— Full year product revenue of $9.87 billion,
an 11% increase compared to full year 2022 —
— Company provides full year 2024 product
revenue guidance of $10.55 to $10.75 billion —
— CASGEVYTM approved in the U.S., Great
Britain, the Kingdom of Saudi Arabia and Bahrain —
— Vertex on track to submit new drug
applications (NDAs) to the FDA by mid-2024 for both VX-548 in Acute
Pain and the Vanzacaftor Triple in CF —
— Broad and deep clinical-stage pipeline
continues to advance across 10 disease areas —
Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX) today
reported consolidated financial results for the fourth quarter and
full year ended December 31, 2023 and provided full year 2024
financial guidance.
“2023 was a transformative year for Vertex as we continued our
strong performance, including 11% revenue growth, combined with
significant advancement across the business. We expanded our
leadership in CF, diversified our commercial opportunity with
CASGEVY regulatory approvals in multiple regions, and rapidly
advanced a broad pipeline with multiple additional near-term
potential launch opportunities in disease areas outside of CF,”
said Reshma Kewalramani, M.D., Chief Executive Officer and
President of Vertex. “Our progress in 2023 lays the foundation for
the anticipated regulatory submissions for the vanzacaftor triple
and VX-548 by mid-2024 and sets us on a path to expand our business
in CF and beyond, beginning with the commercialization of CASGEVY
in multiple geographies.”
Fourth Quarter 2023
Results
Product revenue increased 9% to $2.52 billion compared to
the fourth quarter of 2022, primarily driven in the U.S. by the
continued performance of TRIKAFTA, including the uptake in children
with CF 2 to 5 years of age, and in ex-U.S. markets by the
continued strong uptake of TRIKAFTA/KAFTRIO, including label
extensions in younger age groups. Net product revenue in the fourth
quarter of 2023 increased 8% to $1.57 billion in the U.S. and
increased 12% to $943 million outside the U.S., compared to the
fourth quarter of 2022.
Combined GAAP and Non-GAAP R&D, Acquired IPR&D and
SG&A expenses were $1.2 billion and $1.0 billion,
respectively, compared to $984 million and $872 million,
respectively, in the fourth quarter of 2022. The increases were due
to increased investment in support of multiple programs that have
advanced in mid- and late-stage clinical development and the costs
to support launches of Vertex's therapies globally. Combined GAAP
R&D, Acquired IPR&D and SG&A expenses also included
increased stock-based compensation expense compared to the fourth
quarter of 2022.
GAAP effective tax rate was 15.6% compared to 24.0% for
the fourth quarter of 2022 based on increased benefits from R&D
tax credits and a lower provision from uncertain tax positions.
Non-GAAP effective tax rate was 16.3% compared to 18.5%
for the fourth quarter of 2022 as a result of increased benefits
from R&D tax credits for the current year. Please refer to Note
1 for further details on our GAAP to Non-GAAP tax adjustments.
GAAP and Non-GAAP net income increased by 18% and 12%,
respectively, compared to the fourth quarter of 2022, primarily due
to higher interest income and lower taxes.
Full Year 2023 Results
Product revenue increased 11% to $9.87 billion compared
to 2022, primarily driven by the continued strong uptake of
TRIKAFTA/KAFTRIO in ex-U.S. markets, including label extensions in
younger age groups, and the continued performance of TRIKAFTA in
the U.S, including the ongoing launch in children with CF 2 to 5
years of age. Net product revenue in 2023 increased 6% to $6.04
billion in the U.S. and increased 18% to $3.83 billion outside the
U.S., compared to 2022.
Combined GAAP and Non-GAAP R&D, Acquired IPR&D and
SG&A expenses were $4.83 billion and $4.24 billion,
respectively, compared to $3.60 billion and $3.07 billion,
respectively, in 2022. The increases were due to increased
investment in support of multiple programs that have advanced in
mid- and late-stage clinical development, the costs to support
launches of Vertex's therapies globally, and increased acquired
IPR&D expenses.
GAAP effective tax rate was 17.4% compared to 21.5% in
2022, largely as a result of higher U.S. R&D tax credits for
the current and prior years.
Non-GAAP effective tax rate was 19.4% compared to 20.8%
in 2022, also largely as a result of higher U.S. R&D tax
credits for the current year. Please refer to Note 1 for further
details on our GAAP to Non-GAAP tax adjustments.
GAAP and Non-GAAP net income increased by 9% and 3%,
respectively, compared to 2022, primarily due to higher interest
income and lower taxes.
Cash, cash equivalents and total marketable securities as
of December 31, 2023 were $13.7 billion, compared to $10.9 billion
as of December 31, 2022. The increase was primarily due to income
from operations that was driven by strong revenue growth, and
interest income, partially offset by income tax payments and
repurchases of our common stock pursuant to our share repurchase
program.
Full Year 2024 Financial
Guidance
Vertex today provided full year 2024 financial guidance.
Vertex’s product revenue guidance of $10.55 billion to $10.75
billion includes expectations for continued growth in CF as well as
the launch of CASGEVY in approved indications and geographies.
Vertex’s combined Non-GAAP R&D, Acquired IPR&D and SG&A
expense guidance of $4.3 billion to $4.4 billion includes
expectations for continued investment in our multiple mid and
late-stage clinical development programs, commercial and
manufacturing capabilities, and approximately $125 million of
upfront and milestone payments.
Vertex’s financial guidance is summarized below:
FY 2024
Total product revenues
$10.55 to $10.75 billion
Combined GAAP R&D, Acquired
IPR&D and SG&A expenses (2)
$4.9 to $5.1 billion
Combined Non-GAAP R&D, Acquired
IPR&D and SG&A expenses (2)
$4.3 to $4.4 billion
Non-GAAP effective tax rate
20% to 21%
Key Business Highlights
Marketed Products
Cystic Fibrosis (CF)
Portfolio
Vertex anticipates the number of CF patients taking our
medicines will continue to grow, including through new approvals
and reimbursement for the treatment of younger patients. Recent and
anticipated progress includes:
- Updated estimates for the number of patients living with CF
from ~88,000 to ~92,000 in the U.S., Europe, Australia, and
Canada.
- The European Commission granted approval in the fourth quarter
of 2023 for label extension of KAFTRIO in combination with
ivacaftor in children with CF 2 to 5 years of age who have at least
one F508del mutation in the CFTR gene. With this approval,
approximately 1,200 children are newly eligible for a medicine that
could treat the underlying cause of their disease. Vertex will
continue to work with reimbursement authorities across the European
Union to ensure access for all eligible patients.
- In the U.K., the Medicines and Healthcare Products Regulatory
Agency (MHRA) approved the use of KAFTRIO in children with CF 2 to
5 years of age who have at least one F508del mutation in the CFTR
gene. With this approval, approximately 200 children are newly
eligible for a medicine that could treat the underlying cause of
their disease. Because of the existing reimbursement agreement
between Vertex and the National Health Service, children ages 2
years of age and above in the U.K. already have access to
KAFTRIO.
- The European Medicines Agency (EMA) validated the Marketing
Authorization Application (MAA) extension for KAFTRIO in
combination with ivacaftor to include people with CF who have a
rare mutation in the cystic fibrosis transmembrane conductance
regulator (CFTR) gene that is responsive based on clinical and/or
in vitro data, including the N1303K mutation. If approved,
approximately 2,800 people with CF in the European Union ages 2
years of age and above would be newly eligible for treatment.
Vertex plans to submit regulatory filings for the same mutations in
Australia, Brazil, Canada, New Zealand and Switzerland. Vertex also
plans to submit a subset of these mutations, including N1303K and
non-canonical splice mutations, not currently included in the U.S.
TRIKAFTA label to the U.S. FDA.
Sickle cell disease (SCD) and
transfusion-dependent beta thalassemia (TDT):
CASGEVY
- Vertex received regulatory approvals for CASGEVY in the U.S.,
Great Britain, Bahrain, and the Kingdom of Saudi Arabia (KSA) for
the treatment of both SCD and TDT.
- Vertex also received a positive opinion for CASGEVY for the
treatment of both SCD and TDT from the EMA’s Committee for
Medicinal Products for Human Use (CHMP).
- The French National Authority for Health (HAS) approved
Vertex’s request for the implementation of an early access program
(EAP) for the use of CASGEVY to treat people with
transfusion-dependent beta thalassemia (TDT) from 12-35 years of
age for whom hematopoietic stem cell (HSC) transplantation is
appropriate and a human leukocyte antigen (HLA)-matched related HSC
donor is not available. Vertex is also pursuing an EAP submission
for SCD in France and expects to hear the outcome of this decision
in the coming months.
- The regulatory submission for CASGEVY in both SCD and TDT is
currently under review in Switzerland, with submission in Canada
planned for the first half of 2024.
- Vertex updated estimates for the number of patients living with
severe SCD, from ~25,000 patients to ~30,000 patients in the U.S.
and Europe, with additional patients in KSA and Bahrain. Vertex
also updated estimates for patients with TDT, from ~7,000 to ~5,000
patients in the U.S. and Europe, with additional patients in KSA
and Bahrain.
- Vertex has activated 12 authorized treatment centers (ATCs) in
the U.S. and three in the EU, with the ultimate goal of activating
approximately 50 ATCs in the U.S. and 25 in Europe. Vertex has also
activated one of two planned ATCs in KSA.
- Vertex recently signed an agreement with Synergie Medication
Collective, a medication contracting organization founded by a
group of Blue Cross and Blue Shield affiliated companies covering
approximately 100 million people in the U.S., to provide access to
CASGEVY.
- On January 30th, the Biden Administration, in partnership with
Centers for Medicare and Medicaid Services (CMS) and the Department
of Health and Human Services (HHS), announced the details of the
Center for Medicare and Medicaid Innovation Cell and Gene Therapy
(CGT) Access Demonstration Model. The demonstration model is
structured as a voluntary negotiation with CMS to devise
multi-state outcomes-based arrangements (OBAs) for SCD cell and
genetic therapies that state Medicaid programs can participate in
beginning in January 2025. In the meantime, Vertex is actively
engaging with Medicaid states to secure immediate reimbursement and
coverage for CASGEVY and believes the CGT Access Model may provide
an additional important tool to help address longstanding
inequities in care by facilitating access and funding for
potentially curative therapies for the sickle cell community.
Potential Near-Term Launch
Opportunities
Vertex is preparing for the following near-term potential new
product launches:
- Vanzacaftor/tezacaftor/deutivacaftor, the next-in-class
triple oral small molecule combination, in cystic fibrosis
- In the fourth quarter, Vertex completed three pivotal studies
evaluating the efficacy and safety of
vanzacaftor/tezacaftor/deutivacaftor ("the vanza triple") relative
to TRIKAFTA in people with CF ages 6 years of age and older (ages
12+ in SKYLINE 102 and 103 studies; ages 6-11 in the RIDGELINE
study).
- Vertex today shared positive data from the three pivotal
studies for the vanza triple, showing that the studies met the
primary endpoint and all key secondary endpoints. Based on these
data, Vertex intends to submit global regulatory filings by
mid-2024 for the vanza triple, including a New Drug Application
(NDA) to the U.S. FDA using a priority review voucher and MAAs to
the EMA and Health Canada, for people with CF 6 years of age and
older.
- VX-548 for the treatment of moderate to severe acute
pain: Vertex has discovered multiple selective small molecule
inhibitors of NaV1.8 with the objective of creating a new class of
pain medicines that have the potential to provide effective pain
relief across a variety of pain states, without the limitations of
opioids and other currently available medicines.
- In the fourth quarter of 2023, Vertex completed the pivotal
program, which includes three Phase 3 trials: one randomized,
controlled trial in abdominoplasty; one randomized, controlled
trial in bunionectomy; and a single-arm safety and effectiveness
trial.
- Vertex recently shared positive results from the three Phase 3
trials of VX-548 in acute pain. Based on these data, Vertex plans
to submit an NDA for the treatment of moderate to severe acute pain
to the U.S. FDA by mid-2024. VX-548 has Fast Track and Breakthrough
Therapy designations in acute pain.
Select Clinical-Stage R&D
Pipeline
Vertex is delivering on a diversified pipeline of potentially
transformative medicines for serious diseases utilizing a range of
modalities. Recent and anticipated progress for select programs in
clinical development is summarized below.
Cystic Fibrosis
Vertex continues to pursue a nebulized mRNA therapy for the more
than 5,000 patients who do not make CFTR protein and cannot benefit
from CFTR modulators, as well as next-in-class, small molecule,
oral CFTR modulators.
- Vertex completed dosing in the single ascending dose (SAD)
portion of the Phase 1/2 study of VX-522 in people with CF.
- Vertex initiated the multiple ascending dose (MAD) portion of
the study; screening, enrollment and dosing are underway. Vertex
expects to share data from this study in late 2024 or early
2025.
Sickle Cell Disease and Beta Thalassemia
- Vertex completed enrollment in two global Phase 3 studies of
CASGEVY in people 5 to 11 years of age with SCD or TDT.
- Additionally, Vertex continues to work on preclinical assets
for gentler conditioning for CASGEVY, which could broaden the
eligible patient population to more than 150,000 people.
Peripheral Neuropathic Pain (PNP)
- In December 2023, Vertex shared positive Phase 2 results with
VX-548 in diabetic peripheral neuropathy, a condition that affects
~2 million Americans.
- Vertex will meet with regulators in the first quarter of 2024
and anticipates advancing VX-548 into pivotal development
thereafter.
- Vertex initiated a Phase 2 study of VX-548 in lumbosacral
radiculopathy (LSR), another type of peripheral neuropathic pain
and the largest patient segment (over 40%) within the PNP category
with high unmet need and no approved therapies. Screening,
enrollment and dosing are underway.
- Vertex anticipates initiating a Phase 2 study with an oral
formulation of VX-993, a next-generation selective NaV1.8
inhibitor, for the treatment of PNP in 2024.
Acute Pain
- Vertex also anticipates initiating a Phase 2 study with an oral
formulation of VX-993, a next-generation NaV1.8 inhibitor, for the
treatment of moderate to severe acute pain in of 2024.
- Vertex anticipates completing IND-enabling studies and filing
an IND for an intravenous formulation of VX-993 in 2024.
- Consistent with its commitment to serial innovation and
leadership in pain, Vertex also continues to develop NaV1.7
inhibitors, both for stand-alone use and in combination with NaV1.8
inhibitors, for both acute and peripheral neuropathic pain.
APOL1-Mediated Kidney Disease (AMKD)
Vertex has discovered and advanced multiple oral, small molecule
inhibitors of APOL1 function, pioneering a new class of medicines
that target an underlying genetic driver of kidney disease.
- Vertex completed enrollment in the Phase 2B dose-ranging
portion of the pivotal program for inaxaplin, a single Phase 2/3
clinical trial in patients with AMKD.
- Vertex expects to select a dose for the Phase 3 portion and
begin Phase 3 in the first quarter of 2024.
Type 1 Diabetes (T1D)
Vertex is evaluating cell therapies using stem cell-derived,
fully differentiated, insulin-producing islet cells to replace the
endogenous insulin-producing islet cells that are destroyed in
people with T1D, with the goal of developing a potential one-time
functional cure for this disease.
- VX-880, fully differentiated islet cells with standard
immunosuppression:
- Completed enrollment in Parts A, B, and C of the Phase 1/2
study of VX-880, an allogeneic, stem cell-derived, fully
differentiated, insulin-producing islet cell therapy, used in
conjunction with standard immunosuppression, in people with T1D and
impaired awareness of hypoglycemia and recurrent hypoglycemic
events.
- Vertex has placed the study on a protocol-specified pause,
pending review of the totality of the data by the independent data
monitoring committee and global regulators.
- VX-264, fully differentiated islet cells encapsulated in an
immunoprotective device:
- The clinical trial for VX-264, which encapsulates the same
VX-880 cells in a novel device designed to eliminate the need for
immunosuppressants, is a multi-part, Phase 1/2 study.
- Vertex has completed Part A of the study.
- Per protocol, the Independent Data Monitoring Committee
reviewed the totality of the data from the patients dosed in Part A
of the study and recommended advancement to Part B of the study,
which has been initiated in multiple centers and countries.
- Hypoimmune, edited fully differentiated islet cells:
- Vertex’s hypoimmune cell program involves using CRISPR/Cas9 to
gene edit the same stem cell-derived, fully differentiated islets
used in the VX-880 and VX-264 programs to cloak the cells from the
immune system. This program is progressing through the research
stage.
Non-GAAP Financial
Measures
In this press release, Vertex's financial results and financial
guidance are provided in accordance with accounting principles
generally accepted in the United States (GAAP) and using certain
non-GAAP financial measures. In particular, non-GAAP financial
results and guidance exclude from Vertex's pre-tax income (i)
stock-based compensation expense, (ii) intangible asset
amortization expense, (iii) gains or losses related to the fair
value of the company's strategic investments, (iv) increases or
decreases in the fair value of contingent consideration, (v)
acquisition-related costs, (vi) an intangible asset impairment
charge and (vii) other adjustments. The company's non-GAAP
financial results also exclude from its provision for income taxes
the estimated tax impact related to its non-GAAP adjustments to
pre-tax income described above and certain discrete items. These
results should not be viewed as a substitute for the company’s GAAP
results and are provided as a complement to results provided in
accordance with GAAP. Management believes these non-GAAP financial
measures help indicate underlying trends in the company's business,
are important in comparing current results with prior period
results and provide additional information regarding the company's
financial position that the company believes is helpful to an
understanding of its ongoing business. Management also uses these
non-GAAP financial measures to establish budgets and operational
goals that are communicated internally and externally, to manage
the company's business and to evaluate its performance. The
company’s calculation of non-GAAP financial measures likely differs
from the calculations used by other companies. A reconciliation of
the GAAP financial results to non-GAAP financial results is
included in the attached financial information.
The company provides guidance regarding combined R&D,
Acquired IPR&D and SG&A expenses and effective tax rate on
a non-GAAP basis. Unless otherwise noted, the guidance regarding
combined GAAP and non-GAAP R&D, Acquired IPR&D and SG&A
expenses does not include estimates associated with any potential
future business development transactions, including collaborations,
asset acquisitions and/or licensing of third-party intellectual
property rights. The company does not provide guidance regarding
its GAAP effective tax rate because it is unable to forecast with
reasonable certainty the impact of excess tax benefits related to
stock-based compensation and the possibility of certain discrete
items, which could be material.
Vertex Pharmaceuticals
Incorporated
Consolidated Statements of
Income
(in millions, except per share
amounts)(unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2023
2022
2023
2022
Product revenues, net
$
2,517.7
$
2,302.7
$
9,869.2
$
8,930.7
Costs and expenses:
Cost of sales
368.0
283.3
1,262.2
1,080.3
Research and development expenses
824.6
694.1
3,162.9
2,540.3
Acquired in-process research and
development expenses
17.8
22.6
527.1
115.5
Selling, general and administrative
expenses
369.1
267.4
1,136.6
944.7
Change in fair value of contingent
consideration
(50.3
)
1.8
(51.6
)
(57.5
)
Total costs and expenses
1,529.2
1,269.2
6,037.2
4,623.3
Income from operations
988.5
1,033.5
3,832.0
4,307.4
Interest income
179.5
86.0
614.7
144.6
Interest expense
(10.6
)
(11.6
)
(44.1
)
(54.8
)
Other expense, net
(9.8
)
(31.1
)
(22.8
)
(164.8
)
Income before provision for income
taxes
1,147.6
1,076.8
4,379.8
4,232.4
Provision for income taxes
178.8
257.9
760.2
910.4
Net income
$
968.8
$
818.9
$
3,619.6
$
3,322.0
Net income per common share:
Basic
$
3.76
$
3.19
$
14.05
$
12.97
Diluted
$
3.71
$
3.15
$
13.89
$
12.82
Shares used in per share calculations:
Basic
257.7
256.9
257.7
256.1
Diluted
260.9
260.3
260.5
259.1
Vertex Pharmaceuticals
Incorporated
Product Revenues
(in millions)(unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2023
2022
2023
2022
TRIKAFTA/KAFTRIO
$
2,333.3
$
2,021.5
$
8,944.7
$
7,686.8
Other CF products
184.4
281.2
924.5
1,243.9
Product revenues, net
$
2,517.7
$
2,302.7
$
9,869.2
$
8,930.7
Vertex Pharmaceuticals
Incorporated
Reconciliation of GAAP to
Non-GAAP Financial Information
(in millions, except
percentages)(unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2023
2022
2023
2022
GAAP cost of sales
$
368.0
$
283.3
$
1,262.2
$
1,080.3
Stock-based compensation expense
(2.1
)
(2.4
)
(7.5
)
(9.4
)
Intangible asset amortization expense
(1.7
)
—
(1.7
)
—
Non-GAAP cost of sales
$
364.2
$
280.9
$
1,253.0
$
1,070.9
GAAP research and development
expenses
$
824.6
$
694.1
$
3,162.9
$
2,540.3
Stock-based compensation expense
(123.0
)
(68.0
)
(354.9
)
(297.9
)
Intangible asset impairment charge (3)
—
—
—
(13.0
)
Acquisition-related costs (4)
(2.8
)
(2.8
)
(11.3
)
(24.9
)
Non-GAAP research and development
expenses
$
698.8
$
623.3
$
2,796.7
$
2,204.5
Acquired in-process research and
development expenses
$
17.8
$
22.6
$
527.1
$
115.5
GAAP selling, general and
administrative expenses
$
369.1
$
267.4
$
1,136.6
$
944.7
Stock-based compensation expense
(83.5
)
(41.1
)
(218.8
)
(184.0
)
Acquisition-related costs (4)
—
(0.7
)
—
(13.9
)
Non-GAAP selling, general and
administrative expenses
$
285.6
$
225.6
$
917.8
$
746.8
Combined non-GAAP R&D, Acquired
IPR&D and SG&A expenses
$
1,002.2
$
871.5
$
4,241.6
$
3,066.8
GAAP other expense, net
$
(9.8
)
$
(31.1
)
$
(22.8
)
$
(164.8
)
Decrease in fair value of strategic
investments
0.4
6.0
0.6
149.1
Non-GAAP other expense, net
$
(9.4
)
$
(25.1
)
$
(22.2
)
$
(15.7
)
GAAP provision for income taxes
$
178.8
$
257.9
$
760.2
$
910.4
Tax adjustments (1)
35.5
(36.3
)
194.7
101.7
Non-GAAP provision for income
taxes
$
214.3
$
221.6
$
954.9
$
1,012.1
GAAP effective tax rate
15.6
%
24.0
%
17.4
%
21.5
%
Non-GAAP effective tax rate
16.3
%
18.5
%
19.4
%
20.8
%
Vertex Pharmaceuticals
Incorporated
Reconciliation of GAAP to
Non-GAAP Financial Information (continued)
(in millions, except per share
amounts)(unaudited)
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2023
2022
2023
2022
GAAP operating income
$
988.5
$
1,033.5
$
3,832.0
$
4,307.4
Stock-based compensation expense
208.6
111.5
581.2
491.3
Intangible asset amortization expense
1.7
—
1.7
—
Decrease (increase) in fair value of
contingent consideration (3)
(50.3
)
1.8
(51.6
)
(57.5
)
Intangible asset impairment charge (3)
—
—
—
13.0
Acquisition-related costs (4)
2.8
3.5
11.3
38.8
Non-GAAP operating income
$
1,151.3
$
1,150.3
$
4,374.6
$
4,793.0
Three Months Ended
December 31,
Twelve Months Ended
December 31,
2023
2022
2023
2022
GAAP net income
$
968.8
$
818.9
$
3,619.6
$
3,322.0
Stock-based compensation expense
208.6
111.5
581.2
491.3
Intangible asset amortization expense
1.7
—
1.7
—
Decrease in fair value of strategic
investments
0.4
6.0
0.6
149.1
Decrease (increase) in fair value of
contingent consideration (3)
(50.3
)
1.8
(51.6
)
(57.5
)
Intangible asset impairment charge (3)
—
—
—
13.0
Acquisition-related costs (4)
2.8
3.5
11.3
38.8
Total non-GAAP adjustments to pre-tax
income
163.2
122.8
543.2
634.7
Tax adjustments (1)
(35.5
)
36.3
(194.7
)
(101.7
)
Non-GAAP net income
$
1,096.5
$
978.0
$
3,968.1
$
3,855.0
Net income per diluted common share:
GAAP
$
3.71
$
3.15
$
13.89
$
12.82
Non-GAAP
$
4.20
$
3.76
$
15.23
$
14.88
Shares used in diluted per share
calculations:
GAAP and Non-GAAP
260.9
260.3
260.5
259.1
Vertex Pharmaceuticals
Incorporated
Condensed Consolidated Balance
Sheets
(in millions)(unaudited)
December 31, 2023
December 31, 2022
Assets
Cash, cash equivalents and marketable
securities
$
11,218.3
$
10,778.5
Accounts receivable, net
1,563.4
1,442.2
Inventories
738.8
460.6
Prepaid expenses and other current
assets
623.7
553.5
Total current assets
14,144.2
13,234.8
Property and equipment, net
1,159.3
1,108.4
Goodwill and intangible assets, net
1,927.9
1,691.6
Deferred tax assets
1,812.1
1,246.9
Operating lease assets
293.6
347.4
Long-term marketable securities
2,497.8
112.2
Other long-term assets
895.3
409.6
Total assets
$
22,730.2
$
18,150.9
Liabilities and Shareholders'
Equity
Accounts payable and accrued expenses
$
3,020.2
$
2,430.6
Other current liabilities
527.2
311.5
Total current liabilities
3,547.4
2,742.1
Long-term finance lease liabilities
376.1
430.8
Long-term operating lease liabilities
348.6
379.5
Other long-term liabilities
877.7
685.8
Shareholders' equity
17,580.4
13,912.7
Total liabilities and shareholders'
equity
$
22,730.2
$
18,150.9
Common shares outstanding
257.7
257.0
Notes and Explanations
1: In the three and twelve months ended December 31, 2023
and 2022, "Tax adjustments" included the estimated income taxes
related to non-GAAP adjustments to the company's pre-tax income and
excess tax benefits related to stock-based compensation. “Tax
adjustments” for the twelve months ended December 31, 2023 also
included a $75 million discrete benefit related to prior tax years
resulting from a R&D tax credit study that was completed during
the third quarter of 2023. “Tax adjustments” for the twelve months
ended December 31, 2022 included $60 million of net discrete tax
expense related to our uncertain tax positions associated with
intercompany transfer pricing matters partially offset by changes
in our estimated prior-year tax liabilities.
2: The difference between the company’s full year 2024
combined GAAP R&D, Acquired IPR&D and SG&A expenses and
combined non-GAAP R&D, Acquired IPR&D and SG&A expenses
guidance relates primarily to $600 million to $700 million of
stock-based compensation expense. Unless otherwise noted, the
guidance regarding combined GAAP and non-GAAP R&D, Acquired
IPR&D and SG&A expenses does not include estimates
associated with any potential future business development
transactions, including collaborations, asset acquisitions and/or
licensing of third-party intellectual property rights.
3: In the three months ended December 31, 2023, the
company determined that additional pre-clinical studies for DMD
will be required, which resulted in a decrease in the associated
fair value of contingent consideration. In the three months ended
June 30, 2022, the company revised the scope of certain acquired
programs, resulting in a decrease in the associated fair value of
contingent consideration and a $13 million “Intangible asset
impairment charge.”
4: "Acquisition-related costs" in the three and twelve
months ended December 31, 2023 and 2022 related to costs associated
with the company's acquisition of Exonics and ViaCyte.
Note:
Amounts may not foot due to rounding.
About Vertex
Vertex is a global biotechnology company that invests in
scientific innovation to create transformative medicines for people
with serious diseases. The company has approved medicines that
treat the underlying causes of multiple chronic, life-shortening
genetic diseases — cystic fibrosis, sickle cell disease and
transfusion-dependent beta thalassemia — and continues to advance
clinical and research programs in these diseases. Vertex also has a
robust clinical pipeline of investigational therapies across a
range of modalities in other serious diseases where it has deep
insight into causal human biology, including APOL1-mediated kidney
disease, acute and neuropathic pain, type 1 diabetes, myotonic
dystrophy type 1 and alpha-1 antitrypsin deficiency.
Vertex was founded in 1989 and has its global headquarters in
Boston, with international headquarters in London. Additionally,
the company has research and development sites and commercial
offices in North America, Europe, Australia, Latin America and the
Middle East. Vertex is consistently recognized as one of the
industry's top places to work, including 14 consecutive years on
Science magazine's Top Employers list and one of Fortune’s 100 Best
Companies to Work For. For company updates and to learn more about
Vertex's history of innovation, visit www.vrtx.com or follow us on
LinkedIn, Facebook, Instagram, YouTube and Twitter/X.
Special Note Regarding Forward-Looking Statements
This press release contains forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995, as
amended, including, without limitation, Dr. Kewalramani's
statements in this press release, the information provided
regarding future financial performance and operations, the section
captioned “Full Year 2024 Financial Guidance” and statements
regarding (i) expectations for continued growth in the number
treated with our CF medicines, including through new approvals and
reimbursements for eligible younger children, our continued work
with reimbursement authorities to ensure access for eligible
patients, and expectations for expansion of treatment options for
patients that have a rare mutation of the CFTR gene, including the
N1303K and non-canonical splice mutations, (ii) expectations
associated with the recent and anticipated regulatory approvals for
CASGEVY, including plans to pursue additional EAPs outside of the
U.S., plans to submit additional regulatory filings for CASGEVY,
expectations for potential CASGEVY revenue, expectations around the
plans to activate ATCs in the U.S., Europe and KSA, expectations
associated with our agreement with Synergie Medication Collective,
as well as our beliefs regarding the potential benefits of the CGT
Access Model, (iii) expectations, plans, and status of the
potential near-term commercial launch of
vanzacaftor/tezacaftor/deutivacaftor in CF, including our plans to
submit regulatory filings in the U.S., Europe and Canada in
mid-2024 and plans to use a priority review voucher in the U.S.,
(iv) expectations, plans, and status of the potential near-term
commercial launch of VX-548 for the treatment of moderate to severe
acute pain, including expectations regarding the potential benefits
of VX-548, and our plans to submit regulatory filings by mid-2024,
(v) expectations, development plans, and anticipated timelines for
the company's products, product candidates and pipeline programs,
including expectations for multiple additional near-term clinical
milestones, study designs, patient enrollment, data availability,
potential launches and timing thereof, (vi) expectations for the
expansion of treatment options for patients who cannot benefit from
CFTR modulators alone, our collaboration with Moderna to develop
CFTR mRNA therapeutics and the status of the MAD portion of the
study for VX-522 and expectations to share data from this study in
late 2024 or early 2025, (vii) expectations regarding our SCD and
TDT program and clinical trials including expectations that a
gentler conditioning for CASGEVY could broaden the eligible patient
population to more than 150,000 people, (viii) expectations
regarding our PNP program, including expectations to meet with
regulators and advance VX-548 for PNP into pivotal development and
timing thereof, the status of our Phase 2 study of VX-548 in LSR,
and our plans to initiate a Phase 2 study with an oral formulation
of VX-993 in 2024, (ix) expectations regarding our acute pain
program, including plans to initiate a Phase 2 study with an oral
formulation of VX-993 in 2024, expectations around completing
IND-enabling studies and filing an IND for an intravenous
formulation of VX-993 in 2024, and plans to continue to develop
NaV1.7 and NaV1.8 inhibitors for both acute pain and PNP, (x)
expectations regarding the potential benefits of our AMKD program
and plans to select a dose for the Phase 3 portion and begin the
Phase 3 study of inaxaplin in the first quarter of 2024, and (xi)
expectations regarding our T1D programs, including the potential
benefits of our T1D programs that use stem-cell derived, fully
differentiated islet cells, and expectations for the advancement of
our T1D programs, including clinical trial designs and clinical
progress. While Vertex believes the forward-looking statements
contained in this press release are accurate, these forward-looking
statements represent the company's beliefs only as of the date of
this press release and there are a number of risks and
uncertainties that could cause actual events or results to differ
materially from those expressed or implied by such forward-looking
statements. Those risks and uncertainties include, among other
things, that the company's expectations regarding its 2024 full
year product revenues, expenses and effective tax rates may be
incorrect (including because one or more of the company's
assumptions underlying its expectations may not be realized), that
the company may not be able to receive adequate reimbursement or
additional regulatory approval for CASGEVY on the expected
timeline, or at all, that we are unable to successfully develop,
obtain approval or commercialize VX-548 as a treatment for acute or
neuropathic pain, that external factors may have different or more
significant impacts on the company's business or operations than
the company currently expects, that data from preclinical testing
or clinical trials, especially if based on a limited number of
patients, may not be indicative of final results or available on
anticipated timelines, that patient enrollment in our trials may be
delayed, that the company may not realize the anticipated benefits
from our collaborations with third parties, that data from the
company's development programs may not support registration or
further development of its potential medicines in a timely manner,
or at all, due to safety, efficacy or other reasons, that
anticipated commercial launches may be delayed, if they occur at
all, and other risks listed under the heading “Risk Factors” in
Vertex's annual report and subsequent quarterly reports filed with
the Securities and Exchange Commission (SEC) and available through
the company's website at www.vrtx.com and on the SEC’s website at
www.sec.gov. You should not place undue reliance on these
statements, or the scientific data presented. Vertex disclaims any
obligation to update the information contained in this press
release as new information becomes available.
Conference Call and
Webcast
The company will host a conference call and webcast at 4:30 p.m.
ET. To access the call, please dial (833) 630-2124 (U.S.) or
+1(412) 317-0651 (International) and reference the “Vertex
Pharmaceuticals Fourth Quarter 2023 Earnings Call.”
The conference call will be webcast live and a link to the
webcast can be accessed through Vertex's website at www.vrtx.com in
the "Investors" section. To ensure a timely connection, it is
recommended that participants register at least 15 minutes prior to
the scheduled webcast. An archived webcast will be available on the
company's website.
(VRTX-E)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240205690690/en/
Vertex: Investor Relations: Susie Lisa, CFA,
617-341-6108 Manisha Pai, 617-961-1899 Miroslava Minkova,
617-341-6135
Media: 617-341-6992 mediainfo@vrtx.com
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