OPKO Health Reports 2016 Financial and Operating Results
May 09 2017 - 4:10PM
- U.S. commercial launch of RAYALDEE
underway
- 4Kscore test utilization continues to
grow; Level 1 CPT code and CMS pricing in place
- Pediatric global phase 3 initiated and Japanese
registration trial for hGH-CTP commencing shortly
- Adult study trial data analysis near completion;
preparation for Biologics License Application (BLA) submission
underway
- Clinical trials of Claros point of care (POC) PSA test
began in January 2017; PMA filing anticipated upon completion;
Claros POC testosterone test clinical trials and 510(k) filing to
follow
- Initiation of four Phase 2 trials anticipated in 2H
2017 and early 2018 - RAYALDEE for dialysis
patients with secondary hyperparathyroidism
(SHPT) - OPK88003, an orally
administered selective androgen receptor modulator (SARM) for BPH
(Benign Prostatic Hypertrophy) - OPK88004, a
once weekly oxyntomodulin dual GLP1-Glucagon agonist for type 2
diabetes and obesity - OPK88002, an NK-1
inhibitor to treat pruritus (itching) in dialysis
patients
- OPK8801, Orphan Drug Status received in the U.S. and EU
for new Oligonucleotide to treat Dravet Syndrome; IND planned for
2H 2017
- Clinical trials ongoing for long acting Factor
VII-CTP
- Consolidated revenue for the quarter ended March 31,
2017 increased to $296.1 million from $291.0 million for the
comparable 2016 period
- For the three months ended March 31, 2017, net loss was
$31.0 million compared to net loss of $12.0 million for the
comparable 2016 period
- Financial results reflect significant investments in
our pipeline development and marketing and sales expenses related
to the introduction of RAYALDEE
OPKO Health, Inc. (NASDAQ:OPK), reports operating
and financial results for the three months ended March 31, 2017.
Business Highlights
- U.S. commercial launch of RAYALDEE
underway: RAYALDEE was launched by our experienced
commercial marketing and sales teams and substantial progress has
been made in obtaining formulary access for RAYALDEE, with more
than 60% of potential patient lives now covered under insurance
plans. Obtaining broad insurance coverage is a critical step
in the adoption of the use of RAYALDEE.
- Forthcoming revisions to the Kidney Disease Improving
Global Outcomes (or KDIGO) Clinical Practice Guidelines for Chronic
Kidney Disease – Mineral and Bone Disorder CKD-MBD) are expected to
recommend against the routine use of vitamin D receptor activators
(VDRAs) for the treatment of SHPT in this
population. This guideline is also expected to
highlight the unproven effectiveness of nutritional vitamin D as a
treatment for SHPT and is anticipated to greatly enhance the
adoption of RAYALDEE therapy by physicians and patients.
- Dr. Akhtar Ashfaq, a board certified nephrologist with
significant industry experience, has joined OPKO as Senior Vice
President, Clinical Research & Development and Medical
Affairs. Dr. Ashfaq will support commercial and
scientific development strategies for RAYALDEE.
- 4Kscore test utilization continues to
grow; Level 1 CPT code and CMS pricing in place, negotiations with
payors continue. Level 1 CPT code and CMS pricing
became effective on January 1, 2017, and the Company is actively
working to secure coverage with additional payors. During the
quarter ended March 31, 2017 approximately 18,600 4Kscore tests
were ordered which represents growth of more than 100% from the
first three months of 2016.
- Phase 3 pediatric trial for hGH-CTP initiated; Analyses
of data from long acting hGH-CTP trial in adults continue and BLA
preparation for FDA submission underway: OPKO will
complete a statistical outlier analysis of data from its Phase 3
trial study in adults and, together with Pfizer, is preparing a BLA
for FDA submission.
- Phase 2a trial for intravenously administered Factor
VII-CTP and Phase 1 trial for subcutaneously administered Factor
VII-CTP are ongoing. These long acting forms of
Factor VII utilizing OPKO’s CTP platform technology are expected to
better support prophylaxis, provide for easier administration and
decrease the frequency of dosing.
- Analytical and clinical validation trials for Claros
point of care (POC) PSA test began in January 2017; PMA filing
anticipated upon completion; Claros POC testosterone test trials
and 510(k) filing to follow. OPKO has begun analytic and
clinical validation studies of its POC diagnostic test for prostate
specific antigen (PSA) utilizing its proprietary diagnostic
platform and intends to submit its PMA application to the FDA for
approval in 2017. OPKO expects to begin an additional
multi-center study of its POC testosterone test in 2017 followed by
a 510(k) submission.
- Initiation of four Phase 2 clinical trials anticipated
in 2H 2017 and early 2018 - RAYALDEE line extension in dialysis
patients with SHPT: Together with its partner, Vifor
Fresenius, OPKO is developing RAYALDEE for Stage 5 CKD patients
with SHPT undergoing dialysis and anticipates initiating a Phase 2
trial during the second half of 2017. - OPK88003, an orally
administered selective androgen receptor modulator (SARM):
The Company plans to initiate a Phase 2b dose ranging study in the
second half of 2017 to evaluate the use of
OPK88003 to treat men with benign prostate
hypertrophy (BPH) (enlarged prostate). It is expected to
ameliorate symptoms of BPH by reducing prostate size and, on the
basis of data from a previous trial in 350 men, provide other
benefits such as increase in muscle mass and bone strength and
decreased fat mass.- OPK88004, a once
weekly oxyntomodulin dual GLP1-Glucagon agonist for type 2 diabetes
and obesity: OPKO plans to initiate a Phase 2b study
in early 2018 to determine optimal dosing. The drug has been
shown to be safe and effective in a previous 400 patient Phase 2a
trial.- OPK88002, an NK-1 inhibitor to treat pruritus
(itching) in Stage 5 CKD patients undergoing
dialysis: Approximately 50% of renal dialysis
patients experience difficult to control pruritus. An IND was
recently filed for a Phase 2a trial of OPK88002, obtained as part
of the transaction with Schering Plough in which OPKO also obtained
Rolapitant, licensed to TESARO, and now on the market.
- Orphan Drug Status received in the U.S. and EU for its
new Oligonucleotide to treat Dravet Syndrome IND planned for 2H
2017; OPKO's oligonucleotide based AntagoNAT
(OPK88001) for the treatment of Dravet Syndrome has received orphan
drug designation in the US and EU and OPKO plans to initiate
clinical trials of OPK88001 for treatment of Dravet Syndrome later
this year. Currently, there is no globally approved treatment
for Dravet Syndrome. AntagoNAT, anti-Natural Antisense
Transcripts, is an OPKO platform technology in which single strand
oligonucleotide molecules are designed to interfere with regulatory
gene expression in order to enhance production of endogenous
functional proteins.
- The combination of our expanding and maturing pipeline
of products in clinical development and the expected increase in
sales of existing products currently in the market positions the
company well for significant growth
Financial Highlights
- Consolidated revenues for the three months ended March 31, 2017
of $296.1 million improved incrementally over the comparable period
of 2016 of $291.0 million.
- During the first three months of 2017, operating expenses
included significant investment in the commercial activities
supporting the launch of RAYALDEE, as well as continued
investment in advancement of the Company’s pharmaceutical
pipeline.
- The three month period ended March 31, 2016 benefited from a
non-recurring income tax rate change in Israel, which was the
principal result of the $20.5 million income tax benefit.
- Cash, cash equivalents and marketable securities were $131.1
million as of March 31, 2017.
CONFERENCE CALL & WEBCAST INFORMATION:
OPKO’s senior management will provide a business update and
discuss results in greater detail in a conference call and
live audio webcast at 4:30 p.m. Eastern time today.
The conference call dial in information is listed below. To
access the webcast, please log on to the OPKO website at
www.opko.com.
WHEN: Tuesday, May 9, 2017, 4:30 p.m. Eastern time.DOMESTIC
DIAL-IN: (866)
634-2258
INTERNATIONAL DIAL-IN: (330)
863-3454
PASSCODE: 17226044WEBCAST: http://investor.opko.com/events.cfm
For those unable to participate in the live conference call or
webcast, a replay will be available beginning May 9, 2017 two hours
after the close of the conference call. To access the replay, dial
(855) 859-2056 or (404) 537-3406. The replay passcode is: 17226044.
The replay can be accessed for a period of time on OPKO’s
website at http://investor.opko.com.
About OPKO Health, Inc.
OPKO Health is a diversified healthcare company that seeks to
establish industry-leading positions in large, rapidly growing
markets. Our diagnostics business includes Bio-Reference
Laboratories, the nation's third-largest clinical laboratory with a
core genetic testing business and a 400-person sales and marketing
team to drive growth and leverage new products, including the
4Kscore® prostate cancer test and the Claros® 1 in-office
immunoassay platform. Our pharmaceutical business features
RAYALDEE, an FDA-approved treatment for SHPT in stage 3-4 CKD
patients with vitamin D insufficiency (launched in November 2016),
VARUBI™ for chemotherapy-induced nausea and vomiting (oral
formulation launched by partner TESARO and IV formulation pending
FDA approval), OPK88004, a once or twice weekly oxyntomodulin for
type 2 diabetes and obesity which is a clinically advanced drug
candidate among the new class of GLP-1 glucagon receptor dual
agonists, and OPK88003, an androgen receptor modulator for androgen
deficiency indications. Our biologics business includes hGH-CTP, a
once weekly human growth hormone injection (in phase 3 and
partnered with Pfizer), and a long-acting Factor VIIa drug for
hemophilia in phase 2a. We also have production and distribution
assets worldwide, multiple strategic investments and an active
business development strategy. More information available at
www.opko.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains "forward-looking statements," as
that term is defined under the Private Securities Litigation Reform
Act of 1995 (PSLRA), which statements may be identified by words
such as "expects," "plans," "projects," "will," "may,"
"anticipates," "believes," "should," "intends," "estimates," and
other words of similar meaning, including statements regarding
expected financial performance and expectations regarding sales of
our products, whether 4Kscore test utilization will continue to
grow, our product development efforts and the expected benefits of
our products, including whether our ongoing and future clinical
trials will be successfully completed on a timely basis or at all
and whether the data from any of our trials will support approval,
validation and/or reimbursement for our products, the expected
timing for launch of our products in development, whether the data
for the hGH-CTP study in adults will support approval of a BLA, the
expected timing of commencing and concluding our clinical trials,
enrollment in clinical trials, and disclosure of results for the
trials, the timing of our regulatory submissions, our ability to
market and sell any of our products in development, expectations
about developing RAYALDEE for dialysis patients, our ability to
obtain broad reimbursement coverage for the 4Kscore test, increased
adoption rates for the 4Kscore, the recommendations expected for
the KDIGO guidelines, as well as other non-historical statements
about our expectations, beliefs or intentions regarding our
business, technologies and products, financial condition,
strategies or prospects. Many factors could cause our actual
activities or results to differ materially from the activities and
results anticipated in forward-looking statements. These factors
include those described in our Annual Reports on Form 10-K filed
and to be filed with the Securities and Exchange Commission and in
our other filings with the Securities and Exchange Commission, as
well as integration challenges for Bio-Reference, EirGen,
Transition, and other acquired businesses, the risks inherent in
funding, developing and obtaining regulatory approvals of new,
commercially-viable and competitive products and treatments, that
earlier clinical results of effectiveness and safety may not be
reproducible or indicative of future results, that the 4Kscore,
RAYALDEE, Varubi™, hGH-CTP, OPKO88003, OPK88004, and/or any of our
compounds or diagnostic products under development may fail, may
not achieve the expected results or effectiveness and may not
generate data that would support the approval or marketing of
products for the indications being studied or for other
indications, that currently available over-the-counter and
prescription products, as well as products under development by
others, may prove to be as or more effective than our products for
the indications being studied. In addition, forward-looking
statements may also be adversely affected by general market
factors, competitive product development, product availability,
federal and state regulations and legislation, the regulatory
process for new products and indications, manufacturing issues that
may arise, patent positions, government investigations and
litigation, among other factors. The forward-looking statements
contained in this press release speak only as of the date the
statements were made, and we do not undertake any obligation to
update forward-looking statements. We intend that all
forward-looking statements be subject to the safe-harbor provisions
of the PSLRA.
Company OPKO Health, Inc. Tara Mackay,
305-575-4100 Investor Relations or Media Rooney
& Partners Terry Rooney, 212-223-0689 trooney@rooneyco.com or
Marion Janic, 212-223-4017mjanic@rooneyco.com or
Investors LHA Anne Marie Fields, 212-838-3777
afields@lhai.com or Bruce Voss, 310-691-7100 bvoss@lhai.com
- Tables to
Follow -
OPKO Health, Inc. and SubsidiariesCondensed
Consolidated Balance Sheets(unaudited) (in millions) |
|
|
As of |
|
|
March 31, 2017 |
|
|
December 31, 2016 |
Assets: |
|
|
|
|
|
Cash,
cash equivalents and marketable securities |
|
$ |
131.1 |
|
|
$ |
168.7 |
Other
current assets |
|
|
328.8 |
|
|
|
314.9 |
Total Current
Assets |
|
|
459.9 |
|
|
|
483.6 |
In-process Research and
Development and Goodwill |
|
|
1,351.0 |
|
|
|
1,349.3 |
Other assets |
|
|
949.2 |
|
|
|
933.7 |
Total
Assets |
|
$ |
2,760.1 |
|
|
$ |
2,766.6 |
|
|
|
|
|
|
Liabilities and
Equity: |
|
|
|
|
|
Current
liabilities |
|
$ |
264.9 |
|
|
$ |
263.3 |
2033
Senior Notes, net |
|
|
39.3 |
|
|
|
43.7 |
Deferred
tax liabilities |
|
|
159.3 |
|
|
|
165.3 |
Other
long-term liabilities, principally deferred revenue and contingent
consideration |
|
|
189.6 |
|
|
|
202.5 |
Total
Liabilities |
|
|
653.1 |
|
|
|
674.8 |
Equity |
|
|
2,107.0 |
|
|
|
2,091.8 |
Total
Liabilities and Equity |
|
$ |
2,760.1 |
|
|
$ |
2,766.6 |
|
|
|
|
|
|
|
OPKO Health, Inc. and SubsidiariesCondensed
Consolidated Statements of Operations(unaudited)(in millions) |
|
|
For the three months ended March 31, |
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
Revenue
from services |
|
$ |
255.3 |
|
|
|
$ |
252.5 |
|
Revenue
from products |
|
|
22.2 |
|
|
|
|
19.9 |
|
Revenue
from transfer of intellectual property |
|
|
18.6 |
|
|
|
|
18.6 |
|
Total revenues |
|
|
296.1 |
|
|
|
|
291.0 |
|
Costs and
expenses |
|
|
|
|
|
Cost of
revenues |
|
|
154.8 |
|
|
|
|
147.5 |
|
Selling,
general and administrative |
|
|
136.7 |
|
|
|
|
128.0 |
|
Research
and development |
|
|
26.0 |
|
|
|
|
27.8 |
|
Contingent consideration |
|
|
2.4 |
|
|
|
|
1.8 |
|
Amortization of intangible assets |
|
|
17.9 |
|
|
|
|
13.4 |
|
Total
Costs and expenses |
|
|
337.8 |
|
|
|
|
318.5 |
|
Operating
(loss) income |
|
|
(41.7 |
) |
|
|
|
(27.5 |
) |
Other income and
(expense), net |
|
|
5.9 |
|
|
|
|
(2.6 |
) |
(Loss)
income before income taxes and investment losses |
|
|
(35.8 |
) |
|
|
|
(30.1 |
) |
(Provision for) benefit
from income taxes |
|
|
6.9 |
|
|
|
|
20.5 |
|
(Loss)
income before investment losses |
|
|
(28.9 |
) |
|
|
|
(9.6 |
) |
Loss from investments
in investees |
|
|
(2.1 |
) |
|
|
|
(2.4 |
) |
Net
(loss) income |
|
|
(31.0 |
) |
|
|
|
(12.0 |
) |
Basic and
diluted (loss) per share |
|
$ |
(0.06 |
) |
|
|
$ |
(0.02 |
) |
|
|
|
|
|
|
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