On November 5, 2020 Coherus BioSciences, Inc. ("Coherus" or the "Company", Nasdaq: CHRS), reported financial results for the third quarter and nine months ended September 30, 2020 (Press release, Coherus Biosciences, NOV 5, 2020, View Source [SID1234570050]).

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"In September, Coherus celebrated its ten year anniversary, and I am thrilled by what we have accomplished at this milestone," said Denny Lanfear, Coherus President and CEO. "Coherus is fully integrated with competencies in research, development, and commercialization, and we are successfully fulfilling our mission to deliver value to patients by providing them access to cost effective drugs that can have a major impact on their lives. Moreover, our Udenyca business is generating significant cash flow, enabling investments in our pipeline of product candidates which, if approved, would expand our addressable market opportunity from $4 billion to $30 billion."

Third Quarter 2020 and Recent Corporate Highlights

Net product revenue for the third quarter of 2020 was $113.6 million, and net income was $27.9 million, or $0.33 per share on a diluted basis.
Non-GAAP income during the third quarter of 2020 was $39.7 million, or $0.47 per share on a diluted basis.
Cash flow from operating activities was $47.4 million for the third quarter of 2020.
Third Quarter 2020 Financial Results

Net product revenue for the third quarter of 2020 was $113.6 million. Cost of goods sold for the third quarter of 2020 was $9.0 million, resulting in a gross profit margin of 92%.

Research and development (R&D) expense for the third quarter of 2020 was $38.9 million, as compared to $21.6 million for the same period in 2019. R&D expense for the nine months ended September 30, 2020 was $98.1 million, as compared to $59.2 million for the same period in 2019. The increase in R&D expense in both periods was primarily due to preparations for the biologics license application (BLA) filing of CHS-1420, Coherus’ biosimilar to Humira (adalimumab), as well as other pipeline activities.

Selling, general and administrative (SG&A) expense for the third quarter of 2020 was $32.0 million, as compared to $31.8 million for the same period in 2019. SG&A expense for the nine months ended September 30, 2020 was $101.4 million, as compared to $101.0 million for the same period in 2019.

Cash, cash equivalents and investments in marketable securities for the third quarter increased to $503.4 as of September 30, 2020, as compared to $456.5 million as of June 30, 2020 and $177.7 million as of December 31, 2019. The increase in the third quarter of 2020 is primarily due to generating $47.4 million in net cash from operating activities.

Net income for the third quarter of 2020 was a $27.9 million, or $0.33 per share on a diluted basis, compared to $47.0 million, or $0.63 per share on a diluted basis for the same period in 2019.

Non-GAAP net income for the third quarter of 2020 was $39.7 million, or $0.47 per share on a diluted basis, compared to non-GAAP income of $55.7 million, or $0.74 per share on a diluted basis for the same period in 2019. See "Non-GAAP Financial Measures" below for a discussion on how the Company calculates non-GAAP net income and a reconciliation to the most directly comparable GAAP measures.

Guidance for the Next Twelve Months from September 30, 2020

Coherus will continue to lay the foundation for long-term growth across its three therapeutic areas:

Oncology

Deliver continued unit share growth with UDENYCA against all Neulasta dosage forms, while maintaining average selling price ("ASP") discipline, leveraging the validated branded-biosimilar strategy of offering a robust value proposition across all key customer segments.
Advance the Company’s biosimilar candidate to Avastin (bevacizumab) in-licensed from Innovent toward an expected 351(k) BLA submission with the U.S. FDA in 2021, depending on the outcome of the three-way pharmacokinetic ("PK") study, the timing of required interactions with the FDA, as well as completion of analytical similarity exercises.
Ophthalmology

Facilitate Bioeq’s resubmission of a 351(k) BLA with the FDA for the biosimilar candidate to Lucentis (ranibizumab) in 2021.
Advance the Company’s internally developed CHS-2020 biosimilar candidate to Eylea (aflibercept) to a projected Phase 3 clinical trial initiation in 2021, with launch projected in 2025, if approved.
Immunology

Submit the 351(k) BLA for the Company’s internally developed Humira (adalimumab) biosimilar, CHS-1420, by year end 2020, consistent with prior guidance, and continue other activities to advance toward a projected market entry in the United States on or after July 1, 2023, if approved.
Financial Guidance

R&D and SG&A expenses combined for the full fiscal year 2020 are expected to come in at the low end of the previously stated range of $285 million to $310 million, excluding upfront or milestone payments from any potential new collaborations.
Conference Call Information

When: Thursday, November 5, 2020 starting at 4:30 p.m. ET

Webcast: at View Source

The conference call will be broadcast live in listen-only mode on the Company’s investor relations website at View Source If you would like to ask a question, the dial in number for the conference call is 844-452-6826 (Toll-Free U.S. and Canada) or 765-507-2587 (International).

Conference ID: 7079429

Please dial-in 15 minutes early to ensure a timely connection to the call.

Third quarter 2020 financial results are posted on the Coherus website at View Source The webcast will be archived on the Coherus website.