On February 21, 2023 PTC Therapeutics, Inc. (NASDAQ: PTCT) reported a corporate update and financial results for the fourth quarter and full year ending December 31, 2022 (Press release, PTC Therapeutics, FEB 21, 2023, View Source [SID1234627452]).
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"2023 will be a very exciting year at PTC, including a celebration of our 25th anniversary," said Stuart W. Peltz, Ph.D., Chief Executive Officer, PTC Therapeutics, Inc. "Together our marketed products grew 30% in revenue in 2022 despite significant foreign exchange headwinds. We expect our revenue growth to accelerate further in 2023, potentially reaching $1 billion in total revenue. We are also advancing a broad and deep pipeline of new therapies that we expect to provide substantial growth in the coming years."
Key Corporate Updates:
2022 total revenue of $699 million, representing 30% year-over-year growth, or $740 million when calculated at CER, representing a 37% growth
2022 revenue for the Duchenne muscular dystrophy (DMD) franchise was $507 million, representing 20% year-over-year growth, or $539 million when calculated at CER, representing a 27% growth. The DMD franchise fourth quarter total net product revenue was $114 million
Translarna (ataluren) total net product revenue was $56 million, with growth coming from new patients in existing geographies and continued geographic expansion
Emflaza (deflazacort) total net product revenue was $58 million, driven by new patient starts, broader access, continued high compliance, and appropriate weight-based dosing
Key Clinical and Regulatory Updates:
PTC continues to make progress in additional ongoing registration-directed clinical studies:
The APHENITY Phase 3 trial of sepiapterin (PTC923) for PKU, with results anticipated in May 2023
The MIT-E Phase 2/3 vatiquinone trial for mitochondrial disease associated seizures, with results anticipated in the second quarter of 2023
The MOVE-FA Phase 3 vatiquinone trial for Friedreich ataxia, with results anticipated in the second quarter of 2023
Enrollment in the PIVOT-HD Phase 2 trial of PTC518 for Huntington’s disease is active and ongoing at study sites in Europe and Australia. Data from the first 12 weeks of the placebo-controlled trial is anticipated in the second quarter of 2023.
Fourth-Quarter and Full-Year 2022 Financial Highlights:
Total revenues were $167.4 million for the fourth quarter of 2022, compared to $165.2 million for the fourth quarter of 2021. Total revenues were $698.8 million for the full year 2022, compared to $538.6 million for the full year 2021.
Total revenue includes net product revenue across the commercial portfolio of $127.5 million for the fourth quarter of 2022 and $535.2 million for the full year 2022, compared to $118.9 million for the fourth quarter of 2021 and $428.9 million for the full year 2021. Total revenue also includes collaboration and royalty revenue of $39.9 million in the fourth quarter of 2022 and $163.6 million for the full year 2022, compared to $46.3 million for the fourth quarter of 2021 and $109.7 million for the full year 2021.
Translarna net product revenues were $55.8 million for the fourth quarter of 2022, compared to $69.7 million for the fourth quarter of 2021. Translarna net product revenues were $288.6 million for the full year 2022, compared to $236.0 million for the full year 2021. These results were driven by treatment of new patients, continued high compliance, and geographic expansion.
Emflaza net product revenues were $58.1 million for the fourth quarter of 2022, compared to $47.5 million for the fourth quarter of 2021. Emflaza net product revenues were $218.3 million for the full year 2022, compared to $187.3 million for the full year 2021. These results reflect new patient prescriptions, high compliance, and fewer discontinuations.
Roche reported Evrysdi 2022 year to date sales of approximately CHF 1,119 million, resulting in full year 2022 royalty revenue of $113.5 million to PTC, as compared to $54.6 million for full year 2021.
Based on U.S. GAAP (Generally Accepted Accounting Principles), GAAP R&D expenses were $188.7 million for the fourth quarter of 2022, compared to $149.8 million for the fourth quarter of 2021. GAAP R&D expenses were $651.5 million for the full year 2022, compared to $540.7 million for the full year 2021. The increase reflects additional investment in research programs and advancement of the clinical pipeline.
Non-GAAP R&D expenses were $174.7 million for the fourth quarter of 2022, excluding $14.0 million in non-cash, stock-based compensation expense, compared to $136.4 million for the fourth quarter of 2021, excluding $13.4 million in non-cash, stock-based compensation expense. Non-GAAP R&D expenses were $595.6 million for the full year 2022, excluding $55.9 million in non-cash, stock-based compensation expense, compared to $487.1 million for the full year 2021, excluding $53.6 million in non-cash, stock-based compensation expense.
GAAP SG&A expenses were $92.7 million for the fourth quarter of 2022, compared to $86.5 million for the fourth quarter of 2021. GAAP SG&A expenses were $326.0 million for the full year 2022, compared to $285.8 million for the full year 2021. The increase reflects our continued investment to support commercial activities, including expanding our commercial portfolio.
Non-GAAP SG&A expenses were $79.3 million for the fourth quarter of 2022, excluding $13.4 million in non-cash, stock-based compensation expense, compared to $73.7 million for the fourth quarter of 2021, excluding $12.8 million in non-cash, stock-based compensation expense. Non-GAAP SG&A expenses were $271.5 million for the full year 2022, excluding $54.5 million in non-cash, stock-based compensation expense, compared to $235.9 million for the full year 2021, excluding $49.9 million in non-cash, stock-based compensation expense.
Intangible asset impairment was $33.4 million for the fourth quarter and full year 2022, which represents a non-cash charge. The partial impairment was related to a decrease in projected cash flows due to refinements in current market assumptions and the timing of patient treatments.
Change in the fair value of deferred and contingent consideration was a loss of $6.3 million for the fourth quarter of 2022, compared to a gain of $12.1 million for the fourth quarter of 2021. Change in the fair value of deferred and contingent consideration was a gain of $25.9 million for the full year 2022, compared to a gain of $0.5 million for the full year 2021. The change in fair value of deferred and contingent consideration is related to the fair valuation of potential future consideration to be paid to former equity holders of Agilis Biotherapeutics, Inc. (Agilis) in connection with PTC’s acquisition of Agilis, which closed in August 2018.
Net loss was $170.9 million for the fourth quarter of 2022, compared to net loss of $143.3 million for the fourth quarter of 2021. Net loss was $559.0 million for the full year 2022, compared to net loss of $523.9 million for the full year 2021.
Cash, cash equivalents, and marketable securities was $410.7 million at December 31, 2022, compared to $773.4 million at December 31, 2021.
Shares issued and outstanding as of December 31, 2022, were 73,104,692.
PTC Reaffirms Full Year 2023 Financial Guidance:
PTC anticipates total revenues for the full year 2023 to be between $940 million and $1.0 billion.
PTC anticipates net product revenues for the DMD franchise for the full year 2023 to be between $545 million and $565 million.
PTC anticipates GAAP R&D and SG&A expense for the full year 2023 to be between $1.01 billion and $1.06 billion.
PTC anticipates Non-GAAP R&D and SG&A expense for the full year 2023 to be between $890 million and $940 million, excluding estimated non-cash, stock-based compensation expense of $120 million. PTC anticipates up to $80 million of one-time payments upon achievement of potential clinical and regulatory success-based milestones from previous acquisitions.
Non-GAAP Financial Measures:
In this press release, the financial results of PTC are provided in accordance with GAAP and using certain non-GAAP financial measures. In particular, the non-GAAP R&D and SG&A expense financial measures exclude non-cash, stock-based compensation expense, and the revenue and percentage changes in revenue growth at CER are presented excluding the impact of changes in foreign currency exchange rates. For financial measures given at CER, the current period’s foreign currency revenue values are converted into U.S. dollars using the average exchange rates from the prior period. These non-GAAP financial measures are provided as a complement to financial measures reported in GAAP because management uses these non-GAAP financial measures when assessing and identifying operational trends. In management’s opinion, these non-GAAP financial measures are useful to investors and other users of PTC’s financial statements by providing greater transparency into the historical and projected operating performance of PTC and the company’s future outlook. Non-GAAP financial measures are not an alternative for financial measures prepared in accordance with GAAP. Quantitative reconciliations of the non-GAAP financial measures to their respective closest equivalent GAAP financial measures are included in the table below.
PTC Therapeutics, Inc.
Consolidated Statements of Operations
(In thousands, except share and per share data)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2022
2021
2022
2021
Revenues:
Net product revenue
$
127,508
$
118,905
$
535,228
$
428,904
Collaboration revenue
28
25,029
50,052
55,046
Royalty revenue
39,876
21,294
113,521
54,643
Total revenues
167,412
165,228
698,801
538,593
Operating expenses:
Cost of product sales, excluding amortization of acquired intangible assets
10,893
9,327
44,678
32,328
Amortization of acquired intangible asset
35,764
16,340
116,554
54,751
Research and development (1)
188,694
149,844
651,496
540,684
Selling, general and administrative (2)
92,718
86,548
325,998
285,773
Intangible asset impairment
33,384
33,384
Change in the fair value of deferred and contingent consideration
6,300
(12,100)
(25,900)
(500)
Total operating expenses
367,753
249,959
1,146,210
913,036
Loss from operations
(200,341)
(84,731)
(447,409)
(374,443)
Interest expense, net
(24,500)
(22,502)
(90,871)
(86,022)
Other income (expense), net
35,147
(31,375)
(49,207)
(57,875)
Loss before income tax expense
(189,694)
(138,608)
(587,487)
(518,340)
Income tax benefit (expense)
18,805
(4,657)
28,470
(5,561)
Net loss attributable to common stockholders
$
(170,889)
$
(143,265)
$
(559,017)
$
(523,901)
Weighted-average shares outstanding:
Basic and diluted (in shares)
72,656,790
70,669,797
71,728,634
70,466,393
Net loss per share—basic and diluted (in dollars per share)
$
(2.35)
$
(2.03)
$
(7.79)
$
(7.43)
(1) Research and development reconciliation
GAAP research and development
$
188,694
$
149,844
$
651,496
$
540,684
Less: share-based compensation expense
13,973
13,416
55,869
53,632
Non-GAAP research and development
$
174,721
$
136,428
$
595,627
$
487,052
(2) Selling, general and administrative reconciliation
GAAP selling, general and administrative
$
92,718
$
86,548
$
325,998
$
285,773
Less: share-based compensation expense
13,370
12,819
54,464
49,881
Non-GAAP selling, general and administrative
$
79,348
$
73,729
$
271,534
$
235,892
PTC Therapeutics, Inc.
Reconciliation of GAAP to Non-GAAP Revenue and Year-Over-Year Revenue Growth at Constant Exchange Rates
(In thousands, except percentages)
December 31, 2022
December 31, 2022
Twelve Months Ended
Twelve Months Ended
GAAP DMD revenue as reported; GAAP year-over-year revenue growth
$
506,846
20 %
Impact of foreign currency translation – DMD net product revenue; year-over year DMD net product revenue growth
32,300
7 %
Non-GAAP DMD revenue at constant exchange rate; Non-GAAP year-over-year revenue growth at constant exchange rate
$
539,146
27 %
December 31, 2022
December 31, 2022
Twelve Months Ended
Twelve Months Ended
GAAP total revenue as reported; GAAP year-over-year
total revenue growth
$
698,801
30 %
Total impact of foreign currency translation – total revenue; year-
over-year total revenue growth
40,800
7 %
Non-GAAP total revenue at constant exchange rate; Non-GAAP
year over-year total revenue growth at constant exchange rate
$
739,601
37 %
PTC Therapeutics, Inc.
Summary Consolidated Balance Sheets
(In thousands, except share data)
December 31, 2022
December 31, 2021
Cash, cash equivalents and marketable securities
$
410,705
$
773,376
Total Assets
$
1,705,619
$
1,938,056
Total debt
$
571,722
$
431,434
Total deferred revenue
1,351
Total liability for sale of future royalties
757,886
733,985
Total liabilities
$
2,052,705
$
1,936,618
Total stockholders’ (deficit) equity (73,104,692 and 70,828,226 common shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively)
$
(347,086)
$
1,438
Total liabilities and stockholders’ (deficit) equity
$
1,705,619
$
1,938,056
PTC Therapeutics, Inc.
Reconciliation of GAAP to Non-GAAP Projected Full Year 2023 R&D and SG&A Expense
(In thousands)
Low End of Range
High End of Range
Projected GAAP R&D and SG&A Expense
$
1,010,000
$
1,060,000
Less: projected non-cash, stock-based compensation expense
120,000
120,000
Projected non-GAAP R&D and SG&A expense
$
890,000
$
940,000
Acronyms:
AADC: Aromatic L-amino acid decarboxylase
ALS: Amyotrophic Lateral Sclerosis
CER: Constant Exchange Rate
DMD: Duchenne Muscular Dystrophy
FDA: U.S. Food and Drug Administration
PKU: Phenylketonuria
R&D: Research and Development
SG&A: Selling, General and Administrative
SMA: Spinal Muscular Atrophy
* Revenue and growth at Constant Exchange Rates, or CER, represents revenue and growth calculated as if the exchange rates had remained unchanged from average exchange rates in 2021. CER is a non-GAAP measure.
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