August 08, 2016 4:05pm EDT
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Net income was $15.5 million and $3.6 million for the three and six
months ended June 30, 2016 compared to net losses of $42.8 million and
$159.9 million for the comparable periods of 2015
Consolidated revenue increased to $357.1 million from $42.4 million
and to $648.1 million from $72.5 million for the three and six months
ended June 30, 2016 compared to the 2015 periods
Entered into collaboration and license agreement with Vifor
Fresenius Medical Care Renal Pharma (VFMCRP) for OPKO’s RAYALDEE ® .
OPKO to receive up to $282 million in upfront and milestone
payments, and tiered double digit royalties; Vifor Fresenius also
acquired an option for rights to the U.S. dialysis market for a new
dosage form of RAYALDEE which provides for payment to OPKO of
up to $555 million in additional milestone payments plus double digit
royalties if exercised
The U.S. Food and Drug Administration (FDA) approved RAYALDEE ;
launch anticipated in Q4 2016
Signed agreement to acquire Transition Therapeutics; closing
expected in Q3 2016
4Kscore test utilization continues to grow;
reimbursement negotiations underway
MIAMI--(BUSINESS WIRE)--
OPKO Health, Inc. (NYSE:OPK) , reports financial and operating
results for the three and six months ended June 30, 2016.
Financial Highlights
Consolidated revenues for the three months ended June 30, 2016
increased to $357.1 million from $42.4 million for the three months
ended June 30, 2015. The 2016 period includes revenue from
BioReference Laboratories and EirGen which were acquired in August and
May 2015, respectively. In addition, the 2016 period includes $50.0
million of revenue related to our license of RAYALDEE to VFMCRP.
Net income for the three months ended June 30, 2016 was $15.5 million
compared with net loss of $42.8 million for the 2015 period. Net
income (loss) during the three month periods include significant
Upfront payment for the license of RAYALDEE to VFMCRP of
$50.0 million; and
Other income and (expense) was $5.1 million and ($16.8) million in
the 2016 and 2015 periods, respectively, primarily related to the
change in fair value of derivative instruments. The change in fair
value is principally related to an embedded derivative in OPKO’s
January 2013 convertible senior notes due in 2033.
Cash, cash equivalents and marketable securities were $171.6 million
as of June 30, 2016.
Business Highlights
VFMCRP and OPKO Health Enter into License and Option Agreement for
OPKO’s RAYALDEE : OPKO entered into an agreement with VFMCRP
for the development and commercialization of RAYALDEE in
Europe, Canada, Mexico, Australia, South Korea and certain other
international markets for the treatment of secondary
hyperparathyroidism (SHPT) in patients with chronic kidney disease
(CKD) and vitamin D insufficiency. Under the terms of the agreement,
OPKO received an upfront payment of $50 million, and will receive up
to $232 million in regulatory and sales based milestones. In addition,
VFMCRP will pay OPKO tiered, double digit royalties on sales of the
product. OPKO and VFMCRP will also collaborate to develop and
commercialize a new dosage form of RAYALDEE for the treatment
of SHPT in dialysis patients. OPKO granted VFMCRP an option to acquire
rights to this dosage form for the US market; if exercised, OPKO will
receive up to $555 million in additional milestones and double digit
royalties.
RAYALDEE Approved in June 2016: The FDA approved RAYALDEE
extended release capsules for the treatment of secondary
hyperparathyroidism (SHPT) in adults with stage 3 or 4 chronic kidney
disease (CKD) and serum total 25-hydroxyvitamin D levels less than 30
ng/mL. RAYALDEE is a patented extended release product
containing 30 mcg of a prohormone called calcifediol
(25-hydroxyvitamin D3).
Transition Therapeutics: The acquisition of Transition
Therapeutics Inc. (NASDAQ: TTHI, TSX: TTH), a Toronto based
biotechnology company, is expected to close during the third quarter
of 2016. Transition Therapeutics has two drugs in mid-stage clinical
development; TT401, a long acting GLP-1/glucagon dual agonist for the
treatment of type 2 diabetes and obesity; and TT701, an orally
administered selective androgen receptor modulator (SARM) being
developed for the treatment of certain features of androgen deficiency
without androgenic effects on the prostate gland.
reimbursement coverage negotiations continued: Reimbursement of
the 4Kscore test is progressing; pricing agreements are already
in place with several payors, and the Company is working to obtain a
positive coverage decision by its local Medicare administrator.
Through June 30, 2016, over 5,000 clinicians have utilized the test
and in the month of June, alone, over 5,300 4Kscore tests were
performed.
“Our improved financial performance this quarter was fueled by continued
growth in our diagnostics business through increases in patient volume
at BioReference Laboratories and its GeneDx unit, as well as continued
growth in the utilization of our innovative 4Kscore test for
predicting the probability of aggressive prostate cancer,” stated
Phillip Frost, M.D., Chairman and Chief Executive Officer of OPKO. “We
were pleased with the FDA’s decision to approve RAYALDEE before
its PDUFA date, and we are building an impressive commercial team to
make this important medicine available to the large number of chronic
kidney disease patients suffering from SHPT. Other drug development
programs are progressing well and we anticipate having topline data from
our phase 3 clinical trial for long acting human growth hormone in
adults later this year. We also anticipate clinical data late this year
or early next year for our long acting Factor VIIa-CTP, as well as
clinical data for our Phase 1 clinical trial for long acting
oxyntomodulin. We look forward to the closing of the Transition
Therapeutics acquisition and adding Transition’s important products to
our robust late stage drug pipeline,” continued Dr. Frost.
OPKO’s senior management will provide a business update and discuss
results in greater detail in a conference call and live audio webcast at
4:30 p.m. Eastern time today.
The conference call dial in information is listed below. To access the
webcast, please log on to the OPKO website at www.opko.com .
WHEN: Monday, August 8, 2016, 4:30 p.m. ET
DOMESTIC DIAL-IN: (866)
INTERNATIONAL DIAL-IN: (330) 863-3454
For those unable to participate in the conference call or webcast, a
replay will be available beginning August 8, 2016 at 7:30 p.m. ET for a
period of time. To access the replay, dial (855) 859-2056 or (404)
537-3406. The replay passcode is: 56394307.
The replay can also be accessed for a period of time on OPKO’s website
at www.opko.com .
About OPKO Health, Inc.
OPKO Health, Inc. is a diversified healthcare company that seeks to
establish industry-leading positions in large, rapidly growing markets.
Our diagnostics business includes Bio-Reference Laboratories, the
nation's third-largest clinical laboratory with a core genetic testing
business and a 420-person sales force to drive growth and leverage new
products, including the 4Kscore prostate cancer test and the Claros
1 in-office immunoassay platform. Our pharmaceutical business
features RAYALDEE , an FDA approved treatment for SHPT in stage
3-4 CKD patients with vitamin D insufficiency, and VARUBI™ for
chemotherapy-induced nausea and vomiting (oral formulation launched by
partner Tesaro and IV formulation PDUFA is January 2017). Our biologics
business includes hGH-CTP, a once-weekly human growth hormone injection
(in Phase 3 and partnered with Pfizer), a long-acting Factor VIIa drug
for hemophilia (in Phase 2a) and a long acting oxyntomodulin for
diabetes and obesity (in Phase 1). We also have production and
distribution assets worldwide, multiple strategic investments and an
active business development strategy. More information is available at www.opko.com .
Cautionary Statement Regarding Forward-Looking Statements
This press release contains "forward-looking statements," as that
term is defined under the Private Securities Litigation Reform Act of
1995 (PSLRA), which statements may be identified by words such as
"expects," "plans," "projects," "will," "may," "anticipates,"
"believes," "should," "intends," "estimates," and other words of similar
meaning, including statements regarding expected financial performance,
our product development efforts and the expected benefits of our
products, including whether our ongoing and future clinical trials will
be completed on a timely basis or at all and whether the data from any
of our trials will support approval, validation and/or reimbursement for
our products, the expected timing for launch of our products in
development, including RAYALDEE and hGH-CTP, the expected timing of our
clinical trials, enrollment in clinical trials, and disclosure of
results for the trials, the timing of completion for our trials, our
ability to market and sell any of our products in development, including
RAYALDEE, the 4Kscore, and hGH-CTP, expectations about potential
milestone payments and royalties from our partners, our ability to
obtain broad reimbursement coverage for the 4Kscore test, increased
adoption rates for the 4Kscore by Urologists, our ability to increase
the number of 4Kscore tests performed, and expectations about the
Transition acquisition, including the closing date, as well as other
non-historical statements about our expectations, beliefs or intentions
regarding our business, technologies and products, financial condition,
strategies or prospects. Many factors could cause our actual activities
or results to differ materially from the activities and results
anticipated in forward-looking statements. These factors include those
described in our Annual Reports on Form 10-K filed and to be filed with
the Securities and Exchange Commission and in our other filings with the
Securities and Exchange Commission, as well as integration challenges
for Bio-Reference, EirGen, Transition, and other acquired businesses,
the risks inherent in funding, developing and obtaining regulatory
approvals of new, commercially-viable and competitive products and
treatments, that earlier clinical results of effectiveness and safety
may not be reproducible or indicative of future results, that the
4Kscore, RAYALDEE, Varubi™, hGH-CTP, and/or any of our compounds or
diagnostic products under development may fail, may not achieve the
expected results or effectiveness and may not generate data that would
support the approval or marketing of products for the indications being
studied or for other indications, that currently available
over-the-counter and prescription products, as well as products under
development by others, may prove to be as or more effective than our
products for the indications being studied. In addition, forward-looking
statements may also be adversely affected by general market factors,
competitive product development, product availability, federal and state
regulations and legislation, the regulatory process for new products and
indications, manufacturing issues that may arise, patent positions and
litigation, among other factors. The forward-looking statements
contained in this press release speak only as of the date the statements
were made, and we do not undertake any obligation to update
forward-looking statements. We intend that all forward-looking
statements be subject to the safe-harbor provisions of the PSLRA.
OPKO Health, Inc. and Subsidiaries
Condensed Consolidated
Balance Sheets
(unaudited)
(in millions)
As of
June 30,
December 31,
Cash, cash equivalents and marketable securities
$
171.6
$
193.6
Other current assets
334.0
260.5
Total Current Assets
505.6
454.1
In-process Research and Development and Goodwill
1,297.1
1,535.6
Other assets
971.3
809.5
Total Assets
$
2,774.0
$
2,799.2
Current liabilities
$
281.2
$
251.9
2033 Senior Notes, net
45.2
49.0
Deferred tax liabilities
207.6
226.0
Other long-term liabilities, principally deferred revenue and
contingent consideration
224.4
292.5
Total Liabilities
758.4
819.4
Equity
2,015.6
1,979.8
Total Liabilities and Equity
Statements of Operations
except per share data)
For the three months ended
June 30,
For the six months ended
June 30,
Revenues
Revenue from services
$
266.0
$
1.9
$
518.5
$
4.0
Revenue from products
22.8
22.8
42.7
38.3
Revenue from transfer of intellectual property
68.3
17.7
86.9
30.2
Total revenues
357.1
42.4
648.1
72.5
Costs and expenses
Cost of revenues
153.4
14.4
301.0
24.7
Selling, general and administrative
117.5
20.9
245.5
38.4
Research and development
31.3
29.6
59.1
55.1
Contingent consideration
10.8
(0.3)
12.5
4.8
Amortization of intangible assets
15.8
3.2
29.2
5.9
Grant repayment
25.9
Total Costs and expenses
328.8
67.8
647.3
154.8
Operating income (loss)
28.3
(25.4)
0.8
(82.3)
Other income and (expense), net
5.1
(16.8)
2.5
(70.6)
Income (loss) before income taxes and investment losses
33.4
(42.2)
3.3
(152.9)
(Provision for) benefit from income taxes
(15.9)
(0.3)
4.6
(5.8)
Income (loss) before investment losses
17.5
(42.5)
7.9
(158.7)
Loss from investments in investees
(2.0)
(0.8)
(4.3)
(2.6)
Net income (loss)
15.5
(43.3)
3.6
(161.3)
Less: Net loss attributable to non-controlling interests
-
(0.5)
-
(1.4)
Net income (loss) attributable to common shareholders
( 42.8)
(159.9)
Basic income (loss) per share
$
0.03
$
(0.09)
$
0.01
$
(0.35)
Diluted income (loss) per share
$
0.02
0.00
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