On January 17, 2023 18 January 2023. Telix Pharmaceuticals Limited (ASX: TLX, Telix, the Company) today reported its Appendix 4C quarterly cash flow statement and accompanying Activities Report for the quarter ended 31 December 2022 (Q4 2022) (Press release, Telix Pharmaceuticals, JAN 17, 2023, View Source [SID1234626308]). All figures are in AUD$ unless otherwise stated1 and provided on an unaudited basis.
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Financial Summary
Telix achieved positive cash flow from operating activities: net operating cash flow improved by $6.9 million over the prior quarter to a $1.6 million inflow for the quarter
Cash receipts from customers were $72.2 million, up 62% from $44.5 million in the prior quarter
Telix reports Q4 2022 revenue of $78.2 million from global sales of Illuccix, up 41% on the prior quarter ($55.3 million, Q3 2022)
Revenue from sales of Illuccix in the United States up 43% to $76.8 million on the prior quarter (39% on a US dollar basis)
Commercial Activity Report
U.S. commercial update
In Q4 2022, the third quarter of commercial sales, Telix generated $76.8 million (US$50.5 million) revenue from sales of its prostate cancer positron emission tomography (PET) imaging agent, Illuccix. This represents a 43% increase on the prior quarter ($53.7 million, Q3 2022). Sales momentum continues to build, due to active reimbursement and growth across three major segments of hospital customers, independent imaging centres and government (Veterans Affairs) customers.
The Company’s distribution network now consists of 190 nuclear pharmacies nationwide, facilitating industry-leading on-time delivery and scheduling flexibility.
Kevin Richardson, CEO Telix Americas said, "We are pleased to see continued sales momentum nine months after launching in the United States and Puerto Rico. We are continuously adding new sites and growing existing accounts, resulting in a steady increase in demand for doses. In 2023, we look forward to building on the foundations of a successful commercial launch to continue to drive sustainable growth and make a positive impact on more patients’ lives."
Prostate imaging worldwide revenue
Total revenue of $78.2 million was generated from prostate imaging sales (including commercial sales of Illuccix in the U.S.) during the quarter. Of this, $1.4 million was generated from rest of world sales, predominantly being pre-commercial sales2 in Europe and the United Kingdom.
Net cash from operating activities
Telix reports its maiden quarter of net operating cash inflow, being a significant milestone for the business. The $1.6 million inflow for the quarter is a $6.9 million improvement on the prior quarter’s net operating cash outflow of $5.3 million and is largely representative of further growth in commercial sales, a continued focus on operating expenditure control and management of customer receivables.
1. Conversion to AUD is at the average exchange rate for the period. AUD$1 = US$0.66; AUD$1 = €0.64
2. Pre-commercial sales are from investigational, clinical trial, magisterial and compassionate use in accordance with local laws and regulations (not as a commercial diagnostic imaging product sold for routine clinical practice).
Cash receipts from customers improved 62% to $72.2 million, from $44.5 million in the prior quarter.
Payments for product manufacturing and related costs reflect higher volume of sales and timing of supplier payments, with a gross margin achieved of 63%, up 2% on the prior quarter of worldwide sales.
Operating and selling, general and administration costs were lower by $4.7 million compared to the prior quarter, reflecting improved working capital management.
Reasearch and development (R&D) costs remain well controlled, with $19.2 million invested in R&D, manufacturing and clinical development activities, a $2.9 million increase over the prior quarter.
Illuccix global regulatory update
During the quarter, Health Canada approved Illuccix for use with PET of prostate specific membrane antigen (PSMA) positive lesions in men with prostate cancer:
1. with suspected metastasis who are suitable for initial definitive therapy; and
2. with suspected recurrence with elevated serum prostate specific antigen (PSA) level.
Telix is preparing for commercial launch in Canada in H1 2023 through its partner, Isologic Innovative Radiopharmaceuticals, whose distribution network services 265 hospitals and clinics nationwide.
Telix is making progress on the regulatory refiling in Europe and is targeting to have the updated dossier finalised by the end of Q1 2023, for resubmission to the Danish Medicines Agency (DKMA). The DKMA will advise the revised review timeline upon formal acceptance of the updated dossier. Telix is also progressing marketing authorisation applications in Brazil and South Korea together with its partners.
Clinical Programs Update
Telix continues to progress its core clinical pipeline, with a focus on prostate cancer, renal (kidney) cancer, brain cancer (glioblastoma) and rare diseases (bone marrow conditioning). The Company has over 20 clinical trials underway, including collaborative investigator-initiated studies. Notable updates are included in this section of the activities report.
Renal (kidney) cancer / carbonic anhydrase IX (CAIX) program
The Company reported highly positive top-line data from the ZIRCON (NCT03849118) Phase III study of TLX250-CDx (89Zr-DFO-girentuximab), an investigational product for the PET imaging of clear cell renal cell carcinoma (ccRCC).1
The study met all of its primary and secondary endpoints:
Co-primary endpoints of 86% sensitivity and 87% specificity were delivered, considerably exceeding the confirmatory trial success target required to demonstrate the ability of TLX250-CDx to reliably detect the clear cell phenotype and provide a non-invasive method of diagnosing the presence and spread of ccRCC.
The key secondary endpoint in detecting ccRCC in tumours <4cm ("T1a" classification), was also delivered, with 85% sensitivity and 89% specificity achieved.
These results mean that, for the first time, there may be a non-invasive way to characterise and diagnose ccRCC, the most aggressive and common form of renal malignancy, which if approved would deliver on a major unmet medical need.
Detailed results from the ZIRCON study will be presented for the first time at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Genitourinary (GU) Cancers Symposium (ASCO GU) on 18 February 2023 in an oral presentation format.2
Dr Colin Hayward, Chief Medical Officer at Telix said: "The excellent results from the ZIRCON study validate that the CAIX target is potentially as ground-breaking in ccRCC as PSMA has been for prostate cancer, and that TLX250-CDx could change the standard of care in the diagnosis and management of renal masses. We are excited to present further clinical data at ASCO (Free ASCO Whitepaper)-GU next month, the leading specialised event for genitourinary cancer care worldwide, and to advance towards the preparation of a Biologics License Application for submission to the FDA."
1. ASX disclosure 7 November 2022.
2. ASX disclosure 22 December 2022.
TLX250-CDx potential for indication expansion
Beyond ccRCC, CAIX is also expressed by a number of other solid tumours including bladder or urothelial, breast, brain, cervix, colon, oesophagus, head and neck, lung, ovarian, pancreatic and vulval cancers. It is often expressed in hypoxic (oxygenated) tumour cells, characteristic of advanced disease with typically poor treatment outcomes. Hypoxic tumours are typically more aggressive and less responsive to current treatments, particularly immunotherapies.1
Based on this potential to target multiple tumour types, investigator-led studies are in progress using TLX250-CDx in imaging of urothelial carcinoma or bladder cancer (ZiP-UP, NCT05046665), metastatic triple negative breast cancer (OPALESCENCE, NCT04758780), and non-muscle invasive bladder cancer (PERTINENCE, NCT04897763), and as proof- of-concept for stand-alone and combination therapies. OPALESENCE and PERTINENCE studies reported positive preliminary data during the quarter at the European Association of Nuclear Medicine (EANM) Annual Congress.2
Also during the quarter, Telix announced STARBURST (NCT05563272), a prospective, open-label, Phase II study to explore CAIX expression through TLX250-CDx PET/CT imaging in patients with various solid tumours for diagnostic and therapeutic applications.3 An investigational new drug application (IND) has been submitted to the FDA with first patients expected to be enrolled in the study during Q1 2023.
Prostate cancer / PSMA therapy program
Telix’s PSMA-targeting ProstACT therapeutic program is evaluating the efficacy of Telix’s lutetium-177 (177Lu)-labelled therapeutic antibody (TLX591) in various stages of prostate cancer, from first recurrence to advanced metastatic disease.4
The ProstACT SELECT study (NCT04786847), a "theranostic" (imaging and therapy) Phase I radiogenomics study to demonstrate the utility of Illuccix to select TLX591 patients for therapy, continues to recruit well with top-line data expected in H1 2023. During the quarter, a first patient was dosed in the Phase II ProstACT TARGET study of TLX591 (NCT05146973), in patients experiencing a first recurrence of prostate-specific antigen (PSA) after initial therapy for prostate cancer.5
The Company is progressing manufacturing scale up and regulatory submissions for the ProstACT GLOBAL Phase III study (NCT04876651) in preparation to commence dosing patients in Australia and New Zealand, the U.S. and Europe, subject to the requisite regulatory approvals. The study will be a global randomised controlled trial in patients progressing on novel hormonal therapy in the metastatic setting. Patients will be randomised 2:1 to TLX591 with a total of ~392 patients expected to be enrolled. An interim analysis for safety and efficacy is planned at approximately 120 patients.
Glioblastoma (brain cancer) / LAT-1 program
During the quarter, a first patient was dosed in IPAX-Linz (IPAX-L), a Phase II investigator-initiated study of TLX101 in combination with external beam radiation therapy (EBRT) in patients with recurrent high-grade gliomas (HGG), including glioblastoma multiforme (GBM).6 TLX101 (4-L-[131I] iodo-phenylalanine, or 131I-IPA) is one of Telix’s lead therapeutic clinical programs and has been granted orphan drug designation in the U.S. and Europe. TLX101 targets L-type amino acid transporter 1 (LAT-1), typically over-expressed in many malignant tumours, including HGG/GBM.
The IPAX-Linz study, led by Professor Josef Pichler at Kepler University Hospital in Linz, Austria, builds on encouraging safety and preliminary efficacy data generated in the IPAX-1 study.7 IPAX-Linz will continue to study the benefit of TLX101 to patients in the second line (refractory) setting at this leading neuro-oncology site in Europe. The goal of this study is to gather additional data on clinical utility.
IPAX-Linz will run concurrently with IPAX-2 (NCT05450744), which is evaluating TLX101 in combination with post-surgical standard of care comprised of EBRT and temozolomide in newly diagnosed (first line) GBM patients. It is expected that the combination of the IPAX-1, IPAX-2 and IPAX-L studies will inform a pivotal trial strategy for this asset by end-2023.
1. Huizing, F.J. et al. Sci Rep 9 2019.
2. ASX disclosure 18 October 2022.
3. ASX disclosure 7 November 2022.
4. ASX disclosure 27 January 2022.
5. ASX disclosure 12 April 2022.
6. Telix media release 22 November 2022.
7. ASX disclosure 21 September 2022.
Research, Innovation and Manufacturing
In November 2022, Telix entered into a collaboration with UniQuest Pty Ltd (UniQuest), the commercialisation company of The University of Queensland (UQ), to develop a radiolabelled molecule targeting an immune checkpoint protein.1 The goal is that an immune targeting peptide could be used as an imaging agent to determine the presence of certain immune checkpoint proteins in metastatic tumours, in order to guide patient selection for immunotherapy.
The Company also announced its acquisition of Optimal Tracers, a Sacramento (California)-based radiochemistry development company, that provides radiochemistry process development services and research tracers for use in clinical trials.2 The acquisition of Optimal Tracers expands Telix’s translational radiochemistry capability and offers a unique environment for pharma partnerships and collaborations.
In December 2022, Telix published that it has been granted an updated radiation licence by the Belgian Federal Agency for Nuclear Control (FANC) for its European radiopharmaceutical production facility in Brussels South.3 This licence paves the way for the Company to activate the site for production H2 2023 subject to the requisite regulatory inspections and approvals.
Executive Leadership Changes
Also in December 2022, Telix announced several key executive leadership appointments and promotions.
Richard Valeix, Chief Executive Officer for the Europe, Middle East and Africa (EMEA) operating region since joining Telix in May 2021, was appointed to the newly created role of Group Chief Commercial Officer.
Raphael Ortiz, Chief Operating Officer – EMEA since joining in January 2022, succeeds Richard as Chief Executive Officer – EMEA.
Genevieve Ryan also joined the Company as Group Company Secretary, replacing Melanie Farris who has retired from the role to take on a broader portfolio as Senior Vice President Global Governance, Risk and Compliance (GRC).
These appointments reflect an increased commercial focus of the Company and ongoing succession planning to ensure Telix has an optimal mix of skills and experience as the Company prepares to enter a new phase with a portfolio of multiple commercial products.
Payments to Related Parties
Telix confirms that payments noted under section 6.1 of the accompanying Appendix 4C include payments of $1.3 million to ABX-CRO advanced pharmaceutical services (of which Non-Executive Director Dr. Andreas Kluge is Managing Director) for the provision of clinical and analytical services for the Company’s development programs. Payments of $0.2 million to Directors were for Director fees and Managing Director salary.
Investor Call
An investor conference call and webcast was held at 9.00am on Wednesday 18 January AEDT (5.00pm, Tuesday 17 January, EST).