVLIMID® is not indicated and is not recommended for the treatment of chronic lymphocytic leukemia (CLL) outside of controlled clinical trials.

About ABRAXANE®

In the U.S., ABRAXANE® for Injectable Suspension (paclitaxel protein-bound particles for injectable suspension) (albumin-bound) is indicated for the treatment of metastatic breast cancer after failure of combination chemotherapy for metastatic disease or relapse within six months of adjuvant chemotherapy. Prior therapy should have included an anthracycline unless clinically contraindicated. ABRAXANE® is indicated for the first-line treatment of locally advanced or metastatic non-small cell lung cancer, in combination with carboplatin, in patients who are not candidates for curative surgery or radiation therapy. ABRAXANE® is also indicated for the first-line treatment of metastatic adenocarcinoma of the pancreas in combination with gemcitabine.

About POMALYST®

In the U.S., POMALYST® (pomalidomide) is indicated for patients with multiple myeloma who have received at least two prior therapies including lenalidomide and a proteasome inhibitor and have demonstrated disease progression on or within 60 days of completion of the last therapy.

About OTEZLA®

In the U.S., OTEZLA® (apremilast) is indicated for the treatment of adult patients with active psoriatic arthritis. OTEZLA® is indicated in the U.S. for the treatment of patients with moderate to severe plaque psoriasis who are candidates for phototherapy or systemic therapy.