On May 6, 2021 Coherus BioSciences, Inc. ("Coherus" or the "Company", Nasdaq: CHRS), reported financial results for the quarter ended March 31, 2021 (Press release, Coherus Biosciences, MAY 6, 2021, View Source [SID1234579335]). The Company also provided a progress update on its anti-PD-1 antibody, toripalimab, its lead immuno-oncology candidate for the potential treatment of various solid tumors, as well as other late-stage pipeline product candidates including CHS-201, a biosimilar Lucentis (ranibizumab), CHS-1420, a wholly owned biosimilar Humira (adalimumab), and CHS-305, a biosimilar Avastin (bevacizumab).
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"Over the next two years, we project four additional Coherus product candidates will be approved in the United States, including three biosimilars and our anti-PD-1 antibody, toripalimab," said Denny Lanfear, CEO of Coherus. "We believe this diversified product portfolio has the potential to generate significant revenue growth and fuel our investments in novel immuno-oncology therapies with the potential to improve care and outcomes for cancer patients."
"With significant new clinical data and the first U.S. BLA submission underway, toripalimab is already exceeding our expectations," Lanfear continued. "During a rigorous multi-year evaluation of the global checkpoint inhibitor landscape, we defined the preclinical and clinical properties required for our investment in a PD-1 blocking antibody. Toripalimab’s demonstrated potency, unique molecular properties and advanced pivotal clinical development program in numerous cancer types surpassed our stringent criteria. It is gratifying to see the accumulating external validation for toripalimab including selection for ASCO (Free ASCO Whitepaper)’s plenary session, Breakthrough Therapy Designation from the FDA for nasopharyngeal carcinoma, and the additional recent approvals in China. We believe these developments and the external interest we have already received to evaluate potential toripalimab combinations positions this product candidate as a significant potential growth driver for Coherus for many years."
FIRST QUARTER 2021 FINANCIAL HIGHLIGHTS
GAAP net loss of $173 million for the first quarter of 2021 was primarily driven by the $145 million upfront payment to Junshi Biosciences for U.S. and Canada rights to the anti-PD-1 antibody toripalimab and one-time charges associated with the termination of the CHS-2020 biosimilar program as part of the strategic realignment of research and development resources toward immuno-oncology.
Non-GAAP net income for the first quarter of 2021 was $0.4 million, or $0.01 per share.
Cash flow from operations was $1.4 million.
Net product revenue, consisting of net sales of UDENYCA (pegfilgrastim-cbqv) was $83 million for the first quarter of 2021. With approximately 20% share of the overall pegfilgrastim market, UDENYCA maintains its position as the leading pegfilgrastim biosimilar.
Coherus had cash, cash equivalents and marketable securities of $400 million at March 31, 2021.
In April 2021, the Company received $50 million from Junshi Biosciences’ acquisition of 2,491,988 shares of Coherus stock at a price per share of $20.06.
PIPELINE HIGHLIGHTS
Toripalimab, a PD-1 blocking antibody product candidate, in collaboration with Junshi Biosciences:
Junshi Biosciences initiated the rolling submission of the biologics license application ("BLA") with the U.S. Food and Drug Administration ("FDA") for toripalimab for the treatment of recurrent or metastatic nasopharyngeal carcinoma ("NPC"). The FDA has granted toripalimab Breakthrough Therapy Designation for this indication. The BLA submission is expected to be completed mid-year 2021, with potential approval in the first half of 2022.
Results of JUPITER-02, a randomized, double-blind, placebo-controlled, multi-center, Phase 3 clinical trial evaluating toripalimab for first-line NPC, will be featured in the plenary session and in the official press program of the 2021 ASCO (Free ASCO Whitepaper) Annual Meeting in early June.
In JUPITER-06, a randomized, double-blind, placebo-controlled, multi-center, Phase 3 clinical trial with 514 patients enrolled, toripalimab in combination with paclitaxel/cisplatin as first-line treatment for patients with advanced esophageal squamous cell carcinoma ("ESCC") achieved the pre-specified primary endpoints of progression free survival ("PFS") and overall survival ("OS") at the interim analysis. Data from the study are expected later in 2021.
Coherus and Junshi Biosciences plan to file additional toripalimab BLA supplements with the FDA over the next three years for multiple rare and highly prevalent tumor types, including non-small cell lung cancer ("NSCLC"). An ongoing Phase 3 clinical study of toripalimab in combination with standard chemotherapy as the first-line treatment of patients with advanced NSCLC reached its primary endpoint of PFS at the interim analysis in December 2020. Top-line results are expected later in 2021.
CHS-201, a biosimilar Lucentis (ranibizumab) product candidate in collaboration with Bioeq AG:
Bioeq AG expects to file the CHS-201 BLA mid-year 2021, following a supportive pre-BLA meeting with the FDA earlier in the first quarter of 2021. Bioeq reviewed new manufacturing data with the FDA, which the agency requested last year, as well as other elements of the BLA filing.
CHS-1420, a wholly owned biosimilar Humira (adalimumab) product candidate:
The FDA accepted for review the BLA for CHS-1420 and assigned a target action date in December 2021. The FDA has completed the on-site portion of the pre-approval drug substance CMC inspection, with no Form 483s being issued. Coherus plans to launch CHS-1420 on or after July 1, 2023, if approved.
CHS-305, a biosimilar Avastin (bevacizumab) product candidate in collaboration with Innovent Biologics (Suzhou) Co. Ltd:
Coherus initiated the three-way pharmacokinetic study to facilitate the potential BLA submission. Recruitment into the study has been slower than expected as a result of the COVID-19 pandemic, and Coherus now expects data from this study around year end 2021.
Coherus is planning an analyst day event in the fourth quarter of 2021.
FIRST QUARTER 2021 FINANCIAL RESULTS
Net product revenue, consisting of net sales of UDENYCA, was $83 million for the first quarter of 2021. Net Product revenue declined in comparison to the prior quarter and the first quarter of 2020 due to an increase in discounts and allowances, as well as a reduction in ex-factory units sold due to seasonal fluctuations in wholesale inventory levels in the fourth quarter of 2020 and the first quarter of 2021.
Research and development (R&D) expenses for the first quarter of 2021 were $203.5 million, compared to $33.1 million for the same period in 2020. The increase was mainly due to the $145 million upfront payment to Junshi Biosciences upon the closing of the collaboration agreement in March, the $11.5 million charge related to the termination of the CHS-2020 program, and higher development costs in support of the advancement of toripalimab and the biosimilar pipeline product candidates.
Selling, general and administrative (SG&A) expenses were $39.4 million in the first quarter of 2021 as compared to $35.4 million in the year ago quarter. The increase was primarily driven by an increase in stock based compensation expense.
Net loss for the first quarter of 2021 was $172.9 million, or $2.37 per share on a diluted basis, compared to a net income of $35.6 million, or $0.48 per share on a diluted basis for the same period in 2020.
Non-GAAP net income for the first quarter of 2021 was $0.4 million, or $0.01 per share on a diluted basis, compared to non-GAAP net income of $49.8 million, or $0.67 per share on a diluted basis for the same period in 2020. See "Non-GAAP Financial Measures" below for a discussion on how Coherus calculates non-GAAP net income and a reconciliation to the most directly comparable GAAP measures.
Cash, cash equivalents and investments in marketable securities were $399.5 million as of March 31, 2021, compared to $541.2 million at year end 2020. Subsequent to quarter end, Coherus received $50 million from Junshi Biosciences’ acquisition of 2,491,988 shares at a price per share of $20.06.
2021 FINANCIAL OUTLOOK
Coherus expects UDENYCA revenue and market penetration to rise in the second half of 2021, assuming the COVID-19 pandemic recedes and treatment patterns normalize, and subject to pricing trends in the overall pegfilgrastim market.
Excluding the $145 million upfront payment made to Junshi Biosciences in the first quarter, Coherus projects full year R&D and SG&A expenses in a range of $370 million to $400 million. External R&D spending is focused on manufacturing-related activities in preparation for the potential launch of toripalimab and CHS-1420, if approved, and development activities for CHS-305 and for additional presentations of UDENYCA. Increases in SG&A spending in 2021 are primarily driven by marketing activities and headcount to support UDENYCA and the potential launches in 2022 of toripalimab and CHS-201 (Lucentis biosimilar).
This financial guidance excludes the effects of any potential future strategic acquisitions, collaborations or investments, the exercise of rights or options related to collaboration programs, and any other transactions or items not yet identified or quantified. This guidance is subject to a number of risks and uncertainties. See Forward-Looking Statements described in the section below and the section titled "Risk Factors" in the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 to be filed with the Securities & Exchange Commission on May 6, 2021.
Conference Call Information
When: Thursday, May 6, 2021 starting at 4:30 p.m. ET
Dial-in: (800) 446-2782 (Toll-Free U.S. and Canada) or (847) 413-3235 (International)
Conference ID: 50149707
Webcast: View Source
Please join the conference call at least 10 minutes early to register. The webcast will be archived on the Coherus website.