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January 22, 2010
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Cubist Pharmaceuticals (CBST) reported earnings per share (EPS) of 38 cents for the fourth quarter of 2009, missing the Zacks Consensus Estimate by 3 cents and down from $1.43 reported in the year-ago period. Last year’s results were inflated by a tax benefit of $100 million. However, excluding non-recurring expenses and income, EPS for the fourth quarter was 68 cents, a marginal decline compared to 71 cents reported in the year-ago period. For the full year, Cubist reported EPS of $2.29, an increase of 26% compared to the year-ago period.
Revenues for the quarter ($167 million) as well as the full year ($562 million) recorded a year-over-year increase of 27% and 30%, respectively. The primary reason for increased revenues was higher sales of Cubicin (daptomycin for injection) in the U.S. - $147.8 million (year-over-year growth of 23%) and $524 million (year-over-year growth of 26%) during the fourth quarter and full year, respectively. Cubist expects to record $600 million - $620 million in U.S. Cubicin sales for 2010.
Despite the 27% growth in revenues, operating income came down 11.5% on a 48% rise in expenses. Primary reason for the rise was the acquisition of Calixa Therapeutics in December 2009.
In addition to posting financial results, Cubist came out with a pipeline update. Following the Calixa deal, Cubist gained rights to Calixa’s lead compound CXA-201 (containing CXA-101) as well as any other drugs incorporating CXA-101. CXA-201, mid-stage candidate is being developed as an intravenous therapy to treat certain serious bacterial infections caused by Pseudomonas aeruginosa. Cubist plans to begin clinical studies of CXA-201 for complicated urinary tract infections (cUTI) and complicated intra-abdominal infections (cIAI) in the first half of 2010. Additionally, the drug will be studied for the nosocomial pneumonia indication in the second half of 2010. Provided results are encouraging, the company expects to file a New Drug Application (NDA) for CXA-201 in the second half of 2013.
Cubist exited the quarter with $496.2 million in cash and investments after the upfront transaction-related expenses of the Calixa acquisition. The company’s debt burden increased $13.2 million to $245.4 million.
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