PTC Therapeutics Provides Corporate Update and Reports Fourth Quarter and Full Year 2023 Financial Results
- 34% year-over-year growth in total revenue for 2023
- Strong revenue performance in the fourth quarter of 2023
- Anticipated clinical and regulatory milestones in 2024
- Focus on potential billion-dollar opportunities in various programs
- Positive revenue growth in key products like Translarna and Emflaza
- Increase in royalty revenue from Roche's Evrysdi sales
- Strategic portfolio prioritization leading to intangible asset impairment
- Decrease in R&D expenses for the fourth quarter of 2023
- Anticipated total revenues for full year 2024 between $600 million and $680 million
- Loss on extinguishment of debt in the fourth quarter and full year 2023
- Net loss of $626.6 million for full year 2023
- Increase in GAAP R&D and SG&A expenses for full year 2024
- Intangible asset impairment of $217.8 million in 2023
- Challenges in R&D expenses and losses
Insights
The reported 34% year-over-year growth in total revenue for PTC Therapeutics indicates a robust performance, particularly in the context of the biopharmaceutical sector where revenue streams are highly dependent on product uptake and market expansion. The increase in net product revenue, particularly from the DMD franchise and drugs like Translarna and Emflaza, suggests successful commercial strategies and market penetration. The milestone achievement with Evrysdi, generating a significant collaboration revenue, reflects the strategic partnerships' importance in biopharmaceutical growth and revenue diversification.
Looking ahead, the anticipated filings for sepiapterin and vatiquinone, along with the BLA submission for Upstaza, represent potential catalysts for future revenue growth. However, the wide guidance range for 2024 total revenue indicates uncertainty, possibly due to the unpredictable nature of regulatory approvals and market dynamics. Investors should note the planned increase in R&D and SG&A expenses, which might pressure profit margins despite increased revenues. The company's cash position appears strengthened, which is crucial for funding ongoing clinical trials and potential commercial launches.
PTC Therapeutics' growth trajectory is underscored by its strong revenue performance and the expansion of its commercial portfolio. The successful geographic expansion of Translarna and Emflaza indicates a well-executed market strategy. However, it is important to consider the competitive landscape of the rare disease market and the entry barriers for new treatments. The company's focus on differentiated R&D programs suggests a strategic narrowing of focus, which could be a response to market demands and the need for innovation in treatment for rare diseases like PKU and Friedreich ataxia.
Investors should consider the potential market size for sepiapterin and vatiquinone, as the designation of 'potential billion-dollar opportunity' for sepiapterin treatment of PKU by the CEO suggests significant commercial expectations. The upcoming interim data update for the PIVOT-HD trial and topline data for the CardinALS trial will be critical in assessing the company's mid-term pipeline potential and its ability to sustain long-term growth.
The clinical and regulatory milestones outlined by PTC Therapeutics have important implications for the company's future. The progression of sepiapterin for PKU treatment towards regulatory submission is noteworthy, as PKU is a rare metabolic disorder that can lead to severe neurological complications if untreated. The potential NDA submission for vatiquinone targets Friedreich ataxia, a rare genetic disease with limited treatment options, which could position PTC as a key player in this therapeutic area if successful.
The strategic prioritization of the R&D portfolio, reflected in the discontinuation of certain gene therapy programs, suggests a refocusing of resources on the most promising assets. While this can streamline operations and reduce costs, it also carries the risk of opportunity loss if discontinued programs had future potential. The reported R&D expenses, including the success-based milestone payment for sepiapterin, indicate significant investment in advancing the clinical pipeline, which is critical for long-term success but may also affect short-term financials.
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– Global filings of sepiapterin remain on track with first submission of the EU MAA expected in March –
– Potential NDA submission for vatiquinone for Friedreich ataxia expected in late 2024 –
"We closed out 2023 with strong revenue performance in the fourth quarter," said Matthew Klein, M.D., Chief Executive Officer, PTC Therapeutics, Inc. "We are well-positioned for a successful 2024 with several potential exciting clinical and regulatory milestones ahead. We look forward to initiating the global regulatory submissions for sepiapterin for the treatment of PKU, which we see as a potential billion-dollar opportunity, as well as to advancing our PTC518, vatiquinone, and utreloxastat programs."
Key Corporate Updates:
- 2023 total revenue of
$938 million 34% year-over-year growth - 2023 revenue for the DMD franchise was
$611 million - Translarna™ (ataluren) net product revenue was
$356 million - Emflaza® (deflazacort) net product revenue was
$255 million
- Translarna™ (ataluren) net product revenue was
Key Clinical and Regulatory Milestones:
- PTC expects to submit an MAA to the EMA for sepiapterin for the treatment of PKU in March 2024 and expects to submit an NDA to the FDA for sepiapterin no later than the third quarter of 2024.
- PTC had a Type C meeting with the FDA in the first quarter of 2024 to discuss the vatiquinone Friedreich ataxia program. Based on discussions with the FDA, PTC has a potential path to an NDA submission in late 2024 based on the placebo-controlled results of MOVE-FA, along with data from the ongoing open-label extension study.
- PTC expects to submit a BLA to the FDA for Upstaza™ for the treatment of AADC deficiency in March 2024.
- PTC expects to meet with the FDA to discuss a potential NDA resubmission of Translarna in March 2024.
- PTC expects to provide an interim data update for the PIVOT-HD trial of PTC518 for Huntington's disease patients in the second quarter of 2024. This update will include 12-month data on the initial group of subjects for which data was reported in June 2023.
- PTC expects to report topline data for the CardinALS trial of utreloxastat for ALS in the fourth quarter of 2024.
Fourth Quarter and Full Year 2023 Financial Highlights:
- Total revenue was
$307.1 million $167.4 million $937.8 million $698.8 million - Total revenue included net product revenue across the commercial portfolio of
$155.1 million $661.2 million $127.5 million $535.2 million $152.0 million $276.6 million $39.9 million $163.6 million - Translarna net product revenue was
$75.2 million $55.8 million $355.8 million $288.6 million - Emflaza net product revenue was
$67.4 million $58.1 million $255.1 million $218.3 million - Roche reported Evrysdi® full year 2023 sales of approximately
CHF 1,419 million , resulting in full year 2023 royalty revenue of$168.9 million $113.5 million $100.0 million $1.5 billion - Based on
U.S. GAAP (Generally Accepted Accounting Principles), GAAP R&D expense was$121.4 million $188.7 million $666.6 million $651.5 million $30.0 million - Non-GAAP R&D expense was
$113.2 million $8.1 million $174.7 million $14.0 million $613.6 million $52.9 million $595.6 million $55.9 million - GAAP SG&A expense was
$76.3 million $92.7 million $332.5 million $326.0 million - Non-GAAP SG&A expense was
$67.9 million $8.4 million $79.3 million $13.4 million $283.8 million $48.7 million $271.5 million $54.5 million - The intangible asset impairment was
$217.8 million $33.4 million - The change in the fair value of deferred and contingent consideration was a gain of
$2.7 million $6.3 million $127.7 million $25.9 million $0 - The loss on extinguishment of debt was
$137.6 million $0.0 million $92.7 million $44.9 million - The net loss was
$155.8 million $170.9 million $626.6 million $559.0 million - Cash, cash equivalents, and marketable securities was
$876.7 million $410.7 million - Shares issued and outstanding as of December 31, 2023, were 75,708,889.
PTC Updates Full Year 2024 Financial Guidance:
- PTC anticipates total revenues for full year 2024 to be between
$600 million $680 million - PTC anticipates GAAP R&D and SG&A expense for full year 2024 to be between
$740 million $835 million - PTC anticipates Non-GAAP R&D and SG&A expense for full year 2024 to be between
$660 million $755 million $65 million $80 million - PTC anticipates up to
$90 million $65 million
Non-GAAP Financial Measures:
In this press release, the financial results of PTC are provided in accordance with GAAP and using certain non-GAAP financial measures. In particular, the non-GAAP R&D and SG&A expense financial measures exclude non-cash, stock-based compensation expense. These non-GAAP financial measures are provided as a complement to financial measures reported in GAAP because management uses these non-GAAP financial measures when assessing and identifying operational trends. In management's opinion, these non-GAAP financial measures are useful to investors and other users of PTC's financial statements by providing greater transparency into the historical and projected operating performance of PTC and the company's future outlook. Non-GAAP financial measures are not an alternative for financial measures prepared in accordance with GAAP. Quantitative reconciliations of the non-GAAP financial measures to their respective closest equivalent GAAP financial measures are included in the table below.
PTC Therapeutics, Inc. | |||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||
Revenues: | |||||||||||
Net product revenue | $ | 155,062 | $ | 127,508 | $ | 661,249 | $ | 535,228 | |||
Collaboration revenue | 100,024 | 28 | 100,030 | 50,052 | |||||||
Royalty revenue | 50,999 | 39,876 | 168,856 | 113,521 | |||||||
Manufacturing revenue | 971 | - | 7,687 | - | |||||||
Total revenues | 307,056 | 167,412 | 937,822 | 698,801 | |||||||
Operating expenses: | |||||||||||
Cost of product sales, excluding amortization of acquired intangible assets | 29,118 | 10,893 | 65,486 | 44,678 | |||||||
Amortization of acquired intangible asset | 77,174 | 35,764 | 222,635 | 116,554 | |||||||
Research and development (1) | 121,353 | 188,694 | 666,563 | 651,496 | |||||||
Selling, general and administrative (2) | 76,291 | 92,718 | 332,540 | 325,998 | |||||||
Change in the fair value of deferred and contingent consideration | (2,700) | 6,300 | (127,700) | (25,900) | |||||||
Intangible asset impairment | - | 33,384 | 217,800 | 33,384 | |||||||
Total operating expenses | 301,236 | 367,753 | 1,377,324 | 1,146,210 | |||||||
Income (loss) from operations | 5,820 | (200,341) | (439,502) | (447,409) | |||||||
Interest expense, net | (44,274) | (24,500) | (129,180) | (90,871) | |||||||
Other income (expense), net | 18,961 | 35,147 | 10,130 | (49,207) | |||||||
Loss on extinguishment of debt | (137,558) | - | (137,558) | - | |||||||
Loss before income tax benefit | (157,051) | (189,694) | (696,110) | (587,487) | |||||||
Income tax benefit | 1,259 | 18,805 | 69,506 | 28,470 | |||||||
Net loss attributable to common stockholders | $ | (155,792) | $ | (170,889) | $ | (626,604) | $ | (559,017) | |||
Weighted-average shares outstanding: | |||||||||||
Basic and diluted (in shares) | 75,490,569 | 72,656,790 | 74,838,392 | 71,728,634 | |||||||
Net loss per share—basic and diluted (in dollars per share) | $ | (2.06) | $ | (2.35) | $ | (8.37) | $ | (7.79) | |||
(1) Research and development reconciliation | |||||||||||
GAAP research and development | $ | 121,353 | $ | 188,694 | $ | 666,563 | $ | 651,496 | |||
Less: share-based compensation expense | 8,113 | 13,973 | 52,941 | 55,869 | |||||||
Non-GAAP research and development | $ | 113,240 | $ | 174,721 | $ | 613,622 | $ | 595,627 | |||
(2) Selling, general and administrative reconciliation | |||||||||||
GAAP selling, general and administrative | $ | 76,291 | $ | 92,718 | $ | 332,540 | $ | 325,998 | |||
Less: share-based compensation expense | 8,395 | 13,370 | 48,695 | 54,464 | |||||||
Non-GAAP selling, general and administrative | $ | 67,896 | $ | 79,348 | $ | 283,845 | $ | 271,534 | |||
PTC Therapeutics, Inc. | |||||
December 31, 2023 | December 31, 2022 | ||||
Cash, cash equivalents and marketable securities | $ | 876,739 | $ | 410,705 | |
Total Assets | $ | 1,895,698 | $ | 1,705,619 | |
Total debt | $ | 284,213 | $ | 571,722 | |
Total deferred revenue | 801 | 1,351 | |||
Total liability for sale of future royalties | 1,814,097 | 757,886 | |||
Total liabilities | $ | 2,714,253 | $ | 2,052,705 | |
Total stockholders' deficit (75,708,889 and 73,104,692 common shares issued and | $ | (818,555) | $ | (347,086) | |
Total liabilities and stockholders' deficit | $ | 1,895,698 | $ | 1,705,619 | |
PTC Therapeutics, Inc. (in millions) | ||
PTC Therapeutics, Inc. | ||
Reconciliation of GAAP | ||
Milestone Payments | ||
Full Year 2024 | ||
(in millions) | ||
Projected GAAP R&D Expense Related Milestone Payments | $ | 65 |
Projected GAAP Contingent Consideration Payable Related Milestone Payments | 25 | |
Total Projected GAAP Milestone Payments | $ | 90 |
PTC Therapeutics, Inc. Reconciliation of GAAP to Non-GAAP Projected Full Year 2024 R&D and SG&A Expense | |||||
Low End of Range | High End of Range | ||||
Projected GAAP R&D and SG&A Expense | $ | 740 | $ | 835 | |
Less: projected non-cash, stock-based compensation expense | 80 | 80 | |||
Projected non-GAAP R&D and SG&A expense | $ | 660 | $ | 755 | |
Acronyms:
AS: Angelman Syndrome
BLA: Biologics License Application
CHF: Confoederatio Helvetica Francs (Swiss francs)
DMD: Duchenne Muscular Dystrophy
FA: Friedreich Ataxia
FDA:
GAAP: Generally Accepted Accounting Principles
HD: Huntington's Disease
NDA: New Drug Application
PKU: Phenylketonuria
R&D: Research and Development
SG&A: Selling, General and Administrative
Today's Conference Call and Webcast Reminder:
To access the call by phone, please click here to register and you will be provided with dial-in details. To avoid delays, we recommend participants dial in to the conference call 15 minutes prior to the start of the call. The webcast conference call can be accessed on the Investor section of the PTC website at https://ir.ptcbio.com/events-presentations. A replay of the call will be available approximately two hours after completion of the call and will be archived on the company's website for 30 days following the call.
About PTC Therapeutics, Inc.
PTC is a global biopharmaceutical company focused on the discovery, development and commercialization of clinically differentiated medicines that provide benefits to patients with rare disorders. PTC's ability to globally commercialize products is the foundation that drives investment in a robust and diversified pipeline of transformative medicines and our mission to provide access to best-in-class treatments for patients who have an unmet medical need. The company's strategy is to leverage its strong scientific expertise and global commercial infrastructure to maximize value for its patients and other stakeholders. To learn more about PTC, please visit us at www.ptcbio.com and follow us on Facebook, on Twitter at @PTCBio, and on LinkedIn.
For More Information:
Investors:
Kylie O'Keefe
+1 (908) 300-0691
kokeefe@ptcbio.com
Media:
Jeanine Clemente
+1 (908) 912-9406
jclemente@ptcbio.com
Forward-Looking Statements:
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. All statements contained in this release, other than statements of historic fact, are forward-looking statements, including the information provided under the heading "PTC Updates Full Year 2024 Revenue Guidance", including with respect to (i) 2024 total revenue guidance, (ii) 2024 GAAP and non-GAAP R&D and SG&A expense guidance and (iii) 2024 acquisition related milestone payment guidance, and statements regarding: the future expectations, plans and prospects for PTC, including with respect to the expected timing of clinical trials and studies, availability of data, regulatory submissions and responses, commercialization and other matters with respect to its products and product candidates; PTC's strategy, future operations, future financial position, future revenues, projected costs; the extent, timing and financial aspects of our strategic pipeline prioritization and reductions in workforce; and the objectives of management. Other forward-looking statements may be identified by the words, "guidance", "plan," "anticipate," "believe," "estimate," "expect," "intend," "may," "target," "potential," "will," "would," "could," "should," "continue," and similar expressions.
PTC's actual results, performance or achievements could differ materially from those expressed or implied by forward-looking statements it makes as a result of a variety of risks and uncertainties, including those related to: the outcome of pricing, coverage and reimbursement negotiations with third party payors for PTC's products or product candidates that PTC commercializes or may commercialize in the future; PTC's ability to maintain its marketing authorization of Translarna for the treatment of nmDMD in
As with any pharmaceutical under development, there are significant risks in the development, regulatory approval and commercialization of new products. There are no guarantees that any product will receive or maintain regulatory approval in any territory, or prove to be commercially successful, including Translarna, Emflaza, Upstaza, Evrysdi, Tegsedi or Waylivra.
The forward-looking statements contained herein represent PTC's views only as of the date of this press release and PTC does not undertake or plan to update or revise any such forward-looking statements to reflect actual results or changes in plans, prospects, assumptions, estimates or projections, or other circumstances occurring after the date of this press release except as required by law.
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SOURCE PTC Therapeutics, Inc.
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