Post by gutset on May 7, 2024 20:05:44 GMT
MIAMI, May 07, 2024 (GLOBE NEWSWIRE) -- OPKO Health, Inc. (NASDAQ: OPK) reports business highlights and financial results for the three months ended March 31, 2024.
First quarter business highlights include the following:
Entered into an agreement with Labcorp to sell select assets of BioReference Health. The transaction includes the sale of BioReference Health’s laboratory testing businesses focused on clinical diagnostics and women’s health, excluding operations in New York and New Jersey, for $237.5 million. These assets comprise patient service centers, certain customer contracts and operating assets, which account for approximately $100 million in annualized revenue. BioReference Health will continue to offer oncology and urology diagnostic services nationwide, as well as maintain its full operations in New York and New Jersey. This transaction is expected to streamline BioReference Health’s laboratory services business while retaining its core operations to better position the division for sustained growth and profitability. The transaction is subject to customary closing conditions and applicable regulatory approvals, including under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The transaction is anticipated to close in the second half of 2024.
The IND application for MDX2001, a tetraspecific antibody for the treatment of solid tumor cancers, received FDA clearance. MDX2001 is designed to optimize T-cell function while preventing tumor antigen escape. The first patient is expected to be enrolled in a Phase 1 trial to evaluate safety, tolerability, pharmacokinetics and anti-tumor activity in the second quarter of 2024.
The global launch of NGENLA® is ongoing by OPKO’s partner, Pfizer. NGENLA is approved in over 50 countries including the U.S., Japan, EU Member States, Canada and Australia. OPKO is entitled to gross profit sharing based on sales of both NGENLA and Pfizer’s daily growth hormone product, Genotropin. In addition, OPKO is entitled to an additional $100 million in potential milestone payments associated with approvals for an adult indication for growth hormone deficiency and additional pediatric indications.
First Quarter Financial Results
Pharmaceuticals: Revenue from products in the first quarter of 2024 were $38.1 million compared to $40.4 million in the first quarter of 2023, resulting from lower sales in OPKO’s international operating companies and foreign currency exchange fluctuations, partially offset by an increase in sales of Rayaldee to $6.9 million from $6.6 million. Revenue from the transfer of intellectual property and other was $8.7 million in the first quarter of 2024 compared with $64.8 million in the 2023 period, which included $5.6 million in gross profit share and royalty payments for NGENLA and Pfizer's Genotropin® in the 2024 quarter compared with $3.1 million in the same period for 2023. The decrease in revenue from the transfer of intellectual property and other is primarily attributable to one-time milestone payments received in 2023 including a $50.0 million upfront payment from Merck, a $7.0 million milestone payment from Vifor Fresenius Medical Care Renal Pharma triggered by the German price approval for Rayaldee and a $2.5 million milestone payment from Nicoya Therapeutics for the submission of its IND application for Rayaldee to China's Center for Drug Evaluation. Total costs and expenses declined to $74.5 million in the first quarter of 2024 from $86.3 million in the prior-year period primarily due to a $10.6 million, or 33%, decrease in research and development expense as the 2023 period included a non-recurring payment to Sanofi related to our Merck collaboration, partially offset by increased activity within our ModeX development programs. Operating loss was $27.7 million in the first quarter of 2024 compared with operating income of $19.0 million in the first quarter of 2023, again with 2023 benefiting from over $59 million in milestones as described above.
Diagnostics: Revenue from services in the first quarter of 2024 was $126.9 million compared with $132.4 million in the prior-year period, with the decline primarily due to lower clinical testing volume. Total costs and expenses were $161.3 million in the first quarter of 2024 compared with $172.4 million in the first quarter of 2023, reflecting the continued implementation of cost-reduction initiatives. Included in first quarter 2024 results were revenue from services of approximately $27.8 million and total costs and expenses of approximately $34.8 million related to assets being acquired by Labcorp. Operating loss was $34.4 million in the first quarter of 2024 compared with $40.0 million in the 2023 period.
Consolidated: Consolidated total revenues for the first quarter of 2024 were $173.7 million compared with $237.6 million for the comparable period of 2023. Operating loss for the first quarter of 2024 increased to $71.5 million from $30.6 million for the 2023 quarter, with the 2023 quarter benefiting from the non-recurring license payments described above totaling $59.5 million. First quarter 2024 results included a non-cash, non-recurring expense of $26.3 million related to an embedded derivative as part of our convertible debt. In addition, both periods benefited from the increase of GeneDx’s stock price of $22.7 million and $8.3 million, respectively, for 2024 and 2023. As a result, net loss for the first quarter of 2024 was $81.8 million, or $0.12 per share, compared with $18.3 million, or $0.02 per share, for the 2023 quarter.
Cash and cash equivalents: Cash and cash equivalents were $75.6 million as of March 31, 2024. In January, OPKO completed the sale of $230.0 million aggregate principal amount of 3.75% Convertible Senior Notes due 2029 and exchanged approximately $144.4 million of the Company’s outstanding 4.50% Convertible Senior Notes due 2025. The Company used approximately $50.0 million of the net proceeds to repurchase shares of the Company’s common stock from purchasers of the notes. Additionally, OPKO issued and sold approximately $71.1 million aggregate principal amount of its 3.75% Convertible Senior Notes due 2029 to several holders, including Company affiliates, in exchange for the outstanding 5% Convertible Promissory Notes and accrued interest.
Conference Call and Webcast Information
OPKO’s senior management will provide a business update, discuss first quarter financial results, provide financial guidance and answer questions during a conference call and live audio webcast today beginning at 4:30 p.m. Eastern time. Participants are encouraged to pre-register for the conference call here. Callers who pre-register will receive a unique PIN to gain immediate access to the call and bypass the live operator. Participants may register at any time, including up to and after the call start time. Those unable to pre-register may participate by dialing 833-630-0584 (U.S.) or 412-317-1815 (International). A webcast of the call can also be accessed at OPKO’s Investor Relations page and here.
A telephone replay will be available until May 21, 2024 by dialing 877-344-7529 (U.S.) or 412-317-0088 (International) and providing the passcode 6926223. A webcast replay will be available beginning approximately one hour after the completion of the live conference call here.
About OPKO Health
OPKO is a multinational biopharmaceutical and diagnostics company that seeks to establish industry-leading positions in large, rapidly growing markets by leveraging its discovery, development, and commercialization expertise and novel and proprietary technologies. For more information, visit www.opko.com.
First quarter business highlights include the following:
Entered into an agreement with Labcorp to sell select assets of BioReference Health. The transaction includes the sale of BioReference Health’s laboratory testing businesses focused on clinical diagnostics and women’s health, excluding operations in New York and New Jersey, for $237.5 million. These assets comprise patient service centers, certain customer contracts and operating assets, which account for approximately $100 million in annualized revenue. BioReference Health will continue to offer oncology and urology diagnostic services nationwide, as well as maintain its full operations in New York and New Jersey. This transaction is expected to streamline BioReference Health’s laboratory services business while retaining its core operations to better position the division for sustained growth and profitability. The transaction is subject to customary closing conditions and applicable regulatory approvals, including under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The transaction is anticipated to close in the second half of 2024.
The IND application for MDX2001, a tetraspecific antibody for the treatment of solid tumor cancers, received FDA clearance. MDX2001 is designed to optimize T-cell function while preventing tumor antigen escape. The first patient is expected to be enrolled in a Phase 1 trial to evaluate safety, tolerability, pharmacokinetics and anti-tumor activity in the second quarter of 2024.
The global launch of NGENLA® is ongoing by OPKO’s partner, Pfizer. NGENLA is approved in over 50 countries including the U.S., Japan, EU Member States, Canada and Australia. OPKO is entitled to gross profit sharing based on sales of both NGENLA and Pfizer’s daily growth hormone product, Genotropin. In addition, OPKO is entitled to an additional $100 million in potential milestone payments associated with approvals for an adult indication for growth hormone deficiency and additional pediatric indications.
First Quarter Financial Results
Pharmaceuticals: Revenue from products in the first quarter of 2024 were $38.1 million compared to $40.4 million in the first quarter of 2023, resulting from lower sales in OPKO’s international operating companies and foreign currency exchange fluctuations, partially offset by an increase in sales of Rayaldee to $6.9 million from $6.6 million. Revenue from the transfer of intellectual property and other was $8.7 million in the first quarter of 2024 compared with $64.8 million in the 2023 period, which included $5.6 million in gross profit share and royalty payments for NGENLA and Pfizer's Genotropin® in the 2024 quarter compared with $3.1 million in the same period for 2023. The decrease in revenue from the transfer of intellectual property and other is primarily attributable to one-time milestone payments received in 2023 including a $50.0 million upfront payment from Merck, a $7.0 million milestone payment from Vifor Fresenius Medical Care Renal Pharma triggered by the German price approval for Rayaldee and a $2.5 million milestone payment from Nicoya Therapeutics for the submission of its IND application for Rayaldee to China's Center for Drug Evaluation. Total costs and expenses declined to $74.5 million in the first quarter of 2024 from $86.3 million in the prior-year period primarily due to a $10.6 million, or 33%, decrease in research and development expense as the 2023 period included a non-recurring payment to Sanofi related to our Merck collaboration, partially offset by increased activity within our ModeX development programs. Operating loss was $27.7 million in the first quarter of 2024 compared with operating income of $19.0 million in the first quarter of 2023, again with 2023 benefiting from over $59 million in milestones as described above.
Diagnostics: Revenue from services in the first quarter of 2024 was $126.9 million compared with $132.4 million in the prior-year period, with the decline primarily due to lower clinical testing volume. Total costs and expenses were $161.3 million in the first quarter of 2024 compared with $172.4 million in the first quarter of 2023, reflecting the continued implementation of cost-reduction initiatives. Included in first quarter 2024 results were revenue from services of approximately $27.8 million and total costs and expenses of approximately $34.8 million related to assets being acquired by Labcorp. Operating loss was $34.4 million in the first quarter of 2024 compared with $40.0 million in the 2023 period.
Consolidated: Consolidated total revenues for the first quarter of 2024 were $173.7 million compared with $237.6 million for the comparable period of 2023. Operating loss for the first quarter of 2024 increased to $71.5 million from $30.6 million for the 2023 quarter, with the 2023 quarter benefiting from the non-recurring license payments described above totaling $59.5 million. First quarter 2024 results included a non-cash, non-recurring expense of $26.3 million related to an embedded derivative as part of our convertible debt. In addition, both periods benefited from the increase of GeneDx’s stock price of $22.7 million and $8.3 million, respectively, for 2024 and 2023. As a result, net loss for the first quarter of 2024 was $81.8 million, or $0.12 per share, compared with $18.3 million, or $0.02 per share, for the 2023 quarter.
Cash and cash equivalents: Cash and cash equivalents were $75.6 million as of March 31, 2024. In January, OPKO completed the sale of $230.0 million aggregate principal amount of 3.75% Convertible Senior Notes due 2029 and exchanged approximately $144.4 million of the Company’s outstanding 4.50% Convertible Senior Notes due 2025. The Company used approximately $50.0 million of the net proceeds to repurchase shares of the Company’s common stock from purchasers of the notes. Additionally, OPKO issued and sold approximately $71.1 million aggregate principal amount of its 3.75% Convertible Senior Notes due 2029 to several holders, including Company affiliates, in exchange for the outstanding 5% Convertible Promissory Notes and accrued interest.
Conference Call and Webcast Information
OPKO’s senior management will provide a business update, discuss first quarter financial results, provide financial guidance and answer questions during a conference call and live audio webcast today beginning at 4:30 p.m. Eastern time. Participants are encouraged to pre-register for the conference call here. Callers who pre-register will receive a unique PIN to gain immediate access to the call and bypass the live operator. Participants may register at any time, including up to and after the call start time. Those unable to pre-register may participate by dialing 833-630-0584 (U.S.) or 412-317-1815 (International). A webcast of the call can also be accessed at OPKO’s Investor Relations page and here.
A telephone replay will be available until May 21, 2024 by dialing 877-344-7529 (U.S.) or 412-317-0088 (International) and providing the passcode 6926223. A webcast replay will be available beginning approximately one hour after the completion of the live conference call here.
About OPKO Health
OPKO is a multinational biopharmaceutical and diagnostics company that seeks to establish industry-leading positions in large, rapidly growing markets by leveraging its discovery, development, and commercialization expertise and novel and proprietary technologies. For more information, visit www.opko.com.
