Cephalon, Inc. Reported Record Sales, Adjusted Net Income and Cash From Operations in 2010

FRAZER, Pa., Feb. 10, 2011 /PRNewswire/ -- Cephalon, Inc. (Nasdaq: CEPH) today reported 2010 net sales of $2.761 billion, a 28 percent increase compared to net sales of $2.152 billion for 2009. Basic income per common share for the year was $5.66. Excluding amortization expense and certain other items, adjusted net income for full year 2010 was $657 million, a 40 percent increase over the previous year. This exceeded the company's adjusted net income guidance range of $617 to $632 million for 2010. Basic adjusted income per common share for the year was $8.74 in 2010, a 35 percent increase over the $6.48 in 2009.

Central nervous system (CNS) franchise net sales were $1.394 billion during the year, an 18 percent increase compared to 2009. Pain franchise reported net sales of $526.3 million, a 6 percent increase versus last year. Oncology franchise net sales were $513.6 million, a 53 percent increase over 2009 due to strong net sales of TREANDA® (bendamustine hydrochloride) of $393.5 million. Sales of other products were $326.7 million, a 130 percent increase primarily due to the sales of the portfolio of products obtained through the acquisition of Mepha in April 2010.

During the fourth quarter 2010 Cephalon recorded net cash provided by operating activities of $131 million resulting in 2010 cash flow from operations of $782 million.

"As pleased as I am with our strong financial performance, I am as enthusiastic about the company we are building for tomorrow," said Kevin Buchi, Chief Executive Officer. "We now have one of the premier late stage pipelines in the industry and a geographically diversified business."

The company is updating its guidance for 2011. Total sales guidance for 2011 is increased to $3.015 -$3.095 billion as a result of an increase in CNS franchise sales to $1.45 -$1.49 billion. Pain franchise sales of $540 - $570 million, oncology franchise sales of $570 - $600 million, and other product sales of $420 - $450 million remain unchanged. Full year R&D guidance is increased to $520 - $540 million and SG&A guidance remains unchanged at $970 million - $1.00 billion. Adjusted net income guidance is increased to $665-$688 million. Basic adjusted income per common share guidance is increased to $8.70 - $9.00, assuming 76.4 million basic shares outstanding.

Cephalon is introducing first quarter 2011 sales guidance of $725 - $755 million, adjusted net income guidance of $144 - $159 million and basic adjusted income per common share guidance of $1.90 - $2.10 assuming 75.8 million basic shares outstanding.

Basic adjusted income per common share for both the first quarter 2011 and full-year 2011 is reconciled below and is subject to the assumptions set forth therein. References in this press release to basic income per common share, basic adjusted income per common share, basic adjusted income per common share guidance, adjusted net income, adjusted net income guidance, adjusted net income per common share, adjusted net income per common share guidance refers to those metrics on an "attributable to Cephalon" basis and does not include any income or losses attributable to noncontrolling interests.

Cephalon's management will discuss the company's full year 2010 performance in a conference call with investors beginning at 5:00 p.m. U.S. EST today. To participate in the conference call, dial +1-913-312-0724 and refer to conference code number 3115464. Investors can listen to the call live by logging on to the company's website at www.cephalon.com and clicking on "Investors" then "Webcast." The conference call will be archived and available to investors for one week after the call.

About Cephalon, Inc.

Cephalon is a global biopharmaceutical company dedicated to discovering, developing and bringing to market medications to improve the quality of life of individuals around the world. Since its inception in 1987, Cephalon has brought first-in-class and best-in-class medicines to patients in several therapeutic areas. Cephalon has the distinction of being one of the world's fastest-growing biopharmaceutical companies, now among the Fortune 1000 and a member of the S&P 500 Index, employing approximately 4,000 people worldwide. The company sells numerous branded and generic products around the world. In total, Cephalon sells more than 150 products in approximately 100 countries. More information on Cephalon and its products is available at http://www.cephalon.com

In addition to historical facts or statements of current condition, this press release may contain forward-looking statements. Forward-looking statements provide Cephalon's current expectations or forecasts of future events. These may include statements regarding anticipated scientific progress on its research programs; development of potential pharmaceutical products; interpretation of clinical results; prospects for regulatory approval; manufacturing development and capabilities; market prospects for its products; sales, adjusted net income and basic adjusted income per common share guidance for first-quarter 2011 and full-year 2011 and SG&A and R&D guidance for the first-quarter 2011 and full-year 2011; and other statements regarding matters that are not historical facts. You may identify some of these forward-looking statements by the use of words in the statements such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe" or other words and terms of similar meaning. Cephalon's performance and financial results could differ materially from those reflected in these forward-looking statements due to general financial, economic, regulatory and political conditions affecting the biotechnology and pharmaceutical industries as well as more specific risks and uncertainties facing Cephalon such as those set forth in its reports on Form 8-K, 10-Q and 10-K filed with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, any or all of these forward-looking statements may prove to be incorrect. Therefore, you should not rely on any such factors or forward-looking statements. Furthermore, Cephalon does not intend to update publicly any forward-looking statement, except as required by law. The Private Securities Litigation Reform Act of 1995 permits this discussion.

This press release and/or the financial results attached to this press release include "Adjusted Net Income," "Basic Adjusted Income per Common Share," "Adjusted Net Income Guidance," "Basic Adjusted Income per Common Share Guidance," and "Diluted Adjusted Income Per Common Share," amounts that are considered "non-GAAP financial measures" under SEC rules. As required, we have provided reconciliations of these measures. Additional required information is located in the Form 8-K furnished to the SEC in connection with this press release.