On February 29, 2024 Sana Biotechnology, Inc. (NASDAQ: SANA), a company focused on creating and delivering engineered cells as medicines, reported financial results and business highlights for the fourth quarter and year ended December 31, 2023 (Press release, Sana Biotechnology, FEB 29, 2024, View Source [SID1234640663]).

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"2023 was an important year for the company, setting a strong foundation in three therapeutic areas with significant unmet needs – blood cancers, B-cell mediated autoimmune diseases, and type 1 diabetes. With the ongoing trials in these areas – ARDENT, GLEAM, VIVID, and the primary islet cell investigator-sponsored trial – we expect to treat 40-60 patients across multiple indications in 2024 and report data from each study," said Steve Harr, Sana’s President and Chief Executive Officer. "By year-end 2024, our goal is to demonstrate that we are able to transplant allogeneic cells in patients in multiple settings without immune detection or rejection, delivering potentially transformative therapies across multiple therapeutic areas. With the recent financing, we were able to strengthen the balance sheet, allowing us to continue to invest appropriately in moving our clinical pipeline forward."

Recent Corporate Highlights

Advancing four clinical programs across seven indications, including an allogeneic CAR T program targeting CD19+ cancers, an allogeneic CAR T program for B-cell mediated autoimmune diseases, an allogeneic CAR T program targeting CD22+ cancers, and a primary islet cell therapy in type 1 diabetes:

SC291 is a hypoimmune (HIP)-modified CD19-directed allogeneic CAR T for patients with B-cell malignancies and B-cell mediated autoimmune diseases.

The ARDENT trial evaluates SC291 in patients with B-cell malignancies. Early SC291 data from the ongoing ARDENT trial suggest the ability to dose safely, the desired immune evasion profile, and early clinical efficacy. Enrollment in this dose escalation study continues, and Sana expects to share more data in 2024.
The GLEAM trial evaluates SC291 in patients with B-cell mediated autoimmune diseases including lupus nephritis, extrarenal lupus, and antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis. The Investigational New Drug Application (IND) cleared in 4Q 2023, and Sana expects to share initial data in 2024.
The VIVID trial evaluates SC262, a HIP-modified CD22-directed allogeneic CAR T, in patients with relapsed or refractory B-cell malignancies. The VIVID trial initially investigates SC262 in patients who have received prior CD19-directed CAR T therapy. The IND cleared in early 2024, and Sana expects to share initial data in 2024.
UP421 is a primary human HIP-modified islet cell therapy for patients with type 1 diabetes. The goal of this investigator-sponsored trial is to understand islet cell survival and immune evasion without immunosuppression in patients with autoimmunity, along with function as measured by C-peptide production. The Clinical Trial Application (CTA) cleared in 4Q 2023, and Sana expects initial data to be shared in the first half of 2024.
Published preclinical data in Cell Stem Cell demonstrating that HIP-modified islet cells provided lasting endocrine function in a fully immunocompetent non-human primate, enabling the achievement of exogenous insulin independence without immunosuppression for six-month study duration:

Sana developed HIP-modified allogeneic islet cells, which cluster into effective endocrine organoids termed "pseudo islet grafts" (p-islets). HIP p-islets engrafted and provided stable endocrine function, enabling insulin independence in the absence of immunosuppression.
The allogeneic HIP p-islet graft survived for the six-month duration of the study with no indication of immune recognition of the HIP p-islet engraftment at any time.
To demonstrate that there was no regeneration or recovery of an endogenous islet cell population in the diabetic NHP, HIP p-islets were eliminated using an anti-CD47 antibody, demonstrating proof of principle of CD47 overexpression and a potential safety switch.
Published preclinical data in Nature Communications, Science Translational Medicine, and Nature Biotechnology describing immune evasion, persistence, and durable anti-tumor activity of HIP-modified CD19-directed CAR T cells and HIP-modified pseudo-islets control type 1 diabetes in preclinical models:

Sana developed HIP-modified CD19-targeted allogeneic CAR T cells and compared them to unmodified CD19-targeted allogeneic CAR T cells in a murine leukemia model with a humanized immune system. Although both HIP-modified and unmodified CAR T cells showed robust early tumor killing, cell durability was much greater in humanized mice treated with HIP-modified cells. HIP-modified allogeneic CAR T cells persisted and removed all evidence of tumor for the duration of the study. HIP-modified CAR T cells also cleared all evidence of tumor after re-injection with cancer cells 90 days into the study.

Preclinical data showed that p-islets survive, persist, escape allogeneic and autoimmune rejection, and normalize blood glucose in diabetic models with humanized immune systems.

Preclinical data demonstrated that HIP-modified cells survive allogeneic transplant across several species, including non-human primates with normal immune systems, and remain fully functional.
Advanced Sana’s HIP ex vivo platform with presentations at AACR (Free AACR Whitepaper), ADA, ISSCR, and ASH (Free ASH Whitepaper):

Presented preclinical data demonstrating that HIP-modified CAR T cells provide lasting tumor control in immunocompetent allogeneic humanized mice even with tumor re-challenge.
Presented preclinical data showing that HIP-modified CD19-directed CAR T cells have the potential to serve as a universal off-the-shelf therapy with long-term durability of response without immunosuppression.
Presented preclinical data showing HIP-modified primary pancreatic islet cells alleviate type 1 diabetes in humanized mice and avoid immune rejection without immunosuppression.
Presented preclinical data showing that intramuscular administration of islet cells in humanized mice does not impact cell function and viability and may serve as a preferred administration route for patients.
Presented preclinical data supporting HIP-modified CD22-directed and GPRC5D-directed allogeneic CAR T cell programs.
Presented preclinical data highlighting the SC379 glial progenitor cell program.
Completed financing with gross proceeds of approximately $189.8 million to further support activities to enable multiple data readouts and announced key corporate updates:

Closed on an upsized public offering in February 2024 of 21.8 million shares of Sana’s common stock, which includes the full exercise of the underwriter’s option, and pre-funded warrants to purchase 12.7 million shares of Sana’s common stock. The gross proceeds from this offering were approximately $189.8 million before deducting underwriting discounts and commissions and estimated offering expenses.
Strengthened the Research and Development leadership with the appointment of two seasoned drug developers, Doug Williams, Ph.D., as President of Research and Development, and Gary Meininger, M.D., as Chief Medical Officer.
Announced an increased focus on the ex vivo cell therapy platform based on extensive preclinical and early translational clinical data and a reduction in near-term investment on the fusogen in vivo delivery platform, resulting in an expected 2024 operating burn below $200 million.
Named on the BioSpace 2024 Best Places to Work small employers list for the second year in a row.
Fourth Quarter 2023 Financial Results

GAAP Results

Cash Position: Cash, cash equivalents, and marketable securities as of December 31, 2023 were $205.2 million compared to $434.0 million as of December 31, 2022. The decrease of $228.8 million was primarily driven by cash used in operations of $253.6 million and cash used for the purchase of property and equipment of $20.0 million. The decrease in cash was partially offset by net proceeds of $27.0 million from at the market equity offerings during the year ended December 31, 2023.

Research and Development Expenses: For the three and twelve months ended December 31, 2023, research and development expenses, inclusive of non-cash expenses, were $63.0 million and $268.8 million, respectively, compared to $63.9 million and $285.9 million for the same periods in 2022. The decrease of $0.9 million for the three months ended December 31, 2023 compared to the same period in 2022 was primarily due to decreased laboratory and research costs, partially due to the portfolio prioritizations in 2022 and 2023, a decline in personnel-related costs, including non-cash stock-based compensation, and lower costs for third-party manufacturing at CDMOs. These decreases were partially offset by costs incurred related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023 and increased clinical development costs. The decrease of $17.1 million for the twelve months ended December 31, 2023 compared to the same period in 2022 was primarily due to decreased laboratory and research costs partially due to the portfolio prioritizations in 2022 and 2023, lower costs for third-party manufacturing at CDMOs, decreased costs to acquire technology, and lower non-cash stock-based compensation expense. These decreases were partially offset by increased clinical development costs and costs incurred related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023. Research and development expenses include non-cash stock-based compensation of $4.9 million and $23.2 million, respectively, for the three and twelve months ended December 31, 2023, and $6.0 million and $26.6 million, for the same periods in 2022.

Research and Development Related Success Payments and Contingent Consideration: For the three and twelve months ended December 31, 2023, Sana recognized a non-cash expense of $6.8 million and a non-cash gain of $49.0 million, respectively, in connection with the change in the estimated fair value of the success payment liabilities and contingent consideration in aggregate, compared to gains of $5.5 million and $84.9 million for the same periods in 2022. The value of these potential liabilities may fluctuate significantly with changes in Sana’s market capitalization and stock price.

General and Administrative Expenses: General and administrative expenses for the three and twelve months ended December 31, 2023, inclusive of non-cash expenses, were $20.8 million and $73.3 million, respectively, compared to $23.3 million and $71.6 million for the same periods in 2022. The decrease of $2.5 million for the three months ended December 31, 2023 compared to the same period in 2022 was primarily due lower personnel-related costs, including non-cash stock-based compensation, a decrease in costs related to Sana’s previously planned manufacturing facility in Fremont, California (Fremont facility), which were formerly in research and development expense, and lower insurance costs. These decreases were partially offset by an increase in patent and other legal fees. The increase of $1.7 million for the twelve months ended December 31, 2023 compared to the same period in 2022 was primarily due to an increase in patent and other legal fees, a loss on termination of lease associated with the Fremont facility (Fremont lease), and increased facility costs. These increases were partially offset by the write-off of construction in progress costs in 2022 for the Fremont facility, and a decrease in insurance costs.

Net Loss: Net loss for the three and twelve months ended December 31, 2023 was $88.1 million, or $0.45 per share, and $283.3 million, or $1.46 per share, respectively, compared to $80.4 million, or $0.42 per share, and $269.5 million, or $1.43 per share for the same periods in 2022.

On February 29, 2024 Puma Biotechnology, Inc. (NASDAQ: PBYI), a biopharmaceutical company, reported financial results for the fourth quarter and year ended December 31, 2023. Unless otherwise stated, all comparisons are for the fourth quarter and full year 2023 compared to the fourth quarter and full year 2022 (Press release, Puma Biotechnology, FEB 29, 2024, View Source [SID1234640662]).

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Product revenue, net consists entirely of revenue from sales of NERLYNX, Puma’s first commercial product. Product revenue, net for the fourth quarter of 2023 was $53.2 million, compared to $53.7 million in the fourth quarter of 2022. Product revenue, net for the full year 2023 was $203.1 million, compared to $200.0 million in 2022.

Based on accounting principles generally accepted in the United States (GAAP), Puma reported net income of $12.3 million, or $0.26 per basic and diluted share, for the fourth quarter of 2023, compared to a net loss of $5.6 million, or $0.12 per basic and diluted share, for the fourth quarter of 2022. Net income for full year 2023 was $21.6 million, or $0.46 per basic share and $0.45 per diluted share, compared to a net income of $2,000, or $0.00 per basic and diluted share, for full year 2022.

Non-GAAP adjusted net income was $14.8 million, or $0.31 per basic and diluted share, for the fourth quarter of 2023, compared to non-GAAP adjusted net loss of $3.0 million, or $0.07 per basic and diluted share, for the fourth quarter of 2022. Non-GAAP adjusted net income for full year 2023 was $31.8 million, or $0.68 per basic share and $0.67 per diluted share, compared to non-GAAP adjusted net income of $11.8 million, or $0.26 per basic and diluted share, for full year 2022. Non-GAAP adjusted net income/loss excludes stock-based compensation expense. For a reconciliation of GAAP net income/loss to non-GAAP adjusted net income/loss and GAAP net income/loss per share to non-GAAP adjusted net income/loss per share, please see the financial tables at the end of this news release.

Net cash provided by operating activities for the fourth quarter of 2023 was $10.4 million, compared to $7.7 million for the fourth quarter of 2022. Net cash provided by operating activities for full year 2023 was $27.0 million, compared to net cash used in operating activities of $15.8 million for full year 2022. At December 31, 2023, Puma had cash, cash equivalents, and marketable securities of $96.0 million, compared to cash, cash equivalents, and marketable securities of $81.1 million at December 31, 2022.

"We are pleased to report positive net income for both the fourth quarter and full year 2023," said Alan H. Auerbach, Chairman, Chief Executive Officer and President of Puma. "NERLYNX sales in the fourth quarter were negatively impacted by the lower enrollments seen in Q3, as well as a higher than expected gross to net for the quarter. We have continued to reduce our internal expenses to account for this higher gross to net and lower Q3 enrollments, as we recognize our fiscal responsibility to continue to be net income positive in 2024. Puma also continues to execute on the clinical development of alisertib, and in February, we were pleased to initiate ALISertib in CAncer (ALISCA-Lung1), a Phase II clinical trial of alisertib monotherapy for the treatment of patients with extensive stage small cell lung cancer."

Mr. Auerbach added, "We anticipate the following key milestones over the next 12 months: (i) presentation of biomarker studies from the randomized trial of alisertib plus fulvestrant versus alisertib alone in hormone receptor positive, HER2-negative breast cancer (H1 2024); (ii) updated data from the clinical trial of alisertib in combination with osimertinib in patients with metastatic EGFR-mutant non small cell lung cancer who have developed osimertinib resistance (H1 2024); (iii) initiation of ALISCA-Breast1, a Phase II trial of alisertib in combination with endocrine treatment in patients with chemotherapy-naïve HER2-negative, hormone receptor-positive metastatic breast cancer (Q4 2024); and (iv) interim data from ALISCA-Lung1, a Phase II clinical trial of alisertib monotherapy for the treatment of patients with extensive stage small cell lung cancer (H2 2024)."

Revenue

Total revenue consists of product revenue, net from sales of NERLYNX, license revenue and royalty revenue. For the fourth quarter of 2023, total revenue was $72.2 million, of which $53.2 million was product revenue, net, and $19.0 million was royalty revenue. This compares to total revenue of $65.7 million for the fourth quarter of 2022, of which $53.7 million was product revenue, net, and $12.0 million was royalty revenue. For the year ended December 31, 2023, total revenue was $235.6 million, of which $203.1 million was product revenue, net, and $32.5 million was royalty revenue. This compares to total revenue in 2022 of $228.0 million, of which $200.0 million was product revenue, net, and $28.0 million was royalty revenue.

Operating Costs and Expenses

Total operating costs and expenses were $57.4 million for the fourth quarter of 2023, compared to $55.7 million for the fourth quarter of 2022. Total operating costs and expenses were $203.0 million for full year 2023, compared to $204.3 million for full year 2022.

Cost of Sales

Cost of sales was $24.3 million for the fourth quarter of 2023, compared to $16.8 million for the fourth quarter of 2022. Cost of sales was $62.7 million for full year 2023, compared to cost of sales of $55.1 million for full year 2022.

Selling, General and Administrative Expenses

Selling, general and administrative (SG&A) expenses were $20.2 million for the fourth quarter of 2023, compared to $25.1 million for the fourth quarter of 2022. SG&A expenses for full year 2023 were $89.9 million, essentially unchanged from $90.0 million for full year 2022. The slight increase includes an increase in payroll and related costs of approximately $3.5 million, primarily due to a one-time $2.0 million CARES Act credit in 2022, increased compensation of $1.5 million in 2023, and a $0.9 million credit loss reserve. These increases were offset by a decrease of $4.1 million in professional fees and expenses related to consultants and contractors, as well as lower insurance expenses and administrative costs.

Research and Development Expenses

Research and development (R&D) expenses were $12.9 million for the fourth quarter of 2023, compared to $13.8 million for the fourth quarter of 2022. R&D expenses for full year 2023 were $50.4 million, compared to $52.2 million for full year 2022. The $1.8 million decrease in R&D expenses during full year 2023 compared to full year 2022 resulted primarily from the reduction and closure of NERLYNX clinical trial sites of approximately $4.7 million, partially offset by an increase in internal R&D expenses of approximately $3.2 million, primarily due to a tax credit recorded during the year ended December 31, 2022 under the CARES Act, without a comparable tax credit in 2023.

Acquired In-Process Research and Development Expense

Puma recorded acquired in-process R&D expense related to an alisertib up-front payment of $7.0 million during the year ended December 31, 2022. No similar expenses were recorded in 2023.

Total Other Income (Expenses)

Total other expenses were $2.0 million for the fourth quarter of 2023, compared to $15.3 million for the fourth quarter of 2022. Total other expenses were $9.9 million for full year 2023, compared to $23.2 million for full year 2022. The $13.3 million decrease in other expenses in full year 2023 resulted primarily from legal verdict expenses recorded in 2022, with no similar accruals in 2023, as well as an increase in other income related to higher interest rates in 2023.

First Quarter 2024 and Full Year 2024 Financial Outlook

First Quarter 2024

Full Year 2024

Net Product Revenue

$38 – $40 million

$183 – $190 million

Royalty Revenue

$2.5 – $3 million

$30 – $33 million

License Revenue

$0 million

$1 – $2 million

Net Income/(Loss)

$(10) – $(12) million

$12 – $15 million

Gross to Net Adjustment

23% – 24%

21.5% – 22.5%

Conference Call

Puma Biotechnology will host a conference call to discuss its fourth quarter and full year 2023 financial results and provide an update on Puma’s business and outlook at 1:30 p.m. PST/4:30 p.m. EST on Thursday, February 29, 2024. The call may be accessed by dialing 1-877-709-8150 (domestic) or 1-201-689-8354 (international). Please dial in at least 10 minutes in advance and inform the operator that you would like to join the "Puma Biotechnology Conference Call." A live webcast of the conference call and presentation slides may be accessed on the Investors section of the Puma Biotechnology website at View Source A replay of the call will be available approximately one hour after completion of the call and will be archived on Puma’s website for 90 days.

On February 29, 2024 Precision BioSciences, Inc. (Nasdaq: DTIL) ("Precision"), an advanced gene editing company utilizing its novel proprietary ARCUS platform to develop in vivo gene editing therapies for sophisticated gene edits, including gene insertion, excision, and elimination, reported the commencement of a proposed underwritten public offering of its common stock and accompanying warrants to purchase shares of common stock, including pre-funded warrants to purchase common stock in lieu of common stock for certain purchasers (Press release, Precision Biosciences, FEB 29, 2024, View Source [SID1234640660]). All shares of common stock, pre-funded warrants and accompanying warrants to be sold in the proposed offering will be sold by Precision. The pre-funded warrants will be issued to certain purchasers who have elected to purchase them in lieu of shares of common stock in this offering.

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Precision also expects to grant the underwriters a 30-day option to purchase up to an additional 15% of the total number of shares of common stock and warrants to purchase shares of common stock (including shares underlying the pre-funded warrants) to be offered at the public offering price, less the underwriting discount. The offering is subject to market and other conditions and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

Guggenheim Securities, LLC is acting as sole book-running manager for the offering.

The securities described above are being offered pursuant to an effective shelf registration statement (File No. 333-272540) that was filed with the U.S. Securities and Exchange Commission ("SEC") on June 9, 2023. This offering will be made only by means of a prospectus supplement and the accompanying prospectus that forms a part of the effective shelf registration statement.

A preliminary prospectus supplement related to the offering (including the accompanying prospectus) will be filed with the SEC and will be available on the SEC’s website located at www.sec.gov. Copies of the preliminary prospectus supplement and the accompanying prospectus may also be obtained, when available, by contacting: Guggenheim Securities, LLC, Attention: Equity Syndicate Department, 330 Madison Avenue, 8th Floor, New York, NY 10017, by telephone at (212) 518-9544, or by email at [email protected].

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the securities in this offering in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

On February 29, 2024 PMV Pharmaceuticals, Inc. (Nasdaq: PMVP), a precision oncology company pioneering the discovery and development of small molecule, tumor-agnostic therapies targeting p53, reported financial results for the fourth quarter and full year ended December 31, 2023, and provided a corporate update (Press release, PMV Pharma, FEB 29, 2024, View Source [SID1234640659]).

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"PMV continues to make significant progress with rezatapopt, a first-in-class precision oncology investigational therapy in patients with advanced solid tumors with a p53 Y220C mutation," said David Mack, Ph.D., President and Chief Executive Officer of PMV Pharma. "Our registrational, tumor-agnostic Phase 2 clinical trial remains on track to initiate in the first quarter of this year."

Dr. Mack added, "We have extended our cash runway to the end of 2026 by prioritizing the development of rezatapopt and refocusing our discovery research efforts. We look forward to advancing the rezatapopt clinical program to bring a much-needed new treatment option to patients."

Full Year 2023 and Recent Corporate Highlights:

•
Charles Baum, M.D., Ph.D., former Mirati Chief Executive Officer, appointed to serve as senior clinical advisor.

•
Phase 1 analysis from the PYNNACLE Phase 1/2 study of rezatapopt in a subgroup of patients with advanced ovarian cancer harboring a TP53 Y220C mutation selected as a late-breaking oral presentation at the 2024 SGO Annual Meeting on Women’s Cancer. The data will be presented on March 18, 2024 during the Scientific Plenary V Late-Breaking Abstract Session 2, from 2:30 PM – 3:45 PM PT.

•
Prioritization of rezatapopt development and focused discovery research efforts resulted in a workforce reduction; cost savings expected to extend cash runway to end of 2026.

•
Updated data from Phase 1 PYNNACLE clinical trial presented at the 2023 AACR (Free AACR Whitepaper)-NCI-EORTC AACR-NCI-EORTC (Free AACR-NCI-EORTC Whitepaper) International Conference on Molecular Targets and Cancer Therapeutics (EORTC-NCI-AACR) (Free ASGCT Whitepaper) (Free EORTC-NCI-AACR Whitepaper) demonstrated responses across multiple tumor types with a median duration of response of seven months and a confirmed overall response rate of 38% at the Recommended Phase 2 dose (RP2D) of
2000 mg daily for the intended Phase 2 population of TP53 Y220C and KRAS wild-type patients.

•
Concluded successful End-of-Phase 1 U.S. Food and Drug Administration (FDA) meeting with alignment on RP2D and key elements of single arm, tumor agnostic Phase 2 registrational portion of PYNNACLE study.

•
Deepika Jalota, Pharm.D., Chief Development Officer, and Marc Fellous, M.D., Senior Vice President, Head of Clinical Development and Medical Affairs appointed to lead the rezatapopt clinical program.

•
Promoted Michael Carulli to Chief Financial Officer and appointed Masha Poyurovsky, Ph.D., as Vice President of Biology.

•
Initiated enrollment in the combination arm of the PYNNACLE study with rezatapopt and KEYTRUDA (pembrolizumab).

Fiscal Year 2023 Financial Results

•
As of December 31, 2023, PMV Pharma had $228.6 million in cash, cash equivalents, and marketable securities, compared to $243.5 million at December 31, 2022. Net cash used in operations was $55.7 million for the year ended December 31, 2023, compared to $63.8 million for the year ended December 31, 2022.

•
Net loss for the year ended December 31, 2023, was $69.0 million compared to $73.3 million for the year ended December 31, 2022.

•
Research and development (R&D) expenses were $55.9 million for the year ended December 31, 2023, compared to $52.0 million for the year ended December 31, 2022. The increase in R&D expenses was primarily related to increased headcount and clinical expenses for advancing rezatapopt, the Company’s lead drug candidate.

•
General and administrative (G&A) expenses were $24.2 million for the year ended December 31, 2023, compared to $25.1 million for the year ended December 31, 2022. The decrease in G&A expenses was primarily due to facility-related costs now allocated to research as our new laboratory building in Princeton, NJ began operations.

KEYTRUDA (pembrolizumab) is a registered trademark of Merck Sharp & Dohme LLC., a subsidiary of Merck & Co., Inc., Rahway, NJ, USA.

About Rezatapopt

Rezatapopt (PC14586) is a first-in-class, small molecule, p53 reactivator designed to selectively bind to the pocket in the p53 Y220C mutant protein, restoring the wild-type, or normal, p53 protein structure and tumor-suppressing function. The U.S. Food and Drug Administration (FDA) granted Fast Track designation to rezatapopt for the treatment of patients with locally advanced or metastatic solid tumors with a p53 Y220C mutation.

On February 29, 2024 Pacira BioSciences, Inc. (Nasdaq: PCRX), the industry leader in its commitment to non-opioid pain management and regenerative health solutions, reported financial results for the fourth quarter and full-year of 2023 (Press release, Pacira Pharmaceuticals, FEB 29, 2024, View Source;991.htm [SID1234640658]).

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"Now that I have spent several weeks working with the Pacira team, I am even more enthusiastic to lead this great company as we build upon an impressive foundation of success," said Frank D. Lee, chief executive officer of Pacira BioSciences. "Looking ahead, we are sharply focused on driving long-term growth, furthering our patient centric culture and establishing high standards for operational excellence. Throughout 2024, we plan to advance the launch of EXPAREL in two key lower extremity nerve blocks and prepare for the significant catalyst ahead in NOPAIN. In parallel, we are taking the necessary steps to reallocate our efforts and resources to ensure the organization is best positioned for sustainable success.
We have the people, the purpose, and the products to change the course of pain management and, hopefully, to help save patients from the deadly effects of opioid addiction."
2023 Fourth Quarter and Full-Year Financial Highlights
•Fourth quarter revenues of $181.2 million and full-year revenues of $675.0 million.
•Fourth quarter GAAP net income of $24.9 million or $0.54 per basic share and $0.50 per diluted share and full-year GAAP net income of $42.0 million or $0.91 per basic share and $0.89 per diluted share.
•Fourth quarter adjusted EBITDA of $65.4 million and full-year adjusted EBITDA of $214.5 million.
See "Non-GAAP Financial Information" below.
Recent Business Highlights
•FDA Approval of New EXPAREL 200-liter Manufacturing Suite. In February 2024, the U.S. Food and Drug Administration (FDA) approved the company’s supplemental New Drug Application (sNDA) for its 200-liter EXPAREL manufacturing suite in San Diego, CA. The company expects to start selling commercial product manufactured at this 200-liter suite later this year, which will help drive a more favorable mix of commercial product sold and benefit EXPAREL gross margins over time.
•Frank D. Lee Appointed as Chief Executive Officer. In December 2023, the company’s Board of Directors appointed Frank D. Lee as chief executive officer and a member of the Board, effective January 2, 2024. Mr. Lee brings more than three decades of global experience and a strong track

record of product development and commercial leadership success across a wide range of therapeutic areas within the biotech and pharmaceutical industry. Most recently he served as chief executive officer and member of the board of directors of Forma Therapeutics from March 2019 through its acquisition by Novo Nordisk in October 2022. During his tenure at Forma, Mr. Lee transformed the company from an early-stage drug discovery company into one focused on the clinical development of lead assets in rare hematologic disorders and cancer. Prior to Forma, Mr. Lee spent 13 years at Genentech, a member of the Roche Group, in a series of leadership positions of increasing scope and responsibility for delivering transformative medicines to patients.
•FDA Approval of Expanded EXPAREL Label to Include Two Additional Nerve Block Indications. In November 2023, the FDA approved the company’s sNDA to expand the EXPAREL label to include administration in adults as an adductor canal block and a sciatic nerve block in the popliteal fossa. The approval is supported by a Phase 3 program data supporting EXPAREL as the first and only single-dose product to safely demonstrate four days of superiority versus bupivacaine. EXPAREL achieved statistical significance in postsurgical pain, opioid consumption and percentage of opioid-free patients (P<0.01).
•Two New EXPAREL Patents. In November 2023, the United States Patent and Trademark Office issued Patent Nos. 11,819,574 and 11,819,575, claiming composition of EXPAREL prepared by an enhanced manufacturing process and composition of matter for EXPAREL, respectively. Each of these EXPAREL patents are listed in the FDA’s "Approved Drug Products with Therapeutic Equivalence Evaluations" (the "Orange Book"). These two patents are among the ten Orange Book listed patents that are now listed for EXPAREL, all with an expiration date of January 22, 2041.
Fourth Quarter 2023 Financial Results
•Total revenues were $181.2 million in the fourth quarter of 2023, a 5% increase over the $172.0 million reported for the fourth quarter of 2022.
•EXPAREL net product sales were $143.9 million in the fourth quarter of 2023, a 4% increase over the $138.0 million reported for the fourth quarter of 2022.
•ZILRETTA net product sales were $28.7 million in the fourth quarter of 2023, a 3% increase over the $28.0 million reported for the fourth quarter of 2022.
•Fourth quarter 2023 iovera° net product sales were $6.0 million, a 32% increase over the $4.6 million reported in the fourth quarter of 2022.
•Sales of bupivacaine liposome injectable suspension to third-party licensees were $1.1 million in the fourth quarter of 2023, versus the $1.0 million reported for the fourth quarter of 2022.
•Total operating expenses were $148.1 million in the fourth quarter of 2023, versus the $181.8 million reported for the fourth quarter of 2022. Included in operating expenses in 2022 was a $26.1 million impairment of acquired in-process research and development (IPR&D).
•Research and development (R&D) expenses were $19.5 million in the fourth quarter of 2023, compared to $17.5 million in the fourth quarter of 2022. The company’s R&D expenses included $6.9 million and $7.3 million of product development and manufacturing capacity expansion costs in the fourth quarters of 2023 and 2022, respectively.
•Selling, general and administrative (SG&A) expenses were $65.8 million in the fourth quarter of 2023, compared to $64.0 million in the fourth quarter of 2022.

•GAAP net income was $24.9 million, or $0.54 per basic share and $0.50 per diluted share in the fourth quarter of 2023, compared to a GAAP net loss of $10.1 million, or $0.22 per basic and diluted share in the fourth quarter of 2022.
•Non-GAAP net income was $45.1 million, or $0.97 per basic share and $0.89 per diluted share in the fourth quarter of 2023, compared to $37.0 million, or $0.81 per basic share and $0.73 per diluted share in the fourth quarter of 2022.
•Adjusted EBITDA was $65.4 million in the fourth quarter of 2023, a 11% increase compared to $58.8 million in the fourth quarter of 2022.
•Pacira ended the fourth quarter of 2023 with cash, cash equivalents and available-for-sale investments ("cash") of $281.0 million. Cash provided by operations was $47.6 million in the fourth quarter of 2023, compared to $42.0 million in the fourth quarter of 2022.
•Pacira had 46.4 million basic and 52.1 million diluted weighted average shares of common stock outstanding in the fourth quarter of 2023.
•For non-GAAP measures, Pacira had 52.1 million and 51.9 million diluted weighted average shares of common stock outstanding in the fourth quarter of 2023 and 2022, respectively.
See "Non-GAAP Financial Information" below.
Full-Year 2023 Financial Results
•Total revenues were $675.0 million in 2023, a 1% increase over the $666.8 million reported in 2022.
•EXPAREL net product sales were $538.1 million in 2023, a nominal increase compared to the $536.9 million reported in 2022. There were two less selling days in 2023 compared to 2022.
•ZILRETTA net product sales were $111.1 million in 2023, a 5% increase over the $105.5 million reported in 2022.
•Full-year iovera° net product sales were $19.7 million, a 29% increase over the $15.3 million reported in 2022.
•Full-year sales of bupivacaine liposome injectable suspension to third-party licensees were $3.3 million in 2023, versus the $6.5 million reported in 2022.
•Total operating expenses were $587.3 million in 2023, compared to $606.8 million in 2022.
•R&D expenses were $76.3 million in 2023, compared to $84.8 million in 2022. The company’s R&D expenses include $33.4 million and $24.6 million of product development and manufacturing capacity expansion costs in 2023 and 2022, respectively.
•SG&A expenses were $269.4 million in 2023, compared to $254.5 million in 2022.
•GAAP net income was $42.0 million, or $0.91 per basic share and $0.89 per diluted share in 2023, compared to $15.9 million, or $0.35 per basic share and $0.34 per diluted share in 2022.
•Non-GAAP net income was $142.0 million, or $3.07 per basic share and $2.81 per diluted share in 2023, compared to $120.7 million, or $2.65 per basic share and $2.39 per diluted share in 2022.
•Adjusted EBITDA was $214.5 million in 2023, a 1% increase over $212.7 million in 2022.
•Cash provided by operations was $154.6 million in 2023, compared to $145.3 million in 2022.
•Pacira had 46.2 million basic and 52.0 million diluted weighted average shares of common stock outstanding in 2023.

•For non-GAAP measures, Pacira had 52.0 million and 52.7 million diluted weighted average shares of common stock outstanding in 2023 and 2022, respectively.
See "Non-GAAP Financial Information" below.
2024 Financial Guidance
Today the company is providing full-year 2024 financial guidance as follows:
•Total revenue of $680 million to $705 million;
•Non-GAAP gross margin of 74% to 76%;
•Non-GAAP R&D expense of $70 million to $80 million;
•Non-GAAP SG&A expense of $245 million to $265 million; and
•Stock-based compensation of $50 million to $55 million.
See "Non-GAAP Financial Information" below.
Today’s Conference Call and Webcast Reminder
The Pacira management team will host a conference call to discuss the company’s financial results and recent developments today, Thursday, February 29, 2024, at 8:30 a.m. ET. For listeners who wish to participate in the question-and-answer session via telephone, please pre-register at investor.pacira.com/upcoming-events. All registrants will receive dial-in information and a PIN allowing them to access the live call. In addition, a live audio of the conference call will be available as a webcast. Interested parties can access the event through the "Events" page on the Pacira website at investor.pacira.com.

Non-GAAP Financial Information
This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), such as non-GAAP gross margin, non-GAAP cost of goods sold, non-GAAP research and development (R&D) expense, non-GAAP selling, general and administrative (SG&A) expense, non-GAAP net income, non-GAAP net income per common share, non-GAAP weighted average diluted common shares outstanding, EBITDA (earnings before interest, taxes, depreciation and amortization) and adjusted EBITDA, because these non-GAAP financial measures exclude the impact of items that management believes affect comparability or underlying business trends.

These measures supplement the company’s financial results prepared in accordance with GAAP. Pacira management uses these measures to better analyze its financial results, estimate its future cost of goods sold, R&D expense and SG&A expense outlook for 2024 and to help make managerial decisions. In management’s opinion, these non-GAAP measures are useful to investors and other users of the company’s financial statements by providing greater transparency into the ongoing operating performance of Pacira and its future outlook. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. The non-GAAP measures presented here are also unlikely to be comparable with non-GAAP disclosures released by other companies. See the tables below for a reconciliation of GAAP to non-GAAP measures.