Incyte Reports 2019 Third Quarter Financial Results and Provides Updates on Key Clinical Programs
- Total product and royalty revenues of
$534 million (+24% vs. Q3 2018) and Jakafi® (ruxolitinib) revenues of$433 million (+25% vs. Q3 2018) for the quarter endedSeptember 30, 2019 ; raising full year 2019 Jakafi revenue guidance to a new range of$1.65-1.68 billion - Multiple positive developments within late-stage clinical portfolio, including New Drug Application (NDA) submission for pemigatinib, successful outcome of ruxolitinib REACH2 trial and updated data from ruxolitinib cream showing continued improvement in repigmentation of vitiligo lesions
Conference Call and Webcast Scheduled Today at
“Revenue growth continues to be very strong, driven by robust demand for Jakafi (ruxolitinib) in all three approved indications and, as a result, we are raising guidance for full year Jakafi net sales,” stated Hervé Hoppenot, Chief Executive Officer,
Portfolio Update
Oncology – key highlights
The positive result of REACH2, the Phase 3 study evaluating ruxolitinib in patients with steroid-refractory acute graft-versus-host disease (GVHD), was announced in October. The study met its primary endpoint of superior overall response rate (ORR) at Day 28 with ruxolitinib treatment compared to best available therapy. No new safety signals were observed, and the ruxolitinib safety profile in REACH2 was consistent with that seen in previously reported studies in steroid-refractory acute GVHD.
A recent interim efficacy and safety analysis conducted by an Independent Data Monitoring Committee (IDMC) recommended that the Phase 3 REACH3 trial of ruxolitinib in patients with steroid-refractory chronic GVHD should continue without modification. The result of REACH3 is expected in 2020.
The top-line result from GRAVITAS-301, the Phase 3 trial of itacitinib as a treatment for patients with newly diagnosed acute GVHD, is expected to be available at the end of 2019. GRAVITAS-309, a Phase 3 trial of itacitinib as a treatment for patients with newly diagnosed chronic GVHD, was initiated in January of this year with results expected in 2021.
The NDA seeking approval for pemigatinib as a second-line treatment for cholangiocarcinoma patients with FGFR2 fusions or rearrangements was submitted to the
Enrollment in the continuous dosing cohort of FIGHT-201, the Phase 2 trial of pemigatinib in patients with bladder cancer, is expected to complete by the end of 2019 and FIGHT-207, a Phase 2 solid tumor-agnostic trial evaluating pemigatinib in patients with driver-activations of FGF/FGFR, has been initiated.
|
Indication and status |
|
Ruxolitinib |
Steroid-refractory acute GVHD: Phase 3 (REACH2) met primary endpoint1 |
|
Itacitinib |
Treatment-naïve acute GVHD: Phase 3 (GRAVITAS-301)
|
|
Pemigatinib |
Cholangiocarcinoma: Phase 2 (FIGHT-202), Phase 3 (FIGHT-302)
|
|
Parsaclisib |
Follicular lymphoma: Phase 2 (CITADEL-203)
|
|
INCMGA0012 |
MSI-high endometrial cancer: Phase 2 (POD1UM-101)
|
Notes:
1) |
Clinical development of ruxolitinib in GVHD, including REACH2 and REACH3, conducted in collaboration with Novartis |
|
2) |
INCMGA0012 licensed from MacroGenics |
Inflammation and autoimmunity (IAI) – key highlights
Evidence of continued improvement with longer-term treatment was shown in the 52-week data from the randomized Phase 2 trial of ruxolitinib cream in patients with vitiligo, which were recently presented at the
The Phase 3 TRuE-AD development program of ruxolitinib cream in patients with atopic dermatitis is ongoing, with initial results expected in the first half of 2020.
|
Indication and status |
|
Ruxolitinib cream |
Atopic dermatitis: Phase 3 (TRuE-AD) |
|
INCB54707 |
Hidradenitis suppurativa: Phase 2
|
|
Itacitinib |
Ulcerative colitis: Phase 2
|
|
Parsaclisib |
Autoimmune hemolytic anemia: Phase 2 |
Discovery and early development – key highlights
Incyte’s portfolio of earlier-stage clinical candidates is detailed below.
Modality |
Candidates |
|
Small molecules |
INCB01158 (ARG)1, INCB81776 (AXL/MER), INCB62079 (FGFR4), epacadostat (IDO1),
|
|
Monoclonal antibodies2 |
INCAGN1876 (GITR), INCAGN2385 (LAG-3), INCAGN1949 (OX40),
|
|
Bispecific antibodies |
MCLA-145 (PD-L1xCD137)3 |
Notes:
1) |
INCB01158 development in collaboration with Calithera |
|
2) |
Discovery collaboration with Agenus |
|
3) |
MCLA-145 development in collaboration with Merus |
Partnered – key highlights
The status of Incyte’s partnered compounds is detailed below.
|
Indication and status |
|
Baricitinib |
Atopic dermatitis: Phase 3 (BREEZE-AD) |
|
Capmatinib (MET)2 |
NSCLC (with MET exon 14 skipping mutations): NDA expected in Q4 2019 (by Novartis)
|
Notes:
1) |
Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate to severe rheumatoid arthritis |
|
2) |
Worldwide rights to capmatinib licensed to Novartis |
2019 Third-Quarter and Year-to-Date Financial Results
The financial measures presented in this press release for the three and nine months ended
Beginning in the first quarter of 2019, after reviewing our Reconciliation of GAAP Net Income to Selected Non-GAAP Adjusted Information with the
Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used in conjunction with and to supplement Incyte’s operating results as reported under GAAP. Non-GAAP measures may be defined and calculated differently by other companies in our industry.
The Company’s 2019 financial guidance related to research and development and selling, general and administrative expenses does not include estimates associated with any potential future strategic transactions.
Revenues
For the quarter ended
For the quarter and nine months ended
For the quarter and nine months ended
For the quarter and nine months ended
Year Over Year Revenue Growth |
||||||||||||
(in thousands, unaudited) |
||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||
September 30, |
% |
September 30, |
% |
|||||||||
2019 |
|
2018 |
|
Change |
|
2019 |
|
2018 |
|
Change |
||
Revenues: |
||||||||||||
Jakafi net product revenue |
$ 433,387 |
$ 347,567 |
25% |
$ 1,218,504 |
$1,006,911 |
21% |
||||||
Iclusig net product revenue |
20,611 |
20,148 |
2% |
65,640 |
60,833 |
8% |
||||||
Jakavi product royalty revenues |
58,440 |
50,923 |
15% |
160,906 |
139,361 |
15% |
||||||
Olumiant product royalty revenues |
21,643 |
11,000 |
97% |
56,820 |
26,231 |
117% |
||||||
Product and royalty revenues |
534,081 |
429,638 |
24% |
1,501,870 |
1,233,336 |
22% |
||||||
Milestone and contract revenues |
17,500 |
20,000 |
77,500 |
120,000 |
||||||||
Other revenues |
- |
45 |
- |
145 |
||||||||
Total GAAP revenues |
$ 551,581 |
$ 449,683 |
23% |
$ 1,579,370 |
$1,353,481 |
17% |
Cost of product revenues GAAP cost of product revenues for the quarter and nine months ended
Research and development expenses GAAP research and development expenses for the quarter and nine months ended
Non-GAAP research and development expenses for the quarter and nine months ended
Selling, general and administrative expenses GAAP selling, general and administrative expenses for the quarter and nine months ended
Non-GAAP selling, general and administrative expenses for the quarter and nine months ended
Change in fair value of acquisition-related contingent consideration GAAP change in fair value of acquisition-related contingent consideration for the quarter and nine months ended
Unrealized gain (loss) on long term investments GAAP unrealized gain on long term investments for the quarter and nine months ended
Net income GAAP net income for the quarter ended
Non-GAAP net income for the quarter ended
Cash, cash equivalents and marketable securities position As of
2019 Financial Guidance
The Company has updated its full year 2019 financial guidance, as detailed below.
|
|
Current |
Previous |
Jakafi net product revenues |
|
$1,650 - $1,680 million |
$1,610 - $1,650 million |
Iclusig net product revenues |
$90 - $100 million |
Unchanged |
|
|
|
|
|
GAAP Cost of product revenues |
|
$112 - $117 million |
Unchanged |
Non-GAAP Cost of product revenues(1) |
|
$90 - $95 million |
Unchanged |
|
|
|
|
GAAP Research and development expenses |
|
$1,145 - $1,195 million |
Unchanged |
Non-GAAP Research and development expenses(2) |
|
$1,020 - $1,070 million |
Unchanged |
|
|
|
|
GAAP Selling, general and administrative expenses |
$471 - $521 million |
Unchanged |
|
Non-GAAP Selling, general and administrative expenses(2) |
|
$420 - $470 million |
Unchanged |
|
|
|
|
GAAP Change in fair value of acquisition-related contingent consideration |
|
$30 million |
Unchanged |
Non-GAAP Change in fair value of acquisition-related contingent consideration(3) |
|
$0 million |
Unchanged |
(1) |
Adjusted to exclude the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the estimated cost of stock-based compensation. |
|
(2) |
Adjusted to exclude the estimated cost of stock-based compensation. |
|
(3) |
Adjusted to exclude the change in fair value of estimated future royalties relating to sales of Iclusig in the licensed territory relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. |
Future Non-GAAP financial measures may also exclude impairment of goodwill or other assets, changes in the fair value of equity investments in our collaboration partners, non-cash interest expense related to the amortization of the initial discount on our 2020 Senior Notes and the impact on our tax provision of discrete changes in our valuation allowance position on deferred tax assets.
Conference Call and Webcast Information
If you are unable to participate, a replay of the conference call will be available for 30 days. The replay dial-in number for
The conference call will also be webcast live and can be accessed at www.incyte.com in the Investors section under “Events and Presentations”.
About
Follow @
About Jakafi® (ruxolitinib)
Jakafi is a first-in-class JAK1/JAK2 inhibitor approved by the U.S.
Jakafi is also indicated for treatment of polycythemia vera (PV) in adults who have had an inadequate response to or are intolerant of hydroxyurea as well as adults with intermediate or high-risk myelofibrosis (MF), including primary MF, post-polycythemia vera MF and post-essential thrombocythemia MF.
Jakafi is marketed by
About Iclusig® (ponatinib) tablets
Iclusig targets not only native BCR-ABL but also its isoforms that carry mutations that confer resistance to treatment, including the T315I mutation, which has been associated with resistance to other approved TKIs.
In the EU, Iclusig is approved for the treatment of adult patients with chronic phase, accelerated phase or blast phase chronic myeloid leukemia (CML) who are resistant to dasatinib or nilotinib; who are intolerant to dasatinib or nilotinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation, or the treatment of adult patients with
Forward-Looking Statements
Except for the historical information set forth herein, the matters set forth in this release contain predictions, estimates and other forward-looking statements, including without limitation statements regarding: the revision to the Company’s 2019 Jakafi revenue guidance range; the expected timing of results of the trials evaluating ruxolitinib and itacitinib in GVHD; the expected date of completion of enrollment in the Phase 2 trial of pemigatinib in patients with bladder cancer; expectations of the Company’s collaboration partner for the submission of an NDA for capmatinib; the expected timing of the receipt of data from the Phase 3 trials of ruxolitinib cream in vitiligo and atopic dermatitis; and the Company’s updated financial guidance for 2019 and the expectations underlying such guidance.
These forward-looking statements are based on the Company’s current expectations and subject to risks and uncertainties that may cause actual results to differ materially, including unanticipated developments in and risks related to: unanticipated delays; further research and development and the results of clinical trials possibly being unsuccessful or insufficient to meet applicable regulatory standards or warrant continued development; the ability to enroll sufficient numbers of subjects in clinical trials; determinations made by the
INCYTE CORPORATION |
||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||||
(unaudited, in thousands, except per share amounts) |
||||||||||||||||||
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||
September 30, |
|
September 30, |
||||||||||||||||
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||||||
GAAP |
|
GAAP |
||||||||||||||||
Revenues: |
||||||||||||||||||
Product revenues, net |
$ |
453,998 |
|
$ |
367,715 |
|
$ |
1,284,144 |
|
$ |
1,067,744 |
|
||||||
Product royalty revenues |
|
80,083 |
|
|
61,923 |
|
|
217,726 |
|
|
165,592 |
|
||||||
Milestone and contract revenues |
|
17,500 |
|
|
20,000 |
|
|
77,500 |
|
|
120,000 |
|
||||||
Other revenues |
|
- |
|
|
45 |
|
|
- |
|
|
145 |
|
||||||
Total revenues |
|
551,581 |
|
|
449,683 |
|
|
1,579,370 |
|
|
1,353,481 |
|
||||||
Costs and expenses: |
||||||||||||||||||
Cost of product revenues (including definite-lived intangible amortization) |
|
30,040 |
|
|
24,795 |
|
|
82,034 |
|
|
67,757 |
|
||||||
Research and development |
|
281,336 |
|
|
292,527 |
|
|
841,244 |
|
|
893,719 |
|
||||||
Selling, general and administrative |
|
102,608 |
|
|
96,522 |
|
|
332,534 |
|
|
326,049 |
|
||||||
Change in fair value of acquisition-related contingent consideration |
|
3,281 |
|
|
4,720 |
|
|
16,560 |
|
|
18,708 |
|
||||||
Total costs and expenses |
|
417,265 |
|
|
418,564 |
|
|
1,272,372 |
|
|
1,306,233 |
|
||||||
Income from operations |
|
134,316 |
|
|
31,119 |
|
|
306,998 |
|
|
47,248 |
|
||||||
Other income (expense), net |
|
11,961 |
|
|
10,211 |
|
|
36,334 |
|
|
20,481 |
|
||||||
Interest expense |
|
(597 |
) |
|
(405) |
|
|
(1,248) |
|
|
(1,188) |
|
||||||
Unrealized gain (loss) on long term investments |
|
2,339 |
|
|
(9,949) |
|
|
18,703 |
|
|
(21,911) |
|
||||||
Income before provision for income taxes |
|
148,019 |
|
|
30,976 |
|
|
360,787 |
|
|
44,630 |
|
||||||
Provision for income taxes |
|
19,748 |
|
|
1,800 |
|
|
24,886 |
|
|
4,200 |
|
||||||
Net income |
$ |
128,271 |
|
$ |
29,176 |
|
$ |
335,901 |
|
$ |
40,430 |
|
||||||
Net income per share: |
||||||||||||||||||
Basic |
$ |
0.60 |
|
$ |
0.14 |
|
$ |
1.57 |
|
$ |
0.19 |
|
||||||
Diluted |
$ |
0.59 |
|
$ |
0.14 |
|
$ |
1.55 |
|
$ |
0.19 |
|
||||||
Shares used in computing net income per share: |
||||||||||||||||||
Basic |
|
215,199 |
|
|
212,627 |
|
|
214,628 |
|
|
212,172 |
|
||||||
Diluted |
|
217,791 |
|
|
215,964 |
|
|
217,393 |
|
|
215,516 |
|
||||||
INCYTE CORPORATION |
||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||
(unaudited, in thousands) |
||||||
September 30, |
December 31, |
|||||
2019 |
|
2018 |
||||
ASSETS |
||||||
Cash, cash equivalents and marketable securities |
$ |
1,986,218 |
$ |
1,438,323 |
||
Accounts receivable |
|
276,116 |
|
307,598 |
||
Property and equipment, net |
|
347,250 |
|
319,751 |
||
Finance lease right-of-use assets, net |
|
29,690 |
|
- |
||
Inventory |
|
13,318 |
|
10,405 |
||
Prepaid expenses and other assets |
|
89,519 |
|
99,529 |
||
Long term investments |
|
117,902 |
|
99,199 |
||
Other intangible assets, net |
|
199,212 |
|
215,364 |
||
Goodwill |
|
155,593 |
|
155,593 |
||
Total assets |
$ |
3,214,818 |
$ |
2,645,762 |
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||
Accounts payable, accrued expenses and other liabilities |
$ |
492,211 |
$ |
415,360 |
||
Convertible senior notes |
|
18,080 |
|
17,434 |
||
Acquisition-related contingent consideration |
|
282,000 |
|
287,001 |
||
Stockholders’ equity |
|
2,422,527 |
|
1,925,967 |
||
Total liabilities and stockholders’ equity |
$ |
3,214,818 |
$ |
2,645,762 |
||
INCYTE CORPORATION |
||||||||||||||||
RECONCILIATION OF GAAP NET INCOME TO SELECTED NON-GAAP ADJUSTED INFORMATION |
||||||||||||||||
(unaudited, in thousands, except per share amounts) |
||||||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||||||
September 30, |
September 30, |
|||||||||||||||
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||||
GAAP Net Income |
$ |
128,271 |
|
$ |
29,176 |
|
$ |
335,901 |
|
$ |
40,430 |
|
||||
Adjustments1: |
||||||||||||||||
Non-cash stock compensation from equity awards (R&D)2 |
|
30,426 |
|
|
26,266 |
|
|
85,464 |
|
|
75,283 |
|
||||
Non-cash stock compensation from equity awards (SG&A)2 |
|
12,758 |
|
|
11,687 |
|
|
38,575 |
|
|
35,500 |
|
||||
Non-cash stock compensation from equity awards (COGS)5 |
|
173 |
|
|
- |
|
|
525 |
|
|
- |
|
||||
Non-cash interest expense related to convertible notes3 |
|
218 |
|
|
305 |
|
|
646 |
|
|
902 |
|
||||
Changes in fair value of equity investments4 |
|
(2,339) |
|
|
9,949 |
|
|
(18,703) |
|
|
21,911 |
|
||||
Amortization of acquired product rights5 |
|
5,384 |
|
|
5,384 |
|
|
16,152 |
|
|
16,152 |
|
||||
Change in fair value of contingent consideration6 |
|
3,281 |
|
|
4,720 |
|
|
16,560 |
|
|
18,708 |
|
||||
Tax effect of Non-GAAP adjustments7 |
|
847 |
|
|
(10) |
|
|
910 |
|
|
(400) |
|
||||
Non-GAAP Net Income |
$ |
179,019 |
|
$ |
87,477 |
|
$ |
476,030 |
|
$ |
208,486 |
|
||||
Non-GAAP net income per share: |
||||||||||||||||
Basic |
$ |
0.83 |
|
$ |
0.41 |
|
$ |
2.22 |
|
$ |
0.98 |
|
||||
Diluted |
$ |
0.82 |
|
$ |
0.41 |
|
$ |
2.19 |
|
$ |
0.97 |
|
||||
Shares used in computing Non-GAAP net income per share: |
||||||||||||||||
Basic |
|
215,199 |
|
|
212,627 |
|
|
214,628 |
|
|
212,172 |
|
||||
Diluted |
|
217,791 |
|
|
215,964 |
|
|
217,393 |
|
|
215,516 |
|
1 |
Beginning in the first quarter of 2019, after reviewing our Reconciliation of GAAP Net Income to Selected Non-GAAP Adjusted Information with the U.S. Securities & Exchange Commission, we no longer adjust for milestones received from new or existing partners and upfront consideration and milestones paid to new or existing partners, which is reflected above for the three and nine months ended September 30, 2019 and 2018. Included within the Milestone and contract revenues line item in the Consolidated Statements of Operations (in thousands) for the three and nine months ended September 30, 2019 are upfront consideration and milestones of $17,500 and $77,500, respectively, earned from our collaborative partners. Also included within the Milestone and contract revenues line item in the Consolidated Statements of Operations (in thousands) for the three and nine months ended September 30, 2018 are milestones of $20,000 and $120,000, respectively, earned from our collaborative partners. Included within the Research and development expenses line item in the Consolidated Statements of Operations (in thousands) for the nine months ended September 30, 2019 are upfront and milestone expenses of $25,000 related to our collaborative agreements. Also included within the Research and development expenses line item in the Consolidated Statements of Operations (in thousands) for the three and nine months ended September 30, 2018 are upfront and milestone expenses of $15,000 and $47,444, respectively, related to our collaborative agreements. |
2 |
As included within the Research and development expenses line item in the Consolidated Statements of Operations, and within the Selling, general and administrative expenses line item in the Consolidated Statements of Operations. |
3 |
As included within the Interest expense line item in the Consolidated Statements of Operations. |
4 |
As included within the Unrealized gain (loss) on long term investments line item in the Consolidated Statements of Operations. |
5 |
As included within the Cost of product revenues (including definite-lived intangible amortization) line item in the Consolidated Statements of Operations. Acquired product rights of licensed intellectual property for Iclusig is amortized utilizing a straight-line method over the estimated useful life of 12.5 years. |
6 |
As included within the Change in fair value of acquisition-related contingent consideration line item in the Consolidated Statements of Operations. |
7 |
As included within the Provision for income taxes line item in the Consolidated Statements of Operations. Income tax effects of Non-GAAP adjustments are calculated using the applicable statutory tax rate for the jurisdictions in which the charges are incurred, while taking into consideration any valuation allowances. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20191029005365/en/
Source:
Media
Catalina Loveman
+1 302 498 6171
cloveman@incyte.com
Investors
Michael Booth, DPhil
+1 302 498 5914
mbooth@incyte.com