HUTCHMED (China) Limited (“HUTCHMED”, the “Company” or “we”)
(Nasdaq/AIM:
HCM; HKEX:
13), the
innovative, commercial-stage biopharmaceutical company, today
reports its unaudited financial results for the six months ended
June 30, 2023 and provides updates on key clinical and commercial
developments.
All amounts are expressed in U.S. dollars unless
otherwise stated.
Strategic: clinical, financial, and
regulatory progress demonstrates strong delivery on the
strategy
- Focusing on
driving near-term value creation and establishing a self-sustaining
business over the long term, with the goal of bringing
innovative medicines to patients around the world.
- Significant
progress towards bringing medicines to patients outside
China through global partnerships: closed fruquintinib
license agreement with Takeda1 in March, which can potentially
bring in up to $1.13 billion in payments including $400 million
upfront payment received, plus royalties on net sales.
Product & pipeline: fruquintinib
advancing to global launches, with continued progress across
portfolio
-
NDA2 for fruquintinib
granted priority review by the U.S.
FDA3, with a
PDUFA4 goal date of November 30,
2023. Takeda preparing for fruquintinib launches worldwide
with MAA5 validated by the EMA6 in June and the Japan NDA
submission planned this year. Global regulatory filings supported
by results from FRESCO-2, recently published in The
Lancet, and data from FRESCO.
-
Fruquintinib NDA for second-line gastric cancer accepted in
China, where fruquintinib is available and reimbursed
under the brand name ELUNATE® for the treatment of metastatic CRC7;
Breakthrough Therapy Designation in endometrial
cancer.
- All three
HUTCHMED medicines marketed in China now included in the
NRDL8.
-
Registration study readouts expected in the second half for
two potential new medicines in China, sovleplenib and
amdizalisib. New registration studies initiated
for savolitinib in gastric cancer and HMPL-453 for IHCC9;
over 15 registration studies ongoing, across seven
drug candidates.
- Productive
discovery research continues, with another novel drug
candidate in clinical development (SHP210 inhibitor HMPL-415).
Financial: HUTCHMED remains on track to
become self-sustaining in 2025
- Total
revenues up 164% (173% at CER11)
to $532.9 million for the first half of 2023, with
Oncology/Immunology consolidated revenues up 294% (301% at CER) to
$359.2 million.
- Strategy has
allowed HUTCHMED to conserve cash and significantly reduce costs,
with a substantial cash balance of $856.2 million
on June 30, 2023 including $400 million received from Takeda.
- $258.7 million of
the Takeda upfront payment recognized as revenue in the first half
of 2023, resulting in net income of $168.6 million; we expect to
recognize approximately $280 million of this payment for the full
year.
-
R&D12 expenses decreased
primarily due to our portfolio optimization efforts, while the
reduction in SG&A expenses13 was mainly due to decreased
administrative expenses after restructuring our U.S.
operations.
2023 INTERIM RESULTS & BUSINESS UPDATES
Mr Simon To, Executive Chairman of
HUTCHMED, said, “The first half of 2023 has been
successful for HUTCHMED. In late 2022, we announced our pipeline
prioritization plan and intention to seek global partners to bring
our medicines to help patients outside of China. Six months later,
this strategy is already delivering significant results to our
operations. We are successfully navigating the current challenging
capital markets, while making significant progress towards our goal
of becoming a self-sustaining, truly global biopharma company.
Crucially, it means that we are well positioned to reach more
patients than ever with our medicines.”
“In March, we closed a licensing deal for
fruquintinib with Takeda and we are confident that they have the
commitment, expertise, and commercial infrastructure to
successfully roll out this innovative medicine to patients across
the globe. The FDA Priority Review PDUFA date for fruquintinib is
now set for November 30 this year, reflecting its potential to
deliver significant improvement over currently available
treatments.”
Dr Weiguo Su, Chief Executive Officer
and Chief Scientific Officer of HUTCHMED, said, “With the
sharpening of our goals and priorities, we now have more resources
to advance our assets and drive near-term value, and we are pleased
to report on the important progress made so far this year. We have
over 15 registration/registration-intent studies ongoing with
seven drug candidates. Alongside this, our team has presented data
at a number of leading medical conferences, including AACR14,
ASCO15, ASCO GI16, EHA17 and ICML18, showcasing the productivity of
our world class R&D engine. Furthermore, commercial performance
has remained strong this year, with robust sales growth of our
in-house developed oncology products in China. All three marketed
medicines are now included on the NRDL, in line with our commitment
to patient access. Moreover, our strategy means we are in a strong
financial position as we look to continue developing our clinical
programs. We started the second half of 2023 with $856 million in
cash resources, including the $400 million received from
Takeda.”
“HUTCHMED is now well placed for further
successful product launches and life cycle extensions. In
particular, we look forward to continuing the positive momentum
with fruquintinib regulatory reviews around the world, and readouts
from our registration studies for sovleplenib and amdizalisib later
this year. As the last six months have shown, HUTCHMED clearly has
the right strategy, leadership team, and vision to become a truly
global biopharma, and I am confident that HUTCHMED will continue to
deliver on this potential.”
I. COMMERCIAL OPERATIONS
Total revenues increased 164% (173% at
CER) to $532.9 million in the first half of 2023 (H1-22:
$202.0m), driven by Oncology/Immunology partnering, its strong
commercial progress in China, and growth in third-party
distribution sales.
Oncology/Immunology consolidated
revenues were up 294% (301% at CER) to $359.2 million
(H1-22: $91.1m); driven by recognition of $258.7 million in
partnering revenue for the upfront payment from Takeda, and our
strong product sales growth resulting from in-market sales19 up 16%
(25% at CER) to $101.3 million (H1-22: $87.4m);
-
ELUNATE® (fruquintinib)
in-market sales in the first half of 2023 increased 12% (20% at
CER) to $56.3 million (H1-22: $50.4m), reflecting its
continued lead in market share;
-
SULANDA® (surufatinib)
in-market sales in the first half of 2023 increased 66% (79% at
CER) to $22.6 million (H1-22: $13.6m), reflecting the
build-up in patients on treatment over 18 months on the NRDL;
-
ORPATHYS® (savolitinib)
in-market sales in the first half of 2023 decreased 5% (increased
2% at CER) to $22.0 million (H1-22: $23.3m). Sales in the
first quarter were impacted by customary channel fluctuations ahead
of its NRDL inclusion on March 1, subsequently followed by an
increase in sales volume, with the second quarter of 2023 up 84%
compared to the second quarter of 2022;
- R&D
services income up 62% (66% at CER) to $20.4 million
(H1-22: $12.6m), now also including fees from our new partner
Takeda for the management of regulatory activities;
- Takeda
upfront payment of $400.0 million received, of which
$250.1 million (62%) attributable to the license was recognized
immediately. The remaining balance will be recognized when ongoing
services and performance obligations are completed. Up to
June 2023, we have recognized an aggregate of
$258.7 million to revenue and expect around $280 million
by year end; and
- Successful
management of commercial operations to expand coverage of oncology
hospitals and physicians despite challenges of pandemic-related
disruptions around the start of the year.
$’millions |
In-market Sales* |
Consolidated Revenues** |
|
H1 2023 |
H1 2022 |
%Δ |
(CER) |
H1 2023 |
H1 2022 |
%Δ |
(CER) |
|
Unaudited |
|
|
Unaudited |
|
|
ELUNATE® |
$56.3 |
$50.4 |
+12 |
% |
(+20%) |
$42.0 |
$36.0 |
+16 |
% |
(+25%) |
SULANDA® |
$22.6 |
$13.6 |
+66 |
% |
(+79%) |
$22.6 |
$13.6 |
+66 |
% |
(+79%) |
ORPATHYS® |
$22.0 |
$23.3 |
-5 |
% |
(+2%) |
$15.1 |
$13.8 |
+10 |
% |
(+17%) |
TAZVERIK® |
$0.4 |
$0.1 |
+560 |
% |
(+583%) |
$0.4 |
$0.1 |
+560 |
% |
(+583%) |
Products
Sales |
$101.3 |
$87.4 |
+16 |
% |
(+25%) |
$80.1 |
$63.5 |
+26 |
% |
(+35%) |
Other R&D
services income |
|
|
$20.4 |
$12.6 |
+62 |
% |
(+66%) |
Upfront
and milestone income |
|
|
$258.7 |
$15.0 |
|
|
Total Oncology/Immunology |
|
|
$359.2 |
$91.1 |
+294 |
% |
(+301%) |
Other
Ventures |
|
|
$173.7 |
$110.9 |
+57 |
% |
(+67%) |
Total revenues |
|
|
$532.9 |
$202.0 |
+164 |
% |
(+173%) |
* = For ELUNATE® and ORPATHYS®, represents total
sales to third parties as provided by Lilly20 and AstraZeneca,
respectively; and their sales to other third parties as invoiced by
HUTCHMED.** = For ELUNATE®, represents manufacturing
fees, commercial service fees and royalties paid by Lilly, to
HUTCHMED, and sales to other third parties invoiced by HUTCHMED;
for ORPATHYS® represents manufacturing fees and royalties paid by
AstraZeneca and sales to other third parties invoiced by HUTCHMED;
for SULANDA® and TAZVERIK®, represents the Company’s sales of the
products to third parties. |
II. REGULATORY UPDATES
China
- NDA
accepted in China in second-line gastric cancer for
fruquintinib in combination with paclitaxel in April
2023;
- Designated
Breakthrough Therapy in China for fruquintinib in
combination with sintilimab in July 2023 for the treatment of
advanced endometrial cancer;
- Consulted
with NMPA21 on the registration study plan of
HMPL-453 for IHCC in March 2023;
- Consulted
with NMPA on registration study plan of savolitinib for gastric
cancer in March 2023; and
- Received
Macau approvals for tazemetostat and savolitinib in March
2023.
Ex-China
-
Fruquintinib submission to U.S. FDA accepted in May
2023 and granted Priority Review for
previously treated metastatic CRC. The PDUFA goal date assigned by
the FDA is November 30, 2023;
-
Fruquintinib submission to the EMA was validated in June
2023;
-
Fruquintinib submission to the Japanese
PMDA22 expected to be completed in
2023;
-
Savolitinib, in combination with
TAGRISSO®, designated a U.S. FDA
Fast Track program in January 2023 for the treatment of
patients with NSCLC23 with MET24 overexpression and/or
amplification, and who have had disease progression during or
following prior TAGRISSO®; and
- Following dialogue
with the PMDA regarding surufatinib, we have decided not to file a
Japanese NDA on the basis of the clinical trial data
available.
III. CLINICAL DEVELOPMENT
ACTIVITIES
Savolitinib
(ORPATHYS® in China), a
highly selective oral inhibitor of MET being developed broadly
across MET-driven patient populations in lung, gastric and
papillary renal cell carcinomas
- Aligned
with FDA and enrolling the pivotal Phase II study SAVANNAH for
potential accelerated approval of the
TAGRISSO® combination
for NSCLC MET patients following progression on TAGRISSO®
(NCT03778229);
- Completed
enrollment of the confirmatory China Phase IIIb study in MET exon
14 skipping alteration NSCLC in both first-line and
second-line and above patients (NCT04923945);
- After
consultation with NMPA, initiated the registration stage of a China
Phase II study in second-line gastric cancer patients with
MET amplification (NCT04923932); and
- Continued
enrolling five other registration studies, including
SAFFRON, the global, pivotal Phase III study of the
TAGRISSO® combination supporting SAVANNAH (NCT05261399);
SACHI, a pivotal Phase III study of the TAGRISSO®
combination in China for NSCLC patients with MET amplification
following progression on EGFR25 inhibitor treatment (NCT05015608);
SANOVO, a pivotal Phase III study of the TAGRISSO®
combination in China in first-line NSCLC patients harboring EGFR
mutation and MET overexpression (NCT05009836); and
SAMETA, a global Phase III study in MET-driven
PRCC26 (NCT05043090).Potential upcoming clinical and regulatory
milestones for savolitinib:
- Complete
enrollment of SAVANNAH pivotal Phase II study in
2023;
- Complete
enrollment of SOUND, a China Phase II study of the
IMFINZI® combination in EGFR wild-type NSCLC patients with MET
alterations (NCT05374603) around year end 2023; and
- Complete
recruitment of SACHI, a pivotal Phase III study of the
TAGRISSO® combination in
China for NSCLC patients with MET amplification following
progression on EGFR inhibitor treatment (NCT05015608) in
mid-2024.
Fruquintinib
(ELUNATE® in China), a
highly selective oral inhibitor of VEGFR27 1/2/3 designed to
improve kinase selectivity to minimize off-target toxicity and
thereby improve tolerability
- Completed
recruitment of the endometrial cancer cohort of a China
Phase II study of fruquintinib in combination with PD-128 inhibitor
sintilimab in July 2023 for potential registration
(NCT03903705);
- Published
in peer-reviewed journal The Lancet
positive results of the global Phase III FRESCO-2
registration trial (NCT04322539) in previously treated
metastatic CRC patients in June 2023; and
- Updated
results from the clear cell RCC29 cohort
of a China Phase II study of fruquintinib in combination with PD-1
inhibitor sintilimab at ASCO 2023, these results led to the Phase
II/III trial (NCT05522231).Potential upcoming clinical and
regulatory milestones for fruquintinib:
- Complete
NDA submission to the Japanese PMDA in 2023;
- Submit
FRUTIGA results for presentation at a scientific
conference (NCT03223376);
- Consult
with NMPA on the results of the ongoing endometrial cancer
sintilimab combination Phase II study, which may lead to NDA
submission in the first half of 2024; and
- Complete
enrollment of China Phase II/III study of combination with
PD-1 inhibitor sintilimab in clear cell RCC (NCT05522231) around
year end 2023.
Surufatinib
(SULANDA® in China), an
oral inhibitor of VEGFR, FGFR30 and CSF-1R31 designed to inhibit
tumor angiogenesis and promote immune response against tumor cells
via tumor associated macrophage regulation
- Reported
data from the Phase Ib/II China toripalimab combination
study at the 2023 AACR and ASCO annual meetings
(NCT04169672).
Sovleplenib (HMPL-523), an
investigative and highly selective oral inhibitor of Syk32, an
important component of the Fc receptor and B-cell receptor
signaling pathway
- Completed
enrollment of a Phase II Proof-of-Concept study in warm
AIHA33 in China (NCT05535933).Potential
upcoming clinical milestones for sovleplenib:
- Report
top-line results from ESLIM-01 China Phase III in primary
ITP34 (NCT03951623) in 2023;
- Decide whether to
proceed into Phase I in ITP in US depending on the outcome of China
Phase III; and
- Decide whether to
proceed into Phase III in warm AIHA in China or continue dose
escalation, depending on the outcome of an upcoming analysis of a
Phase II Proof-of-Concept study in warm AIHA.
Amdizalisib (HMPL-689), an
investigative and highly selective oral inhibitor of PI3Kδ35
designed to address the gastrointestinal and hepatotoxicity
associated with currently approved and clinical-stage PI3Kδ
inhibitors
- Completed
recruitment of patients for China registration
Phase II study for the treatment of follicular
lymphoma (with Breakthrough Therapy Designation) in February 2023
(NCT04849351); and
- Initiated
combination trial with tazemetostat in China in February
2023 (NCT05713110).Potential upcoming clinical and regulatory
milestones for amdizalisib:
- Report
top-line results from the China registration Phase II
study for the treatment of follicular lymphoma in late 2023.
Tazemetostat
(TAZVERIK® in Macau and the
Hainan Pilot Zone), a first-in-class, oral inhibitor of
EZH2 licensed from Ipsen36 subsidiary Epizyme37 in China
- Approved and
launched in the Macau Special Administrative Region in March
2023.Potential upcoming clinical and regulatory milestones for
tazemetostat:
- Complete
recruitment of a China bridging study in follicular
lymphoma for conditional registration based on U.S.
approvals in H2 2023 (NCT05467943).
HMPL-453, a novel, highly
selective and potent inhibitor targeting FGFR 1, 2 and 3
- Reported
human data for the first time at the 2023 ASCO annual
meeting; and
- After
consultation with NMPA, initiated the registration phase of the
ongoing Phase II trial for IHCC patients with FGFR 2
fusion (NCT04353375).
Earlier stage investigational drug
candidates
In addition to the seven drug candidates being
developed in over 15 registration studies above, HUTCHMED is
developing six further oncology candidates in early-stage clinical
trials. These are HMPL-306, a highly selective
oral inhibitor of IDH1/238 designed to address resistance to
currently marketed IDH inhibitors; HMPL-760, a
highly selective, third-generation oral inhibitor of BTK39 with
improved potency versus first generation BTK inhibitors against
both wild type & C481S mutant enzymes;
HMPL-295, a highly selective oral inhibitor of
ERK40 in the MAPK pathway41 with the potential to address intrinsic
or acquired resistance from upstream mechanisms such as
RAS-RAF-MEK; HMPL-653, an oral, highly selective,
and potent CSF-1R inhibitor designed to target CSF-1R driven tumors
as a monotherapy or in combinations; HMPL-A83, a
differentiated, red blood cell sparing anti-CD47 antibody; and
HMPL-415, a novel SHP2 allosteric inhibitor that
entered clinical trials in July 2023.
Subject to data and consultation with the CDE42,
several of these earlier stage drug candidates have potential to
move into registration trials in the next 12 months.
IV. COLLABORATION UPDATES
Closed Exclusive Worldwide License to
Takeda for Fruquintinib Outside China
- Takeda is
responsible for development, manufacturing and
commercialization in all indications and territories
outside of mainland China, Hong Kong and Macau; and
- HUTCHMED is
eligible to receive up to $1.13 billion, including the $400 million
upfront received in April 2023, and up to $730 million in
additional potential payments relating to regulatory, development
and commercial sales milestones, as well as royalties on net
sales.
Further clinical progress by Inmagene
with two candidates discovered by HUTCHMED
- Inmagene
initiating a global, Phase II trial in adults with
moderate-to-severe atopic dermatitis with
IMG-007, an anti-OX40 antibody. It was safe and
well-tolerated in the completed Phase I study with no reports of
pyrexia or chills, which are common adverse events of rocatinlimab,
another anti-OX40 treatment.
- Inmagene
completed a Phase I study with IMG-004, a
reversible, non-covalent, highly selective oral BTK inhibitor
designed to target immunological diseases. IMG-004 was safe and
well-tolerated in this single-ascending-dose study, with a long
half-life and sustained pharmacodynamic effects that are well above
others in its class.
V. OTHER VENTURES
Other Ventures include our profitable
prescription drug marketing and distribution platforms
- Other
Ventures consolidated revenues increased by 57% (67% at CER) to
$173.7 million (H1-22: $110.9m);
-
SHPL43 non-consolidated
joint venture revenues increased by 11% (19% at
CER) to $235.3 million (H1-22: $212.4m);
-
Consolidated net income attributable to HUTCHMED from our
Other Ventures increased by 5% (12% at CER) to $37.2
million (H1-22: $35.4m), which was primarily due to the
net income contributed from SHPL of $35.1 million (H1-22: $33.6m);
and
- We are exploring
opportunities to monetize the underlying value of our SHPL joint
venture including various divestment and equity capital market
alternatives.
VI. IMPACT OF COVID-19
While restrictive measures related to COVID-19
were gradually lifted in China starting from December 2022,
COVꞮD-19 had some impact on our research, clinical studies and our
commercial activities in the first months of 2023. Measures were
put in place to reduce the impact and, in the second quarter of
2023, these activities normalized.
VII. SUSTAINABILITY
At HUTCHMED, we are committed to a progressive
journey as we continue to grow. This includes embedding
sustainability into all aspects of our operations and creating
long-term value for our stakeholders, including our staff, our
communities and our shareholders. In April 2023, we published our
2022 Sustainability Report alongside our 2022 Annual Report. This
year we continue to make progress in line with the commitments and
outcomes outlined in the report, including achieving satisfactory
progress to date towards the 11 short- to long-term sustainability
goals and targets and following the recommended disclosure
framework of the Task Force on Climate-related Financial
Disclosures (TCFD) in line with the risks assessment. In the second
half of 2023, we continue enhancing our climate risks action by
conducting scope 3 emissions screening, introducing a digital data
collection platform, and further strengthening our
sustainability-related disclosures.
FINANCIAL HIGHLIGHTS
Foreign exchange impact: The
RMB depreciated against the U.S. dollar on average by approximately
7% during the six months ended June 30, 2023, which has impacted
our consolidated financial results as highlighted below.
Cash, Cash Equivalents and Short-Term
Investments were $856.2 million as of June 30, 2023 compared to
$631.0 million as of December 31, 2022.
- Adjusted Group
(non-GAAP44) net cash flows excluding financing activities in the
first half of 2023 were $219.3 million (H1-22: -$110.9m) mainly due
to receipt of a $400 million payment from Takeda; and
- Net cash generated
from financing activities in the first half of 2023 totaled $5.8
million mainly due to the proceeds of bank borrowings (H1-22: net
cash used in financing activities of $74.6m mainly due to the
repayment of bank borrowings and purchases of ADSs45 by a trustee
for the settlement of equity awards).
Revenues for the six months ended June
30, 2023 were $532.9 million compared to $202.0 million in the six
months ended June 30, 2022.
-
Oncology/Immunology consolidated revenues increased 294%
(301% at CER) to $359.2 million (H1-22: $91.1m) resulting
from:
-
ELUNATE® revenues
increased 16% (25% at CER) to $42.0 million (H1-22:
$36.0m) due to continued market share gain, comprising of
manufacturing revenues, promotion and marketing service revenues
and royalties;
-
SULANDA® revenues
increased 66% (79% at CER) to $22.6 million (H1-22:
$13.6m) from our continuing marketing activities, increasing
patient access after inclusion on the NRDL in January 2022 and long
duration of treatment;
-
ORPATHYS® revenues
increased 10% (17% at CER) to $15.1 million (H1-22:
$13.8m) after inclusion in the NRDL effective from March 2023 and
comprises of manufacturing revenues and royalties;
-
TAZVERIK® revenues were
$0.4 million (H1-22: $0.1m) from further sales in the
Hainan Pilot Zone;
- Partnering
revenue of $258.7 million was the first half recognized
portion of the $400 million upfront payment from Takeda; and
- Other
R&D services income of $20.4 million (H1-22: $12.6m),
primarily related to fees from AstraZeneca, Lilly and Takeda for
the management of development and regulatory activities.
- Other
Ventures consolidated revenues increased 57% (67% at CER) to $173.7
million (H1-22: $110.9m), mainly due to higher sales of
prescription drugs. This excludes 11% (19% at CER) growth in
non-consolidated revenues at SHPL of $235.3 million (H1-22:
$212.4m).
Net Expenses for the six months ended
June 30, 2023 were $364.3 million compared to $364.9 million for
the six months ended June 30, 2022.
- Costs of
Revenues increased by 52% to $208.3 million (H1-22:
$137.3m), of which cost of revenues from our Other Ventures
increased by 63% to $164.8 million (H1-22: $101.0m) due to the
increasing sales of third-party prescription drug products, and
cost of revenues from Oncology/Immunology increased by 20% to $43.5
million (H1-22: $36.3m) due to the increasing sales of ELUNATE®,
SULANDA® and ORPATHYS®;
- R&D
Expenses reduced 20% to $144.6 million (H1-22: $181.7m),
mainly as a result of the strategic prioritization of our pipeline.
Our international clinical and regulatory operations in the U.S.
and Europe incurred expenses of $55.6 million (H1-22: $83.6m),
while R&D expenses in China were $89.0 million (H1-22:
$98.1m);
- SG&A
Expenses were $68.3 million (H1-22: $79.8m), which
decreased primarily due to the restructuring of our U.S.
Oncology/Immunology commercial operations at the end of 2022 while
our China commercial infrastructure was able to support further
revenue growth; and
- Other
Items generated net income of $56.9 million (H1-22:
$33.9m), which increased primarily due to higher interest income
earned after receiving the $400 million Takeda upfront payment in
April 2023 and foreign currency exchange gains.
Net Income attributable to HUTCHMED for
the six months ended June 30, 2023 was $168.6 million (which
include $258.7 million of the upfront payment recognized from
Takeda) compared to Net Loss attributable to HUTCHMED of $162.9
million for the six months ended June 30, 2022.
- The net income
attributable to HUTCHMED for the six months ended June 30, 2023 was
$0.20 per ordinary share / $1.00 per ADS, compared to net loss
attributable to HUTCHMED of $0.19 per ordinary share / $0.96
per ADS for the six months ended June 30, 2022.
FINANCIAL SUMMARY
Condensed Consolidated Balance Sheets Data
(in $’000)
|
As of June 30, 2023 |
|
As of December 31,2022 |
|
(Unaudited) |
|
|
Assets |
|
|
|
Cash and cash equivalents and short-term investments |
856,168 |
|
630,996 |
Accounts receivable |
129,203 |
|
97,988 |
Other current assets |
105,114 |
|
110,904 |
Property, plant and equipment |
96,829 |
|
75,947 |
Investments in equity investees |
37,740 |
|
73,777 |
Other non-current assets |
72,443 |
|
39,833 |
Total
assets |
1,297,497 |
|
1,029,445 |
Liabilities and
shareholders’ equity |
|
|
|
Accounts payable |
54,575 |
|
71,115 |
Other payables, accruals and advance receipts |
227,212 |
|
264,621 |
Deferred revenue |
149,440 |
|
13,537 |
Bank borrowings |
40,147 |
|
18,104 |
Other liabilities |
26,106 |
|
25,198 |
Total
liabilities |
497,480 |
|
392,575 |
Company’s
shareholders’ equity |
782,039 |
|
610,367 |
Non-controlling interests |
17,978 |
|
26,503 |
Total liabilities and
shareholders’ equity |
1,297,497 |
|
1,029,445 |
|
|
|
|
Condensed Consolidated Statements of Operations
Data
(Unaudited, in $’000, except share and per share
data)
|
Six Months Ended June 30 |
|
2023 |
|
2022 |
Revenues: |
|
|
|
Oncology/Immunology – Marketed Products |
80,149 |
|
|
63,517 |
|
Oncology/Immunology – R&D |
279,034 |
|
|
27,552 |
|
Oncology/Immunology consolidated revenues |
359,183 |
|
|
91,069 |
|
Other Ventures |
173,691 |
|
|
110,978 |
|
Total revenues |
532,874 |
|
|
202,047 |
|
|
|
|
|
Operating
expenses: |
|
|
|
Costs of revenues |
(208,324 |
) |
|
(137,318 |
) |
Research and development expenses |
(144,633 |
) |
|
(181,741 |
) |
Selling and general administrative expenses |
(68,263 |
) |
|
(79,742 |
) |
Total operating expenses |
(421,220 |
) |
|
(398,801 |
) |
|
|
|
|
|
111,654 |
|
|
(196,754 |
) |
Other income/(expense), net |
25,434 |
|
|
(3,882 |
) |
Income/(loss) before
income taxes and equity in earnings of equity
investees |
137,088 |
|
|
(200,636 |
) |
Income tax (expense)/benefit |
(2,730 |
) |
|
4,215 |
|
Equity in earnings of equity investees, net of tax |
35,110 |
|
|
33,549 |
|
Net
income/(loss) |
169,468 |
|
|
(162,872 |
) |
Less: Net (income)/loss
attributable to non-controlling interests |
(917 |
) |
|
11 |
|
Net income/(loss)
attributable to HUTCHMED |
168,551 |
|
|
(162,861 |
) |
|
|
|
|
Earnings/(losses) per share attributable to HUTCHMED (US$
per share) |
|
|
– basic |
0.20 |
|
|
(0.19 |
) |
– diluted |
0.19 |
|
|
(0.19 |
) |
Number of shares used in per
share calculation |
|
|
|
– basic |
846,928,863 |
|
|
849,283,553 |
|
– diluted |
866,990,610 |
|
|
849,283,553 |
|
|
|
|
|
Earnings/(losses) per ADS attributable to HUTCHMED (US$ per
ADS) |
|
|
– basic |
1.00 |
|
|
(0.96 |
) |
– diluted |
0.97 |
|
|
(0.96 |
) |
Number of ADSs used in per
share calculation |
|
|
|
– basic |
169,385,773 |
|
|
169,856,711 |
|
– diluted |
173,398,122 |
|
|
169,856,711 |
|
FINANCIAL GUIDANCE
Following the closing of the license with Takeda
and having received from them the upfront payment of $400 million,
we currently expect to recognize approximately $280 million in
2023.
We provide financial guidance for
Oncology/Immunology consolidated revenues, reflecting expected
revenue growth of our oncology products in China; R&D services
income from our partners AstraZeneca, Lilly and Takeda; potential
milestone payments on fruquintinib U.S. regulatory approval; and
the above-mentioned recognition of the upfront payment from Takeda.
We believe that we remain on track to meet the 2023 guidance
provided in the announcement of our 2022 full year results on
February 28, 2023.
|
H1 2022Actual |
H1 2023Actual |
FY 2022Actual |
FY 2023Guidance |
Adjustments vs.Previous Guidance |
Oncology/Immunology consolidated revenues |
$91.1 million |
$359.2 million |
$163.8 million |
$450 – $550 million |
Nil |
Shareholders and investors should note that:
- we do not provide any guarantee
that the statements contained in the financial guidance will
materialize or that the financial results contained therein will be
achieved or are likely to be achieved; and
- we have in the past revised our
financial guidance and reference should be made to any
announcements published by us regarding any updates to the
financial guidance after the date of publication of this
announcement.
Use of Non-GAAP Financial Measures and
Reconciliation – References in this announcement to
adjusted Group net cash flows excluding financing activities and
financial measures reported at CER are based on non-GAAP financial
measures. Please see the “Use of Non-GAAP Financial Measures and
Reconciliation” below for further information relevant to the
interpretation of these financial measures and reconciliations of
these financial measures to the most comparable GAAP measures,
respectively.
Conference call and audio webcast
presentation scheduled today at 8 p.m. HKT /
1 p.m. BST / 8 a.m. EDT. After
registering, investors may access a live audio webcast of the call
via HUTCHMED’s website at www.hutch-med.com/event/.
Participants who wish to join the call by
telephone and ask a question must register. Upon registration, each
participant will be provided with dial-in numbers and a unique
PIN.
HUTCHMED intends to host a Capital Markets Day
in the fourth quarter of this year to further update the market on
its progress following the strategy change, and to showcase the
exciting pipeline of drug candidates.
About HUTCHMED
HUTCHMED (Nasdaq/AIM: HCM;
HKEX: 13) is an innovative, commercial-stage,
biopharmaceutical company. It is committed to the discovery, global
development and commercialization of targeted therapies and
immunotherapies for the treatment of cancer and immunological
diseases. It has approximately 5,000 personnel across all its
companies, at the center of which is a team of about 1,800 in
oncology/immunology. Since inception, HUTCHMED has focused on
bringing cancer drug candidates from in-house discovery to patients
around the world, with its first three oncology medicines now
approved and marketed in China. For more information, please visit:
www.hutch-med.com or follow us on LinkedIn.
Contacts
Investor
Enquiries |
|
Mark Lee, Senior Vice
President |
+852 2121 8200 |
Annie Cheng, Vice President |
+1 (973) 306-4490 |
|
|
Media
Enquiries |
|
Americas – Brad
Miles, Solebury Strategic Communications |
+1 (917) 570 7340 (Mobile) /
bmiles@soleburystrat.com |
Europe – Ben
Atwell / Alex Shaw, FTI Consulting |
+44 20 3727 1030 /
+44 7771 913 902 (Mobile) /
+44 7779 545 055 (Mobile) /
HUTCHMED@fticonsulting.com |
Asia – Zhou Yi,
Brunswick |
+852 9783 6894 (Mobile) /
HUTCHMED@brunswickgroup.com |
|
|
Nominated
Advisor |
|
Atholl Tweedie / Freddy Crossley
/ Daphne Zhang, Panmure Gordon |
+44 (20) 7886 2500 |
References
Unless the context requires otherwise,
references in this announcement to the “Group,” the “Company,”
“HUTCHMED,” “HUTCHMED Group,” “we,” “us,” and “our,” mean HUTCHMED
(China) Limited and its subsidiaries unless otherwise stated or
indicated by context.
Past Performance and Forward-Looking
Statements
The performance and results of operations of the
Group contained within this announcement are historical in nature,
and past performance is no guarantee of future results of the
Group. This announcement contains forward-looking statements within
the meaning of the “safe harbor” provisions of the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified by words like “will,” “expects,”
“anticipates,” “future,” “intends,” “plans,” “believes,”
“estimates,” “pipeline,” “could,” “potential,” “first-in-class,”
“best-in-class,” “designed to,” “objective,” “guidance,” “pursue,”
or similar terms, or by express or implied discussions regarding
potential drug candidates, potential indications for drug
candidates or by discussions of strategy, plans, expectations or
intentions. You should not place undue reliance on these
statements. Such forward-looking statements are based on the
current beliefs and expectations of management regarding future
events, and are subject to significant known and unknown risks and
uncertainties. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those set forth in the
forward-looking statements. There can be no guarantee that any of
our drug candidates will be approved for sale in any market, that
any approvals which are obtained will be obtained at any particular
time, or that the sales of products marketed or otherwise
commercialized by HUTCHMED and/or its collaboration partners
(collectively, “HUTCHMED’s Products”) will achieve any particular
revenue or net income levels. In particular, management’s
expectations could be affected by, among other things: unexpected
regulatory actions or delays or government regulation generally,
including, among others, the risk that HUTCHMED’s ADSs could be
barred from trading in the United States as a result of the Holding
Foreign Companies Accountable Act and the rules promulgated
thereunder; the uncertainties inherent in research and development,
including the inability to meet our key study assumptions regarding
enrollment rates, timing and availability of subjects meeting a
study’s inclusion and exclusion criteria and funding requirements,
changes to clinical protocols, unexpected adverse events or safety,
quality or manufacturing issues; the inability of a drug candidate
to meet the primary or secondary endpoint of a study; the inability
of a drug candidate to obtain regulatory approval in different
jurisdictions or the utilization, market acceptance and commercial
success of HUTCHMED’s Products after obtaining regulatory approval;
competing products and drug candidates that may be superior to, or
more cost effective than, HUTCHMED’s Products and drug candidates;
the impact of studies (whether conducted by HUTCHMED or others and
whether mandated or voluntary) or recommendations and guidelines
from governmental authorities and other third parties on the
commercial success of HUTCHMED’s Products and drug candidates in
development; the ability of HUTCHMED to manufacture and manage
supply chains for multiple products and drug candidates; the
availability and extent of reimbursement of HUTCHMED’s Products
from third-party payers, including private payer healthcare and
insurance programs and government insurance programs; the costs of
developing, producing and selling HUTCHMED’s Products; the ability
of HUTCHMED to meet any of its financial projections or guidance
and changes to the assumptions underlying those projections or
guidance; global trends toward health care cost containment,
including ongoing pricing pressures; uncertainties regarding actual
or potential legal proceedings, including, among others, actual or
potential product liability litigation, litigation and
investigations regarding sales and marketing practices,
intellectual property disputes, and government investigations
generally; and general economic and industry conditions, including
uncertainties regarding the effects of the persistently weak
economic and financial environment in many countries, uncertainties
regarding future global exchange rates and uncertainties regarding
the impact of COVID-19. For further discussion of these and other
risks, see HUTCHMED’s filings with the U.S. Securities and Exchange
Commission, on AIM and on HKEX46. HUTCHMED is providing the
information in this announcement as of this date and does not
undertake any obligation to update any forward-looking statements
as a result of new information, future events or otherwise.
In addition, this announcement contains
statistical data and estimates that HUTCHMED obtained from industry
publications and reports generated by third-party market research
firms. Although HUTCHMED believes that the publications, reports
and surveys are reliable, HUTCHMED has not independently verified
the data and cannot guarantee the accuracy or completeness of such
data. You are cautioned not to give undue weight to this data. Such
data involves risks and uncertainties and are subject to change
based on various factors, including those discussed above.
Inside Information
This announcement contains inside information
for the purposes of Article 7 of Regulation (E.U.) No 596/2014 (as
it forms part of retained E.U. law as defined in the European Union
(Withdrawal) Act 2018).
This announcement in its entirety is available at:
http://ml.globenewswire.com/Resource/Download/4a6834bd-1a7d-4ed8-83de-c19ac2fd523c
____________________
REFERENCES AND ABBREVIATIONS |
1 |
Takeda = Takeda Pharmaceuticals International AG. |
2 |
NDA = New Drug Application. |
3 |
FDA = Food and Drug
Administration. |
4 |
PDUFA = U.S. Prescription
Drug User Fee Act. |
5 |
MAA = Marketing
Authorization Application. |
6 |
EMA = European Medicines
Agency. |
7 |
CRC = Colorectal
cancer. |
8 |
NRDL = National Reimbursement
Drug List. |
9 |
IHCC = Intrahepatic
cholangiocarcinoma. |
10 |
SHP2 = Src homology-2
domain-containing protein tyrosine phosphatase-2. |
11 |
CER = Constant exchange rate. We also report changes in performance
at CER which is a non-GAAP measure. Please refer to “Use of
Non-GAAP Financial Measures and Reconciliation” below for further
information relevant to the interpretation of these financial
measures and reconciliations of these financial measures to the
most comparable GAAP measures. |
12 |
R&D = Research and
development. |
13 |
SG&A expenses
= Selling, general and administrative expenses. |
14 |
AACR = American Association for
Cancer Research. |
15 |
ASCO = American Society of
Clinical Oncology. |
16 |
ASCO GI = ASCO (American Society
of Clinical Oncology) Gastrointestinal Cancers Symposium. |
17 |
EHA = European Hematology
Association. |
18 |
ICML = International
Conference on Malignant Lymphoma. |
19 |
In-market sales = total sales to
third parties provided by Eli Lilly (ELUNATE®), AstraZeneca
(ORPATHYS®) and HUTCHMED (ELUNATE®, SULANDA®,
ORPATHYS® and TAZVERIK®). |
20 |
Lilly = Eli Lilly and
Company. |
21 |
NMPA = National Medical Products
Administration. |
22 |
PMDA = Pharmaceuticals and
Medical Devices Agency. |
23 |
NSCLC = Non-small cell
lung cancer. |
24 |
MET = Mesenchymal epithelial
transition factor. |
25 |
EGFR = Epidermal growth factor
receptor. |
26 |
PRCC = Papillary renal cell
carcinoma. |
27 |
VEGFR = Vascular endothelial
growth factor receptor. |
28 |
PD-1 = Programmed cell death
protein-1. |
29 |
RCC = Renal cell carcinoma. |
30 |
FGFR = Fibroblast growth factor
receptor. |
31 |
CSF-1R = Colony-stimulating
factor 1 receptor. |
32 |
Syk = Spleen tyrosine
kinase. |
33 |
AIHA
= Autoimmune hemolytic anemia. |
34 |
ITP = Immune
thrombocytopenia purpura. |
35 |
PI3Kδ = Phosphoinositide 3-kinase delta. |
36 |
Ipsen = Ipsen SA, parent
of Epizyme Inc. |
37 |
Epizyme = Epizyme Inc., a wholly owned subsidiary of
Ipsen SA. |
38 |
IDH = Isocitrate
dehydrogenase. |
39 |
BTK = Bruton’s tyrosine
kinase. |
40 |
ERK = Extracellular
signal-regulated kinase. |
41 |
MAPK pathway
= RAS-RAF-MEK-ERK signaling cascade. |
42 |
CDE = Center for Drug
Evaluation. |
43 |
SHPL = Shanghai Hutchison
Pharmaceuticals Limited. |
44 |
GAAP = Generally
Accepted Accounting Principles. |
45 |
ADS = American depositary
share. |
46 |
HKEX = The Main Board of The
Stock Exchange of Hong Kong Limited. |
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