On August 1, 2019 BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) (BioMarin or the Company) reported financial results for the second quarter ended June 30, 2019 (Press release, BioMarin, AUG 1, 2019, View Source [SID1234538004]).
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Total Net Product Revenues for the second of quarter 2019 increased to $379.1 million, compared to $367.8 million for the second quarter of 2018. The increase in Net Product Revenues was attributed to the following:
Palynziq Net Product Revenues during the second quarter of 2019 totaled $18.8 million driven primarily by new patients initiating therapy in the U.S. as the product launched in the third quarter of 2018. Palynziq received approval from the U.S. Food and Drug Administration (FDA) in May 2018 and from the European Medicines Agency (EMA) in May 2019. EU commercial sales are expected to commence in the third quarter of 2019; and
Naglazyme Net Product Revenues increased by $7.1 million, or 8%, primarily due to increased sales volume driven by government ordering patterns from certain Latin American and European countries, partially offset by
Aldurazyme Net Product Revenues decreased $18.2 million, due to the timing of customer acceptance for product shipped to Genzyme in the second quarter for which no revenue was recognized as of June 30, 2019. Aldurazyme revenue recognition is based on timing of Genzyme acceptance of product shipment. Approximately $23.0 million of Aldurazyme revenue that was shipped in the second quarter is expected to be recognized in the third quarter of 2019 once product has been accepted by Genzyme. The delay was due to a change in the location where Genzyme receives product. Genzyme’s Aldurazyme revenues, as provided to BioMarin by Genzyme, increased $11.6 million or 9% during the six months ended June 30, 2019, compared to the same period in 2018. Full-year total Aldurazyme revenues are expected to be consistent with full-year Aldurazyme revenues in prior years and in the $100.0 to $120.0 million range; and
Vimizim Net Product Revenues decreased by $4.9 million, or 4%, primarily due to decreased sales volume driven by government ordering patterns in certain Latin American, Middle Eastern and European countries.
The increase in GAAP Net Loss for the second quarter of 2019, compared to the same period in 2018 was primarily due to the following:
higher research and development (R&D) expense related to preclinical activities for our PKU gene therapy development program and clinical activities for our valoctocogene roxaparvovec and vosoritide development programs, offset by decreased R&D expense related to Palynziq for which we began capitalizing manufacturing costs upon FDA approval in May 2018 and a decrease in tralesinidase alfa clinical manufacturing costs. R&D expenses in the quarter were consistent with 2019 guidance despite the acceleration of the valoctocogene roxaparvovec development program and subsequent activities implemented to pursue an expedited regulatory path forward; and
higher intangible asset amortization related to the Palynziq in-process research and development assets that were placed into service following EU approval in May 2019; and
higher selling, general and administrative (SG&A) expense in support of the EU commercial launch and continued U.S. expansion of Palynziq, pre-commercialization activities related to valoctocogene roxaparvovec and increased general and administrative expense primarily attributed to personnel-related costs resulting from increased headcount to support our growth; partially offset by;
increased gross profits of $12.9 million driven by increased product sales.
The increase in GAAP Net Loss for the second quarter of 2019 did not affect the Company’s full-year GAAP Net Loss Guidance, which remains unchanged.
Non-GAAP Income for the second quarter of 2019 decreased $2.8 million, or 14%, to $17.1 million, compared to $19.9 million for the same period in 2018. The decrease in Non-GAAP Income for the quarter, compared to the same period in 2018, was attributed to higher R&D expense and SG&A expense, partially offset by increased gross profit from sales as described above. The decrease in Non-GAAP Income for the second quarter of 2019 did not affect the Company’s full-year Non-GAAP Income Guidance, which remains unchanged.
As of June 30, 2019, BioMarin had cash, cash equivalents and investments totaling approximately $1.1 billion, as compared to $1.3 billion on December 31, 2018.
Commenting on second quarter results, Jean-Jacques Bienaimé, Chairman and Chief Executive Officer of BioMarin, said, "During the first half of 2019 we laid the foundation for a number of significant milestones anticipated over the coming months. We recently announced our plans to submit marketing applications for valoctocogene roxaparvovec gene therapy for severe hemophilia A in both the United States and Europe. We expect to submit both applications in the fourth quarter of this year based on recent interactions with health authorities in those regions. We are pleased
to have the opportunity to initiate the first review of a marketing application for any type of hemophilia indication with a gene therapy product. With valoctocogene roxaparvovec people with severe hemophilia A may soon have the opportunity to experience improved quality of life, including consequences of bleeding, physical functioning, role functioning, emotional impact, treatment concern, and worry. We are very grateful that health authorities are aligned in their focus to expedite the review of this potentially transformative treatment option given the unmet need with current standard of care."
Mr. Bienaimé continued, "Phase 3 results from another potential commercial product, vosoritide for the treatment of achondroplasia, are expected to read-out at the end of this year. Our newest study, a global Phase 2 with vosoritide in infants and young children (less than 60 months old) with achondroplasia is enrolling very well. We expect all subjects ages 6 months through 5 years to be enrolled by year-end. We have been very pleased with the high-level of enthusiasm from families wanting to participate in this program and look forward to starting enrollment in the youngest cohort, infants up to 6 months old, later this year. Another very significant opportunity that is gaining momentum is the global commercialization of Palynziq. We have been very pleased with the pace of the U.S. launch, as we ended the second quarter with 551 patients on reimbursed Palynziq, and an additional 158 naive patients having completed enrollment and awaiting their first injection. Building on this success and as part of our strategy to increase our leadership in the PKU market, we anticipate the submission of an investigational new drug application (IND) and/or a clinical trial application (CTA) for BMN 307, our gene therapy product for PKU, in the second half of 2019. BMN 307 demonstrated lifetime normalization of Phe in a validated PKU mouse model, and as a result, we believe it has the potential to be an important new treatment and market expander as part of our PKU franchise."
2019 Full-Year Financial Guidance unchanged (in millions, except %)
* All Financial Guidance items are calculated based on U.S. GAAP with the exception of Non-GAAP Income/Loss. Refer to Non-GAAP Information beginning on page 9 of this press release for a complete discussion of the Company’s Non-GAAP financial information and reconciliations to the corresponding GAAP reported information.
Key Program Highlights
Valoctocogene roxaparvovec gene therapy for hemophilia A: On July 8, the Company announced that based on recent meetings with health authorities in the U.S. and Europe, it plans to submit marketing applications to both the FDA and the European Medicines Agency (EMA) in the fourth quarter of 2019 for its investigational gene therapy, valoctocogene roxaparvovec, for adults with severe hemophilia A.
These submissions will be based on the updated three-year Phase 1/2 data and the recently completed Phase 3 interim analysis of patients treated with valoctocogene roxaparvovec material from the to-be-commercialized process. Both submissions are expected to represent the first time a gene therapy product for any type of hemophilia indication will be reviewed for marketing authorization by health authorities.
The Company has chosen to cease development of the 4e13 vg/kg dose of valoctocogene roxaparvovec given the overwhelming preference by patients to be treated with the 6e13 vg/kg dose. Enrollment continues in the GENEr8-1 Phase 3 study and the 52 week results are anticipated at the end of 2020.
Palynziq for PKU: Palynziq, an injection to reduce blood Phe concentrations in adult patients with PKU, was added to BioMarin’s commercial product portfolio upon its U.S. approval May 2018. As of June 30, 2019, 551 patients were on reimbursed Palynziq, with an additional 158 naïve patients enrolled and awaiting their first treatment with commercial Palynziq. Of the 551 patients on therapy at the end of the second quarter, 410 were formerly naïve patients and 141 transitioned from clinical studies. Of the 125 PKU clinics in the U.S., 92 unique clinics had at least one complete patient enrollment in the REMS program as of June 30, 2019.
On May 6, 2019, the European Commission (EC) granted marketing authorization for Palynziq at doses of up to 60 milligrams once daily, to reduce blood Phe concentrations in patients with PKU aged 16 and older, who have inadequate blood Phe control (blood Phe levels greater than 600 micromol/L) despite prior management with available treatment options. In addition, the EC acknowledged that the Phase 3 trial and extension study is suggestive of an improvement in inattention and mood symptoms.
Vosoritide for children with achondroplasia: On June 18, 2019, the New England Journal of Medicine published the 42 month results from the Phase 2 study with vosoritide in children ages 5 to 14 years. The results also appeared in the July 4 printed issue. BioMarin expects to have over 5 years of clinical data from this Phase 2 study to corroborate maintenance of effect at the time of anticipated marketing application submissions.
The Company expects top line results from the ongoing global, Phase 3 study by year-end 2019. The vosoritide development program includes four distinct areas of focus to support global approval, including a large contemporaneous natural history study which is underway. The global Phase 3 study, which is fully enrolled, is a randomized, placebo-controlled study of vosoritide in approximately 110 children with achondroplasia between the ages of 5 to 14 years.
In 2018, BioMarin began a global Phase 2 study with vosoritide in infants and young children (newborn to 60 months old) with achondroplasia, to determine the impact of treatment in this age group. Three cohorts, segmented by age, are being enrolled in this study. Cohort 1 includes children ages 24 to 60 months old and has completed enrollment. Cohort 2 includes children ages 6 to 24 months old and is expected to complete enrollment by year-end. The Company plans to begin enrolling infants up to 6 months old by year-end.
Tralesinidase alfa (formerly referred to as BMN 250) for MPS IIIB (Sanfilippo Syndrome, Type B): Tralesinidase alfa is currently being evaluated in ongoing natural history and clinical trials. Previously, encouraging signs of biochemical and clinical efficacy have been suggested. Trials are ongoing to collect further data in regard to the untreated natural history of the condition, as well as biochemical and clinical outcomes of therapy.
BMN 307 gene therapy product candidate for phenylketonuria (PKU): As previously announced, the Company expects to submit an IND and/or a CTA for a gene therapy product for the treatment of PKU in the second half of 2019. At R&D Day 2018, BioMarin shared data with BMN 307 that demonstrated a lifetime Phe correction sustained at 80 weeks in preclinical mouse models. BMN 307 is an AAV vector containing the DNA sequence that codes for the phenylalanine hydroxylase enzyme that is deficient in people with PKU. Product to support clinical evaluation will be produced at BioMarin’s gene therapy manufacturing facility, where valoctocogene roxaparvovec is currently made, using a commercial scale manufacturing process to facilitate rapid clinical development.
BMN 290 for Friedreich’s Ataxia: The Company reported plans to cease the preclinical studies in the BMN 290 program based on progress of other portfolio assets that have demonstrated stronger product profiles.
BioMarin will host a conference call and webcast to discuss second quarter 2019 financial results today, Thursday, August 1, 2019 at 4:30 p.m. ET. This event can be accessed on the investor section of the BioMarin website at www.biomarin.com.
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Conference ID: 6989536