On May 5, 2022 Coherus BioSciences, Inc. ("Coherus" or the "Company", Nasdaq: CHRS), reported financial results for the quarter ended March 31, 2022 and recent business highlights (Press release, Coherus Biosciences, MAY 5, 2022, View Source [SID1234613649]):
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
RECENT BUSINESS HIGHLIGHTS
After receiving a complete response letter ("CRL") for the Biologics License Application ("BLA") for toripalimab, Coherus and partner Shanghai Junshi Biosciences Co., Ltd. ("Junshi Biosciences") plan to resubmit the toripalimab BLA by mid-summer with an expected six month review by the United States Food and Drug Administration ("FDA"). The CRL requests a quality process change that Coherus and Junshi Biosciences believe is readily addressable.
The FDA review of the BLA for CIMERLI (ranibizumab-ranq), a Lucentis biosimilar, is advancing toward the target action date of August 2, 2022.
The FDA granted Orphan Drug Designation for toripalimab for the treatment of small cell lung cancer.
Two proprietary immuno-oncology research programs have advanced to preclinical development: CHS-1000, an ILT4-targeted antibody, and CHS-3318, a CCR8-targeted antibody. Coherus expects to file an investigational new drug application ("IND") for CHS-1000 in 2023.
Positive toripalimab clinical data were presented and published:
Final progression-free survival ("PFS") and interim overall survival ("OS") data from the JUPITER-02 trial evaluating toripalimab plus chemotherapy for advanced nasopharyngeal carcinoma were presented at the annual meeting of the American Association for Cancer Research (AACR) (Free AACR Whitepaper) in April.
Final PFS and interim OS data from the CHOICE-01 trial evaluating toripalimab plus chemotherapy for non-small cell lung cancer were presented at the March ASCO (Free ASCO Whitepaper) Plenary Series.
Final PFS and interim OS data from the JUPITER-06 trial evaluating toripalimab plus chemotherapy for first-line treatment of esophageal squamous cell carcinoma were published in the March issue of Cancer Cell.
Coherus has discontinued development of CHS-305 ("IBI-305"), an Avastin biosimilar candidate, and is returning IBI-305 rights to Innovent Biologics (Suzhou) Co., Ltd.
Coherus is lowering by $20 million the projected range for combined full year 2022 R&D and SG&A expenses. See "2022 R&D and SG&A Expense Guidance" section below.
"As we prepare for as many as four new product launches in 2022 and 2023, we continue to make strong progress transforming Coherus into an innovative immuno-oncology company supported by revenues generated by our diversified commercial portfolio of FDA-approved products," said Denny Lanfear, Coherus’ CEO. "Following the recent late-cycle review meeting with the FDA, we are finalizing our preparations to launch CIMERLI later this year, if approved, into the $7 billion anti-VEGF ophthalmology market in the United States. We expect to resubmit the toripalimab BLA by mid-summer and are preparing for the commercial launch directly upon approval. We continue to invest significantly in YUSIMRY ahead of the planned launch in July 2023, as robust supply availability is a key part of our market strategy. Our UDENYCA business continues to provide strong funding for our operations, and we look forward to the potential launch next year of our on-body injector presentation which, if approved, would allow us to compete directly with Neulasta Onpro, a greater than $1 billion market opportunity."
FIRST QUARTER 2022 FINANCIAL RESULTS
Net revenue, consisting of net sales of UDENYCA, was $60.1 million and $83.0 million during the three months ended March 31, 2022 and 2021, respectively. The decline was primarily due to a decrease in the number of units of UDENYCA sold as well as a lower net realized price due to increased competition.
Cost of goods sold (COGS) was $9.4 million and $7.5 million during the three months ended March 31, 2022 and 2021, respectively. Until the first quarter of 2021, Coherus sold inventory that was manufactured and expensed prior to the approval of UDENYCA in late 2018. This inventory was depleted in the first quarter of 2021, and since then, COGS fully reflects per unit acquisition cost. UDENYCA COGS also includes a mid-single digit royalty on net sales payable through the first half of 2024.
Research and development (R&D) expense for the three months ended March 31, 2022 was $82.9 million and included a $35 million option exercise fee to Junshi Biosciences to license CHS-006, a clinical stage TIGIT-targeted antibody, as well as development and manufacturing costs for clinical and preclinical pipeline programs. For the same period in 2021, R&D expense was $203.5 million and included a $145 million upfront fee paid to Junshi Biosciences for the license to rights to toripalimab for the United States and Canada, $11.5 million in costs related to the discontinuation of the CHS-2020 (Eylea biosimilar) program, as well as development costs for clinical and preclinical pipeline programs.
Selling, general and administrative (SG&A) expense for the three months ended March 31, 2022 was $48.8 million compared to $39.4 million for the same period in 2021. The increase was primarily driven by higher commercialization expenses to support current UDENYCA sales and in preparation for multiple anticipated new product launches in 2022 and 2023, including CIMERLI, toripalimab, YUSIMRY, and the on-body injector presentation of UDENYCA.
Net loss for the first quarter of 2022 was $96.1 million, or $(1.24) per share on a diluted basis, compared to a net loss of $172.9 million, or $(2.37) per share on a diluted basis for the same period in 2021.
Non-GAAP net loss for the first quarter of 2022 was $77.0 million, or $(1.00) per share on a diluted basis, compared to non-GAAP net loss of $144.6 million, or $(1.98) per share on a diluted basis for the same period in 2021. Beginning in the first quarter of 2022, the Company no longer regularly excludes upfront and milestone based license fee payments from its non-GAAP financial information. To conform to this change, the prior period non-GAAP financial information has been recast to include upfront and milestone based license fee payments. See "Non-GAAP Financial Measures" below for a discussion on how Coherus calculates non-GAAP net loss and a reconciliation to the most directly comparable GAAP measures.
Cash, cash equivalents and investments in marketable securities were $325.7 million as of March 31, 2022, compared to $417.2 million at December 31, 2021.
2022 R&D and SG&A Expense Guidance
As a result of the discontinuation of the CHS-305 development program and the delay of the toripalimab commercial launch, Coherus is lowering the projected range for combined full year 2022 R&D and SG&A expenses by $20 million to $395 million to $430 million. This range includes $55 million to $60 million of stock-based compensation expense and excludes the $35 million license fee paid in the first quarter of 2022 for CHS-006 as well as a potential $25 million milestone payable upon FDA approval of the toripalimab BLA for nasopharyngeal carcinoma. This financial guidance also excludes the effects of any potential future strategic acquisitions, collaborations or investments, the exercise of rights or options related to collaboration programs, and any other transactions or circumstances not yet identified or quantified. This guidance is subject to a number of risks and uncertainties. See Forward-Looking Statements described in the section below.