On January 5, 2023 MorphoSys AG (FSE: MOR; NASDAQ: MOR) t reported preliminary Monjuvi U.S. net product sales for the full year of 2022 and reported its financial guidance for 2023 (Press release, MorphoSys, JAN 5, 2023, View Source [SID1234625905]). In this context, MorphoSys reduced its financial liability from the collaboration with Incyte and credited finance income accordingly.
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Preliminary Monjuvi (tafasitamab-cxix) U.S. net product sales are US$ 25.3 million (€ 24.0 million) for the fourth quarter and US$ 89.4 million (€ 84.9 million) for the full year of 2022. Fourth quarter and full year 2022 results will be published on March 15, 2023. For the full year of 2023, MorphoSys expects Monjuvi U.S. net product sales in the range of US$ 80 to 95 million.
As a result of changes in Monjuvi product sales expectations, the balance sheet item "Financial Liabilities from Collaborations" is reduced from € 580 million (balance as of September 30, 2022) to approximately € 220 million (balance as of December 31, 2022; unaudited). Finance income is credited with the difference between the two amounts. The balance in "Financial Liabilities from Collaborations" reflects an accounting view of expected future profits from the net product sales of Monjuvi in the U.S. in relapsed or refractory diffuse large B-cell lymphoma (r/r DLBCL) owed to our partner Incyte. The reduction in Financial Liabilities from Collaborations has no impact on cash.
"Patients living with relapsed or refractory diffuse large B-cell lymphoma continued to benefit from Monjuvi in 2022, as we saw an increase in sales of our medicine in the fourth quarter and a preliminary final sales total in line with our updated guidance," said Jean-Paul Kress, M.D., Chief Executive Officer of MorphoSys. "As we enter into the third year post-launch, we set our sales guidance for 2023 and longer-term projections for Monjuvi in its approved indication to reflect the ongoing and future impact of competitive activity. The team remains highly engaged to ensure continued awareness and use of Monjuvi as the only NCCN-preferred in-practice, out-patient immunotherapy for all appropriate patients, while preparing for our longer-term opportunities for pelabresib in first-line myelofibrosis and Monjuvi for first-line DLBCL."
Full Year 2023 Financial Guidance:
2023 Financial Guidance 2023 Guidance Insights
Monjuvi U.S. net product sales US$ 80m to 95m 100% of Monjuvi U.S. net product sales are recorded on MorphoSys’ income statement and related profit/loss is split 50/50 between MorphoSys and Incyte.
Gross margin for Monjuvi U.S. net product sales 75% to 80% 100% of Monjuvi U.S. product cost of sales are recorded on MorphoSys’ income statement and related profit/loss is split 50/50 between MorphoSys and Incyte.
R&D expenses € 290m to 315m 2023 anticipated to be incrementally higher than 2022 due to the expansion of the pelabresib development program.
SG&A expenses € 140m to 155m 45% to 50% of mid-point of SG&A expenses represent Monjuvi U.S. selling costs of which 100% are recorded in MorphoSys’ income statement. Incyte reimburses MorphoSys for half of these selling expenses.
Additional information related to 2023 Financial Guidance:
Tremfya royalties will continue to be recorded as revenue without any cost of sales in MorphoSys’ income statement. These royalties, however, will not contribute any cash to MorphoSys, as 100% of the royalties will be passed on to Royalty Pharma.
MorphoSys anticipates receiving royalties for Minjuvi sales outside of the U.S.
MorphoSys does not anticipate any significant cash-accretive revenues from the achievement of milestones in 2023.
MorphoSys anticipates sales of commercial and clinical supply of tafasitamab outside of the U.S. to its partner Incyte. Revenue from this supply is recorded in the "Licenses, milestones and other" category in MorphoSys’ income statement.
These sales result in a zero gross profit/margin. As such, MorphoSys does not provide guidance for these sales.