On January 26, 2023 Myovant Sciences (NYSE: MYOV), a biopharmaceutical company that aspires to redefine care for women and men through purpose-driven science, empowering medicines, and transformative advocacy, reported financial results for the third quarter of fiscal year 2022 and provided other corporate updates (Press release, Myovant Sciences, JAN 26, 2023, View Source [SID1234626585]).
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"During the third quarter fiscal year 2022, our brands had outstanding performance and double-digit growth over the prior quarter, with ORGOVYX expanding leadership in the GnRH antagonist class for advanced prostate cancer and MYFEMBREE reaching more patients with uterine fibroids and endometriosis while continuing to grow the GnRH antagonist class for these indications," said David Marek, Chief Executive Officer of Myovant Sciences, Inc. Mr. Marek added, "We are also excited that our special general meeting of shareholders to vote on the merger with Sumitovant Biopharma is scheduled for March 1, 2023. If approved, we anticipate the closing of the merger to occur shortly thereafter."
Third Fiscal Quarter 2022 and Recent Corporate Updates
Merger Update
•On October 23, 2022, Myovant announced that it had entered into a merger agreement with Sumitovant Biopharma Ltd. (Sumitovant) and Sumitomo Pharma Co., Ltd. (Sumitomo Pharma) under which Sumitovant has agreed to acquire the remaining shares of Myovant that Sumitovant does not currently hold. Subject to the terms and conditions set forth in the merger agreement, in the event the merger is consummated, holders of Myovant common shares will be entitled to receive $27.00 per share in cash.
•The applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), expired on January 2, 2023. The expiration of the waiting period under the HSR
Act satisfies one of the conditions to consummation of the merger. Consummation of the merger remains subject to the satisfaction of certain other conditions.
•The definitive proxy statement was filed with the U.S. Securities and Exchange Commission (SEC) on January 23, 2023 and Myovant’s special general meeting of shareholders to vote on the merger is set to take place on March 1, 2023.
ORGOVYX (relugolix 120 mg)
•Third fiscal quarter 2022 net product revenues for ORGOVYX in the U.S. were $48.7 million, reflecting 12% sequential growth compared to the second fiscal quarter 2022. ORGOVYX commercial demand volume grew 13% quarter-over-quarter driven by strong new patient starts and continued expansion across all treatment settings.
•Approximately 4,000 new patients started treatment with ORGOVYX in the third fiscal quarter of 2022, reaching approximately 26,000 cumulative patients since launch.
•ORGOVYX expanded its leadership in the gonadotropin-releasing hormone (GnRH) antagonist class for advanced prostate cancer with a 59% share based on months of therapy.
•Since launching in January 2021, ORGOVYX drove a 160% volume increase of the GnRH antagonist market for products approved by the U.S. Food and Drug Administration (FDA) for the treatment of advanced prostate cancer.
•In December 2022, Myovant completed a New Drug Submission to Health Canada seeking marketing approval for ORGOVYX for advanced prostate cancer.
•In October 2022, Myovant’s commercialization partner, Accord Healthcare, Ltd. (Accord), launched ORGOVYX for the treatment of advanced hormone-sensitive prostate cancer in Europe. To date, Accord has launched ORGOVYX in Germany, Austria, Czech Republic, and the United Kingdom.
•On January 25, 2023, the first participant was enrolled in the Phase 3 REPLACE-CV study evaluating the risk of major cardiovascular events with ORGOVYX compared with leuprolide in patients with prostate cancer who require treatment with androgen deprivation therapy for at least one year.
MYFEMBREE (relugolix 40 mg, estradiol 1.0 mg, and norethindrone acetate 0.5 mg)
•Third fiscal quarter 2022 net product revenues for MYFEMBREE in the U.S. were $10.5 million, reflecting 64% sequential growth compared to second fiscal quarter 2022. MYFEMBREE commercial demand volume grew 49% quarter-over-quarter driven by accelerating growth in new patient starts and prescribers.
•Approximately 4,500 new patients started treatment with MYFEMBREE in the third fiscal quarter 2022, resulting in approximately 13,500 cumulative patients and 50% sequential quarterly growth in the number of patients treated, since launch. MYFEMBREE reached 38% NBRx share (uterine fibroids and endometriosis) in December 2022 contributing to 29% TRx growth in the overall GnRH antagonist class since MYFEMBREE’s launch.
•As of December 31, 2022, 75% commercial coverage has been obtained for MYFEMBREE’s endometriosis indication, covering approximately 124 million lives in the U.S.
RYEQO (relugolix 40 mg, estradiol 1.0 mg, and norethindrone acetate 0.5 mg)
•In October 2022, the Type II variation application to the European Medicines Agency (EMA) filed by Myovant’s commercialization partner, Gedeon Richter Plc. (Richter), seeking approval for RYEQO for the treatment of moderate to severe pain associated with endometriosis in adult women of reproductive age with a history of previous medical or surgical treatment for their endometriosis, was validated and accepted by the EMA. Pursuant to the Richter Development and Commercialization Agreement, the acceptance of the Type II variation application by the EMA triggered a $4.0 million milestone payment due from Richter, which Myovant received and recorded as Richter license and milestone revenue in the three months ended December 31, 2022.
Expected Upcoming Milestones
•Special general meeting of shareholders to vote on the merger with Sumitovant Biopharma is set to take place on March 1, 2023 and, if approved, the closing of the merger is expected to occur shortly thereafter.
•Myovant expects the FDA decision for the MYFEMBREE supplemental New Drug Application (sNDA) proposing updates to MYFEMBREE’s U.S. Prescribing Information (USPI) based on the safety and efficacy data from the Phase 3 LIBERTY randomized withdrawal study (RWS) of MYFEMBREE in premenopausal women with heavy menstrual bleeding associated with uterine fibroids for up to two years by the January 29, 2023 Prescription Drug User Fee Act (PDUFA) goal date.
•Myovant expects to submit an sNDA to the FDA for the SPIRIT 2-year long-term extension study for MYFEMBREE in women for the management of pain associated with endometriosis in the first half of calendar year 2023.
Third Fiscal Quarter 2022 Financial Summary
Total revenues for the three months ended December 31, 2022, and 2021 were $100.2 million and $54.4 million, respectively.
•Product revenue, net for the three months ended December 31, 2022, and 2021 was $61.4 million and $29.3 million, respectively. Product revenue, net consisted primarily of the following:
•Product revenue, net from sales of ORGOVYX in the U.S. for the three months ended December 31, 2022 was $48.7 million compared to $24.4 million for the three months ended December 31, 2021.
•Product revenue, net from sales of MYFEMBREE in the U.S. for the three months ended December 31, 2022 was $10.5 million compared to $2.4 million for the three months ended December 31, 2021.
•Pfizer collaboration revenue for the three months ended December 31, 2022, and 2021 was $29.3 million and $25.2 million, respectively. Pfizer collaboration revenue for both the three months ended December 31, 2022 and 2021 consists of the partial recognition of the upfront payment Myovant received from Pfizer in December 2020 and of the $100.0 million regulatory milestone payment Myovant received from Pfizer that was triggered upon the FDA approval of MYFEMBREE for the management of heavy menstrual bleeding associated with uterine fibroids on May 26, 2021. Pfizer collaboration revenue for the three months ended December 31, 2022 also includes the partial recognition of the $100.0 million regulatory milestone payment Myovant received from Pfizer that was triggered upon the FDA approval of MYFEMBREE for the management of moderate to severe pain associated with endometriosis on August 5, 2022
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•Accord license and milestone revenue for the three months ended December 31, 2022 consists of the recognition of a $5.0 million milestone payment from Accord that was triggered upon Accord’s first commercial sale of ORGOVYX in Europe in October 2022. There was no Accord license and milestone revenue for the three months ended December 31, 2021.
•Richter license and milestone revenue for the three months ended December 31, 2022 consists of the recognition of a $4.0 million regulatory milestone payment from Richter that was triggered upon the EMA acceptance of Richter’s Type II variation submission for RYEQO for the treatment of moderate to severe pain associated with endometriosis in adult women of reproductive age with a history of previous medical or surgical treatment for their endometriosis. There was no Richter license and milestone revenue for the three months ended December 31, 2021.
Cost of product revenue for the three months ended December 31, 2022 was $7.4 million compared to $4.2 million for the three months ended December 31, 2021 related to the cost of goods sold and royalty expense payable to Takeda pursuant to the Takeda License Agreement. The increase in cost of product revenue in the three months ended December 31, 2022 was due to an increase in cost of goods sold and royalty expense payable to Takeda primarily as a result of higher sales of ORGOVYX and MYFEMBREE in the U.S., as compared to the year ago period.
Collaboration expense to Pfizer for the three months ended December 31, 2022, was $26.8 million, compared to $12.1 million for the three months ended December 31, 2021, reflecting Pfizer’s 50% share of net profits from sales of ORGOVYX and MYFEMBREE in the U.S. The increase in collaboration expense to Pfizer in the three months ended December 31, 2022 was primarily due to an increase in net profits generated from sales of ORGOVYX and MYFEMBREE in the U.S., as compared to the year ago period.
Selling, general and administrative (SG&A) expenses for the three months ended December 31, 2022, and 2021 were $86.4 million and $72.1 million, respectively. The increase in SG&A expenses primarily reflects higher expenses to support the ORGOVYX and MYFEMBREE commercialization activities in the U.S, including higher personnel-related costs due to higher headcount, and an increase in legal and professional fees related to activities associated with the merger agreement.
Research and development (R&D) expenses for the three months ended December 31, 2022, and 2021 were $31.5 million and $25.7 million, respectively. The increase in R&D expenses was primarily driven by higher personnel-related expenses, primarily due to higher headcount.
Interest expense for the three months ended December 31, 2022, and 2021 was $6.1 million and $3.5 million, respectively, and was primarily related to the Sumitomo Pharma Loan Agreement. Interest expense related to the Sumitomo Pharma Loan Agreement increased $3.2 million, as a result of an increase in interest rates as compared to the year ago period.
Income tax expense for the three months ended December 31, 2022, and 2021 was $1.2 million and $0.3 million, respectively. Myovant’s tax expense currently relates principally to profits earned in the U.S.
Net loss for the three months ended December 31, 2022 was $57.6 million compared to $63.4 million for the year ago period. On a per common share basis, net loss was $0.59 and $0.68 for the three months ended December 31, 2022 and 2021, respectively.
Capital resources: Cash, cash equivalents, marketable securities, and amounts available under the Sumitomo Pharma Loan Agreement totaled $315.7 million in the aggregate as of December 31, 2022, and consisted of $274.4 million of cash, cash equivalents, and marketable securities and $41.3 million of available borrowing capacity under the Sumitomo Pharma Loan Agreement.