On May 8, 2023 BioNTech SE (Nasdaq: BNTX, "BioNTech" or the "Company") reported financial results for the three months ended March 31, 2023, and provided an update on its corporate progress (Press release, BioNTech, MAY 8, 2023, View Source [SID1234631131]).
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"In the first quarter of 2023, we expanded our toolkit of cutting-edge technologies to new modalities and added a novel immune checkpoint inhibitor candidate targeting CTLA-4 and two investigational antibody-drug conjugates to our arsenal against cancer. These programs are strategically aligned with our vision to provide meaningful therapeutic benefits for patients with solid tumors along the entire treatment journey," said Prof. Ugur Sahin, M.D., CEO and Co-Founder of BioNTech. "We are taking significant steps in this direction as we prepare to initiate our first Phase 3 clinical trial in oncology for the novel anti-CTLA-4 antibody in NSCLC patients who have progressed after PD-1/PD-L1 treatment, a patient population with high medical need. We are also making progress in advancing our next generation COVID-19 vaccine candidate while we stand prepared for variant adaptation in case of public health need. For the remainder of 2023, we are focused on advancing our disruptive platforms against solid tumors and accelerating clinical programs in infectious diseases of high global need."
Financial Review for the First Quarter 2023
in millions €, except per share data First Quarter 2023 First Quarter 2022
Total Revenues2 1,277.0 6,374.6
Net Profit 502.2 3,698.8
Diluted Earnings per Share 2.05 14.24
Total revenues reported were €1,277.0 million2 for the three months ended March 31, 2023, compared to €6,374.6 million2 for the comparative prior year period. The change was mainly due to lower commercial revenues from the supply and sales of the Company’s COVID-19 vaccines worldwide.
Cost of sales were €96.0 million for the three months ended March 31, 2023, compared to €1,294.1 million for the comparative prior year period. The change was mainly due to decreasing sales from BioNTech’s COVID-19 vaccine revenues.
Research and development expenses were €334.0 million for the three months ended March 31, 2023, compared to €285.8 million for the comparative prior year period. The change was mainly due to higher expenses incurred from progressing the clinical studies for pipeline candidates. The increase was further driven by an increased headcount.
General and administrative expenses were €119.4 million for the three months ended March 31, 2023, compared to €90.8 million for the comparative prior year period. The change was mainly due to increased expenses for IT, purchased external services, as well as an increase in headcount.
Income taxes were accrued in an amount of €205.5 million of tax expenses for the three months ended March 31, 2023, compared to €1,319.3 million of tax expenses for the comparative prior year period. The derived annual effective income tax rate for the three months ended March 31, 2023, was 29.0% which is expected to decrease over the 2023 financial year to be in line with BioNTech’s guidance.
Net profit was €502.2 million for the three months ended March 31, 2023, compared to €3,698.8 million for the comparative prior year period.
Cash and cash equivalents as well as security investments were €12,143.9 million and €671.9 million, respectively, as of March 31, 2023. Subsequent to the end of the reporting period, the payment settling BioNTech’s gross profit share for the fourth quarter of 2022 (as defined by the contract with Pfizer, Inc. ("Pfizer")) in the amount of €3,961.3 million was received from our collaboration partner as of April 14, 2023. The contractual settlement of the gross profit share under the COVID-19 vaccine program collaboration with Pfizer has a temporal offset of more than one calendar quarter. As Pfizer’s fiscal quarter for subsidiaries outside the United States differs from BioNTech’s financial reporting cycle, it creates an additional time lag between the recognition of revenues and the payment receipt.
Shares outstanding as of March 31, 2023 were 240,990,499.
Cash outflows and share consideration in connection with the planned acquisition of InstaDeep Ltd. ("InstaDeep") and the upfront payments of the collaboration and license agreements with OncoC4, Inc. ("OncoC4") and Duality Biologics (Suzhou) Co. Ltd. ("DualityBio") of approximately €0.8 billion are expected (subject to change and excluding future potential earn-out and milestone payments).
"In the first quarter of 2023, our financial performance has been fully in line with our expectations and we executed according to our capital allocation priorities by growing and advancing our clinical-stage pipeline, announcing multiple significant business development transactions and continuing to pursue our share repurchase program," said Jens Holstein, CFO of BioNTech. "For the remainder of 2023, we remain focused on fulfilling our goals and continuing to provide value to our patients and shareholders."
Outlook for the 2023 Financial Year
The Company reiterates its prior financial year outlook:
BioNTech COVID-19 Vaccine Revenues for the 2023 Financial Year:
Estimated BioNTech COVID-19 vaccine revenues for the full 2023 financial year ~ €5 billion
This revenue estimate reflects expected revenues related to BioNTech’s share of gross profit from COVID-19 vaccine sales in the collaboration partners’ territories, from direct COVID-19 vaccine sales to customers in BioNTech’s territory and expected revenues generated from products manufactured by BioNTech and sold to collaboration partners, which may be influenced by costs such as inventory write-offs once materialized and shared with the collaboration partner Pfizer.
Revenue guidance is based on various assumptions, including, but not limited to, the expected transition from an advanced purchase agreement environment to commercial market ordering starting in some geographies and an expected regulatory recommendation to adapt the COVID-19 vaccines to address newly circulating variants or sublineages of SARS-CoV-2. The estimated BioNTech COVID-19 vaccine revenues reflect expected deliveries under existing or committed supply contracts and anticipated sales through traditional commercial orders. A re-negotiation of the existing supply contract with the European Commission is ongoing, with the potential for a rephasing of deliveries of doses across multiple years and/or a volume reduction. While a vaccine adaptation is expected to lead to increased demand, fewer primary vaccinations and lowered population-wide levels of boosting are anticipated. Seasonal demand is assumed, moving expected revenue generation significantly to the second half of the year 2023.
Planned 2023 Financial Year Expenses and Capex4:
R&D expenses5 €2,400 million – €2,600 million
SG&A expenses €650 million – €750 million
Capital expenditures for operating activities6 €500 million – €600 million
Estimated 2023 Financial Year Tax Assumptions:
BioNTech Group estimated annual cash effective income tax rate ~ 27%
Operational Review and Pipeline Update for the First Quarter 2023 and Key Post Period-End Events
Oncology Pipeline
BNT316 (ONC-392) is an anti-CTLA-4 monoclonal antibody candidate being developed in collaboration with OncoC4. BNT316 (ONC-392) offers a potentially differentiated safety profile that may allow for higher dosing and longer duration of treatment both as a monotherapy and in combination with other therapies.
BioNTech and OncoC4 plan to start a Phase 3 clinical trial to evaluate BNT316 (ONC-392) as monotherapy in non-small cell lung cancer (NSCLC) patients who progress on anti-PD-1/PD-L1 antibody-based therapy in 2023.
BioNTech and OncoC4 plan to present data from an expansion cohort evaluating BNT316 (ONC-392) as monotherapy in NSCLC patients as part of the ongoing Phase 1/2 clinical trial at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting held in Chicago, USA, from June 2-6, 2023.
BNT323 (DB-1303) is a HER2-targeted antibody-drug conjugate (ADC) candidate, being developed in collaboration with DualityBio.
BNT323 (DB-1303) is currently being evaluated in a Phase 1/2 clinical trial in patients with advanced/unresectable, recurrent, or metastatic HER2-expressing solid tumors. BioNTech and DualityBio expect a data update from the ongoing trial at the 2023 ASCO (Free ASCO Whitepaper) Annual Meeting.
In January, BNT323 (DB-1303) received Fast Track designation from the U.S. Food and Drug Administration for the treatment of patients with HER2-overexpressing advanced, recurrent, or metastatic endometrial carcinoma who have progressed on or after standard systemic treatment.
Autogene cevumeran (BNT122) is an mRNA cancer vaccine candidate based on an individualized neoantigen-specific immunotherapy (iNeST) approach being developed in collaboration with Genentech, a member of the Roche Group.
A Phase 2 clinical trial of BNT122 in the adjuvant setting in patients with pancreatic ductal adenocarcinoma (PDAC) is planned to open in 2023.
BNT211 is an autologous CLDN6-targeting chimeric antigen receptor (CAR) T cell therapy that is being tested alone and in combination with a CAR-T cell Amplifying RNA Vaccine, or CARVac, encoding CLDN6.
BioNTech expects a data update from the ongoing Phase 1/2 dose escalation and expansion clinical trial, in patients with CLDN6-positive relapsed or refractory advanced solid tumors at the 2023 ASCO (Free ASCO Whitepaper) Annual Meeting.
Infectious Diseases Pipeline
Next-generation COVID-19 Vaccine Program BNT162b2 + BNT162b4
In April, BioNTech reported preclinical data on BNT162b4, the vaccine component encoding conserved non-spike antigen derived T cell epitopes, alone and in combination with BNT162b2, encoding the full spike protein. In the preclinical study, the candidate protected from severe COVID-19 disease and enhanced viral clearance. The findings are in press in the peer-reviewed journal Cell (Arieta C. et al. The T-cell-directed vaccine BNT162b4 encoding conserved non-spike antigens protects animals from severe SARS-CoV-2 infection, Cell (2023), doi: View Source).
A Phase 1 clinical trial to evaluate the safety, tolerability, and immunogenicity of BNT162b4 in combination with BNT162b2 is ongoing.
Tuberculosis Vaccine Program – BNT164
In April, BioNTech initiated a randomized, controlled, dose-finding Phase 1 clinical trial of BNT164 in partnership with the Bill and Melinda Gates Foundation. The clinical trial will evaluate the safety, reactogenicity, and immunogenicity of mRNA vaccine candidates against Tuberculosis.
Shingles Vaccine Program – BNT167
In February, BioNTech and Pfizer initiated a multicenter, randomized, controlled, dose-selection Phase 1/2 clinical trial of BNT167, the companies’ mRNA vaccine candidate against shingles (also known as herpes zoster). The clinical trial will evaluate the safety, tolerability, and immunogenicity of mRNA vaccine candidates against shingles.
Corporate Update for the First Quarter 2023 and Key Post Period-End Events
In January, BioNTech entered into an agreement to acquire its long-standing strategic collaboration partner InstaDeep, enabling the creation of a fully integrated, enterprise-wide capability that leverages artificial intelligence and machine learning technologies across BioNTech’s therapeutic platforms and operations. The transaction is subject to customary closing conditions and regulatory approvals.
In January, BioNTech signed a Memorandum of Understanding with the Government of the United Kingdom to establish a multi-year collaboration focused on three strategic pillars: cancer immunotherapies based on mRNA or other drug classes, infectious disease vaccines, and investments into expanding BioNTech’s footprint in the UK as one of the Company’s key markets. The goal of the collaboration is to provide personalized cancer therapies for up to 10,000 patients by the end of 2030, either in clinical trials or as authorized treatments.
In February, BioNTech completed construction of the Company’s first proprietary plasmid DNA manufacturing facility. The plasmid DNA produced at this state-of-the-art facility in Marburg, Germany is planned to be used globally and serve as the basis for the manufacturing of mRNA- and cell-based products on a clinical or commercial scale.
In March, BioNTech announced the establishment of an interdisciplinary mRNA Excellence Center to conduct research jointly with scientists from Weizmann Institute of Science in Israel. The Company’s mRNA Excellence Center is expected to provide space for approximately 60 researchers to facilitate collaboration across various fields, including life science, computer science, mathematics, physics, and chemistry.
In March, BioNTech provided an update on its plans to establish scalable mRNA vaccine production in Africa. The Company announced that six ISO-sized shipping containers for the first BioNTainer, a turnkey manufacturing solution designed to enable scalable mRNA vaccine production in bulk, arrived in Kigali, Rwanda.
In March, BioNTech entered into an exclusive worldwide licensing and collaboration agreement with OncoC4 to co-develop and commercialize BNT316 (ONC-392), an anti-CTLA-4 monoclonal antibody candidate as monotherapy or combination therapy in various cancer indications.
In March, BioNTech entered into a new share repurchase program pursuant to which the Company may purchase American Depositary Shares, each representing one ordinary share of the Company, in the amount of up to $0.5 billion during the remainder of 2023.
In April, BioNTech entered into exclusive license and collaboration agreements with DualityBio to develop, manufacture and commercialize two investigational topoisomerase-1 inhibitor-based ADC assets, BNT323 (DB-1303) and BNT324 (DB-1311).
Environmental, Social, and Governance (ESG)
BioNTech recognizes its responsibility as a corporate citizen and is committed to supporting its local communities and beyond through donations, sponsorships and volunteer activities. In response to the earthquakes that hit Türkiye and Syria in February, BioNTech contributed to the humanitarian aid in both countries by donating €500,000 to the nonprofit organization ‘Aktionsbündnis Katastrophenhilfe’ (Action Alliance for Disaster Relief). For humanitarian aid in Ukraine, the Company donated €500,000 to the refugee relief ‘UNO-Flüchtlingshilfe’ – the partner of UN Refugee Agency (UNHCR) in Germany.
On March 27, 2023, BioNTech published its third ESG report (Sustainability Report 2022). The report is available in the Investor Relations section of BioNTech’s website.
Upcoming Investor and Analyst Events
The Annual General Meeting is scheduled for May 25, 2023.
BioNTech plans to host an Innovation Series Day on November 7, 2023.
Endnotes
The full interim unaudited condensed consolidated financial statements can be found in BioNTech’s Report on Form 6-K, filed today with the SEC and available at View Source
1 Financial information is prepared and presented in Euros and numbers are rounded to millions and billions of Euros in accordance with standard commercial practice.
2 BioNTech’s profit share is estimated based on preliminary data shared between Pfizer and BioNTech as further described in the Annual Report. Any changes in the estimated share of the collaboration partner’s gross profit will be recognized prospectively.
3 Calculated applying the average foreign exchange rate for the three months ended March 31, 2023, as published by the German Central Bank (Deutsche Bundesbank).
4 Numbers reflect current base case projections and are calculated based on constant currency rates.
5 Numbers include effects identified from additional collaborations or potential M&A transactions to the extent disclosed and will be updated as needed.
6 Numbers exclude potential effects caused by or driven from collaborations or M&A transactions.
Conference Call and Webcast Information
BioNTech invites investors and the general public to join a conference call and webcast with investment analysts today, May 8, 2023 at 8.00 a.m. EDT (2.00 p.m. CEST) to report its financial results and provide a corporate update for the first quarter of 2023.