LEIDEN, Netherlands, Oct. 24, 2019 /PRNewswire/ --
Compared with the first nine months of 2018 (on a like-for-like basis):
-- Revenues up 26%, operating profit up 38%, net profit up 73%
Compared with the previous quarter ended 30 June 2019:
-- Revenues up 7%, operating profit up 46%, net profit up 52% (after
additional EUR2.5 million provision for contingent consideration)
-- Maintained cash position despite paying a EUR17.9m upfront to secure the
rights to leniolisib from Novartis
Good progress in expanding and extending the pipeline:
-- Strategic investment in the license from Novartis of the new leniolisib
(CDZ173) program, the first new program from outside the Company's
-- Initiation of the first clinical study of RUCONEST® in pre-eclampsia
Pharming Group N.V. ("Pharming" or "the Company") presents its (unaudited) interim financial report for the first nine months and the third quarter ended 30 September 2019.
-- Net product sales for the first nine months of 2019 increased to
EUR122.8 million (Q3 2019: EUR45.3 million), an increase of
approximately 26% on a like-for-like basis compared to EUR97.7 million
for the first nine months of 2018, mainly as a result of the increasing
numbers of patients using RUCONEST® in the USA.
-- US net product sales for the first nine months of 2019 increased to
EUR119.0 million (Q3 2019: EUR44.1 million), an increase of 28% compared
to EUR92.9 million for the first nine months of 2018. In the rest of
the world, product sales for the first nine months of 2019 were EUR3.7
million (Q3: EUR1.2 million), a decrease of approximately 23% compared
to EUR4.8 million the first nine months of 2018. This decrease reflects
launches of competitor products and increased claims for rebates by
government agencies in 2019.
-- Total revenues for the first nine months of 2019 increased by 26% to
EUR122.8 million (including EUR0.6 million of license revenue) from
EUR98.3 million in the first nine months of 2018 (including EUR0.6
million of license revenue).
-- Operating profits (EBIT) rose by 38% to EUR42.7 million in the first
nine months of 2019, compared to EUR31.0 million in the first nine
months of 2018. Operating profits also rose by 46% quarter on quarter,
to EUR18.1 million in the third quarter from EUR12.4 million in the
second quarter of 2019. These improvements were made despite a slight
increase in operating costs above the average for the first half of the
year, mainly relating to investments in expansion of production capacity
and clinical development costs for the new indications for RUCONEST®.
-- Net profit for the first nine months was EUR24.1 million (Q3: EUR10.5
million), compared with EUR13.9 million in the same period last year
after restatement. The 73% improvement quarter on quarter resulted
mainly from the increased sales in the USA net of an additional EUR2.5
million provision taken for the contingent consideration for future
milestones due to Bausch Health (previously Valeant Pharmaceuticals).
-- Significantly higher cashflows during the third quarter of 2019 were
driven by increasing revenues above the cash required for costs and
repayment of the quarterly instalment of EUR7.5 million of the principal
amount of the Company's outstanding loan including associated fees. The
remaining balance of the loan amounts to approximately $58 million. The
cash position was reduced by the $20 million (EUR17.9 million) upfront
payment to Novartis as part of the license agreement relating to
leniolisib announced in August and described below. This resulted in a
small net decrease in the cash position to EUR64.4 million from EUR65.3
million at June 30 2019 (EUR72.2 million at 30 September 2018),
reflecting that the net cash generated during the quarter before this
one-off payment was EUR17.0 million.
-- The equity position improved from EUR77.5 million at the end of the
second quarter 2019 to EUR90.5 million at the end of the third quarter
of 2019 (Q3 2018: EUR48.2 million), mainly due to the net result during
the quarter. Other financial liabilities, which refer to the contingent
consideration for successful sales performance milestones, has been
divided into current and non-current elements, reflecting the high
probability of paying the next milestone in 2020.
-- Inventories changed from EUR12.7 million at the end of the second
quarter of 2019 to EUR11.8 million at the end of the third quarter of
2019 (End of December 2018: EUR17.3 million), mainly due to slightly
larger than anticipated sales demand in the US market. As a result of
this demand and the regular need to provide ad hoc supplies in various
European markets following temporary shortages of plasma-derived
products, we are now seeing short term pressure on supplies of product
for certain European territories, which may lead to temporary restraints
on supplies during the last months of the year and potentially into the
first quarter of 2020, subject to the pending EMA approval for the
Company's new production facility.
-- Net profits were affected by an increase of EUR2.5 million in the
contingent consideration, reflecting the higher likelihood of the last
RUCONEST® milestone payments to Bausch Health becoming due as well as
the early possibility of paying regulatory milestones in respect of the
new asset leniolisib described below. This provision (listed under other
financial liabilities) has been split into current and non-current
segments to reflect the high probability that the next RUCONEST®
milestone to Bausch Health will be due within 12 months.
-- Right-of-use assets in the non-current assets section of the balance
sheet, and lease liabilities under current and non-current liabilities,
show the effects of new disclosures of items acquired under leases under
the new financial standard IFRS 16. These changes have had no material
net effect on operating results during the quarter. These figures were
not originally reported in 2018 as the standard had not come into force.
-- Since the last reporting date of 30 June 2019, the Company has issued a
total of 2,762,9801 shares and recovered 762,981 shares from expired or
cancelled options in connection with a number of exercises and expiries
of options under the current schemes. The number of issued shares as at
24 October 2019 is 629,561,640. The fully diluted number of shares as
at 24 October 2019 is 680,521,480.
Operational highlights during the third quarter and following the reporting date
-- In August 2019, the Company announced that it had entered into a
development collaboration and license agreement with Novartis to develop
and commercialize leniolisib (CDZ173), a small molecule phosphoinositide
3-kinase delta (PI3Kẟ) inhibitor being developed by Novartis to treat
patients with Activated Phosphoinositide 3-kinase Delta Syndrome
("APDS"). Development of the compound through its current
registration-enabling trial will be continued by Novartis and Pharming
in partnership. Pharming will commercialize the treatment if it obtains
approval from regulators. Pharming paid an upfront amount of EUR17.9
million (US$20 million) for the license. Further details of the terms
were not disclosed. APDS is a primary immune deficiency caused by a
mutation in the PIK3CD gene that increases activity of PI3Kẟ, a
promoter of activity in the immune system. As a result of this
over-activity, the cells involved in immune response can fail to be
differentiated properly, which means that sufferers are unable to react
well to infections, and can suffer early cell death. Patients
frequently suffer a functional inability to fight off infections, as
well as developing airway and other lesions and certain cancers. It is
an ultra-rare disease with incidence rates across the world of
approximately 1-2 per million. Importantly, there is a commercially
available genetic test that can identify the patients who will benefit
from leniolisib making this program personalized medicine for these APDS
patients and their family members who also have the mutation. Once this
test is applied to patients with currently unspecified primary immune
deficiencies, a clearer picture of the prevalence of the condition can
-- In October 2019, the Company confirmed it has been included in an
injunction in the USA obtained by CSL Behring, a subsidiary of CSL
Limited of Australia ("CSL"), to prevent possible transmission of
proprietary documents and data to Pharming which CSL claimed had been
removed from its systems by Dr Joseph Chiao, who was hired recently by
Pharming to be a medical director. Pharming did not induce or encourage
Dr Chiao to breach any rules or contract terms or in any way to remove
any data from his former employer. Furthermore, neither Pharming nor our
colleague Dr. Anurag Relan had received or seen any proprietary CSL
information from Dr Chiao or any other source. Yesterday, CSL
voluntarily dismissed the charges against Pharming without any fault,
liability or penalties against Pharming. Dr Chiao's employment with
Pharming has been terminated.
Sijmen de Vries, Chief Executive Officer, commented:
"I am pleased to report strong results again today, despite the ongoing intense competition in the market. The continued growth for RUCONEST® is a result of the increasing number of patients benefiting from the product in acute attacks of hereditary angioedema and reinforces our patient-centric approach.
In addition, we continue to make good progress in our pipeline, having commenced the first clinical trial of RUCONEST® to treat and prevent pre-eclampsia and preparing to commence a clinical trial for RUCONEST® to reduce or prevent Acute Kidney Injury in patients undergoing percutaneous coronary interventions in Q4 2019.
During the quarter we completed a significant transaction through the in-license of Novartis's leniolisib (CDZ-173), a late-stage small molecule for the treatment of an ultra-rare immune deficiency, marking the first acquisition of a new program outside the Company's platform. This product, upon approval, will use the current commercial infrastructure that has contributed to the success of RUCONEST®. It precisely represents Pharming's mission: to bring new therapies to patients with unmet medical needs. We will be looking for more assets of this kind, as well as other opportunities to enhance shareholder value.
Finally, yesterday we were able to confirm that all charges against Pharming were voluntarily dropped by CSL without any fault, liabilities or penalties against Pharming."
-- During the third quarter of 2019 we demonstrated continued growth in
RUCONEST® sales, building on the higher-than-expected positive progress
in the previous quarter as reported in our half-year results, and
validating our marketing approach to ensure all patients have access to
RUCONEST® for their HAE attacks.
-- Looking forward to the remainder of 2019 and beyond, we expect sales in
the last quarter of this year to be in the same range as Q3 despite
competitive pressure as more patients become familiar with the ease of
treating their acute attacks of HAE with RUCONEST®. Additionally we
expect more patients to use RUCONEST® to treat breakthrough attacks
that occur despite the prophylaxis medication they use. We expect to
start 2020 on a very strong footing with many good new opportunities to
enhance shareholder value further in the future.
Board of Management
Dr Sijmen de Vries
Dr Bruno Giannetti
24 October 2019
For the remainder of 2019, the Company expects:
-- Continued growth in revenues from sales of RUCONEST®, mainly driven by
the US operations.
-- Maintenance of positive quarterly net earnings during the year.
-- Continued progress in the registration-enabling study for Leniolisib
(CDZ173), the product inlicensed from Novartis.
-- Continued investment in the expansion of production of RUCONEST® in
order to ensure continuity of supply to the growing markets in the USA
and Europe, and later for China and the Rest of the World.
-- Continued investment in the clinical trials for RUCONEST® for
pre-eclampsia and acute kidney injury
-- Support for investigators wishing to explore new additional unmet needs
for C1 esterase inhibitor RUCONEST®
-- Further exploring of new routes of administration prior to selection of
a route aiming to produce a painless convenient method of delivery of
-- Continued investment in development of the new internal pipeline
programs in Pompe disease and Fabry's disease.
-- Purchase or license of other new development opportunities and assets
where these can add value for shareholders.
-- Increasing marketing activity where this can be accretive to earnings
About Pharming Group N.V.
Pharming is a specialty pharmaceutical company developing innovative products for the safe, effective treatment of rare diseases and unmet medical needs. Pharming's lead product, RUCONEST® (conestat alfa) is a recombinant human C1 esterase inhibitor approved for the treatment of acute Hereditary Angioedema ("HAE") attacks in patients in Europe, the USA, Israel and South Korea. The product is available on a named-patient basis in other territories where it has not yet obtained marketing authorization.
RUCONEST® is distributed by Pharming in Austria, France, Germany, Luxembourg, the Netherlands, the United Kingdom and the United States of America. Pharming holds commercialisation rights in Algeria, Andorra, Bahrain, Belgium, Ireland, Jordan, Kuwait, Lebanon, Morocco, Oman, Portugal, Qatar, Syria, Spain, Switzerland, Tunisia, United Arab Emirates and Yemen. In some of these countries and in countries where no partner is present, distribution is made in association with the HAEi Global Access Program (GAP).
RUCONEST® is distributed by Swedish Orphan Biovitrum AB (publ) (SS: SOBI) in the other EU countries, and in Azerbaijan, Belarus, Georgia, Iceland, Kazakhstan, Liechtenstein, Norway, Russia, Serbia and Ukraine.
RUCONEST® is distributed in Argentina, Colombia, Costa Rica, the Dominican Republic, Panama, and Venezuela by Cytobioteck, in South Korea by HyupJin Corporation and in Israel by Kamada.
RUCONEST® is also being examined for approval for the treatment of HAE in young children (2-13 years of age) and evaluated for various additional follow-on indications.
Leniolisib is in the final stage of clinical development for Activated Phosphoinositide 3-kinase Delta Syndrome ("APDS"), a type of primary immune deficiency. Leniolisib is a small molecule phosphoinositide 3-kinase delta (PI3Kẟ) inhibitor developed by Novartis. Global rights to the product were obtained from Novartis in Q3 2019. Development of the compound through its current registration-enabling trial will be continued by Novartis and Pharming in partnership. Pharming will then commercialize the treatment if it obtains approval from regulators.
Pharming's technology platform includes a unique, GMP-compliant, validated process for the production of pure recombinant human proteins that has proven capable of producing industrial quantities of high quality recombinant human proteins in a more economical and less immunogenetic way compared with current cell-line based methods. Leads for enzyme replacement therapy ("ERT") for Pompe and Fabry's diseases are being optimized at present.
Pharming has a long-term partnership with the China State Institute of Pharmaceutical Industry ("CSIPI"), a Sinopharm company, for joint global development of new products, starting with recombinant human Factor VIII for the treatment of Haemophilia A. Pre-clinical development and manufacturing will take place to global standards at CSIPI and are funded by CSIPI. Clinical development will be shared between the partners with each partner taking the costs for their territories under the partnership.
Additional information is available on the Pharming website: www.pharming.com [http://www.pharming.com/]
This press release of Pharming Group N.V. and its subsidiaries ("Pharming", the "Company" or the "Group") may contain forward-looking statements including without limitation those regarding Pharming's financial projections, market expectations, developments, partnerships, plans, strategies and capital expenditures.
The Company cautions that such forward-looking statements may involve certain risks and uncertainties, and actual results may differ. Risks and uncertainties include without limitation the effect of competitive, political and economic factors, legal claims, the Company's ability to protect intellectual property, fluctuations in exchange and interest rates, changes in taxation laws or rates, changes in legislation or accountancy practices and the Company's ability to identify, develop and successfully commercialise new products, markets or technologies.
As a result, the Company's actual performance, position and financial results and statements may differ materially from the plans, goals and expectations set forth in such forward-looking statements. The Company assumes no obligation to update any forward-looking statements or information, which should be taken as of their respective dates of issue, unless required by laws or regulations.
For further public information, contact
Sijmen de Vries, CEO: T: +31-71-524-7400
Robin Wright, CFO: T: +31-71-524-7432
Julia Phillips/ Victoria Foster Mitchell, T: +44-203-727-1136
LifeSpring Life Sciences Communication, Amsterdam, The Netherlands
Leon Melens, Tel: +31 6 53 81 64 27
Pharming Group N.V.
Consolidated Interim Financial Statements (unaudited, in Euros)
For the first nine months ended 30 September 2019
-- Consolidated statement of income
-- Consolidated statement of comprehensive income
-- Consolidated balance sheet
-- Consolidated statement of cash flows
Appendix: Main Financial Statements reported in US dollars
(This appendix is not part of the Consolidated Interim Financial Statements)
-- Consolidated statement of income in US Dollars
-- Consolidated balance sheet in US Dollars
-- Consolidated statement of cash flows in US Dollars
Appendix: Main Financial Statements reported in US dollars
These statements are not part of the original Interim Financial Statements. The original Interim Financial Statements are reported in euros. In case of differences of interpretation between the Financial Statements in US dollars and the Financial Statements in euros, the Financial Statements in euros will prevail.
Exchange rates (EUR/USD) used:
-- Statement of income YTD 2018:
-- Statement of income YTD 2019:
-- Balance sheet 31 December 2018:
-- Balance sheet 30 September 2019:
-- Cash flow YTD 2018:
-- Cash flow YTD 2019:
-- Cash balance as per 1 January 2018:
-- Cash balance as per 30 September 2018:
-- Cash balance as per 1 January 2019:
-- Cash balance as per 30 September 2019:
Please see the link for Pharming Group Financial Results for the First Nine Months of 2019:
PDF: https://mma.prnewswire.com/media/1016748/PR_Q3_results_final_24_October_2019.pdf [https://mma.prnewswire.com/media/1016748/PR_Q3_results_final_24_October_2019.pdf]