Incyte Reports 2021 Second Quarter Financial Results and Provides Updates on Key Clinical Programs

Rhea-AI Summary

Incyte reports robust Q2 2021 performance, with GAAP revenue rising to $705.7 million, a 3% year-over-year increase. Key growth drivers include Jakafi product revenues, which rose 12% to $529.1 million. Notably, Pemazyre achieved a staggering 373% increase in revenues. Non-GAAP net income was $178.8 million, or $0.80 per diluted share. The company provided updated guidance, raising Jakafi revenue expectations to $2.125-$2.170 billion. Updates on ongoing clinical trials and drug approvals, including ruxolitinib and tafasitamab, signal continued advancement in their development portfolio.

Positive

• Jakafi net product revenues increased 12% to $529.1 million.
• Pemazyre revenues surged 373% to $17.9 million.
• Non-GAAP net income rose to $178.8 million, or $0.80 per diluted share.
• Upper guidance for Jakafi revenue raised to $2.125-$2.170 billion.

Negative

• GAAP operating income decreased by $90 million compared to Q2 2020.
• Milestone and contract revenues fell by 89%, significantly impacting total revenue.

Incyte (Nasdaq:INCY) today reports 2021 second quarter financial results and provides a status update on the Company’s development portfolio.

“In the second quarter, we saw an acceleration of growth of Jakafi^® (ruxolitinib) and encouraging uptake in Europe for Pemazyre^® (pemigatinib). In addition, the recent positive CHMP opinion for tafasitamab and the potential subsequent launch of tafasitamab (Minjuvi^®) in Europe represents another significant growth opportunity for Incyte,” stated Hervé Hoppenot, Chief Executive Officer, Incyte. “We continue to achieve clinical development success across our portfolio with positive outcomes from multiple programs, including topline results from ruxolitinib cream’s pivotal trials in vitiligo (TRuE-V), 52-week safety and efficacy data of ruxolitinib cream in atopic dermatitis (TRuE-AD), Phase 2 data of parsaclisib in autoimmune hemolytic anemia (AIHA) and the achievement of bioequivalence with once-daily (QD) ruxolitinib.”

Portfolio Update

MPNs and GVHD – key highlights

Ruxolitinib in GVHD: Data from the REACH3 trial of ruxolitinib versus best available therapy (BAT) in patients with steroid-refractory chronic graft-versus-host disease (GVHD) have been published in The New England Journal of Medicine. The supplemental New Drug Application (sNDA) seeking approval of ruxolitinib for the treatment of steroid-refractory chronic GVHD is under review; the Prescription Drug User Fee Act (PDUFA) date was extended to September 22, 2021.

LIMBER (Leadership In MPNs BEyond Ruxolitinib): Bioavailability and bioequivalence data were published for ruxolitinib’s QD extended release (XR) formulation at the European Hematology Association (EHA) 2021 Virtual Congress. QD ruxolitinib is in stability testing with an NDA submission planned for early 2022. Clinical studies evaluating ruxolitinib in combination with parsaclisib, INCB57643 (BET) and INCB00928 (ALK2), are progressing as expected.

Updated interim data from the proof-of-concept trial evaluating parsaclisib in combination with ruxolitinib in myelofibrosis (MF) patients with an inadequate response to ruxolitinib monotherapy were also presented at EHA.

	Indication and status
Once-a-day ruxolitinib (JAK1/JAK2)	Myelofibrosis, polycythemia vera and GVHD: clinical pharmacology studies
ruxolitinib + parsaclisib (JAK1/JAK2 + PI3Kδ)	Myelofibrosis: Phase 3 (first-line therapy) (LIMBER‑313) Myelofibrosis: Phase 3 (suboptimal responders to ruxolitinib) (LIMBER‑304)
ruxolitinib + INCB57643 (JAK1/JAK2 + BET)	Myelofibrosis: Phase 2 in preparation
ruxolitinib + INCB00928 (JAK1/JAK2 + ALK2)	Myelofibrosis: Phase 2 in preparation
itacitinib (JAK1)	Myelofibrosis: Phase 2 (second-line therapy)
ruxolitinib + CK08041 (JAK1/JAK2 + CB-Tregs)	Myelofibrosis: PoC in preparation
ruxolitinib (JAK1/JAK2)	Steroid-refractory chronic GVHD2: sNDA under review
itacitinib (JAK1)	Treatment-naïve chronic GVHD: Phase 3 (GRAVITAS‑309)

1 Development collaboration with Cellenkos, Inc.

2 Clinical development of ruxolitinib in GVHD conducted in collaboration with Novartis

Other Hematology/Oncology – key highlights

Tafasitamab: In June, Incyte and MorphoSys announced that the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) issued a positive opinion recommending the conditional marketing authorization of tafasitamab in combination with lenalidomide, followed by tafasitamab monotherapy, for the treatment of adult patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) who are not eligible for autologous stem cell transplantation (ASCT).

Updated three-year data from the Phase 2 L-MIND study evaluating tafasitamab in combination with lenalidomide as a treatment for adult patients with relapsed or refractory DLBCL were presented at EHA. Multiple studies evaluating tafasitamab as a backbone therapy in various combinations for the treatment of patients with DLBCL, follicular lymphoma, marginal zone lymphoma and other B-cell malignancies are underway, including two Phase 3 trials (inMIND and frontMIND) currently ongoing. An additional proof of concept trial (coreMIND) of tafasitamab in combination with parsaclisib for the treatment of patients with relapsed or refractory chronic lymphocytic leukemia (CLL) is expected to start in the next six months.

Pemigatinib: The ongoing launch in the United States continues to go well and the recent launches in Europe and Japan are on track. FIGHT-207, evaluating pemigatinib in tumor agnostic FGFR malignancies, is now closed to recruitment. Based on findings from this study, Incyte has identified populations that may potentially benefit from treatment with pemigatinib and intends to initiate Phase 2 studies in glioblastoma and non-small cell lung cancer by early next year.

Retifanlimab: In July, Incyte announced that the FDA issued a complete response letter for the Biologics License Application (BLA) for retifanlimab as a treatment for squamous cell carcinoma of the anal canal (SCAC). Registration-directed trials of retifanlimab in MSI-high endometrial and Merkel cell carcinoma are ongoing. The Marketing Authorization Application (MAA) seeking approval of retifanlimab in SCAC remains under review with the European Medicines Agency (EMA).

	Indication and status
pemigatinib (FGFR1/2/3)	CCA: Phase 2 (FIGHT‑202), Phase 3 (FIGHT‑302) Myeloid/lymphoid neoplasms (MLN): Phase 2 (FIGHT‑203) Tumor agnostic: Phase 2 (FIGHT-207) Glioblastoma: Phase 2 in preparation NSCLC: Phase 2 in preparation
tafasitamab (CD19)1	r/r DLBCL: Phase 2 (L-MIND); Phase 3 (B-MIND); CHMP+ opinion 1L DLBCL: Phase 1b (firstMIND); Phase 3 (frontMIND) r/r FL and r/r MZL: Phase 3 (inMIND) r/r CLL: Phase 2 (coreMIND) in preparation r/r B-cell malignancies: PoC (topMIND) with parsaclisib (PI3Kδ) in preparation r/r B-cell malignancies: PoC with lenalidomide and plamotamab in preparation2
parsaclisib (PI3Kδ)	r/r FL: Phase 2 (CITADEL‑203) r/r MZL: Phase 2 (CITADEL‑204) r/r MCL: Phase 2 (CITADEL‑205) r/r FL and r/r MZL: Phase 3 (CITADEL‑302) in preparation 1L MCL: Phase 3 (CITADEL‑310) in preparation
retifanlimab (PD‑1)3	SCAC: Phase 2 (POD1UM‑202); Phase 3 (POD1UM‑303); CRL from FDA; MAA under review MSI-high endometrial cancer: Phase 2 (POD1UM‑101, POD1UM‑204) Merkel cell carcinoma: Phase 2 (POD1UM‑201) NSCLC: Phase 3 (POD1UM‑304)
CCA = cholangiocarcinoma; DLBCL = diffuse large B-cell lymphoma; SCAC = squamous cell anal carcinoma; FL = follicular lymphoma; MZL = marginal zone lymphoma; MCL = mantle cell lymphoma; CLL = chronic lymphocytic leukemia

1 Development of tafasitamab in collaboration with MorphoSys

2 Clinical collaboration with MorphoSys and Xencor, Inc. to investigate the combination of tafasitamab plus lenalidomide in combination with Xencor’s CD20xCD3 XmAb bispecific antibody, plamotamab.

3 Retifanlimab licensed from MacroGenics

Inflammation and Autoimmunity (IAI) – key highlights

Dermatology

Ruxolitinib cream: In June, 52-week safety and efficacy data from the two Phase 3 TRuE-AD studies evaluating ruxolitinib cream in mild-to-moderate atopic dermatitis were presented at the Revolutionizing Atopic Dermatitis (RAD) virtual symposium. These data were the basis for an NDA seeking approval of ruxolitinib cream for the treatment of atopic dermatitis (AD); the PDUFA date has been extended to September 21, 2021.

A Phase 3 trial (TRuE-AD3) evaluating ruxolitinib cream in children (ages 2 to <12 years) with atopic dermatitis is ongoing.

In May, Incyte announced positive topline results from its pivotal Phase 3 TRuE-V program of ruxolitinib cream in adolescent and adult patients with vitiligo. Both TRuE-V1 and TRuE-V2 studies met the primary and key secondary endpoints, including patient reported outcomes. The overall efficacy and safety profile of ruxolitinib cream is consistent with previously reported Phase 2 data, and no new safety signals were observed. The long-term efficacy and safety portions of both studies will continue as planned. The regulatory submission seeking approval of ruxolitinib cream in vitiligo is expected later this year.

Other IAI

Parsaclisib: At EHA, Incyte presented Phase 2 data evaluating parsaclisib in autoimmune hemolytic anemia. The majority of patients achieved a response with parsaclisib over the initial 12-week treatment period. Treatment with parsaclisib was generally well tolerated. Based on these results, Incyte plans to initiate a Phase 3 trial by end of year.

	Indication and status
ruxolitinib cream (JAK1/JAK2)	Atopic dermatitis: NDA under review; Phase 3 pediatric study ongoing (TRuE-AD3) Vitiligo: Phase 3 (TRuE-V1, TRuE-V2, primary endpoint met in both studies); sNDA in preparation
INCB54707 (JAK1)	Hidradenitis suppurativa: Phase 2b Vitiligo: Phase 2
parsaclisib (PI3Kδ)	Autoimmune hemolytic anemia: Phase 2; Phase 3 in preparation
INCB00928 (ALK2)	Fibrodysplasia ossificans progressiva: Phase 2 in preparation

Discovery and early development – key highlights

Incyte’s portfolio of other earlier-stage clinical candidates is summarized below.

Modality		Candidates
Small molecules		INCB01158 (ARG)1, INCB81776 (AXL/MER), epacadostat (IDO1), INCB86550 (PD-L1), INCB106385 (A2A/A2B)
Monoclonal antibodies2		INCAGN1876 (GITR), INCAGN2385 (LAG‑3), INCAGN1949 (OX40), INCAGN2390 (TIM‑3), INCA00186 (CD73)
Bispecific antibodies		MCLA‑145 (PD-L1xCD137)3

1 INCB01158 development in collaboration with Calithera

2 Discovery collaboration with Agenus

3 MCLA‑145 development in collaboration with Merus

Partnered – key highlights

Baricitinib: In July, Incyte and Lilly announced that the FDA would not meet the PDUFA action date for the sNDA for baricitinib for the treatment of adults with moderate to severe atopic dermatitis. Baricitinib is also being studied in alopecia areata with an expected submission in H2 2021.

	Indication and status
Baricitinib (JAK1/JAK2)1	Atopic dermatitis: Phase 3 (BREEZE-AD); approved in EU and Japan; sNDA under review Severe alopecia areata: Phase 3 (BRAVE-AA1, BRAVE-AA2) Systemic lupus erythematosus: Phase 3 (BRAVE I, BRAVE II)
capmatinib (MET)2	NSCLC (with MET exon 14 skipping mutations): Approved as Tabrecta in U.S. and Japan

1 Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate-to-severe rheumatoid arthritis; approved as Olumiant in EU and Japan for certain patients with atopic dermatitis

2 Worldwide rights to capmatinib licensed to Novartis

Corporate Update

After almost 20 years at Incyte, Wenqing Yao, Ph.D. has announced his retirement as Executive Vice President and Head of Medicinal Chemistry. Dr. Yao will be succeeded by a member of his senior leadership team.

2021 Second Quarter Financial Results

The financial measures presented in this press release for the three and six months ended June 30, 2021 and 2020 have been prepared by the Company in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), unless otherwise identified as a Non-GAAP financial measure. Management believes that Non-GAAP information is useful for investors, when considered in conjunction with Incyte’s GAAP disclosures. Management uses such information internally and externally for establishing budgets, operating goals and financial planning purposes. These metrics are also used to manage the Company’s business and monitor performance. The Company adjusts, where appropriate, for expenses in order to reflect the Company’s core operations. The Company believes these adjustments are useful to investors by providing an enhanced understanding of the financial performance of the Company’s core operations. The metrics have been adopted to align the Company with disclosures provided by industry peers.

Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used in conjunction with and to supplement Incyte’s operating results as reported under GAAP. Non-GAAP measures may be defined and calculated differently by other companies in our industry.

Financial Highlights

Financial Highlights
(unaudited, in thousands, except per share amounts)
		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2021			2020			2021			2020
Total GAAP revenue		$	705,709		$	688,043		$	1,310,427		$	1,256,550
Total GAAP operating income (loss)			140,836			230,773			239,633			(433,231)
Total Non-GAAP operating income (loss)			195,568			288,514			365,871			(320,966)
GAAP net income (loss)			149,456			290,298			202,991			(430,344)
Non-GAAP net income (loss)			178,833			273,578			327,589			(345,342)
GAAP basic EPS		$	0.68		$	1.33		$	0.92		$	(1.98)
Non-GAAP basic EPS		$	0.81		$	1.26		$	1.49		$	(1.59)
GAAP diluted EPS		$	0.67		$	1.32		$	0.91		$	(1.98)
Non-GAAP diluted EPS		$	0.80		$	1.24		$	1.48		$	(1.59)

Revenue Details

Revenue Details
(unaudited, in thousands)
		Three Months Ended								Six Months Ended
		June 30,						%		June 30,						%
		2021			2020			Change		2021			2020			Change
Revenues:
Jakafi net product revenues		$	529,055		$	473,706		12%		$	994,765		$	933,185		7%
Iclusig net product revenues			28,189			22,798		24%			53,834			50,046		8%
Pemazyre net product revenues			17,906			3,786		373%			31,362			3,786		728%
Jakavi product royalty revenues			82,038			66,217		24%			147,640			122,550		20%
Olumiant product royalty revenues			36,045			25,830		40%			68,303			51,277		33%
Tabrecta product royalty revenues			2,476			706		251%			4,523			706		541%
Product and royalty revenues			695,709			593,043		17%			1,300,427			1,161,550		12%
Milestone and contract revenues			10,000			95,000		(89)%			10,000			95,000		(89)%
Total GAAP revenues		$	705,709		$	688,043		3%		$	1,310,427		$	1,256,550		4%

Product and Royalty Revenues Product and royalty revenues for the quarter ended June 30, 2021 increased 17% over the prior year comparative period as a result of increases in Jakafi, Iclusig and Pemazyre net product revenues and higher product royalty revenues from Jakavi, Olumiant and Tabrecta.

Operating Expenses

Operating Expense Summary
(unaudited, in thousands)
		Three Months Ended								Six Months Ended
		June 30,						%		June 30,						%
		2021			2020			Change		2021			2020			Change
GAAP cost of product revenues		$	38,028		$	33,364		14%		$	67,248		$	60,683		11%
Non-GAAP cost of product revenues1			32,302			27,734		16%			55,898			49,444		13%
GAAP research and development			343,511			286,601		20%			650,407			1,371,888		(53)%
Non-GAAP research and development2			315,473			254,108		24%			592,495			1,310,682		(55)%
GAAP selling, general and administrative			168,859			117,998		43%			322,654			229,146		41%
Non-GAAP selling, general and administrative3			152,523			104,434		46%			275,836			202,007		37%
GAAP change in fair value of acquisition-related contingent consideration			4,632			6,054		(23)%			10,158			12,681		(20)%
Non-GAAP change in fair value of acquisition-related contingent consideration4			—			—					—			—
GAAP collaboration loss sharing			9,843			13,253		(26)%			20,327			15,383		32%
Non-GAAP collaboration loss sharing			9,843			13,253		(26)%			20,327			15,383		32%

1 Non-GAAP cost of product revenues excludes the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the cost of stock-based compensation.

2 Non-GAAP research and development expenses exclude the cost of stock-based compensation.

3 Non-GAAP selling, general and administrative expenses exclude the cost of stock-based compensation and a legal reserve.

4 Non-GAAP change in fair value of acquisition-related contingent consideration is null.

Research and development expenses GAAP and Non-GAAP research and development expense for the quarter ended June 30, 2021 increased 20% and 24%, respectively, compared to the same period in 2020, primarily due to the progression of our pipeline including parsaclisib and our 55% share of the global and U.S. specific development costs for tafasitamab as well as product supply related costs to support the potential launch of ruxolitinib cream as a treatment for atopic dermatitis. Excluding the $12 million impact of incremental product supply costs and upfront and milestone payments, GAAP and Non-GAAP research and development expense for the quarter ended June 30, 2021 increased approximately 16% and 20%, respectively, compared to the same period in 2020.

Selling, general and administrative expenses GAAP and Non-GAAP selling, general and administrative expenses for the quarter ended June 30, 2021 increased 43% and 46%, respectively, compared to the same period in 2020, primarily due to expenses related to the establishment of our dermatology commercial organization and activities to support the potential launch of ruxolitinib cream for the treatment of atopic dermatitis.

Other Financial Information

Operating income (loss) GAAP and Non-GAAP operating income for the quarter ended June 30, 2021 decreased by $90 million and $93 million, respectively, compared to the same period in 2020 primarily due to an $85 million decrease in milestone and contract revenues.

Cash, cash equivalents and marketable securities position As of June 30, 2021 and December 31, 2020, cash, cash equivalents and marketable securities totaled $2.1 billion and $1.8 billion, respectively.

2021 Financial Guidance

Incyte is tightening its full year 2021 guidance for Jakafi net product revenues to reflect the impact of higher than anticipated government rebates and chargebacks and the new PDUFA date for ruxolitinib for the treatment of steroid-refractory chronic GVHD and is revising upward the range for other Hematology/Oncology net product revenues based on the performance of Pemazyre in the first half of 2021. In addition, the Company is reducing the range for selling, general and administrative expense to reflect lower expenses for ruxolitinib cream as a treatment for atopic dermatitis in the U.S. based on the PDUFA date extension to September 21, 2021. Guidance does not include revenue from any potential new product launches or the impact of any potential future strategic transactions. Incyte’s updated guidance is summarized below.

	Current	Previous
Jakafi net product revenues	$2,125 - $2,170 million	$2,125 - $2,200 million
Other Hematology/Oncology net product revenues	$155 - $170 million	$145 - $160 million
GAAP Cost of product revenues	6 – 7% of net product revenues	Unchanged
Non-GAAP Cost of product revenues1	5 – 6% of net product revenues	Unchanged
GAAP Research and development expenses	$1,350 - $1,390 million	Unchanged
Non-GAAP Research and development expenses2	$1,220 - $1,250 million	Unchanged
GAAP Selling, general and administrative expenses	$725 - $755 million	$735 - $775 million
Non-GAAP Selling, general and administrative expenses3	$655 - $680 million	$665 - $700 million

1 Adjusted to exclude the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the estimated cost of stock-based compensation.

2 Adjusted to exclude the estimated cost of stock-based compensation.

3 Adjusted to exclude the estimated cost of stock-based compensation and a legal reserve.

Conference Call and Webcast Information

Incyte will hold a conference call and webcast this morning at 8:00 a.m. ET. To access the conference call, please dial 877‑407‑3042 for domestic callers or 201‑389‑0864 for international callers. When prompted, provide the conference identification number, 13718346.

If you are unable to participate, a replay of the conference call will be available for 90 days. The replay dial-in number for the United States is 877‑660‑6853 and the dial-in number for international callers is 201‑612‑7415. To access the replay you will need the conference identification number, 13718346.

The conference call will also be webcast live and can be accessed at investor.incyte.com.

About Incyte

Incyte is a Wilmington, Delaware-based, global biopharmaceutical company focused on finding solutions for serious unmet medical needs through the discovery, development and commercialization of proprietary therapeutics. For additional information on Incyte, please visit Incyte.com and follow @Incyte.

About Jakafi^® (ruxolitinib)

Jakafi is a first-in-class JAK1/JAK2 inhibitor approved by the U.S. FDA for treatment of polycythemia vera (PV) in adults who have had an inadequate response to or are intolerant of hydroxyurea, in adults with intermediate or high-risk myelofibrosis (MF), including primary MF, post-polycythemia vera MF and post-essential thrombocythemia MF and for treatment of steroid-refractory acute GVHD in adult and pediatric patients 12 years and older.

Jakafi is marketed by Incyte in the United States and by Novartis as Jakavi^® (ruxolitinib) outside the United States. Jakafi is a registered trademark of Incyte Corporation. Jakavi is a registered trademark of Novartis AG in countries outside the United States.

About Tafasitamab

Tafasitamab is a humanized Fc-modified cytolytic CD19 targeting monoclonal antibody. In 2010, MorphoSys licensed exclusive worldwide rights to develop and commercialize tafasitamab from Xencor, Inc. Tafasitamab incorporates an XmAb^® engineered Fc domain, which mediates B-cell lysis through apoptosis and immune effector mechanism including Antibody-Dependent Cell-Mediated Cytotoxicity (ADCC) and Antibody-Dependent Cellular Phagocytosis (ADCP).

Monjuvi^® (tafasitamab-cxix) is approved by the U.S. Food and Drug Administration in combination with lenalidomide for the treatment of adult patients with relapsed or refractory DLBCL not otherwise specified, including DLBCL arising from low grade lymphoma, and who are not eligible for autologous stem cell transplant (ASCT). This indication is approved under accelerated approval based on overall response rate. Continued approval for this indication may be contingent upon verification and description of clinical benefit in a confirmatory trial(s).

Tafasitamab is being clinically investigated as a therapeutic option in B-cell malignancies in several ongoing combination trials.

Minjuvi^® and Monjuvi^® are registered trademarks of MorphoSys AG. Tafasitamab is marketed under the brand name Monjuvi^® in the US. If approved in the EU, tafasitamab will be marketed under the brand name Minjuvi^®.

XmAb^® is a registered trademark of Xencor, Inc.

About Pemazyre^® (pemigatinib)

Pemazyre is a kinase inhibitor indicated in the United States for the treatment of adults with previously treated, unresectable locally advanced or metastatic cholangiocarcinoma with a fibroblast growth factor receptor 2 (FGFR2) fusion or other rearrangement as detected by an FDA-approved test*. This indication is approved under accelerated approval based on overall response rate and duration of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in a confirmatory trial(s).

In Japan, Pemazyre is approved for the treatment of patients with unresectable biliary tract cancer (BTC) with a fibroblast growth factor receptor 2 (FGFR2) fusion gene, worsening after cancer chemotherapy.

In Europe, Pemazyre is approved for the treatment of adults with locally advanced or metastatic cholangiocarcinoma with a fibroblast growth factor receptor 2 (FGFR2) fusion or rearrangement that have progressed after at least one prior line of systemic therapy.

Pemazyre is a potent, selective, oral inhibitor of FGFR isoforms 1, 2 and 3 which, in preclinical studies, has demonstrated selective pharmacologic activity against cancer cells with FGFR alterations.

Pemazyre is marketed by Incyte in the United States, Europe and Japan. Incyte has granted Innovent Biologics, Inc. rights to develop and commercialize pemigatinib in hematology and oncology in Mainland China, Hong Kong, Macau and Taiwan. Incyte has retained all other rights to develop and commercialize pemigatinib outside of the United States.

Pemazyre is a trademark of Incyte Corporation.

* Pemazyre® (pemigatinib) [Package Insert]. Wilmington, DE: Incyte; 2020.

About Iclusig^® (ponatinib) tablets

Ponatinib (Iclusig^®) targets not only native BCR-ABL but also its isoforms that carry mutations that confer resistance to treatment, including the T315I mutation, which has been associated with resistance to other approved TKIs.

In the EU, Iclusig is approved for the treatment of adult patients with chronic phase, accelerated phase or blast phase chronic myeloid leukemia (CML) who are resistant to dasatinib or nilotinib; who are intolerant to dasatinib or nilotinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation, or the treatment of adult patients with Philadelphia-chromosome positive acute lymphoblastic leukemia (Ph+ ALL) who are resistant to dasatinib; who are intolerant to dasatinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation.

Click here to view the Iclusig EU Summary of Medicinal Product Characteristics.

Incyte has an exclusive license from Takeda Pharmaceuticals International AG to commercialize ponatinib in the European Union and 29 other countries, including Switzerland, UK, Norway, Turkey, Israel and Russia. Iclusig is marketed in the U.S. by Millennium Pharmaceuticals, Inc., a wholly owned subsidiary of Takeda Pharmaceutical Company Limited.

Forward-Looking Statements

Except for the historical information set forth herein, the matters set forth in this release contain predictions, estimates and other forward-looking statements, including without limitation statements regarding the potential launch of tafasitamab (Minjuvi®) in Europe and the potential significant growth opportunity represented by such potential launch and the recent positive CHMP opinion for tafasitamib; expectations regarding the NDA submission for QD ruxolitinib and the regulatory submission seeking approval of ruxolitinib cream in vitiligo; expectations regarding the launches of pemigatinib in Europe and Japan; expectations regarding the initiation of clinical trials, including a proof of concept trial of tafasitamab in combination with parsaclisib, Phase 2 trials of pemigatinib in glioblastoma and non-small cell lung cancer, and Phase 3 clinical trial for parsaclisib in autoimmune hemolytic anemia; the expected sNDA submission date for baricitinib for alopecia areata; and the Company’s revised financial guidance for 2021 and the expectations underlying such guidance.

These forward-looking statements are based on the Company’s current expectations and subject to risks and uncertainties that may cause actual results to differ materially, including unanticipated developments in and risks related to: the approval of tafasitamab in Europe and the timing of any such approval, the actual time required by the FDA to review the Company’s NDA for approval for ruxolitinib cream in atopic dermatitis and the results of such review; further research and development and the results of clinical trials possibly being unsuccessful or insufficient to meet applicable regulatory standards or warrant continued development; the ability to enroll sufficient numbers of subjects in clinical trials and the ability to enroll subjects in accordance with planned schedules; the effects of the COVID 19 pandemic and measures to address the pandemic on the Company’s clinical trials, supply chain and other third-party providers, sales and marketing efforts, and business, development and discovery operations; determinations made by the FDA and regulatory agencies outside of the United States; the Company’s dependence on its relationships with and changes in the plans of its collaboration partners; the efficacy or safety of the Company’s products and the products of the Company’s collaboration partners; the acceptance of the Company’s products and the products of the Company’s collaboration partners in the marketplace; market competition; unexpected variations in the demand for the Company’s products and the products of the Company’s collaboration partners; the effects of announced or unexpected price regulation or limitations on reimbursement or coverage for the Company’s products and the products of the Company’s collaboration partners; sales, marketing, manufacturing and distribution requirements, including the Company’s and its collaboration partners’ ability to successfully commercialize and build commercial infrastructure for newly approved products and any additional products that become approved; greater than expected expenses, including expenses relating to litigation or strategic activities; and other risks detailed from time to time in the Company’s reports filed with the Securities and Exchange Commission, including its quarterly report on Form 10 Q for the quarter ended March 31, 2021. The Company disclaims any intent or obligation to update these forward-looking statements.

INCYTE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share amounts)
		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2021			2020			2021			2020
		GAAP						GAAP
Revenues:
Product revenues, net		$	575,150		$	500,290		$	1,079,961		$	987,017
Product royalty revenues			120,559			92,753			220,466			174,533
Milestone and contract revenues			10,000			95,000			10,000			95,000
Total revenues			705,709			688,043			1,310,427			1,256,550
Costs and expenses:
Cost of product revenues (including definite-lived intangible amortization)			38,028			33,364			67,248			60,683
Research and development			343,511			286,601			650,407			1,371,888
Selling, general and administrative			168,859			117,998			322,654			229,146
Change in fair value of acquisition-related contingent consideration			4,632			6,054			10,158			12,681
Collaboration loss sharing			9,843			13,253			20,327			15,383
Total costs and expenses			564,873			457,270			1,070,794			1,689,781
Income (loss) from operations			140,836			230,773			239,633			(433,231)
Other income (expense), net			4,390			4,817			2,983			13,479
Interest expense			(358)			(600)			(717)			(1,202)
Unrealized gain (loss) on long term investments			26,765			72,274			(944)			24,142
Income (loss) before provision for income taxes			171,633			307,264			240,955			(396,812)
Provision for income taxes			22,177			16,966			37,964			33,532
Net income (loss)		$	149,456		$	290,298		$	202,991		$	(430,344)
Net income (loss) per share:
Basic		$	0.68		$	1.33		$	0.92		$	(1.98)
Diluted		$	0.67		$	1.32		$	0.91		$	(1.98)
Shares used in computing net income (loss) per share:
Basic			220,083			217,549			219,942			217,135
Diluted			222,250			220,434			222,061			217,135

INCYTE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
		June 30, 2021			December 31, 2020
ASSETS
Cash, cash equivalents and marketable securities		$	2,080,967		$	1,801,377
Accounts receivable			438,170			481,994
Property and equipment, net			661,360			559,625
Finance lease right-of-use assets, net			27,683			28,451
Inventory			52,260			35,973
Prepaid expenses and other assets			106,376			103,313
Long term investments			220,691			222,301
Other intangible assets, net			161,523			172,291
Goodwill			155,593			155,593
Total assets		$	3,904,623		$	3,560,918
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable, accrued expenses and other liabilities		$	675,516		$	648,793
Finance lease liabilities			34,246			34,857
Acquisition-related contingent consideration			259,000			266,000
Stockholders’ equity			2,935,861			2,611,268
Total liabilities and stockholders’ equity		$	3,904,623		$	3,560,918

INCYTE CORPORATION
RECONCILIATION OF GAAP NET INCOME (LOSS) TO SELECTED NON-GAAP ADJUSTED INFORMATION
(unaudited, in thousands, except per share amounts)
		Three Months Ended						Six Months Ended
		June 30,						June 30,
		2021			2020			2021			2020
GAAP Net Income (Loss)		$	149,456		$	290,298		$	202,991		$	(430,344)
Adjustments1:
Non-cash stock compensation from equity awards (R&D)2			28,038			32,493			57,912			61,206
Non-cash stock compensation from equity awards (SG&A)2			16,354			13,564			33,596			27,139
Non-cash stock compensation from equity awards (COGS)2			342			246			582			471
Non-cash interest expense related to convertible notes3			—			226			—			449
Changes in fair value of equity investments4			(26,765)			(72,274)			944			(24,142)
Amortization of acquired product rights5			5,384			5,384			10,768			10,768
Change in fair value of contingent consideration6			4,632			6,054			10,158			12,681
Legal contingency7			(18)			—			13,222			—
Tax effect of Non-GAAP adjustments8			1,410			(2,413)			(2,584)			(3,570)
Non-GAAP Net Income (Loss)		$	178,833		$	273,578		$	327,589		$	(345,342)
Non-GAAP net income (loss) per share:
Basic		$	0.81		$	1.26		$	1.49		$	(1.59)
Diluted		$	0.80		$	1.24		$	1.48		$	(1.59)
Shares used in computing Non-GAAP net income (loss) per share:
Basic			220,083			217,549			219,942			217,135
Diluted			222,250			220,434			222,061			217,135

1 Included within the Milestone and contract revenues line item in the Condensed Consolidated Statements of Operations (in thousands) for the three and six months ended June 30, 2021 and 2020 are milestones of $10,000 and $95,000, respectively, earned from our collaborative partners. Included within the Research and development expenses line item in the Condensed Consolidated Statements of Operations (in thousands) for the three and six months ended June 30, 2021 are upfront consideration and milestones of $5,000 and $16,500, respectively, related to our collaborative partners as compared to $3,500 and $809,032, respectively, for the same periods.

2 As included within the Cost of product revenues (including definite-lived intangible amortization) line item; the Research and development expenses line item; and the Selling, general and administrative expenses line item in the Condensed Consolidated Statements of Operations.

3 As included within the Interest expense line item in the Condensed Consolidated Statements of Operations.

4 As included within the Unrealized gain (loss) on long term investments line item in the Condensed Consolidated Statements of Operations.

5 As included within the Cost of product revenues (including definite-lived intangible amortization) line item in the Condensed Consolidated Statements of Operations. Acquired product rights of licensed intellectual property for Iclusig is amortized utilizing a straight-line method over the estimated useful life of 12.5 years.

6 As included within the Change in fair value of acquisition-related contingent consideration line item in the Condensed Consolidated Statements of Operations.

7 As included within Selling, general and administrative expenses line item in the Condensed Consolidated Statements of Operations.

8 As included within the Provision for income taxes line item in the Condensed Consolidated Statements of Operations. Income tax effects of Non-GAAP adjustments are calculated using the applicable statutory tax rate for the jurisdictions in which the charges are incurred, while taking into consideration any valuation allowances.

 

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FAQ

What were Incyte's Q2 2021 revenues?

Incyte reported Q2 2021 revenues of $705.7 million, a 3% increase from Q2 2020.

How did Jakafi perform in Q2 2021?

Jakafi net product revenues rose 12% year-over-year to $529.1 million in Q2 2021.

What is Incyte's updated guidance for Jakafi for 2021?

Incyte raised its Jakafi revenue guidance for 2021 to $2.125-$2.170 billion.

What growth did Pemazyre experience in Q2 2021?

Pemazyre revenues experienced a remarkable 373% increase in Q2 2021.

What is the impact of the milestone revenue drop on Incyte?

The milestone and contract revenues dropped by 89%, which adversely affected total revenue results for Q2 2021.