On August 4, 2022 Coherus BioSciences, Inc. (Coherus or the Company, Nasdaq: CHRS), reported financial results for the quarter ended June 30, 2022 and recent business highlights (Press release, Coherus Biosciences, AUG 4, 2022, View Sourcenews-releases/news-release-details/coherus-biosciences-reports-second-quarter-2022-results-and" target="_blank" title="View Sourcenews-releases/news-release-details/coherus-biosciences-reports-second-quarter-2022-results-and" rel="nofollow">View Source [SID1234617530]):

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RECENT BUSINESS HIGHLIGHTS

The U.S. Food and Drug Administration (FDA) has approved CIMERLI (ranibizumab-eqrn) as a biosimilar product interchangeable with Lucentis (ranibizumab injection) for all five indications, with 12 months of interchangeability exclusivity. Commercial launch of CIMERLI, in both 0.3 mg and 0.5 mg dosage forms, is planned for early October 2022.
The FDA accepted for review the Biologics License Application (BLA) resubmission for toripalimab in combination with gemcitabine and cisplatin as first-line treatment for patients with advanced recurrent or metastatic nasopharyngeal carcinoma (NPC) and for toripalimab monotherapy for the second-line or later treatment of recurrent or metastatic NPC after platinum-containing chemotherapy. The FDA set a target action date of December 23, 2022 for the toripalimab BLA.
"Coherus is entering a period of rapid product portfolio expansion as well as revenue growth and diversification, due to the outstanding execution by our team on plans we initiated in 2019. With the approval of CIMERLI, we now have three FDA-approved products – UDENCYA, CIMERLI, and YUSIMRY, with a fourth product candidate, toripalimab, our PD-1 inhibitor, in the final stages of FDA review. We are preparing to launch four new products in 2022 and 2023, leveraging the scale of our commercial organization to generate sales which will return the company to revenue growth and profitability," said Denny Lanfear, Coherus’ CEO. "With $275 million in cash and cash equivalents, access to additional capital through existing agreements, and significant projected revenue growth, we believe we have the financial resources to launch and support these new products, while judiciously continuing to invest in the oncology pipeline and opportunities."

SECOND QUARTER 2022 FINANCIAL RESULTS

Net revenue, consisting primarily of net sales of UDENYCA, was $60.2 million and $87.6 million during the three months ended June 30, 2022 and 2021, respectively, and $120.3 million and $170.7 million during the six months ended June 30, 2022 and 2021, respectively. The decline was primarily due to a decrease in the number of units of UDENYCA sold as well as a lower net realized price due to increased competition.

Cost of goods sold (COGS) was $11.3 million and $16.7 million during the three months ended June 30, 2022 and 2021, respectively, and $20.6 million and $24.2 million during the six months ended June 30, 2022 and 2021, respectively, reflecting decreases in the number of units of UDENYCA sold. Through the first quarter of 2021, Coherus sold inventory that was manufactured and expensed prior to the approval of UDENYCA in late 2018. This inventory was depleted in the first quarter of 2021, and since then, COGS fully reflects per unit acquisition cost. UDENYCA COGS also includes a mid-single digit royalty on net sales payable through the first half of 2024.

Research and development (R&D) expense for the three months ended June 30, 2022 and 2021 was $41.6 million and $54.8 million, respectively. The decrease was driven by lower development costs as several clinical studies were completed in 2021, partially offset by higher compensation expense. For the six months ended June 30, 2022 and 2021, R&D expense was $124.5 million and $258.3 million, respectively. The decrease was primarily due to the $136.0 million upfront license fee paid to Junshi Biosciences in 2021 offset by the $35.0 million option exercise fee for CHS-006 in the first quarter of 2022.

Selling, general and administrative (SG&A) expense was $51.3 million and $40.3 million during the three months ended June 30, 2022 and 2021, respectively, and $100.0 million and $79.7 million during the six months ended June 30, 2022 and 2021, respectively. The increases were primarily driven by higher commercialization expenses to support current UDENYCA sales and in preparation for multiple anticipated new product launches in 2022 and 2023, including CIMERLI, toripalimab, YUSIMRY, and the on-body injector presentation of UDENYCA.

Net loss for the second quarter of 2022 was $50.2 million, or $(0.65) per share on a diluted basis, compared to a net loss of $29.9 million, or $(0.40) per share on a diluted basis for the same period in 2021. Net loss for the first half of 2022 was $146.2 million, or $(1.89) per share on a diluted basis, compared to a net loss of $202.8 million, or $(2.73) per share on a diluted basis for the first half of 2021.

Non-GAAP net loss for the second quarter of 2022 was $36.3 million, or $(0.47) per share on a diluted basis, compared to non-GAAP net loss of $18.3 million, or $(0.24) per share on a diluted basis for the same period in 2021. Non-GAAP net loss for the first half of 2022 was $113.3 million, or $(1.46) per share on a diluted basis, compared to non-GAAP net loss of $162.9 million, or $(2.19) per share on a diluted basis for the first half of 2021. Beginning in the first quarter of 2022, the Company no longer regularly excludes upfront and milestone-based license fee payments from its non-GAAP financial information. To conform to this change, the prior period non-GAAP financial information has been recast to include upfront and milestone-based license fee payments. See "Non-GAAP Financial Measures" below for a discussion on how Coherus calculates non-GAAP net loss and a reconciliation to the most directly comparable GAAP measures.

Cash, cash equivalents and investments in marketable securities were $275.5 million as of June 30, 2022, compared to $417.2 million at December 31, 2021.

2022 R&D and SG&A Expense Guidance

Coherus is reducing the guidance range of combined 2022 R&D and SG&A expenses from $395 million to $430 million to a revised range of $375 million to $395 million. The revised guidance range reflects a reduction in R&D expenses associated with YUSIMRY manufacturing scale up and autoinjector production which will now be capitalized into inventory in accordance with relevant accounting rules. This guidance includes $55 million to $60 million of stock-based compensation expense and excludes the $35 million license fee paid in the first quarter of 2022 for CHS-006 as well as a potential $25 million milestone payable upon FDA approval of the toripalimab BLA for nasopharyngeal carcinoma. This financial guidance also 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 circumstances 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.

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Second quarter 2022 financial results are posted on the Coherus website at View Source