Results include the initial sales of
NERLYNX® in the U.S.
Puma Biotechnology, Inc. (NASDAQ: PBYI), a biopharmaceutical
company, announced financial results for the third quarter and nine
months ended September 30, 2017. Unless otherwise stated, all
comparisons are for the third quarter and nine months of 2017
compared to the third quarter and nine months of 2016.
On July 17, 2017, Puma Biotechnology received approval from the
U.S. Food and Drug Administration (FDA) for NERLYNX® (neratinib)
for the treatment of early stage HER2-positive breast cancer
following adjuvant trastuzumab-based therapy, and began shipments
to wholesalers at the end of July 2017. In the third quarter of
2017, the Company reported net revenue from initial sales of
NERLYNX of approximately $6.1 million.
Based on accounting principles generally accepted in the United
States (GAAP), Puma reported a net loss applicable to common stock
of $77.2 million, or $2.07 per share, for the third quarter of
2017, compared to a net loss applicable to common stock of $65.8
million, or $2.02 per share, for the third quarter of 2016. Net
loss applicable to common stock for the first nine months of 2017
was $227.9 million, or $6.15 per share, compared to $203.4 million,
or $6.26 per share, for the first nine months of 2016.
Non-GAAP adjusted net loss was $50.7 million, or $1.36 per
share, for the third quarter of 2017, compared to non-GAAP adjusted
net loss of $36.0 million, or $1.11 per share, for the third
quarter of 2016. Non-GAAP adjusted net loss for the nine months
ended September 30, 2017 was $144.7 million, or $3.90 per share,
compared to non-GAAP adjusted net loss of $115.4 million, or $3.55
per share, for the nine months ended September 30, 2016. Non-GAAP
adjusted net loss excludes stock-based compensation expense, which
represents a significant portion of overall expense and has no
impact on the cash position of the Company. For a reconciliation of
GAAP net loss to non-GAAP adjusted net loss and GAAP net loss per
share to non-GAAP adjusted net loss per share, please see the
financial tables at the end of this news release.
Net cash used in operating activities for the third quarter of
2017 was $54.9 million. Net cash used in operating activities for
the nine months ended September 30, 2017 was $136.9 million. At
September 30, 2017, Puma had cash and cash equivalents of $79.7
million and marketable securities of $26.6 million, compared to
cash and cash equivalents of $194.5 million and marketable
securities of $35.0 million at December 31, 2016.
Effective October 31, 2017, Puma entered into a credit facility
with Silicon Valley Bank and Oxford Finance for a term loan of up
to $100 million, subject to funding in two tranches. The Company
received gross proceeds of $50 million from the first tranche of
the credit facility upon closing on October 31, 2017 and intends to
use the funds for general corporate purposes and to further support
NERLYNX commercial initiatives. The second tranche of $50 million
may be drawn at the Company’s option and is subject to the
achievement of certain milestones. The loan will mature on October
31, 2022.
“With the U.S. approval and launch of NERLYNX in the third
quarter, we began providing early stage HER2-positive breast cancer
patients with an additional option to reduce their risk of disease
recurrence,” said Puma Chief Executive Officer and President Alan
H. Auerbach. “We are pleased with the feedback that we have
received from patients, prescribers and payors during the initial
launch and we look forward to continuing to execute our commercial
activities throughout 2017 and beyond.
“Looking forward, we anticipate the following milestones: (i)
reporting additional data from the Phase II CONTROL trial in the
fourth quarter of 2017; (ii) receiving a regulatory opinion from
the Committee for Medicinal Products for Human Use (CHMP) for
neratinib in extended adjuvant HER2-positive early stage breast
cancer in the first quarter of 2018; and (iii) reporting Phase III
trial results in third-line HER2- positive metastatic breast cancer
patients in the first half of 2018.”
Product Revenue
Net revenue consists of sales of NERLYNX, Puma’s first and only
commercial product to date. The FDA approved NERLYNX in July 2017
and the Company commenced shipment to wholesalers in late July. For
the three and nine months ended September 30, 2017, net revenue was
approximately $6.1 million.
Operating Expenses
Operating expenses were $83.5 million for the third quarter of
2017, compared to $66.0 million for the third quarter of 2016.
Operating expenses for the nine months ended September 30, 2017
were $234.9 million, compared to $203.7 million for the nine months
ended September 30, 2016.
Cost of Sales:
Cost of sales was $1.5 million for the third quarter and nine
months ended September 30, 2017. The Company had no product sales
prior to the third quarter of 2017.
Selling, General and Administrative Expenses:
Selling, general and administrative (SG&A) expenses were
$32.5 million for the third quarter of 2017, compared to $14.0
million for the third quarter of 2016. SG&A expenses for the
nine months ended September 30, 2017 were $75.8 million, compared
to $37.3 million for the nine months ended September 30, 2016. The
$38.5 million increase during the first nine months of 2017,
compared to the first nine months of 2016, resulted primarily from
increases of approximately $24.2 million for professional fees and
expenses, $8.2 million in payroll and related costs, $3.2 million
for stock-based compensation, $2.4 million for other expenses such
as travel and related costs to support the commercial launch of
NERLYNX, and $0.4 million for facility and equipment costs. These
increases reflect overall corporate growth.
Research and Development Expenses:
Research and development (R&D) expenses were $49.5 million
for the third quarter of 2017, compared to $52.0 million for the
third quarter of 2016. R&D expenses for the nine months ended
September 30, 2017 were $157.6 million, compared to $166.4 million
for the nine months ended September 30, 2016. The approximately
$8.8 million decrease during the first nine months of 2017,
compared to the first nine months of 2016, resulted primarily from
decreases of approximately $5.0 million due to a decrease in
regulatory submission activity, decreased preclinical study
activities and decreased drug supply manufacturing logistics, and
$8.0 million for stock-based compensation, partially offset by
increases during the first nine months of 2017, compared to the
first nine months of 2016, of approximately $2.2 million for
internal clinical development, internal regulatory affairs and
quality assurance and internal chemical manufacturing, and $2.0
million for consultants and contractors.
Conference Call
Puma Biotechnology will host a conference call to report its
third quarter financial results and provide an update on the
company's business and outlook at 1:30 p.m. PST/4:30 p.m. EST on
Thursday, November 9, 2017. The call may be accessed by dialing
1-877-709-8150 (domestic) or 1-201-689-8354 (international) at
least 10 minutes prior to the start of the call and referencing the
“Puma Biotechnology Conference Call.” A live webcast of the
conference call and presentation slides may be accessed on the
Investors section of the Puma Biotechnology website at
http://www.pumabiotechnology.com/. A replay of the call will be
available approximately one hour after completion of the call and
will be archived on the company's website for 90 days.
About Puma Biotechnology
Puma Biotechnology, Inc. is a biopharmaceutical company with a
focus on the development and commercialization of innovative
products to enhance cancer care. The Company in-licenses the global
development and commercialization rights to three drug candidates —
PB272 (neratinib, oral), PB272 (neratinib, intravenous) and PB357.
NERLYNX® (neratinib, oral) is approved for commercial use by
prescription in the United States as extended adjuvant therapy for
early stage HER2-positive breast cancer following adjuvant
trastuzumab-based therapy and is marketed as NERLYNX. Neratinib is
a potent irreversible tyrosine kinase inhibitor that blocks signal
transduction through the epidermal growth factor receptors, HER1,
HER2 and HER4. Currently, the Company is primarily focused on the
commercialization of NERLYNX and the continued development of its
other advanced drug candidates directed at the treatment of
HER2-positive breast cancer. The Company believes that NERLYNX has
clinical application in the potential treatment of several other
cancers that over-express or have a mutation in HER2.
Further information about Puma Biotechnology may be found at
www.pumabiotechnology.com.
IMPORTANT SAFETY INFORMATION
NERLYNX® (neratinib) tablets, for oral
use
INDICATIONS AND USAGE: NERLYNX is a kinase inhibitor
indicated for the extended adjuvant treatment of adult patients
with early stage HER2 overexpressed/amplified breast cancer, to
follow adjuvant trastuzumab-based therapy.
CONTRAINDICATIONS: None
WARNINGS AND PRECAUTIONS:
• Diarrhea: Aggressively manage diarrhea occurring
despite recommended prophylaxis with additional antidiarrheals,
fluids, and electrolytes as clinically indicated. Withhold NERLYNX
in patients experiencing severe and/or persistent diarrhea.
Permanently discontinue NERLYNX in patients experiencing Grade 4
diarrhea or Grade ≥ 2 diarrhea that occurs after maximal dose
reduction.
• Hepatotoxicity: Monitor liver function tests monthly
for the first 3 months of treatment, then every 3 months while on
treatment and as clinically indicated. Withhold NERLYNX in patients
experiencing Grade 3 liver abnormalities and permanently
discontinue NERLYNX in patients experiencing Grade 4 liver
abnormalities.
• Embryo-Fetal Toxicity: NERLYNX can cause fetal harm.
Advise patients of potential risk to a fetus and to use effective
contraception.
ADVERSE REACTIONS: The most common adverse reactions (≥
5%) were diarrhea, nausea, abdominal pain, fatigue, vomiting, rash,
stomatitis, decreased appetite, muscle spasms, dyspepsia, AST or
ALT increase, nail disorder, dry skin, abdominal distention,
epistaxis, weight decreased and urinary tract infection.
To report SUSPECTED ADVERSE REACTIONS, contact Puma
Biotechnology, Inc. at 1-844-NERLYNX (1-844-637-5969) and
www.NERLYNX.com or FDA at 1-800-FDA-1088 or
www.fda.gov/medwatch.
DRUG INTERACTIONS:
- Gastric acid reducing agents: Avoid
concomitant use with proton pump inhibitors (PPI) and H2-receptor
antagonists. Separate NERLYNX by 3 hours after antacid dosing.
- Strong or moderate CYP3A4 inhibitors:
Avoid concomitant use.
- Strong or moderate CYP3A4 inducers:
Avoid concomitant use.
- P-glycoprotein (P-gp) substrates:
Monitor for adverse reactions of narrow therapeutic agents that are
P-gp substrates when used concomitantly with NERLYNX.
USE IN SPECIFIC POPULATIONS:
• Lactation: Advise women not to breastfeed.
Please see Full Prescribing Information for additional safety
information.
Forward-Looking Statements
This press release and the webcast of the presentation contain
forward-looking statements, including statements regarding the
benefits of NERLYNX and neratinib, the Company’s clinical trials
and the announcement of data relative to those trials. All
forward-looking statements involve risks and uncertainties that
could cause the Company’s actual results to differ materially from
the anticipated results and expectations expressed in these
forward-looking statements. These statements are based on current
expectations, forecasts and assumptions, and actual outcomes and
results could differ materially from these statements due to a
number of factors, which include, but are not limited to, the risk
factors disclosed in the periodic and current reports filed by the
Company with the Securities and Exchange Commission from time to
time, including the Company’s Quarterly Report on Form 10-Q for the
quarter ended September 30, 2017. Readers are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The Company assumes no obligation
to update these forward-looking statements, except as required by
law.
PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY CONSOLIDATED
STATEMENTS OF OPERATIONS (in millions except share and per
share data) Three Months
Ended Nine Months Ended September 30, September 30, (Unaudited)
(Unaudited) 2017 2016 2017
2016 Revenue, net $ 6.1 $ - $ 6.1 $ -
Operating expenses: Cost of sales 1.5 - 1.5 - Selling, general and
administrative 32.5 14.0 75.8 37.3 Research and development
49.5 52.0 157.6 166.4
Totals 83.5 66.0 234.9
203.7 Loss from operations (77.4 )
(66.0 ) (228.8 ) (203.7 ) Other income
(expenses): Interest income 0.3 0.2 1.0 0.7 Other income (expense)
(0.1 ) - (0.1 ) (0.4 ) Totals
0.2 0.2 0.9 0.3
Net loss $ (77.2 ) $ (65.8 ) $ (227.9 ) $ (203.4 ) Net loss
per common share—basic and diluted $ (2.07 ) $ (2.02 ) $ (6.15 ) $
(6.26 ) Weighted-average common shares outstanding—basic and
diluted 37,214,002 32,497,168
37,046,765 32,489,584
PUMA
BIOTECHNOLOGY, INC. AND SUBSIDIARY LIQUIDITY AND CAPITAL
RESOURCES (in millions, unaudited)
September 30, December 31, 2017 2016
Cash and cash equivalents $ 79.7 $ 194.5 Marketable
securities 26.6 35.0 Working capital 22.3 199.0 Stockholders'
equity 79.2 209.8 Nine Months Nine Months Ended Ended
September 30, September 30, 2017 2016
Cash provided by (used in): Operating activities $ (136.9 ) $
(100.7 ) Investing activities 8.1 121.4 Financing activities
14.0 0.3 Increase (decrease) in cash
and cash equivalents $ (114.8 ) $ 21.0
Non-GAAP Financial Measures
In addition to operating results as calculated in accordance
with generally accepted accounting principles, or GAAP, the Company
uses certain non-GAAP financial measures when planning, monitoring,
and evaluating operational performance. The following table
presents the Company’s net loss and net loss per share calculated
in accordance with GAAP and as adjusted to remove the impact of
employee stock-based compensation. For the three and nine months
ended September 30, 2017, stock-based compensation represented
approximately 34.3% and 36.5% of net loss, respectively. Although
net loss is important to measure financial performance, the Company
currently places an emphasis on cash burn and, more specifically,
cash used in operations. Stock-based compensation appears in GAAP
net loss but is removed from net loss to arrive at cash used in
operations on the statement of cash flows. Due to its noncash
nature, the Company believes these non-GAAP measures enhance
understanding of financial performance, are more indicative of
operational performance and facilitate a better comparison among
fiscal periods. These non-GAAP financial measures are not, and
should not be viewed as, substitutes for GAAP reporting
measures.
PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY Reconciliation of
GAAP Net Loss to Non-GAAP Adjusted Net Loss and GAAP Net
Loss Per Share to Non-GAAP Adjusted Net Loss Per Share (in
millions except share and per share data) (Unaudited)
Three Months Ended September 30,
2017 2016 GAAP net loss $
(77.2 ) $ (65.8 ) Adjustments: Stock-based compensation - Selling,
general and administrative 8.3 7.7 (1) Research and development
18.2 22.1 (2) Non-GAAP adjusted net
loss $ (50.7 ) $ (36.0 ) GAAP net loss per share -
basic and diluted $ (2.07 ) $ (2.02 ) Adjustment to net loss (as
detailed above) 0.71 0.91 Non-GAAP
adjusted net loss per share $ (1.36 ) $ (1.11 ) (3)
Nine
Months Ended September 30, 2017
2016 GAAP net loss $ (227.9 ) $ (203.4 ) Adjustments:
Stock-based compensation - Selling, general and administrative 23.0
19.7 (1) Research and development 60.2 68.3
(2) Non-GAAP adjusted net loss $ (144.7 ) $ (115.4 )
GAAP net loss per share - basic and diluted $ (6.15 ) $ (6.26 )
Adjustment to net loss (as detailed above) 2.25
2.71 Non-GAAP adjusted net loss per share $ (3.90 ) $
(3.55 ) (4) (1) To reflect a non-cash charge to operating
expense for Selling, General and Administrative stock-based
compensation. (2) To reflect a non-cash charge to operating expense
for Research and Development stock-based compensation. (3) Non-GAAP
adjusted net loss per share was calculated based on 37,214,002 and
32,497,168 weighted average common shares outstanding for the three
months ended September 30, 2017 and 2016, respectively. (4)
Non-GAAP adjusted net loss per share was calculated based on
37,046,765 and 32,489,584 weighted average common shares
outstanding for the nine months ended September 30, 2017 and 2016,
respectively.
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version on businesswire.com: http://www.businesswire.com/news/home/20171109006436/en/
Puma Biotechnology, Inc.Alan H. Auerbach or Mariann Ohanesian,
+1
424-248-6500info@pumabiotechnology.comir@pumabiotechnology.comorRusso
PartnersDavid Schull or Amiad Finkelthal, +1
212-845-4200david.schull@russopartnersllc.comamiad.finkelthal@russopartnersllc.com
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