On May 9, 2018 BeiGene, Ltd. (NASDAQ:BGNE), a commercial-stage biopharmaceutical company focused on developing and commercializing innovative molecularly targeted and immuno-oncology drugs for the treatment of cancer, reported recent business highlights and financial results for the first quarter of 2018 (Press release, BeiGene, MAY 9, 2018, View Source;p=RssLanding&cat=news&id=2348272 [SID1234526360]).
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"We continue to make great progress launching new clinical trials on a global scale for patients with a wide variety of cancers, where we believe our investigational treatments can have a profound impact," said John V. Oyler, Founder, Chief Executive Officer, and Chairman of BeiGene. "We have now enrolled more than 2,300 patients worldwide in more than 30 clinical trials of our investigational agents as of the end of March 2018 and remain on target for our first NDA filings in China later this year."
"Given the significantly reformed regulatory environment in China, as well as important additions to our senior leadership team highlighted by the appointment of Dr. Xiaobin Wu as our General Manager of China and President of BeiGene, Ltd., we are excited about our China and global prospects," continued Mr. Oyler.
Recent Business Highlights
Clinical Programs:
Zanubrutinib (BGB-3111), an investigational small molecule inhibitor of Bruton’s tyrosine kinase (BTK)
Completed enrollment in the Phase 2 pivotal trial in China in patients with Waldenström macroglobulinemia (WM).
Tislelizumab (BGB-A317), an investigational humanized monoclonal antibody against the immune checkpoint receptor PD-1
Initiated the following trials:
• Global Phase 2 trial in patients with relapsed or refractory mature T- and natural killer (NK)-cell lymphomas; and
• Global Phase 2 trial in patients with previously treated hepatocellular carcinoma (HCC or liver cancer), under collaboration with Celgene Corporation for solid tumors.
Pamiparib (BGB-290), an investigational small molecule PARP inhibitor
Presented preliminary Phase 1 clinical data in Chinese patients with ovarian or triple-negative breast cancer at the 2018 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting in Chicago.
Commercial Products:
Continued to expand potential patient access to ABRAXANE (nanoparticle albumin-bound paclitaxel) in China by obtaining inclusion in the provincial reimbursement drug list in Jiangsu and critical illness insurance in Zhejiang; and
Launched a first-line indication of REVLIMID (lenalidomide) in China following its regulatory approval by the China Food and Drug Administration (CFDA) for the treatment of multiple myeloma (MM) in combination with dexamethasone in adult patients with previously untreated MM who are not eligible for transplant.
Corporate Development:
Appointed J. Samuel Su, former Vice Chairman of the Board of Directors of Yum! Brands, Inc. and Chairman and CEO of its China division, to the BeiGene Board of Directors;
Appointed Dr. Xiaobin Wu to the position of General Manager of China and President of BeiGene, Ltd.;
Appointed Yifei Zhu to the position of China Co-Commercial Head, Sales and Market Access; and
Appointed Dr. Guillaume Vignon to the position of Senior Vice President, Business Development.
Expected Upcoming Milestones in 2018
Zanubrutinib
Present updated Phase 1 clinical data in patients with WM and pooled safety analysis in patients with hematologic malignancies at the 2018 European Hematology Association (EHA) (Free EHA Whitepaper) Annual Congress in Stockholm, Sweden, June 14-17;
Present other updated Phase 1 data and China pivotal trial data;
Submit first new drug application (NDA) in China for mantle cell lymphoma;
Complete enrollment in the global Phase 3 trial for WM in Q3 2018; and
Initiate a global head-to-head Phase 3 trial versus ibrutinib in relapsed/refractory chronic lymphocytic leukemia.
Tislelizumab
Present updated Phase 1 data and China pivotal trial data;
Submit first NDA in China for Hodgkin’s lymphoma;
Complete enrollment in the Phase 2 pivotal trial in China for urothelial carcinoma; and
Initiate additional pivotal trials.
Pamiparib
Present updated Phase 1 data;
Initiate a global Phase 3 trial in gastric cancer in Q2 or Q3 2018; and
Initiate a Phase 3 trial in China as maintenance therapy in patients with platinum-sensitive recurrent ovarian cancer.
Commercial Products
Continue to expand provincial reimbursement for ABRAXANE in China.
First Quarter 2018 Financial Results
Cash, Cash Equivalents, Restricted Cash and Short-Term Investments were $1,481.48 million as of March 31, 2018, compared to $837.52 million as of December 31, 2017. The increase was primarily due to net proceeds of $757.59 million raised in a public offering in January 2018. Cash, cash equivalents, restricted cash and short-term investments include approximately $131.04 million held by our 95%-owned joint venture, BeiGene Biologics, to build a commercial biologics facility under construction in Guangzhou, China. Restricted cash of $17.46 million relates to BeiGene Guangzhou Factory’s secured deposits that are held in designated bank accounts for the issuance of a letter of credit.
Cash used in operations for the quarter ended March 31, 2018 was $104.50 million, compared to $35.71 million for the same period in 2017. The increase was primarily attributable to higher operating expenses in support of our clinical programs and organizational growth. Capital expenditures for the quarter ended March 31, 2018 were $9.70 million, compared to $7.39 million for the same period in 2017. The increase was primarily attributable to the construction of our manufacturing facilities in Guangzhou.
Revenues for the three months ended March 31, 2018 were $32.54 million, compared to nil in the same period in 2017, attributable to product and collaboration revenue under our collaboration with Celgene.
Product revenue from sales of ABRAXANE, REVLIMID and VIDAZA in China totaled $23.25 million for the first quarter 2018.
Collaboration revenue totaled $9.29 million for the first quarter 2018, reflecting $7.55 million that was recognized as research and development reimbursement revenue from Celgene and $1.74 million of deferred upfront fees from Celgene recognized in the first quarter of 2018. In addition, unbilled receivables of $23.86 million on the balance sheet reflect research and development reimbursement under the Celgene collaboration for expenses incurred through the first quarter of 2018.
Expenses for the quarter ended March 31, 2018 were $143.35 million, compared to $51.54 million in the same period 2017, consisting primarily of the following:
Cost of sales for the first quarter were $4.55 million, compared to nil in the first quarter of 2017. Cost of sales relates to the cost of acquiring ABRAXANE, REVLIMID and VIDAZA for distribution in China.
R&D Expenses for the three months ended March 31, 2018 were $109.70, compared to $42.77 million in the same period in 2017. The increase in R&D expenses was primarily attributable to increased spending on our ongoing late-stage clinical trials and increased employee compensation expense as a result of increased headcount to support our clinical programs. Also contributing to the increase was the up-front license fee of $10 million paid to Mirati Therapeutics for the license of sitravatinib in Asia (excluding Japan), Australia and New Zealand. R&D-associated share-based compensation expense was $12.05 million for the three months ended March 31, 2018, compared to $4.53 million for the same period in 2017, due to increased headcount and a higher share price.
SG&A Expenses for the three months ended March 31, 2018 were $28.92 million, compared to $8.77 million in the same period in 2017. The increase in SG&A expenses was primarily attributable to increased headcount, including employees transferred from Celgene China in connection with the license agreement for Celgene’s commercial products in China, as well as higher professional service fees and costs to support our growing operations. SG&A-associated share-based compensation expense was $5.34 million for the three months ended March 31, 2018, compared to $1.46 million for the same period in 2017, due to increased headcount and a higher share price.
Net Loss for the first quarter of 2018 was $105.12 million, or $2.03 per American Depositary Share (ADS), compared to a net loss of $50.62 million, or $1.27 per ADS in the same period in 2017.