On May 5, 2020 Incyte (Nasdaq: INCY) reported 2020 first quarter financial results, and provides a status update on the Company’s development portfolio (Press release, Incyte, MAY 5, 2020, View Source [SID1234556999]).
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"Our strong first quarter results highlight continued revenue momentum, led by robust demand across all three indications for Jakafi (ruxolitinib)," stated Hervé Hoppenot, Chief Executive Officer, Incyte. "As we navigate this unprecedented and uncertain time, we have implemented numerous initiatives as we seek to ensure continuity of patient care. We are continuing to execute on our goals, and we were very pleased to announce the FDA approval of Pemazyre (pemigatinib), the first of three potential product approvals that we expect to announce in 2020. The FDA review of the capmatinib NDA and tafasitamab BLA are proceeding as expected and, following positive results from our Phase 3 TRuE-AD development program in atopic dermatitis, we are also on track to submit the NDA for ruxolitinib cream at the end of 2020, all of which positions us for what I expect to be a transformational year."
COVID-19
Commercial, Supply and Clinical & Regulatory Impact
While it is currently not possible to predict the overall long-term impact of the COVID-19 pandemic on Incyte’s business, to-date, there has been no impact on the commercial side of the business, and Incyte currently has ample commercial and clinical supply of our medicines to meet the needs of patients receiving Incyte’s approved medicines and those participating in global clinical trials. Incyte’s manufacturing processes are proceeding as usual, with increased manufacturing efforts for ruxolitinib in place to respond to the COVID-19 pandemic and study requests. Incyte continues to move forward with its global clinical trials, and late-stage programs remain broadly on track, although short-term effects may continue to emerge. For example, while ongoing monitoring of already-enrolled patients is expected to continue, new patient recruitment in certain clinical studies may be impacted. The impact on clinical trials may also vary by disease state and by severity of disease, as well as by geography, as some regions are more adversely impacted.
Ruxolitinib and baricitinib as potential therapies for patients with COVID-19
Incyte has initiated a Phase 3 clinical trial (RUXCOVID) to evaluate the efficacy and safety of ruxolitinib plus standard-of-care (SoC), compared to SoC therapy alone, in patients with COVID-19 associated cytokine storm. The collaborative study is sponsored by Incyte in the United States and by Novartis outside of the United States.
Incyte is also opening a second Phase 3 clinical trial in the United States to evaluate the efficacy and safety of ruxolitinib plus SoC, compared to SoC therapy alone, in COVID-19 patients on mechanical ventilation and who have acute respiratory distress syndrome (ARDS), a type of respiratory failure characterized by rapid onset of widespread inflammation in the lungs.
Additionally, Incyte has launched an emergency Expanded Access Program in the United States to allow eligible patients with COVID-19 associated cytokine storm to receive ruxolitinib.
In April, Lilly announced it has entered into an agreement with the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH), to study baricitinib as an arm in NIAID’s Adaptive COVID-19 Treatment Trial. The study will investigate the efficacy and safety of baricitinib as a potential treatment for hospitalized patients diagnosed with COVID-19 in the US, and Lilly is also planning a study expansion to include Europe and Asia.
Portfolio Update
LIMBER – key highlights
Key LIMBER development programs, including the once-a-day (QD) formulation of ruxolitinib, and the ongoing and planned ruxolitinib combinations with parsaclisib (PI3Kδ), PIM, BET and ALK2 are currently on track.
Indication and status
Once-a-day ruxolitinib
(JAK1/JAK2)
Myelofibrosis and polycythemia vera: clinical pharmacology studies
ruxolitinib + parsaclisib
(JAK1/JAK2 + PI3Kδ)
Refractory myelofibrosis: Phase 3 in preparation
ruxolitinib + INCB53914
(JAK1/JAK2 + PIM)
Refractory myelofibrosis: Phase 2
ruxolitinib + INCB57643
(JAK1/JAK2 + BET)
Refractory myelofibrosis: Phase 2 in preparation
ruxolitinib + INCB00928
(JAK1/JAK2 + ALK2)
Myelofibrosis: Phase 2 in preparation
Oncology beyond MPNs – key highlights
In April, the FDA approved Pemazyre, Incyte’s selective fibroblast growth factor receptor (FGFR) inhibitor, for the treatment of adults with previously treated, unresectable locally advanced or metastatic cholangiocarcinoma with an FGFR2 fusion or other rearrangement as detected by an FDA-approved test. Pemazyre was reviewed under Breakthrough Therapy designation and granted accelerated approval based on overall response rate and duration of response. The marketing authorization application (MAA) seeking approval for pemigatinib in Europe is under review by the European Medicines Agency (EMA).
Delays in data collection and validation, caused by COVID-19 related disruption, mean that data from the FIGHT-201 clinical trial of pemigatinib in patients with bladder cancer are now expected to be presented at a medical conference in early 2021; all other clinical trials of pemigatinib are currently progressing as expected.
Data from the Phase 3 REACH 2 trial of ruxolitinib versus best available therapy (BAT) in patients with steroid-refractory acute graft-versus-host disease (GVHD) have been published in The New England Journal of Medicineand are also expected to be presented at the 46th annual meeting of the European Society for Blood and Marrow Transplantation (EBMT) in August 30-September 2, 2020 (postponed from March 22-25, 2020). The Phase 3 REACH 3 trial of ruxolitinib versus BAT in patients with steroid-refractory chronic GVHD has completed recruitment and results are expected in the second half of 2020.
The collaboration and license agreement with MorphoSys for the development and commercialization of tafasitamab became effective in March. In February, the FDA granted Priority Review for tafasitamab in combination with lenalidomide for the treatment of relapsed or refractory diffuse large B-cell lymphoma (r/r DLBCL), and set a PDUFA goal date of August 30, 2020.
Preparations are ongoing to initiate the Phase 3 POD1UM-304 trial of retifanlimab (formerly INCMGA0012) in combination with platinum-based chemotherapy as a first-line treatment for patients with non-small cell lung cancer (NSCLC). Incyte no longer plans to pursue the Phase 3 POD1UM-301 trial of retifanlimab in combination with chemoradiation therapy (CRT) in participants with unresectable, Stage III NSCLC.
Indication and status
ruxolitinib
(JAK1/JAK2)
Steroid-refractory chronic GVHD: Phase 3 (REACH3)1
itacitinib
(JAK1)
Treatment-naïve chronic GVHD: Phase 3 (GRAVITAS-309)
pemigatinib
(FGFR1/2/3)
Cholangiocarcinoma: Phase 2 (FIGHT-202), Phase 3 (FIGHT-302); MAA under review
Bladder cancer: Phase 2 (FIGHT-201, FIGHT-205)
8p11 MPN: Phase 2 (FIGHT-203)
Tumor agnostic: Phase 2 (FIGHT-207)
tafasitamab
(CD19)2
r/r DLBCL: Phase 2 (L-MIND); Phase 3 (B-MIND); BLA under review
1L DLBCL: Phase 1b (First-MIND)
parsaclisib
(PI3Kδ)
Follicular lymphoma: Phase 2 (CITADEL-203)
Marginal zone lymphoma: Phase 2 (CITADEL-204)
Mantle cell lymphoma: Phase 2 (CITADEL-205)
retifanlimab
(PD-1)3
MSI-high endometrial cancer: Phase 2 (POD1UM-101)
Merkel cell carcinoma: Phase 2 (POD1UM-201)
Anal cancer: Phase 2 (POD1UM-202)
NSCLC: Phase 3 (POD1UM-304) in preparation
1) Clinical development of ruxolitinib in GVHD conducted in collaboration with Novartis
2) Development of tafasitamab in collaboration with MorphoSys
3) Retifanlimab licensed from MacroGenics
Inflammation and Autoimmunity (IAI) – key highlights
In April, safety and efficacy data from the two Phase 3 trials in the TRuE-AD program evaluating ruxolitinib cream in mild-to-moderate atopic dermatitis were presented at the Revolutionizing Atopic Dermatitis (RAD) virtual symposium. The 44-week long-term safety and efficacy portion of both the TRuE-AD1 and TRuE-AD2 trials are ongoing and the NDA submission is expected before the end of 2020.
The two Phase 3 trials in the TRuE-V pivotal program evaluating ruxolitinib cream in patients with vitiligo are currently proceeding as planned, and results are expected in 2021.
Indication and status
ruxolitinib cream
(JAK1/JAK2)
Atopic dermatitis: Phase 3 (TRuE-AD1, TRuE-AD2; primary endpoints met)
Vitiligo: Phase 3 (TRuE-V1, TRuE-V2)
INCB54707
(JAK1)
Hidradenitis suppurativa: Phase 2
parsaclisib
(PI3Kδ)
Autoimmune hemolytic anemia: Phase 2
INCB00928
(ALK2)
Fibrodysplasia ossificans progressiva: Phase 2 in preparation
Discovery and early development – key highlights
Based on emerging data from the FGFR4 inhibitor program, development of INCB62079 has been discontinued because of insufficient efficacy in the target patient population. Incyte’s portfolio of other earlier-stage clinical candidates is summarized below.
Modality
Candidates
Small molecules
INCB01158 (ARG)1, INCB81776 (AXL/MER), epacadostat (IDO1), INCB59872 (LSD1), INCB86550 (PD-L1)
Monoclonal antibodies2
INCAGN1876 (GITR), INCAGN2385 (LAG-3), INCAGN1949 (OX40), INCAGN2390 (TIM-3)
Bispecific antibodies
MCLA-145 (PD-L1xCD137)3
1) INCB01158 development in collaboration with Calithera
2) Discovery collaboration with Agenus
3) MCLA-145 development in collaboration with Merus
Partnered – key highlights
In March, Incyte and Lilly announced the FDA has granted Breakthrough Therapy designation for baricitinib for the treatment of alopecia areata, an autoimmune disorder that can cause unpredictable hair loss on the scalp, face and other areas of the body. In January, Lilly submitted baricitinib for regulatory review in Europe and Japan as a treatment for patients with moderate-to-severe atopic dermatitis, and has announced plans to submit for approval in the U.S. in 2020.
In February, Incyte and Novartis announced that the NDA for capmatinib, seeking approval in patients with metastatic non-small cell lung cancer (NSCLC) and with a mutation leading to exon 14 skipping as detected by an FDA-approved test, was accepted for Priority Review by the FDA.
Indication and status
baricitinib (JAK1/JAK2)1
Atopic dermatitis: Phase 3 (BREEZE-AD)
Systemic lupus erythematosus: Phase 3
Severe alopecia areata: Phase 3 (BRAVE-AA1)
capmatinib (MET)2
NSCLC (with MET exon 14 skipping mutations): NDA (by Novartis) under review
1) Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate-to-severe rheumatoid arthritis
2) Worldwide rights to capmatinib licensed to Novartis
2020 First Quarter Financial Results
The financial measures presented in this press release for the three months ended March 31, 2020 and 2019 have been prepared by the Company in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), unless otherwise identified as a Non-GAAP financial measure. Management believes that Non-GAAP information is useful for investors, when considered in conjunction with Incyte’s GAAP disclosures. Management uses such information internally and externally for establishing budgets, operating goals and financial planning purposes. These metrics are also used to manage the Company’s business and monitor performance. The Company adjusts, where appropriate, for expenses in order to reflect the Company’s core operations. The Company believes these adjustments are useful to investors by providing an enhanced understanding of the financial performance of the Company’s core operations. The metrics have been adopted to align the Company with disclosures provided by industry peers.
Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used in conjunction with and to supplement Incyte’s operating results as reported under GAAP. Non-GAAP measures may be defined and calculated differently by other companies in our industry.
Financial Highlights
Product and Royalty Revenues Product and royalty revenues for the quarter ended March 31, 2020 increased 24% over the prior year comparative period as a result of increases in Jakafi and Iclusig net product revenues and higher product royalty revenues from Jakavi and Olumiant. Jakafi net product revenues for the quarter ended March 31, 2020 increased 22% over the prior year comparative period, primarily driven by growth in patient demand across all indications.
Operating Expenses
1. Non-GAAP cost of product revenues excludes the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the cost of stock-based compensation.
2. Non-GAAP research and development expenses exclude the cost of stock-based compensation.
3. Non-GAAP selling, general and administrative expenses exclude the cost of stock-based compensation.
4. Non-GAAP change in fair value of acquisition-related contingent consideration is null.
Research and development expenses GAAP and Non-GAAP research and development expense for the quarter ended March 31, 2020 increased 301% and 335%, respectively, compared to the same period in 2019, primarily due to upfront consideration of $805 million related to our collaborative agreement with MorphoSys.
Selling, general and administrative expenses GAAP and Non-GAAP selling, general and administrative expenses for the quarter ended March 31, 2020 decreased 10% and 12%, respectively, compared to the same period in 2019, primarily due to the timing of certain expenses.
Other Financial Information
Operating income (loss) GAAP and Non-GAAP operating income (loss) for the quarter ended March 31, 2020 decreased compared to the same period in 2019 primarily due to upfront consideration related to our collaborative agreement with MorphoSys, partially offset by the growth in product and royalty revenues.
Cash, cash equivalents and marketable securities position As of March 31, 2020 and December 31, 2019, cash, cash equivalents and marketable securities totaled $1.3 billion and $2.1 billion, respectively. The decrease reflects the upfront payment and stock purchase related to our collaborative agreement with MorphoSys.
2020 Financial Guidance
The Company has reaffirmed its full year 2020 financial guidance, as detailed below. The R&D expense guidance now includes the expenses related to Incyte’s share of tafasitamab development costs under the MorphoSys collaboration, but excludes $805 million of upfront consideration paid under the MorphoSys collaboration. The financial guidance also excludes the impact of any potential future strategic transactions.
Unchanged
1. Adjusted to exclude the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the estimated cost of stock-based compensation.
2. Adjusted to exclude the estimated cost of stock-based compensation.
3. Adjusted to exclude the change in fair value of estimated future royalties relating to sales of Iclusig in the licensed territory relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc.
Future Non-GAAP financial measures may also exclude impairment of goodwill or other assets, changes in the fair value of equity investments in our collaboration partners, non-cash interest expense related to the amortization of the initial discount on our 2020 Senior Notes and the impact on our tax provision of discrete changes in our valuation allowance position on deferred tax assets.
Conference Call and Webcast Information
Incyte will hold a conference call and webcast this morning at 8:00 a.m. EDT. To access the conference call, please dial 877-407-3042 for domestic callers or 201-389-0864 for international callers. When prompted, provide the conference identification number, 13702083.
If you are unable to participate, a replay of the conference call will be available for 30 days. The replay dial-in number for the United States is 877-660-6853 and the dial-in number for international callers is 201-612-7415. To access the replay you will need the conference identification number, 13702083.
The conference call will also be webcast live and can be accessed at investor.incyte.com.
About Incyte
Incyte is a Wilmington, Delaware-based, global biopharmaceutical company focused on finding solutions for serious unmet medical needs through the discovery, development and commercialization of proprietary therapeutics.
For additional information on Incyte, please visit Incyte.com and follow @Incyte.
About Jakafi (ruxolitinib)
Jakafi is a first-in-class JAK1/JAK2 inhibitor approved by the U.S. FDA for treatment of steroid-refractory acute GVHD in adult and pediatric patients 12 years and older.
Jakafi is also indicated for treatment of polycythemia vera (PV) in adults who have had an inadequate response to or are intolerant of hydroxyurea as well as adults with intermediate or high-risk myelofibrosis (MF), including primary MF, post-polycythemia vera MF and post-essential thrombocythemia MF.
Jakafi is marketed by Incyte in the United States and by Novartis as Jakavi (ruxolitinib) outside the United States. Jakafi is a registered trademark of Incyte Corporation. Jakavi is a registered trademark of Novartis AG in countries outside the United States.
About Pemazyre (pemigatinib)
Pemazyre is a kinase inhibitor indicated for the treatment of adults with previously treated, unresectable locally advanced or metastatic cholangiocarcinoma with a fibroblast growth factor receptor 2 (FGFR2) fusion or other rearrangement as detected by an FDA-approved test.
Pemazyre is a potent, selective, oral inhibitor of FGFR isoforms 1, 2 and 3 which, in preclinical studies, has demonstrated selective pharmacologic activity against cancer cells with FGFR alterations.
Pemazyre is marketed by Incyte in the United States. Incyte has granted Innovent Biologics, Inc. rights to develop and commercialize pemigatinib in hematology and oncology in Mainland China, Hong Kong, Macau and Taiwan. Incyte has retained all other rights to develop and commercialize pemigatinib outside of the United States.
Additionally, Incyte’s marketing authorization application (MAA) seeking the approval of pemigatinib for patients with cholangiocarcinoma in the EU has been validated by the European Medicines Agency (EMA) and is currently under review for the treatment of adults with locally advanced or metastatic cholangiocarcinoma with a fibroblast growth factor receptor 2 (FGFR2) fusion or rearrangement that is relapsed or refractory after at least one line of systemic therapy.
Pemazyre is a trademark of Incyte Corporation.
About Iclusig (ponatinib) tablets
Iclusig targets not only native BCR-ABL but also its isoforms that carry mutations that confer resistance to treatment, including the T315I mutation, which has been associated with resistance to other approved TKIs.
In the EU, Iclusig is approved for the treatment of adult patients with chronic phase, accelerated phase or blast phase chronic myeloid leukemia (CML) who are resistant to dasatinib or nilotinib; who are intolerant to dasatinib or nilotinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation, or the treatment of adult patients with Philadelphia-chromosome positive acute lymphoblastic leukemia (Ph+ ALL) who are resistant to dasatinib; who are intolerant to dasatinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation.
Incyte has an exclusive license from ARIAD Pharmaceuticals, Inc., since acquired by Takeda Pharmaceutical Company Limited, to develop and commercialize Iclusig in the European Union and 22 other countries, including Switzerland, Norway, Turkey, Israel and Russia.