Alkermes plc Reports Financial Results for Quarter Ended June 30, 2013

  Alkermes plc Reports Financial Results for Quarter Ended June 30, 2013

     — Revenues From the Company’s Five Key Commercial Products Grew 22%
                      Year-Over-Year to $98.9 Million —

              — Company Reports Non-GAAP Diluted EPS of $0.30 —

Business Wire

DUBLIN -- July 25, 2013

Alkermes plc (NASDAQ: ALKS) today reported financial results for the quarter
ended June 30, 2013. This is the first quarter of the nine-month period ending
Dec. 31, 2013, as the company transitions to reporting on a calendar year
basis.

“This was another strong quarter for Alkermes. The business continues to
generate strong financial results driven primarily by our portfolio of five
key commercial products. The company is generating significant cash flow, and
at the same time, we are advancing our robust clinical pipeline, which will be
a major driver of Alkermes’ future growth,” commented James Frates, Chief
Financial Officer of Alkermes. “Looking forward, our business remains on track
to achieve our growth and financial expectations for the remainder of the
calendar year.”

“Alkermes’ strong financial foundation from our commercial product portfolio,
coupled with our expanding pipeline of development candidates, creates
opportunities for exceptional value and growth,” commented Richard Pops, Chief
Executive Officer of Alkermes. “Our pipeline now encompasses a range of
promising, innovative and differentiated drug candidates, including three
recently unveiled preclinical candidates that reflect our expanded research
and development capabilities and productivity. Our pipeline is designed to
address compelling patient needs and has become one of the most diverse and
exciting CNS pipelines in the biopharmaceutical industry.”

Quarter Ended June 30, 2013 Highlights

  *Total revenues for the quarter were $138.6 million. This compared to total
    revenues of $152.2 million for the same period in the prior year, which
    included $20.0 million of intellectual property license revenue unrelated
    to key development programs.
  *Revenues from the company’s five key commercial products for the quarter
    grew 22% to $98.9 million, from $81.2 million for the same period in the
    prior year.
  *Non-GAAP net income for the quarter was $42.9 million, or a non-GAAP
    diluted earnings per share (EPS) of $0.30. This compared to non-GAAP net
    income of $53.0 million, or a non-GAAP diluted EPS of $0.39, for the same
    period in the prior year, which included $20.0 million, or $0.15 per
    diluted share, of intellectual property license revenue.
  *GAAP net income for the quarter was $7.3 million, or a basic and diluted
    GAAP EPS of $0.05. This compared to GAAP net income of $22.4 million, or a
    basic and diluted GAAP EPS of $0.17, for the same period in the prior
    year, which included $20.0 million, or $0.15 per diluted share, of
    intellectual property license revenue.
  *Free cash flow for the quarter was $39.2 million. This compared to $46.2
    million for the same period in the prior year, which included $20.0
    million of intellectual property license revenue.
  *The company reiterated its financial expectations for the nine-month
    period ending Dec. 31, 2013, which were originally provided on May 23,
    2013.

Quarter Ended June 30, 2013 Financial Results

Revenues

  *Manufacturing and royalty revenues from the company’s long-acting atypical
    antipsychotic franchise, RISPERDAL^® CONSTA^® and INVEGA^®
    SUSTENNA^®/XEPLION^®, were $56.2 million, compared to $48.6 million for
    the same period in the prior year. Worldwide end-market sales of RISPERDAL
    CONSTA and INVEGA SUSTENNA/XEPLION ^ were approximately $627 million,
    compared to approximately $550 million in the same period in the prior
    year.
  *Manufacturing and royalty revenues from AMPYRA^®/FAMPYRA^®1 were $19.9
    million, compared to $17.2 million for the same period in the prior year.
  *Net sales of VIVITROL^® were $17.4 million, compared to $12.4 million for
    the same period in the prior year, representing an increase of
    approximately 40% year over year.
  *Royalty revenue from BYDUREON^® was $5.4 million, compared to $3.0 million
    for the same period in the prior year.
  *Additionally, results for the quarter included RITALIN LA^®/FOCALIN XR^®
    revenues of $11.2 million, VERELAN^® revenues of $6.5 million and TRICOR^®
    145 revenues of $4.1 million. This compared to RITALIN LA/FOCALIN XR
    revenues of $10.9 million, VERELAN revenues of $6.0 million and TRICOR 145
    revenues of $12.0 million for the same period in the prior year.

Costs and Expenses

  *Operating expenses were $125.1 million. This compared to operating
    expenses of $120.1 million for the same period in the prior year.
  *Net interest expense was $3.3 million. This compared to net interest
    expense of $9.9 million for the same period in the prior year. The
    reduction was driven by the successful refinancing and repricing of the
    company’s term loans completed in 2012 and 2013, respectively.

Balance Sheet

  *At June 30, 2013, Alkermes recorded cash and total investments of $325.0
    million, compared to $304.2 million at March 31, 2013.

Conference Call

Alkermes will host a conference call at 8:30 a.m. EDT (1:30 p.m. BST) on
Thursday, July 25, 2013, to discuss these financial results and provide an
update on the company. The conference call may be accessed by dialing +1 888
424 8151 for U.S. callers and +1 847 585 4422 for international callers. The
conference call ID number is 6037988. In addition, a replay of the conference
call will be available from 10:30 a.m. EDT (3:30 p.m. BST) on Thursday, July
25, 2013, through 5:00 p.m. EDT (10:00 p.m. BST) on August 1, 2013, and may be
accessed by visiting Alkermes’ website or by dialing +1 888 843 7419 for U.S.
callers and +1 630 652 3042 for international callers. The replay access code
is 6037988.

About Alkermes plc

Alkermes plc is a fully integrated, global biopharmaceutical company that
applies its scientific expertise and proprietary technologies to develop
innovative medicines that improve patient outcomes. The company has a
diversified portfolio of more than 20 commercial drug products and a
substantial clinical pipeline of product candidates that address central
nervous system (CNS) disorders such as addiction, schizophrenia and
depression. Headquartered in Dublin, Ireland, Alkermes plc has an R&D center
in Waltham, Massachusetts; a research and manufacturing facility in Athlone,
Ireland; and manufacturing facilities in Gainesville, Georgia and Wilmington,
Ohio. For more information, please visit Alkermes’ website at
www.alkermes.com.

Non-GAAP Financial Measures

This press release includes information about certain financial measures that
are not prepared in accordance with generally accepted accounting principles
in the U.S. (GAAP), including non-GAAP net income, non-GAAP diluted earnings
per share and free cash flow. These non-GAAP measures are not based on any
standardized methodology prescribed by GAAP and are not necessarily comparable
to similar measures presented by other companies.

Management defines its non-GAAP financial measures as follows:

  *Non-GAAP net income adjusts for one-time and non-cash charges by excluding
    from GAAP results: share-based compensation expense; amortization;
    depreciation; non-cash net interest expense; non-cash tax expense;
    deferred revenue; and certain other one-time or non-cash items.
  *Free cash flow represents non-GAAP net income less capital expenditures.

Management believes that these non-GAAP financial measures, when viewed with
our results under GAAP and the accompanying reconciliations, better indicate
underlying trends in ongoing operations and cash flows. However, non-GAAP net
income, non-GAAP diluted earnings per share and free cash flow are not
measures of financial performance under GAAP and, accordingly, should not be
considered as alternatives to GAAP measures as indicators of operating
performance.

A reconciliation of GAAP to non-GAAP financial measures has been provided in
the tables included in this press release.

Note Regarding Forward-Looking Statements

Certain statements set forth above may constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995,
including, but not limited to: statements concerning future financial and
operating performance, business plans or prospects; the likelihood of
continued revenue growth from the company’s commercial products; the
therapeutic and commercial value of the company’s products; and our
expectations concerning the timing and results of our clinical development
activities. These statements are neither promises nor guarantees and are
subject to a variety of risks and uncertainties, many of which are beyond the
company’s control, which could cause actual results to differ materially from
those contemplated in these forward-looking statements.

These risks and uncertainties include, among others: clinical development
activities may not be completed on time or at all and the results of such
activities may not be predictive of real-world results or of results in
subsequent clinical trials; the company, and its partners, may not be able to
continue to successfully commercialize its products; there may occur a
reduction in payment rate or reimbursement for the company’s products or an
increase in the company’s financial obligations to governmental payers;
adverse decisions by the U.S. Food and Drug Administration (FDA) or regulatory
authorities outside the U.S. regarding the company’s products; the company’s
products may prove difficult to manufacture, be precluded from
commercialization by the proprietary rights of third parties, or have
unintended side effects, adverse reactions or incidents of misuse; and those
risks described in the company’s most recent Annual Report on Form 10-K and
10-K/A, and in other filings made by the company with the Securities and
Exchange Commission (“SEC”) and which are available at the SEC’s website at
www.sec.gov. Existing and prospective investors are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date they are made. The information contained in this press release is
provided by the company as of the date hereof and, except as required by law,
the company disclaims any intention or responsibility for updating any
forward-looking information contained in this press release.

VIVITROL^® is a registered trademark of Alkermes, Inc.; RISPERDAL^® CONSTA^®
and INVEGA^® SUSTENNA^® are registered trademarks of Janssen Pharmaceuticals,
Inc.; XEPLION^® is a registered trademark of Johnson & Johnson Corporation;
AMPYRA^® and FAMPYRA^® are registered trademarks of Acorda Therapeutics, Inc.;
BYDUREON^® is a registered trademark of Amylin Pharmaceuticals, LLC; TRICOR^®
is a registered trademark of Fournier Industrie et Sante Corporation; RITALIN
LA^® and FOCALIN XR^® are registered trademarks of Novartis AG Corporation;
and VERELAN^® is a registered trademark of Alkermes Pharma Ireland Limited.

^1AMPYRA^® (dalfampridine) Extended Release Tablets, 10 mg is developed and
marketed in the U.S. by Acorda Therapeutics, Inc. and outside the U.S. by
Biogen Idec Inc., under a licensing agreement with Acorda Therapeutics, as
FAMPYRA^® (prolonged-release fampridine tablets).


Alkermes plc and Subsidiaries
Selected Financial Information (Unaudited)
                                                               
                                                                  
                                                   Three Months   Three Months
                                                   Ended          Ended
Condensed Consolidated Statements of Operations    June 30,       June 30,
- GAAP
(In thousands, except per share data)             2013          2012
Revenues:
Manufacturing and royalty revenues                 $ 119,788      $ 138,380
Product sales, net                                 17,379         12,372
Research and development revenue                  1,464        1,487      
Total Revenues                                    138,631      152,239    
Expenses:
Cost of goods manufactured and sold                45,991         42,070
Research and development                           33,462         37,806
Selling, general and administrative                32,933         29,784
Amortization of acquired intangible assets        12,716       10,434     
Total Expenses                                    125,102      120,094    
Operating Income                                  13,529       32,145     
Other (Expense), net:
Interest income                                    161            299
Interest expense                                   (3,468     )   (10,170    )
Other (expense) income, net                       (170       )  923        
Total Other (Expense), net                        (3,477     )  (8,948     )
Income Before Income Taxes                        10,052       23,197     
Provision for Income Taxes                        2,718        764        
Net Income — GAAP                                 $ 7,334      $ 22,433   
                                                                  
Earnings Per Share:
GAAP earnings per share — basic and diluted        $ 0.05        $ 0.17     
Non-GAAP earnings per share — basic                $ 0.32        $ 0.41     
Non-GAAP earnings per share — diluted              $ 0.30        $ 0.39     
                                                                  
Weighted Average Number of Ordinary Shares
Outstanding:
Basic — GAAP and Non-GAAP                          134,602       130,434    
Diluted — GAAP and Non-GAAP                        143,369       134,945    
                                                                  
An itemized reconciliation between net income on
a GAAP basis and non-GAAP net income and free
cash flow is as follows:
Net Income — GAAP                                  $ 7,334        $ 22,433
Adjustments:
Non-cash net interest expense                      268            1,528
Non-cash taxes                                     2,814          (145       )
Depreciation expense                               11,011         7,584
Amortization expense                               12,716         10,434
Share-based compensation                           8,809          8,162
Deferred revenue                                   (97        )   2,970      
Non-GAAP Net Income                                $ 42,855       $ 52,966
Capital expenditure                                3,625         6,733      
Free Cash Flow                                     $ 39,230      $ 46,233   
                                                                             

                                                            
Condensed Consolidated Balance Sheets              June 30,        March 31,
(In thousands)                                 2013          2013
Cash, cash equivalents and total                   $ 324,990       $ 304,179
investments
Receivables                                        130,578         124,620
Inventory                                          39,128          43,483
Prepaid expenses and other current assets          23,838          19,133
Property, plant and equipment, net                 281,253         288,435
Intangible assets, net and goodwill                656,017         668,733
Other assets                                   22,050        21,708
Total Assets                                   $ 1,477,854   $ 1,470,291
Long-term debt — current portion                   $ 6,750         $ 6,750
Other current liabilities                          65,848          79,180
Long-term debt                                     360,690         362,258
Deferred revenue - long-term                       8,911           8,866
Other long-term liabilities                        53,715          60,863
Total shareholders' equity                     981,940       952,374
Total Liabilities and Shareholders' Equity     $ 1,477,854   $ 1,470,291
                                                                   
Ordinary shares outstanding (in thousands)         135,262         133,752
                                                           


This selected financial information should be read in conjunction with the
consolidated financial statements and notes thereto included in Alkermes plc's
Quarterly Report on Form 10-Q for the three months ended June 30, 2013, which
the company intends to file in July 2013.

Contact:

Alkermes Contacts:
For Investors:
Rebecca Peterson, +1 781-609-6378
or
For Media:
Jennifer Snyder, +1 781-609-6166