Orchard Therapeutics (Nasdaq: ORTX), a global gene therapy leader,
today announced recent business highlights along with its financial
results for the quarter ended March 31, 2022.
“Throughout these first months of 2022, Orchard has realized
early commercial launch momentum for Libmeldy as the first HSC gene
therapy with meaningful reimbursement coverage in Europe,” said
Bobby Gaspar, M.D., Ph.D., chief executive officer. “We are
extremely pleased by the recognition of Libmeldy’s clinical value,
which is reflected in the reimbursed price attained in Germany and
other major markets in Europe. We remain committed to advancing our
more focused portfolio of HSC gene therapies for severe
neurometabolic diseases and certain larger indications for
patients, providers and other stakeholders.”
Recent Libmeldy Highlights
- Market access:
- Orchard has secured agreements with
three major European markets in 2022 to gain access and
reimbursement for Libmeldy for all eligible patients with
metachromatic leukodystrophy (MLD) who fall within the scope of the
European marketing authorization.
- In May, Orchard announced an
agreement with Gesetzliche Krankenversicherung Spitzenverband
(GKV-SV) which will result in reimbursed access to Libmeldy for all
eligible children with MLD in Germany at a negotiated price of
€2.475 million. The agreement follows completion of a comprehensive
assessment during which Libmeldy received the highest possible
therapeutic benefit rating for presymptomatic, early onset patients
by the Federal Joint Committee, also known as Gemeinsame
Bundesausschuss (G-BA). The link to the full release is available
here
- In April, Orchard announced it
reached an agreement with the Italian Medicines Agency, also known
as Agenzia Italiana del Farmaco (AIFA), that enables access to
Libmeldy for all eligible children with MLD. The link to the full
release is available here.
- In February, Orchard announced an
agreement making Libmeldy available by the National Health Service
(NHS) in England and Wales. The link to the full release is
available here. Reimbursement is also available for eligible MLD
patients in Scotland.
- Treatment delivery:
- Patient identification efforts are
progressing well, and MLD patients from Europe and the Middle East
have now received commercial treatment with Libmeldy, including two
patients who were treated in the first quarter of 2022.
- Newborn screening:
- Activities are also underway to
drive timely diagnosis of MLD, including expanding the number of
newborn screening studies or pilots launching in Germany, Italy,
the UK, France, Austria and the U.S. to eight in total (with two
such initiatives each in Germany and France).
Upcoming Data Publications
- Seven presentations from across
Orchard’s HSC platform will be featured at the American Society of
Gene & Cell Therapy (ASGCT) 25th Annual Meeting taking place
May 16-19 in Washington, D.C. Featured presentations include
updated results on the OTL-203 clinical program for
mucopolysaccharidosis type I Hurler’s syndrome (MPS-IH), as well as
several accepted abstracts highlighting preclinical work
demonstrating the applicability of HSC gene therapy to potentially
address other neurodegenerative and CNS-related conditions,
including the progranulin form of frontotemporal dementia
(GRN-FTD).
Upcoming Key Milestones
Orchard has provided the following list of expected 2022
milestones:
- Libmeldy commercialization:
- Market access: Expand market access by securing additional
European reimbursement agreements.
- Newborn screening: Support the expansion of newborn screening
studies in Europe and the U.S.
- Treatment centers: Expand the
European treatment delivery network by qualifying centers in Sweden
and Spain.
- OTL-200 for MLD (U.S): Conduct a
pre-Biologics License Application (BLA) meeting with U.S. Food and
Drug Administration (FDA) for OTL-200 in the second half of 2022 in
advance of a BLA submission timeline of late 2022 to early
2023.
- OTL-203 for MPS-IH: As part of
ongoing interactions with regulators, Orchard is incorporating
recent feedback related to study design and clinical endpoints into
a revised global registrational protocol, with study initiation now
expected to occur in 2023.
- OTL-201 for MPS-IIIA: Report
clinical data, including early clinical outcomes of cognitive
function, from the OTL-201 proof-of-concept (POC) trial by year end
2022.
- Research programs:
- Report preclinical POC data for the OTL-104 program in NOD2
Crohn’s disease (NOD2-CD) by year end 2022 in advance of
IND-enabling studies in 2023 and an IND submission in 2024.
- Continue to advance the OTL-105 program in hereditary
angioedema (HAE), OTL-204 program for GRN-FTD and work in
HSC-generated antigen-specific Tregs.
First Quarter 2022 Financial Results
Revenue from product sales of Libmeldy were $5.1 million for the
three months ended March 31, 2022, and cost of product sales were
$1.6 million for the period. These resulted from the treatment of
the first two Libmeldy commercial patients during the quarter. Cost
of product sales includes the cost to manufacture the drug product,
royalties to third parties and non-cash amortization of milestones
paid on the approval of Libmeldy.
Collaboration revenue was $0.5 million for the three months
ended March 31, 2022, resulting from the collaboration with
Pharming Group N.V. entered into in July 2021. This revenue
represents expected reimbursements for preclinical studies and a
portion of the $17.5 million upfront consideration received by
Orchard under the collaboration, which is being amortized into
revenue over the expected duration of the agreement.
Research and development expenses were $28.2 million for the
three months ended March 31, 2022, compared to $21.0 million in the
same period in 2021. R&D expenses include the costs of clinical
trials and preclinical work on the company’s portfolio of
investigational gene therapies, as well as costs related to
regulatory, manufacturing, license fees and milestone payments
under the company’s agreements with third parties, and personnel
costs to support these activities. R&D expenses for the first
quarter of 2022 also include certain one-time charges for severance
and payments expected following the termination of certain
development programs totaling $4.3 million. Excluding these
one-time charges, R&D expenses would have increased by $2.9
million from corresponding period in the prior year primarily due
to increased OTL-200 costs for newborn screening studies and
preparatory work for the upcoming BLA in the U.S. The company
expects R&D expenses to decline beginning in the second quarter
of 2022 due to the portfolio updates and proposed workforce
reduction announced in March 2022 as well as the completion of
activities to support the OTL-200 BLA submission.
Selling, general and administrative expenses were $13.3 million
for the three months ended March 31, 2022, compared to $14.1
million in the same period in 2021. The decline from 2021 resulted
primarily from lower cash and share-based personnel costs from the
proposed workforce reduction announced in March 2022 and to align
with the expected filing timelines and commercialization plans for
OTL-200 in the U.S. Excluding one-time charges for severance,
SG&A expenses would have decreased by an additional $0.4
million. In 2022, the company expects SG&A expenses to decline
from 2021 due to the realization of savings from the restructuring,
partially offset by increasing commercialization expenses to
support a potential U.S. launch of Libmeldy in 2023.
During the quarter, the Company had unrealized losses on foreign
currency transactions of $6.1 million, which were driven primarily
by foreign currency fluctuations in accounts denominated in
currencies other than U.S. dollars.
Net loss was $44.3 million for the three months ended March 31,
2022, compared to $35.2 million in the same period in 2021. The
company had approximately 125.9 million ordinary shares outstanding
as of March 31, 2022.
Cash, cash equivalents and investments as of March 31, 2022,
were $199.0 million, with $33.0 million of debt outstanding,
compared to $220.1 million and the same debt figure as of December
31, 2021. During the quarter, the Company received approximately
$16.5 million in cash from tax credits earned in 2020, which
partially offset the cash used for operating activities during the
first quarter of 2022. The company expects that its existing cash,
cash equivalents and investments will fund its anticipated
operating, debt service and capital expenditure requirements into
2024.
Conference Call & Webcast Information
Orchard will host a conference call and live webcast with slides
today at 8:00 a.m. ET to discuss the updates to its business
strategy. The conference call will be broadcast live in listen-only
mode under "News & Events" in the “Investors & Media”
section of the company's website at www.orchard-tx.com, and a
replay will be archived on the Orchard website following the
presentation. To ask a question, please dial +1 (866) 374-5140
(toll-free) or +1 (404) 400-0571 (toll) and use the audience
passcode 71474312#. Please dial in at least 15 minutes in advance
to ensure a timely connection to the call.
Use of Non-GAAP Financial Measures
Orchard has presented certain non-GAAP financial measures,
including research and development costs and selling, general and
administrative expenses, each excluding certain one-time charges.
Management believes this non-GAAP information is useful for
investors, taken in conjunction with Orchard’s GAAP financial
statements, because it provides greater transparency regarding
Orchard’s operating performance. Management uses these measures,
among others, to assess and analyze operational results and trends
and to make financial and operational decisions. Non-GAAP
information is not prepared under a comprehensive set of accounting
rules and should only be used to supplement your understanding of
Orchard’s operating results as reported under GAAP, not as a
substitute for GAAP information. In addition, these non-GAAP
financial measures are unlikely to be comparable with non-GAAP
information provided by other companies. Reconciliation between
these non-GAAP financial measures and the most comparable GAAP
financial measures is included in the section above titled “First
Quarter 2022 Financial Results.”
About Libmeldy / OTL-200
Libmeldy (atidarsagene autotemcel), also known as OTL-200, has
been approved by the European Commission for the treatment of MLD
in eligible early-onset patients characterized by biallelic
mutations in the ARSA gene leading to a reduction of the ARSA
enzymatic activity in children with i) late infantile or early
juvenile forms, without clinical manifestations of the disease, or
ii) the early juvenile form, with early clinical manifestations of
the disease, who still have the ability to walk independently and
before the onset of cognitive decline. Libmeldy is the first
therapy approved for eligible patients with early-onset MLD.
The most common adverse reaction attributed to treatment with
Libmeldy was the occurrence of anti-ARSA antibodies. In addition to
the risks associated with the gene therapy, treatment with Libmeldy
is preceded by other medical interventions, namely bone marrow
harvest or peripheral blood mobilization and apheresis, followed by
myeloablative conditioning, which carry their own risks. During the
clinical studies of Libmeldy, the safety profiles of these
interventions were consistent with their known safety and
tolerability.
For more information about Libmeldy, please see the Summary of
Product Characteristics (SmPC) available on the EMA website.
Libmeldy is approved in the European Union, UK, Iceland,
Liechtenstein and Norway. OTL-200 is an investigational therapy in
the U.S.
Libmeldy was developed in partnership with the San
Raffaele-Telethon Institute for Gene Therapy (SR-Tiget) in Milan,
Italy.
About Orchard Therapeutics
At Orchard Therapeutics, our vision is to end the devastation
caused by genetic and other severe diseases. We aim to do this by
discovering, developing and commercializing new treatments that tap
into the curative potential of hematopoietic stem cell (HSC) gene
therapy. In this approach, a patient’s own blood stem cells are
genetically modified outside of the body and then reinserted, with
the goal of correcting the underlying cause of disease in a single
treatment.
In 2018, the company acquired GSK’s rare disease gene therapy
portfolio, which originated from a pioneering collaboration between
GSK and the San Raffaele Telethon Institute for Gene Therapy in
Milan, Italy. Today, Orchard is advancing a pipeline spanning
pre-clinical, clinical and commercial stage HSC gene therapies
designed to address serious diseases where the burden is immense
for patients, families and society and current treatment options
are limited or do not exist.
Orchard has its global headquarters in London and U.S.
headquarters in Boston. For more information, please
visit www.orchard-tx.com, and follow us
on Twitter and LinkedIn.
Availability of Other Information About Orchard
Therapeutics
Investors and others should note that Orchard communicates with
its investors and the public using the company website
(www.orchard-tx.com), the investor relations website
(ir.orchard-tx.com), and on social media (twitter.com/orchard_tx
and www.linkedin.com/company/orchard-therapeutics), including but
not limited to investor presentations and investor fact sheets,
U.S. Securities and Exchange Commission filings, press releases,
public conference calls and webcasts. The information that Orchard
posts on these channels and websites could be deemed to be material
information. As a result, Orchard encourages investors, the media,
and others interested in Orchard to review the information that is
posted on these channels, including the investor relations website,
on a regular basis. This list of channels may be updated from time
to time on Orchard’s investor relations website and may include
additional social media channels. The contents of Orchard’s website
or these channels, or any other website that may be accessed from
its website or these channels, shall not be deemed incorporated by
reference in any filing under the Securities Act of 1933.
Forward-looking Statements
This press release contains certain forward-looking statements
about Orchard’s strategy, future plans and prospects, which are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements may be identified by words such as “anticipates,”
“believes,” “expects,” “plans,” “intends,” “projects,” and “future”
or similar expressions that are intended to identify
forward-looking statements. Forward-looking statements include
express or implied statements relating to, among other things,
Orchard’s business strategy and goals, the therapeutic potential of
Orchard’s products and product candidates, including the products
and product candidates referred to in this release, Orchard’s
ability to secure agreements to gain access and reimbursement for
its products in additional countries, Orchard’s expectations
regarding the timing of regulatory submissions for approval of its
product candidates, including the product candidates referred to in
this release, the timing of interactions with regulators and
regulatory submissions related to ongoing and new clinical trials
for its product candidates, the timing of announcement of clinical
data for its product candidates, the likelihood that such data will
be positive and support further clinical development and regulatory
approval of these product candidates, the likelihood of approval of
such product candidates by the applicable regulatory authorities,
the size of the potential markets for Libmeldy and Orchard’s other
product candidates, the expected benefits to Orchard’s business as
a result of the organizational updates referred to in this release,
the adequacy of the company’s manufacturing capacity and plans for
future investment, and the company’s financial condition and cash
runway into 2024. These statements are neither promises nor
guarantees and are subject to a variety of risks and uncertainties,
many of which are beyond Orchard’s control, which could cause
actual results to differ materially from those contemplated in
these forward-looking statements. In particular, these risks and
uncertainties include, without limitation: that the cost of
discontinuing or partnering programs may be higher than expected;
the risk that Orchard will not realize the anticipated benefits of
its new strategic plan or the expected cash savings; the risk that
any one or more of Orchard’s product candidates, including the
product candidates referred to in this release, will not be
approved, successfully developed or commercialized; the risk of
cessation or delay of any of Orchard’s ongoing or planned clinical
trials; the risk that Orchard may not successfully recruit or
enroll a sufficient number of patients for its clinical trials; the
risk that prior results, such as signals of safety, activity or
durability of effect, observed from preclinical studies or clinical
trials will not be replicated or will not continue in ongoing or
future studies or trials involving Orchard’s product candidates;
the delay of any of Orchard’s regulatory submissions; the failure
to obtain marketing approval from the applicable regulatory
authorities for any of Orchard’s product candidates or the receipt
of restricted marketing approvals; the risk of delays in Orchard’s
ability to commercialize its product candidates, if approved; the
risk that the ongoing and evolving COVID-19 pandemic could affect
the company's business; and the risk that the market opportunity
for Libmeldy and its other product candidates may be lower than
estimated or that Orchard may be unable to identify patients for
its products on a consistent basis. Given these uncertainties, the
reader is advised not to place any undue reliance on such
forward-looking statements.
Other risks and uncertainties faced by Orchard include those
identified under the heading "Risk Factors" in Orchard’s most
recent annual or quarterly report filed with the U.S. Securities
and Exchange Commission (SEC), as well as subsequent filings and
reports filed with the SEC. The forward-looking statements
contained in this press release reflect Orchard’s views as of the
date hereof, and Orchard does not assume and specifically disclaims
any obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required by law.
Condensed Consolidated Statements of
Operations Data(In thousands, except share and per share
data) (Unaudited)
|
|
Three Months Ended March 31, |
|
|
|
2022 |
|
|
2021 |
|
Net product sales |
|
$ |
5,059 |
|
|
$ |
— |
|
Collaboration revenue |
|
|
465 |
|
|
|
— |
|
Total revenues |
|
|
5,524 |
|
|
|
— |
|
Costs and operating
expenses: |
|
|
|
|
|
|
|
|
Cost of product sales |
|
|
1,571 |
|
|
|
— |
|
Research and development |
|
|
28,234 |
|
|
|
21,035 |
|
Selling, general and administrative |
|
|
13,299 |
|
|
|
14,051 |
|
Total costs and operating expenses |
|
|
43,104 |
|
|
|
35,086 |
|
Loss from operations |
|
|
(37,580 |
) |
|
|
(35,086 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
Interest income |
|
|
69 |
|
|
|
171 |
|
Interest expense |
|
|
(675 |
) |
|
|
(538 |
) |
Other income (expense), net |
|
|
(6,052 |
) |
|
|
1,358 |
|
Total other income (expense), net |
|
|
(6,658 |
) |
|
|
991 |
|
Net loss before income tax |
|
|
(44,238 |
) |
|
|
(34,095 |
) |
Income tax expense |
|
|
(58 |
) |
|
|
(1,087 |
) |
Net loss |
|
|
(44,296 |
) |
|
|
(35,182 |
) |
Net loss per share, basic and
diluted |
|
$ |
(0.35 |
) |
|
$ |
(0.31 |
) |
Weighted average ordinary
shares outstanding, basic and diluted |
|
|
127,694,785 |
|
|
|
114,829,272 |
|
Condensed Consolidated Balance Sheet
Data(in thousands)(Unaudited)
|
|
March 31, |
|
|
December 31, |
|
|
|
2022 |
|
|
2021 |
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
60,775 |
|
|
$ |
55,912 |
|
Marketable securities |
|
|
138,241 |
|
|
|
164,195 |
|
Accounts receivable, net |
|
|
4,105 |
|
|
|
1,480 |
|
Prepaid expenses and other current assets |
|
|
20,923 |
|
|
|
23,011 |
|
Research and development tax credit receivable |
|
|
13,394 |
|
|
|
30,723 |
|
Total current assets |
|
|
237,438 |
|
|
|
275,321 |
|
Non-current assets: |
|
|
|
|
|
|
|
|
Operating lease right-of-use-assets |
|
|
27,368 |
|
|
|
24,316 |
|
Property and equipment, net |
|
|
4,454 |
|
|
|
4,767 |
|
Restricted cash |
|
|
4,266 |
|
|
|
4,266 |
|
Intangible assets, net |
|
|
3,993 |
|
|
|
4,149 |
|
Research and development tax credit receivable |
|
|
3,255 |
|
|
|
— |
|
Other assets |
|
|
10,731 |
|
|
|
9,590 |
|
Total non-current assets |
|
|
54,067 |
|
|
|
47,088 |
|
Total assets |
|
$ |
291,505 |
|
|
$ |
322,409 |
|
Liabilities and
shareholders’ equity |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
9,854 |
|
|
$ |
10,008 |
|
Accrued expenses and other current liabilities |
|
|
25,983 |
|
|
|
24,318 |
|
Deferred revenue, current |
|
|
889 |
|
|
|
346 |
|
Operating lease liabilities |
|
|
7,042 |
|
|
|
7,335 |
|
Notes payable, current |
|
|
3,143 |
|
|
|
786 |
|
Total current liabilities |
|
|
46,911 |
|
|
|
42,793 |
|
Notes payable, long-term |
|
|
29,813 |
|
|
|
32,086 |
|
Deferred revenue, net of current
portion |
|
|
11,554 |
|
|
|
12,519 |
|
Operating lease liabilities, net
of current portion |
|
|
20,798 |
|
|
|
19,278 |
|
Other long-term liabilities |
|
|
6,783 |
|
|
|
5,783 |
|
Total liabilities |
|
|
115,859 |
|
|
|
112,459 |
|
Total shareholders’ equity |
|
|
175,646 |
|
|
|
209,950 |
|
Total liabilities and
shareholders’ equity |
|
$ |
291,505 |
|
|
$ |
322,409 |
|
Contacts
InvestorsRenee LeckDirector, Investor
Relations+1 862-242-0764Renee.Leck@orchard-tx.com
MediaBenjamin NavonDirector, Corporate
Communications+1 857-248-9454Benjamin.Navon@orchard-tx.com
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