Keryx Biopharmaceuticals, Inc. (Nasdaq:KERX), a biopharmaceutical
company focused on bringing innovative medicines to people with
renal disease, today announced its financial results for the
quarter ended June 30, 2017. The company also reviewed its
commercial progress with Auryxia and upcoming milestones.
“Our second quarter results reflect continued
strong Auryxia prescription demand,” said Greg Madison, president
and chief executive officer of Keryx. “This demand was largely
driven by solid execution across our entire field team, which
increased both breadth and depth of prescribing among physicians.
With this momentum, we have increased our annual net Auryxia
product sales guidance, reflecting improved confidence in our
ability to bring this medicine to a greater number of people with
chronic kidney disease (CKD) on dialysis this year.”
Mr. Madison continued, “We are equally excited
about the opportunity to potentially add a second indication for
Auryxia for the treatment of iron deficiency anemia in people with
non-dialysis dependent chronic kidney disease. Iron deficiency
anemia is a serious disease and, today, as many as three out of
four people with CKD and iron deficiency anemia are not being
optimally treated with existing iron supplements. Our team is
working diligently to ensure that we are prepared, pending FDA
approval in early November, for a successful launch in this
indication. I believe the progress we are making in dialysis
coupled with the large opportunity to treat iron deficiency anemia
form a strong foundation from which to build a leading renal
company.”
SECOND QUARTER 2017 FINANCIAL RESULTS
AND RECENT BUSINESS HIGHLIGHTS
Auryxia Commercial Progress
- Keryx reported second quarter 2017 net U.S. Auryxia product
sales of $14.1 million compared to $8.3 million in the second
quarter of 2016, an increase of 71 percent.
- Auryxia prescription demand was strong in the second quarter of
2017, with approximately 21,100 prescriptions written. This
compares to approximately 13,150 prescriptions in the second
quarter of 2016, an increase of 61 percent.
- Auryxia was added to Medicare Part D formularies at two of the
largest Medicare Part D insurance providers, which results in
cumulative unrestricted access to approximately 95 percent of
patients on a phosphate binder across Medicare Part D and
commercial providers.
Potential Label Expansion Opportunity
- A supplemental new drug application seeking approval of Auryxia
for the treatment of patients with iron deficiency anemia and
non-dialysis dependent CKD is currently under review, with a
November 6, 2017 PDUFA action date. If approved for this
indication, Keryx will have two indications for Auryxia to leverage
its commercial infrastructure, as well as the broad patient access,
familiarity and relationships established to date in treating
hyperphosphatemia.
Business Update
- Keryx announced today that during the second quarter it
completed the sale of common stock under its previously filed
“at-the-market” (ATM) offering, resulting in $73.1 million in net
proceeds, $68.0 million of which was sold during the second
quarter.
Second Quarter June 30, 2017 Financial
Results“The second quarter, highlighted by reported strong
demand and sales of Auryxia, gives us the confidence to raise
Auryxia’s 2017 net product sales guidance to $62 to $66 million,”
said Scott Holmes, senior vice president and chief financial
officer of Keryx Biopharmaceuticals. “Additionally, the capital
raised via the ATM strengthens our balance sheet and provides us
with the financial flexibility to continue to appropriately invest
in our business to support our anticipated growth.”
Total revenues for the quarter
ended June 30, 2017 were $15.1 million, compared with $9.3 million
during the same period in 2016. Total revenues for the second
quarter of 2017 include $14.1 million in net U.S. Auryxia product
sales, compared to $8.3 million in the second quarter of 2016.
Total revenues also include $1.0 million in license revenue during
the second quarters of 2017 and 2016.
Cost of goods sold for the
quarter ended June 30, 2017 were $4.4 million, compared with $5.1
million during the same period in 2016.
Selling, general and administrative
expenses for the quarter ended June 30, 2017 were $25.0
million, as compared to $20.2 million during the same period in
2016. The increase was related to the continued commercialization
of Auryxia, and preparations for Auryxia’s potential launch in iron
deficiency anemia later this year.
Research and development
expenses for the quarter ended June 30, 2017 were $9.0
million, as compared to $7.0 million during the same period in
2016. The increase was primarily related to manufacturing and
clinical activities to support the long-term growth of Auryxia.
Net loss for the quarter ended
June 30, 2017 was $86.5 million, or $0.77 per share, compared to a
net loss of $44.7 million, or $0.42 per share, for the comparable
period in 2016. The increase in net loss is attributable to the
recognition of $63.0 million of non-cash debt discount amortization
related to the company’s outstanding convertible debt. This
amortization expense is not expected to recur in future
periods.
Cash and cash equivalents as of
June 30, 2017 totaled $140.5 million compared to $111.8 million as
of December 31, 2016.
2017 Financial GuidanceThis
section contains forward-looking guidance about the financial
outlook for Keryx Biopharmaceuticals.
Keryx today increased its financial guidance for
full year 2017 net U.S. Auryxia product sales to $62 to $66 million
from $56 to $60 million, as provided on May 4, 2017. The guidance
is based on the company’s current understanding of Auryxia
prescriptions trends in dialysis and other financial factors.
Guidance excludes any sales from the potential approval in November
2017 of the second indication for ferric citrate in the U.S.
Conference Call Information
Keryx will host an investor conference call today, Thursday, July
27, 2017, at 8:00 a.m. ET to discuss financial results for the
second quarter of 2017. To participate in the conference call,
please call 1-(888) 396-2320 (U.S.), 1-(774) 264-7560 (outside the
U.S.), call-in ID: 47371058. The call will also be webcast with
slides, which will be accessible through the Investors section of
the company's website at www.keryx.com. The audio replay will be
available at http://www.keryx.com for approximately 15 days after
the call.
About Iron Deficiency Anemia,
NDD-CKDIron deficiency anemia (IDA) is a common
complication in patients with non-dialysis dependent chronic kidney
disease (NDD-CKD), and the prevalence and severity of IDA increases
as kidney disease progresses. Today, there are no FDA approved oral
irons for the treatment of IDA in CKD patients and the efficacy and
tolerability of current oral iron supplements are mixed. The
company estimates that of the 1.7 million Americans with CKD under
the care of a nephrologist, approximately 650,000 people are
treated for IDA and another 250,000 – 400,000 people could have IDA
but are not treated today.
About Auryxia Auryxia (ferric
citrate) was approved by the U.S. Food and Drug Administration on
September 5, 2014 and is indicated in the U.S. for the control of
serum phosphorus levels in patients with CKD on dialysis. The U.S.
approval of Auryxia was based on data from the company's Phase 3
registration program in dialysis patients. In the Phase 3 clinical
trials, Auryxia effectively reduced serum phosphorus levels to
within the KDOQI guidelines range of 3.5 to 5.5 mg/dL.
Auryxia binds with dietary phosphate in the GI
tract and precipitates as ferric phosphate. The unbound portion of
Auryxia has been shown to increase serum iron parameters including
ferritin and transferrin saturation (TSAT). Iron absorption from
Auryxia may lead to excessive elevations in iron stores.
Accordingly, physicians should assess and monitor iron parameters
before starting and while on Auryxia, and may need to decrease or
discontinue IV iron for these patients. The most common adverse
events for Auryxia treated patients were gastrointestinal related,
including diarrhea, nausea, vomiting and constipation. For more
information about Auryxia and the U.S. full prescribing
information, visit www.Auryxia.com.
Use of ferric citrate in patients with IDA,
NDD-CKD, as highlighted above, is investigational and has not been
determined to be safe or efficacious.
IMPORTANT U.S. SAFETY INFORMATION FOR
AURYXIA® (ferric
citrate)Contraindication: Patients
with iron overload syndrome, e.g. hemochromatosis, should not take
Auryxia®.
Iron Overload: Iron
absorption from Auryxia may lead to increased iron in storage
sites. Iron parameters should be monitored prior to and while
on Auryxia. Patients receiving IV iron may require a reduction in
dose or discontinuation of IV iron therapy.
Accidental Overdose of
Iron: Accidental overdose of iron containing products
is a leading cause of fatal poisoning in children under 6 years of
age. Keep Auryxia away from children as it contains
iron. Call a poison control center or your physician in case
of an accidental overdose in a child.
Patients with Gastrointestinal Bleeding
or Inflammation: Safety has not been established for
these patients.
Adverse Events: The most
common adverse events with Auryxia were diarrhea (21%), nausea
(11%), constipation (8%), vomiting (7%) and cough
(6%). Gastrointestinal adverse reactions were the most common
reason for discontinuing Auryxia (14%). Auryxia contains iron and
may cause dark stools, which is considered normal with oral
medications containing iron.
Drug
Interactions: Doxycycline should be taken at least 1
hour before Auryxia. Ciprofloxacin should be taken at least 2
hours before or after Auryxia.
For Full Prescribing Information for Auryxia,
please
visit http://auryxia.com/important-safety-information/
| Keryx Biopharmaceuticals, Inc. |
| Condensed Consolidated Statements of
Operations |
| (In thousands, except share and per share
amounts) |
| (unaudited) |
| |
| |
|
Three Months EndedJune
30 |
Six Months EndedJune
30 |
| |
|
|
|
| |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
2016 |
|
|
|
Revenues: |
|
|
|
|
|
|
Net U.S. Auryxia product sales |
$ |
14,116 |
|
$ |
8,279 |
|
$ |
24,621 |
|
$ |
13,895 |
|
|
|
License revenue |
|
1,028 |
|
|
1,009 |
|
|
2,343 |
|
2,218 |
|
|
|
Total Revenues |
|
15,144 |
|
|
9,288 |
|
|
26,964 |
|
16,113 |
|
|
|
|
|
|
|
|
|
|
Costs and Expenses: |
|
|
|
|
|
| Cost
of goods sold |
|
4,379 |
|
|
5,099 |
|
|
8,653 |
|
6,170 |
|
|
|
Selling, general and administrative |
|
24,986 |
|
|
20,188 |
|
|
48,089 |
|
40,997 |
|
|
|
Research and development |
|
9,012 |
|
|
7,029 |
|
|
15,776 |
|
14,645 |
|
|
|
License expenses |
|
617 |
|
|
605 |
|
|
1,406 |
|
1,331 |
|
|
|
Total Costs and Expenses |
|
38,994 |
|
|
32,921 |
|
|
73,924 |
|
63,143 |
|
|
| |
|
|
|
|
|
|
Operating Loss |
|
(23,850 |
) |
|
(23,633 |
) |
|
(46,960 |
) |
(47,030 |
) |
|
| |
|
|
|
|
|
|
Other Income (Expense): |
|
|
|
|
|
|
Amortization of debt discount |
|
(62,965 |
) |
|
(18,479 |
) |
|
(62,965 |
) |
(34,226 |
) |
|
| Other
income (expense), net |
|
338 |
|
|
(2,519 |
) |
|
452 |
|
(4,319 |
) |
|
|
Total Other Income (Expense) |
|
(62,627 |
) |
|
(20,998 |
) |
|
(62,513 |
) |
(38,545 |
) |
|
|
|
|
|
|
|
|
|
Loss Before Income Taxes |
|
(86,477 |
) |
|
(44,631 |
) |
|
(109,473 |
) |
(85,575 |
) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Income
taxes |
|
20 |
|
|
20 |
|
|
40 |
|
40 |
|
|
| Net
Loss |
$ |
(86,497 |
) |
$ |
(44,651 |
) |
$ |
(109,513 |
) |
$ |
(85,615 |
) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net
Loss Per Common Share |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic and
diluted net loss per common share |
$ |
(0.77 |
) |
$ |
(0.42 |
) |
$ |
(1.00 |
) |
$ |
(0.81 |
) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares Used in Computing Net Loss Per Common
Share |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic and
diluted |
|
112,590,188 |
|
|
105,842,030 |
|
|
109,846,152 |
|
|
105,745,800 |
|
|
| Selected Consolidated Balance Sheets
Data |
| (In thousands) |
| (unaudited) |
| |
| |
June 30, 2017 |
|
December 31, 2016 |
|
Assets |
|
|
|
| Cash and cash
equivalents |
$ |
140,527 |
|
$ |
111,810 |
|
| Accounts
receivable |
$ |
8,459 |
|
$ |
5,236 |
|
| Inventory |
$ |
18,085 |
|
$ |
12,681 |
|
| Total assets |
$ |
184,189 |
|
$ |
141,427 |
|
|
|
|
|
|
| Liabilities and
Stockholders’ Equity (Deficit) |
|
|
|
| Accounts payable and
accrued expenses |
$ |
30,146 |
|
$ |
21,190 |
|
| Convertible senior
notes |
$ |
125,000 |
|
$ |
125,000 |
|
| Total liabilities |
$ |
158,540 |
|
$ |
149,723 |
|
| Stockholders’ equity
(deficit) |
$ |
25,649 |
|
$ |
(8,296 |
) |
Forward-Looking Statements Some of the
statements included in this press release, particularly those
regarding the commercialization and ongoing clinical development of
Auryxia, our updated 2017 financial guidance and the submission of
an sNDA to the FDA to expand the label of ferric citrate
to include the treatment of IDA in adults with stage 3-5 NDD-CKD
and the potential approval in this indication and the impact
thereof on Keryx, may be forward-looking statements that involve a
number of risks and uncertainties. For those statements, we claim
the protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995.
Among the factors that could cause our actual results to differ
materially are the following: whether we can increase adoption of
Auryxia in patients with CKD on dialysis in order to achieve our
2017 financial guidance; whether we can maintain our operating
expenses to projected levels while continuing our current clinical,
regulatory and commercial activities; the risk that
the FDA may not concur with our interpretation of our
Phase 3 study results in NDD- CKD, supportive data, conduct of the
studies, or any other part of our regulatory submission and could
ultimately deny approval of ferric citrate for the treatment of IDA
in adults with stage 3-5 NDD-CKD; the risk that if approved for use
in NDD-CKD that we may not be able to successfully market Auryxia
for use in this indication; our ability to continue to supply
Auryxia to the market; and other risk factors identified from time
to time in our reports filed with the Securities and Exchange
Commission. Any forward looking statements set forth in this press
release speak only as of the date of this press release. We do not
undertake to update any of these forward looking statements to
reflect events or circumstances that occur after the date hereof.
This press release and prior releases are available
at http://www.keryx.com. The information found on our website
is not incorporated by reference into this press release and is
included for reference purposes only.
About Keryx Biopharmaceuticals, Inc.Keryx
Biopharmaceuticals, Inc., with headquarters in Boston,
Massachusetts, is a commercial stage company focused on bringing
innovative medicines to people with renal disease. Keryx developed
and commercializes Auryxia® (ferric citrate), an iron-based
phosphate binder, in the U.S. Ferric citrate is marketed as
Riona® by Keryx’s Japanese partner, Japan Tobacco Inc. and
Torii Pharmaceutical Co. Ltd. In September 2015, the European
Commission granted European market authorization for Fexeric®
(ferric citrate coordination complex). Keryx has programs
underway to leverage its development and commercial infrastructure,
including evaluation of ferric citrate as a treatment for iron
deficiency anemia in adults with non-dialysis dependent
chronic kidney disease and in-licensing medicines for renal
disease. For more information about Keryx, please
visit www.keryx.com.
KERYX BIOPHARMACEUTICALS CONTACTS:
Amy Sullivan
Senior Vice President, Corporate Affairs
T: 617.466.3519
amy.sullivan@keryx.com
Lora Pike
Senior Director, Investor Relations & Corporate Communications
T: 617.466.3511
lora.pike@keryx.com
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