Novocure Reports Second Quarter 2024 Financial Results

Rhea-AI Summary

Novocure (NVCR) reported strong Q2 2024 financial results, with net revenues of $150.4 million, up 19% year-over-year. The company had 3,963 active patients on therapy as of June 30, 2024, an 11% increase from the previous year. Key highlights include:

- Successful launch in France and improved U.S. approval rates
- Positive results from Phase 3 METIS trial in brain metastases from non-small cell lung cancer
- 1,634 prescriptions received, up 5% year-over-year
- Gross margin of 77%
- Net loss of $33.4 million with loss per share of $0.31
- Cash, cash equivalents, and short-term investments of $951.2 million

Novocure continues to focus on growing its commercial business in glioblastoma, launching in non-small cell lung cancer, and advancing its clinical and product development pipelines.

Positive

• Net revenues increased by 19% year-over-year to $150.4 million
• Active patients on therapy grew by 11% to 3,963
• Prescriptions received increased by 5% to 1,634
• Successful launch in France and improved U.S. approval rates
• Positive results from Phase 3 METIS trial in brain metastases from NSCLC
• Strong cash position with $951.2 million in cash, cash equivalents, and short-term investments

Negative

• Net loss of $33.4 million with loss per share of $0.31
• Research, development, and clinical studies expenses decreased by 1%
• Sales and marketing expenses decreased by 3%
• General and administrative expenses decreased by 8%

Insights

Financial Analyst

Novocure's Q2 2024 results show promising growth, with net revenues of $150.4 million, up 19% year-over-year. This growth is primarily driven by a successful launch in France and improved U.S. approval rates. However, it's important to note that $7.6 million of this revenue is from non-recurring sources.

The company's gross margin remains strong at 77%, indicating efficient operations. However, Novocure still reported a net loss of $33.4 million, or $0.31 per share. This suggests that while the company is growing, it's still investing heavily in research and development ($55 million this quarter) to fuel future growth.

With $951.2 million in cash and short-term investments, Novocure has a solid financial foundation to continue its operations and fund its clinical trials. The 11% increase in active patients to 3,963 is a positive indicator of growing adoption of their Tumor Treating Fields therapy.

Investors should keep an eye on the upcoming PANOVA-3 clinical trial results in Q4 2024, as positive outcomes could significantly impact the company's future growth potential.

Medical Research Analyst

The positive results from the Phase 3 METIS trial presented at ASCO 2024 are a significant milestone for Novocure. The trial demonstrated a statistically significant improvement in time to intracranial progression for patients with brain metastases from non-small cell lung cancer (NSCLC) when treated with TTFields therapy and supportive care compared to supportive care alone.

This outcome is important as it potentially expands the application of TTFields therapy beyond glioblastoma, opening up a new market in NSCLC brain metastases. Brain metastases are a common and difficult-to-treat complication in NSCLC patients and new effective therapies are desperately needed.

Additionally, the TIGER study results, showing consistency with the phase 3 EF-14 clinical trial in newly diagnosed GBM, provide real-world evidence supporting the efficacy and safety of TTFields therapy. This data could help drive further adoption among oncologists and patients.

The upcoming PANOVA-3 trial results in locally advanced pancreatic cancer, expected in Q4 2024, could potentially open yet another significant market for Novocure if positive. Pancreatic cancer has notoriously poor outcomes and any effective new treatment would likely see rapid adoption.

Quarterly net revenues of $150 million, up 19% year-over-year, with 3,963 active patients on therapy as of June 30, 2024

Positive results from Phase 3 METIS trial in brain metastases from non-small cell lung cancer presented at ASCO 2024

ROOT, Switzerland--(BUSINESS WIRE)-- Novocure (NASDAQ: NVCR) today reported financial results for the quarter ended June 30, 2024. Novocure is a global oncology company working to extend survival in some of the most aggressive forms of cancer by developing and commercializing its innovative therapy, Tumor Treating Fields (TTFields).

“The second quarter was a period of consistent execution at Novocure,” said Asaf Danziger, Novocure’s Chief Executive Officer. “We began the year with three key objectives – grow our commercial business in glioblastoma, launch our next indication in non-small cell lung cancer, and deliver on the promise of our clinical and product development pipelines. I am pleased to share we have made significant progress on all fronts this quarter.”

Financial updates for the second quarter ended June 30, 2024:

• Total net revenues for the quarter were $150.4 million, an increase of 19% compared to the same period in 2023. This increase is primarily driven by our successful launch in France and improved U.S. approval rates.
  • The United States, Germany, France and Japan contributed $95.7 million, $15.1 million, $14.3 million and $7.7 million, respectively, with other active markets contributing $11.8 million.
  • Revenue in Greater China from Novocure’s partnership with Zai Lab totaled $5.8 million.
  • Improved approval rates in the U.S. resulted in $5.0 million of increased net revenue from prior period claims during the quarter. In addition, we received $2.6 million in net revenues from a private payer in the United Kingdom where payments are not routine. We do not expect these two benefits, totaling $7.6 million, to recur.
• Gross margin for the quarter was 77%.
• Research, development and clinical studies expenses for the quarter were $55.0 million, a decrease of 1% from the same period in 2023.
• Sales and marketing expenses for the quarter were $56.6 million, a decrease of 3% compared to the same period in 2023. This primarily reflects lower personnel expenses associated with support functions.
• General and administrative expenses for the quarter were $37.7 million, a decrease of 8% compared to the same period in 2023. This primarily reflects lower personnel expenses.
• Net loss for the quarter was $33.4 million with loss per share of $0.31.
• Adjusted EBITDA* for the quarter was $1.1 million.
• Cash, cash equivalents and short-term investments were $951.2 million as of June 30, 2024.

Operational updates for the second quarter ended June 30, 2024:

• 1,634 prescriptions were received in the quarter, an increase of 5% compared to the same period in 2023. Prescriptions from the United States, Germany, France and Japan contributed 957, 206, 176 and 108 prescriptions, respectively, with the remaining 187 prescriptions received in other active markets.
• As of June 30, 2024, there were 3,963 active patients on therapy, an increase of 11% compared to the same period in 2023. Active patients from the United States, Germany, France and Japan contributed 2,175, 538, 369 and 403 active patients, respectively, with the remaining 478 active patients contributed by other active markets.

Quarterly updates and achievements:

• In June, we presented positive results from the phase 3 METIS trial, evaluating the use of TTFields therapy and supportive care for the treatment of patients with brain metastases from non-small cell lung cancer (NSCLC) following stereotactic radiosurgery at the 2024 American Society of Clinical Oncology (ASCO) annual meeting. The METIS trial met its primary endpoint, demonstrating a statistically significant improvement in time to intracranial progression for adult patients treated with TTFields therapy and supportive care compared to patients treated with supportive care alone.
• In June, we presented top-line results from the prospective, non-interventional TIGER study at the 2024 ASCO annual meeting. TIGER investigated the use of TTFields therapy in routine clinical use in the treatment of newly diagnosed GBM in Germany. The outcomes observed in the TIGER study are consistent with the survival and safety results from our phase 3 EF-14 clinical trial. TTFields therapy use was not associated with an increase in systemic toxicity and was well tolerated.

Anticipated clinical milestones:

• Top-line data from phase 3 PANOVA-3 clinical trial in locally advanced pancreatic cancer (Q4 2024)

Conference call details

Novocure will host a conference call and webcast to discuss second quarter 2024 financial results at 8:00 a.m. EDT today, Thursday, July 25, 2024. To access the conference call by phone, use the following conference call registration link and dial-in details will be provided. To access the webcast, use the following webcast registration link.

The webcast, earnings slides presented during the webcast and the corporate presentation can be accessed live from the Investor Relations page of Novocure’s website, www.novocure.com/investor-relations, and will be available for at least 14 days following the call. Novocure has used, and intends to continue to use, its investor relations website, as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

About Novocure

Novocure is a global oncology company working to extend survival in some of the most aggressive forms of cancer through the development and commercialization of its innovative therapy, Tumor Treating Fields. Novocure’s commercialized products are approved in certain countries for the treatment of adult patients with glioblastoma, malignant pleural mesothelioma and pleural mesothelioma. Novocure has ongoing or completed clinical trials investigating Tumor Treating Fields in brain metastases, gastric cancer, glioblastoma, liver cancer, non-small cell lung cancer, pancreatic cancer and ovarian cancer.

Headquartered in Root, Switzerland and with a growing global footprint, Novocure has regional operating centers in Portsmouth, New Hampshire and Tokyo, as well as a research center in Haifa, Israel. For additional information about the company, please visit Novocure.com and follow @Novocure on LinkedIn and Twitter.

*Non-GAAP Financial Measurements

We measure our performance based upon a non-U.S. GAAP measurement of earnings before interest, taxes, depreciation, amortization and shared-based compensation ("Adjusted EBITDA"). We believe Adjusted EBITDA is useful to investors in evaluating our operating performance because it helps investors compare the results of our operations from period to period by removing the impact of earnings attributable to our capital structure, tax rate and material non-cash items, specifically share-based compensation.

Forward-Looking Statements

In addition to historical facts or statements of current condition, this press release may contain forward-looking statements. Forward-looking statements provide Novocure’s current expectations or forecasts of future events. These may include statements regarding anticipated scientific progress on its research programs, clinical trial progress, development of potential products, interpretation of clinical results, prospects for regulatory approval, manufacturing development and capabilities, market prospects for its products, coverage, collections from third-party payers and other statements regarding matters that are not historical facts. You may identify some of these forward-looking statements by the use of words in the statements such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe” or other words and terms of similar meaning. Novocure’s performance and financial results could differ materially from those reflected in these forward-looking statements due to general financial, economic, environmental, regulatory and political conditions and other more specific risks and uncertainties facing Novocure such as those set forth in its Annual Report on Form 10-K filed on February 22, 2024, and subsequent filings with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, any or all of these forward-looking statements may prove to be incorrect. Therefore, you should not rely on any such factors or forward-looking statements. Furthermore, Novocure does not intend to update publicly any forward-looking statement, except as required by law. Any forward-looking statements herein speak only as of the date hereof. The Private Securities Litigation Reform Act of 1995 permits this discussion.

NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)
	Three months ended June 30,								Six months ended June 30,								Year ended December 31,
	2024				2023				2024				2023				2023
	Unaudited								Unaudited								Audited
Net revenues	$	150,356			$	126,051			$	288,859			$	248,233			$	509,338
Cost of revenues		34,654				34,018				68,343				63,632				128,280
Gross profit		115,702				92,033				220,516				184,601				381,058
Operating costs and expenses:
Research, development and clinical studies		54,955				55,427				106,553				115,131				223,062
Sales and marketing		56,616				58,488				111,822				109,657				226,809
General and administrative		37,711				40,778				77,241				82,722				164,057
Total operating costs and expenses		149,282				154,693				295,616				307,510				613,928
Operating income (loss)		(33,580	)			(62,660	)			(75,100	)			(122,909	)			(232,870	)
Financial income (expenses), net		10,851				8,756				20,729				17,925				41,130
Income (loss) before income tax		(22,729	)			(53,904	)			(54,371	)			(104,984	)			(191,740	)
Income tax		10,646				3,514				17,764				5,495				15,303
Net income (loss)	$	(33,375	)		$	(57,418	)		$	(72,135	)		$	(110,479	)		$	(207,043	)
Basic and diluted net income (loss) per ordinary share	$	(0.31	)		$	(0.54	)		$	(0.67	)		$	(1.04	)		$	(1.95	)
Weighted average number of ordinary shares used in computing basic and diluted net income (loss) per share		107,700,284				106,289,073				107,483,241				105,979,791				106,391,178

Consolidated Balance Sheets
USD in thousands (except share data)
NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share data)
	June 30, 2024			December 31, 2023
	Unaudited			Audited
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	164,796		$	240,821
Short-term investments		786,390			669,795
Restricted cash		3,647			1,743
Trade receivables, net		64,703			61,221
Receivables and prepaid expenses		32,858			22,677
Inventories		40,442			38,152
Total current assets		1,092,836			1,034,409
LONG-TERM ASSETS:
Property and equipment, net		66,477			51,479
Field equipment, net		11,719			11,384
Right-of-use assets		29,076			34,835
Other long-term assets		12,062			14,022
Total long-term assets		119,334			111,720
TOTAL ASSETS	$	1,212,170		$	1,146,129

Consolidated Balance Sheets
USD in thousands (except share data)
	June 30, 2024				December 31, 2023
	Unaudited				Audited
The accompanying notes are an integral part of these unaudited consolidated financial statements.
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables	$	90,171			$	94,391
Other payables, lease liabilities and accrued expenses		79,007				84,724
Total current liabilities		169,178				179,115
LONG-TERM LIABILITIES:
Convertible note		556,508				568,822
Senior secured credit facility, net		96,962				—
Long-term leases		21,731				27,420
Employee benefit liabilities		6,023				8,258
Other long-term liabilities		18				18
Total long-term liabilities		681,242				604,518
TOTAL LIABILITIES		850,420				783,633
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Share capital -
Ordinary shares no par value, unlimited shares authorized; issued and outstanding: 108,013,830 shares and 107,075,754 shares at June 30, 2024 (unaudited) and December 31, 2023, respectively		—				—
Additional paid-in capital		1,422,903				1,353,468
Accumulated other comprehensive income (loss)		(3,515	)			(5,469	)
Retained earnings (accumulated deficit)		(1,057,638	)			(985,503	)
TOTAL SHAREHOLDERS' EQUITY		361,750				362,496
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	1,212,170			$	1,146,129

Non-U.S. GAAP financial measures reconciliation
USD in thousands
	Three months ended June 30,											Six months ended June 30,
	2024				2023				% Change			2024				2023				% Change
Net income (loss)	$	(33,375	)		$	(57,418	)		(42	)%		$	(72,135	)		$	(110,479	)		(35	)%
Add: Income tax		10,646				3,514			203	%			17,764				5,495			223	%
Add: Financial expenses (income), net		(10,851	)			(8,756	)		24	%			(20,729	)			(17,925	)		16	%
Add: Depreciation and amortization		2,858				2,721			5	%			5,673				5,443			4	%
EBITDA	$	(30,722	)		$	(59,939	)		(49	)%		$	(69,427	)		$	(117,466	)		(41	)%
Add: Share-based compensation		31,830				32,740			(3	)%			65,914				71,824			(8	)%
Adjusted EBITDA	$	1,108			$	(27,199	)		(104	)%		$	(3,513	)		$	(45,642	)		(92	)%

 

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Investors & Media:

Ingrid Goldberg

investorinfo@novocure.com

media@novocure.com

Source: Novocure

FAQ

What were Novocure's (NVCR) Q2 2024 revenue and growth rate?

Novocure reported Q2 2024 net revenues of $150.4 million, representing a 19% increase compared to the same period in 2023.

How many active patients did Novocure (NVCR) have as of June 30, 2024?

As of June 30, 2024, Novocure had 3,963 active patients on therapy, an increase of 11% compared to the same period in 2023.

What were the results of Novocure's (NVCR) Phase 3 METIS trial presented at ASCO 2024?

The METIS trial met its primary endpoint, demonstrating a statistically significant improvement in time to intracranial progression for adult patients with brain metastases from non-small cell lung cancer treated with TTFields therapy and supportive care compared to supportive care alone.

What is Novocure's (NVCR) cash position as of Q2 2024?

Novocure reported cash, cash equivalents, and short-term investments of $951.2 million as of June 30, 2024.

When does Novocure (NVCR) expect top-line data from the PANOVA-3 clinical trial?

Novocure anticipates top-line data from the phase 3 PANOVA-3 clinical trial in locally advanced pancreatic cancer in Q4 2024.