United Therapeutics Corporation (Nasdaq: UTHR), a public
benefit corporation, today announced its financial results for the
quarter ended June 30, 2023. Total revenues in the second quarter
of 2023 grew 28% year-over-year to $596.5 million, compared to
$466.9 million in the second quarter of 2022.
“I’m thrilled that United Therapeutics continues to report
double-digit revenue growth and our highest quarterly revenue
ever,” said Martine Rothblatt, Ph.D., Chairperson and Chief
Executive Officer. “We expect this growth trajectory to continue
with our current business as we expect to reach a $4 billion annual
revenue run rate by mid-decade. Beyond that we expect continued
waves of growth with an additional doubling of our revenue from the
potential launch of Tyvaso in pulmonary fibrosis and ralinepag in
pulmonary arterial hypertension, and then yet another doubling of
our revenue with the potential for an unlimited supply of
tolerable, transplantable organs in the next decade.”
“Tyvaso and Orenitram continue to drive our revenue performance
with record revenues and the highest number of patients on both
therapies,” said Michael Benkowitz, President and Chief
Operating Officer. “Feedback on Tyvaso DPI has been overwhelmingly
positive, and its convenience and ease of use have revolutionized
the way patients with pulmonary hypertension manage their
disease.”
Second Quarter 2023 Financial
Results
Key financial highlights include (dollars
in millions, except per share data):
Three Months Ended June
30,
Dollar Change
Percentage Change
2023
2022
Total revenues
$
596.5
$
466.9
$
129.6
28
%
Net income
$
259.2
$
116.0
$
143.2
123
%
Net income, per basic share
$
5.53
$
2.56
$
2.97
116
%
Net income, per diluted share
$
5.24
$
2.41
$
2.83
117
%
Revenues
The table below presents the components of
total revenues (dollars in millions):
Three Months Ended June
30,
Dollar Change
Percentage Change
2023
2022
Net product sales:
Tyvaso®(1)
$
318.9
$
201.0
$
117.9
59
%
Remodulin®(2)
127.2
132.0
(4.8
)
(4
)%
Orenitram®
95.1
79.0
16.1
20
%
Unituxin®
44.3
44.5
(0.2
)
—
%
Adcirca®
7.5
10.4
(2.9
)
(28
)%
Other
3.5
—
3.5
NM
(3)
Total revenues
$
596.5
$
466.9
$
129.6
28
%
(1)
Net product sales include both the drug
product and the respective inhalation devices for both nebulized
Tyvaso Inhalation Solution and the dry powder version known as
Tyvaso DPI®.
(2)
Net product sales include sales of
infusion devices, such as the Remunity® Pump.
(3)
Calculation is not meaningful.
Net product sales from our treprostinil-based products (Tyvaso,
Remodulin, and Orenitram) grew by $129.2 million, or 31%, for the
second quarter of 2023, as compared to the second quarter of 2022.
The growth in Tyvaso revenues resulted primarily from an increase
in quantities sold to our domestic distributors of $112.0 million.
$96.9 million of this growth resulted from an increased number of
patients following the commercial launch of Tyvaso DPI in June 2022
and continued growth in the number of patients following the Tyvaso
label expansion in March 2021 to include the treatment of pulmonary
hypertension associated with interstitial lung disease. The
remaining increase in quantities sold of $15.1 million resulted
from increased inventory levels held by our distributors as they
began to build their inventory to contractually-required inventory
levels and in response to increased patient demand. We anticipate
continued fluctuations in specialty pharmacy inventory levels as we
continue to adjust production schedules and expand capacity to meet
the growing demand for Tyvaso DPI.
Expenses
Cost of sales. The table below
summarizes cost of sales by major category (dollars in
millions):
Three Months Ended June
30,
Dollar Change
Percentage Change
2023
2022
Category:
Cost of sales
$
63.2
$
27.1
$
36.1
133
%
Share-based compensation expense(1)
0.9
2.6
(1.7
)
(65
)%
Total cost of sales
$
64.1
$
29.7
$
34.4
116
%
(1)
Refer to Share-based compensation
below.
Cost of sales, excluding share-based
compensation. Cost of sales for the three months ended June 30,
2023 increased as compared to the same period in 2022, primarily
due to an increase in Tyvaso DPI royalty expense and product costs,
following the commercial launch of the product in June 2022.
Research and development expense.
The table below summarizes the nature of research and development
expense by major expense category (dollars in millions):
Three Months Ended June
30,
Dollar Change
Percentage Change
2023
2022
Category:
External research and development(1)
$
49.3
$
43.9
$
5.4
12
%
Internal research and development(2)
34.7
34.9
(0.2
)
(1
)%
Share-based compensation expense(3)
5.0
14.4
(9.4
)
(65
)%
Impairments(4)
—
—
—
—
%
Other(5)
—
0.7
(0.7
)
(100
)%
Total research and development expense
$
89.0
$
93.9
$
(4.9
)
(5
)%
(1)
External research and development
primarily includes fees paid to third parties (such as clinical
trial sites, contract research organizations, and contract
laboratories) for preclinical and clinical studies and payments to
third-party contract manufacturers before FDA approval of the
relevant product.
(2)
Internal research and development
primarily includes salary-related expenses for research and
development functions, internal costs to manufacture product
candidates before FDA approval, and internal facilities-related
expenses, including depreciation, related to research and
development activities.
(3)
Refer to Share-based compensation
below.
(4)
Impairments primarily includes impairment
charges to write down the carrying value of in-process research and
development and of certain property, plant, and equipment as a
result of research and development activities. There were no
impairment charges during the three months ended June 30, 2023 and
June 30, 2022.
(5)
Other primarily includes upfront fees and
milestone payments to third parties under license agreements
related to development-stage products and adjustments to the fair
value of our contingent consideration obligations.
Research and development expense,
excluding share-based compensation. Research and development
expense for the three months ended June 30, 2023 increased as
compared to the same period in 2022, primarily due to: (1)
increased expenditures related to the TETON 1 and TETON 2 clinical
studies of nebulized Tyvaso in patients with idiopathic pulmonary
fibrosis; and (2) increased expenditures related to ralinepag
clinical studies; partially offset by a decrease in Tyvaso DPI
research and development costs following FDA approval of the
product in May 2022.
Selling, general, and administrative
expense. The table below summarizes selling, general, and
administrative expense by major category (dollars in millions):
Three Months Ended June
30,
Dollar Change
Percentage Change
2023
2022
Category:
General and administrative
$
102.0
$
76.9
$
25.1
33
%
Sales and marketing
20.1
16.1
4.0
25
%
Share-based compensation expense(1)
7.9
48.5
(40.6
)
(84
)%
Total selling, general, and administrative
expense
$
130.0
$
141.5
$
(11.5
)
(8
)%
(1)
Refer to Share-based compensation
below.
General and administrative, excluding share-based compensation.
General and administrative expense for the three months ended June
30, 2023 increased as compared to the same period in 2022,
primarily due to: (1) an increase in sponsorships and grants; (2)
an increase in personnel expense due to growth in headcount; (3) an
increase in branded prescription drug fee expense associated with
sales of Tyvaso; and (4) an impairment charge related to property,
plant, and equipment; partially offset by decreased expenditures
for legal services.
Share-based compensation. The table
below summarizes share-based compensation expense by major category
(dollars in millions):
Three Months Ended June
30,
Dollar Change
Percentage Change
2023
2022
Category:
Stock options
$
1.6
$
5.6
$
(4.0
)
(71
)%
Restricted stock units
13.6
7.4
6.2
84
%
Share tracking awards plan
(STAP)
(1.9
)
52.1
(54.0
)
(104
)%
Employee stock purchase plan
0.5
0.4
0.1
25
%
Total share-based compensation expense
$
13.8
$
65.5
$
(51.7
)
(79
)%
The decrease in share-based compensation expense for the three
months ended June 30, 2023, as compared to the same period in 2022,
was primarily due to an increase in STAP benefit driven by a one
percent decrease in our stock price for the three months ended June
30, 2023, as compared to a 31 percent increase in our stock price
for the same period in 2022.
Other expense, net. The change in other expense, net for
the three months ended June 30, 2023, as compared to the same
period in 2022, was primarily due to net unrealized losses on
equity securities.
Income tax expense. Income tax expense for the three
months ended June 30, 2023 and 2022 was $76.0 million and $34.6
million, respectively. Our effective income tax rate was 23 percent
for the three months ended June 30, 2023 and 2022.
Webcast
We will host a webcast to discuss our second quarter 2023
financial results on Wednesday, August 2, 2023, at 9:00 a.m.
Eastern Time. The webcast can be accessed live via our website at
https://ir.unither.com/events-and-presentations/default.aspx. A
replay of the webcast will also be available at the same location
on our website.
United Therapeutics: Enabling Inspiration
At United Therapeutics, our vision and mission are one. We use
our enthusiasm, creativity, and persistence to innovate for the
unmet medical needs of our patients and to benefit our other
stakeholders. We are bold and unconventional. We have fun, we do
good. We are the first publicly-traded biotech or pharmaceutical
company to take the form of a public benefit corporation
(PBC). Our public benefit purpose is to provide a brighter
future for patients through (a) the development of novel
pharmaceutical therapies; and (b) technologies that expand the
availability of transplantable organs.
You can learn more about what it means to be a PBC here:
unither.com/PBC.
Forward-Looking Statements
Statements included in this press release that are not
historical in nature are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include, among others, statements
related to our future revenue expectations, including our
anticipated $4 billion annual revenue run rate by mid-decade, our
projected multiple waves of growth thereafter resulting in twice
doubling our revenues, and our expectation of continued strong
revenue performance for Tyvaso and Orenitram; the potential
launches of Tyvaso for pulmonary fibrosis and ralinepag for
pulmonary arterial hypertension; the potential launch of an
unlimited supply of tolerable, transplantable organs in the next
decade; our expectations regarding future inventory levels held by
our distributors; and our goals of innovating for the unmet medical
needs of our patients and to benefit our other stakeholders,
furthering our public benefit purpose of developing novel
pharmaceutical therapies and technologies that expand the
availability of transplantable organs, providing superior financial
performance for shareholders, and providing our communities with
earth-sensitive energy utilization. These forward-looking
statements are subject to certain risks and uncertainties, such as
those described in our periodic reports filed with the Securities
and Exchange Commission, that could cause actual results to differ
materially from anticipated results. Consequently, such
forward-looking statements are qualified by the cautionary
statements, cautionary language and risk factors set forth in our
periodic reports and documents filed with the Securities and
Exchange Commission, including our most recent Annual Report on
Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on
Form 8-K. We claim the protection of the safe harbor contained in
the Private Securities Litigation Reform Act of 1995 for
forward-looking statements. We are providing this information as of
August 2, 2023, and assume no obligation to update or revise the
information contained in this press release whether as a result of
new information, future events, or any other reason.
ORENITRAM, REMODULIN, REMUNITY, TYVASO, TYVASO DPI, and UNITUXIN
are registered trademarks of United Therapeutics Corporation and/or
its subsidiaries.
ADCIRCA is a registered trademark of Eli Lilly and Company.
UNITED THERAPEUTICS
CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS
(In millions, except per share
data)
Three Months Ended June
30,
2023
2022
(Unaudited)
Total revenues
$
596.5
$
466.9
Operating expenses:
Cost of sales
64.1
29.7
Research and development
89.0
93.9
Selling, general, and administrative
130.0
141.5
Total operating expenses
283.1
265.1
Operating income
313.4
201.8
Interest income
37.2
6.8
Interest expense
(14.8
)
(6.2
)
Other expense, net
(0.6
)
(51.8
)
Total other income (expense), net
21.8
(51.2
)
Income before income taxes
335.2
150.6
Income tax expense
(76.0
)
(34.6
)
Net income
$
259.2
$
116.0
Net income per common share:
Basic
$
5.53
$
2.56
Diluted
$
5.24
$
2.41
Weighted average number of common shares
outstanding:
Basic
46.9
45.4
Diluted
49.5
48.1
SELECTED CONSOLIDATED BALANCE
SHEET DATA
(Unaudited, in
millions)
June 30, 2023
Cash, cash equivalents, and marketable
investments
$
4,702.6
Total assets
6,681.3
Total liabilities
1,270.3
Total stockholders’ equity
5,411.0
Category: Earnings
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230802318354/en/
Dewey Steadman at (202) 919-4097 Email: ir@unither.com
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