Ipsen first quarter sales increase 6.1% to €285.8 million

IpsenMay 3 2011

Ipsen (Paris:IPN) (Euronext: IPN; ADR: IPSEY) reported today its sales for the first quarter 2011.

Commenting on the first quarter 2011 performance, Marc de Garidel, Chairman and Chief Executive Officer of Ipsen said: "In an increasingly competitive environment, Ipsen's strong first quarter performance illustrates the pertinence of the company's positioning, with differentiated specialty drugs providing patients and physicians with high added-value therapeutic solutions. In particular, Ipsen's expertise in peptides and toxins, its global footprint and industry-wide recognized partnering capabilities are key for its future as a leading biopharmaceutical company. Our recent partnership in oncology with Active Biotech epitomizes our capacity to add to our pipeline innovative compounds targeting unmet medical needs and matching our portfolio." Marc de Garidel added: "We are near to completing our strategic review for Ipsen, and I will be delighted to share it on 9 June 2011".

First quarter 2011 sales highlights

Consolidated Group sales reached €285.8 million, up 6.1% year-on-year excluding foreign exchange impacts.

Drug sales reached €277.3 million, up 6.3% year-on-year excluding foreign exchange impacts. Price changes year-on-year negatively impacted sales by €5.6 million in the first quarter of 2011, lowering sales growth by 2.1%. Pressure was notably high in Europe, where total price cuts amounted to (€7.5) million, only partly compensated by price increases in the Rest of the World and North America.

The good performance in the first quarter was driven by the sustained growth of Specialty Care sales, up 8.5% year-on-year or up 7.0% excluding foreign exchange impacts. Neurology and endocrinology grew 18.9% and 12.0%, respectively, year-on-year at constant currency. Oncology sales were down 4.8% excluding foreign exchange impacts, reflecting a destocking effect in China related to the implementation of a new distribution model (where Ipsen now ships directly to its subsidiary rather than to a third-party distributor) as well as some destocking in France at wholesaler levels. Sales of Primary Care products were also robust, up 5.1% excluding foreign exchange impacts, positively impacted by a stocking effect in Russia for an amount of about €4.4 million, while the international sales growth was offset by the negative impacts of the French market situation.

Sales in Major Western European countries amounted to €132.0 million, down 4.9% year-on-year excluding foreign exchange impacts. Dynamic volume sales growth of specialty care products were more than offset by the consequences of a tougher competitive environment in the French primary care landscape and administrative measures in Germany and Spain. For the first quarter 2011, sales in this region represented 46.2% of total Group sales compared with 52.0% a year earlier.

Sales generated in the Other European countries reached €77.2 million, up 15.8% excluding foreign exchange impacts, benefiting notably from a positive stocking effect in Russia for primary care products for about €4.4 million. Performance was also fuelled by volume growth, notably in Switzerland, Czech Republic and Kazakhstan. For the first quarter 2011, sales in this region represented 27.0% of total consolidated Group sales, against 24.7% a year earlier.

Sales generated in North America reached €16.6 million, up 65.6% year-on-year excluding foreign exchange impacts driven by strong supply of Dysport^® to Medicis in aesthetic medicine, and by the continuous penetration of Somatuline^®, Dysport^® in cervical dystonia, and Increlex^®. Sales in North America represented 5.8% of total consolidated Group sales, against 3.7% a year earlier.

Sales generated in the Rest of the World reached €60.0 million, up 11.1% year-on-year excluding foreign exchange impacts. This performance was notably driven by strong volume growth in Algeria, Australia and Colombia while sales of Decapeptyl^® in China were penalized by a destocking effect related to the implementation of a new distribution model detailed above. In the first quarter 2011, sales in the Rest of the World represented 21.0% of total consolidated Group sales, against 19.7% a year earlier.