On March 11, 2020 Dynavax Technologies Corporation (Nasdaq: DVAX), a biopharmaceutical company focused on developing and commercializing novel vaccines, reported financial results for the fourth quarter and full year 2019 (Press release, Dynavax Technologies, MAR 11, 2020, View Source [SID1234555416]).

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"Vaccines offer an unmatched value to the healthcare system and Dynavax continues to make tremendous progress on its transformation into a leading vaccine company. Our first product, HEPLISAV-B, provides adults higher and faster protection from hepatitis B in just two doses compared to previously available vaccines," commented Ryan Spencer, Chief Executive Officer of Dynavax. "We are excited by the response from our customers and our continued success in growing market share, which reinforces our belief that HEPLISAV-B has the potential to become the standard of care for adult hepatitis B vaccination in the U.S."

Mr. Spencer added, "Our focus in 2020 is driving annual revenue growth of HEPLISAV-B, generating data to support a unique dosing regimen for patients on hemodialysis, and supporting policy initiatives aimed at protecting more adults through adoption of a two-dose regimen, all of which position HEPLISAV-B for substantial long-term growth."

2019 Results and Recent Business Highlights

HEPLISAV-B [Hepatitis B Vaccine (Recombinant), Adjuvanted]

Full year 2019 net product revenue of $34.6 million compared to $6.8 million for 2018.
Market share in accounts targeted by the field sales team increased to 21% in the fourth quarter 2019 from 18% in the third quarter 2019.
The Company filed the cumulative analysis (comprising both required interim analyses) of its post-marketing study assessing the rates of occurrence of acute myocardial infarction in persons receiving HEPLISAV-B compared with Engerix-B with the U.S. Food and Drug Administration. The event rates were similar between the two treatment arms.
Announced partnership with Albertsons Companies’ 1,700 pharmacies nationwide, to provide HEPLISAV-B to people living with diabetes.
Corporate Updates

Established research collaboration with the University of Queensland and the Coalition for Epidemic Preparedness to develop a coronavirus (COVID-19) vaccine.
Appointed Ryan Spencer Chief Executive Officer and to the Board of Directors.
Appointed David Novack President and Chief Operating Officer.
2020 Milestones

HEPLISAV-B net product revenue expected to increase to $55-$62 million for the full year 2020
Release interim data from ongoing study of HEPLISAV-B in patients on hemodialysis in Q1 2020 and final immunogenicity data in the second half of 2020
Complete Phase 1-enabling animal studies and toxicology for improved pertussis vaccine with CpG 1018
Enter multiple strategic relationships focused on initial research in a variety of vaccine candidates to establish CpG 1018 as a leading adjuvant
Complete safety follow-up for HEPLISAV-B post-marketing studies in Q4 2020
Financial Results

Product Revenue, Net. HEPLISAV-B was launched in the first quarter of 2018. Net product revenue for the fourth quarter 2019 was $10.6 million, compared to $3.9 million for the fourth quarter 2018. Full year net product revenue for 2019 was $34.6 million compared to $6.8 million for the full year 2018. Product revenue from sales is recorded at the net sales price, which includes estimates of product returns, chargebacks, discounts and other fees.

Cost of Sales – Product. Cost of sales – product for the fourth quarter 2019 was $2.4 million, compared to $1.6 million for the fourth quarter 2018. Full year 2019 cost of sales – product was $10.2 million, compared to $10.9 million for the full year 2018.

R&D Expenses. Research and development (R&D) expenses for the fourth quarter of 2019 were $12.3 million, compared to $22.9 million for the fourth quarter of 2018. Full year 2019 R&D expenses were $62.3 million, compared to $75.0 million for the full year 2018. The decrease in R&D expenses is due to the winding down of oncology research and development activity resulting from the Company’s strategic organizational restructuring to focus on its vaccine business that was implemented in May 2019. R&D expenses in the fourth quarter of 2019 included approximately $3 million in external expenses related to oncology programs. These expenses are expected to continue to decrease over the next three quarters as activities are completed, with total additional external expenses over that period anticipated to be approximately $6 million.

SG&A Expenses. Selling, general and administrative (SG&A) expenses for the fourth quarter of 2019 were $20.3 million, compared to $16.4 million for the fourth quarter of 2018. Full year 2019 SG&A expenses were $75.0 million, compared to $64.8 million for the full year 2018. The increase for both the three and 12 months ended December 31, 2019 compared to 2018, was due primarily to increases in sales and marketing activities, payments for completion of certain milestones in the HEPLISAV-B post-marketing study and higher facility costs due to an increase in facility related overhead allocation to SG&A functions following the May restructuring and increased lease expense which is being recouped through a sublease to a third party and recorded as part of other income (expense).

Net Loss. Net loss allocable to common stockholders for the fourth quarter of 2019 was $36.8 million, or $0.44 per basic and diluted share, compared to a net loss of $40.0 million, or $0.64 per basic and diluted share, for the fourth quarter of 2018. Full year, net loss allocable to common stockholders, was $155.9 million, or $2.16 per basic and diluted share, compared to a net loss of $158.9 million, or $2.55 per basic and diluted share for the full year 2018.

Cash Position. Cash, cash equivalents and marketable securities totaled $151.1 million at December 31, 2019.

Conference Call and Webcast Information
Dynavax will hold a conference call today at 4:30 p.m. ET/1:30 p.m. PT. The live audio webcast may be accessed through the "Events & Presentations" page on the "Investors" section of the Company’s website at www.dynavax.com. Alternatively, participants may dial 800-458-4121 (domestic) or 720-543-0206 (international) and refer to conference ID 1989638. A replay of the webcast will be available for 30 days following the live event.

About Hepatitis B
Hepatitis B is a viral disease of the liver that can become chronic and lead to cirrhosis, liver cancer and death. The hepatitis B virus is 50 to 100 times more infectious than HIV,I and transmission is on the rise. There is no cure for hepatitis B, but effective vaccination can prevent the disease.

In adults, hepatitis B is spread through contact with infected blood and through unprotected sex with an infected person. The U.S. Centers for Disease Control (CDC) recommends vaccination for those at high risk for infection due to their jobs, lifestyle, living situations and travel to certain areas.II Because people with diabetes are particularly vulnerable to infection, the CDC recommends vaccination for adults age 19 to 59 with diabetes as soon as possible after their diagnosis, and for people age 60 and older with diabetes at their physician’s discretion.III Approximately 20 million U.S. adults have diabetes, and 1.5 million new cases of diabetes are diagnosed each year.IV

About HEPLISAV-B
HEPLISAV-B is an adult hepatitis B vaccine that combines hepatitis B surface antigen with Dynavax’s proprietary Toll-like Receptor (TLR) 9 agonist to enhance the immune response. Dynavax has worldwide commercial rights to HEPLISAV-B.