On February 28, 2023 HUTCHMED (China) Limited ("HUTCHMED", the "Company" or "we") (Nasdaq/AIM:HCM; HKEX:13), the innovative, commercial-stage biopharmaceutical company, reported its financial results for the year ended December 31, 2022 and provides updates on key clinical and commercial developments (Press release, Hutchison China MediTech, FEB 28, 2023, View Source [SID1234627893]).
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All amounts are expressed in U.S. dollars unless otherwise stated.
Key Highlights
Strategic
Announced a strategy update, including a prioritization of late-stage assets and a new global partnership approach to bring innovative medicines to patients outside of China
Signed a landmark licensing agreement with Takeda[1] to license fruquintinib outside of China for a potential total of up to $1.13 billion, plus royalties on net sales, demonstrating this strategy in action
Focus on driving near-term value creation and establishing a profitable, sustainable business over the long term
Product and pipeline
FRESCO-2 Phase III data for fruquintinib in refractory metastatic CRC[2], our first global multi-regional clinical trial and presented at ESMO (Free ESMO Whitepaper)[3], met the primary end point of overall survival with a 34% reduction in risk of death
Started rolling submission of NDA[4] to U.S. FDA[5] for fruquintinib for the treatment of refractory CRC
Statistically significant PFS[6] benefit in fruquintinib FRUTIGA Phase III in China with supplemental NDA in preparation
Global SAVANNAH Phase II data for savolitinib showed 52% response rate and 9.6 months duration of response in high MET[7] 2L+ NSCLC[8] patients with no prior chemotherapy
ORPATHYS (savolitinib) to be included in NRDL[9] effective March 1, 2023
Over 15 registration/registration-intent studies ongoing with six products
Financial
Oncology/Immunology revenues up 37% (41% CER[10]) to $163.8 million and in line with guidance
ELUNATE, SULANDA and ORPATHYS combined in-market sales[11] up 70%
Substantial cash balance, plus $400 million upfront payment from Takeda at closing, will position HUTCHMED well on the path to a sustainable business
2022 FULL YEAR RESULTS & BUSINESS UPDATES
"I am proud of the progress that we at HUTCHMED have made during 2022," said Mr Simon To, Chairman of HUTCHMED. "This work is already bearing fruit, as indicated not only by the increase in revenues, but also the positive clinical and regulatory progress we have made with fruquintinib – culminating in the successful, post-period licensing agreement with Takeda, marking a significant delivery against the Company’s strategy. This out-licensing ensures we remain true to the overall goal of our business of safeguarding access to our innovative medicines to patients globally. Further, our partnerships provide significant financial momentum while we focus on revenue growth from increased product sales in China."
"This strategy of revenue growth and strategic partnerships places us well on the path to a sustainable business. It is this path which will allow us to continue our expansion, as demonstrated by HUTCHMED’s continued delivery in China where our oncology commercial team has reached about 900 people to support greater access to our medicines; our ongoing development of savolitinib, which became our third product on the NRDL; and the continued ability of our business to develop medicines towards global markets. It is through this ability that we expect to see multiple New Drug Applications being made not only in China but with key regulators around the world as we look to extend our ability to bring potentially life changing medicines to patients around the world."
"2022 has been a key turning point for HUTCHMED, but I believe it will enable us to truly reach our goal of becoming a global biopharmaceutical company."
Dr Weiguo Su, Chief Executive Officer and Chief Scientific Officer of HUTCHMED, said, "2022 was a pivotal year for HUTCHMED. Challenged by difficult market conditions, the team worked incredibly hard to position HUTCHMED for success today as well as for a promising future. In November, we announced a new strategy that focuses on accelerating our path to a sustainable and profitable business, which involves a reprioritization of pipeline assets and a partnership approach for bringing our innovative medicines more efficiently to patients outside of China. We believe that this new strategy has unlocked greater value in the Company and we are already seeing a positive impact from this approach."
"In early 2023 we announced a significant licensing deal with Takeda for the global development, commercialization and manufacturing of fruquintinib, outside of China. We are pleased to have attracted such a strong partner and to place fruquintinib in the hands of a company with the scale, expertise, resources and commitment to maximize its success globally, as we believe we are already doing in China. The expected proceeds from the deal notably extends our cash runway, and the additional bandwidth allows us to continue to pursue value-driving opportunities from our internal pipeline while supporting our commercial growth in China. The Takeda deal perfectly exemplifies our global partnership approach and showcases our commitment to fulfilling our promises, swiftly and effectively."
"This approach goes hand in hand with the strategic prioritization of our pipeline. This includes focusing our development efforts on late-stage assets through clinical development and towards patients. Ultimately, this is how we will accelerate our path to a sustainable business over the long term. As part of our pipeline prioritization, we have reduced some funding to select international clinical programs and we look to further develop of some of these programs through partnerships. Specifically, these changes affect amdizalisib, HMPL-306 and HMPL-760 international clinical programs. We will continue the surufatinib clinical program in Japan where a bridging study is fully recruited. Going forward, HUTCHMED still intends to continue to run early phase development programs for select drug candidates in the U.S., EU and Japan including sovleplenib where we believe our compounds are differentiated from a global perspective. This does not impact our commitment to patients, which, if anything, has intensified as we sharpen our focus on a smaller set of programs that we believe have the most immediate patient impact.
I am proud of what the team has achieved this year amidst very difficult times for the sector, and feel very positive about our outlook."
I. COMMERCIAL OPERATIONS
Total revenues increased 20% (24% CER) to $426.4 million in 2022 (2021: $356.1m), driven by commercial progress on our three in-house developed oncology drugs in China;
Oncology/Immunology consolidated revenues up 37% (41% CER) to $163.8 million (2021: $119.6m);
ELUNATE (fruquintinib) in-market sales in 2022 increased 32% to $93.5 million (2021: $71.0m), reflecting its expanding lead in market share, particularly in tier 2 and 3 cities;
SULANDA (surufatinib) in-market sales in 2022 increased 178% to $32.3 million (2021: $11.6m), reflecting its first time NRDL inclusion which started in January 2022;
ORPATHYS (savolitinib) in-market sales in 2022 increased 159% to $41.2 million (2021: $15.9m) following its launch in the second half of 2021 through AstraZeneca’s[12] extensive oncology commercial organization. Rapid initial self-pay uptake due to being the first-in-class selective MET inhibitor in China, expect continued uptake to be supported by NRDL inclusion starting March 1, 2023;
TAZVERIK (tazemetostat) successfully launched in Hainan province in China in June 2022; and
Successful management of commercial operations to expand coverage of oncology hospitals and physicians despite challenges of pandemic-related lockdowns in the first half of 2022.
$’millions In-market Sales* Consolidated Revenues**
2022 2021 % Change 2022 2021 % Change
ELUNATE $93.5 $71.0 +32% $69.9 $53.5 +31%
SULANDA $32.3 $11.6 +178% $32.3 $11.6 +178%
ORPATHYS $41.2 $15.9 +159% $22.3 $11.3 +97%
TAZVERIK $0.1 – – $0.1 – –
Product Sales $167.1 $98.5 +70% $124.6 $76.4 +63%
Other R&D[13] services income $24.2 $18.2 +33%
Milestone payment $15.0 $25.0 -40%
Total Oncology/Immunology $163.8 $119.6 +37%
* = For ELUNATE and ORPATHYS, represents total sales to third parties as provided by Lilly[14] and AstraZeneca, respectively; and ELUNATE sales to other third parties as invoiced by HUTCHMED.
** = For ELUNATE, represents manufacturing fees, commercial service fees and royalties paid by Lilly, to HUTCHMED, and sales to other third parties invoiced by HUTCHMED; for ORPATHYS represents manufacturing fees and royalties paid by AstraZeneca; for SULANDA and TAZVERIK, represents the Company’s sales of the products to third parties.
II. REGULATORY UPDATES
China
Received Breakthrough Therapy Designation in China for sovleplenib (HMPL-523) in January 2022 for the treatment of ITP[15];
Received approval for TAZVERIK in the Hainan Boao Lecheng International Medical Tourism Pilot Zone in May 2022 for the treatment of certain patients with epithelioid sarcoma or follicular lymphoma; and
Received Macau approvals for ELUNATE and SULANDA, the first drugs approved in the territory based on China NMPA[16] approval, following regulatory updates in Macau.
Ex-China
Fruquintinib rolling NDA submission to U.S. FDA initiated in December 2022 for the treatment of refractory CRC. The U.S. FDA granted Fast Track Designation for the development of fruquintinib for the treatment of patients with metastatic CRC in June 2020, enabling the company to submit sections of the NDA on a rolling basis;
Fruquintinib submissions to the EMA[17] and the Japanese PMDA[18] to follow the completion of the US NDA submission; all expected to be completed in 2023;
Savolitinib granted Fast Track Designation by the FDA for the combination treatment with TAGRISSO of NSCLC patients harboring MET overexpression and/or amplification following progression on TAGRISSO; and
Surufatinib U.S. NDA and EMA MAA[19] withdrawn:
A Complete Response Letter regarding the US NDA (CRL) was issued in April 2022 by the U.S. FDA, citing the requirement of a multi-regional clinical trial in a more representative patient population. Following the Letter, the U.S. NDA was withdrawn in January 2023; the MAA was withdrawn in August 2022, following interactions with EMA reviewers which suggested that there is a low probability of a positive opinion;
In Japan, the bridging study is continuing and a pre-NDA PMDA consultation is targeted for the first half of 2023; and
Pandemic-related issues concerning inspection access contributed to FDA and EMA actions.
III. CLINICAL DEVELOPMENT ACTIVITIES in 2022
Savolitinib (ORPATHYS in China), a highly selective oral inhibitor of MET being developed broadly across MET-driven patient populations in lung, gastric and papillary renal cell carcinomas
Presentation of SAVANNAH global Phase II study data showing improved response rates with increasing levels of MET aberration for the TAGRISSO combination (NCT03778229) in NSCLC patients harboring EGFR[20] mutation and MET amplification or overexpression at WCLC[21] 2022. Overall results demonstrated strong ORR[22], DoR[23] and PFS among patients with higher MET levels, particularly among those with no prior chemotherapy;
Aligned with FDA for the pivotal Phase II study for accelerated approval of the TAGRISSO combination for NSCLC MET patients following progression on TAGRISSO, and began enrolling;
Initiated SAFFRON, a global, pivotal Phase III study of the TAGRISSO combination (NCT05261399), which triggered a $15 million milestone payment. Enrolled patients will have MET levels consistent with the higher MET level patient groups in SAVANNAH and have had no prior chemotherapy;
Enrolling SACHI, a pivotal Phase III study of the TAGRISSO combination in China for NSCLC patients with MET amplification following progression on EGFR inhibitor treatment (NCT05015608);
Enrolling SANOVO, a pivotal Phase III study of the TAGRISSO combination in China in NSCLC patients harboring EGFR mutation and MET overexpression, comparing the combination with TAGRISSO monotherapy (NCT05009836);
Presented final Phase II OS[24] in patients with MET exon 14 skipping alteration NSCLC at ELCC[25] 2022 (NCT02897479);
Enrolling the confirmatory China Phase IIIb study in MET exon 14 skipping altered NSCLC in both first-line and second-line and above patients (NCT04923945);
Enrolling SAMETA, a global Phase III study in MET-driven PRCC[26] of the IMFINZI combination comparing to sunitinib (NCT05043090);
Enrolled a China Phase II study in gastric cancer patients who have failed at least one line of systemic treatment (NCT04923932); and
Initiated SOUND, a China Phase II study of the IMFINZI combination in EGFR wild-type NSCLC patients with MET alterations (NCT05374603).
Potential upcoming clinical and regulatory milestones for savolitinib:
Convert the gastric cancer Phase II study to a registration trial, following discussion with NMPA in the first half of 2023; and
Complete enrollment of SAVANNAH pivotal Phase II study.
Fruquintinib (ELUNATE in China), a highly selective oral inhibitor of VEGFR[27] 1/2/3 designed to improve kinase selectivity to minimize off-target toxicity and thereby improve tolerability; approved and launched in China
Presented positive results of the global Phase III FRESCO-2 registration trial (NCT04322539) in 691 refractory metastatic CRC patients, recruited from 14 countries including U.S., EU, Japan and Australia at ESMO (Free ESMO Whitepaper) in September 2022. Treatment with fruquintinib resulted in a statistically significant and clinically meaningful increase in the primary endpoint of OS and the key secondary endpoint of PFS compared to placebo;
Presented preliminary data from the U.S. Phase Ib monotherapy study of fruquintinib in patients with refractory metastatic CRC (NCT03251378) at 2022 ASCO (Free ASCO Whitepaper) GI[28]; and
Reported top-line results of the FRUTIGA China Phase III registration study (NCT03223376) in 703 advanced gastric cancer patients. The study met one of the primary endpoints of statistically significant improvement in PFS, which is clinically meaningful. The other primary endpoint of OS was not statistically significant. There were statistically significant improvements in secondary endpoints including ORR and DCR[29], and improved DoR; and
Initiated China Phase III study of combination with PD-1[30] inhibitor sintilimab in RCC[31] (NCT05522231).
Potential upcoming clinical and regulatory milestones for fruquintinib:
Submit a supplementary NDA to the NMPA for fruquintinib in combination with paclitaxel in the treatment of advanced gastric cancer in H1 2023, supported by results of the FRUTIGA study;
Complete recruitment of a Phase II registration enabling study for endometrial cancer of fruquintinib in combination with PD-1 inhibitor sintilimab around mid-2023 (NCT03903705);
Submit FRUTIGA results for presentation at a scientific conference;
Submit for presentation further Phase II data of fruquintinib with PD-1 inhibitors; and
Publication of FRESCO-2 results in a peer-reviewed scientific journal.
Surufatinib (SULANDA in China), an oral inhibitor of VEGFR, FGFR[32] and CSF-1R[33] designed to inhibit tumor angiogenesis and promote the body’s immune response against tumor cells via tumor associated macrophage regulation; approved and launched in China
Presented a pooled analysis of safety data from the SANET-p and SANET-ep studies at the 2022 ASCO (Free ASCO Whitepaper)[34] annual meetings; and
Presented data from the Phase Ib/II global tislelizumab combination study at NANETS[35] 2022.
Potential upcoming clinical and regulatory milestones for surufatinib:
Complete bridging study in NET patients in Japan (NCT05077384) in the first half of 2023 and discuss results with the Japanese PMDA.
Sovleplenib (HMPL-523), an investigative and highly selective oral inhibitor of Syk[36], an important component of the Fc receptor and B-cell receptor signaling pathway
Fully enrolled ESLIM-01 China Phase III study in primary ITP (NCT03951623) in December 2022.
Potential upcoming clinical milestones for sovleplenib:
Report top-line results from ESLIM-01 China Phase III in the second half of 2023; and
Complete Phase II Proof-of-Concept study in warm AIHA[37] in China and decide on whether to proceed into Phase III.
Amdizalisib (HMPL-689), an investigative and highly selective oral inhibitor of PI3Kδ[38] designed to address the gastrointestinal and hepatotoxicity associated with currently approved and clinical-stage PI3Kδ inhibitors
Completed recruitment of patients for China registration Phase II study for the treatment of follicular lymphoma (with Breakthrough Therapy Designation) in February 2023 (NCT04849351); and
Initiated China combination trial with tazemetostat in February 2023 (NCT05713110).
Potential upcoming clinical and regulatory milestones for amdizalisib:
Report top-line results from the China registration Phase II study for the treatment of follicular lymphoma in H2 2023.
Tazemetostat (TAZVERIK in the U.S., Japan and the Hainan Pilot Zone), a first-in-class, oral inhibitor of EZH2 licensed from Ipsen[39] subsidiary Epizyme[40] in China
Initiated a China bridging study in follicular lymphoma in July 2022 for conditional registration based on U.S. approvals (NCT05467943);
Ipsen presented updated data from the Phase Ib portion of the global SYMPHONY-1 Phase III trial at ASH (Free ASH Whitepaper) (NCT04224493) of tazemetostat combined with lenalidomide and rituximab (R²) in patients with relapsed or refractory follicular lymphoma after at least one prior line of therapy; and
Initiated the China portion of the global SYMPHONY-1 Phase III trial in September 2022.
Earlier stage investigational drug candidates
In addition to the six drug candidates being developed in over 15 registration studies above, HUTCHMED is developing six further oncology candidates in early stage clinical trials. These are HMPL-306, a highly selective oral inhibitor of IDH1/2[41] designed to address resistance to currently marketed IDH inhibitors; HMPL-760, a highly selective, third-generation oral inhibitor of BTK[42] with improved potency versus first generation BTK inhibitors against both wild type & C481S mutant enzymes; HMPL-453, a highly selective oral inhibitor of FGFR 1/2/3; HMPL-295, a highly selective oral inhibitor of ERK[43] in the MAPK pathway [44] with the potential to address intrinsic or acquired resistance from upstream mechanisms such as RAS-RAF-MEK; HMPL-653, an oral, highly selective, and potent CSF-1R inhibitor designed to target CSF-1R driven tumors as a monotherapy or in combinations; and HMPL-A83, a differentiated, red blood cell sparing CD47 monoclonal antibody.
Subject to data and consultation with the CDE[45], several of these earlier stage drug candidates have potential to move into registration trials in 2023 and early 2024. We have recently agreed a registration enabling trial design for HMPL-453 for the treatment of IHCC[46] with the CDE and preparations are underway to start the study. Results supporting this decision will be submitted for scientific presentation in 2023.
IV. COLLABORATION UPDATES
Takeda Exclusive Worldwide License for Fruquintinib Outside China
Subject to customary closing conditions, including completion of antitrust regulatory reviews:
Takeda will become responsible for development, manufacturing and commercialization in all indications and territories outside of mainland China, Hong Kong and Macau; and
HUTCHMED will be eligible to receive up to $1.13 billion, including $400 million upfront on closing of the agreement and up to $730 million in additional potential payments relating to regulatory, development and commercial sales milestones, as well as royalties on net sales.
Inmagene candidates discovered by HUTCHMED
Two Phase I trials initiated in Australia and the U.S. on two HUTCHMED drug candidates being developed by Inmagene: IMG-007, an investigative OX40 antagonistic monoclonal antibody designed to selectively shut down OX40+ T cell function; and IMG-004, a reversible, non-covalent, highly selective oral BTK inhibitor designed to target immunological diseases.
V. OTHER VENTURES
Other Ventures include our profitable prescription drug marketing and distribution platforms
Other Ventures consolidated revenues increased by 11% (15% at CER) to $262.6 million (2021: $236.5m);
SHPL[47] non-consolidated joint venture revenues increased by 11% (14% at CER) to $370.6 million (2021: $332.6m);
Consolidated net income attributable to HUTCHMED from our Other Ventures increased by 16% (17% at CER) to $54.6 million (2021: $47.3m which excluded $95.6m related to HBYS[48]), which was primarily due to the net income contributed from SHPL of $49.9 million (2021: $44.7m); and
We continue to review divestment and equity capital market options and we have started the process for a share reform of the SHPL joint venture.
VI. IMPACT OF COVID-19
COVID-19 had some impact on our research, clinical studies and our commercial activities in 2022, particularly with respect to hospital lockdowns, travel restrictions, and shipping difficulties. Clinical sites in Shanghai were particularly impacted during April and May 2022. Measures were put in place to reduce the impact of such restrictions to the extent possible, including online patient follow-up and the retention of core research teams on-site to maintain critical activities, with business returning to normal in June. Restrictive measures related to the COVID-19 pandemic have gradually been lifted in China starting from December 2022, and we expect the travel, social and economic activities to normalize.
VII. SUSTAINABILITY
HUTCHMED has made continued progress in its commitment to the long-term sustainability of its businesses and communities in which it conducts business, including:
Enhanced disclosures, including publishing our second Sustainability Report, and publishing eight new governance and sustainability-related policies and statements;
Strengthened governance, including establishing a four-tier governance framework to facilitate oversight and implementation of sustainability issues;
Committed to 11 short- to long-term sustainability goals and targets, incorporated sustainability KPIs on goals and targets into management’s performance-based remuneration;
Comprehensive stakeholder engagement conducted with over 2,400 key internal and external stakeholders involving quantitative and qualitative assessments, and a materiality analysis to help identify the most material sustainability issues to the Company;
Enhanced sustainability awareness building in over 20 meetings/sessions during the year amongst the general staff, the Sustainability Working Group, senior management, the Sustainability Committee and the Board; and
Climate risks action, including an assessment to identify climate-related risks and opportunities for the Company, and following the recommended disclosure framework of the Task Force on Climate-related Financial Disclosures (TCFD).
We believe all these efforts will guide us towards a more sustainable future. The 2022 Sustainability Report will be published alongside our 2022 Annual Report in due course and will include further information on HUTCHMED sustainability initiatives and their performance.
VIII. U.S. ACCOUNTING OVERSIGHT
As had been expected, in 2022 the U.S. Securities and Exchange Commission (SEC) named over 170 China-based companies, including HUTCHMED, to its conclusive list of public companies identified as having retained a registered public accounting firm that the Public Company Accounting Oversight Board ("PCAOB") is unable to inspect to investigate completely. However, on December 15, 2022, the PCAOB announced that it was able to inspect and investigate completely registered public accounting firms headquartered in mainland China and Hong Kong and vacated its prior determination that it was unable to inspect or investigate them completely. As a result, we do not expect to be identified as a Commission-Identified Issuer for the fiscal year ended December 31, 2022 after we file our annual report on Form 20-F for such fiscal year.
This has had no impact on the business operations of the Company.
FULL YEAR 2022 FINANCIAL RESULTS
Cash, Cash Equivalents and Short-Term Investments were $631.0 million as of December 31, 2022 compared to $1,011.7 million as of December 31, 2021.
Adjusted Group (non-GAAP[49]) net cash flows excluding financing activities in 2022 were -$297.9 million (2021: -$73.5m) mainly due to increased spending on Oncology/Immunology R&D; and
Net cash used in financing activities in 2022 totaled $82.8 million (2021: net cash generated from financing activities of $650.0m primarily from the offering of shares on HKEX[50]) mainly due to the repayments of bank borrowings, dividends paid to non-controlling shareholders of subsidiaries and purchases of ADSs[51] by a trustee for the settlement of equity awards.
Revenues for the year ended December 31, 2022 were $426.4 million compared to $356.1 million in 2021.
Oncology/Immunology consolidated revenues increased 37% (41% at CER) to $163.8 million (2021: $119.6m) resulting from:
ELUNATE revenues increased 31% to $69.9 million (2021: $53.5m) in manufacturing revenues, promotion and marketing service revenues and royalties, as our in-house sales team increased in-market sales 32% to $93.5 million (2021: $71.0m), as provided by Lilly;
SULANDA revenues increased 178% to $32.3 million (2021: $11.6m), after inclusion on the NRDL starting in January 2022;
ORPATHYS revenues increased 97% to $22.3 million (2021: $11.3m), in manufacturing revenues and royalties following its launch in the second half of 2021. AstraZeneca reported $41.2 million in-market sales (2021: $15.9m) of ORPATHYS in 2022;
TAZVERIK revenues of $0.1 million following its successful launch in Hainan province in June 2022;
Milestone payment of $15.0 million (2021: $25.0m milestone payment upon first sale of ORPATHYS in China), to us by AstraZeneca, related to the initiation of SAFFRON; and
Other R&D services income of $24.2 million (2021: $18.2m), which were primarily fees from AstraZeneca and Lilly for the management of development activities in China.
Other Ventures consolidated revenues increased 11% (15% at CER) to $262.6 million (2021: $236.5m), mainly due to higher sales of prescription drugs. This excludes the strong 11% (14% at CER) growth in non-consolidated revenues at SHPL of $370.6 million (2021: $332.6m).
Net Expenses for the year ended December 31, 2022 were $787.2 million compared to $550.7 million in 2021.
Costs of Revenues were $311.1 million (2021: $258.2m), the majority of which were the cost of third-party prescription drug products marketed through our profitable Other Ventures, as well as costs associated with ELUNATE, including the provision of promotion and marketing services to Lilly, and the costs for SULANDA and ORPATHYS which commenced commercial sales in July 2021;
R&D Expenses were $386.9 million (2021: $299.1m), which increased mainly as a result of an expansion in the active development of our novel oncology drug candidates. Our international clinical and regulatory operations in the U.S. and Europe incurred expenses of $170.9 million (2021: $140.1m), while R&D expenses in China were $216.0 million (2021: $159.0m);
SG&A Expenses[52] were $136.1 million (2021: $127.1m), which increased primarily due to higher staff costs and selling expenses to support the expansion of our Oncology/Immunology commercial operations; and
Other Items generated net income of $46.9 million (2021: $133.7m), which decreased primarily due to a one-off gain of $82.9 million in 2021 related to the divestment of HBYS.
Net Loss attributable to HUTCHMED for the year ended December 31, 2022 was $360.8 million compared to $194.6 million in 2021.
The net loss attributable to HUTCHMED in 2022 was $0.43 per ordinary share / $2.13 per ADS, compared to net loss attributable to HUTCHMED of $0.25 per ordinary share / $1.23 per ADS in 2021.
FINANCIAL SUMMARY
Condensed Consolidated Balance Sheets Data
(in $’000)
As of December 31,
2022 2021
Assets
Cash and cash equivalents and short-term investments 630,996 1,011,700
Accounts receivable 97,988 83,580
Other current assets 110,904 116,796
Property, plant and equipment 75,947 41,275
Investments in equity investees 73,777 76,479
Other non-current assets 39,833 42,831
Total assets 1,029,445 1,372,661
Liabilities and shareholders’ equity
Accounts payable 71,115 41,177
Other payables, accruals and advance receipts 264,621 210,839
Bank borrowings 18,104 26,905
Other liabilities 38,735 54,226
Total liabilities 392,575 333,147
Company’s shareholders’ equity 610,367 986,893
Non-controlling interests 26,503 52,621
Total liabilities and shareholders’ equity 1,029,445 1,372,661
Condensed Consolidated Statements of Operations Data
(in $’000, except share and per share data)
Year Ended December 31,
2022 2021
Revenues:
Oncology/Immunology – Marketed Products 124,642 76,429
Oncology/Immunology – R&D 39,202 43,181
Oncology/Immunology consolidated revenues 163,844 119,610
Other Ventures 262,565 236,518
Total revenues 426,409 356,128
Operating expenses:
Costs of revenues (311,103) (258,234)
Research and development expenses (386,893) (299,086)
Selling and general administrative expenses (136,106) (127,125)
Total operating expenses (834,102) (684,445)
(407,693) (328,317)
Gain on divestment of an equity investee – 121,310
Other expense, net (2,729) (8,733)
Loss before income taxes and equity in earnings of equity investees (410,422) (215,740)
Income tax benefit/(expense) 283 (11,918)
Equity in earnings of equity investees, net of tax 49,753 60,617
Net loss (360,386) (167,041)
Less: Net income attributable to non-controlling interests (449) (27,607)
Net loss attributable to HUTCHMED (360,835) (194,648)
Losses per share attributable to HUTCHMED – basic and diluted (US$ per share) (0.43) (0.25)
Number of shares used in per share calculation – basic and diluted 847,143,540 792,684,524
Losses per ADS attributable to HUTCHMED – basic and diluted (US$ per ADS) (2.13) (1.23)
Number of ADSs used in per share calculation – basic and diluted 169,428,708 158,536,905
FINANCIAL GUIDANCE
We provide financial guidance for 2023 below reflecting expected revenue growth of ELUNATE, SULANDA and ORPATHYS in China and out-licensing revenue. While we are not providing net cash flow guidance for 2023, we will extend our cash runway through partnering and strategic shifting to focus on the most advanced assets from our internal development pipeline.
2022
Actual 2023
Guidance
Oncology/Immunology consolidated revenues $163.8 million $450 – $550 million
Shareholders and investors should note that:
we do not provide any guarantee that the statements contained in the financial guidance will materialize or that the financial results contained therein will be achieved or are likely to be achieved; and
we have in the past revised our financial guidance and reference should be made to any announcements published by us regarding any updates to the financial guidance after the date of publication of this announcement.
Use of Non-GAAP Financial Measures and Reconciliation – References in this announcement to adjusted Group net cash flows excluding financing activities and financial measures reported at CER are based on non-GAAP financial measures. Please see the "Use of Non-GAAP Financial Measures and Reconciliation" below for further information relevant to the interpretation of these financial measures and reconciliations of these financial measures to the most comparable GAAP measures, respectively.
Conference call and audio webcast presentation scheduled today at 9 p.m. HKT / 1 p.m. GMT / 8 a.m. EST – After registering, investors may access a live audio webcast of the call via HUTCHMED’s website at www.hutch-med.com/event/.
Participants who wish to join the call and ask a question must register here. Upon registration, each participant will be provided with dial-in numbers and a unique PIN.
FINANCIAL STATEMENTS
HUTCHMED will today file with the U.S. Securities and Exchange Commission its Annual Report on Form 20-F.