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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 10-Q

 

(Mark One)

ý

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

For the quarterly period ended June 30, 2003

 

 

 

OR

 

 

 

o

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

 

 

 

For the transition period from           to          

 

 

 

Commission file number: 0-19311

 

IDEC PHARMACEUTICALS CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

Delaware

 

33-0112644

(State or other jurisdiction of
incorporation or organization)

 

(I.R.S. Employer
Identification No.)

 

 

 

3030 Callan Road, San Diego, CA  92121

(Address of principal executive offices)    (Zip code)

 

 

 

(858) 431-8500

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

Yes   ý   No   o

 

Indicate by check mark whether the registrant is an accelerated filer (as defined by Rule 12b-2 of the Exchange Act).

 

Yes   ý   No   o

 

As of July 31, 2003, the Registrant had 155,449,170 shares of its common stock, $0.0005 par value, issued and outstanding.

 

 

 

IDEC PHARMACEUTICALS CORPORATION

 

FORM 10-Q — QUARTERLY REPORT

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2003

 

TABLE OF CONTENTS

 

PART I.

FINANCIAL INFORMATION

 

 

Item 1.

Financial Statements (unaudited)

 

Condensed Consolidated Statements of Income — Three and six months ended June 30, 2003 and 2002

 

Condensed Consolidated Balance Sheets — June 30, 2003 and December 31, 2002

 

Condensed Consolidated Statements of Cash Flows — Six months ended June 30, 2003 and 2002

 

Notes to Condensed Consolidated Financial Statements

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

 

Item 4.

Controls and Procedures

 

 

PART II.

OTHER INFORMATION

 

 

Item 1.

Legal Proceedings

 

 

Item 4.

Submission of Matters to a Vote of Security Holders

 

 

Item 6.

Exhibits and Reports on Form 8-K

 

 

PART I — FINANCIAL INFORMATION

Item 1.  Financial Statements.

 

 

idec pharmaceuticals corporation and subsidiaries

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

 

 

 

Three months
ended June 30,

 

Six months
ended June 30,

 

 

 

2003

 

2002

 

2003

 

2002

 

Revenues:

 

 

 

 

 

 

 

 

 

Product sales, net

 

$

4,980

 

$

3,300

 

$

10,642

 

$

3,300

 

Revenues from unconsolidated joint business

 

118,365

 

92,455

 

229,276

 

170,637

 

Corporate partner revenues

 

217

 

1,376

 

890

 

2,935

 

Total revenues

 

123,562

 

97,131

 

240,808

 

176,872

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

Cost of sales

 

3,791

 

889

 

4,643

 

889

 

Research and development

 

47,440

 

22,980

 

76,827

 

42,229

 

Selling, general and administrative

 

29,187

 

23,224

 

53,052

 

42,067

 

Total operating costs and expenses

 

80,418

 

47,093

 

134,522

 

85,185

 

Income from operations

 

43,144

 

50,038

 

106,286

 

91,687

 

Interest income, net

 

3,253

 

4,397

 

6,563

 

8,399

 

Income before income taxes

 

46,397

 

54,435

 

112,849

 

100,086

 

Income taxes

 

17,631

 

19,052

 

42,883

 

35,030

 

Net income

 

$

28,766

 

$

35,383

 

$

69,966

 

$

65,056

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.19

 

$

0.23

 

$

0.45

 

$

0.42

 

Diluted

 

$

0.17

 

$

0.20

 

$

0.41

 

$

0.37

 

 

 

 

 

 

 

 

 

 

 

Shares used in calculation of earnings per share:

 

 

 

 

 

 

 

 

 

Basic

 

155,171

 

152,827

 

154,924

 

153,128

 

Diluted

 

178,308

 

179,515

 

178,066

 

180,965

 

 

See accompanying notes to the condensed consolidated financial statements.

 

1

 

idec pharmaceuticals corporation and Subsidiaries

 

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value data)

(Unaudited)

 

 

 

June 30,
2003

 

December 31,
2002

 

assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

292,538

 

$

350,129

 

Securities available-for-sale

 

445,096

 

437,645

 

Accounts receivable, net

 

1,991

 

4,920

 

Due from related parties

 

103,729

 

100,288

 

Inventories

 

38,419

 

33,665

 

Deferred tax assets

 

25,909

 

27,675

 

Prepaid expenses and other current assets

 

20,359

 

23,288

 

Total current assets

 

928,041

 

977,610

 

 

 

 

 

 

 

Securities available-for-sale

 

713,059

 

660,091

 

Property and equipment, net

 

368,503

 

264,537

 

Deferred tax assets

 

73,374

 

85,197

 

Restricted cash

 

25,000

 

22,500