On February 23, 2023 Dynavax Technologies Corporation (Nasdaq: DVAX), a commercial-stage biopharmaceutical company developing and commercializing innovative vaccines, reported financial results for the fourth quarter and the full year ending December 2022 (Press release, Dynavax Technologies, FEB 23, 2023, View Source [SID1234627602]).
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"In 2022, our team exceeded our strategic goals, achieving record HEPLISAV-B revenue, advancing our clinical pipeline and delivering orders of CpG 1018 adjuvant for the equivalent of hundreds of millions of COVID-19 vaccine doses," said Ryan Spencer, Chief Executive Officer of Dynavax. "Following a year of successful execution on our strategy, we are excited for 2023 and look forward to continuing our trend of significant and sustainable annual HEPLISAV-B revenue growth and overall advancement of our business focused on protecting patients worldwide from infectious diseases."
2023 FINANCIAL GUIDANCE
Dynavax anticipates full-year 2023 revenue and operating expenses to be in the ranges below:
HEPLISAV-B net product revenue between approximately $165 – $185 million
Research and development expenses between approximately $55 – $70 million
Selling, general and administrative expenses between approximately $135 – $155 million
BUSINESS UPDATES
HEPLISAV-B [Hepatitis B Vaccine (Recombinant), Adjuvanted]
HEPLISAV-B vaccine is the first and only adult hepatitis B vaccine approved in the U.S. and EU that enables series completion with only two doses in one month. Hepatitis B vaccination is universally recommended for adults aged 19-59 in the U.S.
HEPLISAV-B vaccine achieved record annual net product revenue of $125.9 million for 2022, compared to $61.9 million for 2021, representing annual growth of 104%.
HEPLISAV-B market share in prioritized Integrated Delivery Networks (IDNs) and Clinics increased to approximately 47%, with total market share increasing to approximately 35%, up from approximately 33% and 25%, respectively, at the end of 2021.
Dynavax believes it has begun to see a positive impact on HEPLISAV-B revenue from the expanded ACIP recommendation for adult hepatitis B vaccination which has the potential to expand the market to over $800 million by 2027 with HEPLISAV-B well-positioned to achieve a majority market-share.
CpG 1018 Adjuvant Supply for COVID-19 Vaccines
Dynavax has established a global portfolio of CpG 1018 adjuvant commercial supply agreements (CSAs) supporting the development of COVID-19 vaccines across a variety of vaccine platforms.
CpG 1018 adjuvant achieved annual net product revenue of $587.7 million for 2022, up 57% compared to $375.2 million for 2021.
Due to the successful execution on the pandemic commercial supply agreements and the resulting volume of partners’ overall stockpile, coupled with unknowns about the trajectory of the COVID-19 pandemic, Dynavax believes it will have minimal to as little as zero CpG 1018 adjuvant net product revenues in 2023.
Clinical Pipeline
Dynavax is advancing a pipeline of differentiated product candidates that leverage its CpG 1018 adjuvant, which has demonstrated its ability to enhance the immune response with a favorable tolerability profile in a wide range of clinical trials and real-world commercial use.
Tetanus, diphtheria and pertussis (Tdap) vaccine program:
In October, the Company presented adult and adolescent safety data from a Phase 1 clinical trial demonstrating the Tdap vaccine candidate was well tolerated without observed safety concerns. Immunogenicity in adults was consistent with the Company’s expectations and support its plan to continue advancement of this clinical program. These clinical results were presented at ID Week 2022.
Data from non-human primate challenge study is anticipated mid-2023.
The Company plans to initiate a human challenge study by the end of 2023.
Shingles vaccine program:
In January 2023, the Company reported top line results from the Phase 1 clinical trial designed to evaluate an investigational shingles vaccine, utilizing different regimens of CpG 1018 adjuvant.
The full Phase 1 data will be submitted for presentation at an upcoming medical meeting in the first half of 2023.
The Company plans to initiate a Phase 1/2 study in early 2024 to evaluate various dose levels of glycoprotein E (gE).
Plague vaccine candidate funded by the Defense Department (DoD):
Part 1 of the Phase 2 clinical trial evaluating the immunogenicity, safety, and tolerability in adults of a plague (rF1V) vaccine candidate adjuvanted with CpG 1018 was successfully completed in January 2023.
Both CpG 1018 adjuvanted arms met the Part 1 primary endpoint and demonstrated a greater than two-fold increase in antibodies over the alum adjuvanted control arm after two doses.
The DoD has approved continuing to Part 2 using a bedside mix of CpG 1018 with the alum adjuvanted rF1V plague vaccine.
FOURTH QUARTER AND FULL YEAR FINANCIAL HIGHLIGHTS
Total Revenue.
Total revenue for the fourth quarter of 2022 was $184.5 million, compared to $195.1 million for the fourth quarter of 2021.
Total revenue for the full year 2022 was $722.7 million, compared to $439.4 million for the full year 2021.
Product Revenue, Net.
HEPLISAV-B
HEPLISAV-B vaccine product revenue, net was $34.9 million for the fourth quarter of 2022, compared to $17.2 million for the fourth quarter of 2021.
HEPLISAV-B vaccine product revenue, net was $125.9 million for the full year 2022, compared to $61.9 million for the full year 2021, representing annual growth of 104%.
CpG 1018 Adjuvant Supply for COVID-19 Vaccines
CpG 1018 adjuvant product revenue, net was $147.2 million in the fourth quarter of 2022, compared to $177.4 million in the fourth quarter of 2021.
CpG 1018 adjuvant product revenue, net was $587.7 million for the full year 2022, compared to $375.2 million for the full year 2021.
Cost of Sales – Product. Cost of sales – product for the fourth quarter of 2022 increased to $77.5 million, compared to $74.0 million for the fourth quarter of 2021. Full year 2022 cost of sales – product was $262.2 million compared to $173.6 million for the full year 2021. The increase was due to higher sales volume for HEPLISAV-B and CpG 1018 adjuvant in 2022.
Research and Development Expenses (R&D). R&D expenses for the fourth quarter of 2022 increased to $12.9 million, compared to $11.1 million for the fourth quarter of 2021. Full year 2022 R&D expenses were $46.6 million compared to $32.2 million for the full year 2021. The increase was primarily driven by continued investments in our product candidates utilizing CpG 1018 adjuvant through pre-clinical and clinical collaborations and additional discovery efforts.
Selling, General, and Administrative Expenses (SG&A). SG&A expenses for the fourth quarter of 2022 increased to $31.0 million, compared to $29.2 million for the fourth quarter of 2021. Full year 2022 SG&A expenses were $131.4 million compared to $100.2 million for the full year 2021. The increase was primarily driven by higher compensation and related personnel costs and an overall increase in targeted commercial and marketing efforts to increase market share and maximize the Centers for Disease Control and Prevention’s Advisory Committee of Immunization Practices (ACIP) universal recommendation.
Net Income. GAAP net income was $67.7 million, or $0.53 per share (basic) and $0.45 per share (diluted) in the fourth quarter of 2022, compared to GAAP net income of $99.8 million, or $0.80 per share (basic) and $0.55 per share (diluted) in the fourth quarter of 2021. GAAP net income was $293.2 million, or $2.32 per share (basic) and $1.97 per share (diluted) for the full year 2022, compared to GAAP net income was $76.7 million, or $0.62 per share (basic) and $0.57 per share (diluted) for the full year 2021.
Cash and Marketable Securities. Cash and marketable securities were $624.4 million as of December 31, 2022.
Conference Call and Webcast Information
Dynavax will host a conference call and live audio webcast on Thursday, February 23, 2023, at 4:30 p.m. (ET)/1:30 p.m. (PT). The live audio webcast may be accessed through the "Events & Presentations" page on the "Investors" section of the Company’s website at View Source A replay of the webcast will be available for 30 days following the live event.
To dial into the call, participants will need to register for the call using the caller registration link. It is recommended that participants dial into the conference call or log into the webcast approximately 10 minutes prior to the call.
Important U.S. Product Information
HEPLISAV-B is indicated for the prevention of infection caused by all known subtypes of hepatitis B virus in adults aged 18 years and older.
For full U.S. Prescribing Information for HEPLISAV-B, click here.
Important U.S. Safety Information (ISI)
Do not administer HEPLISAV-B to individuals with a history of a severe allergic reaction (e.g., anaphylaxis) after a previous dose of any hepatitis B vaccine or to any component of HEPLISAV-B, including yeast.
Appropriate medical treatment and supervision must be available to manage possible anaphylactic reactions following administration of HEPLISAV-B.
Immunocompromised persons, including individuals receiving immunosuppressant therapy, may have a diminished immune response to HEPLISAV-B.
Hepatitis B has a long incubation period. HEPLISAV-B may not prevent hepatitis B infection in individuals who have an unrecognized hepatitis B infection at the time of vaccine administration.
The most common patient-reported adverse reactions reported within 7 days of vaccination were injection site pain (23% to 39%), fatigue (11% to 17%), and headache (8% to 17%).