On October 31, 2024 Halozyme Therapeutics, Inc. (NASDAQ: HALO) ("Halozyme" or the "Company") reported its financial and operating results for the third quarter ended September 30, 2024, and provided an update on its recent corporate activities and outlook (Press release, Halozyme, OCT 31, 2024, View Source [SID1234647602]).

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"Our robust third quarter financial results highlight the strong execution and accelerating momentum we have across our business and exceeded expectations with total revenue growth of 34% and adjusted EBITDA growth of 60%. Based on the strong performance year-to-date, we have raised our 2024 guidance ranges and expect the advancement of our ENHANZE pipeline and new nominations from two global licensing agreements to support our future growth trajectory," said Dr. Helen Torley, president and chief executive officer of Halozyme. "In the quarter, the announcement of two highly anticipated partner approvals in the U.S. for Roche’s TECENTRIQ HYBREZA and OCREVUS ZUNOVO reinforces ENHANZE’s track record of 100% phase 3 study and subsequent regulatory success. The new nominations for ENHANZE from argenx, for a total of six targets, and ViiV Healthcare, for an additional undisclosed target, further demonstrate the value of our leading technology for rapid, large volume subcutaneous delivery."

Recent Partner Highlights:
•In October 2024, argenx initiated two studies evaluating VYVGART Hytrulo with ENHANZE, a Phase 3 study for adult patients with ocular myasthenia gravis ("oMG") and a Phase 2 study for kidney transplant recipients with antibody mediated rejection ("AMR").
•In October 2024, Janssen announced the European Commission approved DARZALEX SC for the treatment of patients newly diagnosed with multiple myeloma ("NDMM") who are eligible for autologous stem cell transplant ("ASCT") in combination with bortezomib, lenalidomide, and dexamethasone ("D-VRd").

•In September 2024, argenx expanded its global collaboration and license agreement nominating four additional targets that provides them exclusive access to our ENHANZE drug delivery technology for a total of six targets. Under the terms of the expanded exclusive agreement, we received upfront payments of $7.5 million per target nomination for a total of $30.0 million. argenx is obligated to make future milestone payments of up to $85.0 million per new nominated target, subject to achievements of specified development, regulatory and sales-based milestones. We are also entitled to receive royalties on net sales of commercialized products with our ENHANZE technology.
•In September 2024, ViiV expanded its global collaboration and license agreement providing ViiV the ability to exclusively access our ENHANZE drug delivery technology for one additional undisclosed target.
•In September 2024, Roche announced the U.S. Food and Drug Administration ("FDA") approved OCREVUS ZUNOVO with ENHANZE as a twice a year ten-minute subcutaneous ("SC") injection for the treatment of relapsing multiple sclerosis and primary progressive multiple sclerosis.
•In September 2024, Roche announced the FDA approved TECENTRIQ HYBREZA with ENHANZE for all approved adult indications of intravenous ("IV") TECENTRIQ and was made available to patients, resulting in a $12.0 million milestone payment.
•In September 2024, Janssen announced the submission of a supplemental Biologic License Application to the FDA for approval of a new indication of DARZALEX FASPRO in combination with D-VRd for the treatment of adult patients with NDMM for whom ASCT is deferred or who are ineligible for ASCT.
•In August 2024, the FDA designated Janssen’s Biologics License Application ("BLA") priority review status for amivantamab SC in combination with LAZCLUZE for currently approved or submitted indication of IV in certain patients with non-small cell lung cancer.
•In August 2024, Takeda submitted a New Drug Application in Japan seeking approval for TAK-771 with ENHANZE for treatment of chronic inflammatory demyelinating polyneuropathy/Multifocal Motor Neuropathy.
•In July 2024, Janssen announced the FDA approved DARZALEX FASPRO for an additional indication in NDMM patients who are eligible for ASCT in combination with D-VRd.
•In July 2024, argenx announced the National Medical Products Administration approved the BLA of efgartigimod SC for generalized myasthenia gravis in China.
•In July 2024, Acumen initiated a Phase 1 study of sabirnetug ("ACU193") co-formulated with ENHANZE for the treatment of early Alzheimer’s disease.

Third Quarter 2024 Financial Highlights:
•Revenue was $290.1 million, compared to $216.0 million in the third quarter of 2023. The 34% year-over-year increase was primarily driven by royalty revenue growth and an increase in milestone revenue. Revenue for the quarter included $155.1 million in royalties, an increase of 36% compared to $114.4 million in the third quarter of 2023, primarily attributable to increases in revenue of DARZALEX SC and Phesgo, and the prior year launch of VYVGART Hytrulo.
•Cost of sales was $49.4 million, compared to $54.8 million in the third quarter of 2023. The decrease was primarily due to lower device and bulk rHuPH20 sales.
•Amortization of intangibles expense was $17.8 million, compared to $20.3 million in the third quarter of 2023. The decrease was primarily due to an impairment charge of $2.5 million recognized in the prior year to fully impair the TLANDO product rights intangible asset.
•Research and development expense was $18.5 million, compared to $17.3 million in the third quarter of 2023. The increase was primarily due to increased compensation expense.

•Selling, general and administrative expense was $41.2 million, compared to $35.3 million in the third quarter of 2023. The increase was primarily due to increased compensation expense and consulting and professional service fees.
•Operating income was $163.2 million, compared to $88.3 million in the third quarter of 2023.
•Net Income was $137.0 million, compared to $81.8 million in the third quarter of 2023.
•EBITDA was $183.6 million, compared to $124.6 million in the third quarter of 2023. Adjusted EBITDA was $183.6 million, compared to $114.9 million in the third quarter of 2023.1
•GAAP diluted earnings per share was $1.05, compared to $0.61 in the third quarter of 2023. Non-GAAP diluted earnings per share was $1.27, compared to $0.75 in the third quarter of 2023.1
•Cash, cash equivalents and marketable securities were $666.3 million on September 30, 2024, compared to $336.0 million on December 31, 2023. The increase was primarily a result of cash generated from operations.

Financial Outlook for 2024
The Company is raising its financial guidance for 2024. For the full year 2024, the Company expects:

•Total revenue of $970 million to $1,020 million, representing growth of 17% to 23% over 2023 total revenue primarily driven by increases in royalty revenue, collaboration revenue and growth in product sales from XYOSTED. Revenue from royalties of $550 million to $565 million, representing growth of 23% to 26% over 2023.
•Adjusted EBITDA of $595 million to $625 million, representing growth of 40% to 47% over 2023.
•Non-GAAP diluted earnings per share of $4.00 to $4.20, representing growth of 44% to 52% over 2023. The Company’s earnings per share guidance does not consider the impact of potential future share repurchases.

Table 1. 2024 Financial Guidance

Previous Guidance Range
New Guidance Range
Total Revenue $935 to $1,015 million
$970 to $1,020 million
Royalty Revenue $520 to $555 million
$550 to $565 million
Adjusted EBITDA $555 to $615 million
$595 to $625 million
Non-GAAP Diluted EPS $3.65 to $4.05
$4.00 to $4.20

Webcast and Conference Call
Halozyme will host its Quarterly Update Conference Call for the third quarter ended September 30, 2024 today, Thursday, October 31, 2024 at 1:30 p.m. PT/4:30 p.m. ET. The conference call may be accessed live with pre-registration via link: View Source The call will also be webcast live through the "Investors" section of Halozyme’s corporate website and a recording will be made available following the close of the call. To access the webcast and additional documents related to the call, please visit Halozyme.com.