OPKO Health Reports 2020 Third Quarter Business Highlights and Financial Results
October 29 2020 - 04:05PM
OPKO Health, Inc. (NASDAQ: OPK) reports business
highlights and financial results for the three months ended
September 30, 2020.
Third Quarter
Business Highlights
- BioReference
Laboratories’ COVID-19
PCR testing
volume increased
61% over the
second quarter of
2020. During the third quarter,
BioReference Laboratories (BRL) processed approximately 3.5 million
COVID-19 PCR tests and currently has the capacity to process more
than 70,000 tests per day. In addition, the laboratory performed
approximately 300,000 COVID-19 serology tests to measure SARS-CoV-2
specific antibody levels with the capacity to process more than
400,000 serology tests per day. BRL announced additional COVID-19
testing agreements for New York City schools through a continued
collaboration with New York City, the Department of Health and
Hospital Corporation, the Test & Trace Corp. and the Department
of Education. Through these agreements, BRL is testing students,
teachers and staff in nearly 1,000 public schools across New York.
BRL continues to provide COVID-19 testing services to numerous
states, cities, professional sports associations and healthcare
organizations, as well as to over 600 drive-thru and retail
pharmacy testing sites nationwide.
- Positive
somatrogon Phase 3
topline
results reported
from crossover
pediatric
study. A global
Phase 3 study of somatrogon administered once-weekly to children 3
to <18 years of age with growth hormone deficiency met its
primary objective of improved treatment burden compared to daily
injection of Genotropin® as measured by the mean overall Life
Interference total score after 12 weeks of treatment.
- Somatrogon
global regulatory submissions: Pfizer remains on
schedule with respect to its regulatory submissions for marketing
approval of somatrogon for children with growth hormone deficiency
in the U.S. in the fourth quarter of this year and in Europe and
Japan in the first half of 2021.
- RAYALDEE
has received marketing authorizations
in seven
European countries. Vifor Fresenius Medical Care
Renal Pharma, OPKO’s commercial partner for RAYALDEE in Europe, has
received marketing authorizations for RAYALDEE for the treatment of
secondary hyperparathyroidism in adults with stage 3 or 4 chronic
kidney disease (CKD) and vitamin D insufficiency in the United
Kingdom, Germany, Sweden, Norway, Ireland, Denmark and the
Netherlands. Market authorizations from Spain, Portugal, Italy and
Switzerland are still pending. Market launch of RAYALDEE in
authorized countries is expected to begin next year.
- RAYALDEE total
prescriptions reported by IQVIA increased
13% compared with the
third quarter of
2019. Total
prescriptions for the three months ended September 30, 2020
increased to approximately 16,700, compared with approximately
14,800 for the third quarter of 2019. During the third quarter of
2020, demand for RAYALDEE was impacted by challenges in onboarding
new patients because of the COVID-19 pandemic.
- RAYALDEE Phase 2 clinical
trial initiated in
patients with mild-to-moderate
COVID-19. OPKO initiated a
Phase 2 clinical trial with RAYALDEE as a treatment for mild
to moderate COVID-19. The trial, “A Randomized, Double-Blind
Placebo-Controlled Study to Evaluate the Safety and Efficacy
of RAYALDEE
(calcifediol) Extended-release Capsules
to Treat Symptomatic Patients Infected with SARS-CoV-2
(REsCue),” is expected to enroll approximately 160
subjects, many with stage 3 or 4 CKD who are at increased risk for
developing more severe illness. The REsCue trial will randomize
COVID-19 outpatients in a 1:1 ratio to 4 weeks of treatment with
RAYALDEE or placebo, and 2 weeks of follow-up. Primary
efficacy endpoints are raising and maintaining serum total
25-hydroxyvitamin D within the range of 50-100 ng/mL and time to
resolution of COVID-19 symptoms. Numerous independent studies
report a correlation between vitamin D status and COVID-19 risk and
severity.
- GeneDx
enters into
agreement with
Pediatrix Medical Group to
offer
neonatal
genomic
services. In
August 2020, BRL’s GeneDx subsidiary announced an agreement with
Pediatrix Medical Group, the nation’s leading provider of
maternal-fetal, and pediatric medical and surgical subspecialty
physician services, to offer state-of-the-art, next-generation
genomic sequencing to support clinical diagnosis in neonatal
intensive care units staffed by neonatologists affiliated with
Pediatrix. The sequencing is designed to enhance diagnostic
capabilities in order to lessen the impact of disease and to
facilitate the development of novel precision medicine solutions
for pediatric care.
- BioReference
Laboratories
launches
best-in-class
next-generation
sequencing
assay.
In September 2020, BRL, along with its GenPath specialty oncology
division, announced the launch of OnkoSight Advanced™, a
next-generation sequencing (NGS) assay that enables revolutionary
deoxyribonucleic acid (DNA) mutational profiling of tumor samples.
OnkoSight Advanced NGS testing provides targeted gene content
that is aligned with the latest National Comprehensive Cancer
Network and World Health Organization guideline recommendations to
provide critical insight into many of the most common cancer types.
Each OnkoSight Advanced panel includes key biomarkers – Tumor
Mutation Burden and Tumor-Only Microsatellite, critical when
profiling advanced-stage malignancies to guide potential
immunotherapy.
Third Quarter
Financial Results
-
Net income for the third quarter of 2020 was $23.7 million, or
$0.04 per diluted share, compared with a net loss of $62.0 million,
or $0.11 per share, for the comparable period of 2019.
Consolidated revenues for the third quarter of 2020 were $428.1
million compared with $228.8 million for the comparable period of
2019.
-
Diagnostics: Revenue from services in the third
quarter of 2020 was $392.5 million compared with $181.1 million in
the prior-year period, primarily due to increased COVID-19 testing
volumes, partially offset by reduced clinical and genomic test
volumes related to the pandemic and lower clinical and genomic test
reimbursement. In addition, the Company received a $10.0 million
grant from the CARES Act in the third quarter. Total costs and
expenses were $346.4 million in the third quarter of 2020 compared
with $197.5 million in the third quarter of 2019. This
increase represents higher volumes from both COVID-19 testing and
from the core testing business. Operating income was
$46.2 million in the third quarter of 2020 compared with an
operating loss of $16.4 million in the prior-year period, an
improvement of $62.5 million.
-
Pharmaceuticals: Revenue from products in the
third quarter of 2020 was $28.7 million compared with $26.2 million
in the third quarter of 2019, with the increase primarily
attributable to higher sales at OPKO Chile and an increase in net
sales of RAYALDEE to $8.1 million in the third quarter of 2020
compared with $7.4 million in the prior-year period. Revenue from
transfer of intellectual property was $6.8 million in the third
quarter of 2020 compared with $20.7 million in the third quarter of
2019 reflecting a decrease in the amortization of payments received
from Pfizer with respect to somatrogon. Total costs and expenses
were $49.9 million in the third quarter of 2020 compared with $61.1
million in the prior-year period, with the decline primarily
attributable to lower research and development expenses due to the
completion of the pediatric human growth hormone Phase 3 trial. The
operating loss was $14.4 million in the third quarter of 2020
compared with $14.2 million in the third quarter of 2019.
- Cash and
equivalents: Cash, cash equivalents and marketable
securities were $36.3 million as of September 30, 2020, which
reflects the repayment, in full, of its line of credit with JP
Morgan utilizing cash generated from operations of $63.0 million
during the three months ended September 30, 2020. In
addition, the Company has availability under its line of credit
with JP Morgan of $64.7 million and an unutilized $100 million
credit facility that provides access to incremental capital on a
non-dilutive basis.
CONFERENCE CALL & WEBCAST
INFORMATION
OPKO’s senior management will provide a business
update and discuss third quarter financial results in greater
detail during a conference call and live audio webcast at 4:30 p.m.
Eastern time today, October 29, 2020. Participants are requested to
pre-register for the conference call using the link here, or
dialing (888) 869-1189 or (706) 643-5902 and using conference ID
4542807. Upon registering, participants will receive dial-in
numbers, an event passcode and a unique registrant ID to gain
immediate access to the call and bypass the live operator.
Participants may pre-register at any time, including up to and
after the start of the call.
To access the live call via webcast, please
click on the link OPKO 3Q20 Results Conference Call. Individual
investors and investment community professionals who do not plan to
ask a question during the call’s Q&A session are encouraged to
listen to the call via the webcast.
For those unable to listen to the live
conference call, a replay can be accessed for a period of time on
OPKO’s website at OPKO 3Q20 Results Conference Call. A telephone
replay will be available beginning approximately two hours after
the completion of the conference call. To access the replay, please
dial (855) 859-2056 or (404) 537-3406, and use conference ID
4542807.
About OPKO Health
OPKO is a multinational biopharmaceutical and
diagnostics company that seeks to establish industry-leading
positions in large, rapidly growing markets by leveraging its
discovery, development, and commercialization expertise and novel
and proprietary technologies. For more information, visit
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, expectations about COVID-19
testing, the demand for testing, our capacity for testing and
expected turnaround time, the impact of COVID-19 on all of our
businesses, positively and negatively, our ability to expand our
capacity should there be additional demand, the availability of
resources, including labor, equipment and supplies, to meet demand
for testing and the potential impact on us should these resources
be constrained, whether our turnaround time be extended or our
performance quality decline, our product development efforts and
the expected benefits of our products, whether our products in
development will be commercialized, the possibility of unfavorable
new clinical data and further analyses of existing clinical data,
the risk that clinical trial data are subject to differing
interpretations and assessments by regulatory authorities, whether
regulatory authorities will be satisfied with the design of and
results from our clinical studies, whether we will be able to make
the expected regulatory submissions for somatrogon during the
expected time periods or at all, whether the applicable regulatory
agencies will accept our submissions, whether the Rayaldee study
for patients with mild-to moderate COVID-19 will initiate or begin
enrolling subjects later this quarter or be completed at all,
whether our other ongoing and future clinical trials will be
successfully enrolled or 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, whether
RAYALDEE prescriptions will continue to increase, our ability to
market and sell any of our products in development, 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 under the heading “Risk Factors” in our
other filings with the Securities and Exchange Commission, as well
as the ongoing effects of the COVID-19 pandemic, the continuation
and success of our relationship with Pfizer and our other partners,
liquidity issues and 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 somatrogon, RAYALDEE, 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.
Contacts:
LHA Investor RelationsYvonne
Briggs, 310-691-7100ybriggs@lhai.comorBruce Voss, 310-691-7100
bvoss@lhai.com
OPKO Health, Inc. and SubsidiariesCondensed
Consolidated Balance Sheets(in millions)
|
As of |
|
September 30, 2020 |
|
December 31, 2019 |
Assets: |
|
|
|
|
|
|
|
Cash, cash equivalents and marketable securities |
$ |
36.3 |
|
|
$ |
85.5 |
|
Other current assets |
|
391.8 |
|
|
|
238.5 |
|
Total Current Assets |
|
428.1 |
|
|
|
324.0 |
|
In-process Research and
Development and Goodwill |
|
1,266.0 |
|
|
|
1,262.1 |
|
Other assets |
|
677.2 |
|
|
|
723.2 |
|
Total Assets |
$ |
2,371.3 |
|
|
$ |
2,309.3 |
|
|
|
|
|
|
|
|
|
Liabilities and Equity: |
|
|
|
|
|
|
|
Current liabilities |
$ |
335.9 |
|
|
$ |
249.1 |
|
Convertible Notes |
|
219.2 |
|
|
|
211.2 |
|
Deferred tax liabilities, net |
|
119.2 |
|
|
|
118.7 |
|
Other long-term liabilities, principally contract liabilities,
contingent consideration and lines of credit |
|
73.2 |
|
|
|
115.5 |
|
Total Liabilities |
|
747.5 |
|
|
|
694.5 |
|
Equity |
|
1,623.8 |
|
|
|
1,614.8 |
|
Total Liabilities and Equity |
$ |
2,371.3 |
|
|
$ |
2,309.3 |
|
OPKO Health, Inc. and SubsidiariesCondensed
Consolidated Statements of Operations(in millions, except share and
per share data)
|
For the three months endedSeptember 30, |
|
For the nine months endedSeptember 30, |
|
|
2020 |
|
|
|
2019 |
|
|
|
2020 |
|
|
|
2019 |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue from services |
$ |
382.5 |
|
|
$ |
181.1 |
|
|
$ |
804.3 |
|
|
$ |
538.5 |
|
Revenue from products |
|
28.7 |
|
|
|
26.2 |
|
|
|
89.1 |
|
|
|
80.1 |
|
Revenue from transfer of intellectual property |
|
16.9 |
|
|
|
21.5 |
|
|
|
47.3 |
|
|
|
59.0 |
|
Total revenues |
|
428.1 |
|
|
|
228.8 |
|
|
|
940.7 |
|
|
|
677.6 |
|
Costs and expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
272.8 |
|
|
|
141.9 |
|
|
|
575.7 |
|
|
|
430.2 |
|
Selling, general and administrative |
|
99.9 |
|
|
|
80.6 |
|
|
|
253.7 |
|
|
|
264.2 |
|
Research and development |
|
18.5 |
|
|
|
30.0 |
|
|
|
57.9 |
|
|
|
94.8 |
|
Contingent consideration |
|
1.1 |
|
|
|
(1.1 |
) |
|
|
1.3 |
|
|
|
(0.1 |
) |
Amortization of intangible assets |
|
13.9 |
|
|
|
16.4 |
|
|
|
43.8 |
|
|
|
49.4 |
|
Asset impairment charges |
|
0.0 |
|
|
|
0.0 |
|
|
|
0.0 |
|
|
|
0.7 |
|
Total Costs and expenses |
|
406.2 |
|
|
|
267.8 |
|
|
|
932.4 |
|
|
|
839.2 |
|
Operating income (loss) |
|
21.9 |
|
|
|
(39.0 |
) |
|
|
8.3 |
|
|
|
(161.6 |
) |
Other income and (expense),
net |
|
(1.3 |
) |
|
|
(20.9 |
) |
|
|
(5.6 |
) |
|
|
(35.0 |
) |
Loss before
income taxes and investment losses |
|
20.6 |
|
|
|
(59.9 |
) |
|
|
2.7 |
|
|
|
(196.6 |
) |
Income tax benefit
(provision) |
|
3.2 |
|
|
|
(1.8 |
) |
|
|
(4.0 |
) |
|
|
(3.6 |
) |
Loss before
investment losses |
|
23.8 |
|
|
|
(61.7 |
) |
|
|
(1.3 |
) |
|
|
(200.2 |
) |
Loss from investments in
investees |
|
(0.1 |
) |
|
|
(0.3 |
) |
|
|
(0.4 |
) |
|
|
(2.4 |
) |
Net income (loss) |
$ |
23.7 |
|
|
$ |
(62.0 |
) |
|
$ |
(1.7 |
) |
|
$ |
(202.6 |
) |
Income (loss) per share, basic and diluted |
$ |
0.04 |
|
|
$ |
(0.11 |
) |
|
$ |
(0.00 |
) |
|
$ |
(0.35 |
) |
Weighted
average common shares outstanding, basic and diluted |
|
640,699,982 |
|
|
|
586,351,045 |
|
|
|
640,619,485 |
|
|
|
586,348,791 |
|
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