Delaware | 000-27756 | 13-3648318 |
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(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | |
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¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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(d) | Exhibits |
99.1 | Unaudited Pro Forma Combined Statements of Operations for the six months ended June 30, 2015 and the year ended December 31, 2014. |
Date: August 13, 2015 | ALEXION PHARMACEUTICALS, INC. | |
By: | /s/ Michael V. Greco | |
Name: Michael V. Greco | ||
Title: Vice President of Law and Corporate Secretary |
Alexion Pharmaceuticals, Inc. | Synageva BioPharma Corp. (Note 1) | Pro Forma Adjustments (Note 6) | Pro Forma Combined | |||||||||||||
Net product sales | $ | 1,236,316 | $ | — | $ | — | $ | 1,236,316 | ||||||||
Other revenue | 227 | 2,208 | — | 2,435 | ||||||||||||
Total revenues | 1,236,543 | 2,208 | — | 1,238,751 | ||||||||||||
Cost of sales | 121,406 | — | — | 121,406 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 352,773 | 125,134 | — | 477,907 | ||||||||||||
Selling, general and administrative | 408,499 | 113,083 | — | 521,582 | ||||||||||||
Acquisition-related costs | 45,800 | 62,071 | (91,848 | ) | (a) | 16,023 | ||||||||||
Restructuring expenses | 23,276 | 6,866 | (17,188 | ) | (b) | 12,954 | ||||||||||
Amortization of purchased intangible assets | — | 508 | — | 508 | ||||||||||||
Total operating expenses | 830,348 | 307,662 | (109,036 | ) | 1,028,974 | |||||||||||
Operating income (loss) | 284,789 | (305,454 | ) | 109,036 | 88,371 | |||||||||||
Other income and expense: | ||||||||||||||||
Investment income | 5,110 | 194 | — | 5,304 | ||||||||||||
Interest expense | (4,622 | ) | — | (33,391 | ) | (c) | (38,013 | ) | ||||||||
Foreign currency loss | (1,040 | ) | — | — | (1,040 | ) | ||||||||||
Other expense | — | (667 | ) | — | (667 | ) | ||||||||||
Income (loss) before income taxes | 284,237 | (305,927 | ) | 75,645 | 53,955 | |||||||||||
Income tax provision (benefit) | 22,699 | 383 | (1,086 | ) | (d) | 21,996 | ||||||||||
Net income (loss) | $ | 261,538 | $ | (306,310 | ) | $ | 76,731 | $ | 31,959 | |||||||
Earnings per common share | ||||||||||||||||
Basic | $1.30 | $0.14 | (e) | |||||||||||||
Diluted | $1.29 | $0.14 | (e) | |||||||||||||
Shares used in computing earnings per common share | ||||||||||||||||
Basic | 200,806 | 225,632 | (e) | |||||||||||||
Diluted | 203,302 | 227,672 | (e) |
Alexion Pharmaceuticals, Inc. | Synageva BioPharma Corp. after reclassifications (Note4) | Pro Forma Adjustments (Note 6) | Pro Forma Combined | |||||||||||||
Net product sales | $ | 2,233,733 | $ | — | $ | — | $ | 2,233,733 | ||||||||
Other Revenue | — | 6,492 | — | 6,492 | ||||||||||||
Total revenues | 2,233,733 | 6,492 | — | 2,240,225 | ||||||||||||
Cost of sales | 173,862 | — | — | 173,862 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 513,782 | 142,638 | — | 656,420 | ||||||||||||
Selling, general and administrative | 630,209 | 54,498 | — | 684,707 | ||||||||||||
Acquisition-related costs | 20,295 | — | — | 20,295 | ||||||||||||
Impairment of intangible assets | 11,514 | — | — | 11,514 | ||||||||||||
Restructuring expenses | 15,365 | — | — | 15,365 | ||||||||||||
Amortization of purchased intangible assets | — | 1,489 | — | 1,489 | ||||||||||||
Total operating expenses | 1,191,165 | 198,625 | — | 1,389,790 | ||||||||||||
Operating income (loss) | 868,706 | (192,133 | ) | — | 676,573 | |||||||||||
Other income and expense: | ||||||||||||||||
Investment income | 8,373 | 263 | — | 8,636 | ||||||||||||
Interest expense | (2,982 | ) | — | (79,371 | ) | (c) | (82,353 | ) | ||||||||
Foreign currency loss | (1,990 | ) | — | — | (1,990 | ) | ||||||||||
Other expense | — | (238 | ) | — | (238 | ) | ||||||||||
Income (loss) before income taxes | 872,107 | (192,108 | ) | (79,371 | ) | 600,628 | ||||||||||
Income tax provision (benefit) | 215,195 | 540 | (28,574 | ) | (d) | 187,161 | ||||||||||
Net income (loss) | $ | 656,912 | $ | (192,648 | ) | $ | (50,797 | ) | $ | 413,467 | ||||||
Earnings per common share | ||||||||||||||||
Basic | $3.32 | $1.84 | (e) | |||||||||||||
Diluted | $3.26 | $1.82 | (e) | |||||||||||||
Shares used in computing earnings per common share | ||||||||||||||||
Basic | 198,103 | 224,228 | (e) | |||||||||||||
Diluted | 201,623 | 227,765 | (e) |
For the year ended December 31, 2014 | |||||||||||
(in thousands) | Synageva before reclassification | Reclassifications | Synageva after reclassifications | ||||||||
Royalty revenue | $ | 6,000 | $ | (6,000 | ) | $ | — | ||||
Collaboration and license revenue | 492 | (492 | ) | — | |||||||
Other revenue | — | 6,492 | 6,492 | ||||||||
Amortization of developed technology | 1,489 | (1,489 | ) | — | |||||||
Amortization of purchased intangible assets | — | 1,489 | 1,489 | ||||||||
Interest income, net | 263 | (263 | ) | — | |||||||
Investment income | — | 263 | 263 |
Stock consideration | $ | 4,917,849 | |
Cash consideration | 4,565,485 | ||
Total purchase price | $ | 9,483,334 |
Cash | $ | 626,217 | |
Inventory | 61,710 | ||
Other current assets | 13,761 | ||
In-process research and development (IPR&D) | 4,236,000 | ||
Other noncurrent assets | 278,584 | ||
Assets acquired | 5,216,272 | ||
Deferred tax liability | (179,212 | ) | |
Other liabilities assumed | (306,795 | ) | |
Liabilities assumed | (486,007 | ) | |
Goodwill | 4,753,069 | ||
Total purchase price | $ | 9,483,334 |
(a) | Reflects non-recurring acquisition-related costs incurred by Alexion and Synageva during the six-months ended June 30, 2015 which were directly attributable to the Synageva acquisition. |
(b) | Reflects non-recurring restructuring expenses incurred by Alexion during the six-months ended June 30, 2015 which were directly attributable to the Synageva acquisition. |
(c) | Reflects an estimate of additional interest expense calculated based on weighted average rate of 2.23% for the six months ended June 30, 2015 and for the year ended December 31, 2014 based on $3,500,000 in debt incurred to fund the acquisition and $45,492 in debt issuance costs, partially offset by the elimination of Alexion’s interest expense incurred on Alexion’s outstanding debt that was refinanced. A change of 1/8 of a percent (0.125%) in the interest rate |
(d) | Reflects the estimated tax benefit due to the estimated change in taxable income resulting from the elimination of acquisition and restructuring costs related to the acquisition, offset by additional interest expense following the acquisition. For each pro forma adjustment, the statutory rate for the jurisdiction in which the adjustment is expected to occur was used. The effective tax rate of this adjustment and for the combined company could be materially different based on a number of factors including tax structuring activities, changes in tax law, jurisdictional mix of income and other factors. |
(e) | Reflects 26,125 shares issued by Alexion and 266 restricted stock units awarded to Synageva employees in connection with the acquisition, which results in basic and diluted earnings per common share of $0.14 for the six months ended June 30, 2015 and basic and diluted earnings per common share of $1.84 and $1.82, respectively, for the year ended December 31, 2014. |