SAN DIEGO, Feb. 24, 2020
/PRNewswire/ -- Halozyme Therapeutics, Inc. (NASDAQ: HALO) today
reported financial results for the fourth quarter and full year
ended December 31, 2019 and provided
an update on its recent corporate activities and outlook.
"I am pleased to report 2020 is off to a strong start as we have
substantially completed our actions to reposition the company to
focus on ENHANZE®," said Dr. Helen Torley, president and chief executive
officer. "As a result of our decisive actions, we expect to become
sustainably profitable in the second quarter. In addition, we
anticipate multiple events that will grow the value of our
ENHANZE® technology in 2020. Both the subcutaneous
formulation of Darzalex® and the fixed-dose combination
of Perjeta®-Herceptin® are under regulatory
review in the U.S. and EU with potential approvals and launches
expected this year. We anticipate three ENHANZE®
pipeline candidates to begin Phase 3 testing, one to begin Phase 2,
and at least five new Phase 1 trial starts. With these key
developments, a transition to profitability and plans for continued
return of capital, Halozyme has never been in a stronger position
to deliver value for our shareholders. With a target of 19 products
in clinical development or already commercialized by the end of
this year, we continue to see the potential for our royalty
revenues to achieve $1 billion by
2027."
Fourth Quarter 2019 and Recent Highlights
- In December, Janssen selected for development with
ENHANZE® the targets EGFR and cMET on an exclusive basis
as part of the bispecific antibody (JNJ-61186372), which is being
studied in solid tumors.
- Halozyme recently completed $200
million worth of share repurchases under the Board of
Directors authorized capital return program to repurchase up to
$550 million of the Company's
outstanding common stock over the next three years. This repurchase
plan was first authorized by the Board of Directors in November 2019 and has $350
million remaining under the authorization. The Company plans
to repurchase up to an additional $150M worth of shares in 2020.
- In November 2019, Halozyme
completed the sale of $460.0 million
aggregate principal amount of Convertible Senior Notes due 2024. A
portion of the net proceeds from the offering were used to
repurchase $200 million of the
Company's stock and $26.1 million to
repay all outstanding amounts under loan agreements with Oxford
Finance and Silicon Valley Bank.
- In November 2019, Halozyme
announced strategic actions to reposition the Company with a focus
on its ENHANZE® drug delivery technology and immediately
implemented a restructuring following the announcement of results
of the HALO-301 clinical study. Since then, the Company has
completed the majority of the restructuring and remains on track to
become a sustainably profitable company beginning in the second
quarter of 2020.
- In October 2019, collaboration
partner Roche nominated one new undisclosed target to be studied
utilizing the ENHANZE® technology, triggering a
$10 million milestone payment to
Halozyme.
- In October 2019, collaboration
partner Bristol-Myers Squibb initiated a Phase 1 study of
relatlimab in combination with nivolumab utilizing the
ENHANZE® technology.
Fourth Quarter and Full
Year 2019 Financial Highlights
- Revenue for the fourth quarter was $53.7
million compared to $60.2
million for the fourth quarter of 2018. The year-over-year
decrease was primarily driven by a $25
million upfront payment from Roche in the year ago period
2018 related to the expansion of Roche's collaboration with
Halozyme, partially offset by higher API sales to our partners in
the current period. Revenue for the quarter included $17.2 million in royalties, which compared to
$19.3 million in the prior year
period.
Total revenues for the full year were $196.0
million, compared with $151.9
million in 2018, representing growth of 29% year over
year.
- Research and development expenses for the fourth quarter were
$45.1 million, compared to
$36.7 million for the fourth quarter
of 2018. The increase in expenses was due to $17.2 million in restructuring and one-time
charges related to the shift in strategic focus to the Company's
ENHANZE® drug delivery technology, partially offset by
$9.4 million lower PEGPH20 clinical
trial related costs.
Research and development expenses for the full year were
$140.8 million, compared with
$150.3 million in 2018.
- Selling, general and administrative expenses for the fourth
quarter were $23.9 million, compared
to $18.0 million for the fourth
quarter of 2018. The increase was due to restructuring and
other one-time charges of $11.2
million, partially offset by lower personnel costs.
Selling, general and administrative expenses for the full year were
$77.3 million, compared with
$60.8 million in 2018.
- Net loss for the fourth quarter was $34.4 million, or 0.24 per share, compared to a
net loss in the fourth quarter of 2018 of $2.1 million, or $0.01 per share.
Net loss for the full year was $72.2
million or $0.50 per share,
compared to $80.3 million or
$0.56 per share in 2018.
- Cash, cash equivalents and marketable securities were
$421.3 million at December 31, 2019, compared to $354.5 million at December
31, 2018.
Financial Outlook for 2020
Halozyme is reiterating its 2020 financial guidance
ranges as first announced on January 14,
2020. For 2020, Halozyme expects:
- Revenues of $230 million to
$245 million, representing growth of
17% to 25%;
- Earnings per share on a GAAP basis of $0.60 to $0.75 with
the first quarter of sustainable profitability beginning in Q2
2020.
The guidance for earnings per share does not reflect
any potential impact from the Company's plans
to repurchase an additional number of shares, up
to $150 million worth, during 2020. The amount
and timing of shares repurchased during 2020
will be subject to a variety of
factors including market conditions, other business
considerations and applicable legal requirements.
Webcast and Conference Call
Halozyme will webcast its Quarterly Update Conference Call
for the fourth quarter of 2019
today, Monday, February 24, 2020 at 4:30 p.m. ET/1:30 p.m. PT. Dr. Torley will lead the call, which will be
webcast live through the "Investors" section of
Halozyme's corporate website and a replay will
be available following the close of
the call. To access the webcast and additional
documents related to the call, please
visit halozyme.com approximately
fifteen minutes prior
to the call to register, download
and install any necessary audio
software. The call may also be accessed by
dialing (877) 824-0907 (domestic callers) or
(647) 689-5655
(international callers). A telephone replay will
be available after the call by dialing
(800) 585-8367 (domestic callers) or
(416) 621-4642
(international callers) using replay ID number
1266162.
About Halozyme
Halozyme Therapeutics is a biotechnology
company focused on novel biological and drug
delivery approaches. Halozyme's proprietary enzyme
rHuPH20 is used to facilitate the delivery of
injected drugs and fluids and potentially
reduce the treatment burden of other drugs
to patients. Halozyme has licensed its
rHuPH20 technology, called ENHANZE®, to leading
pharmaceutical and biotechnology companies including
Roche, Baxalta, Pfizer, Janssen, AbbVie, Lilly,
Bristol-Myers Squibb, Alexion and argenx.
Halozyme derives
revenues from these collaborations in
the form of milestones and royalties as
the Company's partners make progress developing and
commercializing their products being developed with
ENHANZE®. Halozyme is headquartered in San Diego.
For more information visit
www.halozyme.com.
Safe Harbor Statement
In addition to historical information, the statements set forth
in this press release include forward-looking statements including,
without limitation, statements concerning the Company's expected
future financial performance (including the Company's financial
outlook for 2020) and expectations for profitability, revenue,
expenses and earnings-per-share and the Company's plans to continue
its share repurchase program. Forward-looking statements
regarding the Company's ENHANZE® drug delivery
technology may include the possible activity, benefits and
attributes of ENHANZE®, the possible method of action of
ENHANZE®, its potential application to aid in the
dispersion and absorption of other injected therapeutic drugs and
facilitating more rapid delivery of injectable medications through
subcutaneous delivery. Forward-looking statements regarding
the Company's ENHANZE® business may include potential
growth driven by our partners' development and commercialization
efforts, potential new ENHANZE® collaborations and
collaborative targets and regulatory review and potential approvals
of new ENHANZE® products. These 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 and involve risk and uncertainties that could cause
actual results to differ materially from those in the
forward-looking statements. Actual results could differ
materially from the expectations contained in these forward-looking
statements as a result of several factors, including unexpected
levels of revenues, expenditures and costs, unexpected delays in
the execution of the Company's share repurchase program, unexpected
results or delays in the growth of the Company's
ENHANZE® business or in the development, regulatory
review or commercialization of ENHANZE® products,
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 most
recently filed Annual Report on Form 10-K filed with the Securities
and Exchange Commission.
Contact:
Al Kildani
Vice President, Investor Relations and Corporate
Communications
858-704-8122
ir@halozyme.com
Halozyme
Therapeutics, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share
amounts)
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
2019
|
2018
|
|
2019
|
2018
|
Revenues:
|
|
|
|
|
|
Royalties
|
$
17,230
|
$
19,338
|
|
$
69,899
|
$
78,981
|
Product sales, net
|
22,693
|
10,681
|
|
66,048
|
28,234
|
Revenues under collaborative agreements
|
13,742
|
30,213
|
|
60,045
|
44,647
|
Total revenues
|
53,665
|
60,232
|
|
195,992
|
151,862
|
Operating expenses:
|
Cost of product sales
|
16,688
|
5,622
|
|
45,547
|
10,136
|
Research and development
|
45,111
|
36,650
|
|
140,804
|
150,252
|
Selling, general and administrative
|
23,929
|
18,031
|
|
77,252
|
60,804
|
Total operating expenses
|
85,728
|
60,303
|
|
263,603
|
221,192
|
Operating loss
|
(32,063)
|
(71)
|
|
(67,611)
|
(69,330)
|
Other income (expense):
|
|
|
|
|
|
Investment and other income, net
|
1,333
|
2,017
|
|
6,986
|
7,578
|
Interest expense
|
(3,731)
|
(3,755)
|
|
(11,627)
|
(18,041)
|
Net loss before income taxes
|
(34,461)
|
(1,809)
|
|
(72,252)
|
(79,793)
|
Income tax expense
|
(63)
|
317
|
|
(11)
|
537
|
Net loss
|
$
(34,398)
|
$
(2,126)
|
|
$
(72,241)
|
$
(80,330)
|
Net loss per share:
|
|
|
|
|
|
Basic and diluted
|
$
(0.24)
|
$
(0.01)
|
|
$
(0.50)
|
$
(0.56)
|
Diluted
|
$
(0.24)
|
$
(0.01)
|
|
$
(0.50)
|
$
(0.56)
|
|
Shares used in computing net loss per share:
|
|
Basic and diluted
|
141,046
|
144,203
|
|
144,329
|
143,599
|
Diluted
|
141,046
|
144,203
|
|
144,329
|
143,599
|
Halozyme
Therapeutics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
|
|
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
ASSETS
|
|
|
|
Current assets:
|
|
|
|
Cash and cash equivalents
|
$
120,179
|
|
$
57,936
|
Marketable securities, available-for-sale
|
301,083
|
|
296,590
|
Accounts receivable, net
|
59,442
|
|
30,005
|
Inventories
|
29,359
|
|
22,625
|
Prepaid expenses and other assets
|
33,373
|
|
20,693
|
Total current assets
|
543,436
|
|
427,849
|
Property and equipment, net
|
10,855
|
|
7,465
|
Prepaid expenses and other assets
|
11,083
|
|
4,434
|
Restricted cash
|
500
|
|
500
|
Total assets
|
$
565,874
|
|
$
440,248
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts payable
|
$
6,434
|
|
$
4,079
|
Accrued expenses
|
55,649
|
|
49,529
|
Deferred revenue, current portion
|
4,012
|
|
4,247
|
Current portion of long-term debt, net
|
19,542
|
|
91,506
|
Total current liabilities
|
85,637
|
|
149,361
|
Deferred revenue, net of current portion
|
1,247
|
|
5,008
|
Long-term debt, net
|
383,045
|
|
34,874
|
Other long-term liabilities
|
4,180
|
|
2,118
|
Stockholders' equity:
|
|
|
|
Common stock
|
137
|
|
145
|
Additional paid-in capital
|
695,066
|
|
780,457
|
Accumulated other comprehensive income (loss)
|
240
|
|
(277)
|
Accumulated deficit
|
(603,678)
|
|
(531,438)
|
Total stockholders' equity
|
91,765
|
|
248,887
|
Total liabilities and stockholders' equity
|
$
565,874
|
|
$
440,248
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/halozyme-reports-fourth-quarter-and-full-year-2019-results-301010090.html
SOURCE Halozyme Therapeutics, Inc.