Thursday, Jan 17, 1991
South San Francisco, Calif. -- January 17, 1991 --Genentech, Inc. (NYSE: GNE) today reported a fourth quarter profit of $17.1 million, or 15 cents per share, up 10 percent from $15.5 million, or 18 cents per share, for the same period a year ago. As a result of the increased number of shares outstanding, mainly due to Genentech's transaction with Roche Holdings Ltd., the fourth quarter earnings per share are less than last year, even though profits increased.
Revenues increased 18 percent to $131.3 million from $111.4 million for the preceding fourth quarter.
Due to a previously reported special charge of $167.7 million ($1.74 per share), which is primarily merger-related, Genentech incurred a loss of $98.0 million, or $1.05 per share, for all of 1990 compared with a profit of $44.0 million, or 51 cents per share for 1989.
"With the addition of three new products in clinical trials, Genentech now has one of the most promising product pipelines in the pharmaceutical industry," said G. Kirk Raab, president and chief executive officer. "The Roche transaction gives us substantial resources to bring these potential products to market as quickly as possible, as well as the means to supplement them with acquisitions or in-licensing."
Revenues for 1990 rose 19 percent from $400.5 million a year ago to a record of $476.1 million. Sales of the company's heart attack drug, Activase® (t-PA), were up 7 percent to $210 million, from $196.4 million. Despite competitive challenges during the year, Activase maintained an approximately two-thirds market share during 1990.
Sales of human growth hormone, sold under the brand name Protropin®, grew 28 percent to $157.1 million, up from $122.7 million. Genentech attributes the sales gain to the larger average size of patients being treated, at a correspondingly larger dose, and an increased number of diagnosed growth hormone deficient patients.
Cash at the end of 1990 totaled $691.3 million, compared with $205.0 million at the end of 1989. Genentech's cash balance increased largely due to its transaction with Roche, under which Roche purchased a 60 percent equity interest in Genentech.
Genentech's research and development expenses for 1990 were expanded to $173.1 million, from $156.9 million. Genentech currently has a total of nine products in human clinical trials for more than 15 indications.
During 1990, clinical trials were initiated for relaxin, to facilitate childbirth; DNase, as a potential treatment for cystic fibrosis and chronic bronchitis; and gp120, a potential treatment for infection with the human immunodeficiency virus.
Last month, Genentech's third product, Actimmune®, gamma interferon, was approved by the Food and Drug Administration for the management of chronic granulomatous disease. In June, the FDA approved Activase for the treatment of acute massive pulmonary embolism, or obstruction of the arteries in the lungs.
Also during 1990, the company began construction, at its South San Francisco headquarters, of the $75 million Genentech Research Center, which will be one of the largest commercial or academic biotechnology research centers. Completion is scheduled for mid-1992.
Primarily as a result of the Roche transaction, which was consummated on September 7, Genentech's weighted average number of shares increased from 87 million for the fourth quarter of 1989 to 112 million for the fourth quarter of 1990.
Genentech, Inc. is a leading biotechnology company focusing on the development, manufacture and marketing of pharmaceuticals produced by recombinant DNA technology.
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CONDENSED CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share amounts)