On November 7, 2017 MannKind Corporation (NASDAQ:MNKD) reported financial results for the third quarter and the nine months ended September 30, 2017. Third quarter highlights include (Press release, Mannkind, NOV 7, 2017, View Source [SID1234521715]):

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Afrezza net revenue grew 28% and 246% vs. 2Q 2017 and 3Q 2016, respectively
Cash burn of $23.3 million in 3Q 2017
Exchanged all outstanding Series A and B Common Stock Warrants for an aggregate of 1.3 million shares of the Company’s common stock
FDA approved label changes for Afrezza
Other recent highlights include:

Issued 10.2 million shares of the Company’s common stock in a registered direct offering resulting in receipt of net proceeds of $57.7 million
Exchanged senior convertible notes of $27.7 million due August 2018 for senior convertible notes of $23.7 million due October 2021 and 973,236 shares of the Company’s common stock
Extended the maturity of $10 million of the Deerfield obligation from October 31, 2017 to January 15, 2018
Allowed for certain outstanding principal under the Deerfield obligation to be converted into shares of the Company’s common stock (including the $10 million due January 2018). 4 million shares have been reserved for conversion.
Third Quarter Results

For the third quarter of 2017, Afrezza net revenue of $2.0 million grew 28% vs. the second quarter of 2017 and 246% vs. the third quarter of 2016 (the first quarter for MannKind sales and commercial support of Afrezza after the termination of the Sanofi agreement). As of September 30, 2017, the amount of Afrezza shipped to the wholesale and retail channels, but not yet recognized as revenue, was $3.0 million, an increase of $0.4 million from June 30, 2017. A reconciliation of gross to net revenues can be found in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of the Form 10-Q for the quarter ended September 30, 2017.

Cost of goods sold was $4.6 million in the third quarter of 2017 compared to (i) $5.1 million in the second quarter of 2017, a decrease of $0.5 million primarily related to a write-down of inventory in the second quarter, and (ii) $4.4 million in the third quarter of 2016, an increase of $0.2 million.

Research and development expenses were $4.4 million in the third quarter of 2017 compared to (i) $3.1 million in the second quarter of 2017, an increase of $1.3 million primarily related to starting the Time in Range ("STAT" study) and the pediatric study, and (ii) $4.0 million in the third quarter of 2016, an increase of $0.4 million, primarily due to increases in clinical trials partially offset by a decrease in compensation expense related to a reduction in workforce in the fourth quarter of 2016.

Selling, general and administrative expenses were $17.7 million for the third quarter of 2017 compared to (i) $18.6 million for the second quarter of 2017, a decrease of $1.1 million primarily from a reduction in commercial support expenses and (ii) $13.1 million in the third quarter of 2016, an increase of $4.6 million primarily due to scaling up the Afrezza commercial infrastructure during the first quarter of 2017.

The net loss for the third quarter of 2017 was $32.9 million, or a loss of $0.31 per share based on 104.7 million weighted average shares outstanding, compared to net income of $126.5 million, or $1.32 per share on 95.6 million weighted average shares outstanding in the third quarter of 2016. The net income in the third quarter of 2016 included net revenue – collaboration of $161.8 million related to the termination of the Sanofi agreement.

Nine Months Results

Due to the termination of the Sanofi agreement in early 2016 and MannKind’s commencement of commercial activities for Afrezza in the third quarter of 2016, a comparative analysis for sales and commercial support between the nine months ended September 30, 2017 and September 30, 2016 is not meaningful.

For the nine months ended September 30, 2017, total net revenue of $7.2 million was comprised of $4.7 million of Afrezza net sales, $1.7 million from the net sales of surplus bulk insulin to a third party, $0.6 million from the sale of certain oncology intellectual property, and $0.2 million from collaboration net revenue.

Cost of goods sold was $12.2 million for the nine months ended September 30, 2017 compared to $12.9 million for the same period in 2016, a decrease of $0.7 million.

Research and development expenses were $10.6 million for the nine months ended September 30, 2017 compared to $13.4 million for the same period in 2016, a decrease of $2.7 million or 21%, due primarily to a decrease in compensation expense of $5.1 million as a result of the reduction in workforce in the fourth quarter of 2016. This decrease was partially offset by a $2 million increase in clinical trial expense.

Selling, general and administrative expenses were $51.7 million for the nine months ended September 30, 2017 compared to $31.6 million for the same period in 2016, an increase of $20.1 million due to the change in the commercial support structure after termination of the Sanofi agreement in 2016.

The net loss for the nine months ended September 30, 2017 was $84.5 million, or a loss of $0.84 per share based on 100.1 million weighted average shares outstanding, compared to net income of $71.7 million, or $0.79 per share on 90.8 million weighted average shares outstanding at September 30, 2016.

Cash and Cash Equivalents

Cash and cash equivalents at September 30, 2017 decreased to $20.1 million from $43.4 million at June 30, 2017, primarily due to cash burn for the third quarter of 2017 of $23.3 million. The cash balance as of September 30, 2017 does not include $57.7 million of net proceeds received from the registered direct offering of the Company’s common stock completed in October 2017.

Afrezza Label Change

On September 29, 2017, the U.S. FDA approved an update to the Afrezza prescribing information for the inclusion of study data that describes the time action profile by dosage strength; clarity on "Starting" and "Adjusting" mealtime doses; and updated pregnancy and lactation guidance.

Conference Call

MannKind will host a conference call and presentation webcast to discuss these results today at 5:00 p.m. Eastern Time. To view and listen to the earnings call webcast, visit MannKind’s website at View Source and click on the "Q3 2017 MannKind Earnings Conference Call" link in the Webcast section of News & Events. To participate in the live call by telephone, please dial (888) 771-4371 or (847) 585-4405 and use the participant passcode: 44096374.

A telephone replay will be accessible for approximately 14 days following completion of the call by dialing (888) 843-7419 or (630) 652-3042 and use the participant passcode: 4409 6374#. A replay will also be available on MannKind’s website for 14 days.

On November 7, 2017 Alder BioPharmaceuticals, Inc. (NASDAQ: ALDR), a clinical-stage biopharmaceutical company developing monoclonal antibody therapeutics, reported financial results for the third quarter ended September 30, 2017, and provided a corporate update (Press release, Alder Biopharmaceuticals, NOV 7, 2017, View Source [SID1234521711]).

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"In the third quarter, we continued to showcase the positive results of eptinezumab, our lead pivotal-stage product candidate for the prevention of migraine, and recently had seven presentations at the 18th Congress of the International Headache Society," said Randall C. Schatzman, Ph.D., president and chief executive officer of Alder. "We are encouraged by the migraine community’s excitement regarding eptinezumab’s unique clinical profile, including migraine prevention as early as Day 1 and >75% responder rates achieved by month one and sustained for three months from one administration. As the first-to-market anti-CGRP infusion therapy, we are confident that eptinezumab can address a distinct market segment of five million of the most severe episodic and chronic patients who are heavily impacted by migraine. Importantly, we remain on track to announce top-line data our PROMISE 2 Phase 3 pivotal trial in the first half of 2018 and complete our planned BLA submission in the second half of 2018. We look forward to delivering on our mission to transform the treatment of migraine and creating long-term value for our shareholders."

Recent Corporate Highlights

•
Completed patient enrollment in PROMISE 2 (Prevention Of Migraine via Intravenous eptinezumab Safety and Efficacy 2), the Company’s ongoing Phase 3 pivotal trial evaluating the safety and efficacy of eptinezumab administered via infusion once every three months in approximately 1,050 patients with chronic migraine.

•
Delivered seven presentations at the 18th Congress of the International Headache Society (IHC) in Vancouver, Canada in September 2017 providing clinical data and analyses for eptinezumab, including additional Phase 3 data from the PROMISE 1 Phase 3 pivotal trial and analyses of Alder’s Phase 2b clinical trial. The data presented further supported eptinezumab’s clinical profile as a potential first-of-its-kind, highly differentiated infusion therapy to prevent migraine.

Upcoming Milestones

•
Report top-line data from the PROMISE 2 pivotal trial in the first half of 2018.

•
Submit the BLA for eptinezumab with the U.S. Food and Drug Administration (FDA) in the second half of 2018.

Third Quarter 2017 Financial Results

Research and development expenses for the quarter ended September 30, 2017 totaled $52.2 million, compared to $29.5 million for the same period in 2016. This increase over the same period last year reflects the company’s commitment to advancing the pivotal-stage eptinezumab program and commercialization preparations.

General and administrative expenses for the quarter ended September 30, 2017 totaled $8.2 million, compared to $6.2 million for the same period in 2016. The increases in spending were primarily due to an increase in stock-based compensation expense and salaries due to headcount growth, and an increase in professional fees and other administrative costs primarily to support commercial readiness activities.

Net loss for the quarter ended September 30, 2017 totaled $59.6 million, or $0.92 per share, compared to net loss of $35.1, or $0.70 per share, on a fully-diluted basis, for the same period in 2016.

Cash, cash equivalents, short-term investments and restricted cash totaled $340.9 million as of September 30, 2017, compared to $224.5 million as of June 30, 2017.

Financial Outlook

Alder estimates its available cash and cash equivalents and short-term investments, will be sufficient to meet the company’s projected operating requirements through late 2018/early 2019 and enable the Company to achieve the planned BLA submission for eptinezumab and other key eptinezumab activities.

Conference Call and Webcast

Alder will host a conference call today at 5:00 p.m. ET to discuss these financial results and recent corporate highlights. The live call may be accessed by dialing (877) 430-4657 for domestic callers or (484) 756-4339 for international callers, and providing conference ID number 4399736. The webcast will be broadcast live and can be accessed from the Events & Presentations page in the Investors section of Alder’s website at www.alderbio.com. The webcast will be available for replay following the call for 30 days.

On November 7, 2017 Five Prime Therapeutics, Inc. (NASDAQ: FPRX), a clinical-stage biotechnology company focused on discovering and developing innovative immuno-oncology protein therapeutics, reported that it will host a conference call and live audio webcast on Wednesday, November 8, 2017, at 8:00 a.m. (ET) to review data from the Phase 1a/1b clinical trial evaluating the immunotherapy combination of its CSF-1R antibody, cabiralizumab (FPA008), with Opdivo (nivolumab), Bristol-Myers Squibb’s PD-1 immune checkpoint inhibitor. An abstract of the data has been selected for a late-breaking oral presentation on Saturday, November 11, 2017, at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 32nd Annual Meeting in National Harbor, Maryland. The late-breaking abstracts were published today by SITC (Free SITC Whitepaper) (Press release, Five Prime Therapeutics, NOV 7, 2017, View Source [SID1234521676]).

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Five Prime originally intended to host the call and webcast on November 7, 2017, but an extended GlobeNewswire outage prevented a press release from being issued. In advance of the event tomorrow, Five Prime will file a Current Report on Form 8-K with the Securities and Exchange Commission that will include the slides to accompany the conference call presentation and discussion. Five Prime’s management will provide important additional details during the call.

The live audio webcast may be accessed through the "Events & Presentations" page in the "Investors" section of the company’s website at www.fiveprime.com. Alternatively, participants may dial (877) 878-2269 (domestic) or (253) 237-1188 (international) and refer to conference ID 8687899.

The archived conference call will be available on Five Prime’s website beginning approximately two hours after the event and will be archived and available for replay for at least 30 days after the event.

On November 7, 2017 Halozyme Therapeutics, Inc. (NASDAQ: HALO), a biotechnology company developing novel oncology and drug-delivery therapies, reported financial results and recent highlights for the third quarter ended September 30 (Press release, Halozyme, NOV 7, 2017, View Source/investors/news-releases/news-release-details/2017/Halozyme-Reports-Third-Quarter-2017-Results/default.aspx" target="_blank" title="View Source/investors/news-releases/news-release-details/2017/Halozyme-Reports-Third-Quarter-2017-Results/default.aspx" rel="nofollow">View Source [SID1234521677]).

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"During the third quarter, we realized clear benefits from strategies we have been executing against in both the ENHANZE and PEGPH20 pillars of our business," said Dr. Helen Torley, president and chief executive officer. "On ENHANZE we significantly increased 2017 revenue and the potential future value of the technology with the signing of the landmark collaboration agreement with Bristol-Myers Squibb for development of up to 11 immuno-oncology targets, and with the expansion of our collaboration agreement with Roche. In addition, our partner Janssen took an important step towards the commercialization of a subcutaneous formulation of Darzalex with the initiation of a Phase 3 study.

"In our PEGPH20 pillar, investigator interest remains strong in our HALO-301 study, resulting in continued progress with enrollment. An interim analysis will be conducted for the first primary endpoint of progression-free survival when we achieve the target number of events, which we project will occur in late Q4 2018."

Third Quarter 2017 and Recent Highlights include:

Announcing a Global Collaboration and License Agreement with Bristol-Myers Squibb to develop subcutaneously administered Bristol-Myers Squibb immuno-oncology medicines using Halozyme’s ENHANZE drug-delivery technology. The agreement is the largest in company history including a $105 million upfront payment and $160 million in potential milestones for each of 11 immuno-oncology targets, including the initial target selection of programmed death 1 (PD-1).
Roche licensing a new ENHANZE target in exchange for a $30 million upfront payment and up to $160 million in potential development, regulatory and sales-based milestones. The agreement serves as an extension to the original collaboration between the companies, under which Roche has developed two subcutaneous formulations of cancer drugs for markets worldwide.
Janssen initiating the first of three planned Phase 3 studies of the subcutaneous formulation of DARZALEX (daratumumab). Halozyme’s ENHANZE technology has the potential to enable a 15 ml injection to be delivered in five minutes or less, with no requirement for an intravenous loading dose. Data informing this decision from the Phase 1 PAVO study in patients with relapsed or refractory multiple myeloma were accepted for presentation at the 2017 American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition. Upon the dosing of the third patient in the recently initiated study, Halozyme will earn a $15 million milestone payment.
Genentech launching RITUXAN HYCELA (rituximab/hyaluronidase human) for subcutaneous injection, a combination of rituximab and Halozyme’s hyaluronidase human ENHANZE technology, for patients with follicular lymphoma, diffuse large B-cell lymphoma and chronic lymphocytic leukemia.
Continued progress screening and enrolling patients in the HALO-301 study of PEGPH20 in combination with ABRAXANE (nab-paclitaxel) and gemcitabine in first line metastatic pancreas cancer patients with high levels of tumor hyaluronan (HA-High). An interim analysis will be conducted for the first primary endpoint of progression-free survival when the target number of events has been reached, which the company projects will be in late Q4 2018. At that time, Halozyme projects approximately 500 patients will have been enrolled in the study.
Initiating multiple trials in collaboration with Genentech to evaluate PEGPH20 in combination with TECENTRIQ (atezolizumab) in four tumor types. Studies include a Halozyme-sponsored randomized clinical trial in patients with previously untreated, unresectable, locally advanced, or metastatic cholangiocarcinoma and gallbladder adenocarcinoma and two Genentech-funded and operated, Phase 1b/2 multi-arm clinical studies evaluating patients with previously treated metastatic pancreatic ductal adenocarcinoma and previously treated locally advanced unresectable or metastatic gastric cancer. The studies are part of a clinical collaboration agreement announced in 2016 to evaluate PEGPH20 and atezolizumab in up to eight tumor types.
Third Quarter 2017 Financial Highlights

Revenue for the third quarter was $63.7 million compared to $31.9 million for the third quarter of 2016. The year-over-year increase was driven by a $30 million upfront payment from Roche and growth in royalties from partner sales of Herceptin (trastuzumab) SC, MabThera (rituximab) SC and HYQVIA (Immune Globulin Infusion 10% (Human) with Recombinant Human Hyaluronidase) offset by a decrease in research and development reimbursements and license payments from ENHANZE partners. Revenue for the third quarter included $17.1 million in royalties, an increase of 31 percent from the prior-year period, $9.8 million in sales of bulk rHuPH20 primarily for use in manufacturing collaboration products and $3.8 million in HYLENEX recombinant (hyaluronidase human injection) product sales.
Research and development expenses for the third quarter were $34.0 million, compared to $33.9 million for the third quarter of 2016. The increase was primarily due to a ramp in spending associated with the HALO-301 study.
Selling, general and administrative expenses for the third quarter were $13.3 million, compared to $11.6 million for the third quarter of 2016. The increase was primarily due to personnel expenses, including stock compensation, for the period.
Net income for the third quarter was $2.7 million, or $0.02 per share, compared to net loss in the third quarter of 2016 of $28.9 million, or $0.23 per share.
Cash, cash equivalents and marketable securities were $316.9 million at September 30, 2017, compared to $297.5 million at June 30, 2017.
Financial Outlook for 2017

Halozyme updated year-end guidance, now expecting:

Net revenue increasing from the prior range of $245 million to $260 million announced on Sept. 14 to $265 million to $280 million, driven by stronger product sales, royalties, and sponsored research;
Operating expenses decreasing from the prior range of $240 million to $250 million to $230 million to $240 million;
Positive operating cash flow increasing from the prior range of $50 million to $60 million to $70 million to $85 million;
Year-end cash balance increasing from the prior range of $380 million to $395 million to $400 million to $415 million.
Webcast and Conference Call

Halozyme will webcast its Quarterly Update Conference Call for the third quarter of 2017 today, Tuesday, November 7 at 4:30 p.m. ET/1:30 p.m. PT. Dr. Helen Torley, president and chief executive officer, will lead the call. The call will be webcast live through the "Investors" section of Halozyme’s corporate website and a recording will be made available following the close of the call. To access the webcast and additional documents related to the call, please visit View Source approximately fifteen minutes prior to the call to register, download and install any necessary audio software. The call may also be accessed at (877) 410-5657 (domestic callers) (334) 323-7224 (international callers) using passcode 769890. A telephone replay will be available after the call by dialing (877) 919-4059 (domestic callers) or (334) 323-0140 (international callers) using replay ID number 19320711.

On November 7, 2017 Jazz Pharmaceuticals plc (Nasdaq: JAZZ) reported financial results for the third quarter of 2017 and updated financial guidance for 2017 (Press release, Jazz Pharmaceuticals, NOV 7, 2017, View Source;p=RssLanding&cat=news&id=2315108 [SID1234521680]).

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"The third quarter of 2017 was highlighted by the approval and strong launch of Vyxeos in the U.S. for the treatment of adult patients with newly-diagnosed high-risk AML, leading to our increase in 2017 Vyxeos sales guidance," said Bruce Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals. "While Xyrem has experienced lower than expected growth in 2017, and we are slightly decreasing our annual sales guidance accordingly, we remain confident in our ability to address the key drivers impacting Xyrem to position the product for solid future growth."

GAAP net income for the third quarter of 2017 was $63.5 million, or $1.03 per diluted share, compared to $89.8 million, or $1.45 per diluted share, for the third quarter of 2016. GAAP net income for the third quarter of 2017 included an upfront payment of $75.0 million to ImmunoGen, Inc. related to a collaboration and option agreement.

Adjusted net income for the third quarter of 2017 was $197.6 million, or $3.22 per diluted share, compared to $161.2 million, or $2.61 per diluted share, for the third quarter of 2016.

The tax provision and the effective tax rate for the third quarter of 2017 on both a GAAP and non-GAAP basis were favorably impacted by certain tax benefits. For further information, see "Operating Expenses and Income Tax Provision" below. Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included at the end of this press release.

Financial Highlights

Three Months Ended
September 30,

Nine Months Ended
September 30,

(In thousands, except per share amounts and percentages)
2017

2016

Change

2017

2016

Change
Total revenues
$
411,855

$
374,181

10
%

$
1,182,294

$
1,091,352

8
%
GAAP net income
$
63,526

$
89,828

(29)
%

$
255,641

$
280,142

(9)
%
Adjusted net income
$
197,649

$
161,153

23
%

$
496,225

$
461,525

8
%
GAAP EPS
$
1.03

$
1.45

(29)
%

$
4.17

$
4.51

(8)
%
Adjusted EPS
$
3.22

$
2.61

23
%

$
8.09

$
7.43

9
%
Total Revenues

Three Months Ended
September 30,

Nine Months Ended
September 30,
(In thousands)
2017

2016

2017

2016
Xyrem (sodium oxybate) oral solution
$
303,870

$
285,907

$
874,222

$
816,412

Erwinaze / Erwinase (asparaginase Erwinia chrysanthemi)
49,173

42,986

149,585

143,907

Defitelio (defibrotide sodium) / defibrotide
31,213

28,137

97,351

79,280

VyxeosTM (daunorubicin and cytarabine) liposome for injection
9,719

—

9,719

—

Prialt (ziconotide) intrathecal infusion
7,930

8,783

21,303

23,065

Other
6,066

5,808

19,124

21,983

Product sales, net
407,971

371,621

1,171,304

1,084,647

Royalties and contract revenues
3,884

2,560

10,990

6,705

Total revenues
$
411,855

$
374,181

$
1,182,294

$
1,091,352

Net product sales increased 10% in the third quarter of 2017 compared to the same period in 2016 primarily due to an increase in net product sales of our lead marketed products.

Xyrem net product sales increased 6% in the third quarter of 2017 compared to the same period in 2016. Xyrem net product sales growth in the 2017 period was negatively impacted by payer mix, one fewer shipping day, and operational changes that delayed some prescription fulfillment.

Erwinaze/Erwinase net product sales increased 14% in the third quarter of 2017 compared to the same period in 2016. The company experienced supply disruptions during both periods; however, net product sales were higher in the third quarter of 2017 compared to the same period in 2016 due to the timing of product availability. The company expects that additional supply disruptions may occur in 2017 and into 2018.

Defitelio/defibrotide net product sales increased 11% in the third quarter of 2017 compared to the same period in 2016 primarily due to an increase in U.S. net product sales. The company expects continued inter-quarter variability in Defitelio net sales given that veno-occlusive disease is an ultra-rare disease.

Vyxeos net product sales in the third quarter of 2017 were $9.7 million. Vyxeos launched in the U.S. on August 11, 2017.

Operating Expenses and Income Tax Provision

Three Months Ended
September 30,

Nine Months Ended
September 30,
(In thousands, except percentages)
2017

2016

2017

2016
GAAP:

Cost of product sales
$
31,203

$
24,311

$
84,940

$
71,730

Gross margin
92.4
%

93.5
%

92.7
%

93.4
%
Selling, general and administrative
$
124,523

$
124,368

$
401,106

$
375,751

% of total revenues
30.2
%

33.2
%

33.9
%

34.4
%
Research and development
$
47,362

$
47,796

$
132,447

$
118,139

% of total revenues
11.5
%

12.8
%

11.2
%

10.8
%
Acquired in-process research and development
$
75,000

$
15,000

$
77,000

$
23,750

Income tax provision
$
1,239

$
26,437

$
65,914

$
100,888

Effective tax rate
1.9
%

22.7
%

20.5
%

26.5
%

Three Months Ended
September 30,

Nine Months Ended
September 30,
(In thousands, except percentages)
2017

2016

2017

2016
Non-GAAP adjusted:

Cost of product sales
$
29,630

$
22,963

$
80,594

$
68,620

Gross margin
92.7
%

93.8
%

93.1
%

93.7
%
Selling, general and administrative
$
103,620

$
94,534

$
333,524

$
296,633

% of total revenues
25.2
%

25.3
%

28.2
%

27.2
%
Research and development
$
42,712

$
43,323

$
118,796

$
106,847

% of total revenues
10.4
%

11.6
%

10.0
%

9.8
%
Income tax provision
$
24,410

$
38,500

$
104,307

$
129,663

Effective tax rate
11.0
%

19.3
%

17.4
%

21.9
%
Operating expenses changed over the prior year period primarily due to the following:

Selling, general and administrative (SG&A) expenses increased in the third quarter of 2017 compared to the same period in 2016 on a GAAP and on a non-GAAP adjusted basis due to higher headcount and other expenses resulting from the expansion of the company’s business, including the launch of Vyxeos in the U.S. SG&A expenses in the third quarter of 2016 on a GAAP basis included transaction and integration costs of $10.3 million.
Research and development (R&D) expenses were consistent on a GAAP and on a non-GAAP adjusted basis in the third quarter of 2017 compared to the same period in 2016. R&D expenses in the third quarter of 2017 reflected an increase in expenses related to the company’s ongoing clinical development programs and regulatory activities, including an increase in headcount, and a decrease in JZP-110 costs following the completion of three Phase 3 studies this year.
The tax provision and the effective tax rate for the third quarter of 2017 on both a GAAP and non-GAAP basis were favorably impacted by the release of a valuation allowance held against certain foreign net operating losses and the release of reserves related to uncertain tax positions upon the expiration of a statute of limitation.

Cash Flow and Balance Sheet
As of September 30, 2017, cash, cash equivalents and investments were $452.6 million, and the outstanding principal balance of the company’s long-term debt was $1.8 billion. In the third quarter of 2017, the company sold $575.0 million aggregate principal amount of 1.50% exchangeable senior notes due 2024 and used the net proceeds to repay $500.0 million of outstanding borrowings under the company’s revolving credit facility. During the nine months ended September 30, 2017, the company repaid a total of $850.0 million of borrowings under the company’s revolving credit facility, made an upfront payment of $75.0 million to ImmunoGen, Inc. and used $56.4 million to repurchase approximately 398,000 ordinary shares under the company’s share repurchase program at an average cost of $141.73 per ordinary share.

Recent Developments

In August 2017, the company and ImmunoGen, Inc. entered into a collaboration and option agreement granting the company rights to opt into exclusive, worldwide licenses to develop and commercialize two early-stage, hematology-related antibody-drug conjugate (ADC) programs, as well as an additional program to be designated during the term of the agreement. The programs covered under the agreement include IMGN779, a CD33-targeted ADC for the treatment of acute myeloid leukemia (AML) in Phase 1 testing, and IMGN632, a CD123-targeted ADC for hematological malignancies expected to enter clinical testing before the end of the year.
In November 2017, the company submitted a Marketing Authorization Application (MAA) for Vyxeos to the European Medicines Authority (EMA) for the treatment of high-risk AML patients. Separately, the EMA granted Vyxeos an accelerated assessment review and the UK Medicines and Healthcare Products Regulatory Agency granted Vyxeos the Promising Innovative Medicine designation.
2017 Financial Guidance
Jazz Pharmaceuticals is updating its full year 2017 financial guidance as follows (in millions, except per share amounts and percentages):

Revenues
$1,600-$1,650
Total net product sales
$1,590-$1,630
-Xyrem net sales
$1,180-$1,200
-Erwinaze/Erwinase net sales
$200-$215
-Defitelio/defibrotide net sales
$130-$150
-Vyxeos net sales
$20-$30
GAAP gross margin %
93%
Non-GAAP adjusted gross margin %1,4
93%
GAAP SG&A expenses
$521-$551
Non-GAAP adjusted SG&A expenses2,4
$440-$460
GAAP R&D expenses
$180-$200
Non-GAAP adjusted R&D expenses3,4
$165-$180
GAAP net income per diluted share
$5.30-$6.30
Non-GAAP adjusted net income per diluted share4
$10.70-$11.20

1.
Excludes $5 million of share-based compensation expense from estimated GAAP gross margin.
2.
Excludes $75-$85 million of share-based compensation expense and $6 million of expenses related to certain legal proceedings and restructuring from estimated GAAP SG&A expenses.
3.
Excludes $15-$20 million of share-based compensation expense from estimated GAAP R&D expenses.
4.
See "Non-GAAP Financial Measures" below. Reconciliations of non-GAAP adjusted guidance measures are included above and in the table titled "Reconciliation of GAAP to Non-GAAP Adjusted 2017 Net Income Guidance" at the end of this press release.
Conference Call Details
Jazz Pharmaceuticals will host an investor conference call and live audio webcast today at 4:30 p.m. EST (9:30 p.m. GMT) to provide a business and financial update and discuss its 2017 third quarter results. The live webcast may be accessed from the Investors section of the company’s website at www.jazzpharmaceuticals.com. Please connect to the website prior to the start of the conference call to ensure adequate time for any software downloads that may be necessary. Investors may participate in the conference call by dialing +1 855 353 7924 in the U.S., or +1 503 343 6056 outside the U.S., and entering passcode 95499424.

A replay of the conference call will be available through November 14, 2017 by dialing +1 855 859 2056 in the U.S., or +1 404 537 3406 outside the U.S., and entering passcode 95499424. An archived version of the webcast will be available for at least one week in the Investors section of the company’s website at www.jazzpharmaceuticals.com.