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Incyte Reports 2016 First-Quarter Financial Results and Updates Shareholders on Key Clinical Programs

WILMINGTON, Del.--(BUSINESS WIRE)--

Incyte Corporation (INCY) today reported 2016 first-quarter financial results, including strong revenue growth driven by increased Jakafi® (ruxolitinib) sales in the U.S. as well as continued growth in ex-U.S. Jakavi® (ruxolitinib) royalties from Novartis.

Incyte’s broad portfolio of development candidates includes immuno-oncology as well as targeted anti-cancer therapies and is made up of both small and large molecules. The recent presentations at the 2016 annual meeting of the American Association of Cancer Research (AACR) showcased the depth of Incyte’s discovery and development expertise, including both monotherapy and combination therapy approaches.

As also announced today, Incyte has agreed to acquire the European operations of ARIAD Pharmaceuticals and the development and commercialization rights to Iclusig® (ponatinib) in Europe. The acquisition of a fully-integrated and established pan-European team, including medical, sales and marketing personnel, will help Incyte optimize clinical development and maximize the potential of future European launches for its portfolio of products.

“Incyte has a unique profile within the biopharmaceutical industry. Our revenue growth and the underlying demand for Jakafi are strong, and we also have the potential for a second important source of revenue should baricitinib be approved in 2017,” stated Hervé Hoppenot, Incyte’s Chief Executive Officer. “We have a fast-moving and rapidly expanding portfolio of exciting development projects, and we also look forward to the initiation of two new pivotal programs – epacadostat for the 1st line treatment of advanced melanoma and ruxolitinib for the treatment of graft versus host disease – during 2016.”

2016 First-Quarter Financial Results

Revenues For the quarter ended March 31, 2016, net product revenues of Jakafi were $183 million as compared to $115 million for the same period in 2015, representing 59 percent growth. For the quarter ended March 31, 2016, product royalties from sales of Jakavi outside of the United States received from Novartis were $22 million as compared to $16 million for the same period in 2015. For the quarter ended March 31, 2016, contract revenues were $58 million as compared to $28 million for the same period in 2015. We earned $55 million in milestone payments from Lilly during the quarter ended March 31, 2016 and a $25 million milestone payment from Novartis during the quarter ended March 31, 2015. For the quarter ended March 31, 2016, total revenues were $263 million as compared to $159 million for the same period in 2015.

Year Over Year Revenue Growth
(in thousands, unaudited)
Three Months Ended
March 31, %
2016 2015 Change
Revenues:
Jakafi net product revenue $ 183,267 $ 115,330 59%
Product royalty revenues 21,903 15,673 40%
Contract revenues 58,214 28,214 -
Other revenues 80 58 -
Total revenues $ 263,464 $ 159,275

Research and development expenses Research and development expenses for the quarter ended March 31, 2016 were $157 million as compared to $118 million for the same period in 2015. Included in research and development expenses for the quarter ended March 31, 2016 is the previously announced $35 million upfront payment to acquire the rights from Lilly to develop ruxolitinib for the treatment of patients with GVHD and non-cash expenses related to equity awards to our employees of $13 million. In addition to the $35 million upfront payment to Lilly, the increase in research and development expenses was primarily due to the expansion of the Company’s clinical portfolio.

Selling, general and administrative expenses Selling, general and administrative expenses for the quarter ended March 31, 2016 were $65 million as compared to $45 million for the same period in 2015. Included in selling, general and administrative expenses for the quarter ended March 31, 2016 were non-cash expenses related to equity awards to our employees of $8 million. Increased selling, general and administrative expenses are driven primarily by additional costs related to the commercialization of Jakafi.

Unrealized loss on long term investment Unrealized loss on long term investment of $3 million for the quarter ended March 31, 2016 represents the fair market value adjustments of the Company’s investment in Agenus.

Net income / (loss) Net income for the quarter ended March 31, 2016 was $24 million, or $0.13 per basic and $0.12 per diluted share, as compared to net loss of $18 million, or $0.11 per basic and diluted share for the same period in 2015.

Cash, cash equivalents and marketable securities position As of March 31, 2016, cash, cash equivalents and marketable securities totaled $811 million, as compared to $708 million as of December 31, 2015.

2016 Financial Guidance

The Company has updated its full year 2016 financial guidance, as detailed below.

Incyte

ARIAD EU

Combined

Jakafi net product revenues

$815-$830 million
(previously $800-$815 million)
- $815-$830 million

Iclusig net product revenues

- $25-$30 million $25-$30 million

Research and development expenses

$620-$640 million
(no change)
$15-$20 million $635-$660 million

Selling, general and administrative expenses

$255-$275 million
(previously $255-$270 million)
$30-$35 million $285-$310 million

Corporate Update

In May 2016, Dr. Vijay Iyengar joined the Incyte Executive Management team as Head of Global Product Strategy, a position from which he will also lead Incyte’s business development, licensing and strategic planning teams. Vijay was previously President, Genoptix Corporation, a Novartis Company, and has significant international biopharma experience in building and managing teams in the U.S. and in Europe.

Portfolio Update

Targeted Cancer Therapies

In April, preliminary data from an open-label Phase 1 dose escalation trial of INCB50465, Incyte’s second-generation, highly selective PI3K delta inhibitor, was presented at AACR 2016. INCB50465 showed promising efficacy in...


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