On March 26, 2024 bluebird bio, Inc. (NASDAQ: BLUE) ("bluebird bio" or the "Company") reported fourth quarter and annual financial results and business highlights for the year ended December 31, 2023, including recent commercial and operational progress (Press release, bluebird bio, MAR 26, 2024, View Source [SID1234641439]).
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"In 2023, bluebird established a validated, commercial gene therapy strategy that brought ZYNTEGLO and SKYSONA to individuals living with beta-thalassemia and cerebral adrenoleukodystrophy. Building on that foundation, today we are positioned for robust commercial uptake of LYFGENIA for sickle cell disease, with a substantial QTC network in place, favorable Medicaid coverage being established, and demonstrated strong patient demand," said Andrew Obenshain, chief executive officer, bluebird bio. "Our recent agreement with Hercules Capital meaningfully extends our cash runway, and further enables us to capitalize on our commercial head start and bring our transformative gene therapies to patients and their families. In 2024, we anticipate between 85 to 105 patient starts across our three FDA approved therapies, laying the foundation for strong revenue growth."
RECENT COMPANY HIGHLIGHTS
Up to $175 million Debt Financing with Hercules Capital
On March 18, 2024, bluebird announced that it had entered into a five-year term loan facility with Hercules Capital. Under the terms of the agreement, the Company may draw up to $175 million, available in four tranches. The first tranche of $75 million was drawn at closing. The Company may draw upon two additional tranches of $25 million each, subject to satisfaction of certain conditions, including achievement of commercial milestones. The facility also provides for a fourth tranche of $50 million, available at the lender’s discretion.
Based on launch estimates and current business plans, and assuming three tranches totaling $125 million are executed, the transaction is projected to extend the Company’s cash runway through Q1 2026.
COMMERCIAL LAUNCH UPDATES
Strong patient uptake across portfolio
First LYFGENIA patient start imminent; multiple patients enrolled and preparing for treatment across QTC network.
Continued strong, linear growth for ZYNTEGLO with 7 patient starts since the beginning of 2024, in addition to 20 patient starts completed for ZYNTEGLO in 2023.
Completed 2 patient starts for SKYSONA since the beginning of 2024, in addition to 6 patient starts completed for SKYSONA in 2023.
Validated access and reimbursement strategy is driving favorable coverage landscape
In the first quarter of 2024, bluebird signed its first Medicaid outcomes-based agreement for LYFGENIA with the state of Michigan.
In addition to the Medicaid outcomes-based agreement, bluebird has signed four outcomes-based agreements for LYFGENIA with national commercial payer organizations and published coverage policies cover more than 200 million U.S. lives.
Discussions are ongoing with more than 15 Medicaid agencies representing 80% of Medicaid-insured individuals with sickle cell disease in the U.S. and the Company is engaged with the Center for Medicare and Medicaid Innovation (CMMI) on its Cell and Gene Therapy Access Model demonstration.
Timely access to ZYNTEGLO and SKYSONA has continued, with zero ultimate denials for either therapy across both Medicaid and commercial payers.
Substantial QTC footprint established
bluebird has activated 62 QTCs for ZYNTEGLO (defined as a signed MSA); capitalizing on launch synergies, 49 centers are already receiving referrals for LYFGENIA.
Five centers are also activated to administer SKYSONA for patients with cerebral adrenoleukodystrophy (CALD).
The Company anticipates continued QTC network expansion across its portfolio in 2024.
LOVO-CEL CLINICAL TRIAL UPDATE
Enrollment is ongoing for the HGB-210 study evaluating lovo-cel for patients under the age of 12. The Company anticipates enrollment to be complete in Q4 2024.
2024 GUIDANCE
The Company anticipates 85 to 105 patient starts (cell collections) combined across all three of its FDA approved therapies (LYFGENIA, ZYNTEGLO, SKYSONA) in 2024. Consistent with previous quarters, bluebird plans to provide quarterly updates on patient starts for each of its therapies.
Gross-to-net discounts across all three products are expected to be in the range of 20% to 25% of gross revenue in 2024 and will fluctuate based on product and payer mix, and well as utilization of outcomes-based agreements for LYFGENIA and ZYNTEGLO.
Based on projected timelines from cell collection to infusion, the Company expects to recognize revenue from its first infusion of LYFGENIA in the third quarter of 2024.
FOURTH QUARTER AND ANNUAL FINANCIAL HIGHLIGHTS
Cash Position: The Company’s cash, cash equivalents and restricted cash balance was approximately $275 million, including restricted cash of approximately $53 million, as of December 31, 2023.
Based on launch trajectory and current business plans, bluebird expects its cash and cash equivalents excluding restricted cash and assuming three tranches totaling $125 million in proceeds from its term loan facility are executed, will be sufficient to meet bluebird’s planned operating expenses and capital expenditure requirements through Q1 2026.
In the fourth quarter of 2023, the Company entered into a factoring agreement which is accelerating cash collection related to patient starts across its portfolio of approved therapies.
Revenue, net: Total revenue, net was $7.8 million for the three months ended December 31, 2023, compared to $0.1 million for the three months ended December 31, 2022.
Total revenue, net was $29.5 million for the twelve months ended December 31, 2023, compared to $3.6 million for the twelve months ended December 31, 2022. The increase of $25.9 million was primarily due to SKYSONA and ZYNTEGLO product revenue.
For the year ended December 31, 2023, product revenues by therapy represent $16.7 million attributable to ZYNTEGLO and $12.4 million attributable to SKYSONA, with gross-to-net discounts of approximately 19% across both products.
On March 26, 2024, bluebird announced that it will restate its consolidated financial statements for 2022, and for the first three quarters of both 2022 and 2023 in its Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Form 10-K"). The restatements relate to the identification of embedded leases and the treatment of non-lease components contained in lease agreements with contract manufacturers. As a result, the Company anticipates recording an increase in lease assets and lease liabilities, as well as an increase in non-cash interest expense in each restated period. The Company does not expect the restatement to result in any impact on its cash position or revenue. bluebird anticipates filing its 2023 Form 10-K, inclusive of the restatement no later than April 16, 2024.
The financial results included in this press release represent the most current information available to the Company’s management. The Company expects that its actual results to be reported in its 2023 Form 10-K will not differ materially from the results included herein, however, these results are subject to change following the completion of the Company’s financial close procedures and the audit of its consolidated financial statements for the year ended December 31, 2023.
CONFERENCE CALL DETAILS
bluebird will hold a conference call to discuss its fourth quarter and 2023 annual results and business updates today, Tuesday, March 26, 2024, at 8:00 am ET.
To access the live conference call via telephone, please register at this link to receive a dial in number and unique PIN.
The live webcast of the call may be accessed by visiting the "Events & Presentations" page within the Investors & Media section of the bluebird website at View Source A replay of the webcast will be available on the bluebird website for 90 days following the event.