LOS ANGELES--(BUSINESS WIRE)--Puma Biotechnology, Inc. (NASDAQ: PBYI), a biopharmaceutical company,
announced financial results for the third quarter ended September 30,
2018. Unless otherwise stated, all comparisons are for the third quarter
2018 compared to the third quarter 2017.
Net product revenue in the third quarter of 2018 was $52.6 million,
compared to net product revenue of $6.1 million in the third quarter of
2017. Puma Biotechnology received approval from the U.S. Food and Drug
Administration (FDA) for NERLYNX® (neratinib) for the treatment of early
stage HER2-positive breast cancer following adjuvant trastuzumab-based
therapy on July 17, 2017, and the Company began shipment to wholesalers
at the end of July 2017.
Based on generally accepted accounting principles in the United States
(GAAP), Puma reported a net loss applicable to common stock of $14.2
million, or $0.37 per share, for the third quarter of 2018, compared to
a net loss applicable to common stock of $77.2 million, or $2.07 per
share, for the third quarter of 2017. Net loss applicable to common
stock for the first nine months of 2018 was $82.9 million, or $2.19 per
share, compared to $227.9 million, or $6.15 per share, for the first
nine months of 2017.
Non-GAAP adjusted net income was $6.6 million, or $0.17 per basic share
and $0.16 per diluted share, for the third quarter of 2018, compared to
non-GAAP adjusted net loss of $50.7 million, or $1.36 per share, for the
third quarter of 2017. Non-GAAP adjusted net loss for the first nine
months of 2018 was $14.5 million, or $0.38 per basic and diluted share,
compared to non-GAAP adjusted net loss of $144.7 million, or $3.90 per
share, for the first nine months of 2017. Non-GAAP adjusted net income
(loss) excludes stock-based compensation expense, which represents a
significant portion of overall expense and has no impact on the cash
position of the Company. For a reconciliation of GAAP net loss to
non-GAAP adjusted net income (loss) and GAAP net loss per share to
non-GAAP adjusted net income (loss) per share, please see the financial
tables at the end of this news release.
Net cash used in operating activities for the third quarter of 2018 was
$7.3 million. Net cash used in operating activities for the first nine
months of 2018 was $31.2 million. At September 30, 2018, Puma had cash
and cash equivalents of $68.3 million and marketable securities of $59.7
million, compared to cash and cash equivalents of $81.7 million at
December 31, 2017.
“The third quarter of 2018 marked the achievement of another important
milestone for Puma with the European Commission granting marketing
authorization for NERLYNX for the extended adjuvant treatment of hormone
receptor positive HER2-positive early stage breast cancer,” said Alan H.
Auerbach, Chairman, Chief Executive Officer and President of Puma. “We
expect this new medicine to be commercially available to patients in
Europe in 2019, beginning with the expected launch in Germany during the
first half of 2019 and followed by additional countries throughout
Europe in the second half of 2019.”
“We also continue to drive toward expanding availability of NERLYNX
throughout the world,” Mr. Auerbach added. “In the third quarter, our
New Drug Submission was accepted in Canada, and our licensing partner in
China, CANbridge Pharmaceutical Inc., received confirmation that the
country’s National Medical Products Administration accepted its New Drug
Application for the extended adjuvant treatment of adult patients with
early stage HER2-positive breast cancer, following adjuvant trastuzumab
based-therapy.”
Mr. Auerbach added, “We anticipate the following key milestones over the
next 12 months: (i) reporting data from the Phase III NALA trial in
third-line metastatic breast cancer patients in the fourth quarter of
2018 or first half of 2019; (ii) submitting for regulatory approval of
NERLYNX for the extended adjuvant HER2-positive early stage breast
cancer indication in additional countries in the fourth quarter of 2018
and first half of 2019; (iii) reporting additional data from the Phase
II CONTROL trial in the fourth quarter of 2018; (iv) reporting
additional data from the Phase II SUMMIT trial in the fourth quarter of
2018 or first half of 2019; and (v) meeting with the FDA in the first
quarter of 2019 to discuss the clinical development and regulatory
strategy for neratinib in HER2 mutated cancers based on the results of
the ongoing SUMMIT Phase II trial.”
Revenue
Total revenue consists of net product revenue from sales of NERLYNX,
Puma’s first and only commercial product to date, and license revenue.
For the third quarter of 2018, total revenue was $62.6 million, of which
$52.6 million was net product revenue and $10.0 million was license
revenue received from one of Puma’s sub-licensees. For the first nine
months of 2018, total revenue was $179.9 million, of which $139.4
million was net product revenue and $40.5 million was license revenue.
The FDA approved NERLYNX for commercial sale in the United States in
July 2017 and Puma commenced shipment to wholesalers in late July.
Operating Costs and Expenses
Operating costs and expenses were $73.9 million for the third quarter of
2018, compared to $83.5 million for the third quarter of 2017. Operating
costs and expenses for the first nine months of 2018 were $256.0
million, compared to $234.9 million for the first nine months of 2017.
Cost of Sales:
Cost of sales was $9.0 million for the third quarter of 2018 and $24.3
million for the first nine months of 2018, compared to $1.5 million for
the third quarter and first nine months of 2017. The Company had no
product sales prior to the third quarter of 2017.
Selling, General and Administrative Expenses:
Selling, general and administrative expenses were $28.5 million for the
third quarter of 2018, compared to $32.5 million for the third quarter
of 2017. SG&A expenses for the first nine months of 2018 were $105.2
million, compared to $75.8 million for the first nine months of
2017. The $29.4 million year-to-date increase was attributable to
increases of approximately $26.9 million in internal expenses, such as
payroll and payroll-related expenses attributable to the addition of a
salesforce since the third quarter of 2017. External expenses declined
approximately $1.5 million during the same time period and employee
stock-based compensation increased approximately $4.0 million, primarily
related to the addition of sales staff to support the commercial launch
of NERLYNX in the United States. Puma expects SG&A expenses in 2018 and
into 2019 to remain higher than in 2017 as it markets NERLYNX
commercially in the United States and launches the product in other
territories.
Research and Development Expenses:
Research and development (R&D) expenses were $36.4 million for the third
quarter of 2018, compared to $49.5 million for the third quarter of
2017. R&D expenses for the first nine months of 2018 were $126.5
million, compared to $157.5 million for the first nine months of 2017.
The $31.0 million year-to-date decrease resulted primarily from
decreases of approximately $18.9 million in stock-based compensation and
of approximately $15.4 million for external expenses related to clinical
trials, manufacturing and logistics associated with clinical supply.
Puma expects R&D expenses in 2018 to continue to decline slightly when
compared with R&D expenses in 2017 based on a decline in clinical trial
activities as existing trials continue to wind down.
About Puma Biotechnology
Puma Biotechnology, Inc. is a biopharmaceutical company with a focus on
the development and commercialization of innovative products to enhance
cancer care. Puma in-licenses the global development and
commercialization rights to three drug candidates — PB272 (neratinib,
oral), PB272 (neratinib, intravenous) and PB357. Neratinib, oral was
approved by the U.S. Food and Drug Administration in July 2017 for the
extended adjuvant treatment of adult patients with early stage
HER2-overexpressed/amplified breast cancer, following adjuvant
trastuzumab-based therapy, and is marketed in the United States as
NERLYNX® (neratinib) tablets. NERLYNX was granted marketing
authorization by the European Commission for the extended adjuvant
treatment of hormone receptor-positive HER2-positive early stage breast
cancer in September 2018. NERLYNX is a registered trademark of Puma
Biotechnology, Inc.
Further information about Puma Biotechnology may be found at www.pumabiotechnology.com.
Important Safety Information Regarding NERLYNX
®
(neratinib)
U.S. Indication
NERLYNX® (neratinib) tablets, for oral use
INDICATIONS AND USAGE: NERLYNX is a kinase inhibitor indicated
for the extended adjuvant treatment of adult patients with HER2
overexpressed/amplified breast cancer, to follow adjuvant
trastuzumab-based therapy.
CONTRAINDICATIONS: None
WARNINGS AND PRECAUTIONS:
-
Diarrhea: Aggressively manage diarrhea occurring despite
recommended prophylaxis with additional antidiarrheals, fluids, and
electrolytes as clinically indicated. Withhold NERLYNX in patients
experiencing severe and/or persistent diarrhea. Permanently
discontinue NERLYNX in patients experiencing Grade 4 diarrhea or
Grade≥ 2 diarrhea that occurs after maximal dose reduction.
-
Hepatotoxicity: Monitor liver function tests monthly for the
first 3 months of treatment, then every 3 months while on treatment
and as clinically indicated. Withhold NERLYNX in patients experiencing
Grade 3 liver abnormalities and permanently discontinue NERLYNX
inpatients experiencing Grade 4 liver abnormalities.
-
Embryo-Fetal Toxicity: NERLYNX can cause fetal harm. Advise
patients of potential risk to a fetus and to use effective
contraception.
ADVERSE REACTIONS: The most common adverse reactions (≥ 5%) were
diarrhea, nausea, abdominal pain, fatigue, vomiting, rash, stomatitis,
decreased appetite, muscle spasms, dyspepsia, AST or ALT increase, nail
disorder, dry skin, abdominal distention, epistaxis, weight decreased
and urinary tract infection.
To report SUSPECTED ADVERSE REACTIONS, contact Puma Biotechnology,
Inc. at 1-844-NERLYNX (1-844-637-5969) and
www.NERLYNX.com
or FDA at 1-800-FDA-1088 or
www.fda.gov/medwatch
.
DRUG INTERACTIONS:
-
Gastric acid reducing agents: Avoid concomitant use with proton pump
inhibitors (PPI) and H2-receptor antagonists. Separate NERLYNX by 3
hours after antacid dosing.
-
Strong or moderate CYP3A4 inhibitors: Avoid concomitant use.
-
Strong or moderate CYP3A4 inducers: Avoid concomitant use.
-
P-glycoprotein (P-gp) substrates: Monitor for adverse reactions of
narrow therapeutic agents that are P-gp substrates when used
concomitantly with NERLYNX.
USE IN SPECIFIC POPULATIONS:
-
Lactation: Advise women not to breastfeed.
Please see
Full
Prescribing Information
for additional safety information.
To help ensure patients have access to NERLYNX, Puma has implemented the
Puma Patient Lynx support program to assist patients and health care
providers with reimbursement support and referrals to resources that can
help with financial assistance. More information on the Puma Patient
Lynx program can be found at www.NERLYNX.com
or 1-855-816-5421.
The recommended dose of NERLYNX is 240 mg (six 40 mg tablets) given
orally once daily with food, continuously for one year. Antidiarrheal
prophylaxis should be initiated with the first dose of NERLYNX and
continued during the first 2 months (56 days) of treatment and as needed
thereafter.
Further information about Puma Biotechnology can be found at www.pumabiotechnology.com.
Forward-Looking Statements
This press release contains forward-looking statements, including
statements regarding the benefits of NERLYNX and neratinib, the progress
and expected timing of the Company’s clinical trials, the announcement
of data relative to those trials, and the worldwide commercialization of
NERLYNX. All forward-looking statements involve risks and uncertainties
that could cause Puma’s actual results to differ materially from the
anticipated results and expectations expressed in these forward-looking
statements. These statements are based on current expectations,
forecasts and assumptions, and actual outcomes and results could differ
materially from these statements due to a number of factors, which
include, but are not limited to, the risk factors disclosed in the
periodic and current reports filed by Puma with the Securities and
Exchange Commission from time to time, including Puma’s Annual Report on
Form 10-K for the year ended December 31, 2017. Readers are cautioned
not to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. Puma assumes no obligation to update
these forward-looking statements, except as required by law.
|
|
|
PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(in millions except share and per share data)
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
Product revenue, net
|
|
$
|
52.6
|
|
|
$
|
6.1
|
|
|
$
|
139.4
|
|
|
$
|
6.1
|
|
|
License revenue
|
|
|
10.0
|
|
|
|
—
|
|
|
|
40.5
|
|
|
|
—
|
|
|
Total revenue
|
|
|
62.6
|
|
|
|
6.1
|
|
|
|
179.9
|
|
|
|
6.1
|
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
|
9.0
|
|
|
|
1.5
|
|
|
|
24.3
|
|
|
|
1.5
|
|
|
Selling, general and administrative
|
|
|
28.5
|
|
|
|
32.5
|
|
|
|
105.2
|
|
|
|
75.8
|
|
|
Research and development
|
|
|
36.4
|
|
|
|
49.5
|
|
|
|
126.5
|
|
|
|
157.6
|
|
|
Totals
|
|
|
73.9
|
|
|
|
83.5
|
|
|
|
256.0
|
|
|
|
234.9
|
|
|
Loss from operations
|
|
|
(11.3
|
)
|
|
|
(77.4
|
)
|
|
|
(76.1
|
)
|
|
|
(228.8
|
)
|
|
Other income (expenses):
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
0.6
|
|
|
|
0.3
|
|
|
|
1.1
|
|
|
|
1.0
|
|
|
Interest expense
|
|
|
(3.5
|
)
|
|
|
—
|
|
|
|
(7.2
|
)
|
|
|
—
|
|
|
Other expense
|
|
|
-
|
|
|
|
(0.1
|
)
|
|
|
(0.7
|
)
|
|
|
(0.1
|
)
|
|
Totals
|
|
|
(2.9
|
)
|
|
|
0.2
|
|
|
|
(6.8
|
)
|
|
|
0.9
|
|
|
Net loss
|
|
$
|
(14.2
|
)
|
|
$
|
(77.2
|
)
|
|
$
|
(82.9
|
)
|
|
$
|
(227.9
|
)
|
|
Net loss per common share—basic and diluted
|
|
$
|
(0.37
|
)
|
|
$
|
(2.07
|
)
|
|
$
|
(2.19
|
)
|
|
$
|
(6.15
|
)
|
|
Weighted-average common shares outstanding—basic and diluted
|
|
|
38,043,174
|
|
|
|
37,214,002
|
|
|
|
37,855,249
|
|
|
|
37,046,765
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY
|
|
LIQUIDITY AND CAPITAL RESOURCES
|
|
(in millions, unaudited)
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
|
|
2018
|
|
2017
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
68.3
|
|
|
$
|
81.7
|
|
|
Marketable securities
|
|
|
59.7
|
|
|
|
—
|
|
|
Working capital
|
|
|
116.5
|
|
|
|
48.1
|
|
|
Stockholders' equity
|
|
|
45.9
|
|
|
|
53.3
|
|
|
|
|
|
|
|
|
|
|
Nine Months
|
|
Nine Months
|
|
|
|
Ended
|
|
Ended
|
|
|
|
September 30,
|
|
September 30,
|
|
|
|
2018
|
|
2017
|
|
Cash provided by (used in):
|
|
|
|
|
|
Operating activities
|
|
$
|
(31.2
|
)
|
|
$
|
(136.9
|
)
|
|
Investing activities
|
|
|
(60.2
|
)
|
|
|
8.1
|
|
|
Financing activities
|
|
|
78.0
|
|
|
|
14.0
|
|
|
|
|
|
|
|
|
Decrease in cash and cash equivalents, and restricted cash
|
|
$
|
(13.4
|
)
|
|
$
|
(114.8
|
)
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
In addition to operating results as calculated in accordance with GAAP,
the Company uses certain non-GAAP financial measures when planning,
monitoring, and evaluating operational performance. The following table
presents the Company’s net loss and net loss per share calculated in
accordance with GAAP and as adjusted to remove the impact of employee
stock-based compensation. For the three and nine months ended September
30, 2018, stock-based compensation represented approximately 32.0% and
29.5% of operating expense (which does not include cost of sales),
respectively. Although net loss is important to measure financial
performance, the Company currently places an emphasis on cash burn and,
more specifically, cash used in operations. Stock-based compensation
appears in GAAP net loss but is removed from net loss to arrive at cash
used in operations on the statement of cash flows. Due to its noncash
nature, the Company believes these non-GAAP measures enhance
understanding of financial performance, are more indicative of
operational performance and facilitate a better comparison among fiscal
periods. These non-GAAP financial measures are not, and should not be
viewed as, substitutes for GAAP reporting measures.
|
|
|
PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY
|
|
Reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Income
(Loss) and
|
|
GAAP Net Loss Per Share to Non-GAAP Adjusted Net Income (Loss)
Per Share
|
|
(in millions except share and per share data)
|
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
GAAP net loss
|
|
$
|
(14.2
|
)
|
|
|
|
$
|
(77.2
|
)
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Stock-based compensation -
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative
|
|
|
9.4
|
|
|
|
|
|
8.3
|
|
|
(1
|
)
|
|
Research and development
|
|
|
11.4
|
|
|
|
|
|
18.2
|
|
|
(2
|
)
|
|
Non-GAAP adjusted net income (loss)
|
|
$
|
6.6
|
|
|
|
|
$
|
(50.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss per share - basic
|
|
$
|
(0.37
|
)
|
|
|
|
$
|
(2.07
|
)
|
|
|
|
Adjustment to net income (loss) (as detailed above)
|
|
|
0.54
|
|
|
|
|
|
0.71
|
|
|
|
|
Non-GAAP adjusted net income (loss) per share
|
|
$
|
0.17
|
|
|
|
|
$
|
(1.36
|
)
|
|
(3
|
)
|
|
GAAP net loss per share—diluted
|
|
$
|
(0.36
|
)
|
|
|
|
$
|
(2.07
|
)
|
|
|
|
Adjustment to net loss (as detailed above)
|
|
|
0.52
|
|
|
|
|
|
0.71
|
|
|
|
|
Non-GAAP adjusted diluted net income (loss) per share
|
|
$
|
0.16
|
|
|
(4
|
)
|
|
$
|
(1.36
|
)
|
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|
2018
|
|
|
|
2017
|
|
|
|
GAAP net loss
|
|
$
|
(82.9
|
)
|
|
|
|
$
|
(227.9
|
)
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Stock-based compensation -
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative
|
|
|
27.0
|
|
|
|
|
|
23.0
|
|
|
(1
|
)
|
|
Research and development
|
|
|
41.4
|
|
|
|
|
|
60.2
|
|
|
(2
|
)
|
|
Non-GAAP adjusted net loss
|
|
$
|
(14.5
|
)
|
|
|
|
$
|
(144.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss per share - basic and diluted
|
|
$
|
(2.19
|
)
|
|
|
|
$
|
(6.15
|
)
|
|
|
|
Adjustment to net loss (as detailed above)
|
|
|
1.81
|
|
|
|
|
|
2.25
|
|
|
|
|
Non-GAAP adjusted net loss per share
|
|
$
|
(0.38
|
)
|
|
|
|
$
|
(3.90
|
)
|
|
(6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
To reflect a non-cash charge to operating expense for Selling,
General and Administrative stock-based compensation.
|
|
(2)
|
|
To reflect a non-cash charge to operating expense for Research and
Development stock-based compensation.
|
|
(3)
|
|
Non-GAAP adjusted net income (loss) per share was calculated based
on 38,043,174 and 37,214,002 weighted average common shares
outstanding for the three months ended September 30, 2018 and
2017, respectively.
|
|
(4)
|
|
Non-GAAP adjusted diluted net income per share was calculated
based on 39,677,446 weighted average common shares outstanding and
potentially dilutive common stock equivalents (stock options,
restricted stock units and warrants) for the three months ended
September 30, 2018.
|
|
(5)
|
|
Potentially dilutive common stock equivalents (stock options,
restricted stock units and warrants) were not included in this
non-GAAP adjusted diluted net loss per share for the three months
ended September 30, 2017 as these shares would be considered
anti-dilutive.
|
|
(6)
|
|
Non-GAAP adjusted net loss per share was calculated based on
37,855,249 and 37,046,765 weighted average common shares
outstanding for the nine months ended September 30, 2018 and 2017,
respectively.
|
|
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