BeiGene Reports Second Quarter 2018 Financial Results
Aug 09, 2018 5:05 AM
“We continued to make excellent progress with encouraging new clinical data, including initial topline data from pivotal trials for our lead drug candidates, zanubrutinib and tislelizumab,” said
“Our commercial organization in
Recent Business Highlights and Upcoming Milestones
Clinical Programs
Zanubrutinib (BGB-3111), an investigational small molecule inhibitor of Bruton’s tyrosine kinase (BTK)
- Received Fast Track designation from the
U.S. Food and Drug Administration (FDA) for the treatment of patients with Waldenström macroglobulinemia (WM); - Announced plans to submit a New Drug Application (NDA) with the FDA in the first half of 2019 to pursue accelerated approval of zanubrutinib for WM based on the results from the ongoing global Phase 1 trial. A final determination to submit the NDA will be made subsequent to the pre-NDA meeting with the FDA after obtaining mature data from the trial this fall;
- Announced preliminary topline data from the independent review of response data from the 86-patient single-arm pivotal Phase 2 trial of zanubrutinib in Chinese patients with relapsed or refractory (R/R) mantle cell lymphoma (MCL). With a median follow-up time of 8.3 months at the data cutoff, the overall response rate was 84 percent, including 59 percent complete response;
- Completed enrollment in the global Phase 3 trial comparing zanubrutinib to ibrutinib in patients with WM; and
- Presented clinical data at the 23rd
Congress of theEuropean Hematology Association (EHA), including updated Phase 1 data from patients with WM and pooled safety data from zanubrutinib monotherapy trials.
Expected Upcoming Milestones in 2018
- Submit first NDA in
China for MCL later this year; - Present full results of the pivotal Phase 2 trial in Chinese patients with R/R MCL at an upcoming major medical conference;
- Initiate a global head-to-head Phase 3 trial versus ibrutinib in R/R chronic lymphocytic leukemia; and
- Present updated Phase 1 monotherapy or combination data at medical conferences.
Tislelizumab (BGB-A317), an investigational humanized monoclonal antibody against the immune checkpoint receptor PD-1
- Announced preliminary topline results from the independent review of response data from the pivotal Phase 2 trial of tislelizumab in 70 Chinese patients with R/R classical Hodgkin’s lymphoma (cHL). With a minimum of 24 weeks of follow-up and a median follow-up time of 7.85 months at the data cutoff, overall response rate was 85.7 percent, including 61.4 percent complete response;
- Completed the dose-escalation phase of the combination trial with zanubrutinib in patients with B-cell malignancies and initiated the dose- expansion phase in 8 patients; and
- Initiated the following trials:
- Phase 3 trial in
China of tislelizumab combined with chemotherapy, as a potential first-line treatment in patients with Stage IIIB or IV non-squamous non-small cell lung cancer (NSCLC); and - Phase 3 trial in
China of tislelizumab combined with chemotherapy as a potential first-line treatment in patients with Stage IIIB or IV squamous NSCLC.
- Phase 3 trial in
Expected Upcoming Milestones in 2018
- Submit NDA in
China for cHL later this year; - Complete enrollment in the Phase 2 pivotal trial in
China for urothelial carcinoma; - Present updated Phase 1 data and
China pivotal trial data at a medical conference; and - Initiate additional pivotal trials in 2018 or early 2019.
Pamiparib (BGB-290), an investigational small molecule PARP inhibitor
- Initiated the following trials:
- Global Phase 3 trial as maintenance therapy in patients with inoperable locally advanced or metastatic gastric cancer who responded to platinum-based first-line chemotherapy;
- Phase 3 trial as maintenance therapy in
China in patients with platinum-sensitive recurrent ovarian cancer; and - Phase 2 trial in
China in patients with metastatic HER2-negative breast cancer with BRCA mutation.
Expected Upcoming Milestones in 2018
- Present updated Phase 1 monotherapy and/or combination data at a medical conference.
Sitravatinib, an investigational tyrosine kinase inhibitor of receptor tyrosine kinases (RTKs), including TAM family receptors (TYRO3, Axl, MER), split family receptors (VEGFR2, KIT) and RET; licensed from Mirati Therapeutics in
Expected Upcoming Milestones
- Initiate Phase 1 trial in combination with tislelizumab in
China in 2018 or early 2019.
BGB-A425, an investigational humanized monoclonal antibody against T-cell immunoglobulin and mucin-domain containing-3(TIM-3)
- Received clearance for an investigational new drug (IND) application in
the United States .
Expected Upcoming Milestones in 2018
- Initiate Phase 1/2 trial investigating the safety, tolerability, pharmacokinetics and preliminary antitumor activity in combination with tislelizumab in patients with advanced solid tumors.
Commercial Programs
- Generated 35% increase in quarter-over-quarter revenue from sales in
China of ABRAXANE®, REVLIMID® and VIDAZA®, and 101% growth vs. the fourth quarter of 2017, the first full quarter following the license of these products from Celgene.
- Continued to expand potential patient access to ABRAXANE® (nanoparticle albumin-bound paclitaxel) in
China through inclusion in the provincial reimbursement drug list inHunan and critical illness insurance inShandong .
Corporate Developments
- Completed an initial public offering as a dual primary listing on the Main Board of the
Hong Kong Stock Exchange and a global offering in which we raised approximately$903 million in gross proceeds; - Appointed
Vivian Bian as China Co-Commercial Head, with strategic focus on marketing, strategy, new product introductions and business model innovation; and - Continued the construction of the
Guangzhou biologics manufacturing facility with the state-of-the-art KuBio™ prefabricated biomanufacturing equipment delivered by General Electric. The first phase of the facility is expected to be completed and operational in 2019.
Second Quarter 2018 Financial Results
Cash, Cash Equivalents, Restricted Cash and Short-Term Investments were $1,401.22 million as of June 30, 2018, compared to
Cash used by operations for the three months ended
Revenue for the three months ended June 30, 2018 were
- Product revenue from sales of ABRAXANE®, REVLIMID® and VIDAZA® in
China totaled$31.43 million for the second quarter of 2018. - Collaboration revenue totaled
$21.38 million for the second quarter of 2018, reflecting$18.18 million of research and development reimbursement revenue from Celgene,$1.70 million of research and development service revenue from deferred recognition of upfront fees, and$1.50 million of milestone revenue under the collaboration agreement for pamiparib with Merck KGaA, Darmstadt, Germany.
Expenses for the three months ended
- Cost of sales for the three months ended
June 30, 2018 were$6.26 million , compared to nil in the second quarter of 2017. Cost of sales relates to the cost of acquiring ABRAXANE®, REVLIMID® and VIDAZA® for distribution inChina .
- R&D Expenses for the three months ended
June 30, 2018 were$164.25 million , compared to$47.25 million in the same period in 2017. The increase in R&D expenses was primarily attributable to increased spending on our ongoing and newly initiated late-stage pivotal clinical trials, preparation for regulatory filings and commercial launch of our late-stage drug candidates, manufacturing costs related to pre-commercial activities and supply as well as increases in spending related to our preclinical-stage programs. The overall increase in R&D expenses was also attributable to increased R&D-related employee compensation expense, which was $10.72 million for the three months endedJune 30, 2018 , compared to$4.75 million for the same period in 2017, due to increased headcount and a higher share price. - SG&A Expenses for the three months ended June 30, 2018 were $45.16 million, compared to
$10.78 million in the same period in 2017. The increase in SG&A expenses was primarily attributable to increased headcount, including the expansion of our commercial team to support the distribution of our existing commercial products inChina and the potential launches of our late-stage drug candidates, higher professional service fees and costs to support our growing operations, and higher SG&A-associated share-based compensation expense which was $7.92 million for the three months endedJune 30, 2018 , compared to$2.33 million for the same period in 2017, due to increased headcount and a higher share price. - Net Loss for the second quarter of 2018 was $156.89 million, or
$2.92 per American Depositary Share (ADS), compared to a net loss of$60.55 million , or$1.52 per ADS in the same period in 2017. For the second quarter of 2018, net loss per ordinary share was$0.22 , compared to$0.12 in the same period in 2017.
Financial Summary
Select Condensed Consolidated Balance Sheet Data (
(Amounts in thousands of
| As of | |||||||
| 2018 | 2017 | ||||||
| (unaudited) | (audited) | ||||||
| Cash, cash equivalents, restricted cash and short-term investments | $ | 1,401,219 | $ | 837,516 | |||
| Accounts receivable | 33,171 | 29,428 | |||||
| Unbilled receivables | 12,702 | — | |||||
| Working capital | 1,330,272 | 763,509 | |||||
| Property and equipment, net | 90,510 | 62,568 | |||||
| Total assets | 1,653,856 | 1,046,479 | |||||
| Accounts payable | 85,878 | 69,779 | |||||
| Accrued expenses and other payables | 75,037 | 49,598 | |||||
| Bank loan [1] | 60,534 | 18,444 | |||||
| Shareholder loan [1] | 149,217 | 146,271 | |||||
| Total liabilities | 427,188 | 362,248 | |||||
| Noncontrolling interest | 13,471 | 14,422 | |||||
| Total equity | $ | 1,226,668 | $ | 684,231 | |||
[1] The bank loan and shareholder loan balances attributable to BeiGene Biologics, a joint venture that is 95% owned by
Condensed Consolidated Statements of Operations (
(Amounts in thousands of
| Three Months Ended | Six Months Ended | |||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||
| Revenue | ||||||||||||
| Product revenue, net | $ | 31,426 | $ | — | $ | 54,676 | $ | — | ||||
| Collaboration revenue | 21,378 | — | 30,672 | — | ||||||||
| Total revenues | 52,804 | — | 85,348 | — | ||||||||
| Expenses: | ||||||||||||
| Cost of sales – products | (6,256 | ) | — | (10,806 | ) | — | ||||||
| Research and development | (164,251 | ) | (47,245 | ) | (273,951 | ) | (90,018 | ) | ||||
| Selling, general and administrative | (45,160 | ) | (10,777 | ) | (74,075 | ) | (19,546 | ) | ||||
| Amortization of intangible assets | (187 | ) | — | (375 | ) | — | ||||||
| Total expenses | (215,854 | ) | (58,022 | ) | (359,207 | ) | (109,564 | ) | ||||
| Loss from operations | (163,050 | ) | (58,022 | ) | (273,859 | ) | (109,564 | ) | ||||
| Interest income (expense), net | 1,892 | (1,982 | ) | 3,444 | (1,796 | ) | ||||||
| Other income (expense), net | 75 | (475 | ) | 804 | 438 | |||||||
| Loss before income taxes | (161,083 | ) | (60,479 | ) | (269,611 | ) | (110,922 | ) | ||||
| Income tax (expense) benefit | 3,368 | (201 | ) | 6,780 | (381 | ) | ||||||
| Net loss | $ | (157,715 | ) | $ | (60,680 | ) | $ | (262,831 | ) | $ | (111,303 | ) |
| Less: Net loss attributable to noncontrolling interest | (828 | ) | (135 | ) | (1,348 | ) | (135 | ) | ||||
| Net loss attributable to | $ | (156,887 | ) | $ | (60,545 | ) | $ | (261,483 | ) | $ | (111,168 | ) |
| Net loss attributable to BeiGene, Ltd. per ADS, basic and diluted | $ | (2.92 | ) | $ | (1.52 | ) | $ | (4.97 | ) | $ | (2.80 | ) |
| Weighted-average ADSs outstanding, basic and diluted | 53,731,299 | 39,820,287 | 52,660,468 | 39,773,393 | ||||||||
| Net loss per share attributable to | ||||||||||||
| basic and diluted | (0.22 | ) | (0.12 | ) | (0.38 | ) | (0.22 | ) | ||||
| Weighted-average ordinary shares outstanding, basic and diluted | 698,506,891 | 517,663,736 | 684,586,086 | 517,054,109 | ||||||||
Condensed Consolidated Statements of Comprehensive Loss (
(Amounts in thousands of
| Three Months Ended | Six Months Ended | |||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||
| Net loss | $ | (157,715 | ) | $ | (60,680 | ) | $ | (262,831 | ) | $ | (111,303 | ) |
| Other comprehensive loss, net of tax of nil: | ||||||||||||
| Foreign currency translation adjustments | 2,033 | 554 | 2,305 | 644 | ||||||||
| Unrealized holding gain, net | 719 | 19 | 1,048 | 7 | ||||||||
| Comprehensive loss | (154,963 | ) | (60,107 | ) | (259,478 | ) | (110,652 | ) | ||||
| Less: Comprehensive loss attributable to noncontrolling interests | (870 | ) | (108 | ) | (1,326 | ) | (108 | ) | ||||
| Comprehensive loss | $ | (154,093 | ) | $ | (59,999 | ) | $ | (258,152 | ) | $ | (110,544 | ) |
About
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws, including statements regarding the encouraging clinical data for BeiGene’s product candidates and product revenue for its products; the advancement of and anticipated clinical development and regulatory milestones for its product candidates; and the expected milestones under the caption “Recent Business Highlights and Upcoming Milestones”. Actual results may differ materially from those indicated in the forward-looking statements as a result of various important factors, including
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