HALOZYME THERAPEUTICS, INC. SAN DIEGO, Nov. 10, 2014 /PRNewswire/ -- Halozyme Therapeutics, Inc. (NASDAQ: HALO) today reported financial results for the third quarter ended September 30, 2014. Financial highlights for the third quarter include revenues of $14.6 million and a net loss of $20.3 million, or $0.16 per share. This compares to revenues of $16.0 million and a net loss of $19.3 million, or $0.17 per share, for the third quarter of 2013.
"The third quarter was notable for completion of a review and update to our corporate strategy based on a portfolio assessment. The recent Fast Track and Orphan Drug designations for PEGPH20, new pre-clinical data further supporting the pan-tumor potential for PEGPH20 and strong investigator interest in both pancreatic and lung cancer trials have confirmed this as our priority proprietary product for investment. The growth in the number of approvals for ENHANZE(TM) - based products and the launch success of Roche's Herceptin SC affirms our confidence in the growth potential of the ENHANZE platform," stated Dr. Helen Torley, President and Chief Executive Officer. "Our pursuit of Hylenex(®) in Type 1 diabetes is a potential opportunity to expand the indication and increase sales of Hylenex. While discussions with the FDA are ongoing, we have learned that the FDA will likely request additional clinical data for a label update translating to potentially higher projected costs and longer time to market than had originally been anticipated. In the ongoing weeks, we intend to continue to seek clarity with FDA on what data will be required, if any. Once we have gained clarity as to the regulatory requirements for a label update, we intend to enter into collaborations with third parties or explore other strategic alternatives in order to exploit this opportunity. I am excited by the opportunity to focus our resources on advancing PEGPH20 and to expand utilization of our ENHANZE platform."
Third Quarter 2014 Highlights
-- Royalty revenues of $2.9 million represent over 70% growth from second
quarter: Royalty revenues represent April to June sales as a result of
the one quarter lag in royalty reports. The Herceptin SC launch is
progressing well with approximately 20% market share in the markets
launched through October. A notable recent milestone for Herceptin SC
is the recent reimbursement approval and launch in France, traditionally
one of the largest EU oncology markets.
-- HYQVIA(®) approved by the FDA and launched in the U.S.: In September,
the U.S. Food and Drug Administration (FDA) approved HYQVIA for the
treatment of primary immunodeficiency (PI) in adults and Baxter began
commercial introduction of the product on October 20(th). HYQVIA is the
first subcutaneous immune globulin (IG) treatment approved for PI
patients with a dosing regimen requiring only one infusion up to once
per month (every three to four weeks) and one injection site per
infusion to deliver a full therapeutic dose of IG.
-- PEGPH20 (PEGylated recombinant human hyaluronidase) received Fast Track
and Orphan Drug designation for pancreatic cancer: The FDA has granted
Fast Track designation for Halozyme's program investigating PEGPH20 in
combination with gemcitabine and nab-paclitaxel for the treatment of
patients with metastatic pancreatic cancer. The FDA Office of Orphan
Products Development also granted Orphan Drug status for PEGylated
recombinant human hyaluronidase for the treatment of pancreatic cancer
which grants this designation to medical products that demonstrate
promise for the treatment of rare diseases or conditions.
-- PEGPH20 (PEGylated recombinant human hyaluronidase) enrollment
progressing: 42 of 44 sites have received IRB approval for the Study 202
protocol amendment. A total of 25 of the target of approximately 100 new
patients have been enrolled to date.
-- SWOG resumes clinical trial of PEGPH20 in combination with modified
FOLFIRINOX for advanced pancreatic cancer: SWOG Cancer Research has
resumed patient enrollment and dosing of PEGPH20 in its ongoing Phase
1b/2 clinical trial (S1313). The trial is designed to evaluate PEGPH20
in combination with modified FOLFIRINOX chemotherapy (mFOLFIRINOX) in
patients with metastatic pancreatic adenocarcinoma. The study has
resumed under a revised protocol approved by the Independent Review
Boards at the participating clinical trial sites.
-- CONSISTENT 1 trial of Hylenex in patients with Type1 diabetes to be
ended after first year: While discussions with FDA are ongoing, we have
determined that with all patients having completed 12 months on the
trial at this time, we do not need additional data contribution from the
second year of CONSISTENT 1 and we will be stopping the study.
-- Second disclosed program under the Halozyme-Pfizer collaboration: Pfizer
intends to investigate a subcutaneous formulation using Halozyme's
Enhanze technology with rivipansel. Rivipansel is an investigational
compound under evaluation for the treatment of vaso-occlusive crisis in
individuals with sickle cell disease.
-- Reduction in force of approximately 13% completed in November 2014 to
align with strategic priorities: We completed a corporate
reorganization to align with strategic priorities. This reorganization
resulted in a workforce reduction of 22 employees. We will incur a
one-time charge in the fourth quarter of 2014 that will be largely
offset by reduced compensation expenses during the quarter.
Third Quarter and Nine Months 2014 Financial Highlights
-- Revenues for the third quarter of 2014 were $14.6 million, compared to
$16.0 million for the third quarter of 2013. Revenues in the third
quarter included $5.8 million in product sales of bulk rHuPH20 for use
in manufacturing Roche's collaboration products, $3.6 million in Hylenex
product sales, $2.9 million in royalty revenue from sales of products
under our collaborations and $2.1 million in collaboration revenues.
Revenues for the nine months were $45.0 million compared to $42.3
million for the same period in the previous year.
-- Research and development expenses for the third quarter of 2014 were
$19.9 million, compared to $25.7 million for the third quarter of 2013.
The decrease was primarily due to the inclusion in this quarter of
manufacturing expenses in cost of product sales instead of research and
development expenses as in the prior period last year.
-- Selling, general and administrative expenses for the third quarter of
2014 were $8.6 million, compared to $8.1 million for the third quarter
of 2013. The increase was mainly due to an increase in patent expenses.
-- The net loss for the third quarter of 2014 was $20.3 million, or $0.16
per share, compared to a net loss for the third quarter of 2013 of $19.3
million, or $0.17 per share. The net loss for the nine months to date
totaled $63.1 million, or $0.52 per share, compared to a net loss of
$61.5 million, or $0.55 per share, for the first nine months of 2013.
-- Cash, cash equivalents and marketable securities were $134.5 million at
September 30, 2014, compared to $147.6 million at June 30, 2014. Net
cash used in the third quarter of 2014 was approximately $13.1 million.
Webcast and Conference Call
Halozyme will webcast its quarterly update conference call today, November 10, 2014 at 4:30 p.m. EDT/1:30 p.m. PDT. During the call, management will discuss the financial results for the third quarter of 2014 and provide a business update. To listen to the live webcast please visit the "Investors" section of Halozyme's corporate website at www.halozyme.com. A webcast replay will be available shortly after the call at the same address. To participate by phone, please dial (866) 710-0179 (domestic callers) or (334) 323-7224 (international callers) using passcode 769890. A telephone replay will be available shortly after the call by dialing (877) 919-4059 (domestic callers) or (334) 323-0140 (international callers) using replay ID number 45298549.
About Halozyme
Halozyme Therapeutics is a biopharmaceutical company dedicated to developing and commercializing innovative products that advance patient care. With a diversified portfolio of enzymes that target the extracellular matrix, the company's research focuses primarily on a family of human enzymes, known as hyaluronidases, which increase the dispersion and absorption of biologics, drugs and fluids. Halozyme's pipeline addresses therapeutic areas, including oncology, diabetes and dermatology that have significant unmet medical need today. The company markets Hylenex(®) recombinant (hyaluronidase human injection) and has partnerships with Roche, Pfizer and Baxter. Halozyme is headquartered in San Diego. For more information on how we are innovating, please visit our corporate website at www.halozyme.com.
Safe Harbor Statement
In addition to historical information, the statements set forth above include forward-looking statements (including, without limitation, statements concerning the Company's future expectations and plans for enrollment of patients in Study 202 for PEGPH20, the development and commercialization of product candidates including planned clinical trials, the potential benefits and attributes of such product candidates, gaining clarity as to the regulatory pathway for updating the Hylenex(®) label for use in Type 1 diabetes, entering into new collaborations and potential royalty revenue from products from collaborations) that involve risk and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. The forward-looking statements are typically, but not always, identified through use of the words "believe," "enable," "may," "will," "could," "intends," "estimate," "anticipate," "plan," "predict," "probable," "potential," "possible," "should," "continue," and other words of similar meaning. Actual results could differ materially from the expectations contained in forward-looking statements as a result of several factors, including unexpected expenditures and costs, unexpected fluctuations or changes in revenues from collaborators, unexpected results or delays in development and regulatory review, regulatory approval requirements, unexpected adverse events and competitive conditions. These and other factors that may result in differences are discussed in greater detail in the Company's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 10, 2014.
Halozyme Therapeutics, Inc
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2014 2013 2014 2013
---- ---- ---- ----
Revenues:
Product
sales, net $9,617 $10,025 $27,679 $14,634
Royalties 2,895 - 5,382 -
Revenues
under
collaborative
agreements 2,094 5,988 11,896 27,667
Total revenues 14,606 16,013 44,957 42,301
------ ------ ------ ------
Operating Expenses:
Cost of
product
sales 5,141 683 16,585 2,706
Research and
development 19,904 25,689 59,968 75,714
Selling,
general and
administrative 8,587 8,135 27,589 22,991
-----------
Total operating expenses 33,632 34,507 104,142 101,411
------ ------ ------- -------
Operating loss (19,026) (18,494) (59,185) (59,110)
Investment and other income,
net 122 52 287 165
Interest expense (1,376) (850) (4,203) (2,547)
------ ---- ------ ------
Net Loss $(20,280) $(19,292) $(63,101) $(61,492)
======== ======== ======== ========
Basic and diluted net loss
per share $(0.16) $(0.17) $(0.52) $(0.55)
====== ====== ====== ======
Shares used in computing
basic and diluted net loss
per share 124,041 112,765 122,157 112,554
======= ======= ======= =======
Halozyme Therapeutics, Inc
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands)
September 30, December 31,
2014 2013
---- ----
ASSETS
Current assets:
Cash and cash
equivalents $46,375 $27,357
Marketable
securities,
available-for-
sale 88,089 44,146
Accounts
receivable, net 8,275 9,097
Inventories 6,916 6,170
Prepaid expenses
and other
assets 8,945 8,425
----------------
Total current assets 158,600 95,195
Property and equipment, net 3,249 3,422
Prepaid expenses and other assets 2,277 2,676
Restricted cash 500 500
Total Assets $164,626 $101,793
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $4,342 $3,135
Accrued expenses 15,023 14,369
Deferred
revenue,
current portion 5,153 7,398
Current portion
of long-term
debt, net 10,075 -
----------------
Total current liabilities 34,593 24,902
Deferred revenue, net of current
portion 47,572 45,745
Long-term debt, net 39,762 49,772
Other long-term liabilities 2,759 1,364
Stockholders' equity (deficit):
Common stock 125 115
Additional paid-
in capital 485,014 361,930
Accumulated
other
comprehensive
(loss) income (46) 17
Accumulated
deficit (445,153) (382,052)
------------
Total stockholders' equity
(deficit) 39,940 (19,990)
------ -------
Total Liabilities and
Stockholders' Equity (Deficit) $164,626 $101,793
======== ========
Investor Contact:
Schond Greenway
Halozyme Therapeutics
858-704-8352
ir@halozyme.com
Media Contact:
Susan Neath Francis
212-301-7182
sfrancis@w2ogroup.com
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SOURCE Halozyme Therapeutics, Inc.
