On October 29, 2020 PTC Therapeutics, Inc. (NASDAQ: PTCT) reported financial results for the third quarter ending September 30, 2020 and provided a corporate update (Press release, PTC Therapeutics, OCT 29, 2020, View Source [SID1234569364]).

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"I am very pleased by the rapid progress that we have made this quarter with the approval and strong U.S. launch of Evrysdi for spinal muscular atrophy and the continued growth across our global Duchenne muscular dystrophy franchise," said Stuart W. Peltz, Ph.D., Chief Executive Officer, PTC Therapeutics, Inc. "We have also made significant advances across our clinical pipeline with a registration-directed trial in mitochondrial epilepsy initiated this quarter and an additional registration-directed trial in Friedreich ataxia to initiate before year end. The mission at PTC has always been to bring therapies to patients with high unmet medical need through investment in innovative technologies and we believe we are well positioned to bring long-term value for all of our stakeholders."

Key Third Quarter and Other Corporate Updates

●In August 2020, the U.S. Food and Drug Administration (FDA) approved Evrysdi (risdiplam), the first at-home, orally administered treatment for spinal muscular atrophy (SMA) in adults and children 2 months and older. In the early stages of launch, patients across a broad age range and SMA type have been treated. In October 2020, there were additional approvals in Brazil, Chile and Ukraine, further expanding the global reach of Evrysdi. Evrysdi is a product of the SMA collaboration between PTC, the SMA Foundation, and Roche.
●Also in August 2020, the European Medicines Agency (EMA) accepted the Marketing Authorization Application (MAA) filed by Roche for Evrysdi for the treatment of SMA. The EMA previously granted PRIME (PRIority MEdicines) designation to risdiplam for the treatment of SMA, providing a pathway for accelerated evaluation by the agency.
●The EMA’s acceptance of the MAA filed by Roche for Evrysdi for the treatment of SMA triggered a $15 million milestone payment to PTC and the first commercial sale of Evrysdi in the U.S. triggered a $20 million milestone payment to PTC. As a result, PTC recognized $35.0 million in collaboration revenue associated with Roche milestone events in the third quarter of 2020.
●In October 2020, Chugai Pharmaceutical, Co. Ltd, a member of the Roche group, announced that a new drug application for Evrysdi for the treatment of SMA was filed in Japan. Risdiplam received orphan drug designation from the Japan Ministry of Health, Labour and Welfare and the application is subject to a priority review. The filing in Japan triggered a $7.5 million milestone payment to PTC in the fourth quarter of 2020. Roche is executing an aggressive global regulatory strategy and now has over 20 additional applications filed for Evrysdi around the world.
●PTC has multiple aromatic L-amino acid decarboxylase (AADC) deficiency patient finding initiatives ongoing which continue to progress even amid COVID-19. PTC has expanded the number of
programs globally and in September 2020. PTC launched its newest program, PTC PINPOINT. The program offers testing at no charge to patients which can lead to an earlier diagnosis and treatment.

Third Quarter Clinical Updates

●Two-year data from Part 1 of the Evrysdi FIREFISH study were presented at the 25th International Annual Congress of the World Muscle Society (WMS). The data demonstrated that infants treated with Evrysdi continued to improve and achieve motor milestones.
●A registration-directed Phase 2/3 placebo-controlled trial to evaluate vatiquinone (PTC743) in children with mitochondrial epilepsy began enrollment in October 2020. This MIT-E trial is targeting the highly morbid and life-threatening symptom of refractory seizures in children with inherited mitochondrial disease. Vatiquinone, developed from PTC’s Bio-e platform, is an investigational oral small molecule that inhibits 15-Lipoxygenase, a key enzyme that regulates oxidative stress and inflammation response pathways that underpin neurological disease pathology including epilepsy. The FDA has granted vatiquinone orphan drug designation and pediatric rare disease designation for mitochondrial epilepsy.
●The Phase 3 vatiquinone Friedreich ataxia trial (MOVE-FA) is expected to initiate in the fourth quarter of 2020 and the Phase 3 PTC923 phenylketonuria (PKU) trial is expected to initiate in mid-2021.
●Muscle biopsies have been completed on all 20 enrolled subjects in PTC’s TranslarnaTM (ataluren) dystrophin study (Study 045). The samples from these biopsies are in the process of being analyzed and PTC expects to report top-line results in the first quarter of 2021.
●A Phase 1 study of PTC518 in healthy volunteers is expected to begin enrollment this quarter. PTC518 is another candidate from PTC’s validated splicing platform and is being developed for the treatment of Huntington disease.
●The Phase 1 single ascending dose study for PTC857 has been completed and dosing in the multiple ascending dose study is expected to be completed by the end of 2020. PTC857 was developed from the Bio-e platform with the potential to address multiple CNS disorders, with the first planned indication being glucocerebrosidase (GBA) Parkinson’s disease.
●A Phase 2/3 clinical trial for PTC299 for COVID-19 (FITE19) continues to enroll patients. PTC is expecting Stage 1 of this two-stage trial to be completed by the end of 2020 and continues to anticipate reporting top-line results from both stages in the first half of 2021. Stage 1 of this study is being conducted in the U.S., Brazil, Spain, and Australia.
●Due to COVID-19 related delays, PTC expects the EMA’s Committee for Medicinal Products for Human Use final opinion for the AADC deficiency application in the first half of 2021. PTC expects the biologics license application (BLA) for AADC deficiency to be submitted to the FDA in the first half of 2021.

Financial Highlights

●Total revenue was $118.4 million for the third quarter of 2020, compared to $71.4 million for the third quarter of 2019, a 66% year-over-year increase, Total revenue includes net product revenue of $82.7 million and collaboration and royalty revenue of $35.7 million in the third quarter of 2020.
●Total net product revenue across the commercial portfolio was $82.7 million for the third quarter of 2020, a 16% year-over-year increase.
●The Duchenne muscular dystrophy franchise continued to show strong performance in the third quarter with a 15% year-over-year increase. Emflaza continued its momentum from the second quarter of 2020 into the third quarter of 2020 driven by new patient prescriptions and ongoing
operational improvements in PTC’s commercial business. New Duchenne patients continue to be identified in Europe, LATAM and other key markets for Translarna.
●Translarna net product revenue was $43.4 million for the third quarter of 2020, compared to $48.3 million for the third quarter of 2019, a 10% year-over-year decrease. Revenue for the third quarter of 2020 was impacted by the timing of a group purchase order from Brazil, which is the primary driver for the year-over-year decrease compared to the third quarter of 2019.
●In October, PTC entered into a purchase agreement with the Brazil Ministry of Health for Translarna. The initial shipment was received by the Brazil Ministry of Health in October 2020 with the additional shipment expected in the first half of 2021.
●Emflaza net product revenue was $38.5 million for the third quarter of 2020, compared to $22.9 million for the third quarter of 2019. Growth in net product revenue was driven by new patient prescriptions and continued operational improvements and efficiencies in the commercial business.
●Roche reported initial Evrysdi August and September sales of approximately CHF 8 million. The acceptance of the MAA filed by Roche for Evrysdi for the treatment of SMA triggered a $15 million milestone payment to PTC and the first commercial sale of Evrysdi in the U.S. triggered a $20 million milestone payment to PTC. As a result, PTC recognized $35.0 million in collaboration revenue associated with Roche milestone events in the third quarter of 2020.
●Based on U.S. GAAP (Generally Accepted Accounting Principles), research and development (R&D) expenses were $93.0 million for the third quarter of 2020, compared to $63.1 million for the third quarter of 2019. The increase in R&D expenses reflects costs associated with advancing the gene therapy and Bio-e platforms, increased investment in research programs, and advancement of the clinical pipeline.
●Non-GAAP R&D expenses were $83.8 million for the third quarter of 2020, excluding $9.2 million in non-cash, stock-based compensation expense, compared to $58.1 million for the third quarter of 2019, excluding $5.0 million in non-cash, stock-based compensation expense.
●GAAP selling, general and administrative (SG&A) expenses were $57.8 million for the third quarter of 2020, compared to $49.3 million for the third quarter of 2019. The increase reflects continued investment to support PTC’s commercial activities including the expanding commercial portfolio.
●Non-GAAP SG&A expenses were $50.2 million for the third quarter of 2020, excluding $7.6 million in non-cash, stock-based compensation expense, compared to $43.8 million for the third quarter of 2019, excluding $5.5 million in non-cash, stock-based compensation expense.
●Change in the fair value of deferred and contingent consideration was $8.4 million for the third quarter of 2020, compared to $9.5 million for the third quarter of 2019. The change in fair value of deferred and contingent consideration is related to the fair valuation of potential future consideration to be paid to former equity holders of Agilis Biotherapeutics, Inc. (Agilis) in connection with PTC’s acquisition of Agilis, which closed in August 2018.
●Net loss was $69.7 million for the third quarter of 2020, compared to net loss of $60.0 million for the third quarter of 2019.
●Cash, cash equivalents and marketable securities were $1,141.0 million as of September 30, 2020, compared to $686.6 million as of December 31, 2019. The cash, cash equivalents and marketable securities balance as of September 30, 2020 includes $650.0 million in consideration received related to the July 17, 2020 Royalty Purchase Agreement between PTC and RPI 2019 Intermediate Finance Trust ("RPI").
●Shares issued and outstanding as of September 30, 2020 were 67,809,560.

Non-GAAP Financial Measures

In this press release, the financial results of PTC are provided in accordance with GAAP and using certain non-GAAP financial measures. In particular, the non-GAAP financial measures exclude non-cash, stock-based compensation expense. These non-GAAP financial measures are provided as a complement to financial measures reported in GAAP because management uses these non-GAAP financial measures when assessing and identifying operational trends. In management’s opinion, these non-GAAP financial measures are useful to investors and other users of PTC’s financial statements by providing greater transparency into the historical and projected operating performance of PTC and the company’s future outlook. Non-GAAP financial measures are not an alternative for financial measures prepared in accordance with GAAP. Quantitative reconciliations of the non-GAAP financial measures to their respective closest equivalent GAAP financial measures are included in the table below.

Conference Call and Webcast

PTC will host a conference call to discuss the third quarter of 2020 operational and financial today at 4:30 pm ET and can be access by dialing (877) 303-9216 (domestic) or (973) 935-8152 (international) five minutes prior to the start of the call and providing the passcode 7096445. A live, listen-only webcast of the conference call can be accessed on the investor relations section of the PTC website at www.ptcbio.com. A webcast replay of the call will be available approximately two hours after completion of the call and will be archived on the company’s website for 30 days following the call.