EXTON, Pa., May 1, 2013 /PRNewswire/ --ViroPharma Incorporated (VPHM) today announced financial results for the first quarter of 2013. Net sales were $107 million for the first quarter ended March 31, 2013 as compared to $136 million in the comparative period of 2012. The decline in net sales quarter over quarter was driven by thedecrease in Vancocin revenues partially offset by commercial product growth for Cinryze. The first quarter 2013 U.S. Cinryze net sales which grew by 44 percent over the first quarter of 2012 to $97 million, including approximately $91 million of patient demand. The balance represented additional inventory in the channel.
"The early part of 2013 has seen great progress both in our commercial business as well as our development pipeline," stated Vincent Milano, ViroPharma's chief executive officer. "In addition to the virologic response data we will share during our conference call today from subjects enrolled into our two maribavir studies, we also expect results from several key programs for Cinryze in the coming quarters such as subcutaneous Cinryze administration, antibody-mediated rejection (AMR) in kidney transplant, new uses for C1 INH, as well as additional progress updates with maribavir."
Our GAAP net loss was $64 million in the first quarter of 2013 compared to net income of $20 million in the first quarter of 2012. GAAP diluted net loss per share was $(0.98) for the first quarter of 2013 compared to GAAP diluted earnings per share of $0.26 for the same period in 2012. The loss for the quarter was driven by a $104 million non-cash impairment charge related to the Vancocin intangible asset due to rapid decline in market price of generic vancomycin. Also driving the quarter over quarter decrease was the loss of Vancocin revenues partially offset by the continued growth of Cinryze.
Non-GAAP adjusted net income for the three months ended March 31, 2013 was $11 million, compared to $31 million for the same period in 2012. Non-GAAP adjusted diluted net earnings per share was $0.15 for the first quarter of 2013 compared to $0.37 for the same period in 2012. A reconciliation between GAAP and non-GAAP adjusted measures is provided in the Selected Financial Information Non-GAAP Financial Measures Reconciliation table included with this release.
Operating Highlights
Cinryze net sales during the first quarter of 2013 were $99.5 million, a 46 percent increase over the same period in 2012 driven by demand growth, rebuilding channel inventories and net realized price growth. Vancocin net sales during the three months were $4 million compared to $66 million for the same period in 2012. The decrease is due to the impact of the launch of generic versions of vancomycin in April of 2012. During the first quarter of 2013, we generated net sales of approximately $7 million from our European operations.
Cost of sales decreased for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 by $2 million. The decrease in cost of sales was due to product mix and overall sales decline of Vancocin compared to the same period in the prior year. We anticipate that our cost of sales, on a relative basis, will remain higher than historical levels due to the introduction of generic vancomycin and the reduction of our sales of Vancocin relative to our Cinryze sales along with the royalty due to Genzyme on Vancocin-related sales.
Research and development costs incurred during the first quarter of 2013 increased compared to the same period in 2012 due to advancements in our clinical development programs, including the subcutaneous Cinryze and maribavir development programs, among others. The increase in selling, general and administrative expenses for the first quarter of 2013 compared to the same period in 2012 was driven by the growth of our global organization and our European commercialization efforts.
Because our Vancocin intangible asset is amortizable for tax purposes, we recorded a tax benefit of $41 million related to the impairment of the asset. We recognized a total tax benefit of $42 million in the quarter ended March 31, 2013 compared to a tax expense of $18 million in the quarter ended March 31, 2012.
Working Capital Highlights
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ViroPharma Announces First Quarter 2013 Financial Results