Alexion Pharmaceuticals, Inc. announced their financial results today and provided a preview of their development pipeline. Both look very healthy. During a webcast, led by CEO Leonard Bell, it was noted that the company’s sole drug, Soliris (eculizumab), had net sales of $338.9 million for its two rare disease indications - paroxysmal nocturnal hemoglobinuria (PNH) and atypical Hemolytic Uremic Syndrome (aHUS). The net sales figure is a 38% increase from the first quarter 2012 and reflects the continued growth in their sales for PNH globally as well as for their expanding markets for its new indication to treat patients with aHUS in the United States and parts of Europe.
In a press release accompanying the webcast, Dr. Bell stated “During this past quarter we continued to serve more patients with PNH around the world, as well as a growing number of aHUS patients in the US, with initial aHUS patients commencing treatment in countries of Western Europe.” Dr. Bell further noted that “The first quarter was particularly noteworthy for the significant progress across our lead development programs. This included completing enrollment in the deceased-donor kidney transplant trial and the hypophosphatasia infant natural history study, initiating plans for a single myasthenia gravis registration trial, and accelerating our cPMP clinical programs.”
Stephen Squinto, Ph.D. expanded on the pipeline during the webcast itemizing 4 additional indications Soliris that is hoping to get, as well as updates on the other drugs they have in development for rare disease.
Update on Ultra-Rare Disease Programs With Eculizumab
Neuromyelitis optica (NMO): Alexion is preparing to commence what it expects to be a single Company-sponsored, multi-national, placebo-controlled, registration trial in relapsing NMO.
Myasthenia gravis (MG): Alexion is preparing to commence what it expects to be a single Alexion-sponsored, multi-national, placebo-controlled, registration trial in severe refractory MG.
Kidney transplant: Enrollment has now been completed in the Alexion-sponsored, multi-national deceased-donor kidney transplant trial in patients at elevated risk of antibody mediated rejection (AMR). Enrollment in the Alexion-sponsored, multi-national living-donor kidney transplant trial in patients at elevated risk of AMR is on-going. Alexion is also expanding its kidney transplant program to include a delayed-graft function (DGF) clinical trial. During the webcasts, Dr. Squinto noted that data on the completed study will likely be presented later this year and that the company plan to discuss the DGF clinical trial to determine if the regulatory process can be sped up for this indication.
Shiga toxin E. coli –related hemolytic uremic syndrome (STEC-HUS): Alexion is obtaining and analyzing additional longer-term control clinical outcome data from an epidemiologic study in approximately 400 STEC-HUS patients who received only best supportive care during the 2011 German epidemic. Dr. Squinto noted that marketing authorization is expected later this year.
Other Ultra-Rare Disease Programs in Development
Asfotase Alfa: Alexion completed enrollment in a retrospective natural history study in infants with hypophosphatasia (HPP), an ultra-rare, inherited and life-threatening metabolic disease. Dr. Squinto noted that this program is on track for pediatric filing in 2014.
cPMP Replacement Therapy: Alexion is developing a cPMP replacement therapy for the treatment of patients with Molybdenum Cofactor Deficiency Type A (MoCD), a severe, ultra-rare and genetic metabolic disorder that is fatal in newborns. Alexion has commenced a retrospective cPMP study in MoCD patients and a study with the Company’s synthetic cPMP is planned.
ALXN1102/1103: Enrollment continues in a Phase I study to characterize the mechanism of action and develop initial safety data for ALXN1102 and ALXN1103, intravenous and subcutaneous versions, respectively, of one of Alexion’s novel complement inhibitors. Dr. Squinto noted in the webcast that the phase 1 study should be completed later this year and they plan meet with regulators to discuss the next steps.
ALXN1007: Alexion has completed dosing in a single-dose Phase I study of ALXN1007, a novel anti-inflammatory antibody, to evaluate the safety, tolerability, pharmacokinetics and pharmacodynamics of this therapeutic candidate in healthy volunteers. The Company expects to meet with regulators to discuss a multi-dose Phase I study.
Update on FDA’s Warning Letter
During the webcast, Drs. Squinto and Bell provided listeners with the reassurance that the warning letter they received from the FDA regarding safety concerns at their Rhode Island manufacturing plant have been addressed and that they haven taken the warning letter very seriously. Dr. Bell noted that the bacteria infection found during the inspection was also found by the company and they have ‘raised the bar’ in their quality assurances to eliminate such contaminations in the future. Furthermore, Dr. Bell said that the source of the contamination was internal (later stated to be soiled based bacteria likely from a worker’s shoe) and they have taken numerous measures to improve safety and cleanliness at the plant. The Rhode Island facility where Soliris is manufactured will continue to operate but Alexion has in place back up facilities if needed.
Dr. Squinto further stated that the supply chain was, and will not be, interrupted nor will it impact the timeframes for any of their regulatory filings.
First Quarter 2013 Financial Results (from press release)
Alexion's non-GAAP operating results are GAAP operating results adjusted for the impact of certain items described below. A full reconciliation of GAAP results to non-GAAP results is included later in this press release.
First Quarter 2013 Non-GAAP Financial Results: The Company reported non-GAAP net income of $131.3 million, or $0.65 per share, in the first quarter of 2013, compared to non-GAAP net income of $88.1 million, or $0.45 per share, in the first quarter of 2012.
Alexion's non-GAAP operating expenses for Q1 2013 were $164.4 million, compared to $119.9 million for Q1 2012. Non-GAAP research and development (R&D) expenses for Q1 2013 were $66.4 million, compared to $42.1 million for Q1 2012. Non-GAAP selling, general and administrative (SG&A) expenses for Q1 2013 were $97.9 million, compared to $77.9 million for Q1 2012.
First Quarter 2013 GAAP Financial Results: Alexion reported GAAP net income of $82.2 million, or $0.41 per share, in the first quarter of 2013, compared to GAAP net income of $45.4 million, or $0.23 per share, in the first quarter of 2012. On a GAAP basis, operating expenses for Q1 2013 were $186.7 million, compared to $146.4 million for Q1 2012. GAAP R&D expenses for Q1 2013 were $74.5 million, compared to $45.4 million for Q1 2012. GAAP SG&A expenses were $108.8 million for Q1 2013, compared to $87.2 million for Q1 2012.
Balance Sheet: As of March 31, 2013, the Company had $1.02 billion in cash and cash equivalents compared to $989.5 million at December 31, 2012.
2013 Financial Guidance: Alexion today announced that it is raising its 2013 revenue guidance from the previous range of $1.490 to $1.505 billion, now to the higher range of $1.505 to $1.520 billion. The upward revision reflects continued global growth of Soliris in PNH and growth from the ongoing launch of Soliris in aHUS. Guidance for 2013 non-GAAP earnings per share is also being raised, from the previous range of $2.82 to $2.92, now to the higher range of $2.87 to $2.97 per share. Alexion is reiterating all other items of the 2013 financial guidance provided in the Company’s press release of February 14, 2013.