On May 5, 2021 Neurocrine Biosciences, Inc. (Nasdaq: NBIX) reported its financial results for the first quarter ended March 31, 2021 and provided revised full-year 2021 financial expense guidance (Press release, Neurocrine Biosciences, MAY 5, 2021, View Source [SID1234579183]).
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"Our first quarter results reflect a lower than normal refill rate per patient due to the typical seasonal payor dynamics for INGREZZA that were exacerbated by COVID. Importantly, we did not see an increase in discontinuations and exited the quarter with more patients on INGREZZA versus the prior quarter. New patient starts did pick up late in the quarter and we are focused on restoring INGREZZA growth as the impact of the pandemic wanes," said Kevin Gorman, Ph.D., Chief Executive Officer of Neurocrine Biosciences. "We made meaningful progress advancing our large, growing and diverse pipeline, including initiating a registrational study for the treatment of pediatric patients with congenital adrenal hyperplasia and a Phase II study in essential tremor. With important commercial products addressing patient needs and on track to initiate nine mid-to-late stage clinical studies this year, we are executing our plan to build a leading neuroscience-based company."
First Quarter Net Product Sales and Commercial Highlights:
INGREZZA net product sales for the first quarter of 2021 were $230 million and $227 million on an inventory adjusted basis
Annual seasonal payor dynamics resulted in lower refill rates per existing patient as compared to historical norms due to the COVID-19 pandemic and related disruption on timing of patient insurance reauthorizations
Exiting the first quarter, commercial activity and weekly new prescriptions both achieved their highest levels since the start of the pandemic reflecting an improved environment for diagnosis of tardive dyskinesia (TD). We expect second quarter inventory adjusted sales sequential dollar growth to be similar to 2020.
INGREZZA direct-to-consumer advertising campaign, "TD Spotlight", to be launched in May to educate patients about tardive dyskinesia and the benefits of INGREZZA
Financial Highlights:
First quarter 2021 GAAP net income and diluted earnings per share were approximately $32 million and $0.33, respectively, compared with approximately $37 million and $0.39, respectively, in the first quarter of 2020
First quarter 2021 non-GAAP net income and diluted earnings per share were approximately $48 million and $0.49, respectively, compared with approximately $79 million and $0.82, respectively, in the first quarter of 2020
Difference between first quarter 2021 GAAP and non-GAAP net income and diluted earnings per share vs. the first quarter of 2020 were driven by:
Increased Research and Development (R&D) expense primarily due to increased investment across our expanded pipeline programs and higher headcount costs
Increased Selling, General and Administrative (SG&A) expense primarily due to increased investment in commercial initiatives
At March 31, 2021, the Company had cash, cash equivalents and debt securities available-for-sale of $1.1 billion
A reconciliation of GAAP to non-GAAP financial results can be found in Table 3 and Table 4 at the end of this earnings release.
Provision for Income Taxes:
First quarter 2021 benefit from income taxes was $4.9 million, compared with a provision for income taxes of $1.5 million in the first quarter of 2020. Our effective tax rate for the first quarter of 2021 was lower than federal and state statutory rates primarily due to excess tax benefits related to stock compensation. On December 31, 2020, the Company released substantially all of its valuation allowance against its net operating losses and other deferred tax assets. Beginning in the first quarter of 2021, the Company began recording a provision for income taxes using an effective tax rate approximating federal and state statutory rates. Due to our ability to offset our pre-tax income against previously benefited federal net operating losses, no federal cash tax is expected in 2021.
Recent Events
In February 2021, the Mitsubishi Tanabe Pharma Corporation (MTPC) reported positive top-line results from the J-KINECT Phase III Study, designed to evaluate the efficacy and safety of valbenazine in tardive dyskinesia. Detailed results from this trial will be presented at a future medical conference. In April 2021, MTPC submitted a Marketing Authorization Application (MAA) with the Ministry of Health and Welfare in Japan for valbenazine for the treatment of tardive dyskinesia. MTPC submission of valbenazine triggered a milestone payment of $15 million, to be paid by MTPC to Neurocrine Biosciences and recognized as collaboration revenue in the second quarter of 2021.
In February 2021, the Company notified Voyager Therapeutics, Inc. (Voyager) of the Company’s termination of the NBIb-1817 (VY-AADC) development program in Parkinson’s disease (the Program). The Company will work to transfer the rights to the Program to Voyager by August 2, 2021.
On March 2, 2021, the Company announced that investigational drug luvadaxistat (NBI-1065844/TAK-831) did not meet its primary endpoint in the Phase II INTERACT study in adults with negative symptoms of schizophrenia. Luvadaxistat met both secondary endpoints of cognitive assessment. The Company plans to initiate a Phase II study for the treatment of cognitive impairment associated with schizophrenia (CIAS) by the end of 2021.
In April 2021, the U.S. Food and Drug Administration (FDA) approved a 60 mg INGREZZA capsule for the treatment of adults with tardive dyskinesia. The 60 mg capsule of INGREZZA is expected to be available to patients by late second quarter 2021.
Previously, the Company expected combined GAAP R&D and SG&A expenses in the range of $800 million to $850 million and combined non-GAAP R&D and SG&A expenses in the range of $675 million to $725 million
Increase to GAAP and Non-GAAP expense guidance range primarily driven by investment in INGREZZA direct-to-consumer marketing campaign, "TD Spotlight"
GAAP-only guidance includes approximately $130 million of share-based compensation. GAAP-only guidance does not include any potential milestones or in-process research and development costs associated with current collaborations or future business development activities.
Conference Call and Webcast Today at 4:30 PM Eastern Time
Neurocrine Biosciences will hold a live conference call and webcast today at 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time). Participants can access the live conference call by dialing 800-895-3361 (US) or 785-424-1062 (International) using the conference ID: NBIX. The webcast can also be accessed on Neurocrine Biosciences’ website under Investors at www.neurocrine.com. A replay of the webcast will be available on the website approximately one hour after the conclusion of the event and will be archived for approximately one month.
(Press release, Neurocrine Biosciences, MAY 5, 2021, View Source [SID1234579183])