ALLSCHWIL/BASEL, SWITZERLAND - 18 October 2012 - Actelion Ltd (SIX: ATLN) today announced its financial results for the first nine months of 2012.

In CHF Million (except for per share data)	Results 9M 2012	Results 9M 2011	% Variance In CHF	% Variance In LC
Product sales	1,298.6	1,290.2	1	(3)
US GAAP Operating income	359.0	(85.6)	-	-
Core earnings excluding DDP	443.6	390.6	14	7
Core earnings	465.8	388.9	20	13
US GAAP EPS (fully diluted)	2.26	(1.52)	-	-

As of 30 September 2012, Actelion had cash and cash deposits of CHF 1.5 billion (of which CHF 374 million is restricted). In addition, Actelion holds 11.7 million treasury shares.

Jean-Paul Clozel, M.D and Chief Executive Officer commented: "In the first nine months of 2012, Actelion has made substantial progress. We are rapidly implementing our cost savings initiative and putting our near-term focus on macitentan. This focus has also allowed rapid progress in turning the outstanding clinical data obtained in pulmonary arterial hypertension into regulatory submissions and scientific presentations and publications."

Jean-Paul Clozel concluded: "Actelion remains committed to continued value creation for our shareholders. In Q3 2012, we have started to accelerate the ongoing share buy back and will conclude the current 800 million Swiss Franc program within the coming 12 months."

Andrew Oakley, Chief Financial Officer, commented: "With the Cost Saving Initiative now implemented, we are booking a 5.1 million Swiss Franc charge in the third quarter 2012 financial statements. This charge is excluded from our core earnings measure. In the coming quarters, there will be some additional charges to reach a total restructuring charge between 8 and 9 million Swiss Francs, subject to FX fluctuations."

Andrew Oakley concluded: "Our 2012 performance is on track and therefore our local currency guidance remains unchanged with low-single digit product sales decline and mid-single digit core earnings growth, excluding the impact of doubtful debt provisions. The outlook for 2013 also remains unchanged, with core earnings flat compared to the higher 2012 base, returning to single digit growth in 2014 and double digit growth in 2015."

Update on Actelion's progress to strengthen PAH franchise with new products

The results from the first ever Phase III long-term outcome study with macitentan in patients with pulmonary arterial hypertension (PAH) are to be presented on Tuesday, 23 October 2012, 4:30 pm at the annual CHEST meeting of the American College of Chest Physicians (ACCP) in Atlanta (Georgia).

The title of the presentation is: "Effect of Macitentan on Morbidity and Mortality in Pulmonary Arterial Hypertension (PAH): Results from the SERAPHIN Trial." The presenter is Lewis J. Rubin, M.D., Emeritus Professor, University of California, San Diego and Senior Advisor on SERAPHIN (Study with an Endothelin Receptor Antagonist in Pulmonary arterial Hypertension to Improve cliNical outcome).

Also on Tuesday evening at CHEST, a company-sponsored symposium will discuss "Perspectives in PAH: The Evolution of Clinical Trial Design and Clinical Practice. The symposium is chaired by Professor Vallerie V. McLaughlin, MD, University of Michigan Health System, Ann Arbor, Michigan.

Otto Schwarz, Chief Operating Officer, commented: "I am very pleased with the progress we are making with moving macitentan forward. This promising molecule has now been named Opsumit^®. In the coming weeks, I expect that we will submit regulatory filings to Health Authorities in the United States, Europe and Switzerland for this novel endothelin receptor antagonist."

Actelion is also continuing its efforts to further strengthen its product offerings for PAH with Selexipag. This IP receptor agonist is being evaluated in the multicenter, double-blind, placebo controlled trial Phase III outcome study GRIPHON (Prostacyclin PGI2 Receptor agonist in pulmonary arterial hypertension). GRIPHON is currently enrolling a target of 1,150 patients around the world. This pivotal study is designed to demonstrate a reduction in the risk of morbidity/mortality events.

Results are expected to be available mid-2014. There will be an interim analysis for efficacy and futility at around two thirds of the total number of required events expected by mid-2013.

Revenue performance

Product sales for the first nine months of 2012 were CHF 1,298.6 million (9M 2011: CHF 1,290.2 m), a decrease of 3 % in local currencies, with 42 % of sales coming from the United States, 37 % from Europe, 11 % from Japan and 10 % from the rest of the world.

Tracleer^® (bosentan) sales decreased by 4 % in local currencies to total CHF 1,130.9 million. The decrease is attributed to the competitive situation in the US as well as price cuts in other regions.Underlying unit growth (+1 %) was driven by Japan, Europe and other markets.

Ventavis^® (iloprost) sales for the period were CHF 85.1 million. This represents a decrease of 3 % in local currencies, the result of a decline in units shipped.

Sales of Veletri^® (epoprostenol for injection), amounted to CHF 18.0 million during the first nine months of 2012, compared to CHF 10.9 million during the same period in 2011. Regulatory approval was recently obtained for the improved second formulation in both the US and Switzerland with reviews ongoing in Japan and Europe.

Sales of Zavesca^® (miglustat), for the first nine months of 2012 amounted to CHF 62.5 million compared to CHF 51.2 million during the same period last year. This represents an increase of 22 % in local currencies driven predominantly by strong patient demand in Niemann Pick Type-C indication (outside the US) as well as a positive US pricing impact.

Contract revenues for the first nine months of 2012 amounted to CHF 4.8 million. As a reminder, the nine months of 2011 included the remaining deferred revenue from the ongoing orexin collaboration with GlaxoSmithKline (CHF 76.5 m).

Operating expenses

Total operating expenses for the first nine months of 2012 were CHF 944.5 million compared to CHF 1,457.2 million for the first nine months of 2011, which included the Asahi litigation provision of CHF 430.2 million. During the third quarter 2012, the company booked a restructuring charge of CHF 5.1 million that is included in operating expenses. Cash operating expenses for the first nine months of 2012 were down 5 % in Swiss Francs and 7 % in local currencies.

Research and Development (R&D) expenses in the first nine months of 2012 were up 1 % to CHF 334.3 million (9M 2011: CHF 331.4 m). This increase includes the USD 10 million milestone payment to Auxilium Pharmaceuticals, Inc. in relation to our collaboration on XIAFLEX^® in certain territories. Non-GAAP R&D expenses for the same period, which excludes stock-based compensation expense, amortization and depreciation, were CHF 285.0 million compared to CHF 287.9 million in the first nine months of 2011, a 1 % decrease.

Selling, General and Administrative expenses (SG&A) for the first nine months of 2012 were CHF 431.7 million (9M 2011: CHF 517.4 m). The net benefit from the reduction in the allowance for doubtful debt on receivables in Southern Europe for the first nine months of this year was CHF 22.2 million. Additionally, lower legal expenses as well as tight cost control contributed to this decrease.

Non-GAAP SG&A expenses for the first nine months of 2012, which excludes stock-based compensation expense, amortization and depreciation, were CHF 420.6 million compared to CHF 462.8 million in the first nine months of 2011, a decrease of 9 %.

Operating income

Operating income for the first nine months of 2012 was CHF 359.0 million compared to an operating loss of CHF 85.6 million for the same period in 2011.

In order to better compare the company's underlying performance, Actelion reports core earnings as product sales minus cash operating expenses, as well as other items that may distort comparison (reconciliation is provided at the end of this release and on www.actelion.com).

For the first nine months of 2012, core earnings amounted to CHF 465.8 million compared to CHF 388.9 million during the first nine months of 2011. This represents an increase of 13 % in local currencies. Excluding the movement in the doubtful debt provision, the increase was 7 % in local currencies.

Net income

Net income for the first nine months of 2012 amounted to CHF 268.3 million (9M 2011: net loss of CHF 180.7 m).

Net income for the period includes interest income of CHF 1.6 million, interest expense related to litigation provisions of CHF 31.2 million, interest expense on the CHF 235 million bond of CHF 9.0 million, other interest expense of CHF 0.5 million, impairment on financial assets of CHF 0.3 million, other financial expense of CHF 1.9 million as well as an income tax expense of CHF 49.3 million.

The net income translates into fully diluted earnings per share of CHF 2.26 compared to a loss per share of CHF 1.52 in the first nine months of 2011. Core EPS for the period under review amounted to CHF 3.25, an increase of 24 % compared to the same period in 2011.

Upcoming events

Pipeline updates in Q4 2012

• Macitentan presentation at CHEST - 23 October 2012
• Macitentan submission of registration dossier to Health Authorities
• Cadazolid in C. difficile infection proof-of-concept results
• Ponesimod in psoriasis Phase II results

Corporate Reporting

• FY 2012 Financial Results - 14 February 2013
• Q1 2013 Financial Results - 16 April 2013
• Actelion's Annual General Meeting 2013 - 18 April 2013

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Actelion, Opsumit, Tracleer, Veletri, Ventavis, and Zavesca are trademarks registered in the United States and other countries.

 

For Documentation Purposes

Full Financial Statement:

The full financial statement for the first nine months of 2012 can be found as a PDF attached to the media release. It is also available on www.actelion.com in the Investor section

http://www.actelion.com/en/investors/financial-information/finance-archive/index.page?

Non-GAAP to US GAAP Operating Income reconciliation

In CHF million				9M 2012	9M 2011
Core earnings excluding impact of DDP				443.6	390.6
Movement in doubtful debt provision				22.2	(1.8)
Core earnings				465.8	388.9
Contract revenues				4.8	81.4
Stock option expenses				(35.6)	(64.1)
Amortization and depreciation				(61.9)	(61.6)
Litigation provision				-	(430.2)
Auxilium milestone payment				(9.1)	-
Restructuring charge				(5.1)	-
US GAAP Operating Income				359.0	(85.6)

Core EPS calculation

In CHF million	9M 2012	9M 2011
Core earnings	465.8	388.9
Non-GAAP financial result	(10.2)	(25.4)
Adjusted income before tax	455.6	363.5
Tax	(70.7)	(52.2)
Adjusted net income	384.9	311.3
No of fully diluted shares outstanding	118.5	119.2
Core EPS	3.25	2.61

Notes to the editor:

Actelion Ltd.

Actelion Ltd is a biopharmaceutical company with its corporate headquarters in Allschwil/Basel, Switzerland.  Actelion's first drug Tracleer®, an orally available dual endothelin receptor antagonist, has been approved as a therapy for pulmonary arterial hypertension.  Actelion markets Tracleer® through its own subsidiaries in key markets worldwide, including the United States (based in South San Francisco), the European Union, Japan, Canada, Australia and Switzerland. Actelion, founded in late 1997, is a leading player in innovative science related to the endothelium - the single layer of cells separating every blood vessel from the blood stream.  Actelion's over 2,400 employees focus on the discovery, development and marketing of innovative drugs for significant unmet medical needs. Actelion shares are traded on the SIX Swiss Exchange (ticker symbol: ATLN) as part of the Swiss blue-chip index SMI (Swiss Market Index SMI®).

For further information please contact:

Roland Haefeli Senior Vice President, Head of Investor Relations & Public Affairs Actelion Pharmaceuticals Ltd, Gewerbestrasse 16, CH-4123 Allschwil +41 61 565 62 62 +1 650 624 69 36 www.actelion.com

 

Conference Call Information

Actelion Ltd will announce the first nine months 2012 financial results on Thursday, 18 October 2012, at 07.00 hrs CEST / 06.00 hrs BST / 01.00 a.m. EDT. An investor conference call & webcast will be held at 14.00 hrs, CEST to discuss the results.

Date/Time:

18 October 2012	14.00 hrs	Basel (CEST)
	13.00 hrs	UK (BST)
	08.00 a.m	US (EDT)

Conference Call Connect #:

Dial-in participants should start calling the number below 10-15 minutes before the conference is due to start.

Dial:        Europe:                  +41 (0) 44 580 00 74

UK:                         +44 (0)203 367 94 54

US:                         +1 866 9075 923

 

Participant's mode: Listen-Only with possibility to open individual lines during Q&A session. Participants will be asked for their Name and Company.

Webcast Access:

Webcast participants should visit the Actelion website http://www.actelion.com 10-15 minutes before the conference is due to start.

Participant's mode: Listen-Only

Webcast Replay:

The archived Investor Webcast will be available for replay through http://www.actelion.com approximately 60 minutes after the call has ended.