On April 27, 2021 Astellas Pharma Inc. (TSE: 4503, President and CEO: Kenji Yasukawa, "the Company") reported the financial results for fiscal year 2020 (FY2020) ended March 31, 2021 (Press release, Astellas, APR 27, 2021, View Source [SID1234578523]).
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
Consolidated financial results (core basis) in FY2020 are shown in the table below. Revenue, core operating profit and core profit for the year decreased across the board Revenue-Sales of main products XTANDI for the treatment of prostate cancer and XOSPATA for the treatment of acute myeloid leukemia continued to grow.
In addition, growth of the co-promotion revenue of PADCEV for the treatment of urothelial cancer contributed to revenue.-Moreover, sales of Betanis / Myrbetriq / BETMIGA for the treatment of overactive bladder ("OAB") showed steady progress, and new product group in Japan achieved sales growth, including those of EVENITY for the treatment of osteoporosis, Suglat and SUJANU Combination Tablets for the treatment of diabetes mellitus.-However, revenue decreased mainly due to the loss of market exclusivity of Vesicare for the treatment of OAB in Europe, and the termination of sales agreements for Symbicort for the treatment of asthma, human vaccines of KM Biologics Co., Ltd., Micardis family for the treatment of hypertension, and Celecox for the treatment of inflammation and pain in Japan.
Sales were also negatively impacted due to the spread of COVID-19. As a result of the above, revenue in FY2020 decreased by 3.9% compared to those in the previous fiscal year ("year-on-year") to ¥1,249.5 billion. Core operating profit/ Core profit for the year-Gross profit decreased by 2.0% year-on-year to ¥1,003.5 billion. The cost-to-revenue ratio fell by 1.6 percentage points year-on-year to 19.7%, mainly due to changes in product mix.-Selling, general and administrative expenses increased by 1.0% year-on-year to ¥504.3 billion.
There were factors causing a decrease in expenses, including the promotion of the efficient use of expenses and optimization of resource allocation, and also refraining from promotional activities, etc. because of the spread of COVID-19.
Overall, however, total selling, general and administrative expenses slightly increased due to the increase of co-promotion fees associated with the growth of sales of XTANDI in the United States, and also there was a one-off reducing factor on expenses from a reversal of loss allowances in the previous year.-Research and development (R&D) expenses stayed almost flat, showing a 0.1% increase year-on-year to ¥224.5 billion. There was a decrease in development expenses due to the impact of the spread of COVID-19 on the execution of a portion of clinical trials, but total R&D expenses were in the same range as those for the previous fiscal year due to an increase in development expenses for key post-POC pipeline projects, and the addition of R&D expenses from Audentes Therapeutics, Inc.
The R&D cost-to-revenue ratio was up 0.7 percentage points year-on-year to 18.0%.-Amortisation of intangible assets increased by 12.3% year-on-year to ¥23.8 billion. As a result of the above, core operating profit decreased by 9.5% year-on-year to ¥251.4 billion, and core profit for the year decreased by 5.9% year-on-year to ¥209.9 billion. Impact of exchange rate on financial results The exchange rates for the yen in FY2020 are shown in the table below.
The resulting impacts were a ¥4.6 billion decrease in revenue and a ¥7.3 billion decrease in core operating profit compared with if the exchange rates of FY2019 were applied.
The full basis financial results include "Other income," "Other expenses," which are excluded from the core basis financial results. In FY2020, "Other income" was ¥7.6 billion (¥12.2 billion in the previous fiscal year) and "Other expenses" was ¥123.0 billion (¥45.9 billion in the previous fiscal year). As "Other expenses," the Company recorded impairment losses of ¥30.2 billion in relation to the termination of development for the anti-TIGIT antibody ASP8374/PTZ-201 in the second quarter of FY2020, and impairment losses of ¥58.8 billion in relation to a revision of the development plan for the gene therapy AT132 targeting patients with X-linked myotubular myopathy in the fourth quarter of FY2020, and as a result, in the financial results on a full basis, the decrease in profit was larger compared to the financial results on a core basis.
Prograf: Includes Advagraf, Graceptor, and ASTAGRAF XL.-Sales of XTANDI increased by 14.6% year-on-year to ¥458.4 billion. Sales increased in all regions of Japan, United States, Established Markets, Greater China, and International Markets.-Sales of XOSPATA increased by 67.2% year-on-year to ¥23.8 billion. In addition to an increase in sales in Japan, United States and Established Markets, sales commenced in International Markets in August 2020, and in Greater China in December 2020.-Co-promotion revenue of PADCEV grew significantly in United States, increasing by 607.3% year-on-year to ¥12.8 billion.-Evrenzo for the treatment of renal anemia, which has been sales commenced in Japan since November 2019, steadily increased.-Sales of Betanis / Myrbetriq / BETMIGA increased by 1.2% year-on-year to ¥163.6 billion.
While sales decreased in United States due to decreased demand, etc. associated with the reduction of patient visits to hospitals/clinics as a result of the impact of the spread of COVID-19, sales grew in Japan, Established Markets, Greater China and International Markets.-Sales of Prograf decreased by 5.3% year-on-year to ¥182.7 billion. Sales in Greater China increased, and sales in International Markets achieved similar levels year on year.
On the other hand, sales decreased in other regions.-In Japan, new product group sales continued to increase, including those of EVENITY, Suglat and SUJANU Combination Tablets. On the other hand, the main factor for the decrease in sales was the termination of sales agreements for Symbicort, human vaccines of KM Biologics Co., Ltd., Micardis family and Celecox.-In United States, sales of pharmacologic stress agent Lexiscan decreased due to decreased demand associated with the reduction of patient visits to hospitals/clinics as a result of the impact of the spread of COVID-19, mainly in the first quarter of FY 2020.2) Progress of initiatives for sustainable growth
The Company has been pursuing initiatives for sustainable growth over the mid to long term, based on its Strategic Plan 2018, the final year of which was FY2020, which set forth three main strategic goals toward: "Maximizing Product VALUE and Operational Excellence," "Evolving How We Create VALUE-With Focus Area Approach" and "Developing Rx+ programs."
The following are the main initiatives during the FY2020:
・ With regard to XTANDI, the Company worked to further strengthen market access and further increase penetration of XTANDI amongst urologists, and has been making efforts to increase the market penetration of XTANDI to the patients with prostate cancer in earlier stages by utilizing robust data based on clinical trials accumulated after launch.
・ With regard to Betanis / Myrbetriq / BETMIGA, the Company aimed to expand the market through continuous disease education activities, and worked to establish it as the first choice of therapy through the penetration of a balance of efficacy and safety.
・ With regard to XOSPATA, the Company steadily expanded the number of countries/areas where it launched by launching it in Japan and the United States in December 2018, and Europe in November 2019. Furthermore, the Company worked to increase penetration of XOSPATA amongst hematologists/oncologists as a new option for acute myeloid leukemia, and established its position as market leader by increasing product awareness and the rate that testing for FMS-like tyrosine kinase 3 (FLT3) mutations is carried out.
・ With regard to PADCEV, the Company worked to penetrate it into the market rapidly as a new treatment option for urothelial cancer by launching it in the United States in December 2019, and established its position as a preferred treatment option for patients with approved indications.
・ With regard to Evrenzo, the Company launched it in Japan in November 2019, worked to penetrate it into the market by differentiating it through the spread of a new mechanism of action, and worked to expand its market share as a first-in-class HIF-PH inhibitorIncluding these products, the Company is steadily advancing product development by preferentially allocating management resources to key post-POC pipeline projects that will support sustainable growth over the mid-to long-term.
Much progress was made in each project, including an application for approval with the aim of expanding indications of PADCEV in the United States, the obtaining of approval for XOSPATA in China, and the obtaining of approval for supplemental applications for Evrenzo in Japan.
The following are the main progress of each key post-POC pipeline project.
◇ XTANDI (enzalutamide) for the treatment of prostate cancer May 2020 In Japan, the Company obtained approval for supplemental applications for distant metastatic prostate cancer. June 2020 In Europe, the Company submitted an application for approval of its appended documentation giving data on overall survival found in the Phase 3 PROSPER trial on patients with non-metastatic castration-resistant prostate cancer.
October 2020 In the United States, the Company obtained approval of its appended documentation giving data on overall survival found in the Phase 3 PROSPER trial on patients with non-metastatic castration-resistant prostate cancer. November 2020 In China, the Company obtained approval for supplemental applications for non-metastatic castration-resistant prostate cancer. March 2021 In Europe, a positive CHMP (Committee for Medicinal Products for Human Use) opinion for supplemental applications for metastatic hormone-sensitive prostate cancer was adopted.
◇ XOSPATA (gilteritinib) for the treatment of acute myeloid leukemia December 2020 The Company discontinued patient registration for the Phase 3 LACEWING trial for patients with untreated acute myeloid leukemia with FLT3 mutation as it was unable to achieve longer overall survival, which is the primary endpoint. January 2021 In China, the Company obtained conditional approval as a treatment for adult patients with relapsed/refractory acute myeloid leukemia with FLT3 mutation.
March 2021 The Company announced that in the interim analysis of the Phase 3 COMMODORE trial, XOSPATA achieved a primary endpoint (overall survival) among patients with relapsed/refractory acute myeloid leukemia with FLT3 mutation.PADCEV (enfortumab vedotin) for the treatment of urothelial cancer September 2020 The Company announced that in the Phase 3 EV-301 trial, PADCEV statistically demonstrated significantly longer overall survival, which is a primary endpoint, than chemotherapy among patients with locally advanced or metastatic urothelial cancer, which had previously been treated with chemotherapy, including platinum-containing chemotherapy, and PD-1 or PD-L1 inhibitors.
October 2020 The Company announced satisfactory results for cohort 2 in the Phase 2 EV-201 trial among patients with locally advanced or metastatic urothelial cancer who have been treated with PD-1 or PD-L1 inhibitors, and have not been treated with platinumcontaining chemotherapy and are ineligible for cisplatin. February 2021 In the United States, the Company submitted a supplemental Biologics License Application with the aim of converting from accelerated approval to regular approval based on the results of the Phase 3 EV-301 trial among patients with locally advanced or metastatic urothelial cancer, which had previously been treated with chemotherapy, including platinum-containing chemotherapy, and PD-1 or PD-L1 inhibitors.
February 2021 In the United States, the Company submitted a supplemental Biologics License Application with the aim of expanding indications based on the results of cohort 2 in the Phase 2 EV-201 trial among patients with locally advanced or metastatic urothelial cancer who have been treated with PD-1 or PD-L1 inhibitors, and are ineligible for cisplatin. March 2021 In Japan, the Company submitted an application for approval of PADCEV as a treatment for patients with locally advanced or metastatic urothelial cancer who have been treated. March 2021 In Europe, the application for approval of PADCEV as a treatment for locally advanced or metastatic urothelial cancer, which had previously been treated with chemotherapy, including platinumcontaining chemotherapy, and PD-1 or PD-L1 inhibitors, was designated for accelerated assessment.
◇ Evrenzo (roxadustat) for the treatment of renal anemia April 2020 In Europe, the Company submitted an application for approval of Evrenzo as a treatment for renal anemia in adult patients. November 2020 In Japan, the Company obtained approval for a supplemental application for Evrenzo as a treatment for renal anemia in patients on non-dialysis.
◇ Fezolinetant, a selective neurokinin-3 receptor antagonist February 2021 In two Phase 3 trials in patients with moderate-to-severe vasomotor symptoms associated with menopause (SKYLIGHT 1 and SKYLIGHT 2), the Company announced that all primary endpoints were met with statistically significant improvements in the frequency and severity of vasomotor symptoms compared to placebo.
◇ Zolbetuximab, an anti-Claudin 18.2 monoclonal antibody Phase 3 trials for gastric and gastroesophageal junction adenocarcinoma, and a Phase 2 trial for pancreatic adenocarcinoma is underway. In addition to the above, the main developments, including approvals and applications for approvals, were as follows. May 2020 The Company received approval in the United States for an additional indication of neurogenic bladder in pediatric patients aged two years and older for the OAB treatment Vesicare. December 2020 The Company submitted an application in the United States for immunosuppressant agent Prograf for an additional indication of prevention of rejection in lung transplantation. March 2021 The Company obtained the approval of a new formulation, granules for suspension (oral extended-release formulation) and existing tablets (extended-release formulation) for the additional indication of neurogenic detrusor overactivity in children aged three years and older for the OAB treatment Myrbetriq in the United States.
In FY2020, the Company transferred marketing, etc. as follows. October 2020 The Company transferred the marketing authorizations and distribution of the psychotropic/medicine for the treatment of peptic ulcers Dogmatil to Nichi-Iko Pharmaceutical Co., Ltd. in Japan. December 2020 With regard to the non-steroidal Celecox for the treatment of inflammation and pain, the Company has terminated the joint sales promotion activities in Japan with Viatris Pharmaceuticals Japan Inc.
In addition, the Company plans to transfer the manufacturing and marketing authorization of Celecox from the Company to Viatris Pharmaceuticals Japan Inc. and transfer the distribution of the product to Viatris Pharmaceuticals Japan Inc. on July 31, 2021. 11 March 2021 In Japan, the Company has terminated the joint sales promotion activities of Acofide, a treatment for functional dyspepsia, with Zeria Pharmaceutical Co., Ltd. and transferred the distribution and marketing of the product to Zeria Pharmaceutical Co., Ltd. As our approach to pursuit even greater Operational Excellence, the Company has taken a multifaceted approach to reviewing activities and has been working to strengthen its business base. The following are the main initiatives during the FY2020: November 2020 The Company has decided to absorb and merge its wholly owned subsidiaries Astellas Pharma Tech Co., Ltd. and Astellas Green Supply, Inc. (effective date of absorption mergers: April 1, 2022 (planned)) November 2020
The Company has entered into an asset transfer agreement with Tillotts Pharma AG to transfer the manufacturing and marketing authorization of DIFICLIR tablets, a treatment of Clostridium difficile infection, to Tillotts Pharma AG in Europe, the Middle East, Africa, and some regions of the Commonwealth of Independent States, and is proceeding with the succession in the subject countries and regions. January 2021 The Kyushu Distribution Center, the Company’s fourth distribution base in Japan, began operations in Kitakyushu City, Fukuoka Prefecture. January 2021 The Company decided to newly construct a sterile drug production line in the Yaizu Technology Center of Astellas Pharma Tech Co., Ltd., a manufacturing subsidiary of the Company, and started construction.
January 2021 The Company returned to Tolmar International Limited the license for Eligard, a treatment for advanced prostate cancer, which had been marketed by Astellas Pharma Europe Ltd., a subsidiary of the Company, in Europe, the Middle East, the Commonwealth of Independent States, and Asia. In addition, the Company signed an agreement with Recordati Industria Chimica e Farmaceutica S.p.A., which sells Eligard under a new license from Tolmar International Limited, regarding the transfer of manufacturing and marketing authorization and the transfer of distribution, and is proceeding with the succession in the subject countries and regions.