On April 28, 2021 OPKO Health, Inc. (NASDAQ: OPK) reported that business highlights and financial results for the three months ended March 31, 2021 (Press release, Opko Health, APR 28, 2021, View Source [SID1234578634]).
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Business Highlights
BioReference Laboratories test volume increased 158% compared with the first quarter of 2020. During the first quarter of 2021, BioReference Laboratories (BRL) processed approximately 4.3 million COVID-19 PCR tests and has current capacity to process more than 100,000 PCR tests per day. In addition, during the quarter, BRL performed approximately 200,000 COVID-19 serology tests to measure SARS-CoV-2 antibody levels and currently has significant additional capacity.
BRL continues to provide COVID-19 solutions to meet the testing needs of physicians, health systems, long-term care facilities, governments, schools, employers, professional sports leagues and entertainment venues, as well as the general public through relationships with retail pharmacy chains including Rite-Aid and CVS. In April 2021, BRL announced a COVID-19 testing agreement for players and staff, stadium employees and league staff for the 2021 Major League Baseball season and the renewal of a similar agreement for the 2021 Major League Soccer season.
In March 2021, BRL announced expansion of its COVID-19 school testing program to support return to in-person classroom instruction across the country. For two of the nation’s largest school systems, BRL provides testing services to nearly 200 schools every day and has tested nearly 500,000 public school students, teachers and principals.
Topline results reported from first cohort of Phase 2 trial with Rayaldee in patients with stage 5 chronic kidney disease (CKD) on dialysis. Cohort 1 of the Phase 2 clinical trial explored the safety and efficacy of a high-strength formulation of Rayaldee (calcifediol) as a new treatment for secondary hyperparathyroidism (SHPT) in adults with vitamin D insufficiency and stage 5 CKD who require hemodialysis. Topline results from 44 subjects (33 Rayaldee; 11 placebo) demonstrated that the prohormone Rayaldee was well tolerated at a dose of 900 mcg/week, decreased intact parathyroid hormone (iPTH) versus placebo, and was activated to calcitriol (the active hormone) despite the lack of functional kidneys. A full analysis of the data is underway and will be reviewed with both FDA and OPKO’s development partners.
Regulatory submission for somatrogon by Pfizer, OPKO’s commercial partner, accepted by the European Medicines Agency (EMA). In February 2021, the EMA validated for review the Marketing Authorization Application (MAA) for somatrogon, a long-acting recombinant human growth hormone intended to be administered once-weekly to treat pediatric patients with growth hormone deficiency (GHD). Pfizer expects a decision from the European Commission in 2022. In January 2021, the FDA accepted for filing the initial Biologics License Application for somatrogon with a target Prescription Drug User Fee Act action date in October 2021. Pfizer also submitted a New Drug Application for somatrogon to the Pharmaceuticals and Medical Devices Agency in Japan.
Multiple presentations highlighting somatrogon clinical data were presented at two endocrinology conferences. Data from OPKO’s somatrogon clinical studies were presented virtually at ENDO 2021, the Endocrine Society’s 2021 Annual Meeting held March 20-23, 2021, and at ICE 2021, the 19th International Congress of Endocrinology Annual Meeting held February 24-28, 2021. Utilizing OPKO’s proprietary long-acting technology, somatrogon represents a significant advancement to increase patient adherence and improve quality of life compared with daily injections. Posters and abstracts from the endocrinology conferences can be viewed on the Company’s website in the Investors section. In addition, OPKO will be participating in the 2021 Pediatric Endocrine Society Virtual Annual Meeting to be held today through May 3, 2021.
Phase 2 trial with RAYALDEE in COVID-19 outpatients is 71% enrolled and ongoing at 10 U.S. sites. The trial is a randomized, double-blind, placebo-controlled study and is expected to enroll approximately 160 outpatients, including some with stage 3 or 4 CKD who are at higher risk for developing more severe illness. The qualified outpatients are being randomized one-to-one to four weeks of daily treatment with either RAYALDEE or placebo, and then monitored for another two weeks. Topline data from this trial are expected in the third quarter and, if sufficiently positive, will form the basis for an immediate request to FDA for an Emergency Use Authorization.
First Quarter Financial Results
Consolidated revenues for the first quarter of 2021 were $545.2 million compared with $211.5 million for the comparable period of 2020. Net income for the first quarter of 2021 was $31.1 million, or $0.05 per diluted share, compared with a net loss of $59.1 million, or $0.09 per share, for the comparable period of 2020.
Diagnostics: Revenue from services in the first quarter of 2021 increased to $507.0 million from $170.8 million in the prior-year period, primarily due to COVID-19 testing, partially offset by lower revenue in our base testing business reflecting the negative impact of the COVID-19 pandemic. Total costs and expenses were $439.9 million in the first quarter of 2021 compared with $189.0 million in the first quarter of 2020, resulting in operating income of $67.0 million compared with an operating loss of $18.1 million in the 2020 period. The increase in operating income of $85.1 million reflects the increased demand for COVID-19 PCR testing.
Pharmaceuticals: Revenue from products in the first quarter of 2021 was $33.9 million compared with $31.1 million in the first quarter of 2020, primarily attributable to an increase in sales at OPKO Chile and FineTech, partially offset by a decline in sales of RAYALDEE, which were negatively impacted by the COVID-19 pandemic. Total prescriptions of RAYALDEE for the first quarter of 2021 decreased to approximately 12,300 from approximately 18,300 for the first quarter of 2020. Revenue from the transfer of intellectual property was $4.3 million in the first quarter of 2021 compared with $9.6 million in the first quarter of 2020, reflecting a decrease in the amortization of payments received from Pfizer with respect to somatrogon. Total costs and expenses were $57.4 million in the first quarter of 2021 compared with $54.8 million in the prior-year period, primarily due to increased sales and an inventory reserve for RAYALDEE. The operating loss was $19.2 million in the first quarter of 2021 compared with $14.1 million in the first quarter of 2020.
Cash and equivalents: Cash, cash equivalents and marketable securities were $89.5 million as of March 31, 2021. In addition, the Company has availability under its present line of credit with JP Morgan of $64.7 million and an unutilized $100 million credit facility that provides access to incremental capital on a non-dilutive basis.
CONFERENCE CALL & WEBCAST INFORMATION
OPKO’s senior management will provide a business update, discuss first quarter financial results and answer questions during a conference call and live audio webcast beginning at 4:30 p.m. Eastern time today, April 28, 2021. Participants are requested to pre-register for the conference call using the link here, or dialing (888) 869-1189 or (706) 643-5902 and using conference ID 9993698. Upon registering, participants will receive dial-in numbers, an event passcode and a unique registrant ID to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the start of the call.
To access the live call via webcast, please click on the link OPKO 1Q21 Results Conference Call. Individual investors and investment community professionals who do not plan to ask a question during the call’s Q&A session are encouraged to listen to the call via the webcast.
For those unable to listen to the live conference call, a replay can be accessed for a period of time on OPKO’s website at OPKO 1Q21 Results Conference Call. A telephone replay will be available beginning approximately two hours after the completion of the conference call. To access the replay, please dial (855) 859-2056 or (404) 537-3406, and use conference ID 9993698.