Repligen Reports Third Quarter 2012 Financial Results

  Repligen Reports Third Quarter 2012 Financial Results

    - Net Income Triples on 94% Increase in Bioprocessing Product Sales -

Business Wire

WALTHAM, Mass. -- November 08, 2012

Repligen Corporation (NASDAQ: RGEN) today reported financial results for its
third quarter and year-to-date period ended September 30, 2012. The Company
reported net income for the three-month period ended September 30, 2012 of
$1,806,000 or $0.06 per diluted share, compared to $605,000 or $0.02 per
diluted share for the same period in 2011, an increase of 199%. Total revenue
for the three-month period ended September 30, 2012 was $15,104,000 compared
to $8,631,000 for the same period in 2011, an increase of 75%. Revenue growth
for the third quarter of 2012 was driven by the Company’s expanded
bioprocessing business, which generated $11,123,000 in product revenue
compared to $5,742,000 for the same period in 2011, an increase of 94%.
Royalty and research revenue for the three-month period ended September 30,
2012, consisting primarily of royalty payments from Bristol-Myers Squibb on
its U.S. sales of Orencia^®, was $3,981,000 compared to $2,889,000 for the
same period in 2011. September 30, 2012 marks the end of the third fiscal
quarter for which the Company is reporting consolidated financial results
since its acquisition of its subsidiary Repligen Sweden AB in December 2011.

“We continued to deliver strong financial performance during the third quarter
and year-to-date, driven by increased revenue from our expanded bioprocessing
business,” said Walter C. Herlihy, Ph.D., President and CEO of Repligen. “In
August, we announced our decision to focus corporate strategy and resources on
the growth of our profitable bioprocessing business. Our efforts are now
directed toward achieving operational and financial excellence as a life
sciences company providing high-value consumables to the global
biomanufacturing market.”

Operating expenses for the three-month period ended September 30, 2012 were
$12,917,000 compared to $8,079,000 for the same period in 2011, an increase of
$4,838,000 or 60%. These operating expenses included an increase in cost of
product revenue of $4,326,000 due to higher product sales, and an increase in
selling, general and administrative expenses of $633,000 compared to the same
three-month period in 2011. These increases were primarily due to the
expansion of our business with the addition of Repligen Sweden AB. Research
and development expenses decreased by $642,000 during the three-month period
ended September 30, 2012 compared to the same period in 2011. This decrease
was primarily due to lower spending on our clinical development programs as a
result of our decision to focus on the growth of our core bioprocessing
business. Cash and investments as of September 30, 2012 were $42,725,000
compared to $36,025,000 as of December 31, 2011.

For the nine-month period ended September 30, 2012, total revenue was
$43,453,000 compared to total revenue of $22,191,000 for the same period in
2011, an increase of 96%. During the nine-month period ended September 30,
2012, product revenue increased by 142% and royalty and other revenue
increased by 27%, compared to the same period in 2011.

Operating expenses for the nine-month period ended September 30, 2012 were
$38,780,000 compared to $23,847,000 for the same period in 2011. Operating
expenses for the nine-month period ended September 30, 2012 included an
increase in cost of product revenue of $13,998,000 due to higher product
sales, and an increase in selling, general and administrative expenses of
$2,752,000 compared to the same period in 2011. These increases were primarily
due to the expansion of our business with the addition of Repligen Sweden AB.
Research and development expenses decreased by $2,229,000 during the
nine-month period ended September 30, 2012 compared to the same period in
2011. Net income for the nine-month period ended September 30, 2012 was
$4,603,000 or $0.15 per diluted share compared to a net loss of $1,482,000 or
$0.05 per diluted share for the same period in 2011.

Based on current projections, the Company is reiterating its revenue and net
income guidance for fiscal year 2012. The Company is estimating total revenue
in the range of $55 million to $57 million, including bioprocessing product
revenue in the range of $41 million to $43 million, for fiscal year 2012. The
Company is also confirming its expectations for net profit in the range of $5
million to $7 million for fiscal year 2012.

Corporate Update

  *On August 2, we announced our corporate decision to focus the Company’s
    efforts on our profitable bioprocessing business, considering its
    performance and opportunities for growth, and given the additional costs
    and resources necessary to achieve potential regulatory approval of our
    Phase 3 clinical product candidate RG1068. We are currently seeking
    development and commercialization partners for this pancreatic imaging
    agent, as well as our earlier stage central nervous system rare disease
    product candidates.
  *On September 21, we announced the appointment of Jonathan I. Lieber to the
    position of Chief Financial Officer and Treasurer of Repligen, to lead
    Repligen’s financial activities, including its long-term financial
    strategy and risk management, as the Company has become a larger and more
    complex organization since the acquisition of Repligen Sweden AB. Mr.
    Lieber most recently held the position of CFO and Treasurer at Xcellerex,
    Inc., a supplier of bioprocessing products and disposable manufacturing
    technologies that was acquired by GE Healthcare in May 2012. In
    conjunction with this appointment, William J. Kelly was named Chief
    Accounting Officer of the Company.

Repligen’s Bioprocessing Business

Our acquisition of Novozymes Biopharma Sweden AB (now Repligen Sweden AB) in
December 2011 positioned Repligen as a world-leading manufacturer of
high-value consumable bioprocessing products. We currently manufacture and
sell Protein A, growth factors and chromatography products, all of which are
used in the production of biologic drugs (monoclonal antibodies, vaccines and
other protein therapeutics). Demand for these bioprocessing products is driven
by the continued expansion of the global market for biologics, particularly
monoclonal antibodies.

Repligen is a leading large-scale manufacturer of Protein A, a critical
reagent used in the production of monoclonal antibody therapeutics. We
manufacture and sell multiple forms of bulk Protein A under long term supply
agreements with large life sciences companies. These customers incorporate
Protein A into their chromatography media products that they in turn sell to
biopharmaceutical companies for the production of monoclonal antibodies. Use
of Protein A chromatography media is recognized as the established standard
for highly efficient purification of monoclonal antibodies. Demand for Protein
A is driven by the continued growth of the monoclonal antibody therapeutics
market. Over 30 monoclonal antibodies are currently approved for
commercialization, and an industry pipeline of over 300 monoclonal antibodies
in clinical development is expected to generate additional approvals and
global market expansion.

Our growth factor products are used to increase productivity during the
fermentation (cell culture) stage of manufacturing biologic drugs. The use of
growth factors results in improved yield of the final drug product. We
obtained our growth factors through the acquisition of Repligen Sweden AB, and
we expect this product line to benefit from increased market demand for cell
culture supplements. Our primary growth factor product is LONG^®R3IGF-1, a
more biologically potent alternative to recombinant insulin. Repligen’s growth
factor products are currently used in the manufacture of nine biologic drugs
approved by the U.S. Food and Drug Administration (FDA).

Our proprietary chromatography products are sold directly to biopharmaceutical
manufacturers. These products are utilized during the purification and quality
control stages of biomanufacturing and include Repligen’s Protein A affinity
chromatography media, our pre-packed OPUS^® chromatography columns and our
Protein A ELISA test kits. In the area of purification, we currently offer
three types of Protein A media that are used in the manufacture of several
approved monoclonal antibodies. We also sell our OPUS^® pre-packed
chromatography columns as a disposable technology alternative for
manufacturers of clinical-stage or niche commercial biologics. In the area of
quality control, our ELISA test kits are used to ensure the purity of
monoclonal antibody products by detecting any leached Protein A during process
monitoring and final product testing.

In total, we have a portfolio of over 15 bioprocessing products, many of which
have been incorporated into established biopharmaceutical manufacturing
processes. Consistent with our focus on the growth of our bioprocessing
business, we are currently exploring opportunities to acquire synergistic
bioprocessing companies and/or consumable bioprocessing products.

Conference Call

Repligen will host a conference call and webcast today, November 8, 2012, at
9:00 a.m. EST, to discuss its third quarter and year-to-date 2012 financial
results and corporate developments. The live call can be accessed by dialing
(800) 260-8140 for domestic callers or (617) 614-3672 for international
callers. Dial-in participants must provide the passcode 85324503.
Alternatively, an audio webcast will be accessible via the Investors section
of Repligen’s website www.repligen.com. Both the conference call and webcast
will be archived for a period of time following the live event. The replay
dial-in numbers are (888) 286-8010 for domestic callers and (617) 801-6888 for
international callers. Replay listeners must provide the passcode 97138968.

About Repligen Corporation

Repligen Corporation is a life sciences company focused on the development,
production and commercialization of high-value consumable products used in the
process of manufacturing biological drugs. Our bioprocessing products are sold
to major life sciences and biopharmaceutical companies worldwide. We are a
leading manufacturer of Protein A, a critical reagent used during the
production of monoclonal antibody therapeutics. We also supply several growth
factor products used to increase cell culture productivity during
fermentation. In the burgeoning area of disposable biomanufacturing
technologies, we have developed and market a series of OPUS^® pre-packed
chromatography columns for use in clinical-stage and/or niche biologics
manufacturing. In addition to our core bioprocessing business, we have a
portfolio of clinical-stage partnering assets, including our pancreatic
imaging agent in Phase 3 development and two central nervous system orphan
drug candidates. Repligen’s corporate headquarters are located in Waltham, MA,
USA; we have an additional manufacturing facility in Lund, Sweden. For more
information, please visit our website at www.repligen.com.

This press release contains forward-looking statements, which are made
pursuant to the safe harbor provisions of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Investors are cautioned that statements in this press release which
are not strictly historical statements, constitute forward-looking statements,
including, without limitation, express or implied statements regarding future
financial performance and position, our strategic decision to focus on the
growth of our bioprocessing business, the future demand for our bioprocessing
products, plans and objectives for future operations, our ability to
successfully negotiate and consummate partnering transactions for our clinical
stage assets, specifically RG1068, RG3039 and RG2833, plans and objectives for
product development and acquisitions, our market share and product sales and
other statements identified by words like “believe,” “expect,” “may,” “will,”
“should,” “seek,” or “could” and similar expressions. Such forward-looking
statements are subject to a number of risks and uncertainties that could cause
actual results to differ materially from those anticipated, including, without
limitation, risks associated with: our ability to successfully grow our
bioprocessing business; including as a result of acquisition,
commercialization or partnership opportunities; our ability to successfully
negotiate and consummate development and commercialization partnerships for
our portfolio of clinical-stage assets on acceptable terms, if at all; our
ability to develop and commercialize products and the market acceptance of our
products; reduced demand for our products that adversely impacts our future
revenues, cash flows, results of operations and financial condition; the
success of current and future collaborative or supply relationships; our
ability to compete with larger, better financed bioprocessing, pharmaceutical
and biotechnology companies; our ability to successfully integrate Repligen
Sweden AB; new approaches to the treatment of our targeted diseases; our
ability to obtain, maintain and protect intellectual property rights for our
products; the risk of litigation regarding our intellectual property rights;
our limited sales capabilities; our volatile stock price; and other risks
detailed in Repligen’s Annual Report on Form 10-K on file with the Securities
and Exchange Commission and the other reports that Repligen periodically files
with the Securities and Exchange Commission. Actual results may differ
materially from those Repligen contemplated by these forward-looking
statements. These forward looking statements reflect management’s current
views and Repligen does not undertake to update any of these forward-looking
statements to reflect a change in its views or events or circumstances that
occur after the date hereof except as required by law.

REPLIGEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)
                                                                   
                 Three months ended September 30,      Nine months ended September 30,
                 2012               2011               2012             2011
Revenue:
Product          $ 11,123,236       $ 5,741,920        $ 32,125,076     $ 13,250,840
revenue
Royalty and       3,981,059        2,889,458        11,327,500     8,940,648  
other revenue
Total revenue      15,104,295         8,631,378          43,452,576       22,191,488
Operating
expenses:
Cost of
product            6,418,962          2,092,815          19,036,762       5,038,713
revenue
Cost of
royalty and        594,406            418,419            1,593,427        1,211,180
other revenue
Research and       2,433,043          3,074,625          8,147,164        10,376,357
development
Selling,
general and        3,126,244          2,493,093          9,973,013        7,220,847
administrative
Contingent
consideration      343,932            -                  343,932          -
- fair value
adjustments
Gain on
bargain           -                -                (314,244   )    -          
purchase
Total
operating         12,916,587       8,078,952        38,780,054     23,847,097 
expenses
Income (loss)
from               2,187,708          552,426            4,672,522        (1,655,609 )
operations
Investment         95,807             52,247             156,747          187,482
income
Interest           7,205              -                  (42,536    )     (13,484    )
expense
Other
(expense)         (500,414     )    -                67,145         -          
income
Income (loss)
before income      1,790,306          604,673            4,853,878        (1,481,611 )
taxes
Income tax
(benefit)         (16,183      )    -                250,954        -          
provision
Net income       $ 1,806,489       $ 604,673         $ 4,602,924     $ (1,481,611 )
(loss)
Earnings
(loss) per
share:
Basic            $ 0.06            $ 0.02            $ 0.15          $ (0.05      )
Diluted          $ 0.06            $ 0.02            $ 0.15          $ (0.05      )
Weighted
average shares
outstanding:
Basic             30,948,062       30,796,797       30,841,344     30,800,510 
Diluted           31,256,273       30,933,832       31,131,749     30,800,510 
Comprehensive    $ 3,913,569       $ 607,360         $ 6,068,700     $ (1,478,924 )
income (loss)
                                                                        
                                                                        
Balance Sheet    Sept. 30, 2012     Dec. 31, 2011
Data:
Cash, cash
equivalents      $ 42,725,048       $ 36,024,531
and marketable
securities*
Working            44,756,925         39,431,285
capital
Total assets       84,896,632         76,056,814
Long-term          2,156,867          2,606,293
obligations
Accumulated        (114,686,061 )     (119,306,614 )
deficit
Stockholders'      73,703,980         65,987,000
equity
                                                                        
*does not include restricted cash

Contact:

Repligen Corporation
Sondra S. Newman, 781-419-1881
Director Investor Relations