þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required)
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Delaware
(State or other jurisdiction of
incorporation or organization)
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04-3324394
(I.R.S. Employer
Identification No.)
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8 Sylvan Way
Parsippany, New Jersey
(Address of principal executive offices)
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07054
(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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Part I. Financial Information
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EX-10.1
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EX-10.2
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EX-10.3
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EX-10.4
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EX-10.5
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EX-10.6
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EX-31.1
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EX-31.2
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EX-32.1
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EX-32.2
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June 30,
2013 |
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December 31,
2012 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
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$
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292,891
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|
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$
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519,446
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Available for sale securities
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8,112
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|
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50,875
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|
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Accrued interest receivable
|
75
|
|
|
348
|
|
||
Accounts receivable, net of allowances of approximately $23.4 million and $17.7 million at June 30, 2013 and December 31, 2012, respectively
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90,333
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|
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85,893
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|
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Inventory
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86,750
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|
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76,355
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Deferred tax assets
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13,881
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13,881
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|
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Prepaid expenses and other current assets
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10,598
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|
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9,577
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Total current assets
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502,640
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756,375
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|
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Fixed assets, net
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30,053
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16,100
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Intangible assets, net
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462,486
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119,576
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Goodwill
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135,627
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14,671
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|
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Restricted cash
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1,558
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1,571
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|
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Deferred tax assets, net
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—
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46,625
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|
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Other assets
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17,559
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|
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17,264
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|
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Total assets
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$
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1,149,923
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|
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$
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972,182
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LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
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|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
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$
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5,067
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|
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$
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25,378
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Accrued expenses
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113,235
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|
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107,453
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|
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Deferred revenue
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2,319
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|
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2,375
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|
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Total current liabilities
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120,621
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|
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135,206
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|
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Contingent purchase price
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100,524
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|
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18,971
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|
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Deferred tax liabilities
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34,504
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|
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—
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|
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Convertible senior notes (due 2017)
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231,025
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226,109
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|
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Other liabilities
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5,815
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5,674
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|
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Total liabilities
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492,489
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385,960
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Stockholders' equity:
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|
|
|
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Preferred stock, $1.00 par value per share, 5,000,000 shares authorized; no shares issued and outstanding
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—
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|
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—
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Common stock, $0.001 par value per share, 125,000,000 shares authorized; 58,797,762 issued and 56,604,780 outstanding at June 30, 2013 and 56,153,140 issued and 53,960,158 outstanding at December 31, 2012, respectively
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58
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|
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56
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|
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Additional paid-in capital
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763,127
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697,427
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|
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Treasury stock, at cost; 2,192,982 shares at June 30, 2013 and December 31, 2012, respectively
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(50,000
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)
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(50,000
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)
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Accumulated deficit
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(53,890
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)
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(60,411
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)
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Accumulated other comprehensive loss
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(1,684
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)
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(766
|
)
|
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Total The Medicines Company stockholders' equity
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657,611
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|
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586,306
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|
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Non-controlling interest in joint venture
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(177
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)
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(84
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)
|
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Total stockholders' equity
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657,434
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|
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586,222
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|
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Total liabilities and stockholders' equity
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$
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1,149,923
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$
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972,182
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Three Months Ended June 30,
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Six Months Ended June 30,
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||||||||||||
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2013
|
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2012
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2013
|
|
2012
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||||||||
Net revenue
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$
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172,826
|
|
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$
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135,702
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|
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$
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328,579
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$
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262,312
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Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
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63,938
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|
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42,681
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|
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120,653
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|
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81,344
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|
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Research and development
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27,025
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|
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32,962
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|
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85,221
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|
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65,740
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|
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Selling, general and administrative
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52,944
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40,467
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|
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116,426
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|
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83,653
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|
||||
Total operating expenses
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143,907
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|
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116,110
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|
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322,300
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|
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230,737
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|
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Income from operations
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28,919
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|
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19,592
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|
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6,279
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|
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31,575
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|
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Co-promotion income
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4,068
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|
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2,500
|
|
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7,818
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|
|
2,500
|
|
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Interest expense
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(3,704
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)
|
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(784
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)
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(7,377
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)
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(784
|
)
|
||||
Other income
|
605
|
|
|
697
|
|
|
803
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|
|
759
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|
||||
Income before income taxes
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29,888
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|
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22,005
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|
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7,523
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|
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34,050
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|
||||
Provision for income taxes
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(11,854
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)
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(8,251
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)
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(1,095
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)
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(12,725
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)
|
||||
Net income
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18,034
|
|
|
13,754
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|
|
6,428
|
|
|
21,325
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|
||||
Net loss attributable to non-controlling interest
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60
|
|
|
1
|
|
|
93
|
|
|
1
|
|
||||
Net income attributable to The Medicines Company
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$
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18,094
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|
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$
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13,755
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$
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6,521
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|
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$
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21,326
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Basic earnings per common share attributable to The Medicines Company
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$
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0.33
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$
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0.25
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$
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0.12
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$
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0.39
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Diluted earnings per common share attributable to The Medicines Company
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$
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0.30
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$
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0.25
|
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$
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0.11
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|
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$
|
0.38
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Weighted average number of common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
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55,553
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|
|
54,035
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|
|
54,804
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|
|
54,036
|
|
||||
Diluted
|
60,261
|
|
|
55,556
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|
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59,154
|
|
|
55,614
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|
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Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
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2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Net income
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$
|
18,034
|
|
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$
|
13,754
|
|
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$
|
6,428
|
|
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$
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21,325
|
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Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
||||||||
Unrealized (loss) gain on available for sale securities
|
(10
|
)
|
|
66
|
|
|
(5
|
)
|
|
(23
|
)
|
||||
Foreign currency translation adjustment
|
(672
|
)
|
|
(936
|
)
|
|
(913
|
)
|
|
(634
|
)
|
||||
Other comprehensive (loss)
|
(682
|
)
|
|
(870
|
)
|
|
(918
|
)
|
|
(657
|
)
|
||||
Comprehensive income
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$
|
17,352
|
|
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$
|
12,884
|
|
|
5,510
|
|
|
20,668
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|
|
Six Months Ended June 30,
|
||||||
|
2013
|
|
2012
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
6,428
|
|
|
$
|
21,325
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
12,815
|
|
|
3,686
|
|
||
Amortization of net premiums and discounts on available for sale securities
|
203
|
|
|
279
|
|
||
Amortization of long term debt financing costs
|
572
|
|
|
58
|
|
||
Amortization of debt discount
|
4,915
|
|
|
519
|
|
||
Unrealized foreign currency transaction loss (gain), net
|
49
|
|
|
(201
|
)
|
||
Non-cash stock compensation expense
|
10,460
|
|
|
7,295
|
|
||
Loss on disposal of fixed assets
|
26
|
|
|
28
|
|
||
Deferred tax provision
|
(2,631
|
)
|
|
4,133
|
|
||
Excess tax benefit from share-based compensation arrangements
|
(5,682
|
)
|
|
(239
|
)
|
||
Adjustment to contingent purchase price
|
(5,648
|
)
|
|
1,137
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accrued interest receivable
|
273
|
|
|
74
|
|
||
Accounts receivable
|
(4,729
|
)
|
|
8,725
|
|
||
Inventory
|
(10,482
|
)
|
|
(2,085
|
)
|
||
Prepaid expenses and other current assets
|
(739
|
)
|
|
(950
|
)
|
||
Accounts payable
|
(20,185
|
)
|
|
780
|
|
||
Accrued expenses
|
6,668
|
|
|
(40,006
|
)
|
||
Deferred revenue
|
(29
|
)
|
|
1,401
|
|
||
Other liabilities
|
133
|
|
|
89
|
|
||
Net cash (used in) provided by operating activities
|
(7,583
|
)
|
|
6,048
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Purchases of available for sale securities
|
—
|
|
|
(65,354
|
)
|
||
Proceeds from maturities and sales of available for sale securities
|
42,556
|
|
|
25,036
|
|
||
Purchases of fixed assets
|
(3,159
|
)
|
|
(488
|
)
|
||
Acquisitions, net of cash acquired
|
(301,700
|
)
|
|
|
|||
Acquisition of intangible assets
|
(10,000
|
)
|
|
(36,678
|
)
|
||
Other investments
|
(875
|
)
|
|
—
|
|
||
Decrease in restricted cash
|
7
|
|
|
2,008
|
|
||
Net cash used in investing activities
|
(273,171
|
)
|
|
(75,476
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from issuances of common stock
|
49,561
|
|
|
10,073
|
|
||
Purchase of treasury stock
|
|
|
(50,000
|
)
|
|||
Proceeds from issuance of convertible senior notes
|
|
|
275,000
|
|
|||
Proceeds from issuance of warrants
|
|
|
38,425
|
|
|||
Purchase of convertible note hedge
|
|
|
(58,223
|
)
|
|||
Debt issuance costs
|
|
|
(8,774
|
)
|
|||
Excess tax benefit from stock-based compensation arrangements
|
5,682
|
|
|
239
|
|
||
Net cash provided by financing activities
|
55,243
|
|
|
206,740
|
|
||
Effect of exchange rate changes on cash
|
(1,044
|
)
|
|
(354
|
)
|
||
(Decrease) increase in cash and cash equivalents
|
(226,555
|
)
|
|
136,958
|
|
||
Cash and cash equivalents at beginning of period
|
519,446
|
|
|
315,382
|
|
||
Cash and cash equivalents at end of period
|
$
|
292,891
|
|
|
$
|
452,340
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
||||
Interest paid
|
$
|
1,891
|
|
|
$
|
—
|
|
Taxes paid
|
$
|
1,100
|
|
|
$
|
1,019
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
(in thousands, except per share amounts)
|
|
|
|
|
||||||||||
Basic and diluted
|
|
|
|
|
|
|
|
||||||||
Net income attributable to The Medicines Company
|
$
|
18,094
|
|
|
$
|
13,755
|
|
|
$
|
6,521
|
|
|
$
|
21,326
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding, basic
|
55,553
|
|
|
54,035
|
|
|
54,804
|
|
|
54,036
|
|
||||
Plus: net effect of dilutive stock options, restricted common shares and shares issuable upon conversion of Notes
|
4,708
|
|
|
1,521
|
|
|
4,350
|
|
|
1,578
|
|
||||
Weighted average common shares outstanding, diluted
|
60,261
|
|
|
55,556
|
|
|
59,154
|
|
|
55,614
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings per share attributable to The Medicines Company, basic
|
$
|
0.33
|
|
|
$
|
0.25
|
|
|
$
|
0.12
|
|
|
$
|
0.39
|
|
Earnings per share attributable to The Medicines Company, diluted
|
$
|
0.30
|
|
|
$
|
0.25
|
|
|
$
|
0.11
|
|
|
$
|
0.38
|
|
|
As of June 30, 2013
|
|
As of December 31, 2012
|
||||||||||||||||||||||||||||
|
Cost
|
|
Fair Value
|
|
Carrying
Value
|
|
Unrealized
Gain
|
|
Cost
|
|
Fair Value
|
|
Carrying
Value
|
|
Unrealized
Gain
|
||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||||||
U.S. government agency notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,093
|
|
|
$
|
7,097
|
|
|
$
|
7,097
|
|
|
$
|
4
|
|
Corporate debt securities
|
8,107
|
|
|
8,112
|
|
|
8,112
|
|
|
5
|
|
|
43,772
|
|
|
43,778
|
|
|
43,778
|
|
|
6
|
|
||||||||
Total
|
$
|
8,107
|
|
|
$
|
8,112
|
|
|
$
|
8,112
|
|
|
$
|
5
|
|
|
$
|
50,865
|
|
|
$
|
50,875
|
|
|
$
|
50,875
|
|
|
$
|
10
|
|
Level 1
|
Quoted prices in active markets for identical assets or liabilities. The Company's Level 1 assets and liabilities consist of money market investments and U.S. treasury notes.
|
Level 2
|
Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company's Level 2 assets and liabilities consist of U.S. government agency notes and corporate debt securities. Fair values are determined by utilizing quoted prices for similar assets and liabilities in active markets or other market observable inputs such as interest rates and yield curves.
|
Level 3
|
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company's Level 3 assets and liabilities consist of the contingent purchase prices associated with the Company's acquisitions of Targanta and Incline. The fair value of the contingent purchase prices was determined utilizing a probability weighted discounted financial model based on management's assessment of the likelihood of achievement of certain development, regulatory and sales milestones.
|
|
As of June 30, 2013
|
|
As of December 31, 2012
|
||||||||||||||||||||||||||||
Assets and Liabilities
|
Quoted Prices In
Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Balance as of June 30, 2013
|
|
Quoted Prices In
Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Balance as of December 31, 2012
|
||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market
|
$
|
37,831
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37,831
|
|
|
$
|
14,751
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,751
|
|
U.S. government agency notes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,097
|
|
|
—
|
|
|
7,097
|
|
||||||||
Corporate debt securities
|
—
|
|
|
8,112
|
|
|
—
|
|
|
8,112
|
|
|
—
|
|
|
43,778
|
|
|
—
|
|
|
43,778
|
|
||||||||
Total assets at fair value
|
$
|
37,831
|
|
|
$
|
8,112
|
|
|
$
|
—
|
|
|
$
|
45,943
|
|
|
$
|
14,751
|
|
|
$
|
50,875
|
|
|
$
|
—
|
|
|
$
|
65,626
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Contingent purchase price
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
100,524
|
|
|
$
|
100,524
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18,971
|
|
|
$
|
18,971
|
|
Total liabilities at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
100,524
|
|
|
$
|
100,524
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18,971
|
|
|
$
|
18,971
|
|
|
||||||||||
|
|
Fair Value as of
|
|
|
|
|
|
|
||
|
|
June 30, 2013
|
|
Valuation Technique
|
|
Unobservable Input
|
|
Range
(Weighted Average)
|
||
|
|
(in thousands)
|
|
|
|
|
|
|
||
Targanta:
|
|
|
|
|
|
|
|
|
||
Contingent purchase price
|
|
$
|
5,424
|
|
|
Probability-adjusted discounted cash flow
|
|
Probability of success
|
|
20%
|
|
|
|
|
|
|
Period in which milestone is expected to be achieved
|
|
2019
|
||
|
|
|
|
|
|
Discount rate
|
|
11%
|
||
Incline:
|
|
|
|
|
|
|
|
|
||
Contingent purchase price
|
|
$
|
95,100
|
|
|
Probability-adjusted discounted cash flow
|
|
Probabilities of success
|
|
60% - 80% (75%)
|
|
|
|
|
|
|
Periods in which milestones are expected to be achieved
|
|
2013-2017
|
||
|
|
|
|
|
|
Discount Rate
|
|
22%
|
|
|
Fair Value as of
|
|
|
|
|
|
|
||
|
|
December 31, 2012
|
|
Valuation Technique
|
|
Unobservable Input
|
|
Range
(Weighted Average)
|
||
|
|
(in thousands)
|
|
|
|
|
|
|
||
Targanta:
|
|
|
|
|
|
|
|
|
||
Contingent purchase price
|
|
$
|
18,971
|
|
|
Probability-adjusted discounted cash flow
|
|
Probabilities of success
|
|
20% - 60% (49%)
|
|
|
|
|
|
|
Periods in which milestones are expected to be achieved
|
|
2013 - 2019
|
||
|
|
|
|
|
|
Discount rate
|
|
11%
|
|
||||||||||||||||
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
|
(in thousands)
|
|
|
|
|
||||||||||
Balance at beginning of period
|
|
$
|
105,807
|
|
|
$
|
20,995
|
|
|
$
|
18,971
|
|
|
$
|
20,431
|
|
Fair value of contingent purchase price with respect to Incline as of January 4, 2013
|
|
—
|
|
|
—
|
|
|
87,200
|
|
|
—
|
|
||||
Fair value adjustment to contingent purchase prices included in net income
|
|
(5,283
|
)
|
|
573
|
|
|
(5,647
|
)
|
|
1,137
|
|
||||
Balance at end of period
|
|
$
|
100,524
|
|
|
$
|
21,568
|
|
|
$
|
100,524
|
|
|
$
|
21,568
|
|
Inventory
|
|
June 30,
2013 |
|
December 31,
2012 |
||||
|
|
(in thousands)
|
||||||
Raw materials
|
|
$
|
43,821
|
|
|
$
|
40,244
|
|
Work-in-progress
|
|
22,536
|
|
|
26,594
|
|
||
Finished goods
|
|
20,393
|
|
|
9,517
|
|
||
Total
|
|
$
|
86,750
|
|
|
$
|
76,355
|
|
|
As of June 30, 2013
|
|
As of December 31, 2012
|
||||||||||||||||||||||
|
Weighted Average
Useful Life
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
|
|
|
(in thousands)
|
||||||||||||||||||||||
Identifiable intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships
|
8 years
|
|
$
|
7,457
|
|
|
$
|
(4,868
|
)
|
|
$
|
2,589
|
|
|
$
|
7,457
|
|
|
$
|
(4,106
|
)
|
|
$
|
3,351
|
|
Distribution agreements
|
5.7 years
|
|
9,125
|
|
|
(4,669
|
)
|
|
4,456
|
|
|
9,125
|
|
|
(3,469
|
)
|
|
5,656
|
|
||||||
Trademarks
|
8 years
|
|
3,024
|
|
|
(1,974
|
)
|
|
1,050
|
|
|
3,024
|
|
|
(1,665
|
)
|
|
1,359
|
|
||||||
Product licenses
|
5.7 years
|
|
71,000
|
|
|
(9,932
|
)
|
|
61,068
|
|
|
39,000
|
|
|
(1,129
|
)
|
|
37,871
|
|
||||||
Cleviprex milestones
|
13 years
|
|
2,000
|
|
|
(177
|
)
|
|
1,823
|
|
|
2,000
|
|
|
(161
|
)
|
|
1,839
|
|
||||||
Total
|
6.1 years
|
|
$
|
92,606
|
|
|
$
|
(21,620
|
)
|
|
$
|
70,986
|
|
|
$
|
60,606
|
|
|
$
|
(10,530
|
)
|
|
$
|
50,076
|
|
|
As of June 30, 2013
|
|
As of December 31, 2012
|
||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Adjustments
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Adjustments
|
|
Net
Carrying
Amount
|
||||||||||
|
(in thousands)
|
||||||||||||||||||||
Intangible assets not subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
In-process research and development
|
$
|
319,500
|
|
|
—
|
|
|
$
|
319,500
|
|
|
$
|
69,500
|
|
|
—
|
|
|
$
|
69,500
|
|
Recothrom option
|
62,000
|
|
|
—
|
|
|
62,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
ProFibrix option
|
10,000
|
|
|
—
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
391,500
|
|
|
—
|
|
|
$
|
391,500
|
|
|
$
|
69,500
|
|
|
—
|
|
|
$
|
69,500
|
|
|
June 30, 2013
|
|
|
||
|
(in thousands)
|
|
|||
Balance at January 1, 2013
|
$
|
14,671
|
|
|
|
Goodwill resulting from the acquisition of Incline
|
99,956
|
|
|
|
|
Goodwill resulting from the acquisition of Recothrom
|
21,000
|
|
|
|
|
Balance as of June 30, 2013
|
$
|
135,627
|
|
|
|
•
|
during any calendar quarter commencing on or after
September 1, 2012
(and only during such calendar quarter), if the last reported sale price of the Company's common stock for at least
20
trading days (whether or not consecutive) during a period of
30
consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to
130%
of the conversion price (described below) on each applicable trading day;
|
•
|
during the five business day period after any
five
consecutive trading day period (the Measurement Period) in which the trading price (as defined in the Indenture) per
$1,000
principal amount of Notes for each trading day of the Measurement Period was less than
98%
of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day; or
|
•
|
upon the occurrence of specified corporate events, including a merger or a sale of all or substantially all of the Company's assets.
|
Liability component
|
|
June 30, 2013
|
|
December 31, 2012
|
||||
|
|
(in thousands)
|
||||||
Principal
|
|
$
|
275,000
|
|
|
$
|
275,000
|
|
Less: Debt discount, net
(1)
|
|
(43,975
|
)
|
|
(48,891
|
)
|
||
Net carrying amount
|
|
$
|
231,025
|
|
|
$
|
226,109
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
(in thousands)
|
|
|
|
|
||||||||||
Contractual interest expense
|
$
|
945
|
|
|
$
|
207
|
|
|
$
|
1,891
|
|
|
$
|
207
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of debt issuance costs
|
289
|
|
|
58
|
|
|
572
|
|
|
58
|
|
||||
Amortization of debt discount
|
2,470
|
|
|
519
|
|
|
4,915
|
|
|
519
|
|
||||
Total
|
$
|
3,704
|
|
|
$
|
784
|
|
|
$
|
7,378
|
|
|
$
|
784
|
|
Effective interest rate of the liability component
|
6.02
|
%
|
|
6.02
|
%
|
|
6.02
|
%
|
|
6.02
|
%
|
|
Balance as of December 31, 2012
|
|
Expenses, Net
|
|
Cash
|
|
Noncash
|
|
Balance as of June 30, 2013
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
2011 Leipzig closure other associated costs
|
$
|
1,009
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,009
|
)
|
|
$
|
—
|
|
Employee severance and other personnel benefits:
|
|
|
|
|
|
|
|
|
|
||||||||||
2013 workforce reduction
|
—
|
|
|
6,358
|
|
|
(5,483
|
)
|
|
(256
|
)
|
|
619
|
|
|||||
Total
|
$
|
1,009
|
|
|
$
|
6,358
|
|
|
$
|
(5,483
|
)
|
|
$
|
(1,265
|
)
|
|
$
|
619
|
|
|
|
(in thousands)
|
||
Upfront cash consideration
|
|
$
|
186,699
|
|
Fair value of contingent purchase price
|
|
87,200
|
|
|
Total preliminary estimated purchase price
|
|
$
|
273,899
|
|
|
|
|
|
|
|
||
Assets Acquired:
|
|
(in thousands)
|
||
Cash and cash equivalents
|
|
$
|
1,563
|
|
Prepaid expenses and other current assets
|
|
624
|
|
|
Fixed assets, net
|
|
12,577
|
|
|
In-process research and development
|
|
250,000
|
|
|
Goodwill
|
|
99,956
|
|
|
Other assets
|
|
34
|
|
|
Total Assets
|
|
$
|
364,754
|
|
Liabilities Assumed:
|
|
|
||
Accrued expenses
|
|
1,413
|
|
|
Contingent purchase price
|
|
87,200
|
|
|
Deferred tax liabilities
|
|
89,442
|
|
|
Total Liabilities
|
|
178,055
|
|
|
|
|
|
||
Total cash price paid upon acquisition
|
|
$
|
186,699
|
|
•
|
a multiple of average net sales over each of the
two
12
-month periods preceding the closing of the purchase (unless the purchase closing occurs less than 24 months after February 8, 2013, in which case the measurement period would be the 12-month period preceding the purchase closing); or
|
•
|
if BMS has delivered a valid notice terminating the collaboration term early as a result of a material breach by the Company under the master transaction agreement, the amount described above plus an amount intended to give BMS the economic benefit of having received royalty fees for a
24
-month collaboration term.
|
|
|
|
||
Assets Acquired:
|
|
(in thousands)
|
||
Product license
|
|
$
|
32,000
|
|
Option
|
|
62,000
|
|
|
Goodwill
|
|
21,000
|
|
|
Total Assets
|
|
$
|
115,000
|
|
Total cash price paid upon acquisition
|
|
$
|
115,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||
Net revenue
|
|
$
|
172,826
|
|
|
$
|
152,314
|
|
|
$
|
334,932
|
|
|
$
|
295,536
|
|
Net (loss) income
|
|
$
|
18,094
|
|
|
$
|
(65,162
|
)
|
|
$
|
5,531
|
|
|
$
|
(61,583
|
)
|
Basic earnings (loss) per common share
|
|
$
|
0.33
|
|
|
$
|
(1.21
|
)
|
|
$
|
0.10
|
|
|
$
|
(1.14
|
)
|
Diluted earnings (loss) per common share
|
|
$
|
0.30
|
|
|
$
|
(1.21
|
)
|
|
$
|
0.09
|
|
|
$
|
(1.14
|
)
|
|
|
|
||||||||||
|
|
Foreign currency translation adjustment
|
|
Unrealized gain on available for sale securities
|
|
Total
|
||||||
|
|
(in thousands)
|
||||||||||
Balance at December 31, 2012
|
|
$
|
(825
|
)
|
|
$
|
59
|
|
|
$
|
(766
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(913
|
)
|
|
(5
|
)
|
|
(918
|
)
|
|||
Amounts reclassified from accumulated other comprehensive income*
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total other comprehensive (loss) income
|
|
(913
|
)
|
|
(5
|
)
|
|
(918
|
)
|
|||
Balance at June 30, 2013
|
|
$
|
(1,738
|
)
|
|
$
|
54
|
|
|
$
|
(1,684
|
)
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
||||||||||||||||
|
2013
|
|
|
|
2012
|
|
|
2013
|
|
|
|
2012
|
|
||||||||
|
(in thousands)
|
|
|
|
|
(in thousands)
|
|
||||||||||||||
Net revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
159,590
|
|
|
92.3%
|
|
$
|
123,774
|
|
91.2%
|
|
$
|
303,786
|
|
|
92.5%
|
|
$
|
239,753
|
|
91.4%
|
Europe
|
10,698
|
|
|
6.2%
|
|
9,656
|
|
7.1%
|
|
21,083
|
|
|
6.4%
|
|
18,812
|
|
7.2%
|
||||
Rest of world
|
2,538
|
|
|
1.5%
|
|
2,272
|
|
1.7%
|
|
3,710
|
|
|
1.1%
|
|
3,747
|
|
1.4%
|
||||
Total net revenue
|
$
|
172,826
|
|
|
100.0%
|
|
$
|
135,702
|
|
100.0%
|
|
$
|
328,579
|
|
|
100.0%
|
|
$
|
262,312
|
|
100.0%
|
|
June 30,
2013 |
|
|
|
December 31,
2012 |
|
||||||
|
(in thousands)
|
|
||||||||||
Long-lived assets:
|
|
|
|
|
|
|
||||||
United States
|
$
|
643,700
|
|
|
99.7
|
%
|
|
$
|
161,909
|
|
99.4
|
%
|
Europe
|
1,124
|
|
|
0.2
|
%
|
|
743
|
|
0.5
|
%
|
||
Rest of world
|
901
|
|
|
0.1
|
%
|
|
148
|
|
0.1
|
%
|
||
Total long-lived assets
|
$
|
645,725
|
|
|
100.0
|
%
|
|
$
|
162,800
|
|
100.0
|
%
|
Product or Product
in Development
|
|
Development Stage
|
|
Mechanism/Target
|
|
Clinical Indication(s)/Therapeutic Areas
|
Marketed Products
|
|
|
|
|
|
|
Angiomax
|
|
Marketed
|
|
Direct thrombin inhibitor
|
|
U.S. - for use as an anticoagulant in combination with aspirin in patients with unstable angina undergoing percutaneous transluminal coronary angioplasty, or PTCA, and for use in patients undergoing percutaneous coronary intervention, or PCI, including patients with or at risk of heparin induced thrombocytopenia and thrombosis syndrome, or HIT/HITTS
|
|
|
|
|
|
|
Europe - for use as an anticoagulant in patients undergoing PCI, adult patients with acute coronary syndrome, or ACS, and for the treatment of patients with ST-segment elevation myocardial infarction, or STEMI, undergoing primary PCI
|
Recothrom
|
|
Marketed in the United States and Canada
|
|
Recombinant human thrombin
|
|
For use as an aid to hemostasis to help control oozing blood and mild bleeding during surgical procedures
|
Cleviprex
|
|
Marketed in the United States
Approved in Australia, Austria, Canada, France, Germany, the Netherlands, Switzerland and the United Kingdom
Marketing Authorization Application, or MAA, submitted for other European Union countries
|
|
Calcium channel blocker
|
|
U.S. - Blood pressure reduction when oral therapy is not feasible or not desirable
Ex-U.S. - with indications for blood pressure control in perioperative settings
|
Ready-to-use Argatroban
|
|
Marketed in the United States
|
|
Direct thrombin inhibitor
|
|
Approved for prophylaxis or treatment of thrombosis in adult patients with HIT and for use as an anticoagulant in adult patients with or at risk for HIT undergoing PCI
|
Acute care generic products: Midazolam, Ondansetron and Rocuronium
|
|
Marketed in the United States
|
|
Various
|
|
Neurocritical care
|
Acute care generic products:
Adenosine, Amiodarone, Esmolol and Milrinone
|
|
Approved in the United States
|
|
Various
|
|
Cardiovascular
|
Acute care generic products: Azithromycin and Clindamycin
|
|
Approved in the United States
|
|
Various
|
|
Serious infection
|
Acute care generic products: Haloperidol
|
|
Approved in the United States
|
|
Various
|
|
Neurocritical care
|
Products in Development
|
|
|
|
|
|
|
Cangrelor
|
|
New Drug Application, or NDA, filed in the United States; MAA submission in the European Union planned for the fourth quarter of 2013
|
|
Antiplatelet agent
|
|
Prevention of platelet activation and aggregation when oral therapy is not feasible or not desirable for use in patients undergoing PCI and patients that require bridging from oral antiplatelet therapy to surgery
|
Oritavancin
|
|
Phase 3 completed; NDA submission in the United States planned for the fourth quarter of 2013; MAA submission in the European Union planned for the first half of 2014
|
|
Antibiotic
|
|
Treatment of serious gram-positive bacterial infections, including acute bacterial skin and skin structure infections, or ABSSSI, and including infections that are resistant to conventional treatment
|
Fibrocaps
|
|
Phase 3 completed; Biologics License Application, or BLA, submission in the United States planned for the first quarter of 2014; MAA submission in the European Union planned for the fourth quarter of 2014
|
|
Dry powder topical formulation of fibrinogen and thrombin
|
|
For use as an aid to stop bleeding during surgery
|
IONSYS
|
|
Pre-registration stage; Supplemental New Drug Application, or sNDA, submission planned for first quarter of 2014; MAA submission in European Union planned for second quarter of 2014
|
|
Patient-controlled analgesia system
|
|
Short-term management of acute postoperative pain
|
MDCO-216
|
|
Phase 1
|
|
Naturally occurring variant of a protein found in high-density lipoprotein, or HDL
|
|
Reversal cholesterol transport agent to reduce atherosclerotic plaque burden development and thereby reduce the risk of adverse thrombotic events
|
ALN-PCS program: ALN-PCS02 and ALN-PCSsc
|
|
Phase 1
|
|
PCSK-9 gene antagonist addressing low-density lipoprotein, or LDL, cholesterol disease modification
|
|
Treatment of hypercholesterolemia
|
•
|
a multiple of average net sales over each of the two 12-month periods preceding the closing of the purchase of the assets to be acquired in connection with exercising the option (unless such closing occurs less than 24 months after February 8, 2013, in which case the measurement period would be the 12-month period preceding such closing); or
|
•
|
if BMS has delivered a valid notice terminating the collaboration term early as a result of a material breach by us under the master transaction agreement, the amount described above plus an amount intended to give BMS the economic benefit of having received royalty fees for a 24-month collaboration term.
|
|
Three Months Ended June 30,
|
|||||||||||||
|
2013
|
|
2012
|
|
Change
$
|
|
Change
%
|
|||||||
|
|
|
(in thousands)
|
|
|
|
|
|||||||
Angiomax
|
$
|
151,159
|
|
|
$
|
133,101
|
|
|
$
|
18,058
|
|
|
13.6
|
%
|
Recothrom
|
17,925
|
|
|
—
|
|
|
17,925
|
|
|
100.0
|
%
|
|||
Cleviprex/Ready-to-Use Argatroban
|
3,742
|
|
|
2,601
|
|
|
1,141
|
|
|
43.9
|
%
|
|||
Total net revenue
|
$
|
172,826
|
|
|
$
|
135,702
|
|
|
$
|
37,124
|
|
|
27.4
|
%
|
|
|
|
|
|
|
|
|
|||||||
|
Six Months Ended June 30,
|
|||||||||||||
|
2013
|
|
2012
|
|
Change
$
|
|
Change
%
|
|||||||
|
|
|
(in thousands)
|
|
|
|
|
|||||||
Angiomax
|
$
|
294,045
|
|
|
$
|
259,210
|
|
|
$
|
34,835
|
|
|
13.4
|
%
|
Recothrom
|
26,547
|
|
|
—
|
|
|
26,547
|
|
|
100.0
|
%
|
|||
Cleviprex/Ready-to-Use Argatroban
|
7,987
|
|
|
3,102
|
|
|
4,885
|
|
|
157.5
|
%
|
|||
Total net revenue
|
$
|
328,579
|
|
|
$
|
262,312
|
|
|
$
|
66,267
|
|
|
25.3
|
%
|
•
|
expenses in connection with the manufacture of our products sold;
|
•
|
royalty expenses under our agreements with Biogen and Health Research Inc., or HRI, related to Angiomax, our agreement with AstraZeneca related to Cleviprex, our agreement with Eagle related to ready-to-use Argatroban;
|
•
|
amortization of the costs of license agreements, product rights and other identifiable intangible assets, which result from product and business acquisitions; and
|
•
|
logistics costs related to Angiomax, Cleviprex and ready-to-use Argatroban, including distribution, storage, and handling costs.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2013
|
|
% of Total
|
|
2012
|
|
% of Total
|
|
2013
|
|
% of Total
|
|
2012
|
|
% of Total
|
||||||||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||||||
Manufacturing/Logistics
|
$
|
19,791
|
|
|
31
|
%
|
|
$
|
12,076
|
|
|
28
|
%
|
|
$
|
38,442
|
|
|
32
|
%
|
|
$
|
23,181
|
|
|
28
|
%
|
Royalty
|
39,146
|
|
|
61
|
%
|
|
30,379
|
|
|
71
|
%
|
|
$
|
73,408
|
|
|
61
|
%
|
|
$
|
57,711
|
|
|
71
|
%
|
||
Amortization of product rights and intangible assets
|
5,001
|
|
|
8
|
%
|
|
226
|
|
|
1
|
%
|
|
$
|
8,803
|
|
|
7
|
%
|
|
$
|
452
|
|
|
1
|
%
|
||
Total cost of revenue
|
$
|
63,938
|
|
|
100
|
%
|
|
$
|
42,681
|
|
|
100
|
%
|
|
$
|
120,653
|
|
|
100
|
%
|
|
$
|
81,344
|
|
|
100
|
%
|
|
Three Months Ended June 30,
|
||||||||||||
|
2013
|
|
% of
Total R&D
|
|
2012
|
|
% of
Total R&D
|
||||||
|
(In thousands)
|
|
|
|
(In thousands)
|
|
|
||||||
Angiomax
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
$
|
3,717
|
|
|
14
|
%
|
|
$
|
900
|
|
|
3
|
%
|
Manufacturing development
|
3
|
|
|
—
|
%
|
|
17
|
|
|
—
|
%
|
||
Administrative and headcount costs
|
2,091
|
|
|
8
|
%
|
|
660
|
|
|
2
|
%
|
||
Total Angiomax
|
5,811
|
|
|
22
|
%
|
|
1,577
|
|
|
5
|
%
|
||
Cleviprex
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
—
|
|
|
—
|
%
|
|
193
|
|
|
1
|
%
|
||
Manufacturing development
|
274
|
|
|
1
|
%
|
|
506
|
|
|
2
|
%
|
||
Administrative and headcount costs
|
647
|
|
|
2
|
%
|
|
384
|
|
|
1
|
%
|
||
Total Cleviprex
|
921
|
|
|
3
|
%
|
|
1,083
|
|
|
4
|
%
|
||
Cangrelor
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
983
|
|
|
4
|
%
|
|
10,646
|
|
|
32
|
%
|
||
Manufacturing development
|
968
|
|
|
4
|
%
|
|
562
|
|
|
2
|
%
|
||
Administrative and headcount costs
|
4,488
|
|
|
17
|
%
|
|
1,543
|
|
|
5
|
%
|
||
Total Cangrelor
|
6,439
|
|
|
25
|
%
|
|
12,751
|
|
|
39
|
%
|
||
Oritavancin
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
1,308
|
|
|
5
|
%
|
|
7,840
|
|
|
24
|
%
|
||
Manufacturing development
|
960
|
|
|
4
|
%
|
|
1,901
|
|
|
6
|
%
|
||
Administrative and headcount costs
|
3,134
|
|
|
12
|
%
|
|
1,103
|
|
|
3
|
%
|
||
Total Oritavancin
|
5,402
|
|
|
21
|
%
|
|
10,844
|
|
|
33
|
%
|
||
MDCO-157
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
23
|
|
|
—
|
%
|
|
68
|
|
|
—
|
%
|
||
Manufacturing development
|
167
|
|
|
1
|
%
|
|
256
|
|
|
1
|
%
|
||
Administrative and headcount costs
|
321
|
|
|
1
|
%
|
|
552
|
|
|
2
|
%
|
||
Total MDCO-157
|
511
|
|
|
2
|
%
|
|
876
|
|
|
3
|
%
|
||
MDCO-2010
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
|
|
—
|
%
|
|
290
|
|
|
1
|
%
|
|||
Manufacturing development
|
—
|
|
|
—
|
%
|
|
404
|
|
|
1
|
%
|
||
Administrative and headcount costs
|
|
|
—
|
%
|
|
700
|
|
|
2
|
%
|
|||
Total MDCO-2010
|
—
|
|
|
—
|
%
|
|
1,394
|
|
|
4
|
%
|
||
MDCO-216
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
373
|
|
|
1
|
%
|
|
294
|
|
|
1
|
%
|
||
Manufacturing development
|
710
|
|
|
3
|
%
|
|
368
|
|
|
1
|
%
|
||
Administrative and headcount costs
|
981
|
|
|
4
|
%
|
|
372
|
|
|
1
|
%
|
||
Total MDCO-216
|
2,064
|
|
|
8
|
%
|
|
1,034
|
|
|
3
|
%
|
||
IONSYS
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
114
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
||
Manufacturing development
|
2,268
|
|
|
8
|
%
|
|
—
|
|
|
—
|
%
|
||
Administrative and headcount costs
|
2,204
|
|
|
8
|
%
|
|
—
|
|
|
—
|
%
|
||
Total IONSYS
|
4,586
|
|
|
16
|
%
|
|
—
|
|
|
—
|
%
|
||
Other
|
1,291
|
|
|
3
|
%
|
|
3,403
|
|
|
10
|
%
|
||
Total
|
$
|
27,025
|
|
|
100
|
%
|
|
$
|
32,962
|
|
|
100
|
%
|
|
Six Months Ended June 30,
|
||||||||||||
|
2013
|
|
% of
Total R&D
|
|
2012
|
|
% of
Total R&D
|
||||||
|
(In thousands)
|
|
|
|
(In thousands)
|
|
|
||||||
Angiomax
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
$
|
5,381
|
|
|
6
|
%
|
|
$
|
2,480
|
|
|
4
|
%
|
Manufacturing development
|
9
|
|
|
—
|
%
|
|
56
|
|
|
—
|
%
|
||
Administrative and headcount costs
|
3,606
|
|
|
5
|
%
|
|
1,045
|
|
|
1
|
%
|
||
Total Angiomax
|
8,996
|
|
|
11
|
%
|
|
3,581
|
|
|
5
|
%
|
||
Cleviprex
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
—
|
|
|
—
|
%
|
|
188
|
|
|
—
|
%
|
||
Manufacturing development
|
311
|
|
|
—
|
%
|
|
687
|
|
|
1
|
%
|
||
Administrative and headcount costs
|
1,320
|
|
|
2
|
%
|
|
730
|
|
|
1
|
%
|
||
Total Cleviprex
|
1,631
|
|
|
2
|
%
|
|
1,605
|
|
|
2
|
%
|
||
Cangrelor
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
2,132
|
|
|
3
|
%
|
|
23,079
|
|
|
35
|
%
|
||
Manufacturing development
|
1,914
|
|
|
2
|
%
|
|
1,180
|
|
|
2
|
%
|
||
Administrative and headcount costs
|
7,858
|
|
|
9
|
%
|
|
3,002
|
|
|
4
|
%
|
||
Total Cangrelor
|
11,904
|
|
|
14
|
%
|
|
27,261
|
|
|
41
|
%
|
||
Oritavancin
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
9,474
|
|
|
11
|
%
|
|
15,478
|
|
|
23
|
%
|
||
Manufacturing development
|
4,107
|
|
|
5
|
%
|
|
1,957
|
|
|
3
|
%
|
||
Administrative and headcount costs
|
5,586
|
|
|
7
|
%
|
|
2,393
|
|
|
4
|
%
|
||
Total Oritavancin
|
19,167
|
|
|
23
|
%
|
|
19,828
|
|
|
30
|
%
|
||
MDCO-157
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
406
|
|
|
—
|
%
|
|
100
|
|
|
—
|
%
|
||
Manufacturing development
|
248
|
|
|
—
|
%
|
|
413
|
|
|
1
|
%
|
||
Administrative and headcount costs
|
646
|
|
|
1
|
%
|
|
1,233
|
|
|
2
|
%
|
||
Total MDCO-157
|
1,300
|
|
|
1
|
%
|
|
1,746
|
|
|
3
|
%
|
||
MDCO-2010
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
—
|
|
|
—
|
%
|
|
418
|
|
|
1
|
%
|
||
Manufacturing development
|
—
|
|
|
—
|
%
|
|
626
|
|
|
1
|
%
|
||
Administrative and headcount costs
|
—
|
|
|
—
|
%
|
|
1,418
|
|
|
2
|
%
|
||
Total MDCO-2010
|
—
|
|
|
—
|
%
|
|
2,462
|
|
|
4
|
%
|
||
MDCO-216
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
598
|
|
|
1
|
%
|
|
397
|
|
|
1
|
%
|
||
Manufacturing development
|
1,306
|
|
|
2
|
%
|
|
1,082
|
|
|
2
|
%
|
||
Administrative and headcount costs
|
1,843
|
|
|
2
|
%
|
|
651
|
|
|
1
|
%
|
||
Total MDCO-216
|
3,747
|
|
|
5
|
%
|
|
2,130
|
|
|
4
|
%
|
||
IONSYS
|
|
|
|
|
|
|
|
||||||
Clinical trials
|
864
|
|
|
|
|
|
|
|
|||||
Manufacturing development
|
3,329
|
|
|
4
|
%
|
|
—
|
|
|
—
|
%
|
||
Administrative and headcount costs
|
4,463
|
|
|
5
|
%
|
|
—
|
|
|
—
|
%
|
||
Total IONSYS
|
8,656
|
|
|
9
|
%
|
|
—
|
|
|
—
|
%
|
||
ALN-PCS Program
|
|
|
|
|
|
|
|
||||||
Administrative and headcount costs
|
25,000
|
|
|
29
|
%
|
|
—
|
|
|
—
|
%
|
||
Total ALN-PCS Program
|
25,000
|
|
|
29
|
%
|
|
—
|
|
|
—
|
%
|
||
Other
|
4,820
|
|
|
6
|
%
|
|
7,127
|
|
|
11
|
%
|
||
Total
|
$
|
85,221
|
|
|
100
|
%
|
|
$
|
65,740
|
|
|
100
|
%
|
•
|
the scope, rate of progress and cost of our clinical trials and other research and development activities;
|
•
|
future clinical trial results;
|
•
|
the terms and timing of any collaborative, licensing and other arrangements that we may establish;
|
•
|
the cost and timing of regulatory approvals;
|
•
|
the cost and timing of establishing and maintaining sales, marketing and distribution capabilities;
|
•
|
the cost of establishing and maintaining clinical and commercial supplies of our products and product candidates;
|
•
|
the effect of competing technological and market developments; and
|
•
|
the cost of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
||||||||||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||||||||||||||||
Selling, general and administrative expenses
|
$
|
52,944
|
|
|
$
|
40,467
|
|
|
$
|
12,477
|
|
|
30.8
|
%
|
|
$
|
116,426
|
|
|
$
|
83,653
|
|
|
$
|
32,773
|
|
|
39.2
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
||||||||||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||||||||||||||||
Co-promotion income
|
$
|
4,068
|
|
|
$
|
2,500
|
|
|
$
|
1,568
|
|
|
62.7
|
%
|
|
$
|
7,818
|
|
|
$
|
2,500
|
|
|
$
|
5,318
|
|
|
100.0
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
||||||||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||||||||||||||
Interest expense
|
$
|
(3,704
|
)
|
|
$
|
(784
|
)
|
|
$
|
(2,920
|
)
|
|
*
|
|
$
|
(7,377
|
)
|
|
$
|
(784
|
)
|
|
$
|
(6,593
|
)
|
|
*
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
||||||||||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||||||||||||||||
Other income
|
$
|
605
|
|
|
$
|
697
|
|
|
$
|
(92
|
)
|
|
(13.2
|
)%
|
|
$
|
803
|
|
|
$
|
759
|
|
|
$
|
44
|
|
|
5.8
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
|
2013
|
|
2012
|
|
Change $
|
|
Change %
|
||||||||||||||
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
(Provision) for income tax
|
$
|
(11,854
|
)
|
|
$
|
(8,251
|
)
|
|
$
|
(3,603
|
)
|
|
43.7
|
%
|
|
$
|
(1,095
|
)
|
|
$
|
(12,725
|
)
|
|
$
|
11,630
|
|
|
(91.4
|
)%
|
•
|
the extent to which Angiomax is commercially successful globally;
|
•
|
our ability to maintain market exclusivity for Angiomax in the United States through the enforcement of the '727 patent and the '343 patent during the period following the expiration of the patent term of the '404 patent on December 15, 2014 and the six month pediatric exclusivity on June 15, 2015 through at least May 1, 2019, the date on which we agreed APP may sell a generic version of Angiomax;
|
•
|
the extent to which Recothrom, Cleviprex, ready-to-use Argatroban and the acute care generic products for which we acquired the non-exclusive right to sell and distribute from APP are commercially successful in the United States;
|
•
|
the extent to which our global collaboration with AstraZeneca, including our four-year co-promotion arrangement for BRILINTA in the United States, is successful;
|
•
|
the extent to which we are successful in our efforts to establish a commercial infrastructure outside the United States;
|
•
|
the consideration paid by us and to be paid by us in connection with acquisitions and licenses of development-stage compounds, clinical-stage product candidates, approved products, or businesses, and in connection with other strategic arrangements;
|
•
|
the progress, level, timing and cost of our research and development activities related to our clinical trials and non-clinical studies with respect to Angiomax, Cleviprex and our products in development;
|
•
|
the cost and outcomes of regulatory submissions and reviews for approval of Angiomax in additional countries and for additional indications, of Recothrom and Cleviprex outside the United States and of our other products in development globally, including the recently acquired Fibrocaps;
|
•
|
the continuation or termination of third-party manufacturing, distribution and sales and marketing arrangements;
|
•
|
the size, cost and effectiveness of our sales and marketing programs globally;
|
•
|
the amounts of our payment obligations to third parties as to our products and products in development; and
|
•
|
our ability to defend and enforce our intellectual property rights.
|
•
|
As described above under “Business Development Activity-ProFibrix B.V.,” on June 4, 2013, we entered into a share purchase agreement with ProFibrix and its equityholders to acquire all of the equity of ProFibrix, subject to our satisfactory review of the then pending Phase 3 clinical trial results of ProFibrix's lead biologic, Fibrocaps. Following our review of
|
•
|
the nature of the estimate or assumption is material due to the level of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change; and
|
•
|
the impact of the estimates and assumptions on financial condition or operating performance is material.
|
•
|
our ability to maintain market exclusivity for Angiomax in the United States through the enforcement of the '727 patent and the '343 patent during the period following the expiration of the patent term of the '404 patent on December 15, 2014 and the six month pediatric exclusivity on June 15, 2015 through at least May 1, 2019, the date on which we agreed APP may sell a generic version of Angiomax;
|
•
|
the continued acceptance by regulators, physicians, patients and other key decision-makers of Angiomax as a safe, therapeutic and cost-effective alternative to heparin and other products used in current practice or currently being developed;
|
•
|
our ability to further develop Angiomax and obtain marketing approval of Angiomax for use in additional patient populations and the clinical data we generate to support expansion of the product label;
|
•
|
the overall number of PCI procedures performed;
|
•
|
the ability of our third-party supply and manufacturing partners to provide us with sufficient quantities of Angiomax;
|
•
|
the impact of competition from existing competitive products and from competitive products that may be approved in the future;
|
•
|
the continued safety and efficacy of Angiomax;
|
•
|
to what extent and in what amount government and third-party payors cover or reimburse for the costs of Angiomax; and
|
•
|
our success and the success of our international distributors in selling and marketing Angiomax in Europe and in other countries outside the United States.
|
•
|
the extent to which Angiomax is commercially successful globally;
|
•
|
our ability to maintain market exclusivity for Angiomax in the United States through the enforcement of the '727 patent and the '343 patent during the period following the expiration of the patent term of the '404 patent on December 15, 2014 and the six month pediatric exclusivity on June 15, 2015 through at least May 1, 2019, the date on which we agreed APP may sell a generic version of Angiomax;
|
•
|
the extent to which Recothrom, Cleviprex, ready-to-use Argatroban and the acute care generic products that we acquired the non-exclusive right to sell and distribute from APP are commercially successful in the United States;
|
•
|
the extent to which our global collaboration with AstraZeneca, including our four-year co-promotion arrangement for BRILINTA in the United States, is successful;
|
•
|
the extent to which we are successful in our efforts to establish a commercial infrastructure outside the United States;
|
•
|
the consideration paid by us and to be paid by us in connection with acquisitions and licenses of development-stage compounds, clinical-stage product candidates, approved products, or businesses, and in connection with other strategic arrangements;
|
•
|
the progress, level, timing and cost of our research and development activities related to our clinical trials and non-clinical studies with respect to Angiomax, Cleviprex and our products in development;
|
•
|
the cost and outcomes of regulatory submissions and reviews for approval of Angiomax in additional countries and for additional indications, of Recothrom and Cleviprex outside the United States and of our other products in development globally, including the recently acquired Fibrocaps;
|
•
|
the continuation or termination of third-party manufacturing, distribution and sales and marketing arrangements;
|
•
|
the size, cost and effectiveness of our sales and marketing programs globally;
|
•
|
the amounts of our payment obligations to third parties as to our products and products in development; and
|
•
|
our ability to defend and enforce our intellectual property rights.
|
•
|
difficulty in integrating the operations, products or product candidates and personnel of an acquired company;
|
•
|
entry into markets in which we have no or limited direct prior experience and where competitors in such markets have stronger market positions;
|
•
|
failure to successfully further develop the acquired or licensed business, product, compounds, programs or technology or to achieve strategic objectives, including commercializing and marketing successfully the development stage compounds and clinical stage candidates that we acquire or license;
|
•
|
disruption of our ongoing business and distraction of our management and employees from other opportunities and challenges;
|
•
|
inadequate or unfavorable clinical trial results from acquired or contracted for product candidates;
|
•
|
inability to retain personnel, key customers, distributors, vendors and other business partners of the acquired company, or acquired or licensed product or technology;
|
•
|
potential failure of the due diligence processes to identify significant problems, liabilities or other shortcomings or challenges of an acquired company, or acquired or licensed product or technology, including but not limited to, problems, liabilities or other shortcomings or challenges with respect to intellectual property, product quality, revenue recognition or other accounting practices, employee, customer or partner disputes or issues and other legal and financial contingencies and known and unknown liabilities;
|
•
|
liability for activities of the acquired company or licensor before the acquisition or license, including intellectual property infringement claims, violations of laws, commercial disputes, tax liabilities, and other known and unknown liabilities;
|
•
|
exposure to litigation or other claims in connection with, or inheritance of claims or litigation risk as a result of, an acquisition or license, including but not limited to, claims from terminated employees, customers, former stockholders or other third-parties; and
|
•
|
difficulties in the integration of the acquired company's departments, systems, including accounting, human resource and other administrative systems, technologies, books and records, and procedures, as well as in maintaining uniform standards, controls, including internal control over financial reporting required by the Sarbanes−Oxley Act of 2002 and related procedures and policies.
|
•
|
impacting our ability to satisfy our obligations;
|
•
|
increasing our vulnerability to general adverse economic and industry conditions;
|
•
|
limiting our ability to obtain additional financing in the future;
|
•
|
increasing the portion of our cash flows that may have to be dedicated to interest and principal payments and may not be available for operations, research and development, working capital, capital expenditures, expansion, acquisitions or general corporate or other purposes;
|
•
|
limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and
|
•
|
placing us at a possible competitive disadvantage to less leveraged competitors and competitors that have better access to capital resources.
|
•
|
the GELFOAM Plus hemostasis kit marketed by Baxter Healthcare Corporation;
|
•
|
mechanical hemostats, such as absorbable gelatin sponges;
|
•
|
collagen, cellulose, or polysaccharide-based hemostats applied as sponges, fleeces, bandages, or microspheres which do not contain thrombin or any other active biologic compounds;
|
•
|
active hemostats, which are thrombin products that may be derived from bovine or human pooled plasma purification or human recombinant manufacturing processes;
|
•
|
flowable hemostats, which consists of granular collagen or gelatin component that is mixed with saline or reconstituted thrombin to form a semi-solid, flowable putty; and
|
•
|
fibrin sealants, which consists of thrombin and fibrinogen that can be sprayed or applied directly to the bleeding surface.
|
•
|
continue to improve operating, administrative, and information systems;
|
•
|
accurately predict future personnel and resource needs to meet contract commitments;
|
•
|
track the progress of ongoing projects; and
|
•
|
attract and retain qualified management, sales, professional, scientific and technical operating personnel.
|
•
|
political and economic determinations that adversely impact pricing or reimbursement policies;
|
•
|
our customers' ability to obtain reimbursement for procedures using our products in foreign markets;
|
•
|
compliance with complex and changing foreign legal, tax, accounting and regulatory requirements;
|
•
|
language barriers and other difficulties in providing long-range customer support and service;
|
•
|
longer accounts receivable collection times;
|
•
|
significant foreign currency fluctuations, which could result in increased operating expenses and reduced revenues;
|
•
|
trade restrictions and restrictions on direct investment by foreign entities;
|
•
|
reduced protection of intellectual property rights in some foreign countries; and
|
•
|
the interpretation of contractual provisions governed by foreign laws in the event of a contract dispute.
|
•
|
delay or otherwise adversely impact the manufacturing, development or commercialization of our products, our products in development or any additional products or product candidates that we may acquire or develop;
|
•
|
require us to seek a new collaborator or undertake unforeseen additional responsibilities or devote unforeseen additional resources to the manufacturing, development or commercialization of our products; or
|
•
|
result in the termination of the development or commercialization of our products.
|
•
|
reliance on the third party for regulatory compliance and quality assurance;
|
•
|
the possible breach of the manufacturing or supply agreement by the third party; and
|
•
|
the possible termination or nonrenewal of the agreement by the third party, based on its own business priorities, at a time that is costly or inconvenient for us.
|
•
|
delay or prevent the successful commercialization of any of the products or product candidates in the jurisdiction for which approval is sought;
|
•
|
diminish our competitive advantage; and
|
•
|
defer or decrease our receipt of revenue.
|
•
|
our clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials which even if undertaken cannot ensure we will gain approval;
|
•
|
data obtained from pre-clinical testing and clinical trials may be subject to varying interpretations, which could result in the FDA or other regulatory authorities deciding not to approve a product in a timely fashion, or at all;
|
•
|
the cost of clinical trials may be greater than we currently anticipate;
|
•
|
regulators, ethics committees or institutional review boards may not authorize us to commence a clinical trial or conduct a clinical trial at a prospective trial site;
|
•
|
we, or the FDA or other regulatory authorities, might suspend or terminate a clinical trial at any time on various grounds, including a finding that participating patients are being exposed to unacceptable health risks. For example, we have in the past voluntarily suspended enrollment in one of our clinical trials to review an interim analysis of safety data from the trial; and
|
•
|
the effects of our product candidates may not be the desired effects or may include undesirable side effects or the product candidates may have other unexpected characteristics.
|
•
|
delay in approving or refusal to approve a product;
|
•
|
product recall or seizure;
|
•
|
suspension or withdrawal of an approved product from the market;
|
•
|
delays in, suspension of or prohibition of commencing, clinical trials of products in development;
|
•
|
interruption of production;
|
•
|
operating restrictions;
|
•
|
untitled or warning letters;
|
•
|
injunctions;
|
•
|
fines and other monetary penalties;
|
•
|
the imposition of civil or criminal penalties;
|
•
|
disruption of importing and exporting activities; and
|
•
|
unanticipated expenditures.
|
•
|
the Federal Anti-Kickback Law, which prohibits persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce either the referral of an individual or furnishing or arranging for a good or service for which payment may be made under federal health care programs such as Medicare and Medicaid;
|
•
|
other Medicare laws and regulations that prescribe the requirements for coverage and payment for services performed by our customers, including the amount of such payment;
|
•
|
the Federal False Claims Act, which imposes civil and criminal liability on individuals and entities who submit, or cause to be submitted, false or fraudulent claims for payment to the government;
|
•
|
the Federal False Statements Act, which prohibits knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with delivery of or payment for health care benefits, items or services; and
|
•
|
various state laws that impose similar requirements and liability with respect to state healthcare reimbursement and other programs.
|
•
|
obtain and maintain U.S. and foreign patents, including defending those patents against adverse claims;
|
•
|
secure patent term extension for the patents covering our approved products;
|
•
|
protect trade secrets;
|
•
|
operate without infringing the proprietary rights of others; and
|
•
|
prevent others from infringing our proprietary rights.
|
•
|
achievement or rejection of regulatory approvals of our product candidates and our products;
|
•
|
regulatory actions by the FDA or a foreign jurisdiction limiting or revoking the use of our products;
|
•
|
changes in securities analysts' estimates of our financial performance;
|
•
|
changes in valuations of similar companies;
|
•
|
variations in our operating results;
|
•
|
acquisitions and strategic partnerships;
|
•
|
announcements of technological innovations or new commercial products by us or our competitors or the filing of ANDAs, NDAs or BLAs for products competitive with ours;
|
•
|
disclosure of results of clinical testing or regulatory proceedings by us or our competitors;
|
•
|
the timing, amount and receipt of revenue from sales of our products and margins on sales of our products;
|
•
|
changes in governmental regulations;
|
•
|
developments in patent rights or other proprietary rights, particularly with respect to our U.S. Angiomax patents;
|
•
|
the extent to which Angiomax is commercially successful globally;
|
•
|
our ability to maintain market exclusivity for Angiomax in the United States through the enforcement of the '727 patent and the '343 patent during the period following the expiration of the patent term of the '404 patent on December 15, 2014 and the six month pediatric exclusivity on June 15, 2015 through at least May 1, 2019, the date on which we agreed APP may sell a generic version of Angiomax;
|
•
|
significant new litigation;
|
•
|
developments or issues with our contract manufacturers;
|
•
|
changes in our management; and
|
•
|
general market conditions.
|
•
|
Section 203 of the Delaware General Corporation Law, which provides that we may not enter into a business combination with an interested stockholder for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in the manner prescribed in Section 203;
|
•
|
our board of directors has the authority to issue, without a vote or action of stockholders, up to 5,000,000 shares of a new series of preferred stock and to fix the price, rights, preferences and privileges of those shares, each of which could be superior to the rights of holders of our common stock;
|
•
|
our directors are elected to staggered terms, which prevents our entire board of directors from being replaced in any single year;
|
•
|
our directors may be removed only for cause and then only by the affirmative vote of the holders of at least 75% of the votes which all stockholders would be entitled to cast in any annual election of directors;
|
•
|
the size of our board of directors is determined by resolution of the board of directors;
|
•
|
any vacancy on our board of directors, however occurring, including a vacancy resulting from an enlargement of our board, may only be filled by vote of a majority of our directors then in office, even if less than a quorum;
|
•
|
only our board of directors, the chairman of the board or our president may call special meetings of stockholders;
|
•
|
our by-laws may be amended, altered or repealed by (i) the affirmative vote of a majority of our directors, subject to any limitations set forth in the by-laws, or (ii) the affirmative vote of the holders of at least 75% of the votes which all the stockholders would be entitled to cast in any annual election of directors;
|
•
|
stockholders must provide us with advance notice, and certain information specified in our by-laws, in connection with nominations or proposals by such stockholder for consideration at an annual meeting;
|
•
|
stockholders may not take any action by written consent in lieu of a meeting; and
|
•
|
our certificate of incorporation may only be amended or repealed by the affirmative vote of a majority of our directors and the affirmative vote of the holders of at least 75% of the votes which all the stockholders would be entitled to cast in any annual election of directors (and plus any separate class vote that might in the future be required pursuant to the terms of any series of preferred stock that might be outstanding at the time any of these amendments are submitted to stockholders).
|
•
|
responding to proxy contests and other actions by activist shareholders may be costly and time-consuming and may disrupt our operations and divert the attention of management and our employees;
|
•
|
perceived uncertainties as to our future direction may result in our inability to consummate potential acquisitions, collaborations or in-licensing opportunities and may make it more difficult to attract and retain qualified personnel and business partners; and
|
•
|
if individuals are elected to our board of directors with a specific agenda different from ours, it may adversely affect our ability to effectively and timely implement our strategic plan and create additional value for our stockholders.
|
Date:
|
August 9, 2013
|
|
By:
|
/s/ Glenn P. Sblendorio
|
|
|
|
|
Glenn P. Sblendorio
|
|
|
|
|
President and Chief Financial
|
|
|
|
|
Officer (Principal Financial and Accounting Officer)
|
Exhibit Number
|
|
Description
|
10.1
|
|
2013 Stock Incentive Plan
|
|
|
|
10.2
|
|
Form of employee stock option agreement under 2013 Stock Incentive Plan
|
|
|
|
10.3
|
|
Form of non-employee director stock option agreement under 2013 Stock Incentive Plan
|
|
|
|
10.4
|
|
Form of employee restricted stock agreement under 2013 Stock Incentive Plan
|
|
|
|
10.5
|
|
Form of non-employee director restricted stock agreement under 2013 Stock Incentive Plan
|
|
|
|
10.6*
|
|
Share Purchase Agreement, dated June 4, 2013, by and among the registrant, ProFibrix B.V., the equityholders of ProFibrix, certain members of the management team of ProFibrix in their capacities as warrantors of certain information in the Share Purchase Agreement, the holders of options to acquire equity interests in ProFibrix and the representative (filed as Exhibit 2.1 of the registrant's current report on Form 8-K, filed on August 7, 2013)
|
|
|
|
31.1
|
|
Chairman and Chief Executive Officer Certification pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
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31.2
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Chief Financial Officer Certification pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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32.1
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Chairman and Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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32.2
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Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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101
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The following materials from The Medicines Company Quarterly Report on Form 10-Q for the quarter ended June 30, 2013, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheet, (ii) the Consolidated Statement of Income, (iii) the Consolidated Statement of Cash Flow, and (iv) Notes to Consolidated Financial Statements.
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*
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Confidential treatment requested as to certain portions, which portions have been omitted and filed separately with the Securities and Exchange Commission.
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1.
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Purpose
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2.
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Eligibility
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3.
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Administration and Delegation
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1.
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Grant of Option
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2.
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Vesting Schedule
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3.
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Exercise of Option
.
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4.
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Withholding
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5.
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Non-transferability of Option
.
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1.
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Grant of Option
.
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2.
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Vesting Schedule
.
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3.
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Exercise of Option
.
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4.
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Withholding
.
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5.
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Non-transferability of Option
.
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1.
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I have reviewed this Quarterly Report on Form 10-Q of The Medicines Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ Clive A. Meanwell
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Clive A. Meanwell
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Chairman and Chief Executive Officer
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Dated:
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August 9, 2013
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1.
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I have reviewed this Quarterly Report on Form 10-Q of The Medicines Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/ Glenn P. Sblendorio
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Glenn P. Sblendorio
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President and Chief Financial Officer
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Dated:
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August 9, 2013
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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By:
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/s/ Clive A. Meanwell
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Clive A. Meanwell
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Chairman and Chief Executive Officer
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Dated:
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August 9, 2013
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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By:
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/s/ Glenn P. Sblendorio
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Glenn P. Sblendorio
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President and Chief Financial Officer
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Dated:
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August 9, 2013
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