On February 9, 2021 Incyte (Nasdaq: INCY) reported 2020 fourth quarter and full year financial results, and provides a status update on the Company’s development portfolio (Press release, Incyte, FEB 9, 2021, View Source [SID1234574775]).
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"Our team achieved many important accomplishments in the past year. Revenue growth was strong, driven by demand for Jakafi (ruxolitinib), and the launches of Monjuvi (tafasitamab-cxix) and Pemazyre (pemigatinib) continue to gain momentum. During 2020, we also announced positive results across multiple late-stage programs, including the pivotal trials of ruxolitinib in chronic GVHD, ruxolitinib cream in atopic dermatitis, parsaclisib in NHL, and retifanlimab in SCAC," stated Hervé Hoppenot, Chief Executive Officer, Incyte. "During 2021, we expect regulatory decisions on seven applications seeking approval, including four in the U.S, two in Europe and one in Japan, and we are working towards the potential U.S. launch of ruxolitinib cream, which we expect to be approved by the FDA in the middle of the year."
Portfolio Updates
MPNs and GVHD – key highlights
Our LIMBER development program, to improve patient outcomes in MPNs and GHVD, is progressing well.
The two Phase 3 trials of ruxolitinib in combination with parsaclisib are both underway, evaluating the combination versus monotherapy ruxolitinib as a first-line therapy for patients with myelofibrosis (MF) (LIMBER-313) and as a therapy for MF patients with a suboptimal response to ruxolitinib monotherapy (LIMBER-304).
Monotherapy trials of INCB57643 (BET) and INCB00928 (ALK2) are underway, and are expected to lead to proof-of-concept combination trials of both agents with ruxolitinib in patients with myelofibrosis. A monotherapy trial of itacitinib (JAK1) in patients previously treated with ruxolitinib is ongoing.
In December 2020, Incyte and Cellenkos announced a development collaboration to investigate the combination of ruxolitinib and CK0804, Cellenkos’ cryopreserved CXCR4 enriched, allogeneic, umbilical cord blood-derived T-regulatory cells, in patients with myelofibrosis. In addition, Incyte obtained an exclusive option to acquire sole rights to develop and commercialize CK0804, and genetically-modified variants of CK0804, in benign and malignant hematology indications.
The sNDA seeking approval of Jakafi in steroid-refractory chronic graft-versus-host disease (GVHD) has been submitted, based on data from the successful results of the REACH3 trial, which were presented at ASH (Free ASH Whitepaper) 2020.
Indication and status
Once-a-day ruxolitinib
(JAK1/JAK2)
Myelofibrosis, polycythemia vera & GVHD: clinical pharmacology studies
ruxolitinib + parsaclisib
(JAK1/JAK2 + PI3Kδ)
Myelofibrosis: Phase 3 (first-line therapy) (LIMBER-313)
Myelofibrosis: Phase 3 (suboptimal responders to ruxolitinib) (LIMBER-304)
ruxolitinib + INCB57643
(JAK1/JAK2 + BET)
Myelofibrosis: Phase 2 in preparation
ruxolitinib + INCB00928
(JAK1/JAK2 + ALK2)
Myelofibrosis: Phase 2 in preparation
itacitinib
(JAK1)
Myelofibrosis: Phase 2 (low platelets)
ruxolitinib + CK08041
(JAK1/JAK2 + CB-Tregs)
Myelofibrosis: PoC in preparation
ruxolitinib
(JAK1/JAK2)
Steroid-refractory chronic GVHD2: sNDA submitted
itacitinib
(JAK1)
Treatment-naïve chronic GVHD: Phase 3 (GRAVITAS-309)
Development collaboration with Cellenkos
Clinical development of ruxolitinib in GVHD conducted in collaboration with Novartis
Other Hematology/Oncology – key highlights
Momentum is strong behind the U.S. launch of Monjuvi (tafasitamab-cxix), with good uptake in both academic and community settings and illustrated by the market share gained in the first several months since launch.
The Phase 3 inMIND trial evaluating tafasitamab plus lenalidomide and rituximab (R-squared) versus R-squared in patients with relapsed or refractory follicular or marginal zone lymphoma is open for recruitment, and the Phase 3 frontMIND trial of tafasitamab plus lenalidomide and R-CHOP versus R-CHOP as a first-line treatment in patients with DLBCL is expected to open in the coming months.
The U.S. launch of Pemazyre (pemigatinib) has been successful and, in January, Incyte announced that the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) issued a positive opinion recommending the conditional marketing authorization of pemigatinib for the treatment of adults with unresectable locally advanced or metastatic cholangiocarcinoma with an FGFR2 fusion or rearrangement that is relapsed or refractory, after at least one line of systemic therapy.
In December 2020, data from three ongoing Phase 2 studies evaluating parsaclisib for the treatment of patients with relapsed or refractory follicular (CITADEL-203), marginal zone (CITADEL-204) and mantle cell (CITADEL-205) lymphomas were presented at ASH (Free ASH Whitepaper) 2020. Data from the CITADEL program are expected to form the basis of an NDA seeking FDA approval of parsaclisib, which is expected to be submitted in the second half of 2021.
In January 2021, Incyte announced that the FDA had accepted for Priority Review its Biologics License Application (BLA) for retifanlimab as a treatment for previously treated patients with advanced squamous cell anal carcinoma (SCAC) who have progressed following standard platinum-based chemotherapy. The BLA submission was based on data from the Phase 2 POD1UM-202 trial evaluating retifanlimab in previously treated patients with advanced SCAC who have progressed following standard platinum-based chemotherapy; the Phase 3 POD1UM-303 trial in patients with SCAC is underway.
Indication and status
pemigatinib
(FGFR1/2/3)
CCA: Phase 2 (FIGHT-202), Phase 3 (FIGHT-302); J-NDA under review
8p11 MPN: Phase 2 (FIGHT-203)
Tumor agnostic: Phase 2 (FIGHT-207)
tafasitamab
(CD19)1
r/r DLBCL: Phase 2 (L-MIND); Phase 3 (B-MIND); MAA under review
1L DLBCL: Phase 1b (firstMIND); Phase 3 (frontMIND) in preparation
r/r FL and r/r MZL: Phase 3 (inMIND) open for recruitment
r/r B-cell malignancies: PoC with parsaclisib (PI3Kδ) in preparation
r/r B-cell malignancies: PoC with lenalidomide and plamotamab in preparation2
parsaclisib
(PI3Kδ)
r/r follicular lymphoma: Phase 2 (CITADEL-203)
r/r marginal zone lymphoma: Phase 2 (CITADEL-204)
r/r mantle cell lymphoma: Phase 2 (CITADEL-205)
retifanlimab
(PD-1)3
SCAC: Phase 2 (POD1UM-202); Phase 3 (POD1UM-303); BLA under review
MSI-high endometrial cancer: Phase 2 (POD1UM-101, POD1UM-204)
Merkel cell carcinoma: Phase 2 (POD1UM-201)
NSCLC: Phase 3 (POD1UM-304)
CCA = cholangiocarcinoma; DLBCL = diffuse large B-cell lymphoma; SCAC = squamous cell anal carcinoma; FL = follicular lymphoma; MZL = marginal zone lymphoma
Development of tafasitamab in collaboration with MorphoSys
Clinical collaboration with MorphoSys and Xencor, Inc. to investigate the combination of tafasitamab plus lenalidomide in combination with Xencor’s CD20xCD3 XmAb bispecific antibody, plamotamab.
retifanlimab licensed from MacroGenics
Incyte’s emerging clinical candidates in hematology/oncology include INCB86550, the first in a series of selective oral inhibitors of PD-L1; INCB81776, a dual AXL/MER inhibitor; INCB106385, an adenosine (A2A/A2B) inhibitor and, via a collaboration with Merus, MCLA-145, a PD-L1xCD137 bispecific antibody.
Inflammation and Autoimmunity (IAI) – key highlights
Dermatology
As planned, the NDA seeking approval of ruxolitinib cream as a treatment for patients with atopic dermatitis was submitted to the FDA late in the fourth quarter of 2020, including use of the previously acquired priority review voucher (PRV). The use of the PRV is expected to accelerate the time to an FDA decision.
Recruitment has been completed in both Phase 3 trials in the TRuE-V development program evaluating ruxolitinib cream as a treatment for patients with vitiligo, and topline results are expected to be announced in the first half of 2021. If successful, data from TRuE-V are expected to form the basis of an sNDA seeking approval of ruxolitinib cream as a treatment for patients with vitiligo, which would be submitted as soon as practicable after the FDA decision on the atopic dermatitis NDA.
Indication and status
ruxolitinib cream
(JAK1/JAK2)
Atopic dermatitis: NDA submitted
Vitiligo: Phase 3 (TRuE-V1, TRuE-V2; recruitment complete in both trials)
INCB54707
(JAK1)
Hidradenitis suppurativa: Phase 2b
parsaclisib
(PI3Kδ)
Autoimmune hemolytic anemia: Phase 2
INCB00928
(ALK2)
Fibrodysplasia ossificans progressiva: Phase 2 in preparation
Partnered – key highlights
In December 2020, Incyte and Lilly announced that Olumiant had been approved in Japan as a treatment of patients with atopic dermatitis who have inadequate response to conventional therapies.
Indication and status
baricitinib
(JAK1/JAK2)1
Atopic dermatitis: Phase 3 (BREEZE-AD); approved in EU and Japan
Systemic lupus erythematosus: Phase 3 (BRAVE I, BRAVE II)
Severe alopecia areata: Phase 3 (BRAVE-AA1, BRAVE-AA2)
capmatinib
(MET)2
NSCLC (with MET exon 14 skipping mutations): Approved as Tabrecta in U.S. and Japan
Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate-to-severe rheumatoid arthritis; approved as Olumiant in EU and Japan for certain patients with atopic dermatitis
Worldwide rights to capmatinib licensed to Novartis
Potential therapies for patients with COVID-19
In November 2020, Incyte and Lilly announced that the U.S. Food and Drug Administration (FDA) issued an Emergency Use Authorization (EUA) for the distribution and emergency use of baricitinib to be used in combination with remdesivir in hospitalized adult and pediatric patients two years of age or older with suspected or laboratory confirmed COVID-19 who require supplemental oxygen, invasive mechanical ventilation, or extracorporeal membrane oxygenation.
In December 2020, the New England Journal of Medicine published peer-reviewed results from the Adaptive COVID-19 Treatment Trial (ACTT-2) sponsored by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH). The Phase 3 study included 1,033 patients from 67 trial sites in eight countries. These results supported the EUA issued by the FDA.
Status
ruxolitinib
(JAK1/JAK2)
COVID-19 associated cytokine storm: Phase 3 (369-DEVENT)
baricitinib
(JAK1/JAK2)1
Hospitalized patients with COVID-19: Phase 3 (COV-BARRIER)
Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate-to-severe rheumatoid arthritis; approved as Olumiant in EU and Japan for certain patients with atopic dermatitis
2020 Fourth Quarter and Year-End Financial Results
The financial measures presented in this press release for the quarter and year ended December 31, 2020 and 2019 have been prepared by the Company in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), unless otherwise identified as a Non-GAAP financial measure. Management believes that Non-GAAP information is useful for investors, when considered in conjunction with Incyte’s GAAP disclosures. Management uses such information internally and externally for establishing budgets, operating goals and financial planning purposes. These metrics are also used to manage the Company’s business and monitor performance. The Company adjusts, where appropriate, for expenses in order to reflect the Company’s core operations. The Company believes these adjustments are useful to investors by providing an enhanced understanding of the financial performance of the Company’s core operations. The metrics have been adopted to align the Company with disclosures provided by industry peers.
Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used in conjunction with and to supplement Incyte’s operating results as reported under GAAP. Non-GAAP measures may be defined and calculated differently by other companies in our industry.
Product and Royalty Revenues Product and royalty revenues for the quarter and year ended December 31, 2020 increased 17% and 18%, respectively, over the prior year comparative periods primarily as a result of increases in Jakafi net product revenues, the launch of Pemazyre and higher product royalty revenues from Jakavi and Olumiant. Jakafi net product revenues for the quarter and year ended December 31, 2020 increased 11% and 15%, respectively, over the prior year comparative periods, primarily driven by growth in patient demand across all indications.
1. Non-GAAP cost of product revenues excludes the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the cost of stock-based compensation.
2. Non-GAAP research and development expenses exclude the cost of stock-based compensation.
3. Non-GAAP selling, general and administrative expenses exclude the cost of stock-based compensation.
4. Non-GAAP change in fair value of acquisition-related contingent consideration is null.
Research and development expenses GAAP and Non-GAAP research and development expense for the quarter ended December 31, 2020 increased 30% and 32%, respectively, compared to the same period in 2019 primarily due to our 55% share of the global and U.S. specific development costs for tafasitamab, product supply related costs to support the potential launch of ruxolitinib cream as a treatment for atopic dermatitis in 2021 and an increase in upfront and milestone payments under our collaborative agreements. Excluding the $42 million impact of product supply costs and the upfront and milestone payments, research and development expense for the quarter ended December 31, 2020 increased approximately 17% compared to the same period in 2019.
For the year ended December 31, 2020, GAAP and Non-GAAP research and development expense increased 92% and 101%, respectively, compared to the year ended December 31, 2019 primarily due to higher upfront and milestone payments under our collaborative agreements which includes upfront consideration of $805 million related to our collaborative agreement with MorphoSys, $120 million of expense related to the purchase of an FDA priority review voucher ("PRV") utilized to accelerate the FDA review of ruxolitinib cream in atopic dermatitis, our 55% share of the global and U.S. specific development costs for tafasitamab, and product supply costs to support the potential launch of ruxolitinib cream. Excluding the $1.02 billion impact of upfront consideration and milestone payments, purchase of the PRV and product supply related costs, research and development expense for the year ended December 31, 2020 increased approximately 4% compared with the prior year period.
Selling, general and administrative expenses GAAP and Non-GAAP selling, general and administrative expenses for the quarter ended December 31, 2020 increased 23% and 24%, respectively, compared to the same period in 2019, primarily due to the timing of certain expenses. GAAP and Non-GAAP selling, general and administrative expenses for the year ended December 31, 2020 increased 10% compared to the year ended December 31, 2019 primarily due to an increase in sales and marketing spend to support the commercialization of Pemazyre in the US and to prepare for the potential launch of ruxolitinib cream in the U.S. and pemigatinib and tafasitamab in the EU.
Other Financial Information
Operating income (loss) GAAP and Non-GAAP operating income for the quarter ended December 31, 2020 increased compared to the same period in 2019, due to the growth in total revenues exceeding the growth in operating expenses. For the year ended December 31, 2020, Incyte recorded an operating loss compared to operating income for the same period in 2019, on both a GAAP and Non-GAAP basis, primarily due to upfront consideration related to our collaboration with MorphoSys and expense related to the PRV, partially offset by the growth in product and royalty revenues.
Cash, cash equivalents and marketable securities position As of December 31, 2020 and 2019, cash, cash equivalents and marketable securities totaled $1.8 billion and $2.1 billion, respectively. The decrease is primarily due to the upfront payment and stock purchase related to our collaborative agreement with MorphoSys and purchase of the PRV, partially offset by the cash flow generated in 2020.
2021 Financial Guidance
Due to the continuing growth and diversification of Incyte’s commercial product portfolio, 2021 net product revenue guidance is being provided for Jakafi and in total for other Hematology/Oncology products, which currently include Iclusig in Europe and Pemazyre in the U.S. Guidance does not include revenue from any potential new product launches. However, GAAP and Non-GAAP selling, general and administrative expense guidance for 2021 includes costs to support the potential launches of ruxolitinib cream as a treatment for atopic dermatitis in the U.S., pemigatinib as a treatment for cholangiocarcinoma in the EU and Japan, and tafasitamab as a treatment for DLBCL in the EU. The 2021 financial guidance does not include the impact of any potential future strategic transactions.
(1) Adjusted to exclude the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the estimated cost of stock-based compensation.
(2) Adjusted to exclude the estimated cost of stock-based compensation.
Conference Call and Webcast Information
Incyte will hold a conference call and webcast this morning at 8:00 a.m. EDT. To access the conference call, please dial 877-407-3042 for domestic callers or 201-389-0864 for international callers. When prompted, provide the conference identification number, 13715042.
If you are unable to participate, a replay of the conference call will be available for 90 days. The replay dial-in number for the United States is 877-660-6853 and the dial-in number for international callers is 201-612-7415. To access the replay you will need the conference identification number, 13715042.
The conference call will also be webcast; the livestream and the replay can be accessed at investor.incyte.com.