Puma Biotechnology, Inc. (NASDAQ: PBYI), a biopharmaceutical
company, announced financial results for the second quarter ended
June 30, 2023. Unless otherwise stated, all comparisons are for the
second quarter of 2023 compared to the second quarter of 2022.
Product revenue, net consists entirely of sales revenue from
NERLYNX®, Puma’s first commercial product. Product revenue, net in
the second quarter of 2023 was $51.6 million, an increase from
$51.3 million reported for the second quarter of 2022. Product
revenue, net in the first six months of 2023 was $98.3 million,
compared to $92.0 million in the first six months of 2022.
Based on accounting principles generally accepted in the United
States (GAAP), Puma reported net income of $2.1 million, or $0.05
per basic and diluted share, for the second quarter of 2023,
compared to net income of $9.4 million, or $0.21 per basic and
diluted share, for the second quarter of 2022. Net income for the
first six months of 2023 was $3.5 million, or $0.08 per basic share
and $0.07 per diluted share, compared to net income of $6.0
million, or $0.14 per basic and diluted share, for the first six
months of 2022.
Non-GAAP adjusted net income was $4.6 million, or $0.10 per
basic and diluted share, for the second quarter of 2023, compared
to $12.6 million, or $0.28 per basic and diluted share, for the
second quarter of 2022. Non-GAAP adjusted net income for the first
six months of 2023 was $8.8 million, or $0.19 per basic and diluted
share, compared to $12.3 million, or $0.28 per basic and diluted
share, for the first six months of 2022. Non-GAAP adjusted net
income excludes stock-based compensation expense. For a
reconciliation of GAAP net income to non-GAAP adjusted net income
and GAAP net income per share to non-GAAP adjusted net income per
share, please see the financial tables at the end of this news
release.
Net cash provided by operating activities for the second quarter
of 2023 was $3.3 million, compared to net cash used in operating
activities of $13.9 million in the second quarter of 2022. Net cash
provided by operating activities for the first six months of 2023
was $5.9 million, compared to net cash used in operating activities
of $40.8 million in the first six months of 2022. At June 30, 2023,
Puma had cash, cash equivalents and marketable securities of $74.4
million, compared to cash, cash equivalents and marketable
securities of $81.1 million at December 31, 2022.
“We are pleased to report both positive net income and positive
cash flow for the second quarter of 2023,” said Alan H. Auerbach,
Chairman, Chief Executive Officer, and President of Puma. “In
addition, we announced positive biomarker data from the randomized
trial of alisertib plus paclitaxel versus paclitaxel alone in
hormone receptor positive, HER2-negative breast cancer at the
recent 2023 Annual Meeting of the American Society of Clinical
Oncology (ASCO), which will be helpful as we move forward with the
clinical development of alisertib in this indication.”
Mr. Auerbach added, “We anticipate the following key milestones
over the next 12 months: (i) initiating a Phase II clinical trial
of alisertib in small cell lung cancer (H2 2023); (ii) conducting a
meeting with the FDA to discuss the clinical development and
registration pathway for alisertib in hormone receptor positive,
HER2-negative breast cancer (Q4 2023); and (iii) reporting data
from an ongoing investigator sponsored Phase I/II trial of
alisertib plus pembrolizumab for the treatment of patients with
Rb-deficient head and neck squamous cell cancer (H2 2023).”
Revenue
Total revenue consists of product revenue, net from sales of
NERLYNX, Puma’s first commercial product, license revenue from
Puma’s sub-licensees and royalty revenue. For the second quarter of
2023, total revenue was $54.6 million, of which $51.6 million was
net product revenue and $3.0 million was royalty revenue. This
compares to total revenue of $59.5 million in the second quarter of
2022, of which $51.3 million was net product revenue and $8.2
million was royalty revenue. For the first six months of 2023,
total revenue was $107.3 million, of which $98.3 million was net
product revenue and $9.0 million was royalty revenue. This compares
to total revenue for the first six months of 2022 of $105.3
million, of which $92.0 million was net product revenue and $13.3
million was royalty revenue.
Operating Costs and Expenses
Total operating costs and expenses were $49.7 million for the
second quarter of 2023, compared to $47.4 million for the second
quarter of 2022. Operating costs and expenses in the first six
months of 2023 were $98.0 million, compared to $94.0 million in the
first six months of 2022.
Cost of Sales
Cost of sales was $11.9 million for the second quarter of 2023,
compared to $14.9 million for the second quarter of 2022. Cost of
sales was $25.1 million for the first six months of 2023, compared
to $25.8 million for the first six months of 2022. The decrease was
due to lower royalty expense related primarily to the timing of
sales made in China by Puma’s sub-licensee, partially offset by
increased intangible amortization related to the $12.5 million paid
to Pfizer for meeting a commercial sales milestone as of December
31, 2022.
Selling, General and Administrative Expenses
Selling, general and administrative (SG&A) expenses were
$24.4 million for the second quarter of 2023, compared to $20.6
million for the second quarter of 2022. SG&A expenses for the
first six months of 2023 were $46.8 million, compared to $41.0
million for the first six months of 2022. The $5.8 million
year-over-year increase for the first six months resulted primarily
from an increase in payroll and related costs of approximately $4.7
million, consisting of approximately $2.5 million due to salary and
headcount increases in 2023, as well as a $2.0 million tax credit
related to the CARES Act received during the period ended June 30,
2022. In addition, professional fees and expenses increased
approximately $0.8 million from the first six months of 2022.
Research and Development Expenses
Research and development (R&D) expenses were $13.4 million
for the second quarter of 2023, compared to $11.9 million for the
second quarter of 2022. R&D expenses for the first six months
of 2023 were $26.1 million, compared to $27.2 million for the first
six months of 2022. The $1.1 million year-over-year decrease for
the first six months resulted primarily from a decrease in clinical
trial expense of approximately $3.6 million, primarily due to the
reduction and closure of SUMMIT clinical trial sites, partially
offset by an increase in internal R&D of approximately $2.9
million, due primarily to a $1.8 million tax credit related to the
CARES Act received during the period ended June 30, 2022, as well
as an increase in payroll-related expenses in 2023.
Total Other Income (Expenses)
Total other expenses were $2.6 million for the second quarter of
2023, essentially unchanged from the second quarter of 2022. Total
other expenses were $5.4 million for the first six months of 2023,
compared to total other expenses of $5.2 million for the first six
months of 2022. The $0.2 million year-over-year increase in other
expenses for the first six months of 2023 reflects higher interest
rates on our outstanding notes as well as imputed interest on a
legal settlement, largely offset by increased interest income.
Third Quarter and Full Year 2023 Financial Outlook
Third Quarter 2023
Full Year 2023
Product Revenue, Net
$51 million - $53 million
$205 million - $210 million
Royalty Revenue
$3 million - $5 million
$25 million - $30 million
Net Income
$3 million - $4 million
$20 million - $24 million
Gross to Net Adjustment
17.5% - 18.5%
19% - 20%
Conference Call
Puma Biotechnology will host a conference call to report its
second quarter 2023 financial results and provide an update on the
Company’s business and outlook at 1:30 p.m. PDT/4:30 p.m. EDT on
Thursday, August 3, 2023. The call may be accessed by dialing (877)
709-8150 (domestic) or (201) 689-8354 (international). Please dial
in at least 10 minutes in advance and inform the operator that you
would like to join the “Puma Biotechnology Conference Call.” A live
webcast of the conference call and presentation slides may be
accessed on the Investors section of the Puma Biotechnology website
at https://www.pumabiotechnology.com. A replay of the call will be
available shortly after completion of the call and will be archived
on Puma’s website for 90 days.
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-licensed the global
development and commercialization rights to PB272 (neratinib,
oral), PB272 (neratinib, intravenous) and PB357. Neratinib, oral
was approved by the U.S. Food and Drug Administration in 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. In February 2020, NERLYNX was also
approved by the FDA in combination with capecitabine for the
treatment of adult patients with advanced or metastatic
HER2-positive breast cancer who have received two or more prior
anti-HER2-based regimens in the metastatic setting. NERLYNX was
granted marketing authorization by the European Commission in 2018
for the extended adjuvant treatment of adult patients with early
stage hormone receptor-positive HER2-overexpressed/amplified breast
cancer and who are less than one year from completion of prior
adjuvant trastuzumab-based therapy. NERLYNX is a registered
trademark of Puma Biotechnology, Inc.
In September 2022, Puma entered into an exclusive license
agreement for the development and commercialization of the
anti-cancer drug alisertib, a selective, small molecule, orally
administered inhibitor of aurora kinase A. Initially, Puma intends
to focus the development of alisertib on the treatment of small
cell lung cancer and breast cancer.
To help ensure patients have access to NERLYNX, Puma has
implemented the Puma Patient Lynx support program to assist
patients and healthcare 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
https://www.NERLYNX.com or by calling 1-855-816-5421.
Further information about Puma Biotechnology may be found at
https://www.pumabiotechnology.com.
INDICATIONS
- NERLYNX® (neratinib) tablets, for oral use, is a kinase
inhibitor indicated:
- As a single agent, for the extended adjuvant treatment of adult
patients with early stage HER2-positive breast cancer, to follow
adjuvant trastuzumab-based therapy.
- In combination with capecitabine, for the treatment of adult
patients with advanced or metastatic HER2-positive breast cancer,
who have received two or more prior anti-HER2 based regimens in the
metastatic setting.
Important Safety Information Regarding NERLYNX® (neratinib)
U.S. Indication
CONTRAINDICATIONS: None
WARNINGS AND PRECAUTIONS:
- Diarrhea: Manage diarrhea through either NERLYNX dose
escalation or loperamide prophylaxis. If diarrhea occurs despite
recommended prophylaxis, treat 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 in patients 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
(reported in ≥ 5% of patients) were as follows:
- NERLYNX as a single agent: Diarrhea, nausea, abdominal pain,
fatigue, vomiting, rash, stomatitis, decreased appetite, muscle
spasms, dyspepsia, AST or ALT increased, nail disorder, dry skin,
abdominal distention, epistaxis, weight decreased, and urinary
tract infection.
- NERLYNX in combination with capecitabine: Diarrhea, nausea,
vomiting, decreased appetite, constipation, fatigue/asthenia,
weight decreased, dizziness, back pain, arthralgia, urinary tract
infection, upper respiratory tract infection, abdominal distention,
renal impairment, and muscle spasms.
To report SUSPECTED ADVERSE REACTIONS, contact Puma
Biotechnology, Inc. at 1-844-NERLYNX (1-844-637-5969) 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. Separate NERLYNX by at least 2 hours before or 10
hours after H2-receptor antagonists. Or separate NERLYNX by at
least 3 hours with antacids.
- Strong CYP3A4 inhibitors: Avoid concomitant use.
- P-gp and moderate CYP3A4 dual inhibitors: Avoid concomitant
use.
- Strong or moderate CYP3A4 inducers: Avoid concomitant use.
- Certain P-gp substrates: Monitor for adverse reactions of P-gp
substrates for which minimal concentration change may lead to
serious adverse reactions when used concomitantly with
NERLYNX.
USE IN SPECIFIC POPULATIONS:
- Lactation: Advise women not to breastfeed.
Please see Full Prescribing Information for additional safety
information.
Forward-Looking Statements
This press release contains forward-looking statements,
including statements regarding Puma’s anticipated milestones and
estimates of future financial results for the third quarter and
full year 2023. 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,
any adverse impact on Puma’s business or the global economy and
financial markets, any changes in Puma’s product candidates’
regulatory approvals, results from Puma’s clinical trials, any
litigation involving Puma, any changes to Puma’s in-licensed
intellectual property and 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, 2022 and
subsequent filings. 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
Six Months Ended
June 30,
June 30,
2023
2022
2023
2022
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Revenues: Product revenue, net
$
51.6
$
51.3
$
98.3
$
92.0
License revenue
—
—
—
—
Royalty revenue
3.0
8.2
9.0
13.3
Total revenue
54.6
59.5
107.3
105.3
Operating costs and expenses: Cost of sales
11.9
14.9
25.1
25.8
Selling, general and administrative
24.4
20.6
46.8
41.0
Research and development
13.4
11.9
26.1
27.2
Total operating costs and expenses
49.7
47.4
98.0
94.0
Income from operations
4.9
12.1
9.3
11.3
Other income (expenses): Interest income
0.7
0.1
1.2
0.1
Interest expense
(3.4
)
(2.7
)
(6.6
)
(5.3
)
Legal verdict expense
—
(0.1
)
—
(0.1
)
Other income
0.1
0.1
—
0.1
Total other expenses, net
(2.6
)
(2.6
)
(5.4
)
(5.2
)
Net income before income taxes
$
2.3
$
9.5
$
3.9
$
6.1
Income tax expense
(0.2
)
(0.1
)
(0.4
)
(0.1
)
Net income
$
2.1
$
9.4
$
3.5
$
6.0
Net income per share of common stock—basic
$
0.05
$
0.21
$
0.08
$
0.14
Net income per share of common stock—diluted
$
0.05
$
0.21
$
0.07
$
0.14
Weighted-average shares of common stock outstanding—basic
46,759,062
45,058,924
46,697,912
43,641,193
Weighted-average shares of common stock outstanding—diluted
47,201,185
45,358,739
47,172,752
43,889,556
PUMA BIOTECHNOLOGY, INC. AND SUBSIDIARY LIQUIDITY AND
CAPITAL RESOURCES (in millions)
June 30,
December 31,
2023
2022
(Unaudited)
Cash and cash equivalents
$
60.0
$
76.2
Marketable securities
14.4
4.9
Working capital
58.5
56.8
Short term debt
11.3
—
Long term debt
87.6
98.3
Stockholders' equity
30.4
21.6
Six Months
Six Months
Ended
Ended
June 30,
June 30,
2023
2022
(Unaudited)
(Unaudited)
Cash provided by (used in): Operating activities
$
5.9
$
(40.7
)
Investing activities
(22.1
)
11.0
Financing activities
—
9.8
Decrease in cash and cash equivalents, and restricted cash
$
(16.2
)
$
(19.9
)
Use of Non-GAAP Measures
In addition to operating results as calculated in accordance
with GAAP, Puma uses certain non-GAAP financial measures when
planning, monitoring, and evaluating operational performance. The
following table presents the Company’s net income and net income
per share calculated in accordance with GAAP and as adjusted to
remove the impact of stock-based compensation expense. For the
three months and six months ended June 30, 2023, stock-based
compensation represented approximately 6.4% and 7.2% of total
selling, general and administrative expense and research and
development expense, respectively and 9.9% and 9.3% for the same
periods in 2022. Puma’s management believes that these non-GAAP
financial measures are useful to enhance understanding of Puma’s
financial performance, are more indicative of its 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 Income to Non-GAAP Adjusted Net Income and
GAAP Net Income Per Share to
Non-GAAP Adjusted Net Income Per Share
(in millions except share and
per share data)
(Unaudited)
Three Months Ended June
30,
2023
2022
GAAP net income
$
2.1
$
9.4
Adjustments: Stock-based compensation - Selling, general and
administrative (1)
1.8
2.1
Research and development (2)
0.8
1.1
Non-GAAP adjusted net income
$
4.6
$
12.6
GAAP net income per share—basic
$
0.05
$
0.21
Adjustment to net income (as detailed above)
0.05
0.07
Non-GAAP adjusted basic net income per share
$
0.10
(3
)
$
0.28
(4
)
GAAP net income per share—diluted
$
0.05
$
0.21
Adjustment to net income (as detailed above)
0.05
0.07
Non-GAAP adjusted diluted net income per share
$
0.10
(5
)
$
0.28
(6
)
Six Months Ended June
30,
2023
2022
GAAP net income
$
3.5
$
6.0
Adjustments: Stock-based compensation - Selling, general and
administrative (1)
3.7
4.2
Research and development (2)
1.6
2.1
Non-GAAP adjusted net income
$
8.8
$
12.3
GAAP net income per share—basic
$
0.08
$
0.14
Adjustment to net income (as detailed above)
0.11
0.14
Non-GAAP adjusted basic net income per share
$
0.19
(3
)
$
0.28
(4
)
GAAP net income per share—diluted
$
0.07
$
0.14
Adjustment to net income (as detailed above)
0.12
0.14
Non-GAAP adjusted diluted net income per share
$
0.19
(5
)
$
0.28
(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 basic
net income per share was calculated based on 46,759,062 and
46,697,912 weighted-average shares of common stock outstanding for
the three and six months ended June 30, 2023, respectively. (4)
Non-GAAP adjusted basic net income per share was calculated based
on 45,058,924 and 43,641,193 weighted-average shares of common
stock outstanding for the three and six months ended June 30, 2022,
respectively. (5) Non-GAAP adjusted diluted net income per share
was calculated based on 47,201,185 and 47,172,752 weighted-average
shares of common stock outstanding for the three and six months
ended June 30, 2023, respectively. (6) Non-GAAP adjusted diluted
net income per share was calculated based on 45,358,739 and
43,889,556 weighted-average shares of common stock outstanding for
the three and six months ended June 30, 2022, respectively.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230803523303/en/
Alan H. Auerbach or Mariann Ohanesian, Puma Biotechnology, Inc.,
+1 424 248 6500 info@pumabiotechnology.com
ir@pumabiotechnology.com
David Schull or Olipriya Das, Russo Partners, +1 212 845 4200
david.schull@russopartnersllc.com
olipriya.das@russopartnersllc.com
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