HUTCHMED Reports 2022 Interim Results and Provides Business Updates
HUTCHMED reported a 28% revenue increase to $202.0M for H1 2022, driven by a 113% surge in Oncology/Immunology sales to $91.1M. Key drivers include ELUNATE® ($50.4M), SULANDA® ($13.6M), and ORPATHYS® ($23.3M). The recently presented SAVANNAH data showed a 52% response rate in NSCLC patients. The company initiated six trials in 2022 and expanded its commercial team to 820 personnel. However, net loss increased to $162.9M, and cash reserves declined to $826.2M. Despite setbacks with surufatinib's FDA approval, HUTCHMED remains optimistic about its pipeline and revenue growth.
- Oncology/Immunology revenues increased 113% to $91.1 million.
- Total revenues rose 28% to $202.0 million in H1 2022.
- Key products: ELUNATE® ($50.4M), SULANDA® ($13.6M), and ORPATHYS® ($23.3M).
- SAVANNAH data presented a 52% response rate in NSCLC patients.
- Expanded in-house commercial team to 820 personnel.
- Initiated six new clinical trials in 2022.
- Net loss increased to $162.9 million in H1 2022.
- Cash reserves decreased from $1,011.7 million to $826.2 million.
- Received Complete Response Letter from FDA for surufatinib.
Oncology/Immunology revenues up
First presentation of SAVANNAH data showing
Initiated six new trials thus far in 2022 with a further six starting, including with five new drug candidates
FRESCO-2 Phase III, our first global multi-regional clinical trial, on track to read out in August 2022
Company to Host Interim Results Call & Webcast Today at 8 p.m. HKT / 1 p.m. BST / 8 a.m. EDT
HONG KONG and SHANGHAI, China and FLORHAM PARK, N.J., Aug. 01, 2022 (GLOBE NEWSWIRE) -- 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 and provides updates on key clinical and commercial developments for the six months ended June 30, 2022.
All amounts are expressed in U.S. dollars unless otherwise stated.
2022 INTERIM RESULTS & BUSINESS UPDATES
“HUTCHMED has continued to make good progress in the last six months,” said Mr Simon To, Chairman of HUTCHMED.
“We have driven revenue growth in our innovative portfolio of marketed drugs. With ELUNATE® for CRC3 and following last year’s successful launches of ORPATHYS® for MET-driven NSCLC and SULANDA® for epNETs4 and pNETs5, this will be the first full year of product sales from three novel, in-house discovered oncology products in China, with strong sales momentum. We have also significantly expanded our in-house commercial team to drive growth. On top of this, in June we announced that TAZVERIK® was approved for use in the Hainan Pilot Zone, bringing the clinical benefits of a fourth product to patients in China.”
“Our experienced clinical team has also made progress in the first half of this year. We have initiated a number of key early-stage trials and our later-stage pipeline of on-going studies are also moving at a steady pace, with promising new data from the SAVANNAH study of savolitinib combined with osimertinib being presented in more detail in August. We believe that the achievement of these milestones demonstrates the depth and potential of our R&D6 pipeline, which is the core of our business and the foundation for our growth in the years ahead.”
“HUTCHMED continues to be well-financed, which positions us well to continue delivering on our strategic objectives. We are a global biopharmaceutical company developing high quality, novel oncology and immunology drug candidates for patients across the world and under the leadership of Dr Weiguo Su, our new Chief Executive Officer, I have great hope for the future.”
Dr Weiguo Su said, “In HUTCHMED, I see a company with exciting science and a first-in-class or differentiated, best-in-class pipeline of clinical-stage candidates, each with substantial prospects for additional indications and combinations, which is exceptional, particularly in the China biopharma industry.”
“After driving our innovation as Head of Research and Chief Scientific Officer for the last 16 years, I was delighted to become the Chief Executive Officer earlier this year and am very excited about the next chapter of our growth.”
“There are several reasons which underline the opportunity in our future. These include our expected ongoing growth of ORPATHYS®, SULANDA® and ELUNATE® revenues in China, and FRESCO-2, our first global, multi-regional clinical trial, which is due to read out later this month. While receiving a Complete Response Letter for surufatinib from the U.S. FDA7 earlier this year and our decision today to withdraw the EMA8 MAA9 are a disappointment, it has no impact on our global development strategy. We will continue to leverage our solid balance sheet, strong commercial capability with extensive China coverage that generates cash, pipeline of innovative products and world-class people, as we work towards our goal of being a leading global biopharmaceutical company.”
I. COMMERCIAL OPERATIONS
- Total revenues increased
28% to$202.0 million in the first half of 2022 (H1-21:$157.4m ), driven by commercial progress on our three in-house developed oncology drugs ELUNATE®, SULANDA® and ORPATHYS®; - Oncology/Immunology consolidated revenues were up
113% to$91.1 million (H1-21:$42.9m ); - Continuing expansion of in-house oncology commercial organization in China, which in the first half of 2022 numbered about 820 personnel (end 2021: ~630) covering around 3,000 oncology hospitals and around 30,000 oncology physicians;
- ELUNATE® (fruquintinib) in-market sales10 in the first half of 2022 increased
26% to$50.4 million (H1-21:$40.1m ), reflecting its expanding lead in market share, particularly in tier 2 and 3 cities; - SULANDA® (surufatinib) in-market sales in the first half of 2022 of
$13.6 million (H1-21:$8.0m ), reflecting its first time NRDL11 inclusion which started in January 2022; - ORPATHYS® (savolitinib) in-market sales in the first half of 2022 of
$23.3 million (H1-21: nil) following its launch in the second half of 2021 through AstraZeneca’s extensive oncology commercial organization. Rapid initial self-pay uptake due to being the first-in-class selective MET inhibitor in China; - TAZVERIK® (tazemetostat) successfully launched in Hainan province in China in June 2022; and
- Successful management of commercial operations despite challenges of pandemic-related lockdowns, particularly in Shanghai in April and May 2022.
| $’millions | In-market Sales* | Consolidated Revenues** | ||||||||||||
| H1 2022 Unaudited | H1 2021 | % Change | H1 2022 Unaudited | H1 2021 | % Change | |||||||||
| ELUNATE® | 26% | 21% | ||||||||||||
| SULANDA® | 69% | 69% | ||||||||||||
| ORPATHYS® | – | – | – | – | ||||||||||
| TAZVERIK® | – | – | – | – | ||||||||||
| Product Sales | $87.4 | $48.1 | 82% | $63.5 | $37.8 | 68% | ||||||||
| Other R&D services income | 149% | |||||||||||||
| Milestone payment | – | – | ||||||||||||
| Total Oncology/Immunology | $91.1 | $42.9 | 113% | |||||||||||
| * = For ELUNATE®and ORPATHYS®,represents total sales to third parties as provided by Lilly12and AstraZeneca, respectively; ** = For ELUNATE®and ORPATHYS®,represents manufacturing fees, commercial service fees and royalties paid by Lilly and AstraZeneca, respectively, to HUTCHMED, 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
- Received Breakthrough Therapy Designation in China for sovleplenib (HMPL-523) in January 2022 for the treatment of ITP13;
- Received approval for TAZVERIK® in the Hainan Boao Lecheng International Medical Tourism Pilot Zone in May 2022 for the treatment of certain patients with epithelioid sarcoma or follicular lymphoma; and
- Received Macau approvals for ELUNATE® and SULANDA®, the first drugs approved in the territory based on China NMPA14 approval, following regulatory updates in Macau.
U.S. and Europe
- Surufatinib U.S. FDA Complete Response Letter was received in April 2022, after the NDA15 filing was accepted in June 2021, following Fast Track and Orphan Drug designations in 2020 and 2019, respectively;
- The letter indicates that a multi-regional clinical trial that includes subjects more representative of the U.S. population and aligned with current U.S. medical practice is required; and
- Pandemic-related issues concerning inspection access also contributed to the FDA action.
- HUTCHMED has decided to withdraw the surufatinib MAA filed with the EMA, following interactions with EMA reviewers which suggested that there is a low probability of a positive opinion on the MAA;
- EMA indicated that the SANET studies were not representative of patients and medical practice in the EU16; and
- The requisite pre-approval on-site inspections are currently subject to restrictions in China.
- Discussions on the path forward are ongoing with U.S. and EU regulators.
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
Major milestones and data presentations for savolitinib in 2022:
- Presentation of the SAVANNAH global Phase II study (NCT03778229) for the savolitinib plus TAGRISSO® combination in NSCLC patients harboring EGFR17 mutation and MET amplification or overexpression at WCLC18 2022;
- Results showed improved response rates with increasing levels of MET aberration. Overall results are consistent with TATTON and ORCHARD global studies, but demonstrate higher response, DoR19 and PFS20 among patients with higher MET levels, particularly among those with no prior chemotherapy;
- Opened enrollment for SAFFRON, a global, pivotal Phase III study for the savolitinib plus TAGRISSO® combination (NCT05261399). Enrolled patients will have MET levels consistent with the higher MET level patient groups in SAVANNAH and have had no prior chemotherapy; and
- Presented final Phase II OS21 in patients with MET exon 14 skipping alteration NSCLC at ELCC22 2022 (NCT02897479).
Potential upcoming clinical and regulatory milestones for savolitinib:
- Initiate SOUND, a China Phase II study for the savolitinib plus IMFINZI® combination in EGFR wild-type NSCLC patients with MET alterations (NCT05374603).
Fruquintinib (ELUNATE® in China), a highly selective oral inhibitor of VEGFR23 1/2/3 designed to improve kinase selectivity to minimize off-target toxicity and thereby improve tolerability; approved and launched in China
Major milestones and data presentations for fruquintinib in 2022:
- Presented preliminary data from the U.S. Phase Ib monotherapy study of fruquintinib in patients with refractory metastatic CRC (NCT03251378) at the 2022 ASCO GI24 Gastrointestinal Cancers Symposium; and
- Completed enrollment of the FRUTIGA China Phase III registration study (NCT03223376) in about 700 advanced gastric cancer patients.
Potential upcoming clinical and regulatory milestones for fruquintinib:
- Report top-line results of the global Phase III FRESCO-2 registration trial (NCT04322539) in 691 refractory metastatic CRC patients, recruited from 14 countries including U.S., EU, Japan and Australia, in August 2022 as the pre-specified number of OS events that triggers the primary analysis has occurred;
- If FRESCO-2 is positive, HUTCHMED plans to initiate discussions with regulatory authorities to apply for fruquintinib marketing authorization with the U.S. FDA, the EMA and the Japanese PMDA25 in the second half of 2022, with submissions targeted for completion in 2023; and
- Plan to initiate Phase III studies of fruquintinib plus PD-1 inhibitor TYVYT® combination in multiple indications in China.
Surufatinib (SULANDA® in China), an oral inhibitor of VEGFR, FGFR26 and CSF-1R27 designed to inhibit tumor angiogenesis and promote the body’s immune response against tumor cells via tumor associated macrophage regulation; approved and launched in China
Major data presentation for surufatinib in 2022:
- Presented a pooled analysis of safety data from the SANET-p and SANET-ep studies at the 2022 ASCO28 annual meetings.
Potential upcoming clinical and regulatory milestones for surufatinib:
- Submit for presentation data from the Phase Ib/II global combination study with tislelizumab at a scientific conference in 2023;
- Submit for presentation further Phase II data for the PD-1 inhibitor TUOYI® combination study in China for thyroid cancer, non-small cell lung cancer and endometrial cancer cohorts at a scientific conference in 2023; and
- Complete bridging study in NET patients in Japan (NCT05077384) in the first half of 2023 and discuss results with the Japanese PMDA.
Amdizalisib (HMPL-689), an investigative and highly selective oral inhibitor of PI3Kδ29 designed to address the gastrointestinal and hepatotoxicity associated with currently approved and clinical-stage PI3Kδ inhibitors
Potential upcoming clinical and regulatory milestones for amdizalisib:
- Plan for additional Phase II studies with potential for registration intent in China in additional relapsed/refractory lymphoma indications;
- Initiate studies in combination with tazemetostat and other anti-cancer therapies in China; and
- Complete recruitment of patients for two Phase II studies with potential for registration in China for the treatment of follicular lymphoma (with Breakthrough Therapy Designation) around the end of 2022 and marginal zone lymphoma in the first half of 2023 (NCT04849351).
Sovleplenib (HMPL-523), an investigative and highly selective oral inhibitor of Syk30, an important component of the Fc receptor and B-cell receptor signaling pathway, for the treatment of hematological malignancies and immune diseases
Potential upcoming clinical milestones for sovleplenib:
- Complete enrollment of the ESLIM-01 Phase III pivotal study in primary ITP (NCT03951623) in China around year end, with readout in 2023;
- Initiate Phase I study in the U.S. in patients with ITP in 2023;
- Initiate Phase II Proof-of-Concept study in warm AIHA31 in China; and
- Initiate exploratory Phase II trial in patients with severe or critical COVID-19 requiring hospitalization and supplemental oxygen, subject to COVID-19 outbreak.
Tazemetostat (TAZVERIK® in the U.S., Japan and the Hainan Pilot Zone), a first-in-class, oral inhibitor of EZH2 licensed from Epizyme32 for which HUTCHMED is collaborating to research, develop, manufacture and commercialize in Greater China
Major milestones and data presentations for tazemetostat in 2022:
- Initiated a bridging study in follicular lymphoma patients in China for conditional registration based on U.S. approvals; and
- Epizyme presented updated data from the Phase Ib portion of the global SYMPHONY-1 Phase III trial at ASCO (NCT04224493) of tazemetostat combined with lenalidomide and rituximab (R²) in patients with relapsed or refractory follicular lymphoma after at least one prior line of therapy.
Potential upcoming clinical and regulatory milestones for tazemetostat:
- Initiate the China portion of the global SYMPHONY-1 Phase III trial (NCT04224493); and
- Initiate Phase II combination studies with amdizalisib and other HUTCHMED assets.
HMPL-306, an investigative and highly selective oral inhibitor of IDH1/233 designed to address resistance to the currently marketed IDH inhibitors
Potential upcoming clinical and regulatory milestones for HMPL-306:
- Initiate dose expansion portion of the Phase I study in hematological malignancies in China in early 2023; and
- Initiate indication specific dose expansion cohorts of a Phase I study in the U.S. and Europe in patients with an IDH1 and/or IDH2 mutation in mid-2023 (NCT04762602).
HMPL-760, an investigative, highly selective, third-generation oral inhibitor of BTK34 with improved potency versus first generation BTK inhibitors against both wild type & C481S mutant enzymes
- Initiated China Phase I trial (NCT05190068) in patients with advanced hematological malignancies in January 2022; and
- Initiating U.S. Phase I trial (NCT05176691) in patients with advanced hematological malignancies in mid-2022.
HMPL-453, an investigative and highly selective oral inhibitor of FGFR 1/2/3
- Initiated combination studies with other anti-cancer therapies, including chemotherapies or PD-1 antibodies, in China in January 2022 (NCT05173142).
HMPL-295, an investigative and highly selective oral inhibitor of ERK in the MAPK pathway 35 with the potential to address intrinsic or acquired resistance from upstream mechanisms such as RAS-RAF-MEK
- Continuing to enroll Phase I trial (NCT04908046) in patients with advanced solid tumors in China.
HMPL-653, an investigative, oral, highly selective, and potent CSF-1R inhibitor designed to target CSF-1R driven tumors as a monotherapy or in combinations
- Initiated Phase I trial in China (NCT05190068) in patients with advanced malignant solid tumors and tenosynovial giant cell tumors in January 2022.
HMPL-A83, an investigative, differentiated, red blood cell sparing CD47 monoclonal antibody
- Initiated Phase I trial in China (NCT05429008) in patients with advanced malignant neoplasms in July 2022.
Inmagene collaboration update
- Phase I trial initiated in Australia for IMG-007, an investigative, OX40 antagonistic monoclonal antibody designed to selectively shut down OX40+ T cell function, thereby providing a treatment option for pathological OX40+ T cell-mediated immune diseases such as atopic dermatitis, in healthy volunteers and patients with severe atopic dermatitis in July 2022 (NCT05353972); and
- Phase I trial initiation imminent in healthy volunteers following IND36 clearance in the US for IMG-004, a reversible, non-covalent, highly selective oral BTK inhibitor designed to target immunological diseases (NCT05349097).
IV. MANUFACTURING
- Increased production of commercial supplies of ELUNATE®, SULANDA® and ORPATHYS® to meet demand;
- Initiated NDA enabling studies including registration stability studies and process validation for amdizalisib and sovleplenib; and
- Continued construction of our new flagship Shanghai manufacturing facility on schedule – this facility is designed to increase our novel drug product manufacturing capacity by over five-fold. Equipment installation is planned for late 2022, with Good Manufacturing Practice (GMP) compliance targeted for late 2023.
V. OTHER VENTURES
Other Ventures include our profitable prescription drug marketing and distribution platforms
- Other Ventures consolidated revenues fell
3% (-4% at CER37) to$110.9 million (H1-21:$114.5m ); - SHPL38 non-consolidated joint venture revenues grew by
18% (16% at CER) to$212.4 million (H1-21:$180.4m ); and - Consolidated net income attributable to HUTCHMED from our Other Ventures increased by
19% (16% at CER) to$35.4 million (H1-21:$29.8m , excluding net income attributable to HUTCHMED of$11.5 million contributed from HBYS39 which was disposed in September 2021), which primarily included net income contributed from SHPL of$33.6 million (H1-21:$28.6m ).
VI. IMPACT OF COVID-19
COVID-19 had some impact on our research, clinical studies and our commercial activities in the first half of 2022, particularly with respect to hospital lockdowns, travel restrictions, and shipping difficulties. Sites in Shanghai were particularly impacted during April and May. Measures were put in place to minimize the impact of such restrictions to the extent possible, including online patient follow-up and the retention of core research teams on-site to maintain critical activities, with business returning to normal in June. We will continue to closely monitor the evolving situation.
VII. SUSTAINABILITY
The Group is committed to the long-term sustainability of its businesses and the communities in which we conduct business. In the first half of 2022, we published 2021 Sustainability Report of HUTCHMED, detailing our environmental, social and governance performance of HUTCHMED during 2021, including our sustainability governance, stakeholder engagement and materiality analysis, business ethics, environmental performance, research and development, responsible commercialization, and human capital management.
Five new sustainability-related policies and statements – Sustainability Policy, Environmental Policy, Health and Safety Policy, Human Rights Policy and Modern Slavery and Human Trafficking Statement – were published along with the 2021 Sustainability Report, serving to demonstrate our commitment in sustainability, enriched and more transparent disclosures, as well as acting as an important gateway to communicate with our stakeholders in all sustainability matters.
In the second half of 2022, we will continue our efforts in facilitating discussions regarding relevant sustainability issues and opportunities, including climate-related issues, and actively looking to set our own sustainability targets and goals.
VIII. U.S. LISTING
The Holding Foreign Companies Accountable Act, or the Act, was signed into law in December 2020. It provides that if the U.S. Securities and Exchange Commission (SEC) determines that a U.S.-listed company has filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the Public Company Accounting Oversight Board (PCAOB) for three consecutive years beginning in 2021, the SEC shall prohibit such company’s shares or ADSs40 from being traded on a national securities exchange or in the over-the-counter trading market in the U.S.
As had been expected, following its adoption of implementing rules pursuant to the Act, the SEC named over 150 companies, including HUTCHMED, to its conclusive list of issuers identified under these rules. Under the current terms of the Act, the Company's ADSs will be delisted from the Nasdaq Stock Market in early 2024, unless the Act is amended to exclude the Company or the PCAOB is able to conduct a full inspection of the Company's auditor during the required timeframe. In addition, legislation is being considered in the U.S. to shorten the number of non-inspection years from three years to two. In the case that such legislation becomes law, it will reduce the time period before our ADSs could be delisted from the Nasdaq Stock Market and prohibited from over-the-counter trading in the U.S. from 2024 to 2023.
This has had no impact on the Company’s business operations. We continue to monitor market developments and evaluate all strategic options, with the appropriate counsel and guidance.
The Company’s ADSs, each of which represents five ordinary shares, continue to trade uninterrupted on the Nasdaq Global Select Market. Its ordinary shares are also admitted for trading in London on the AIM market, and are primary listed on HKEX41. The shares listed on HKEX and AIM are fully fungible with the shares represented by the Company’s ADSs.
INTERIM 2022 FINANCIAL RESULTS
Cash, Cash Equivalents and Short-Term Investments were
- Adjusted Group (non-GAAP42) net cash flows excluding financing activities in the first half of 2022 were -
$110.9 million (H1-21: -$63.1m ) mainly due to increased spending on Oncology/Immunology R&D and China commercial operations; and - Net cash used in financing activities in the first half of 2022 totaled
$74.6 million (H1-21: net cash generated from financing activities of$578.3m ) mainly due to the repayments of bank borrowings and purchases of ADSs by a trustee for the settlement of equity awards.
Revenues for the six months ended June 30, 2022 were
- Oncology/Immunology consolidated revenues increased
113% (111% at CER) to$91.1 million (H1-21:$42.9m ) resulting from:
ELUNATE® revenues increased
SULANDA® revenues increased
ORPATHYS® revenues of
TAZVERIK® revenues of
Milestone payment of
Other R&D services income of
- Other Ventures consolidated revenues decreased
3% (-4% at CER) to$110.9 million (H1-21:$114.5m ), mainly due to lower sales of consumer products. This excludes the strong18% (16% at CER) growth in non-consolidated revenues at SHPL of$212.4 million (H1-21:$180.4m ).
Net Expenses for the six months ended June 30, 2022 were
- Cost of Revenues were
$137.3 million (H1-21:$123.2m ), the majority of which were the cost of third-party prescription drug products marketed through our profitable Other Ventures, as well as costs associated with ELUNATE®, including the provision of promotion and marketing services to Lilly, and the costs for SULANDA® and ORPATHYS® which commenced commercial sales in July 2021; - R&D Expenses were
$181.7 million (H1-21:$123.1m ), which increased mainly as a result of an expansion in the active development of our novel oncology drug candidates. Our international clinical and regulatory operations in the U.S. and Europe incurred expenses of$83.6 million (H1-21:$59.3m ), while R&D expenses in China were$98.1 million (H1-21:$63.8m ); - SG&A Expenses43 were
$79.8 million (H1-21:$54.8m ), which increased primarily due to higher staff costs and selling expenses to support rapidly expanding operations. This included the scaling of a national oncology commercial infrastructure in China and in the U.S.; and - Other Items generated net income of
$33.9 million (H1-21:$41.3m ), which decreased primarily due to a reduction in equity in earnings of equity investees of$9.4 million after the divestiture of our interest in HBYS in September 2021.
Net Loss attributable to HUTCHMED for the six months ended June 30, 2022 was
- As a result, the net loss attributable to HUTCHMED in the first half of 2022 was
$0.19 per ordinary share /$0.96 per ADS, compared to net loss attributable to HUTCHMED of$0.14 per ordinary share /$0.70 per ADS in the six months ended June 30, 2021.
FINANCIAL SUMMARY
Condensed Consolidated Balance Sheets Data
(in $’000)
| As of June 30, | As of December 31, | |||
| 2022 | 2021 | |||
| (Unaudited) | ||||
| Assets | ||||
| Cash and cash equivalents and short-term investments | 826,200 | 1,011,700 | ||
| Accounts receivable | 77,078 | 83,580 | ||
| Other current assets | 118,959 | 116,796 | ||
| Property, plant and equipment | 44,059 | 41,275 | ||
| Investments in equity investees | 82,999 | 76,479 | ||
| Other non-current assets | 45,038 | 42,831 | ||
| Total assets | 1,194,333 | 1,372,661 | ||
| Liabilities and shareholders’ equity | ||||
| Accounts payable | 51,005 | 41,177 | ||
| Other payables, accruals and advance receipts | 233,606 | 210,839 | ||
| Bank borrowings | 418 | 26,905 | ||
| Other liabilities | 57,455 | 54,226 | ||
| Total liabilities | 342,484 | 333,147 | ||
| Company’s shareholders’ equity | 799,728 | 986,893 | ||
| Non-controlling interests | 52,121 | 52,621 | ||
| Total liabilities and shareholders’ equity | 1,194,333 | 1,372,661 | ||
Condensed Consolidated Statements of Operations Data
(Unaudited, in $’000, except share and per share data)
| Six Months Ended June 30, | |||||
| 2022 | 2021 | ||||
| Revenues: | |||||
| Oncology/Immunology – Marketed Products | 63,517 | 37,795 | |||
| Oncology/Immunology – R&D | 27,552 | 5,056 | |||
| Oncology/Immunology consolidated revenues | 91,069 | 42,851 | |||
| Other Ventures | 110,978 | 114,511 | |||
| Total revenues | 202,047 | 157,362 | |||
| Operating expenses: | |||||
| Costs of revenues | (137,318 | ) | (123,249 | ) | |
| Research and development expenses | (181,741 | ) | (123,050 | ) | |
| Selling and general administrative expenses | (79,742 | ) | (54,797 | ) | |
| Total operating expenses | (398,801 | ) | (301,096 | ) | |
| (196,754 | ) | (143,734 | ) | ||
| Other (expense)/income, net | (3,882 | ) | 3,287 | ||
| Loss before income taxes and equity in earnings of equity investees | (200,636 | ) | (140,447 | ) | |
| Income tax benefit/(expense) | 4,215 | (1,859 | ) | ||
| Equity in earnings of equity investees, net of tax | 33,549 | 42,966 | |||
| Net loss | (162,872 | ) | (99,340 | ) | |
| Less: Net loss/(income) attributable to non-controlling interests | 11 | (3,057 | ) | ||
| Net loss attributable to HUTCHMED | (162,861 | ) | (102,397 | ) | |
Losses per share attributable to HUTCHMED – basic and diluted (US$ per share) | (0.19 | ) | (0.14 | ) | |
| Number of shares used in per share calculation – basic and diluted | 849,283,553 | 729,239,181 | |||
Losses per ADS attributable to HUTCHMED – basic and diluted (US$ per ADS) | (0.96 | ) | (0.70 | ) | |
| Number of ADSs used in per share calculation – basic and diluted | 169,856,711 | 145,847,836 | |||
FINANCIAL GUIDANCE
We provide financial guidance for 2022 below reflecting expected revenue growth of ELUNATE®, SULANDA® and ORPATHYS® in China. We believe that we remain on track to meet the 2022 guidance for Oncology/Immunology revenues provided in the announcement of our 2021 full year results on March 3, 2022.
| H1 2022 Actual | 2022 Current Guidance | Adjustments vs. Previous Guidance | |
| Oncology/Immunology consolidated revenues | 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 – Investors may participate in the call as follows: +852 3027 6500 (Hong Kong) / +44 20 3194 0569 (U.K.) / +1 646 722 4977 (U.S.), or access a live audio webcast of the call via HUTCHMED’s website at www.hutch-med.com/event/.
Additional dial-in numbers are also available at HUTCHMED’s website. Please use participant access code “55793362#.”
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 more than 4,900 personnel across all its companies, at the center of which is a team of about 1,800 in oncology/immunology. Since inception it has advanced 13 cancer drug candidates from in-house discovery into clinical studies around the world, with its first three oncology drugs 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) 567 3786 |
| Media Enquiries | |
| Americas – Brad Miles, Solebury Trout | +1 (917) 570 7340 (Mobile) bmiles@troutgroup.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, Panmure Gordon (UK) Limited | +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 consolidated subsidiaries and joint ventures 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 drugs and product 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 candidates in development; the ability of HUTCHMED to manufacture and manage supply chains for multiple products and product 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; coverage and reimbursement determinations by such payers and new policies and procedures adopted by such payers; 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 the COVID-19 pandemic. For further discussion of these and other risks, see HUTCHMED’s filings with the U.S. Securities and Exchange Commission, on AIM and on HKEX. 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 (EU) No 596/2014 (as it forms part of retained EU law as defined in the European Union (Withdrawal) Act 2018).
REFERENCES AND ABBREVIATIONS
| 1 | NSCLC = Non-small cell lung cancer. | |
| 2 | MET = Mesenchymal epithelial transition factor. | |
| 3 | CRC = Colorectal cancer. | |
| 4 | epNET = extra-pancreatic neuroendocrine tumor. | |
| 5 | pNET= pancreatic neuroendocrine tumor. | |
| 6 | R&D = Research and development. | |
| 7 | FDA = Food and Drug Administration. | |
| 8 | EMA = European Medicines Agency. | |
| 9 | MAA = Marketing Authorization Application. | |
| 10 | In-market sales = total sales to third parties provided by Eli Lilly (ELUNATE®), AstraZeneca (ORPATHYS®) and HUTCHMED (SULANDA® and TAZVERIK®). | |
| 11 | NRDL = National Reimbursement Drug List. | |
| 12 | Lilly = Eli Lilly and Company. | |
| 13 | ITP = Immune thrombocytopenia purpura. | |
| 14 | NMPA = National Medical Products Administration. | |
| 15 | NDA = New Drug Application. | |
| 16 | EU = European Union. | |
| 17 | EGFR = Epidermal growth factor receptor. | |
| 18 | WCLC = World Conference on Lung Cancer. | |
| 19 | DoR = Duration of response. | |
| 20 | PFS = Progression-free survival. | |
| 21 | OS = Overall survival. | |
| 22 | ELCC = European Lung Cancer Congress. | |
| 23 | VEGFR = Vascular endothelial growth factor receptor. | |
| 24 | ASCO GI = ASCO (American Society of Clinical Oncology) Gastrointestinal Cancers Symposium. | |
| 25 | PMDA = Pharmaceuticals and Medical Devices Agency. | |
| 26 | FGFR = Fibroblast growth factor receptor. | |
| 27 | CSF-1R = Colony-stimulating factor 1 receptor. | |
| 28 | ASCO = American Society of Clinical Oncology. | |
| 29 | PI3Kδ = Phosphoinositide 3-kinase delta. | |
| 30 | Syk = Spleen tyrosine kinase. | |
| 31 | AIHA = autoimmune hemolytic anemia. | |
| 32 | Epizyme = Epizyme Inc. | |
| 33 | IDH = Isocitrate dehydrogenase. | |
| 34 | BTK = Bruton’s tyrosine kinase. | |
| 35 | MAPK pathway = RAS-RAF-MEK-ERK signaling cascade. | |
| 36 | IND = Investigational New Drug (application). | |
| 37 | We also report changes in performance at constant exchange rate (“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. | |
| 38 | SHPL = Shanghai Hutchison Pharmaceuticals Limited. | |
| 39 | HBYS = Hutchison Whampoa Guangzhou Baiyunshan Chinese Medicine Company Limited. | |
| 40 | ADS = American depositary share. | |
| 41 | HKEX = The Main Board of The Stock Exchange of Hong Kong Limited. | |
| 42 | GAAP = Generally Accepted Accounting Principles. | |
| 43 | SG&A Expenses = selling, general and administrative expenses. |
This announcement in its entirety is available at:
http://ml.globenewswire.com/Resource/Download/a3b4f3b3-46a4-4f26-82d9-22e353558eab
FAQ
What are HUTCHMED's revenue figures for H1 2022?
Which products contributed to HUTCHMED's revenue growth?
What was the response rate from the SAVANNAH study?
How did HUTCHMED's net loss change in H1 2022?
What challenges did HUTCHMED face with surufatinib?
