On August 1, 2023 Outlook Therapeutics, Inc. (Nasdaq: OTLK), a biopharmaceutical company working to achieve FDA approval for the first ophthalmic formulation of bevacizumab for the treatment of wet AMD, reported that Russell Trenary, President and Chief Executive Officer of Outlook Therapeutics will participate in a fireside chat at the BTIG Virtual Biotechnology Conference 2023 on Monday, August 7, 2023 at 1:00 PM ET (Press release, Outlook Therapeutics, AUG 1, 2023, View Source [SID1234633592]).

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In addition to the fireside chat, management will be available to participate in virtual one-on-one meetings with qualified members of the investor community who are registered to attend the conference.

A live video webcast of the fireside chat will be accessible on the Events page in the Investors section of the Company’s website (outlooktherapeutics.com). The webcast replay will be archived for 90 days following the event.

On August 1, 2023 Merck (NYSE: MRK), known as MSD outside the United States and Canada, reported financial results for the second quarter of 2023 (Press release, Merck & Co, AUG 1, 2023, View Source [SID1234633591]).

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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

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"We continue to make great progress as we advance our broad and deep pipeline, raise the bar of innovation, and bring forward leading-edge science to save and improve lives around the world," said Robert M. Davis, chairman and chief executive officer, Merck. "We delivered robust underlying growth during the second quarter and are well positioned to achieve strong full-year results. I am proud of our talented, diverse and dedicated global team that continues to focus on creating value for patients and all our stakeholders now and well into the future."

Financial Summary

$ in millions, except EPS amounts

Second Quarter

2023

2022

Change

Change Ex-
Exchange

Sales

$15,035

$14,593

3%

7%

GAAP net (loss) income1

(5,975)

3,944

**N/M

N/M

Non-GAAP net (loss) income that excludes certain items1,2*

(5,220)

4,743

N/M

N/M

GAAP EPS

(2.35)

1.55

N/M

N/M

Non-GAAP EPS that excludes certain items2*

(2.06)

1.87

N/M

N/M

*Refer to table on page 6.

**Not meaningful

Generally Accepted Accounting Principles (GAAP) loss / earnings per share (EPS) assuming dilution was a loss per share of $2.35 for the second quarter of 2023. Non-GAAP loss per share was $2.06 for the second quarter of 2023. Both GAAP and non-GAAP loss per share were due to a charge for the acquisition of Prometheus Biosciences, Inc. (Prometheus) of $4.02 per share. Additionally, both GAAP and non-GAAP loss per share in the second quarter of 2023 were unfavorably affected by lower sales of LAGEVRIO and the impact of foreign exchange compared with the second quarter of 2022.

Non-GAAP EPS excludes acquisition- and divestiture-related costs and costs related to restructuring programs, as well as income and losses from investments in equity securities.

Year-to-date results can be found in the attached tables.

Second-Quarter Sales Performance

The following table reflects sales of the company’s top products and significant performance drivers.

Second Quarter

$ in millions

2023

2022

Change

Change Ex-
Exchange

Commentary

Total Sales

$15,035

$14,593

3%

7%

Pharmaceutical

13,457

12,756

6%

8%

Increase driven by growth in oncology, vaccines and hospital acute care, partially offset by lower sales in virology due to LAGEVRIO, and in diabetes. Excluding LAGEVRIO, growth of 14%. Excluding LAGEVRIO and unfavorable impact of foreign exchange, growth of 17%.

KEYTRUDA

6,271

5,252

19%

21%

Growth from continued strong global momentum in metastatic indications, including certain types of non-small cell lung cancer (NSCLC), renal cell carcinoma (RCC), head and neck squamous cell carcinoma and triple-negative breast cancer (TNBC), and increased uptake across earlier-stage indications, including certain types of neoadjuvant/adjuvant TNBC in the U.S.

GARDASIL / GARDASIL 9

2,458

1,674

47%

53%

Growth largely due to strong global demand, particularly in China.

JANUVIA / JANUMET

864

1,233

-30%

-28%

Decline primarily due to generic competition in several international markets, particularly in Europe, and lower demand and pricing in the U.S.

PROQUAD, M-M-R II and VARIVAX

582

578

1%

1%

Relatively flat compared with prior year.

BRIDION

502

426

18%

19%

Growth primarily due to increased demand, particularly in the U.S., reflecting an increase in market share among neuromuscular blockade reversal agents.

Lynparza*

310

275

13%

15%

Growth driven primarily by increased demand in certain international markets.

Lenvima*

242

231

5%

6%

Growth primarily due to higher demand in the U.S., partially offset by lower demand in China.

LAGEVRIO

203

1,177

-83%

-82%

Decrease largely attributable to lower sales in Japan and nonrecurrence of sales in the U.K.

SIMPONI

180

181

-1%

-1%

Relatively flat compared with prior year.

VAXNEUVANCE

168

12

***N/M

N/M

Growth driven largely by continued uptake in pediatric indication following launch in the U.S.

Animal Health

1,456

1,467

-1%

2%

Excluding unfavorable impact of foreign exchange, growth primarily driven by higher pricing in both Livestock and Companion Animal product portfolios.

Livestock

807

826

-2%

2%

Excluding unfavorable impact of foreign exchange, growth due to higher pricing, as well as higher demand for swine and poultry products, partially offset by lower demand for ruminant products, due in part to reduced herd sizes.

Companion Animal

649

641

1%

2%

Growth driven by higher pricing, including for the BRAVECTO line of products, partially offset by supply challenges for certain companion animal vaccines. Sales of BRAVECTO were $326 million and $309 million in the current and prior quarters, respectively, which represented growth of 5% or 7% excluding unfavorable impact of foreign exchange.

Other Revenues**

122

370

-67%

-19%

Decline primarily due to impact of revenue hedging. Excluding unfavorable impact of foreign exchange, decline due to lower royalties and milestone payments received for out-licensing arrangements.

*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

**Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities.

***Not meaningful

Second-Quarter Expense, EPS and Related Information

The table below presents selected expense information.

$ in millions

GAAP

Acquisition-
and
Divestiture-
Related Costs3

Restructuring
Costs

(Income)
Loss From
Investments
in Equity
Securities

Non-
GAAP2

Second Quarter 2023

Cost of sales

$4,024

$467

$32

$-

$3,525

Selling, general and administrative

2,702

25

52

–

2,625

Research and development

13,321

9

1

–

13,311

Restructuring costs

151

–

151

–

–

Other (income) expense, net

172

(3)

–

194

(19)

Second Quarter 2022

Cost of sales

$4,216

$451

$67

$-

$3,698

Selling, general and administrative

2,512

65

27

–

2,420

Research and development

2,798

12

22

–

2,764

Restructuring costs

142

–

142

–

–

Other (income) expense, net

438

2

–

234

202

GAAP Expense, EPS and Related Information

Gross margin was 73.2% for the second quarter of 2023 compared with 71.1% for the second quarter of 2022. The increase was primarily due to lower LAGEVRIO sales, which have a low gross margin, as well as the favorable impact of product mix. The gross margin increase was partially offset by the unfavorable impact of foreign exchange.

Selling, general and administrative (SG&A) expenses were $2.7 billion in the second quarter of 2023, an increase of 8% compared with the second quarter of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, and higher promotional spending, partially offset by lower acquisition- and divestiture- related costs and the favorable impact of foreign exchange.

Research and development (R&D) expenses were $13.3 billion in the second quarter of 2023 compared with $2.8 billion in the second quarter of 2022. The increase was primarily due to a $10.2 billion charge for the acquisition of Prometheus. The remaining increase was driven by higher compensation and benefit costs, reflecting in part increased headcount, higher investments in discovery research and early drug development, and higher clinical development spending.

Other (income) expense, net, was $172 million of expense in the second quarter of 2023 compared with $438 million of expense in the second quarter of 2022, primarily due to lower net losses from investments in equity securities and lower pension settlement costs.

The income tax provision for the second quarter of 2023 was $637 million on a pretax loss of $5.3 billion, resulting in an effective tax rate of (11.9)%. This effective tax rate includes a 25.1 percentage point unfavorable impact of the charge for the acquisition of Prometheus, for which no tax benefit was recorded.

GAAP loss per share was $2.35 for the second quarter of 2023 compared with earnings per share of $1.55 for the second quarter of 2022.

Non-GAAP Expense, EPS and Related Information

Non-GAAP gross margin was 76.6% for the second quarter of 2023 compared with 74.7% for the second quarter of 2022. The increase was primarily due to lower LAGEVRIO sales, which have a low gross margin, as well as the favorable impact of product mix. The gross margin increase was partially offset by the unfavorable impact of foreign exchange.

Non-GAAP SG&A expenses were $2.6 billion in the second quarter of 2023, an increase of 8% compared with the second quarter of 2022. The increase was primarily due to higher administrative costs, including higher compensation and benefit costs, and higher promotional spending, partially offset by the favorable impact of foreign exchange.

Non-GAAP R&D expenses were $13.3 billion in the second quarter of 2023 compared with $2.8 billion in the second quarter of 2022. The increase was primarily due to a $10.2 billion charge for the acquisition of Prometheus. The remaining increase was driven by higher compensation and benefit costs, reflecting in part increased headcount, higher investments in discovery research and early drug development, and higher clinical development spending.

Non-GAAP other (income) expense, net, was $19 million of income in the second quarter of 2023 compared with $202 million of expense in the second quarter of 2022, primarily due to lower pension settlement costs.

The non-GAAP income tax provision for the second quarter of 2023 was $810 million on a pretax loss of $4.4 billion, resulting in a non-GAAP effective tax rate of (18.4)%. This effective tax rate includes a 32.5 percentage point unfavorable impact of the charge for the acquisition of Prometheus, for which no tax benefit was recorded.

Non-GAAP loss per share was $2.06 for the second quarter of 2023 compared with earnings per share of $1.87 for the second quarter of 2022.

A reconciliation of GAAP to non-GAAP net (loss) income and EPS is provided in the table that follows.

Second Quarter

$ in millions, except EPS amounts

2023

2022

EPS

GAAP EPS

$(2.35)

$1.55

Difference

0.29

0.32

Non-GAAP EPS that excludes items listed below2

$(2.06)

$1.87

Net (Loss) Income

GAAP net (loss) income1

$(5,975)

$3,944

Difference

755

799

Non-GAAP net (loss) income that excludes items listed below1,2

$(5,220)

$4,743

Excluded Items:

Acquisition- and divestiture-related costs3

$498

$530

Restructuring costs

236

258

Loss from investments in equity securities

194

234

Increase to net loss / decrease to net income before taxes

928

1,022

Estimated income tax (benefit) expense

(173)

(223)

Increase to net loss / decrease to net income

$755

$799

Pipeline and Portfolio Highlights

Merck’s expansive research efforts resulted in continued progress across its broad pipeline and portfolio. In oncology, the company reached regulatory milestones across different stages of cancer and shared positive results from a range of clinical trials. Notably, Merck presented data on four approved medicines and two pipeline candidates in more than 25 types of cancer at the 2023 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting, including investigational data for KEYTRUDA that demonstrates its progress in earlier stages of disease.

Further, in vaccines, Merck announced positive topline results demonstrating that V116, an investigational 21-valent pneumococcal conjugate vaccine specifically designed for adults, met key immunogenicity and safety endpoints in two Phase 3 trials. In cardiovascular, Merck submitted a Biologics License Application to the U.S. Food and Drug Administration (FDA) for sotatercept, Merck’s novel investigational activin signaling inhibitor for the treatment of adults with pulmonary arterial hypertension (World Health Organization Group 1). In chronic cough, Merck received an acceptance from the FDA for the resubmission of the New Drug Application for gefapixant and assigned a target action date of Dec. 27, 2023.

Merck also completed the acquisition of Prometheus, which will accelerate the company’s growing presence in immunology and add diversity to its pipeline. Prometheus’ leading clinical candidate, MK-7240, formerly known as PRA-023, creates an opportunity for Merck to transform the treatment of immune-mediated diseases.

Notable recent news releases on Merck’s pipeline and portfolio are provided in the table that follows.

Oncology

FDA Approved Lynparza Plus Abiraterone and Prednisone or Prednisolone for Treatment of Adult Patients With BRCA-Mutated Metastatic Castration-Resistant Prostate Cancer

(Read Announcement)

FDA Accepted Application for Merck’s KEYTRUDA Plus Chemotherapy as Treatment for Advanced or Unresectable Biliary Tract Cancer

(Read Announcement)

Merck’s KEYTRUDA Plus Chemotherapy Before Surgery and Continued as a Single Agent After Surgery Reduced the Risk of Event-Free Survival Events by 42% Versus Pre-Operative Chemotherapy in Resectable Stage II, IIIA or IIIB NSCLC

(Read Announcement)

Merck and Moderna Initiated Phase 3 Study Evaluating V940 (mRNA-4157) In Combination With KEYTRUDA for Adjuvant Treatment of Patients With Resected High-Risk (Stage IIB-IV) Melanoma

(Read Announcement)

Merck and Moderna Announced mRNA-4157 (V940) in Combination With KEYTRUDA Demonstrated a Statistically Significant and Clinically Meaningful Improvement in Distant Metastasis-Free Survival in Patients With High-Risk Stage III/IV Melanoma Following Complete Resection Versus KEYTRUDA

(Read Announcement)

KEYTRUDA Plus Chemotherapy Significantly Improved Overall Survival Versus Chemotherapy Alone as First-Line Treatment for Unresectable Advanced Pleural Mesothelioma

(Read Announcement)

KEYTRUDA Plus Lenvima Demonstrated Long-Term, Durable Survival Benefit Versus Sunitinib as First-Line Treatment for Patients With Advanced RCC

(Read Announcement)

Merck Announced Phase 3 KEYNOTE-A18 Trial Met Primary Endpoint of Progression-Free Survival (PFS) in Patients With Newly Diagnosed High-Risk Locally Advanced Cervical Cancer

(Read Announcement)

KEYTRUDA Plus Trastuzumab and Chemotherapy Met Primary Endpoint of PFS as First-Line Treatment in Patients With HER2-Positive Advanced Gastric or Gastroesophageal Junction Adenocarcinoma

(Read Announcement)

Vaccines

Merck Announced V116, an Investigational, 21-Valent Pneumococcal Conjugate Vaccine Specifically Designed for Adults, Met Key Immunogenicity and Safety Endpoints in Two Phase 3 Trials

(Read Announcement)

Other Pipeline Updates

FDA Approved New Indication for Merck’s PREVYMIS for Prevention of Cytomegalovirus Disease in High-Risk Adult Kidney Transplant Recipients

(Read Announcement)

Merck Presented Phase 2a Data for Efinopegdutide (MK-6024), an Investigational GLP-1/Glucagon Receptor Co-agonist, in Patients With Nonalcoholic Fatty Liver Disease, at EASL 2023; Additionally, Efinopegdutide Was Granted Fast Track Designation by the FDA for the Treatment of Nonalcoholic Steatohepatitis (NASH)

(Read Announcement)

Merck Received Positive European Union Committee for Medicinal Products for Human Use (CHMP) Opinion for Gefapixant

(Read Announcement)

Full-Year 2023 Financial Outlook

The following table summarizes the company’s full-year financial outlook.

Sales*

$58.6 to $59.6 billion

Non-GAAP Gross margin2

Approximately 77%

Non-GAAP Operating expenses2**

$34.0 to $34.6 billion

Non-GAAP Other (income) expense, net2

Approximately $100 million

Non-GAAP Effective tax rate2***

30.5% to 31.5%

Non-GAAP EPS2****

$2.95 to $3.05

Share count (assuming dilution)

2.55 billion

*Includes approximately $1.0 billion of LAGEVRIO sales. The company does not have any non-GAAP adjustments to sales.

**Includes an aggregate $11.6 billion of R&D expenses related to the Prometheus and Imago BioSciences, Inc. (Imago) acquisitions and upfront payment for the license and collaboration agreement with Kelun-Biotech (a holding subsidiary of Sichuan Kelun Pharmaceutical Co., Ltd). Outlook does not assume any additional significant potential business development transactions.

***Includes a negative impact of 15 percentage points from the one-time charge for the acquisition of Prometheus.

****Includes $4.53 of one-time charges related to the Prometheus and Imago acquisitions and upfront payment to Kelun-Biotech.

Merck has not provided a reconciliation of forward-looking non-GAAP gross margin, non-GAAP operating expenses, non-GAAP other (income) expense, net, non-GAAP effective tax rate and non-GAAP EPS to the most directly comparable GAAP measures, given it cannot predict with reasonable certainty the amounts necessary for such a reconciliation, including intangible asset impairment charges, legal settlements, and gains and losses from investments in equity securities either owned directly or through ownership interests in investment funds, without unreasonable effort. These items are inherently difficult to forecast and could have a significant impact on the company’s future GAAP results.

Merck continues to experience strong global demand for key growth products, particularly in oncology and vaccines. As a result, Merck is raising and narrowing its full-year sales outlook. Merck now expects full-year sales to be between $58.6 billion and $59.6 billion, including a negative impact of foreign exchange of approximately 2 percentage points, at mid-July 2023 exchange rates. This full-year outlook continues to include approximately $1.0 billion of LAGEVRIO sales.

Merck’s full-year non-GAAP effective income tax rate is expected to be between 30.5% and 31.5%, including an unfavorable impact of approximately 15 percentage points from the non-tax deductible one-time charge for the acquisition of Prometheus.

Merck now expects its full-year non-GAAP EPS to be between $2.95 and $3.05, including a negative impact of foreign exchange of approximately 5 percentage points, at mid-July 2023 exchange rates. This revised non-GAAP EPS range reflects the following, which were not previously included in the outlook:

Additional strength in the business of approximately $0.24 per share.
A charge of $10.2 billion, or $4.02 per share, for the acquisition of Prometheus.
Estimated 2023 expense of approximately $0.14 per share to be incurred to finance the Prometheus acquisition and to advance the acquired assets.
A less than 1%, or approximately $0.02 per share, incremental negative impact of foreign exchange.
The non-GAAP EPS range excludes acquisition- and divestiture-related costs and costs related to restructuring programs, as well as income and losses from investments in equity securities, and a previously disclosed charge related to settlements with certain plaintiffs in the Zetia antitrust litigation.

Earnings Conference Call

Investors, journalists and the general public may access a live audio webcast of the earnings conference call on Tuesday, Aug. 1, at 8 a.m. ET via this weblink. A replay of the webcast, along with the sales and earnings news release, supplemental financial disclosures, prepared remarks and slides highlighting the results, will be available at www.merck.com.

All participants may join the call by dialing (888) 769-8514 (U.S. and Canada Toll-Free) or (517) 308-9208 and using the access code 8206435.

On August 1, 2023 MannKind Corporation (Nasdaq: MNKD), a company focused on the development and commercialization of inhaled therapeutic products and devices for patients with endocrine and orphan lung diseases, reported that its Chief Executive Officer, Michael Castagna, PharmD, will participate in one-on-one meetings at the 2023 Wedbush PacGrow Healthcare Conference on Tuesday, August 8, 2023 at the Lotte Palace in New York City (Press release, Mannkind, AUG 1, 2023, View Source [SID1234633590]).

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If you have interest in participating in the 2023 Wedbush PacGrow Healthcare Conference, please reach out to your Wedbush representative.

On August 1, 2023 TG Therapeutics, Inc. (NASDAQ: TGTX) reported its financial results for the second quarter ended June 30, 2023, along with recent company developments, and a business outlook for 2023 (Press release, TG Therapeutics, AUG 1, 2023, View Source [SID1234633589]).

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Michael S. Weiss, the Company’s Chairman and Chief Executive Officer, stated, "We are pleased to report our second quarter 2023 results, representing our first full quarter of BRIUMVI sales, which exceeded our expectations. It’s been gratifying to see BRIUMVI adopted by such a broad range of MS centers and providers so early into our launch and we are humbled when we hear positive feedback on patients’ experience with BRIUMVI. With its glycoengineering for efficient B-cell depletion, lowest reported annualized relapse rates of any CD20 agent in RMS Phase 3 trials and rapid and reliable 1-hour infusion, a number of providers have already made BRIUMVI their CD20 of choice in RMS. I believe our quarterly performance showcases the unwavering dedication of our team, and the potential of BRIUMVI, to improve the lives of patients with MS." Mr. Weiss continued, "With an ex-U.S. partner in place, we can continue to focus our now enhanced resources on our U.S. commercial launch. I believe our team has executed well on our early launch plan and we are looking forward to building on this momentum as we move forward with the next phase of our launch strategy."

Recent Highlights & Developments

United States (U.S.) Commercialization of BRIUMVI (ublituximab-xiiy)

● Received U.S. Food and Drug Administration (FDA) approval of BRIUMVI, for the treatment of relapsing forms of multiple sclerosis (RMS), to include clinically isolated syndrome, relapsing-remitting disease, and active secondary progressive disease, and commercially launched BRIUMVI in the U.S. on January 26, 2023, making it available for patients and physicians.
● Achieved $16 million in BRIUMVI net sales for the second quarter 2023, total net product revenue of $23.8 million since launch.
● Secured payor coverage policies for approximately 80% of covered lives across the U.S.
● Over 800 BRIUMVI prescriptions in the second quarter of 2023, marking over 1200 prescriptions since launch, from more than 340 healthcare providers at more than 225 centers.
● Received a permanent J-Code (J2329) for BRIUMVI from the U.S. Centers for Medicare & Medicaid Services (CMS), which became effective July 1, 2023.

European Commercialization of BRIUMVI

● Received European Commission (EC) approval of BRIUMVI, for the treatment of adult patients with RMS who have active disease defined by clinical or imaging features, on June 1, 2023.
● Announced an agreement with Neuraxpharm for the ex-U.S. commercialization of BRIUMVI in RMS today, August 1, 2023. Agreement terms include a total deal size of $645 million with over $150 million in upfront and near-term milestones, tiered double-digit royalties up to 30% and an option to buy-back all rights under the commercialization agreement for a period of two years in the event of an acquisition of TG.

General Business

● Strengthened our cash position with current pro-forma cash of approximately $285 million.
● Presented additional data, including new analyses, from the ULTIMATE I and II Phase 3 trials at the 2023 Consortium of Multiple Sclerosis Centers (CMSC) annual meeting.

Key Objectives for 2023

● Continue to build upon the U.S. commercial launch of BRIUMVI in RMS
● Continue to increase access to BRIUMVI
● Continue to generate and present additional clinical trial data for BRIUMVI in RMS

Financial Results for the Three and Six Months Ended June 30, 2023

● Product Revenue, Net: Product revenue, net was approximately $16.0 million and $23.8 million for the three and six months ended June 30, 2023, compared to $0.6 million and $2.5 million for the three and six months ended June 30, 2022. Product revenue, net for the three and six months ended June 30, 2023, consisted of net product sales of BRIUMVI in the U.S., which was commercially launched in late January 2023. Product revenue, net for the three and six months ended June 30, 2022, consisted of net product sales of UKONIQ (umbralisib), which was withdrawn from the U.S. market in May of 2022.

● R&D Expenses: Total research and development (R&D) expense was $28.1 million and $44.0 million for the three and six months ended June 30, 2023, compared to $26.9 million and $74.9 million for the three and six months ended June 30, 2022. The decrease in R&D expense during the six months ended June 30, 2023 was primarily attributable to reduced manufacturing expense and clinical trial related expenses, offset by an increase in license milestone expense of approximately $6.0 million during the six months ended June 30, 2023. Prior to the approval of BRIUMVI, manufacturing costs pertaining to BRIUMVI were expensed to R&D expense in the period incurred, and following approval are reflected in inventory.

● SG&A Expenses: Total selling, general and administrative (SG&A) expense was $30.7 million and $58.8 million for the three and six months ended June 30, 2023, compared to $12.6 million and $33.2 million for the three and six months ended June 30, 2022. The increase was primarily due to non-cash compensation SG&A expenses incurred, and other costs, including personnel, associated with the commercialization of BRIUMVI during the three and six months ended June 30, 2023.

● Net Loss: Net loss was $47.6 million and $86.8 million for the three and six months ended June 30, 2023, compared to $40.5 million and $109.5 million for the three and six months ended June 30, 2022. Excluding non-cash compensation, the net loss for the three and six months ended June 30, 2023, was approximately $35.1 million and $67.5 million, compared to a net loss of $41.5 million and $108.4 million for the three and six months ended June 30, 2022.

● Cash Position and Financial Guidance: Cash, cash equivalents and investment securities were $144.9 million as of June 30, 2023. We anticipate that our cash, cash equivalents and investment securities as of June 30, 2023, combined with the upfront payment of $140.0 million received as part of our ex-U.S. commercialization agreement and projected revenues associated with the sale of BRIUMVI in the U.S. and ex-U.S., will be sufficient to fund our planned operations for the foreseeable future.

CONFERENCE CALL INFORMATION
The Company will host a conference call today, August 1, 2023, at 8:30 AM ET, to discuss the Company’s financial results from the second quarter, ended June 30, 2023, the Neuraxpharm ex-U.S. commercialization agreement, and provide a business outlook for the remainder of 2023.

To participate in the conference call, please call 1-877-407-8029 (U.S.), 1-201-689-8029 (outside the U.S.), Conference Title: TG Therapeutics. A live audio webcast will be available on the Events page, located within the Investors & Media section, of the Company’s website at View Source An audio recording of the conference call will also be available for a period of 30 days after the call.

ABOUT BRIUMVI(ublituximab-xiiy) 150 mg/6 mL Injection for IV
BRIUMVI is a novel monoclonal antibody that targets a unique epitope on CD20-expressing B-cells. Targeting CD20 using monoclonal antibodies has proven to be an important therapeutic approach for the management of autoimmune disorders, such as RMS. BRIUMVI is uniquely designed to lack certain sugar molecules normally expressed on the antibody. Removal of these sugar molecules, a process called glycoengineering, allows for efficient B-cell depletion at low doses.

BRIUMVI is indicated for the treatment of adults with relapsing forms of multiple sclerosis (RMS), to include clinically isolated syndrome, relapsing-remitting disease, and active secondary progressive disease.

A list of authorized specialty distributors can be found at www.briumvi.com.

IMPORTANT SAFETY INFORMATION

Contraindications: BRIUMVI is contraindicated in patients with:

● Active Hepatitis B Virus infection
● A history of life-threatening infusion reaction to BRIUMVI

WARNINGS AND PRECAUTIONS

Infusion Reactions: BRIUMVI can cause infusion reactions, which can include pyrexia, chills, headache, influenza-like illness, tachycardia, nausea, throat irritation, erythema, and an anaphylactic reaction. In MS clinical trials, the incidence of infusion reactions in BRIUMVI-treated patients who received infusion reaction-limiting premedication prior to each infusion was 48%, with the highest incidence within 24 hours of the first infusion. 0.6% of BRIUMVI-treated patients experienced infusion reactions that were serious, some requiring hospitalization.

Observe treated patients for infusion reactions during the infusion and for at least one hour after the completion of the first two infusions unless infusion reaction and/or hypersensitivity has been observed in association with the current or any prior infusion. Inform patients that infusion reactions can occur up to 24 hours after the infusion. Administer the recommended pre-medication to reduce the frequency and severity of infusion reactions. If life-threatening, stop the infusion immediately, permanently discontinue BRIUMVI, and administer appropriate supportive treatment. Less severe infusion reactions may involve temporarily stopping the infusion, reducing the infusion rate, and/or administering symptomatic treatment.

Infections: Serious, life-threatening or fatal, bacterial and viral infections have been reported in BRIUMVI-treated patients. In MS clinical trials, the overall rate of infections in BRIUMVI-treated patients was 56% compared to 54% in teriflunomide-treated patients. The rate of serious infections was 5% compared to 3% respectively. There were 3 infection-related deaths in BRIUMVI-treated patients. The most common infections in BRIUMVI-treated patients included upper respiratory tract infection (45%) and urinary tract infection (10%). Delay BRIUMVI administration in patients with an active infection until the infection is resolved.

Consider the potential for increased immunosuppressive effects when initiating BRIUMVI after immunosuppressive therapy or initiating an immunosuppressive therapy after BRIUMVI.

Hepatitis B Virus (HBV) Reactivation: HBV reactivation occurred in an MS patient treated with BRIUMVI in clinical trials. Fulminant hepatitis, hepatic failure, and death caused by HBV reactivation have occurred in patients treated with anti-CD20 antibodies. Perform HBV screening in all patients before initiation of treatment with BRIUMVI. Do not start treatment with BRIUMVI in patients with active HBV confirmed by positive results for HBsAg and anti-HB tests. For patients who are negative for surface antigen [HBsAg] and positive for HB core antibody [HBcAb+] or are carriers of HBV [HBsAg+], consult a liver disease expert before starting and during treatment.

Progressive Multifocal Leukoencephalopathy (PML): Although no cases of PML have occurred in BRIUMVI-treated MS patients, JCV infection resulting in PML has been observed in patients treated with other anti-CD20 antibodies and other MS therapies.

If PML is suspected, withhold BRIUMVI and perform an appropriate diagnostic evaluation. Typical symptoms associated with PML are diverse, progress over days to weeks, and include progressive weakness on one side of the body or clumsiness of limbs, disturbance of vision, and changes in thinking, memory, and orientation leading to confusion and personality changes.

MRI findings may be apparent before clinical signs or symptoms; monitoring for signs consistent with PML may be useful. Further investigate suspicious findings to allow for an early diagnosis of PML, if present. Following discontinuation of another MS medication associated with PML, lower PML-related mortality and morbidity have been reported in patients who were initially asymptomatic at diagnosis compared to patients who had characteristic clinical signs and symptoms at diagnosis.

If PML is confirmed, treatment with BRIUMVI should be discontinued.

Vaccinations: Administer all immunizations according to immunization guidelines: for live or live-attenuated vaccines at least 4 weeks and, whenever possible at least 2 weeks prior to initiation of BRIUMVI for non-live vaccines. BRIUMVI may interfere with the effectiveness of non-live vaccines. The safety of immunization with live or live-attenuated vaccines during or following administration of BRIUMVI has not been studied. Vaccination with live virus vaccines is not recommended during treatment and until B-cell repletion.

Vaccination of Infants Born to Mothers Treated with BRIUMVI During Pregnancy: In infants of mothers exposed to BRIUMVI during pregnancy, assess B-cell counts prior to administration of live or live-attenuated vaccines as measured by CD19+ B-cells. Depletion of B-cells in these infants may increase the risks from live or live-attenuated vaccines. Inactivated or non-live vaccines may be administered prior to B-cell recovery. Assessment of vaccine immune responses, including consultation with a qualified specialist, should be considered to determine whether a protective immune response was mounted.

Fetal Risk: Based on data from animal studies, BRIUMVI may cause fetal harm when administered to a pregnant woman. Transient peripheral B-cell depletion and lymphocytopenia have been reported in infants born to mothers exposed to other anti-CD20 B-cell depleting antibodies during pregnancy. A pregnancy test is recommended in females of reproductive potential prior to each infusion. Advise females of reproductive potential to use effective contraception during BRIUMVI treatment and for 6 months after the last dose.

Reduction in Immunoglobulins: As expected with any B-cell depleting therapy, decreased immunoglobulin levels were observed. Decrease in immunoglobulin M (IgM) was reported in 0.6% of BRIUMVI-treated patients compared to none of the patients treated with teriflunomide in RMS clinical trials. Monitor the levels of quantitative serum immunoglobulins during treatment, especially in patients with opportunistic or recurrent infections, and after discontinuation of therapy until B-cell repletion. Consider discontinuing BRIUMVI therapy if a patient with low immunoglobulins develops a serious opportunistic infection or recurrent infections, or if prolonged hypogammaglobulinemia requires treatment with intravenous immunoglobulins.

Most Common Adverse Reactions: The most common adverse reactions in RMS trials (incidence of at least 10%) were infusion reactions and upper respiratory tract infections.

Physicians, pharmacists, or other healthcare professionals with questions about BRIUMVI should visit www.briumvi.com.

The full SmPC approved in the EU for BRIUMVI can be found here Briumvi | European Medicines Agency (europa.eu).

ABOUT BRIUMVI PATIENT SUPPORT in the U.S.

BRIUMVI Patient Support is a flexible program designed by TG Therapeutics to support U.S. patients through their treatment journey in a way that works best for them. More information about the BRIUMVI Patient Support program can be accessed at www.briumvipatientsupport.com.

ABOUT MULTIPLE SCLEROSIS

Relapsing multiple sclerosis (RMS) is a chronic demyelinating disease of the central nervous system (CNS) and includes people with relapsing-remitting multiple sclerosis (RRMS) and people with secondary progressive multiple sclerosis (SPMS) who continue to experience relapses. RRMS is the most common form of multiple sclerosis (MS) and is characterized by episodes of new or worsening signs or symptoms (relapses) followed by periods of recovery. It is estimated that nearly 1 million people are living with MS in the United States and approximately 85% are initially diagnosed with RRMS.1,2 The majority of people who are diagnosed with RRMS will eventually transition to SPMS, in which they experience steadily worsening disability over time. Worldwide, more than 2.3 million people have a diagnosis of MS.

On August 1, 2023 Leidos Holdings, Inc. (NYSE: LDOS), a FORTUNE 500 science and technology leader, reported financial results for the second quarter of fiscal year 2023 (Press release, Leidos, AUG 1, 2023, View Source [SID1234633588]).

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Thomas Bell, Leidos Chief Executive Officer, commented, "It is my honor to lead Leidos into its second decade of top-line growth, which we plan to complement with a sharper focus on earnings and cash through disciplined financial management. This focus is underscored by the strong second quarter results announced today, characterized by record revenues and adjusted EBITDA. Propelling our future performance, we will remain dedicated to resolving with pace the most challenging problems faced by our customers, our nation, and its allies—an approach that distinctly sets Leidos apart."

Summary Operating Results

Three Months Ended

(in millions, except margin and per share amounts)

June 30, 2023

July 1, 2022

Revenues

$ 3,838

$ 3,597

Net income

$ 210

$ 172

Net income margin

5.5 %

4.8 %

Diluted earnings per share (EPS)

$ 1.50

$ 1.24

Non-GAAP Measures*:

Adjusted EBITDA

$ 420

$ 366

Adjusted EBITDA margin

10.9 %

10.2 %

Non-GAAP diluted EPS

$ 1.80

$ 1.59

* Non-GAAP financial measures should be considered in addition to, but not as a substitute for, the information
provided in accordance with GAAP. Management believes that these non-GAAP measures provide another
measure of Leidos’ results of operations and financial condition, including its ability to comply with financial
covenants. See Non-GAAP Financial Measures at the end of this press release for more information and a
reconciliation of our selected reported results to these non-GAAP measures.

Revenues for the quarter were $3.84 billion, up 7% compared to the second quarter of 2022. Revenues grew year-over-year primarily due to increased demand across all customer segments, especially for digital modernization, hypersonics, and medical examinations solutions.

Net income was $210 million and diluted EPS was $1.50. Net income and diluted EPS were up 22% and 21% year-over-year, respectively. Adjusted EBITDA was $420 million for the second quarter, up 15% year-over-year. Adjusted EBITDA margin of 10.9% increased from 10.2% in the second quarter of 2022. Non-GAAP net income was $252 million for the second quarter, up 15% year-over-year, and non-GAAP diluted EPS for the quarter was $1.80, up 13% year-over-year.

The primary drivers of increased earnings were improved business mix and program execution within each segment as well as reduced indirect spending across the company.

Cash Flow Summary

In the second quarter Leidos generated $164 million of net cash provided by operating activities and used $44 million in investing activities and $164 million in financing activities. Net cash provided by operating activities benefited from strong collections and working capital management. Days Sales Outstanding (DSO) for the quarter was 59, a 3-day improvement from the first quarter of 2023.

Investing activities consisted primarily of $40 million in property, equipment and software payments, which resulted in quarterly free cash flow of $124 million. Financing activities were driven by the payment of the remaining $320 million of principal on the 364-day term loan credit agreement from May 6, 2022, netted against borrowings of $200 million of commercial paper notes. In addition, Leidos returned $50 million to shareholders in the second quarter as part of its regular quarterly cash dividend program. As of June 30, 2023, Leidos had $329 million in cash and cash equivalents and $4.9 billion of debt.

On July 28, 2023, the Leidos Board of Directors declared a cash dividend of $0.36 per share to be paid on September 29, 2023, to stockholders of record at the close of business on September 15, 2023.

Business Development

Net bookings totaled $2.9 billion in the quarter, representing a book-to-bill ratio of 0.8. As a result, backlog at the end of the quarter was $34.2 billion, of which $8.3 billion was funded. Included in the quarterly bookings were several notable awards:

Common Hypersonics Glide Body (CHGB) Follow-On. The U.S. Army Program Executive Office Missiles and Space (PEO MS) awarded Leidos a four-year, $428 million prime contract to develop and test new CHGB prototypes. Under this follow-on, the Dynetics team expects to build up to 31 new CHGB prototypes to support Army and Navy requirements.
Centers for Medicare and Medicaid Services (CMS) Office of Information Technology End-User Centric IT Support. The CMS OIT awarded Leidos a contract with a total estimated value of $197 million over five years to provide seat-management services for CMS OIT employees and contractors and their personal computers, mobile devices and productivity services enabled through those devices. Under the contract, Leidos will continue to deliver engineering, innovation and accessibility compliance support to an onsite and remote workforce with a focus on fostering a positive end-user experience.
Royal Saudi Air Force (RSAF) Contractor Engineering & Technical Services Follow-On (CETS V). The RSAF awarded Leidos a contract with a total estimated value of $105 million over four years to maintain and enhance RSAF Command, Control, Communications, Computers and Intelligence (C4I) systems, including ground communications, radars, and IT systems, and support various aircraft platforms and systems support programs.
Defense Enclave Services (DES) DoDNet Planning and Design (DPAD). The Defense Information Systems Agency (DISA) awarded Leidos a DES task order with a total estimated value of $69 million over 55 months to migrate 14 Defense Agencies and Field Activities (DAFAs) to DoDNet. This award is the second task order under the DES effort to consolidate enterprise IT services and provide standardized, responsive and cost-effective solutions for more than 370,000 users spanning 22 Department of Defense (DoD) agencies and field activities with over 500 sites both in the U.S. and abroad. The work will focus on mission value and user experience, while improving cybersecurity, network availability and reliability.
In addition, Leidos expanded its partnership network in support of technology offerings. As part of a Trusted Generative AI campaign, Leidos strengthened its collaboration with industry leaders, harnessing shared expertise to drive innovation in AI. These partnerships allow Leidos to work with the most advanced models available—from OpenAI’s GPT-4 through Microsoft to Google’s Bard and Amazon’s Bedrock. This collaboration enables secure environments that protect sensitive data while leveraging the power of Generative AI. In addition, Leidos and Aalyria have partnered to integrate Aalyria’s Spacetime networking technology with Leidos’ global-scale network management and protection solutions for critical government missions. By integrating Spacetime into new and existing solutions, the companies are developing multi-domain mission infrastructure capabilities that are secure, resilient and capable of spanning air, land, sea and space.

Forward Guidance

Leidos is updating its fiscal year 2023 guidance as follows:

FY23 Guidance

Measure

Current

Prior

Revenues (billions)

$14.9 – $15.2

$14.7 – $15.1

Adjusted EBITDA Margin

10.1% – 10.5%

10.3% – 10.5%

Non-GAAP Diluted EPS

$6.40 – $6.80

$6.40 – $6.80

Cash Flows Provided by Operating Activities (millions)

at or above $700

at or above $700

For information regarding adjusted EBITDA margin and non-GAAP diluted EPS, see the related explanations and reconciliations to GAAP measures included elsewhere in this release.

Leidos does not provide a reconciliation of forward-looking adjusted EBITDA margins or non-GAAP diluted EPS to net income due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. Because certain deductions for non-GAAP exclusions used to calculate projected net income may vary significantly based on actual events, Leidos is not able to forecast on a GAAP basis with reasonable certainty all deductions needed in order to provide a GAAP calculation of projected net income at this time. The amounts of these deductions may be material and, therefore, could result in projected net income and diluted EPS being materially less than what may be implied by projected adjusted EBITDA margins and non-GAAP diluted EPS.

Conference Call Information

Leidos management will discuss operations and financial results in an earnings conference call beginning at 8:00 A.M. eastern time on August 1, 2023. Analysts and institutional investors may participate by dialing +1 (877) 869-3847 (toll-free U.S.) or +1 (201) 689-8261 (international callers).

A live audio broadcast of the conference call along with a supplemental presentation will be available to the public through links on the Leidos Investor Relations website (View Source).

After the call concludes, an audio replay can be accessed on the Leidos Investor Relations website or by dialing +1 (877) 660-6853 (toll-free U.S.) or +1 (201) 612-7415 (international callers) and entering conference ID 13739546.