Full Press Release Details
DUBLIN , May 5, 2020 /PRNewswire/ -- Jazz Pharmaceuticals plc (Nasdaq: JAZZ ) today announced financial results for the first quarter of 2020 and updated 2020 financial guidance.
"During this unprecedented time, I am proud of the commitment of our Jazz employees to supporting the continued delivery of our essential medicines to patients around the world," said Bruce Cozadd , chairman and chief executive officer of Jazz Pharmaceuticals. "Based on these efforts, we generated revenues of $535 million in the first quarter and continued to make progress toward our key 2020 objectives. JZP-258 and lurbinectedin received priority review with PDUFA action dates in the third quarter and, if approved, provide us the opportunity to deliver two new important treatment options to patients as early as the second half of this year. Following the EMA approval this January, we are poised to commence the rolling launch of Sunosi in Europe , beginning in Germany this month. In addition, we progressed patient enrollment in our pivotal study of JZP-458 and completed enrollment in our Phase 3 study of JZP-258 in idiopathic hypersomnia."
"Although we experienced limited financial impact of COVID-19 in the first quarter, we have updated our financial guidance to reflect the potential impact on our business for the remainder of 2020. We are proactively managing our operating expenses and prioritizing investments in our most important current and future revenue drivers," continued Mr. Cozadd. "We are excited about the opportunities ahead for Jazz and remain focused on diversifying our portfolio of essential medicines to provide innovative and life-changing options for patients. Our positive cash flow, strong balance sheet and access to significant additional liquidity position us well to manage through the impact of the COVID-19 pandemic on our business while continuing to drive future growth for shareholders."
| Financial Highlights | |||||||
| Three Months Ended March 31, | |||||||
| (In thousands, except per share amounts) | 2020 | 2019 | |||||
| Total revenues | $ | 534,726 | $ | 508,186 | |||
| GAAP net income (loss) | $ | (157,833) | $ | 85,201 | |||
| Adjusted net income 1 | $ | 25,833 | $ | 164,173 | |||
| GAAP EPS | $ | (2.82) | $ | 1.47 | |||
| Adjusted EPS 1 | $ | 0.45 | $ | 2.83 |
| ____________________________ | |
| 1. | Commencing in 2020, following consultation with the staff of the Division of Corporation Finance of the U.S. Securities and Exchange Commission, the company no longer excludes upfront and milestone payments from the company's non-GAAP adjusted net income, its line item components and non-GAAP adjusted EPS. For purposes of comparability, non-GAAP adjusted financial measures for the first quarter of 2019 have been updated to reflect this change. See "Non-GAAP Financial Measures" below. |
GAAP net loss for the first quarter of 2020 was $157 .8 million, or $2.82 per diluted share, compared to GAAP net income of $85.2 million , or $1.47 per diluted share, for the first quarter of 2019. GAAP net loss and non-GAAP adjusted net income for the first quarter of 2020 included the post-tax impact of a $200.0 million upfront payment made to Pharma Mar, S.A. (PharmaMar) for the exclusive U.S. commercialization and development rights to lurbinectedin.
Non-GAAP adjusted net income decreased in the first quarter of 2020 to $25 .8 million, or $0.45 per diluted share, from $164 .2 million, or $2.83 per diluted share, in the first quarter of 2019. Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included at the end of this press release.
Corporate Overview
Sleep and Neuroscience
Hematology/Oncology
| Total Revenues | |||||||
| Three Months Ended March 31, | |||||||
| (In thousands) | 2020 | 2019 | |||||
| Xyrem® (sodium oxybate) oral solution | $ | 407,875 | $ | 368,317 | |||
| Erwinaze® / Erwinase® (asparaginase Erwinia chrysanthemi ) | 37,732 | 60,899 | |||||
| Defitelio® (defibrotide sodium) / defibrotide | 47,432 | 41,500 | |||||
| Vyxeos® (daunorubicin and cytarabine) liposome for injection | 32,720 | 28,943 | |||||
| Sunosi® (solriamfetol) | 1,924 | — | |||||
| Other | 2,522 | 3,672 | |||||
| Product sales, net | 530,205 | 503,331 | |||||
| Royalties and contract revenues | 4,521 | 4,855 | |||||
| Total revenues | $ | 534,726 | $ | 508,186 |
Total revenues increased 5% in the first quarter of 2020 compared to the same period in 2019.
| Operating Expenses and Effective Tax Rate | |||||||
| Three Months Ended March 31, | |||||||
| (In thousands, except percentages) | 2020 | 2019 | |||||
| GAAP: | |||||||
| Cost of product sales | $ | 28,657 | $ | 33,506 | |||
| Gross margin | 94.6% | 93.3% | |||||
| Selling, general and administrative | $ | 208,400 | $ | 167,947 | |||
| % of total revenues | 39.0% | 33.0% | |||||
| Research and development | $ | 86,107 | $ | 60,105 | |||
| % of total revenues | 16.1% | 11.8% | |||||
| Acquired in-process research and development | $ | 202,250 | $ | 56,000 | |||
| Impairment charge | $ | 136,139 | $ | — | |||
| Income tax provision (benefit) | $ | (51,287) | $ | 29,116 | |||
| Effective tax rate | 24.5% | 25.3% | |||||
| Three Months Ended March 31, | |||||||
| (In thousands, except percentages) | 2020 | 2019 | |||||
| Non-GAAP adjusted: | |||||||
| Cost of product sales | $ | 26,984 | $ | 31,847 | |||
| Gross margin | 94.9% | 93.7% | |||||
| Selling, general and administrative | $ | 187,804 | $ | 147,577 | |||
| % of total revenues | 35.1% | 29.0% | |||||
| Research and development | $ | 79,722 | $ | 54,582 | |||
| % of total revenues | 14.9% | 10.7% | |||||
| Acquired in-process research and development | $ | 202,250 | $ | 56,000 | |||
| Income tax provision | $ | 4,687 | $ | 45,714 | |||
| Effective tax rate | 15.4% | 21.7% |
Operating expenses increased over the prior year period primarily due to the following:
Cash Flow and Balance Sheet
As of March 31, 2020, cash, cash equivalents and investments were $1.0 billion , and the outstanding principal balance of the company's long-term debt was $1.8 billion . During the first quarter of 2020, the company generated $273.0 million of cash from operations, made an upfront payment of $200.0 million to PharmaMar under a license agreement and used $139.1 million to repurchase shares under the company's share repurchase program.
In the first quarter of 2020, the company repurchased approximately 1.1 million ordinary shares under the company's share repurchase program at an average cost of $122.91 per ordinary share. As of March 31, 2020, the remaining amount authorized for share repurchases under the company's share repurchase program was $438.7 million .
2020 Financial Guidance
The May 5, 2020 guidance provided below reflects the anticipated financial impact of COVID-19 to the company's business. This guidance assumes the majority of the negative impact will be in the second quarter, with a return to normalized operations later in the year (in millions, except per share amounts and percentages).
| Guidance provided as of | ||
| February 25, 2020 | May 5, 2020 | |
| Revenues | $2,320 - $2,400 | $2,120 - $2,260 |
| Total net product sales | $2,305 - $2,375 | $2,105 - $2,240 |
| -Sleep/Neuroscience net sales | $1,740 - $1,810 | $1,650 - $1,740 |
| -Hematology/Oncology net sales | $500 - $580 | $420 - $510 1 |
| ____________________________ | |
| 1. | Lurbinectedin net sales included in Hematology/Oncology net sales for May 5, 2020 guidance; included in Revenues and Total net product sales as of each date. |
| GAAP: | ||
| Guidance provided as of | ||
| February 25, 2020 | May 5, 2020 | |
| Gross margin % | 94% | 94% |
| SG&A expenses | $855 - $903 | $785 - $843 |
| SG&A expenses as % of total revenues | 36% - 39% | 35% - 40% |
| R&D Expenses | $312 - $348 | $277 - $313 |
| R&D expenses as % of total revenues | 13% - 15% | 12% - 15% |
| Acquired in-process research and development expenses | $200 | $202 |
| Impairment charge | — | $136 |
| Effective tax rate | 15% - 23% | 22% - 29% |
| Net income per diluted share | $5.90 - $7.15 | $2.70 - $4.30 |
| Non-GAAP: | ||
| Guidance provided as of | ||
| February 25, 2020 | May 5, 2020 | |
| Gross margin % | 94% | 94% 1,6 |
| SG&A expenses | $770 - $810 | $700 - $750 2,6 |
| SG&A expenses as % of total revenues | 32% - 35% | 31% - 35% |
| R&D Expenses | $285 - $315 | $250 - $280 3,6 |
| R&D expenses as % of total revenues | 12% - 14% | 11% - 13% |
| Acquired in-process research and development expenses | $200 | $202 4 |
| Effective tax rate | 18% - 20% | 20% - 23% 5,6 |
| Net income per diluted share | $12.50 - $13.40 | $11.25 - $12.50 4,6 |
| ____________________________ | |
| 1. | Excludes $8-$9 million of share-based compensation expense from estimated GAAP gross margin. |
| 2. | Excludes $85-$93 million of share-based compensation expense from estimated GAAP SG&A expenses. |
| 3. | Excludes $27-$33 million of share-based compensation expense from estimated GAAP R&D expenses. |
| 4. | Commencing in 2020, the company no longer excludes upfront and milestone payments from the company's non-GAAP adjusted net income, its line item components and non-GAAP adjusted EPS. The impact of this change to the company's 2020 non-GAAP adjusted net income and non-GAAP adjusted EPS guidance is approximately $175 million or $3.13 per diluted share, respectively, related to the post-tax impact of the $200 million upfront payment made to PharmaMar in January 2020. |
| 5. | Excludes the income tax effect of adjustments between GAAP reported and non-GAAP adjusted net income. |
| 6. | See "Non-GAAP Financial Measures" below. Reconciliations of non-GAAP adjusted guidance measures are included above and in the table titled "Reconciliation of GAAP to Non-GAAP Adjusted 2020 Net Income Guidance" at the end of this press release. |
Conference Call Details
Jazz Pharmaceuticals will host an investor conference call and live audio webcast today at 4:30 p.m. EDT ( 9:30 p.m. IST ) to provide a business and financial update and discuss its 2020 first quarter results. The live webcast may be accessed from the Investors section of the company's website at www.jazzpharmaceuticals.com . Please connect to the website prior to the start of the conference call to ensure adequate time for any software downloads that may be necessary. Investors may participate in the conference call by dialing +1 855 353 7924 in the U.S., or +1 503 343 6056 outside the U.S., and entering passcode 3491256.
A replay of the conference call will be available through May 12, 2020 by dialing +1 855 859 2056 in the U.S., or +1 404 537 3406 outside the U.S., and entering passcode 3491256. An archived version of the webcast will be available for at least one week in the Investors section of the company's website at www.jazzpharmaceuticals.com .
About Jazz Pharmaceuticals plc
Jazz Pharmaceuticals plc (Nasdaq: JAZZ ) is a global biopharmaceutical company dedicated to developing life-changing medicines for people with serious diseases — often with limited or no options. We have a diverse portfolio of marketed medicines and novel product candidates, from early- to late-stage development, in key therapeutic areas. Our focus is in neuroscience, including sleep medicine and movement disorders, and in oncology, including hematologic and solid tumors. We actively explore new options for patients including novel compounds, small molecule advancements, biologics and innovative delivery technologies. Jazz is headquartered in Dublin, Ireland and has employees around the globe, serving patients in more than 90 countries. For more information, please visit www.jazzpharmaceuticals.com and follow @JazzPharma on Twitter.
Non-GAAP Financial Measures
To supplement Jazz Pharmaceuticals' financial results and guidance presented in accordance with U.S. generally accepted accounting principles (GAAP), the company uses certain non-GAAP (also referred to as adjusted or non-GAAP adjusted) financial measures in this press release and the accompanying tables. In particular, the company presents non-GAAP adjusted net income (and the related per share measure) and its line item components, as well as certain non-GAAP adjusted financial measures derived therefrom, including non-GAAP adjusted gross margin percentage and non-GAAP adjusted effective tax rate. Non-GAAP adjusted net income (and the related per share measure) and its line item components exclude from GAAP reported net income (loss) (and the related per share measure) and its line item components certain items, as detailed in the reconciliation tables that follow, and in the case of non-GAAP adjusted net income (and the related per share measure), adjust for the income tax effect of non-GAAP adjustments. In this regard, the components of non-GAAP adjusted net income, including non-GAAP cost of product sales, non-GAAP SG&A expenses and non-GAAP R&D expenses, are income statement line items prepared on the same basis as, and therefore components of, the overall non-GAAP adjusted net income measure.
These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures; should be read in conjunction with the company's consolidated financial statements prepared in accordance with GAAP; have no standardized meaning prescribed by GAAP; and are not prepared under any comprehensive set of accounting rules or principles. In addition, from time to time in the future there may be other items that the company may exclude for purposes of its non-GAAP financial measures; and the company has ceased, and may in the future cease, to exclude items that it has historically excluded for purposes of its non-GAAP financial measures. For example, commencing in 2020, the company no longer excludes upfront and milestone payments from the company's non-GAAP adjusted net income, its line item components and non-GAAP adjusted EPS. For purposes of comparability, non-GAAP adjusted financial measures for the first quarter of 2019 have been updated to reflect this change. Accordingly, such payments are not excluded from its non-GAAP financial measures for the three months ended March 31, 2020 and 2019, or from 2020 non-GAAP adjusted net income guidance and non-GAAP adjusted net income per diluted share guidance as detailed in the reconciliation tables that follow. Likewise, the company may determine to modify the nature of its adjustments to arrive at its non-GAAP financial measures. Because of the non-standardized definitions of non-GAAP financial measures, the non-GAAP financial measures as used by Jazz Pharmaceuticals in this press release and the accompanying tables have limits in their usefulness to investors and may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by other companies.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995
This press release contains forward-looking statements, including, but not limited to, statements related to Jazz Pharmaceuticals' future financial and operating results, including the company's updated 2020 financial guidance and 2020 planned milestones and the anticipated timing thereof, including the rolling launch of Sunosi in Europe , the potential approval and launch of lurbinectedin and JZP-258 in the U.S.; the company's clinical development of and planned BLA submission for JZP-458; the company's plan to proactively manage operating expenses and prioritize investments in the most important revenue drivers; the company's focus on diversifying its portfolio of essential medicines to provide innovative and life-changing options for patients; the company's belief that its cash flow, balance sheet and access to additional liquidity position it well to manage through the impact of the COVID-19 pandemic while driving future growth; the company's belief that Xyrem demand in 2020 will remain strong; the company's expectations of inter-quarter variability in Defitelio net sales and Erwinaze net sales and the reasons therefor; and other statements that are not historical facts. These forward-looking statements are based on the company's current plans, objectives, estimates, expectations and intentions and inherently involve significant risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks and uncertainties associated with: the scale, duration and evolving effects of the COVID-19 pandemic and resulting global economic, financial, and healthcare system disruptions and the current and potential future negative impacts to the company's business operations and financial results; maintaining or increasing sales of and revenue from Xyrem; effectively commercializing the company's other products and product candidates, including with respect to Sunosi and, if approved, lurbinectedin and JZP-258; the time-consuming and uncertain regulatory approval process, including the risk that the company's current and planned regulatory submissions may not be submitted, accepted or approved by applicable regulatory authorities in a timely manner or at all; the costly and time-consuming pharmaceutical product development and the uncertainty of clinical success, including risks related to failure or delays in successfully initiating or completing clinical trials and assessing patients such as those being experienced, and expected to continue to be experienced, by the company as a result of the COVID-19 pandemic; protecting and enhancing the company's intellectual property rights; delays or problems in the supply or manufacture of the company's products and product candidates; complying with applicable U.S. and non-U.S. regulatory requirements; government investigations and other actions; obtaining and maintaining adequate coverage and reimbursement for the company's products; identifying and acquiring, in-licensing or developing additional products or product candidates, financing these transactions and successfully integrating acquired product candidates, products and businesses; the company's ability to realize the anticipated benefits of its collaborations with third parties for the development of product candidates; the company's ability to achieve expected future financial performance and results and the uncertainty of future tax and other provisions and estimates; and other risks and uncertainties affecting the company, including those described from time to time under the caption "Risk Factors" and elsewhere in Jazz Pharmaceuticals plc's Securities and Exchange Commission filings and reports (Commission File No. 001-33500), including the company's Annual Report on Form 10-K for the year ended December 31, 2019 and future filings and reports by the company, including the company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 . In addition, while the company expects the COVID-19 pandemic to continue to adversely affect its business operations and financial results, the extent of the impact on the company's ability to generate sales of and revenues from its approved products, its clinical development and regulatory efforts, its corporate development objectives and the value of and market for its ordinary shares, will depend on future developments that are highly uncertain and cannot be predicted with confidence at this time, such as the ultimate duration of the pandemic, travel restrictions, quarantines, social distancing and business closure requirements in the U.S., Ireland and other countries, and the effectiveness of actions taken globally to contain and treat the disease. Moreover, other risks and uncertainties of which the company is not currently aware may also affect the company's forward-looking statements and may cause actual results and the timing of events to differ materially from those anticipated.
| JAZZ PHARMACEUTICALS PLC CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (In thousands, except per share amounts) (Unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| 2020 | 2019 | ||||||
| Revenues: | |||||||
| Product sales, net | $ | 530,205 | $ | 503,331 | |||
| Royalties and contract revenues | 4,521 | 4,855 | |||||
| Total revenues | 534,726 | 508,186 | |||||
| Operating expenses: | |||||||
| Cost of product sales (excluding amortization of acquired developed technologies) | 28,657 | 33,506 | |||||
| Selling, general and administrative | 208,400 | 167,947 | |||||
| Research and development | 86,107 | 60,105 | |||||
| Intangible asset amortization | 62,847 | 56,885 | |||||
| Acquired in-process research and development | 202,250 | 56,000 | |||||
| Impairment charge | 136,139 | — | |||||
| Total operating expenses | 724,400 | 374,443 | |||||
| Income (loss) from operations | (189,674) | 133,743 | |||||
| Interest expense, net | (18,496) | (17,922) | |||||
| Foreign exchange loss | (1,132) | (611) | |||||
| Income (loss) before income tax provision (benefit) and equity in loss (gain) of investees | (209,302) | 115,210 | |||||
| Income tax provision (benefit) | (51,287) | 29,116 | |||||
| Equity in loss (gain) of investees | (182) | 893 | |||||
| Net income (loss) | $ | (157,833) | $ | 85,201 | |||
| Net income (loss) per ordinary share: | |||||||
| Basic | $ | (2.82) | $ | 1.49 | |||
| Diluted | $ | (2.82) | $ | 1.47 | |||
| Weighted-average ordinary shares used in per share calculations - basic | 55,956 | 57,206 | |||||
| Weighted-average ordinary shares used in per share calculations - diluted | 55,956 | 58,081 |
| JAZZ PHARMACEUTICALS PLC CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) | |||||||
| March 31, 2020 | December 31, 2019 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 701,602 | $ | 637,344 | |||
| Investments | 280,000 | 440,000 | |||||
| Accounts receivable, net of allowances | 317,301 | 355,987 | |||||
| Inventories | 85,610 | 78,608 | |||||
| Prepaid expenses | 38,824 | 39,434 | |||||
| Other current assets | 94,300 | 78,895 | |||||
| Total current assets | 1,517,637 | 1,630,268 | |||||
| Property, plant and equipment, net | 129,562 | 131,506 | |||||
| Operating lease assets | 135,976 | 139,385 | |||||
| Intangible assets, net | 2,238,658 | 2,440,977 | |||||
| Goodwill | 909,226 | 920,018 | |||||
| Deferred tax assets, net | 230,242 | 221,403 | |||||
| Deferred financing costs | 6,887 | 7,426 | |||||
| Other non-current assets | 47,107 | 47,914 | |||||
| Total assets | $ | 5,215,295 | $ | 5,538,897 | |||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 66,308 | $ | 47,545 | |||
| Accrued liabilities | 261,041 | 267,873 | |||||
| Current portion of long-term debt | 33,387 | 33,387 | |||||
| Income taxes payable | 31,211 | 10,965 | |||||
| Deferred revenue | 4,176 | 4,720 | |||||
| Total current liabilities | 396,123 | 364,490 | |||||
| Deferred revenue, non-current | 4,225 | 4,861 | |||||
| Long-term debt, less current portion | 1,576,984 | 1,573,870 | |||||
| Operating lease liabilities, less current portion | 147,110 | 151,226 | |||||
| Deferred tax liabilities, net | 165,095 | 224,095 | |||||
| Other non-current liabilities | 117,258 | 109,374 | |||||
| Total shareholders' equity | 2,808,500 | 3,110,981 | |||||
| Total liabilities and shareholders' equity | $ | 5,215,295 | $ | 5,538,897 |
| JAZZ PHARMACEUTICALS PLC SUMMARY OF CASH FLOWS (In thousands) (Unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| 2020 | 2019 | ||||||
| Net cash provided by operating activities | $ | 272,969 | $ | 202,253 | |||
| Net cash provided by (used in) investing activities | (60,080) | 166,052 | |||||
| Net cash used in financing activities | (147,683) | (130,349) | |||||
| Effect of exchange rates on cash and cash equivalents | (948) | (112) | |||||
| Net increase in cash and cash equivalents | $ | 64,258 | $ | 237,844 |
| JAZZ PHARMACEUTICALS PLC RECONCILIATIONS OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION (In thousands, except per share amounts) (Unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| 2020 | 2019 | ||||||
| GAAP reported net income (loss) | $ | (157,833) | $ | 85,201 | |||
| Intangible asset amortization | 62,847 | 56,885 | |||||
| Share-based compensation expense | 28,654 | 27,552 | |||||
| Impairment charge (a) | 136,139 | — | |||||
| Non-cash interest expense (b) | 12,000 | 11,133 | |||||
| Income tax effect of above adjustments | (55,974) | (16,598) | |||||
| Non-GAAP adjusted net income | $ | 25,833 | $ | 164,173 | |||
| GAAP reported net income (loss) per diluted share | $ | (2.82) | $ | 1.47 | |||
| Non-GAAP adjusted net income per diluted share | $ | 0.45 | $ | 2.83 | |||
| Weighted-average ordinary shares used in diluted per share calculations - GAAP | 55,956 | 58,081 | |||||
| Weighted-average ordinary shares used in diluted per share calculations - non-GAAP | 56,792 | 58,081 |
| ________________________________________________ | |
| Explanation of Adjustments and Certain Line Items: | |
| (a) | Impairment charge related to the company's decision to stop enrollment in its Phase 3 clinical study of defibrotide for the prevention of VOD due to a determination by an Independent Data Monitoring Committee that it is highly unlikely that the study will reach its primary endpoint. |
| (b) | Non-cash interest expense associated with debt discount and debt issuance costs. |
| JAZZ PHARMACEUTICALS PLC RECONCILIATIONS OF GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION CERTAIN LINE ITEMS - FOR THE THREE MONTHS ENDED MARCH 31, 2020 and 2019 (In thousands, except percentages) (Unaudited) | |||||||||||||||||||||||||||||||||
| Three months ended March 31, 2020 | |||||||||||||||||||||||||||||||||
| Cost of product sales | Gross margin | Selling, general and administrative | Research and development | Intangible asset amortization | Impairment charge | Interest expense, net | Income tax provision (benefit) | Effective tax rate | |||||||||||||||||||||||||
| GAAP Reported | $ | 28,657 | 94.6% | $ | 208,400 | $ | 86,107 | $ | 62,847 | $ | 136,139 | $ | 18,496 | $ | (51,287) | 24.5% | |||||||||||||||||
| Non-GAAP Adjustments: | |||||||||||||||||||||||||||||||||
| Intangible asset amortization | — | — | — | — | (62,847) | — | — | — | — | ||||||||||||||||||||||||
| Share-based compensation expense | (1,673) | 0.3 | (20,596) | (6,385) | — | — | — | — | — | ||||||||||||||||||||||||
| Impairment charge | — | — | — | — | — | (136,139) | — | — | — | ||||||||||||||||||||||||
| Non-cash interest expense | — | — | — | — | — | — | (12,000) | — | — | ||||||||||||||||||||||||
| Income tax effect of above adjustments | — | — | — | — | — | — | — | 55,974 | (9.1) | ||||||||||||||||||||||||
| Total of Non-GAAP adjustments | (1,673) | 0.3 | (20,596) | (6,385) | (62,847) | (136,139) | (12,000) | 55,974 | (9.1) | ||||||||||||||||||||||||
| Non-GAAP Adjusted | $ | 26,984 | 94.9% | $ | 187,804 | $ | 79,722 | $ | — | $ | — | $ | 6,496 | $ | 4,687 | 15.4% | |||||||||||||||||
| Three months ended March 31, 2019 | |||||||||||||||||||||||||||||||||
| Cost of product sales | Gross margin | Selling, general and administrative | Research and development | Intangible asset amortization | Interest expense, net | Income tax provision | Effective tax rate | ||||||||||||||||||||||||||
| GAAP Reported | $ | 33,506 | 93.3% | $ | 167,947 | $ | 60,105 | $ | 56,885 | $ | 17,922 | $ | 29,116 | 25.3% | |||||||||||||||||||
| Non-GAAP Adjustments: | |||||||||||||||||||||||||||||||||
| Intangible asset amortization | — | — | — | — | (56,885) | — | — | — | |||||||||||||||||||||||||
| Share-based compensation expense | (1,659) | 0.4 | (20,370) | (5,523) | — | — | — | — | |||||||||||||||||||||||||
| Non-cash interest expense | — | — | — | — | — | (11,133) | — | — | |||||||||||||||||||||||||
| Income tax effect of above adjustments | — | — | — | — | — | — | 16,598 | (3.6) | |||||||||||||||||||||||||
| Total of Non-GAAP adjustments | (1,659) | 0.4 | (20,370) | (5,523) | (56,885) | (11,133) | 16,598 | (3.6) | |||||||||||||||||||||||||
| Non-GAAP Adjusted | $ | 31,847 | 93.7% | $ | 147,577 | $ | 54,582 | $ | — | $ | 6,789 | $ | 45,714 | 21.7% |
| JAZZ PHARMACEUTICALS PLC RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED 2020 NET INCOME GUIDANCE (In millions, except per share amounts) (Unaudited) | |
| GAAP net income | $150 - $240 |
| Intangible asset amortization | 250 - 270 |
| Share-based compensation expense | 120 -135 |
| Impairment charge | 136 |
| Non-cash interest expense | 45 - 55 |
| Income tax effect of adjustments | (105) - (115) |
| Non-GAAP adjusted net income | $630 - $700 |
| GAAP net income per diluted share | $2.70 - $4.30 |
| Non-GAAP adjusted net income per diluted share | $11.25 - $12.50 |
| Weighted-average ordinary shares used in per share calculations | 56 |
Investors: Kathee Littrell Vice President, Investor Relations Jazz Pharmaceuticals plc Ireland , +353 1 634 7887 U.S., +1 650 496 2717
Media: Jacqueline Kirby Vice President, Corporate Affairs & Government Relations Jazz Pharmaceuticals plc Ireland , +353 1 697 2141 U.S., +1 215 867 4910
SOURCE Jazz Pharmaceuticals plc