– 3Q23 total revenues of $972 million –
– Combined revenues from key growth drivers, Xywav®,
Epidiolex® and Rylaze®, increased 24%
year-over-year –
– Raising total and Oncology revenue guidance at the mid-points
–
– Plan to initiate zanidatamab rolling biologics license
application (BLA) submission this year for accelerated
approval in second-line (2L) biliary tract cancers (BTC) –
DUBLIN, Nov. 8, 2023 /PRNewswire/ -- Jazz Pharmaceuticals
plc (Nasdaq: JAZZ) today announced financial results for the third
quarter of 2023 and provided business updates.
"We have once again delivered strong financial results from
increasingly diversified revenue streams and remain well-positioned
for long-term growth. Low-sodium Xywav grew 30%
year-over-year despite additional competition, with continued
compelling adoption across both narcolepsy and idiopathic
hypersomnia (IH). Epidiolex is well-positioned to deliver on
its blockbuster potential as a differentiated treatment option with
multiple ex-U.S. launches expected through 2024. Oncology net
product sales grew 17% year-over-year and our Oncology therapeutic
area remains on course to reach approximately $1 billion in annual revenue this year," said
Bruce Cozadd, chairman and chief
executive officer of Jazz Pharmaceuticals. "We have raised our 2023
total revenue guidance yet again, as well as our Oncology revenue
guidance, at the mid-points. We are increasing our investment in
R&D based on our confidence in zanidatamab to raise the
standard of care for patients and create long-term value for Jazz.
Our disciplined capital deployment and strong execution has also
enabled us to increase investment in our key commercial franchises,
while delivering on our full year GAAP net income and non-GAAP
adjusted net income guidance. We remain well-positioned to achieve
Vision 2025."
"We now expect as many as five late-stage readouts from our
robust R&D pipeline by the end of 2024 and continue to progress
multiple early-stage programs in both neuroscience and oncology. We
plan to initiate the zanidatamab rolling BLA submission this year
for accelerated approval in 2L BTC and expect to complete it in the
first half of 2024. Our pivotal, Phase 3 trial of
Epidyolex® in Japan is
progressing well and we now anticipate top-line data in the second
half of 2024. Nearer term catalysts include the anticipated readout
of JZP150 Phase 2 top-line data in PTSD and initial
proof-of-concept from JZP441 in healthy volunteers. The breadth and
depth of our expanded R&D pipeline continues to add to the
diversification and transformation of our company together with the
ability to improve patients' lives," said Rob Iannone, M.D., M.S.C.E., executive vice
president, global head of research and development of Jazz
Pharmaceuticals.
Key Highlights
- Xywav net product sales grew 30% year-over-year;
annualizing at $1.3 billion.
- Total oxybate revenue, including royalties from authorized
generics (AGs), is annualizing at $1.9
billion; 68% of 3Q23 total oxybate revenues were driven by
Xywav.
- Epidiolex/Epidyolex net product sales grew 9%
year-over-year with continued global launch momentum; top-line data
from pivotal, Phase 3 trial in Japan expected in 2H24.
- Rylaze net product sales grew 43% year-over-year
supported by multiple demand drivers.
- Plan to initiate zanidatamab rolling BLA submission this year
for accelerated approval in 2L BTC; expect to complete BLA in
1H24.
- Robust pipeline with as many as five late-stage data readouts
expected by the end of 2024.
- Increased R&D investment driven by confidence in robust
pipeline; reaffirmed full year GAAP net income and non-GAAP
adjusted net income (ANI) guidance.
Business Updates
Key Commercial Products
Xywav (calcium, magnesium, potassium, and sodium
oxybates) oral solution:
- Xywav net product sales increased 30% to $331.6 million in 3Q23 compared to the same
period in 2022; expect Xywav to remain the oxybate of
choice.
- There were approximately 12,050 active Xywav patients
exiting 3Q23.
- The Company continued to present data supporting its scientific
leadership in sleep disorders and highlighting the impact of
low-sodium Xywav for patients with narcolepsy and IH.
- At Psych Congress 2023, a review
of multiple clinical trials demonstrated oxybate improves
sleep quality, sleep architecture and measures of disrupted
nighttime sleep in narcolepsy, independent of once- or
twice-nightly dosing.
- At World Sleep 2023, results from the TENOR study of adults
with narcolepsy showed the most common patient-reported reasons for
utilizing Xywav individualized dosing regimens were to
avoid morning grogginess, help fall asleep and improve sleep
quality. Results from another study, CV-RHYTHM, found patients with
IH experienced a greater burden of cardiovascular comorbidities,
including stroke, heart attacks and heart failure than those
without IH, emphasizing the importance of holistic management to
treat under-recognized sleep disorders.
Xywav for Narcolepsy:
- Continued growth of Xywav in narcolepsy, despite
additional competition, with approximately 9,500 narcolepsy
patients taking Xywav exiting 3Q23.
- The benefits of reducing sodium intake continue to resonate
with patients and prescribers.
Xywav for Idiopathic Hypersomnia (IH):
- There were approximately 2,550 IH patients taking Xywav
exiting 3Q23.
- Jazz survey of sleep specialists indicates 70% anticipate
increasing their prescribing of Xywav for IH over the next
six months, and new prescribers continued to grow in 3Q23.
- Xywav remains the first and only FDA-approved treatment
demonstrating improvement across multiple symptoms, including sleep
inertia, which has a significant impact on patients' quality of
life and daily function.
Xyrem® (sodium oxybate) oral solution:
- Xyrem net product sales decreased 51% to $125.1 million in 3Q23 compared to the same
period in 2022, reflecting the continued adoption of Xywav
by patients with narcolepsy and the launch of high-sodium oxybate
AGs in 2023.
Oxybate (Xywav, Xyrem and AG Royalties):
- Total oxybate revenue, including royalties from AGs, is
annualizing at $1.9 billion.
- Royalties from high-sodium oxybate AGs were $28.9 million in 3Q23, which reflect a
significant increase over 1H23 and the fixed-rate royalty
structures of the AG agreements in 2H23.
Epidiolex/Epidyolex (cannabidiol):
- Epidiolex/Epidyolex net product sales increased 9% to
$213.7 million in 3Q23 compared to
the same period in 2022.
- Epidiolex/Epidyolex global prescriber base increasing
with multiple launches ongoing and anticipated outside of the U.S.
through 2024, further positioning Epidiolex/Epidyolex to
achieve blockbuster status.
- Demand driven by compelling efficacy data from Epidiolex
in combination with clobazam, increased penetration in adults and
long-term care settings, and beyond seizure benefits from the
BECOME caregiver survey in in Dravet syndrome (DS) and
Lennox-Gastaut syndrome (LGS).
- Additional opportunity for growth coming from continued data
generation, including potential beyond seizure benefits from the
EpiCom study in tuberous sclerosis complex (TSC) and multiple
publications at AES 2023.
- A pivotal, Phase 3 trial of Epidyolex in DS, LGS and TSC
in Japan is enrolling patients and
top-line data from the trial are expected in 2H24.
Rylaze/Enrylaze (asparaginase erwinia
chrysanthemi (recombinant)-rywn):
- Rylaze net product sales increased 43% to $104.9 million compared to the same period in
2022.
- Continued strong Rylaze demand driven by multiple
factors, including increased use in adolescents and young adults
with acute lymphoblastic leukemia (ALL) and additional switching of
patients from E. coli-based asparaginase to Rylaze
due to non-hypersensitivity treatment-related issues.
- The European Commission granted marketing authorization for
Enrylaze® (JZP458; a recombinant Erwinia
asparaginase or crisantaspase), marketed as Rylaze in the
U.S. and Canada, for use as a
component of a multi-agent chemotherapeutic regimen for the
treatment of ALL and lymphoblastic lymphoma in adult and pediatric
patients (1 month and older) who developed hypersensitivity or
silent inactivation to E. coli-derived asparaginase. The
Company is planning to begin a rolling launch later this year.
Zepzelca® (lurbinectedin):
- Zepzelca net product sales increased 11% to $78.0 million in 3Q23 compared to the same period
in 2022.
- The Company expects top-line data from the Phase 3 trial
evaluating first-line (1L) use of Zepzelca to readout at the
end of 2024 or early 2025. The trial is assessing the combination
with Tecentriq® (atezolizumab), compared to Tecentriq alone, as
maintenance therapy in patients with extensive-stage small cell
lung cancer after induction chemotherapy, in partnership with F.
Hoffmann-La Roche Ltd (Roche).
Key Pipeline Highlights
Zanidatamab:
- Zanidatamab is a novel bispecific antibody that simultaneously
binds two non-overlapping epitopes of HER2, resulting in multiple
mechanisms of action, potent immune activation and encouraging
antitumor activity in patients.
- The Company plans to initiate the zanidatamab rolling BLA
submission this year for accelerated approval in 2L BTC and expects
to complete the rolling submission 1H24.
- The Company has alignment with FDA on a confirmatory trial in
1L metastatic BTC, where there remains unmet patient need.
- The pivotal HERIZON-GEA-01 trial, evaluating zanidatamab in 1L
gastroesophageal adenocarcinoma, is ongoing and top-line data are
expected in 2024.
- The Company, along with partners, presented zanidatamab data at
ESMO Congress 2023. Results from a Phase 1b/2 study of zanidatamab plus chemotherapy in
combination with tislelizumab for the 1L treatment of HER2-positive
gastric/gastroesophageal junction adenocarcinoma demonstrated
antitumor activity with a confirmed ORR of 75.8%, median duration
of response of 22.8 months and median PFS of 16.7 months and safety
was consistent with previous findings.
JZP150:
- JZP150, a selective fatty acid amide hydrolase, or FAAH,
inhibitor, is in clinical development for the potential treatment
of post-traumatic stress disorder (PTSD).
- Patient enrollment is now complete in the Phase 2 PTSD trial
and top-line data are expected in January
2024.
- The Company received Fast Track Designation for JZP150
development in PTSD from FDA, underscoring the significant unmet
medical needs of patients.
Suvecaltamide (JZP385):
- Suvecaltamide, a highly selective and state dependent modulator
of T-type calcium channels, is in clinical development for the
treatment of essential tremor (ET) and Parkinson's disease
tremor.
- Patient enrollment is ongoing in the Phase 2b ET trial and top-line data readout is
anticipated in 1H24. A Phase 2 trial in patients with Parkinson's
disease tremor is ongoing.
JZP441:
- JZP441 is a potent, highly selective oral orexin-2 receptor
agonist designed to activate orexin signaling with the potential to
be applicable in the treatment of narcolepsy, IH and other sleep
disorders.
- A Phase 1 development program to evaluate safety, tolerability,
pharmacokinetics and pharmacodynamics of JZP441 in sleep-deprived
healthy volunteers is ongoing.
- The Company expects initial proof of concept in healthy
volunteers in 2023.
JZP815:
- JZP815 potently inhibits both monomer- and dimer-driven RAF
signaling and prevents paradoxical pathway activation induced by
BRAF selective inhibition.
- A Phase 1 trial evaluating JZP815 in patients with advanced or
metastatic solid tumors with MAPK pathway alterations is ongoing
and a trial in progress poster of the Phase 1 study was presented
at ESMO Congress 2023.
JZP898:
- JZP898 is an engineered IFNα cytokine pro-drug that is
activated specifically within the tumor microenvironment where it
can stimulate IFNα receptors on cancer-fighting immune effector
cells.
- JZP898 received Investigational New Drug application clearance
and the Company expects to initiate a Phase 1 clinical trial by the
end of the year.
Continued Repurchases under Previously Announced $1.5 Billion Share Repurchase Program
The Company continued repurchases of its ordinary shares on the
open market in the third quarter of 2023 as part of its previously
authorized and announced share repurchase program. As of
September 30, 2023, approximately
$261 million remained available and
authorized for share repurchases, after the purchase of
approximately $75 million shares
during the third quarter of 2023. The timing and amount of
repurchases under the program will depend on a variety of factors,
including the price of the Company's ordinary shares, alternative
investment opportunities, restrictions under the Company's credit
agreement, corporate and regulatory requirements and market
conditions.
Financial Highlights
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
(In thousands, except
per share amounts)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Total
revenues
|
$ 972,140
|
|
$ 940,652
|
|
$
2,822,269
|
|
$
2,687,251
|
GAAP net income
(loss)
|
$ 146,820
|
|
$ (19,648)
|
|
$ 320,678
|
|
$
16,664
|
Non-GAAP adjusted net
income
|
$ 340,148
|
|
$ 370,438
|
|
$ 950,538
|
|
$ 937,837
|
GAAP earnings (loss)
per share
|
$
2.14
|
|
$
(0.31)
|
|
$
4.67
|
|
$
0.26
|
Non-GAAP adjusted
EPS
|
$
4.84
|
|
$
5.17
|
|
$
13.29
|
|
$
13.21
|
GAAP net income (loss) for 3Q23 was $146.8 million, or $2.14 per diluted share, compared to
$(19.6) million, or $(0.31) per
diluted share, for 3Q22.
Non-GAAP adjusted net income for 3Q23 was $340.1 million, or $4.84 per diluted share, compared to $370.4 million, or $5.17 per diluted share, for 3Q22.
Reconciliations of applicable GAAP reported to non-GAAP adjusted
information are included at the end of this press release.
Total Revenues
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
(In
thousands)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Xywav
|
$ 331,633
|
|
$ 255,936
|
|
$ 935,958
|
|
$ 677,041
|
Xyrem
|
125,110
|
|
256,039
|
|
463,009
|
|
772,957
|
Epidiolex/Epidyolex
|
213,711
|
|
196,218
|
|
604,846
|
|
529,400
|
Sativex
|
4,627
|
|
3,220
|
|
14,531
|
|
12,104
|
Sunosi1
|
—
|
|
—
|
|
—
|
|
28,844
|
Total
Neuroscience
|
675,081
|
|
711,413
|
|
2,018,344
|
|
2,020,346
|
Rylaze
|
104,859
|
|
73,513
|
|
292,479
|
|
200,687
|
Zepzelca
|
77,994
|
|
70,320
|
|
215,523
|
|
197,943
|
Defitelio/defibrotide
|
47,730
|
|
49,452
|
|
132,917
|
|
153,637
|
Vyxeos
|
29,827
|
|
30,067
|
|
100,583
|
|
97,714
|
Total
Oncology
|
260,410
|
|
223,352
|
|
741,502
|
|
649,981
|
Other
|
2,907
|
|
1,001
|
|
9,758
|
|
3,576
|
Product sales,
net
|
938,398
|
|
935,766
|
|
2,769,604
|
|
2,673,903
|
High-sodium oxybate AG
royalty revenue
|
28,921
|
|
—
|
|
36,531
|
|
—
|
Other royalty and
contract revenues
|
4,821
|
|
4,886
|
|
16,134
|
|
13,348
|
Total
revenues
|
$ 972,140
|
|
$ 940,652
|
|
$
2,822,269
|
|
$
2,687,251
|
|
|
|
|
|
(1)
Divestiture of Sunosi U.S. was completed in May 2022.
|
Total revenues increased 3% in 3Q23 compared to the same period
in 2022.
- Total neuroscience revenue, including high-sodium oxybate AG
royalty revenue, was $704.0 million
in 3Q23 compared to $711.4 million in
3Q22. Neuroscience net product sales in 3Q23 decreased 5% to
$675.1 million compared to the same
period in 2022 driven by decreased Xyrem revenues,
reflecting the continued strong adoption of Xywav by
patients with narcolepsy and availability of high-sodium oxybate
AGs, offset by increased Xywav and
Epidiolex/Epidyolex net product sales. High-sodium oxybate
AG royalty revenue relates primarily to royalty revenue received
from Hikma Pharmaceuticals plc on net sales of a high-sodium
oxybate AG product.
- Oncology net product sales in 3Q23 increased 17% to
$260.4 million compared to the same
period in 2022 primarily driven by the continued growth in
Rylaze product sales, which increased 43% to $104.9 million.
Operating Expenses and Effective Tax Rate
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
(In thousands, except
percentages)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
GAAP:
|
|
|
|
|
|
|
|
Cost of product
sales
|
$ 102,153
|
|
$ 133,661
|
|
$ 328,334
|
|
$ 373,153
|
Gross
margin
|
89.1 %
|
|
85.7 %
|
|
88.1 %
|
|
86.0 %
|
Selling, general and
administrative
|
$ 308,310
|
|
$ 358,478
|
|
$ 947,071
|
|
$
1,033,764
|
% of total
revenues
|
31.7 %
|
|
38.1 %
|
|
33.6 %
|
|
38.5 %
|
Research and
development
|
$ 234,402
|
|
$ 148,870
|
|
$ 633,050
|
|
$ 417,898
|
% of total
revenues
|
24.1 %
|
|
15.8 %
|
|
22.4 %
|
|
15.6 %
|
Acquired in-process
research and development
|
$
—
|
|
$
—
|
|
$
1,000
|
|
$
69,148
|
Impairment
charge
|
$
—
|
|
$ 133,648
|
|
$
—
|
|
$ 133,648
|
Income tax
benefit
|
$
(47,176)
|
|
$
(43,027)
|
|
$
(86,823)
|
|
$
(58,603)
|
Effective tax rate
1
|
(47.4) %
|
|
71.6 %
|
|
(36.7) %
|
|
178.7 %
|
|
|
|
|
|
|
(1)
|
The GAAP effective tax
rate decreased for the three and nine months ended September 30,
2023 compared to the same periods in 2022, primarily due to the mix
of pre-tax income and losses across tax jurisdictions and the
impact of the nabiximols impairment, which was recognized in
3Q22. The nine months ended September 30, 2022 was also
impacted by the Sunosi divestment.
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
(In thousands, except
percentages)
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Non-GAAP
adjusted:
|
|
|
|
|
|
|
|
Cost of product
sales
|
$
67,119
|
|
$
57,103
|
|
$ 197,841
|
|
$ 158,554
|
Gross
margin
|
92.8 %
|
|
93.9 %
|
|
92.9 %
|
|
94.1 %
|
Selling, general and
administrative
|
$ 273,042
|
|
$ 274,747
|
|
$ 810,428
|
|
$ 814,941
|
% of total
revenues
|
28.1 %
|
|
29.2 %
|
|
28.7 %
|
|
30.3 %
|
Research and
development
|
$ 217,767
|
|
$ 120,802
|
|
$ 583,704
|
|
$ 360,980
|
% of total
revenues
|
22.4 %
|
|
12.8 %
|
|
20.7 %
|
|
13.4 %
|
Acquired in-process
research and development
|
$
—
|
|
$
—
|
|
$
1,000
|
|
$
69,148
|
Income tax
expense
|
$
7,378
|
|
$
44,386
|
|
$
72,785
|
|
$ 137,996
|
Effective tax
rate
|
2.1 %
|
|
10.6 %
|
|
7.1 %
|
|
12.7 %
|
Changes in operating expenses in 3Q23 over the prior year period
are primarily due to the following:
- Cost of product sales decreased in 3Q23 compared to the same
period in 2022, on a GAAP basis, primarily due to lower acquisition
accounting inventory fair value step-up expense, partially offset
by changes in product mix. Cost of product sales increased in 3Q23
compared to the same period in 2022, on a non-GAAP adjusted basis,
primarily due to changes in product mix.
- Selling, general and administrative (SG&A) expenses
decreased in 3Q23 compared to the same period in 2022, on a GAAP
basis, primarily due to restructuring and program termination costs
incurred in 3Q22. SG&A expenses, on a GAAP and on a non-GAAP
adjusted basis, included decreased compensation-related expenses
and increased investment in our priority programs.
- Research and development (R&D) expenses increased in 3Q23
compared to the same period in 2022, on a GAAP and on a non-GAAP
adjusted basis, primarily due to the inclusion of costs related to
zanidatamab, as well as our other key pipeline programs.
- The impairment charge in 3Q22, on a GAAP basis, related to an
acquired IPR&D asset impairment relating to the discontinuation
of our nabiximols program.
Cash Flow and Balance Sheet
As of September 30,
2023, cash, cash equivalents and investments were $1.6 billion, and the outstanding principal
balance of the Company's long-term debt was $5.8 billion. In addition, the Company had
undrawn borrowing capacity under a revolving credit facility of
$500 million. For the nine months
ended September 30, 2023, the Company generated
$924.7 million of cash from
operations reflecting strong business performance and continued
financial discipline.
2023 Financial Guidance
The Company is updating
its full year 2023 financial guidance as follows:
(In
millions)
|
November 8,
2023
|
|
August 9,
2023
|
Revenues
|
$3,750 -
$3,875
|
|
$3,725 -
$3,875
|
–Neuroscience
(includes royalties from high-sodium
oxybate AG)
|
$2,715 -
$2,825
|
|
$2,715 -
$2,825
|
–Oncology
|
$975 -
$1,050
|
|
$950 -
$1,050
|
GAAP:
(In millions, except
per share amounts and percentages)
|
November 8,
2023
|
|
August 9,
2023
|
Gross margin
%
|
89 %
|
|
89 %
|
SG&A
expenses
|
$1,240 -
$1,295
|
|
$1,220 -
$1,295
|
SG&A expenses
as % of total revenues
|
32% -
35%
|
|
31% -
35%
|
R&D
expenses
|
$844 - $888
|
|
$739 - $793
|
R&D expenses as
% of total revenues
|
22% -
24%
|
|
19% -
21%
|
Effective tax
rate
|
(59)% -
(33)%
|
|
(35)% -
(15)%
|
Net income
|
$450 - $565
|
|
$450 - $565
|
Net income per diluted
share5
|
$6.60 -
$8.15
|
|
$6.60 -
$8.15
|
Weighted-average
ordinary shares used in per share
calculations5
|
72
|
|
72
|
Non-GAAP:
(In millions, except
per share amounts and percentages)
|
November 8,
2023
|
|
August 9,
2023
|
Gross margin
%
|
93%1,6
|
|
93 %
|
SG&A
expenses
|
$1,065 -
$1,1052,6
|
|
$1,045 -
$1,105
|
SG&A expenses
as % of total revenues
|
27% -
29%
|
|
27% -
30%
|
R&D
expenses
|
$780 -
$8203,6
|
|
$675 - $725
|
R&D expenses as
% of total revenues
|
20% -
22%
|
|
17% -
19%
|
Effective tax
rate
|
4% -
6%4,6
|
|
8% - 10%
|
Net income
|
$1,290 -
$1,3406
|
|
$1,290 -
$1,340
|
Net income per diluted
share5
|
$18.15 -
$19.006
|
|
$18.15 -
$19.00
|
Weighted-average
ordinary shares used in per share
calculations5
|
72
|
|
72
|
|
|
|
|
|
1.
|
Excludes $135-$155
million of amortization of acquisition-related inventory fair value
step-up and $14-$15 million of share-based compensation
expense.
|
2.
|
Excludes $152-$167
million of share-based compensation expense and $23 million of
restructuring costs.
|
3.
|
Excludes $64-$68
million of share-based compensation expense.
|
4.
|
Excludes 63%-39% from
the GAAP effective tax rate of (59)%-(33)% relating to the income
tax effect of adjustments between GAAP net income and non-GAAP
adjusted net income, resulting in a non-GAAP adjusted effective tax
rate of 4%-6%.
|
5.
|
Diluted EPS
calculations for 2023 include an estimated 8 million shares related
to the assumed conversion of the Exchangeable Senior Notes and the
associated interest expense add-back to net income of $25 million
and $22 million, on a GAAP and on a non-GAAP adjusted basis,
respectively, under the "if converted" method. In August 2023, we
made the irrevocable election to net share settle our 2024 Notes.
This election is expected to impact our full-year net income per
diluted share guidance by $0.05 to $0.10 per share, on a GAAP
basis, and $0.25 to $0.40 per share, on a Non-GAAP adjusted basis,
as a result of an estimated decrease in the weighted-average shares
outstanding of 1 million shares.
|
6.
|
See "Non-GAAP Financial
Measures" below. Reconciliations of non-GAAP adjusted guidance
measures are included above and, in the table titled
"Reconciliation of GAAP to non-GAAP Adjusted 2023 Net Income
Guidance" at the end of this press release.
|
Conference Call Details
Jazz Pharmaceuticals will host
an investor conference call and live audio webcast today at
4:30 p.m. ET (9:30 p.m. GMT) to provide a business and
financial update and discuss its 2023 third quarter results.
Audio webcast/conference call:
U.S. Dial-In
Number: +1 888 350 4423
Ireland Dial-In Number: +353 1800 943 926
Additional global dial-in numbers are available here.
Passcode: 6907242
Interested parties may access the live audio webcast via the
Investors section of the Jazz Pharmaceuticals website at
www.jazzpharmaceuticals.com. To ensure a timely connection, it is
recommended that participants register at least 15 minutes prior to
the scheduled webcast.
A replay of the webcast will be available via the Investors
section of the Jazz Pharmaceuticals website at
www.jazzpharmaceuticals.com.
About Jazz Pharmaceuticals
Jazz Pharmaceuticals plc
(NASDAQ: JAZZ) is a global biopharmaceutical company whose purpose
is to innovate to transform the lives of patients and their
families. We are dedicated to developing life-changing medicines
for people with serious diseases - often with limited or no
therapeutic options. We have a diverse portfolio of marketed
medicines and novel product candidates, from early- to late-stage
development, in neuroscience and oncology. Within these therapeutic
areas, we are identifying new options for patients by actively
exploring small molecules and biologics, and through innovative
delivery technologies and cannabinoid science. Jazz is
headquartered in Dublin, Ireland
and has employees around the globe, serving patients in nearly 75
countries. Please visit www.jazzpharmaceuticals.com for more
information.
Non-GAAP Financial Measures
To supplement Jazz
Pharmaceuticals' financial results and guidance presented in
accordance with U.S. generally accepted accounting principles
(GAAP), the Company uses certain non-GAAP (also referred to as
adjusted or non-GAAP adjusted) financial measures in this press
release and the accompanying tables. In particular, the Company
presents non-GAAP adjusted net income (and the related per share
measure) and its line item components, as well as certain non-GAAP
adjusted financial measures derived therefrom, including non-GAAP
adjusted gross margin percentage and non-GAAP adjusted effective
tax rate. Non-GAAP adjusted net income (and the related per share
measure) and its line item components exclude from GAAP reported
net income (loss) (and the related per share measure) and its line
item components certain items, as detailed in the reconciliation
tables that follow, and in the case of non-GAAP adjusted net income
(and the related per share measure), adjust for the income tax
effect of the non-GAAP adjustments. In this regard, the components
of non-GAAP adjusted net income, including non-GAAP adjusted cost
of product sales, SG&A expenses and R&D expenses, are
income statement line items prepared on the same basis as, and
therefore components of, the overall non-GAAP adjusted net income
measure.
The Company believes that each of these non-GAAP financial
measures provides useful supplementary information to, and
facilitates additional analysis by, investors and analysts and that
each of these non-GAAP financial measures, when considered together
with the Company's financial information prepared in accordance
with GAAP, can enhance investors' and analysts' ability to
meaningfully compare the Company's results from period to period,
to its forward-looking guidance, and to identify operating trends
in the Company's business. In addition, these non-GAAP financial
measures are regularly used by investors and analysts to model and
track the Company's financial performance. Jazz Pharmaceuticals'
management also regularly uses these non-GAAP financial measures
internally to understand, manage and evaluate the Company's
business and to make operating decisions, and compensation of
executives is based in part on certain of these non-GAAP financial
measures. Because these non-GAAP financial measures are important
internal measurements for Jazz Pharmaceuticals' management, the
Company also believes that these non-GAAP financial measures are
useful to investors and analysts since these measures allow for
greater transparency with respect to key financial metrics the
Company uses in assessing its own operating performance and making
operating decisions. These non-GAAP financial measures are not
meant to be considered in isolation or as a substitute for
comparable GAAP measures; should be read in conjunction with the
Company's consolidated financial statements prepared in accordance
with GAAP; have no standardized meaning prescribed by GAAP; and are
not prepared under any comprehensive set of accounting rules or
principles in the reconciliation tables that follow. In addition,
from time to time in the future there may be other items that the
Company may exclude for purposes of its non-GAAP financial
measures; and the Company has ceased, and may in the future cease,
to exclude items that it has historically excluded for purposes of
its non-GAAP financial measures. Likewise, the Company may
determine to modify the nature of its adjustments to arrive at its
non-GAAP financial measures. Because of the non-standardized
definitions of non-GAAP financial measures, the non-GAAP financial
measures as used by Jazz Pharmaceuticals in this press release and
the accompanying tables have limits in their usefulness to
investors and may be calculated differently from, and therefore may
not be directly comparable to, similarly titled measures used by
other companies.
Caution Concerning Forward-Looking Statements
This
press release contains forward-looking statements, including, but
not limited to, statements related to: the Company's growth
prospects and future financial and operating results, including the
Company's 2023 financial guidance and the Company's expectations
related thereto and anticipated catalysts; the Company's
expectations for total revenue and Oncology revenue growth in 2023
and anticipated product sales; expectations of continued growth in
net sales of Xywav, Epidiolex/Epidyolex and the oncology portfolio;
the blockbuster potential of Epidiolex/Epidyolex and its
significant additional growth opportunities; the Company's
expectations to executing multiple Epidyolex ex-U.S. launches
through 2024; expectations with respect to AGs; the Company's
ability to achieve Vision 2025 and the Company's progress related
thereto; the Company's development, regulatory and
commercialization strategy; the Company's advancement of pipeline
programs and the timing of development activities, regulatory
activities and submissions related thereto, including the ability
to deliver up to five late-stage data readouts by the end of 2024,
expectations to initiate a Phase 1 clinical trial of JZP898 by the
end of this year and proof of concept of JZP441 in 2023,
expectations of top-line data from a Phase 2 trial of JZP150 for
PTSD in the near term, a Phase 3 trial of zanidatamab for GEA in
2024 and a Phase 3 trial of Epidyolex for DS, LGS and TSC in
Japan in the first half of 2024;
the Company's expectations with respect to its products and product
candidates and the potential of the Company's products and product
candidates, including the potential of zanidatamab to transform the
current standard of care in multiple HER2-expressing cancers and
the potential regulatory path related thereto; expectations that
Xywav will remain the oxybate of choice; the Company's capital
allocation and corporate development strategy; the potential
successful future development, manufacturing, regulatory and
commercialization activities; the Company's expectation of
meaningful growth as part of its Vision 2025; growing and
diversifying the Company's revenue, investing in its pipeline of
novel therapies, and delivering innovative therapies for patients
and the potential benefits of such therapies; the Company's ability
to realize the commercial potential of its products; the Company's
net product sales and goals for net product sales from new and
acquired products; the Company's views and expectations relating to
its patent portfolio, including with respect to expected patent
protection, as well as expectations with respect to exclusivity;
planned or anticipated clinical trial events, including with
respect to initiations, enrollment and data read-outs, and the
anticipated timing thereof; the Company's clinical trials
confirming clinical benefit or enabling regulatory submissions;
planned or anticipated regulatory submissions and filings, and the
anticipated timing thereof; potential regulatory approvals; the
timing and amount of repurchases of the Company's ordinary shares;
settlements of the Notes; and other statements that are not
historical facts. These forward-looking statements are based on the
Company's current plans, objectives, estimates, expectations and
intentions and inherently involve significant risks and
uncertainties.
Actual results and the timing of events could differ materially
from those anticipated in such forward- looking statements as a
result of these risks and uncertainties, which include, without
limitation, risks and uncertainties associated with: maintaining or
increasing sales of and revenue from the Company's oxybate
products, Zepzelca, Rylaze and Epidiolex/Epidyolex and other key
marketed products; the introduction of new products into the U.S.
market that compete with, or otherwise disrupt the market for the
Company's oxybate products and product candidates; effectively
launching and commercializing the Company's other products and
product candidates; the successful completion of development and
regulatory activities with respect to the Company's product
candidates, obtaining and maintaining adequate coverage and
reimbursement for the Company's products; the time-consuming and
uncertain regulatory approval process, including the risk that the
Company's current and/or planned regulatory submissions may not be
submitted, accepted or approved by applicable regulatory
authorities in a timely manner or at all; the costly and
time-consuming pharmaceutical product development and the
uncertainty of clinical success, including risks related to failure
or delays in successfully initiating or completing clinical trials
and assessing patients; the Company's failure to realize the
expected benefits of its acquisition of GW Pharmaceuticals,
including the failure to realize the blockbuster potential of
Epidiolex; global economic, financial, and healthcare system
disruptions and the current and potential future negative impacts
to the Company's business operations and financial results;
geopolitical events, including the conflict between Russia and Ukraine and related sanctions; macroeconomic
conditions, including global financial markets, rising interest
rates and inflation and recent and potential banking disruptions;
regulatory initiatives and changes in tax laws; market volatility;
protecting and enhancing the Company's intellectual property rights
and the Company's commercial success being dependent upon the
Company obtaining, maintaining and defending intellectual property
protection for its products and product candidates; delays or
problems in the supply or manufacture of the Company's products and
product candidates; complying with applicable U.S. and non-U.S.
regulatory requirements, including those governing the research,
development, manufacturing and distribution of controlled
substances; government investigations, legal proceedings and other
actions; identifying and consummating corporate development
transactions, financing these transactions and successfully
integrating acquired product candidates, products and businesses;
the Company's ability to realize the anticipated benefits of its
corporate development transactions and its collaborations and
license agreements with third parties; the sufficiency of the
Company's cash flows and capital resources; the Company's ability
to achieve targeted or expected future financial performance and
results and the uncertainty of future tax, accounting and other
provisions and estimates; the Company's ability to meet its
projected long-term goals and objectives, including as part of
Vision 2025, in the time periods that the Company anticipates, or
at all, and the inherent uncertainty and significant judgments and
assumptions underlying the Company's long-term goals and
objectives; fluctuations in the market price and trading volume of
the Company's ordinary shares; restrictions on repurchases of
capital stock; the timing and availability of alternative
investment opportunities; the Company's ability to pay cash amounts
and issue ordinary shares due upon exchange of the Notes; and other
risks and uncertainties affecting the Company, including those
described from time to time under the caption "Risk Factors" and
elsewhere in Jazz Pharmaceuticals' Securities and Exchange
Commission filings and reports, including the Company's Annual
Report on Form 10-K for the year ended December 31, 2022, as supplemented by our
Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, and future filings and reports by
the Company. Other risks and uncertainties of which the Company is
not currently aware may also affect the Company's forward-looking
statements and may cause actual results and the timing of events to
differ materially from those anticipated.
JAZZ PHARMACEUTICALS
PLC
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(In thousands,
except per share amounts)
(Unaudited)
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Revenues:
|
|
|
|
|
|
|
|
Product sales,
net
|
$
938,398
|
|
$
935,766
|
|
$ 2,769,604
|
|
$ 2,673,903
|
Royalties and contract
revenues
|
33,742
|
|
4,886
|
|
52,665
|
|
13,348
|
Total
revenues
|
972,140
|
|
940,652
|
|
2,822,269
|
|
2,687,251
|
Operating
expenses:
|
|
|
|
|
|
|
|
Cost of product sales
(excluding amortization of
acquired developed technologies)
|
102,153
|
|
133,661
|
|
328,334
|
|
373,153
|
Selling, general and
administrative
|
308,310
|
|
358,478
|
|
947,071
|
|
1,033,764
|
Research and
development
|
234,402
|
|
148,870
|
|
633,050
|
|
417,898
|
Intangible asset
amortization
|
154,883
|
|
141,232
|
|
456,731
|
|
461,782
|
Acquired in-process
research and development
|
—
|
|
—
|
|
1,000
|
|
69,148
|
Impairment
charge
|
—
|
|
133,648
|
|
—
|
|
133,648
|
Total operating
expenses
|
799,748
|
|
915,889
|
|
2,366,186
|
|
2,489,393
|
Income from
operations
|
172,392
|
|
24,763
|
|
456,083
|
|
197,858
|
Interest expense,
net
|
(71,497)
|
|
(80,244)
|
|
(219,114)
|
|
(214,117)
|
Foreign exchange
loss
|
(1,377)
|
|
(4,649)
|
|
(566)
|
|
(16,532)
|
Income (loss) before
income tax benefit and equity in loss
(gain) of investees
|
99,518
|
|
(60,130)
|
|
236,403
|
|
(32,791)
|
Income tax
benefit
|
(47,176)
|
|
(43,027)
|
|
(86,823)
|
|
(58,603)
|
Equity in loss (gain)
of investees
|
(126)
|
|
2,545
|
|
2,548
|
|
9,148
|
Net income
(loss)
|
$
146,820
|
|
$
(19,648)
|
|
$
320,678
|
|
$
16,664
|
|
|
|
|
|
|
|
|
Net income (loss) per
ordinary share:
|
|
|
|
|
|
|
|
Basic
|
$
2.33
|
|
$
(0.31)
|
|
$
5.05
|
|
$
0.27
|
Diluted
|
$
2.14
|
|
$
(0.31)
|
|
$
4.67
|
|
$
0.26
|
Weighted-average
ordinary shares used in per share
calculations - basic
|
63,114
|
|
62,785
|
|
63,532
|
|
62,365
|
Weighted-average
ordinary shares used in per share
calculations - diluted
|
71,293
|
|
62,785
|
|
72,866
|
|
63,388
|
JAZZ PHARMACEUTICALS
PLC
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In
thousands)
(Unaudited)
|
|
|
September
30,
2023
|
|
December 31,
2022
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
1,335,690
|
|
$
881,482
|
Investments
|
250,000
|
|
—
|
Accounts receivable,
net of allowances
|
627,841
|
|
651,493
|
Inventories
|
611,827
|
|
714,061
|
Prepaid
expenses
|
109,990
|
|
91,912
|
Other current
assets
|
310,404
|
|
267,192
|
Total current
assets
|
3,245,752
|
|
2,606,140
|
Property, plant and
equipment, net
|
222,476
|
|
228,050
|
Operating lease
assets
|
65,038
|
|
73,326
|
Intangible assets,
net
|
5,417,860
|
|
5,794,437
|
Goodwill
|
1,705,320
|
|
1,692,662
|
Deferred tax assets,
net
|
464,367
|
|
376,247
|
Deferred financing
costs
|
7,172
|
|
9,254
|
Other non-current
assets
|
76,080
|
|
55,139
|
Total assets
|
$
11,204,065
|
|
$ 10,835,255
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
109,850
|
|
$
90,758
|
Accrued
liabilities
|
769,942
|
|
803,255
|
Current portion of
long-term debt
|
604,507
|
|
31,000
|
Income taxes
payable
|
89,026
|
|
7,717
|
Deferred
revenue
|
4
|
|
463
|
Total current
liabilities
|
1,573,329
|
|
933,193
|
Long-term debt, less
current portion
|
5,110,757
|
|
5,693,341
|
Operating lease
liabilities, less current portion
|
61,892
|
|
71,838
|
Deferred tax
liabilities, net
|
841,234
|
|
944,337
|
Other non-current
liabilities
|
127,480
|
|
106,812
|
Total shareholders'
equity
|
3,489,373
|
|
3,085,734
|
Total liabilities and
shareholders' equity
|
$
11,204,065
|
|
$ 10,835,255
|
JAZZ PHARMACEUTICALS
PLC
SUMMARY OF CASH
FLOWS
(In
thousands)
(Unaudited)
|
|
|
Nine Months
Ended
September
30,
|
|
2023
|
|
2022
|
Net cash provided by
operating activities
|
$
924,668
|
|
$
930,006
|
Net cash used in
investing activities
|
(264,860)
|
|
(121,852)
|
Net cash used in
financing activities
|
(204,948)
|
|
(549,087)
|
Effect of exchange
rates on cash and cash equivalents
|
(652)
|
|
(11,157)
|
Net increase in cash
and cash equivalents
|
$
454,208
|
|
$
247,910
|
JAZZ PHARMACEUTICALS
PLC
RECONCILIATIONS OF
GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION
(In thousands,
except per share amounts)
(Unaudited)
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Net
Income
|
|
Diluted
EPS
|
|
Net Income
(Loss)
|
|
Diluted
EPS
|
|
Net
Income
|
|
Diluted
EPS
|
|
Net
Income
|
|
Diluted
EPS
|
GAAP
reported1
|
$
146,820
|
|
$
2.14
|
|
$
(19,648)
|
|
$
(0.31)
|
|
$
320,678
|
|
$
4.67
|
|
$
16,664
|
|
$
0.26
|
Intangible asset
amortization
|
154,883
|
|
2.17
|
|
141,232
|
|
1.94
|
|
456,731
|
|
6.27
|
|
461,782
|
|
6.38
|
Share-based
compensation
expense
|
56,115
|
|
0.79
|
|
54,948
|
|
0.75
|
|
173,900
|
|
2.39
|
|
156,427
|
|
2.16
|
Acquisition
accounting
inventory fair value step-up
|
30,822
|
|
0.43
|
|
70,964
|
|
0.97
|
|
119,094
|
|
1.63
|
|
203,189
|
|
2.81
|
Restructuring and
other
costs2
|
—
|
|
—
|
|
57,625
|
|
0.79
|
|
23,488
|
|
0.32
|
|
57,625
|
|
0.80
|
Non-cash interest
expense3
|
6,062
|
|
0.09
|
|
14,262
|
|
0.20
|
|
16,255
|
|
0.23
|
|
32,002
|
|
0.44
|
Impairment
charge4
|
—
|
|
—
|
|
133,648
|
|
1.83
|
|
—
|
|
—
|
|
133,648
|
|
1.85
|
(Income) costs related
to
disposal of a business5
|
—
|
|
—
|
|
(671)
|
|
(0.01)
|
|
—
|
|
—
|
|
49,539
|
|
0.68
|
Transaction and
integration
related expenses6
|
—
|
|
—
|
|
5,491
|
|
0.08
|
|
—
|
|
—
|
|
23,560
|
|
0.33
|
Income tax effect of
above
adjustments
|
(54,554)
|
|
(0.77)
|
|
(87,413)
|
|
(1.20)
|
|
(159,608)
|
|
(2.19)
|
|
(196,599)
|
|
(2.71)
|
Effect of assumed
conversion
of Exchangeable Senior
Notes
|
—
|
|
(0.01)
|
|
—
|
|
0.13
|
|
—
|
|
(0.03)
|
|
—
|
|
0.21
|
Non-GAAP
adjusted1
|
$
340,148
|
|
$
4.84
|
|
$
370,438
|
|
$
5.17
|
|
$
950,538
|
|
$ 13.29
|
|
$
937,837
|
|
$ 13.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
ordinary
shares used in diluted per
share calculations - GAAP
|
71,293
|
|
|
|
62,785
|
|
|
|
72,866
|
|
|
|
63,388
|
|
|
Dilutive effect of
Exchangeable Senior Notes1
|
—
|
|
|
|
9,044
|
|
|
|
—
|
|
|
|
9,044
|
|
|
Dilutive effect of
employee
equity incentive and purchase
plans
|
—
|
|
|
|
1,031
|
|
|
|
—
|
|
|
|
—
|
|
|
Weighted-average
ordinary
shares used in diluted per share
calculations - non-GAAP
|
71,293
|
|
|
|
72,860
|
|
|
|
72,866
|
|
|
|
72,432
|
|
|
|
|
|
|
|
|
|
Explanation of
Adjustments and Certain Line Items:
|
|
1.
|
Diluted EPS was
calculated using the "if-converted" method in relation to the 1.50%
exchangeable senior notes due 2024, or 2024 Notes and the 2.00%
exchangeable senior notes due 2026, or 2026 Notes, which we refer
to collectively as the Exchangeable Senior Notes. In August
2023, we made an irrevocable election to fix the settlement method
for exchanges of the 2024 Notes to a combination of cash and
ordinary shares of the Company with a specified cash amount per
$1,000 principal amount of the 2024 Notes of $1,000. As a
result, the assumed issuance of ordinary shares upon exchange of
the 2024 Notes has only been included in the calculation of diluted
net income per ordinary share, on a GAAP and on a non-GAAP adjusted
basis, in the three and nine months ended September 30, 2023 up to
the date the irrevocable election was made. GAAP reported net
income per diluted share for the three and nine months ended
September 30, 2023 included 7.6 million shares and 8.5 million
shares, respectively, related to the assumed conversion of the
Exchangeable Senior Notes and the associated interest expense
add-back to GAAP net income of $5.9 million and $20.0 million,
respectively. There was no impact on GAAP reported net income
(loss) per diluted share for the three and nine months ended
September 30, 2022, as the Exchangeable Senior Notes were
anti-dilutive. Non-GAAP adjusted net income per diluted share for
the three and nine months ended September 30, 2023 included 7.6
million shares and 8.5 million shares, respectively, related to the
assumed conversion of the Exchangeable Senior Notes and the
associated interest expense add-back to non-GAAP adjusted net
income of $5.2 million and $17.8 million, respectively.
Non-GAAP adjusted net income per diluted share for the three and
nine months ended September 30, 2022 included 9.0 million shares
related to the assumed conversion of the Exchangeable Senior Notes
and the associated interest expense add-back to non-GAAP adjusted
net income of $6.3 million and $18.9 million,
respectively.
|
2.
|
Includes restructuring
and costs related to program terminations.
|
3.
|
Non-cash interest
expense associated with debt issuance costs.
|
4.
|
Impairment charge
related to the IPR&D asset impairment following the
discontinuation of our nabiximols program.
|
5.
|
Loss on disposal of
Sunosi to Axsome Therapeutics Inc. and associated costs.
|
6.
|
Transaction and
integration expenses related to the acquisition of GW
Pharmaceuticals plc.
|
JAZZ PHARMACEUTICALS
PLC
RECONCILIATIONS OF
GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS -
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2023 and
2022
(In thousands,
except percentages)
(Unaudited)
|
|
|
Three months ended
September 30, 2023
|
|
Cost of
product
sales
|
|
Gross
margin
|
|
Selling,
general and
administrative
|
|
Research
and
development
|
|
Intangible
asset
amortization
|
|
Interest
expense, net
|
|
Income tax
expense
(benefit)
|
|
Effective
tax rate(1)
|
GAAP
Reported
|
$
102,153
|
|
89.1 %
|
|
$ 308,310
|
|
$
234,402
|
|
$
154,883
|
|
$
71,497
|
|
$
(47,176)
|
|
(47.4) %
|
Non-GAAP
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible asset
amortization
|
—
|
|
—
|
|
—
|
|
—
|
|
(154,883)
|
|
—
|
|
—
|
|
—
|
Share-based
compensation expense
|
(4,212)
|
|
0.5
|
|
(35,268)
|
|
(16,635)
|
|
—
|
|
—
|
|
—
|
|
—
|
Acquisition accounting
inventory
fair value step-up
|
(30,822)
|
|
3.2
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Non-cash interest
expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(6,062)
|
|
—
|
|
—
|
Income tax effect of
above
adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
54,554
|
|
49.5
|
Total of
non-GAAP adjustments
|
(35,034)
|
|
3.7
|
|
(35,268)
|
|
(16,635)
|
|
(154,883)
|
|
(6,062)
|
|
54,554
|
|
49.5
|
Non-GAAP
Adjusted
|
$
67,119
|
|
92.8 %
|
|
$ 273,042
|
|
$
217,767
|
|
$
—
|
|
$
65,435
|
|
$ 7,378
|
|
2.1 %
|
|
Three months ended
September 30, 2022
|
|
Cost of
product
sales
|
|
Gross
margin
|
|
Selling,
general and
administrative
|
|
Research
and
development
|
|
Intangible
asset
amortization
|
|
Impairment
charge
|
|
Interest
expense,
net
|
|
Income tax
expense
(benefit)
|
|
Effective
tax rate(1)
|
GAAP
Reported
|
$
133,661
|
|
85.7 %
|
|
$ 358,478
|
|
$
148,870
|
|
$
141,232
|
|
$
133,648
|
|
$
80,244
|
|
$
(43,027)
|
|
71.6 %
|
Non-GAAP
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible asset
amortization
|
—
|
|
—
|
|
—
|
|
—
|
|
(141,232)
|
|
—
|
|
—
|
|
—
|
|
—
|
Share-based
compensation expense
|
(3,160)
|
|
0.3
|
|
(35,890)
|
|
(15,898)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Impairment
charge
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(133,648)
|
|
—
|
|
—
|
|
—
|
Income related to
the
disposal of a business
|
—
|
|
—
|
|
671
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Restructuring and
other
costs
|
(2,359)
|
|
0.3
|
|
(43,375)
|
|
(11,891)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Transaction and
integration related costs
|
(75)
|
|
—
|
|
(5,137)
|
|
(279)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Non-cash interest
expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(14,262)
|
|
—
|
|
—
|
Acquisition
accounting
inventory fair value step-
up
|
(70,964)
|
|
7.6
|
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
—
|
|
—
|
Income tax effect
of
above adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
87,413
|
|
(61.0)
|
Total of
non-GAAP
adjustments
|
(76,558)
|
|
8.2
|
|
(83,731)
|
|
(28,068)
|
|
(141,232)
|
|
(133,648)
|
|
(14,262)
|
|
87,413
|
|
(61.0)
|
Non-GAAP
Adjusted
|
$
57,103
|
|
93.9 %
|
|
$ 274,747
|
|
$
120,802
|
|
$
—
|
|
$
—
|
|
$ 65,982
|
|
$
44,386
|
|
10.6 %
|
|
|
|
|
|
|
(1)
|
The GAAP effective tax
rate decreased in the three months ended September 30, 2023
compared to the same period in 2022, primarily due to the mix of
pre-tax income and losses across tax jurisdictions and the impact
of the nabiximols impairment, which was recognized in
2022.
|
JAZZ PHARMACEUTICALS
PLC
RECONCILIATIONS OF
GAAP REPORTED TO NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS -
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 and
2022
(In thousands,
except percentages)
(Unaudited)
|
|
|
Nine months ended
September 30, 2023
|
|
Cost of
product
sales
|
|
Gross
margin
|
|
Selling,
general and
administrative
|
|
Research
and
development
|
|
Intangible
asset
amortization
|
|
Acquired
IPR&D
|
|
Interest
expense,
net
|
|
Income tax
expense
(benefit)
|
|
Effective
tax rate
(1)
|
GAAP
Reported
|
$
328,334
|
|
88.1 %
|
|
$ 947,071
|
|
$
633,050
|
|
$
456,731
|
|
$
1,000
|
|
$
219,114
|
|
$
(86,823)
|
|
(36.7) %
|
Non-GAAP
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible asset
amortization
|
—
|
|
—
|
|
—
|
|
—
|
|
(456,731)
|
|
—
|
|
—
|
|
—
|
|
—
|
Share-based
compensation
expense
|
(11,399)
|
|
0.4
|
|
(113,155)
|
|
(49,346)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Restructuring and
other
costs
|
—
|
|
—
|
|
(23,488)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Non-cash interest
expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(16,255)
|
|
—
|
|
—
|
Acquisition
accounting
inventory fair value step-up
|
(119,094)
|
|
4.4
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Income tax effect of
above
adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
159,608
|
|
43.8
|
Total of
non-GAAP
adjustments
|
(130,493)
|
|
4.8
|
|
(136,643)
|
|
(49,346)
|
|
(456,731)
|
|
—
|
|
(16,255)
|
|
159,608
|
|
43.8
|
Non-GAAP
Adjusted
|
$ 197,841
|
|
92.9 %
|
|
$ 810,428
|
|
$
583,704
|
|
$
—
|
|
$
1,000
|
|
$ 202,859
|
|
$
72,785
|
|
7.1 %
|
|
Nine months ended
September 30, 2022
|
|
Cost of
product
sales
|
|
Gross
margin
|
|
Selling,
general and
administrative
|
|
Research
and
development
|
|
Intangible
asset
amortization
|
|
Acquired
IPR&D
|
|
Impairment
charge
|
|
Interest
expense,
net
|
|
Income tax
expense
(benefit)
|
|
Effective
tax rate
(1)
|
GAAP
Reported
|
$
373,153
|
|
86.0 %
|
|
$
1,033,764
|
|
$
417,898
|
|
$
461,782
|
|
$
69,148
|
|
$
133,648
|
|
$
214,117
|
|
$
(58,603)
|
|
178.7 %
|
Non-GAAP
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible asset
amortization
|
—
|
|
—
|
|
—
|
|
—
|
|
(461,782)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Share-based
compensation
expense
|
(8,581)
|
|
0.3
|
|
(104,851)
|
|
(42,995)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Impairment
charge
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(133,648)
|
|
—
|
|
—
|
|
—
|
Costs related to
the disposal of a
business
|
—
|
|
—
|
|
(49,539)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Restructuring
and other costs
|
(2,359)
|
|
0.1
|
|
(43,375)
|
|
(11,891)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Transaction and
integration
related costs
|
(470)
|
|
—
|
|
(21,058)
|
|
(2,032)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Non-cash
interest expense
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(32,002)
|
|
—
|
|
—
|
Acquisition
accounting
inventory fair
value step-up
|
(203,189)
|
|
7.7
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
—
|
|
—
|
Income tax effect
of above
adjustments
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
196,599
|
|
(166.0)
|
Total of
non-
GAAP
adjustments
|
(214,599)
|
|
8.1
|
|
(218,823)
|
|
(56,918)
|
|
(461,782)
|
|
—
|
|
(133,648)
|
|
(32,002)
|
|
196,599
|
|
(166.0)
|
Non-GAAP
Adjusted
|
$
158,554
|
|
94.1 %
|
|
$ 814,941
|
|
$
360,980
|
|
$
—
|
|
$
69,148
|
|
$
—
|
|
$
182,115
|
|
$
137,996
|
|
12.7 %
|
|
|
|
|
|
|
|
(1)
|
The GAAP effective tax
rate decreased in the nine months ended September 30, 2023 compared
to the same period in 2022, primarily due to the mix of pre-tax
income and losses across tax jurisdictions and the impact of both
the Sunosi divestment in 2022 and the nabiximols impairment,
which was recognized in 2022.
|
JAZZ PHARMACEUTICALS
PLC
RECONCILIATION OF
GAAP TO NON-GAAP ADJUSTED 2023 NET INCOME AND DILUTED EPS
GUIDANCE
(In millions, except
per share amounts)
(Unaudited)
|
|
|
Net
Income
|
|
Diluted
EPS
|
GAAP
guidance
|
$450 -
$565
|
|
$6.60 -
$8.15
|
Intangible asset
amortization
|
580 - 615
|
|
8.00 - 8.50
|
Acquisition accounting
inventory fair value step-up
|
135 - 155
|
|
1.85 - 2.15
|
Share-based
compensation expense
|
230 - 250
|
|
3.20 - 3.45
|
Restructuring and
other costs
|
23
|
|
0.30
|
Non-cash interest
expense
|
20 - 30
|
|
0.30 - 0.40
|
Income tax effect of
above adjustments
|
(215) -
(230)
|
|
(2.95) -
(3.20)
|
Effect of assumed
conversion of Exchangeable Senior Notes
|
-
|
|
(0.05)
|
Non-GAAP
guidance
|
$1,290 -
$1,340
|
|
$18.15 -
$19.00
|
|
|
|
|
Weighted-average
ordinary shares used in per share calculations - GAAP and non-
GAAP
|
72
|
|
|
Contacts:
Investors:
Andrea N.
Flynn, Ph.D.
Vice President, Head, Investor Relations
Jazz Pharmaceuticals plc
InvestorInfo@jazzpharma.com
Ireland +353 1 634 3211
U.S. +1 650 496 2717
Media:
Kristin
Bhavnani
Head of Global Corporate Communications
Jazz Pharmaceuticals plc
CorporateAffairsMediaInfo@jazzpharma.com
Ireland +353 1 637 2141
U.S. +1 215 867 4948
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