OPKO Health Reports 2017 Third Quarter Highlights and Financial Results
November 08 2017 - 4:05PM
OPKO Health, Inc. (NASDAQ:OPK), reports operating
and financial results for the three months ended September 30,
2017.
Business Highlights
- RAYALDEE commercial activities
continue to progress: Total prescriptions for
RAYALDEE, as reported by IMS, increased 66% during the three months
ended September 30, 2017 compared to the three months ended June
30, 2017. OPKO expanded its field based sales force from 35
to 71 as of October 1st. The commercial and medical science
liaison teams now total more than 80 professionals. In early
November 2017, OPKO participated in the American Society of
Nephrology meeting, the largest nephrology meeting of the year, and
presented four posters highlighting the impact of RAYADEE in Stage
3 and Stage 4 chronic kidney disease patients.
- Exclusive Agreement with Japan Tobacco (JT) to Develop
and Commercialize RAYALDEE in Japan: Under the terms
of the agreement, JT made an upfront payment to OPKO of $6 million
with another $6 million payment to be made upon initiation of
OPKO's planned phase 2 study of RAYALDEE in U.S. dialysis patients.
In addition, OPKO will be eligible to receive up to an additional
$31 million in development and regulatory milestones and $75
million in sales based milestones. JT will also pay OPKO tiered,
double-digit royalties on net product sales. JT will be responsible
for all regulatory approvals and commercial activities pertaining
to RAYALDEE in Japan. According to JT, an estimated 13.3
million people in Japan have CKD and more than 300,000 are
undergoing dialysis, with both patient populations increasing due
to the aging population.
- 4Kscore® utilization increased 19% in
Q3 2017 compared with Q3 2016: OPKO has undertaken a
number of initiatives to drive utilization of the 4Kscore test, the
Company’s blood test that gives a man with elevated PSA levels a
personalized prediction of his chance of having or developing an
aggressive form of prostate cancer. In addition to developing
a small urology-focused sales force to complement BioReference
Laboratories’ efforts, OPKO will launch regional television ads in
the Northeast for the 4Kscore test beginning on November 21,
2017.
- PMA filing for Claros PSA test submitted November 6,
2017; Claros POC testosterone test trials and 510(k) filing
expected to follow in 2018: OPKO completed its analytic
and clinical validation studies and submitted a PMA for a PSA test
utilizing the Claros 1 immunoassay analyzer, a novel diagnostic
instrument that can provide rapid, quantitative blood test results
in 10 minutes in the physician’s office with only a finger stick
drop of whole blood. OPKO expects to begin an additional
multi-center study of its POC testosterone test in 2018 followed by
a 510(k) submission to the FDA.
- Global pediatric Phase 3 hGH-CTP in 220 growth hormone
deficient children is underway and we continue enrolling
patients: This is a pivotal, non-inferiority study
comparing a single weekly dose of hGH-CTP with daily injections of
a currently marketed growth hormone. A registration trial in
pediatric patients is also underway in Japan. These studies
are using the to-be-marketed pen device and formulation that will
be launched commercially upon approval. The pediatric segment
represents approximately 80% of the commercial market for treatment
of hGH deficiency.
- Phase 2a trial for intravenously administered Factor
VII-CTP and Phase 1 trial for subcutaneously administered Factor
VII-CTP ongoing: These long acting forms of Factor
VII utilizing OPKO’s CTP technology are expected to better support
prophylaxis to prevent bleeding episodes, provide easier
administration and decrease dosing frequency for hemophilia
patients.
- Initiation of four Phase 2 clinical trials anticipated
in late 2017 and early 2018
- RAYALDEE line extension in dialysis
patients with secondary hyperparathyroidism (SHPT):
Together with its partner, Vifor Fresenius, OPKO is developing
RAYALDEE for Stage 5 chronic kidney disease (CKD) patients with
SHPT undergoing dialysis and anticipates initiating a Phase 2 trial
shortly in dialysis centers around the country and abroad.
- OPK88004, orally administered selective androgen
receptor modulator (SARM): OPKO plans to initiate a Phase
2b dose ranging study in Q4 2017 to evaluate its use to treat men
with benign prostatic hypertrophy (BPH). It is expected to
improve symptoms of BPH by reducing prostate size and, on the basis
of data from a previous trial in 350 men, increase muscle mass and
bone strength and decrease fat mass. BPH affects
approximately 50 million men in the U.S.
- OPK88003, once weekly oxyntomodulin dual GLP1-Glucagon
agonist for type 2 diabetes and obesity: In a 420
patient phase 2 diabetes trial, OPK88003 treatment reduced
HbA1c levels to a similar extent as Exenetide Extended Release (Ex
ER). The drug also showed statistically significantly greater
weight loss, and lowering of cholesterol and triglycerides compared
to once weekly Ex ER. The drug has a good safety profile and is
expected to enter a phase 2b dose escalation study in early
2018.
- OPK88002, NK-1 antagonist 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
approved and plans are now being finalized to begin a single dose
Phase 2a trial of OPK88002.
Financial Highlights
- Consolidated revenues for the three months ended September 30,
2017 were $263.5 million compared to $298.0 million for the
comparable period of 2016.
- During the three months ended September 30, 2017, operating
expenses included significant investment in the commercial
activities supporting the launch of RAYALDEE of $8.3 million,
as well as continued investment in the Company’s
pharmaceutical pipeline with R&D expense increasing to $32.3
million.
- Cash, cash equivalents and marketable securities were $100.3
million as of September 30, 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: Wednesday, November 8, 2017 at 4:30 p.m.
Eastern time. DOMESTIC DIAL-IN: (866)
634-2258
INTERNATIONAL DIAL-IN: (330)
863-3454 PASSCODE:
8399217 WEBCAST: http://investor.opko.com/events.cfm
The replay can also be accessed for a period of time on OPKO’s
website at www.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 BioReference
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 recently
approved by the FDA), OPK88003, a once-weekly oxyntomodulin for
type 2 diabetes and obesity that is a clinically advanced drug
candidate among the new class of GLP-1 glucagon receptor dual
agonists, and OPK88004, a selective androgen receptor modulator
being developed for benign prostatic hypertrophy and other urologic
and metabolic conditions. 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 various production and
distribution assets abroad, multiple strategic investments and an
active business development strategy. More information is 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 the
market for and sales of our products, whether 4Kscore test
utilization and prescriptions for RAYALDEE will continue to
increase, 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 submission
or approval, validation and/or reimbursement for our products, the
expected timing for launch of our products in development,
including Varubi®, the expected timing of commencing and concluding
our clinical trials, including studies for the testosterone POC
test and whether we will commence four Phase 2 clinical programs in
2017 or early 2018, 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, and whether we will receive milestone and royalty
payments from JT, 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 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. David Malina,
305-575-4100 Investor Relations
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 |
|
September 30, 2017 |
|
December 31, 2016 |
Assets: |
|
|
|
Cash, cash
equivalents and marketable securities |
$ |
100.3 |
|
$ |
168.7 |
Other current
assets |
|
330.2 |
|
|
314.9 |
Total Current
Assets |
|
430.5 |
|
|
483.6 |
In-process Research and
Development and Goodwill |
|
1,364.0 |
|
|
1,349.3 |
Other assets |
|
927.5 |
|
|
933.7 |
Total
Assets |
$ |
2,722.0 |
|
$ |
2,766.6 |
|
|
|
|
Liabilities and
Equity: |
|
|
|
Current
liabilities |
$ |
259.0 |
|
$ |
263.3 |
2033 Senior
Notes, net of discount |
|
28.6 |
|
|
43.7 |
Deferred tax
liabilities |
|
118.8 |
|
|
165.3 |
Other long-term
liabilities, principally deferred revenue and contingent
consideration |
|
226.6 |
|
|
202.5 |
Total
Liabilities |
|
633.0 |
|
|
674.8 |
Equity |
|
2,089.0 |
|
|
2,091.8 |
Total
Liabilities and Equity |
$ |
2,722.0 |
|
$ |
2,766.6 |
|
|
|
|
|
OPKO Health, Inc. and SubsidiariesCondensed
Consolidated Statements of Operations(unaudited)(in millions,
except share and per share data) |
|
|
For the three months endedSeptember 30, |
|
For the nine months ended September 30, |
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
Revenue from
services |
$ |
229.0 |
|
|
$ |
259.0 |
|
|
$ |
741.0 |
|
|
$ |
777.6 |
|
Revenue from
products |
|
22.8 |
|
|
|
20.6 |
|
|
|
74.0 |
|
|
|
63.3 |
|
Revenue from
transfer of intellectual property |
|
11.7 |
|
|
|
18.4 |
|
|
|
58.8 |
|
|
|
105.3 |
|
Total
revenues |
|
263.5 |
|
|
|
298.0 |
|
|
|
873.8 |
|
|
|
946.2 |
|
Costs and expenses |
|
|
|
|
|
|
|
Cost of
revenues |
|
151.3 |
|
|
|
151.2 |
|
|
|
463.5 |
|
|
|
452.2 |
|
Selling, general
and administrative |
|
131.4 |
|
|
|
124.9 |
|
|
|
396.3 |
|
|
|
370.3 |
|
Research and
development |
|
32.3 |
|
|
|
24.4 |
|
|
|
91.0 |
|
|
|
83.6 |
|
Contingent
consideration |
|
(11.2 |
) |
|
|
3.1 |
|
|
|
(4.5 |
) |
|
|
15.6 |
|
Amortization of
intangible assets |
|
18.0 |
|
|
|
18.1 |
|
|
|
53.9 |
|
|
|
47.3 |
|
Total Costs and
expenses |
|
321.8 |
|
|
|
321.7 |
|
|
|
1,000.2 |
|
|
|
969.0 |
|
Operating
loss |
|
(58.3 |
) |
|
|
(23.7 |
) |
|
|
(126.4 |
) |
|
|
(22.8 |
) |
Other income and
(expense), net |
|
(8.5 |
) |
|
|
(10.5 |
) |
|
|
0.9 |
|
|
|
(8.1 |
) |
Loss before
income taxes and investment losses |
|
(66.8 |
) |
|
|
(34.2 |
) |
|
|
(125.5 |
) |
|
|
(30.9 |
) |
Income tax benefit |
|
24.4 |
|
|
|
20.0 |
|
|
|
42.3 |
|
|
|
24.6 |
|
Loss before
investment losses |
|
(42.4 |
) |
|
|
(14.2 |
) |
|
|
(83.2 |
) |
|
|
(6.3 |
) |
Loss from investments
in investees |
|
(4.0 |
)) |
|
|
(0.8 |
) |
|
|
(11.8 |
) |
|
|
(5.1 |
) |
Net loss |
$ |
(46.4 |
) |
|
$ |
(15.0 |
) |
|
$ |
(95.0 |
) |
|
$ |
(11.4 |
) |
Loss per share, basic
and diluted: |
|
|
|
|
|
|
|
Loss per
share |
$ |
(0.08 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.17 |
) |
|
$ |
(0.02 |
) |
Weighted average common
shares outstanding, basic and diluted |
|
559,405,309 |
|
|
|
552,229,266 |
|
|
|
559,065,232 |
|
|
|
548,550,641 |
|
|
|
|
|
|
|
|
|
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