On February 6, 2023 Neurocrine Biosciences, Inc. (Nasdaq: NBIX) reported its financial results for the fourth quarter and fiscal year ended December 31, 2022 and provided financial guidance for 2023 (Press release, Neurocrine Biosciences, FEB 6, 2023, View Source [SID1234626882]).
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"We enter this year with tremendous momentum aiming to help the 7 out of 10 patients living with tardive dyskinesia in the U.S. who have not received a proper diagnosis for their uncontrollable movement disorder," said Kevin Gorman, Ph.D., Chief Executive Officer of Neurocrine Biosciences. "Our capital allocation priorities remain: Invest in INGREZZA and in our pipeline. Enrollment is now complete in both the adult and pediatric registrational studies of crinecerfont for the treatment of congenital adrenal hyperplasia and we look forward to sharing the top-line data this year. With INGREZZA growing and our pipeline advancing, the fundamentals of our business are strong as we advance on our mission to be a leading neuroscience company."
Three Months Ended
December 31,
Twelve Months Ended
December 31,
(unaudited, in millions, except per share data)
2022
2021
2022
2021
Revenues:
Product sales, net
$ 404.6
$ 303.5
$ 1,440.9
$ 1,090.1
Collaboration revenue
7.4
8.5
47.8
43.4
Total revenues
$ 412.0
$ 312.0
$ 1,488.7
$ 1,133.5
GAAP Research and Development (R&D)
$ 118.0
$ 87.4
$ 463.8
$ 328.1
Non-GAAP R&D
$ 103.9
$ 75.2
$ 406.1
$ 279.7
GAAP Selling, General and Administrative (SG&A)
$ 182.9
$ 156.5
$ 752.7
$ 583.3
Non-GAAP SG&A
$ 151.8
$ 133.1
$ 635.6
$ 497.5
GAAP net income (loss)
$ 89.0
$ (7.3)
$ 154.5
$ 89.6
GAAP earnings (loss) per share – diluted
$ 0.88
$ (0.08)
$ 1.56
$ 0.92
Non-GAAP net income
$ 124.7
$ 4.3
$ 343.2
$ 185.8
Non-GAAP earnings per share – diluted
$ 1.24
$ 0.04
$ 3.47
$ 1.90
(unaudited, in millions)
December 31,
2022
December 31,
2021
Total cash, cash equivalents and marketable securities
$ 1,288.7
$ 1,272.0
Fourth Quarter and Fiscal 2022 INGREZZA Net Product Sales and Commercial Highlights:
INGREZZA fourth quarter and fiscal 2022 net product sales were $399 million and $1.43 billion, respectively
INGREZZA fourth quarter net product sales and total prescriptions grew 33% and 29%, respectively, vs. fourth quarter of 2021
Sequential growth driven by record new patients and continued strength in existing patients’ refill rates
Fourth Quarter Financial Highlights:
Fourth quarter 2022 GAAP net income and diluted earnings per share of $89 million and $0.88, respectively, compared with GAAP net loss and earnings per share of $7 million and $0.08, respectively, for fourth quarter 2021.
Fourth quarter 2022 non-GAAP net income and diluted earnings per share of $125 million and $1.24, respectively, compared with $4 million and $0.04, respectively, for fourth quarter 2021.
Differences in fourth quarter 2022 GAAP and non-GAAP operating expenses compared with fourth quarter 2021 driven by:
In-Process Research and Development (IPR&D) in fourth quarter 2021 associated with a $100 million upfront fee paid to Sosei Heptares pursuant to our exclusive license agreement
Increased R&D expense in support of an expanded and advancing clinical portfolio
Increased SG&A expense primarily due to ongoing commercial initiatives, including the deployment of the expanded salesforce in April 2022
At December 31, 2022, the Company had cash, cash equivalents and marketable securities of approximately $1.3 billion.
A reconciliation of GAAP to non-GAAP financial results can be found in Table 3 and Table 4 at the end of this earnings release.
Recent Events:
On November 1, 2022, we acquired Diurnal Group plc in an all-cash transaction, for an aggregate value of approximately $55 million. We believe the transaction presents an opportunity to accelerate the establishment of our clinical development and commercial capabilities in the United Kingdom to the benefit of patient communities and other stakeholders.
On December 22, 2022, we announced that the U.S. Food and Drug Administration accepted the supplemental New Drug Application for valbenazine as a treatment for chorea associated with Huntington Disease. The agency set a Prescription Drug User Fee Act target action date of August 20, 2023.
On January 8, 2023, we entered into a new strategic collaboration with Voyager Therapeutics, Inc., or Voyager, to acquire the worldwide rights to Voyager’s GBA1 gene therapy program for Parkinson’s disease and other GBA1-mediated diseases and three gene therapy programs directed to rare central nervous system targets. This transaction is anticipated to close in the first quarter subject to certain conditions including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and other customary closing conditions.
On February 6, 2023, we announced enrollment is complete in both the Adult and Pediatric Registrational Studies of crinecerfont for Congenital Adrenal Hyperplasia. We anticipate top-line data for both studies to read-out in the second half of 2023.
Fiscal 2023 INGREZZA Sales and Operating Expense Guidance:
Range
(in millions)
Low
High
INGREZZA (Tardive Dyskinesia Only) Net Product Sales 1
$ 1,670
$ 1,770
GAAP R&D expense 2
$ 550
$ 580
Non-GAAP R&D expense 3
$ 495
$ 525
GAAP SG&A expense
$ 850
$ 870
Non-GAAP SG&A expense 3
$ 730
$ 750
INGREZZA sales guidance for fiscal 2023 reflects expected sales of INGREZZA in tardive dyskinesia only. The guidance range is based upon recent trends and underlying business initiatives underway to help advance the development of the tardive dyskinesia market.
GAAP R&D guidance reflects the progression of the Company’s pipeline including 12 mid-to-late-stage clinical studies, meaningful investments in the muscarinic portfolio and expanded pre-clinical research efforts. GAAP R&D guidance includes (i) amounts for milestones that are probable of achievement or have been achieved and (ii) amounts for in-process research and development once significant collaboration and licensing arrangements have been completed.
GAAP SG&A guidance reflects the continued investment in the expanded commercial organization to support INGREZZA as well as the Company’s direct-to-consumer advertising campaign. In addition, guidance includes an investment to support the anticipated approval for valbenazine to treat patients with chorea associated with Huntington disease. Non-GAAP guidance adjusted to exclude estimated non-cash stock-based compensation expense of $55 million in R&D and $120 million in SG&A.
2023 Expected Pipeline Milestones and Key Activities
Program
Indication
2023 Milestones / Key Activities
Valbenazine*
(Selective VMAT2 Inhibitor)
Chorea in Huntington Disease
PDUFA Aug. 20, 2023
Crinecerfont
(CRF1 Receptor Antagonist)
Congenital Adrenal Hyperplasia (Adult)
Top-Line Registrational Data in Second Half of 2023
Congenital Adrenal Hyperplasia (Pediatric)
Top-Line Registrational Data in Second Half of 2023
NBI-921352**
(Selective NaV1.6 Channel Blocker)
Focal Onset Seizure in Adults
Top-Line Phase 2 Data in Second Half of 2023
NBI-1065846†
(GPR-139 Agonist)
Anhedonia in Major Depressive Disorder
Top-Line Phase 2 Data in Second Half of 2023
NBI-1117570‡
(Dual M1/ M4 Agonist)
Treatment of Schizophrenia
Initiate Phase 1 Study
New Chemical Entity
or Entities
Indication(s) TBD
Initiate at Least One Phase 1 Study
Key: VMAT2 = Vesicular Monoamine Transporter 2; CFR1 = Corticotropin-Releasing Factor Type 1; NaV1.6 = Sodium Channel, Voltage-Gated; M1 / M4 = M1 / M4 Muscarinic Receptor; GPR = Orphan G Protein Coupled Receptor
Neurocrine Biosciences Partners: * Mitsubishi Tanabe Pharma Corporation has commercialization rights in East Asia; ** In-Licensed from Xenon Pharmaceuticals; † Partnered with Takeda Pharmaceutical Company Limited; ‡ In-Licensed from Sosei Group Corporation
Conference Call and Webcast Today at 8:00 AM Eastern Time
Neurocrine Biosciences will hold a live conference call and webcast today at 8:00 a.m. Eastern Time (5:00 a.m. Pacific Time). Participants can access the live conference call by dialing 866-952-8559 (US) or 785-424-1743 (International) using the conference ID: NBIX. The webcast can also be accessed on Neurocrine Biosciences’ website under Investors at www.neurocrine.com. A replay of the webcast will be available on the website approximately one hour after the conclusion of the event and will be archived for approximately one month.