WOODCLIFF LAKE, N.J., March 13, 2023 (GLOBE NEWSWIRE) — Eagle Pharmaceuticals, Inc. (Nasdaq: EGRX) today announced financial results for the three and 12 months ended December 31, 2022.
Business and Recent Highlights:
- Received approval from the U.S. Food and Drug Administration (“FDA”) for an additional indication for PEMFEXY® (pemetrexed injection) in combination with pembrolizumab and platinum chemotherapy for the initial treatment of patients with metastatic, non-squamous, non-small cell lung cancer (“NSCLC”) with no EGFR or ALK genomic tumor aberrations. Eagle’s approved PEMFEXY (pemetrexed injection) is a ready-to-dilute (“RTD”) novel liquid intravenous formulation developed to eliminate the reconstitution step of the Listed Drug (“LD”), ALIMTA®.
- Bought down future royalties on PEMFEXY profits through a one-time payment of $15 million to eliminate the royalty on the first $85 million of profit beginning October 1, 2022, and to reduce the royalty thereafter.
- During the fourth quarter of 2022, the Company reached the contractual limit for royalties paid to development partner on worldwide bendamustine profits.
- Reached a settlement agreement with Accord Healthcare, Inc. (“Accord”). Eagle had asserted its Orange Book-listed patents against Accord related to Accord’s new drug application (“NDA”) referencing BENDEKA®. The settlement agreement provides that Accord has the right to market its product beginning January 17, 2028, or earlier based on certain circumstances. The settlement agreement is confidential and subject to review by the U.S. Federal Trade Commission and the U.S. Department of Justice.
- FDA accepted the Company’s investigational new drug (“IND”) application for CAL02, a novel first-in-class broad-spectrum anti-virulence agent for the adjunct treatment of severe community-acquired bacterial pneumonia (“SCABP”). The Phase 2 study is expected to begin enrollment of approximately 276 patients with severe community-acquired pneumonia at approximately 120 sites worldwide in early 2023.
- With Enalare Therapeutics Inc. (“Enalare”), announced that the FDA granted Orphan Drug Designation (“ODD”) for the treatment of Apnea of Prematurity (“AoP”) to ENA-001, a new chemical entity with a novel mechanism of action as a respiratory stimulant. Enalare’s lead compound, ENA-001 is an investigational, one-of-a-kind NCE being developed as an agnostic respiratory stimulant for multiple patient populations experiencing acute respiratory depression. In August 2022, Eagle acquired a 17% equity stake in Enalare, with an option to purchase the remaining shares of Enalare upon achievement of specified milestones, presenting the potential to add to Eagle’s portfolio novel NCEs with strong intellectual property protection, from the mid-2030s into the 2040s, including composition of matter patents.
- Hosted Investor Day including in-depth discussions of pipeline products, newly acquired acute care products, and perspectives from Key Opinion Leaders in each clinical area.
Financial Highlights
Fourth Quarter 2022
- Total revenue for Q4 2022 was $60.7 million, compared to $42.3 million in Q4 2021.
- Q4 2022 net income was $8.2 million, or $0.63 per basic and $0.62 per diluted share, compared to net loss of $(6.2) million, or $(0.48) per basic and diluted share, in Q4 2021.
- Q4 2022 adjusted non-GAAP net income was $14.4 million, or $1.11 per basic and $1.10 per diluted share, compared to adjusted non-GAAP net income of $11.0 million, or $0.85 per basic and $0.83 per diluted share, in Q4 2021. 1
- Cash and cash equivalents were $55.3 million, net accounts receivable was $72.4 million, and total debt was $63.8 million, as of December 31, 2022.
Full Year 2022
- Total revenue for the 12 months ended December 31, 2022 was $316.6 million, compared to $171.5 million, in 2021, an increase of 84.6%.
- Net income for the 12 months ended December 31, 2022 was $35.6 million, or $2.76 per basic and $2.73 per diluted share, compared to net loss of $(8.6) million, or $(0.66) per basic and diluted share, in 2021.
- Adjusted non-GAAP net income for the 12 months ended December 31, 2022 was $101.8 million, or $7.87 per basic and $7.79 per diluted share, compared to $22.3 million, or $1.71 per basic and $1.68 per diluted share, in 2021.1
- From August 2016 through December 31, 2022, Eagle has repurchased $246.1 million of its common stock through its Share Repurchase Program.
“2022 was an outstanding year for Eagle, as we tripled our adjusted non-GAAP net income per diluted share over 2021. This is a significant achievement for a company of our size, and I am pleased that we accomplished this almost entirely through organic growth. During the final three months of 2022, we recorded $12 million of Pemfexy net sales and exited the quarter with a 6% U.S. market share in community oncology. We anticipate doubling this share to approximately 12% leaving the first quarter of 2023, and have already captured a 10% share through February2,” stated Scott Tarriff, President and Chief Executive Officer of Eagle Pharmaceuticals.
“Looking ahead, we anticipate growth in Barhemsys and Byfavo over time now that our sales force is scaled to plan and trained. We intend to continue to manage our U.S. bendamustine franchise, support Enalare’s development of ENA-001, and advance our pipeline programs for CAL02 and landiolol. We believe our strong cash position and balance sheet provide us with the flexibility not only to support our clinical development work but also to seek a meaningful acquisition that could potentially go a long way in solidifying Eagle’s position as a diversified pharmaceutical company,” concluded Tarriff.
Fourth Quarter 2022 Financial Results
Total revenue for the three months ended December 31, 2022 was $60.7 million, as compared to $42.3 million for the three months ended December 31, 2021.
Q4 2022 RYANODEX® net product sales were $7.2 million, compared to $6.1 million in the fourth quarter of 2021.
Q4 2022 BELRAPZO net product sales were $11.0 million, compared to $5.5 million in the fourth quarter of 2021.
Q4 2022 PEMFEXY® net product sales were $12.1 million and vasopressin net product sales were $3.6 million.
A summary of total revenue is outlined below:
| Three Months Ended December 31, | ||||||
| 2022 | 2021 | |||||
| (unaudited) | (unaudited) | |||||
| Revenue (in thousands): | ||||||
| Product sales, net | $ | 37,161 | $ | 16,158 | ||
| Royalty revenue | 23,538 | 26,162 | ||||
| Total revenue | $ | 60,699 | $ | 42,320 | ||
Q4 2022 royalty revenue was $23.5 million, compared to $26.2 million in the prior year quarter. Full-year 2022 royalty revenue totaled $98.3 million compared to $106.5 million in 2021.
During the first quarter of 2023, Eagle provided notice to customers and the FDA that the Company is withdrawing from the vasopressin market; inventory is expected to be depleted by the end of the second quarter of 2023.
Gross margin was 67% during the fourth quarter of 2022, compared to 71% in the fourth quarter of 2021. The decrease in gross margin was driven by a change in the revenue mix, including the launch of PEMFEXY and vasopressin and amortization expense related to PEMFEXY, BARHEMSYS and BYFAVO.
R&D expense was $7.2 million for the fourth quarter of 2022, compared to $3.8 million for the fourth quarter of 2021. The increase was primarily due to higher spend of $3.9 million on CAL02.
SG&A expenses in the fourth quarter of 2022 totaled $24.2 million, compared to $20.3 million in the fourth quarter of 2021. This increase was primarily related to increased sales and marketing expense including headcount costs of $1.7 million and marketing costs of 2.1 million associated with BARHEMSYS, BYFAVO and PEMFEXY.
Net income for the fourth quarter of 2022 was $8.2 million, or $0.63 per basic and $0.62 per diluted share, compared to net loss of $(6.2) million, or $(0.48) per basic and diluted share, in the fourth quarter of 2021, primarily as a result of the factors discussed above.
Adjusted non-GAAP net income for the fourth quarter of 2022 was $14.4 million, or $1.11 per basic and $1.10 per diluted share, compared to adjusted non-GAAP net income1 of $11.0 million, or $0.85 per basic and $0.83 per diluted share, in the fourth quarter of 2021.
Full Year 2022 Financial Results
Total revenue for the year ended December 31, 2022 was $316.6 million, as compared to $171.5 million for the year ended December 31, 2021. A summary of total revenue is outlined below:
| Twelve Months Ended December 31, | ||||||
| 2022 | 2021 | |||||
| Revenue (in thousands): | ||||||
| Product sales, net | $ | 214,536 | $ | 65,023 | ||
| Royalty revenue | 98,266 | 106,523 | ||||
| License and other revenue | 3,808 | — | ||||
| Total revenue | $ | 316,610 | $ | 171,546 | ||
Net revenues increased by $145.1 million to $316.6 million in the year ended December 31, 2022 compared to $171.5 million in 2021, primarily driven by the launches of PEMFEXY and vasopressin, increases in product sales of BELRAPZO of $9.9 million and Ryanodex of $4.9 million, the acquisition of BARHEMSYS and BYFAVO, and increases in TREAKISYM royalties of $4.1 million, partially offset by a decrease in royalties of BENDEKA of $12.3 million. During 2022, we recorded $3.8 million of other revenue for a cumulative sales milestone on sales of TREAKISYM in Japan by our marketing partner, SymBio.
Gross margin was 70% for the full year 2022, as compared to 75% for 2021. The decrease in gross margin was driven by a change in the revenue mix, including the launch of PEMFEXY and vasopressin and amortization expense related to PEMFEXY, BARHEMSYS and BYFAVO.
R&D expense decreased to $34.1 million in 2022, compared to $51.3 million in 2021, primarily reflecting the non-recurrence of a $10.0 million upfront payment related to our license agreement with Combioxin SA for CAL02, a $5.0 million upfront payment related to our licensing agreement with AOP Orphan for landiolol, lower headcount cost of $1.3 million, lower spend of vasopressin of $7.6 million, RYANODEX and EA111 of $3.1 million and PEMFEXY of $2.2 million. This was partially offset by $11.0 million of CMC and clinical expenses on our CAL02 program.
Excluding stock-based compensation and other non-cash items, adjusted non-GAAP R&D expense1 for 2022 was $31.5 million.
SG&A expenses increased by $31.3 million to $106.6 million in 2022, compared to $75.3 million in 2021. The increase primarily reflects $16.6 million of higher professional fees which primarily resulted from our Acacia Pharma Group plc (“Acacia”) and Enalare transactions, $6.9 million of severance related to the acquisition of Acacia, and increased sales and marketing expense which includes increased headcount costs of $3.8 million and increased marketing costs of 5.9 million associated with BARHEMSYS, BYFAVO and PEMFEXY. This was partially offset by $2.9 million of lower stock-based compensation expense.
Net income for the year ended December 31, 2022 was $35.6 million, or $2.76 per basic and $2.73 per diluted share, as compared to net loss of $(8.6) million or $(0.66) per basic and diluted share for the year ended December 31, 2021, as a result of the factors discussed above.
Adjusted non-GAAP net income for the year ended December 31, 2022 was $101.8 million, or $7.87 per basic and $7.79 per diluted share, compared to adjusted non-GAAP net income1 of $22.3 million, or $1.71 per basic and $1.68 per diluted share, for 2021.1
2023 Guidance
- Adjusted EBITDA of $74.0-$80.0 million1
- Adjusted non-GAAP earnings per share of $4.20-$4.531
- Adjusted non-GAAP R&D expense of $41.0-$45.0 million1
- Adjusted non-GAAP SG&A expense of $86.0-$90.0 million1
Liquidity
As of December 31, 2022, Eagle had $55.3 million in cash and cash equivalents, $72.4 million in accounts receivable, net, and $63.8 million in outstanding debt on the Company’s $150 million credit facility with JPMorgan. Therefore, as of December 31, 2022, Eagle had cash and cash equivalents plus accounts receivables, net of $127.7 million.
In 2022, Eagle repurchased $18.0 million of its common stock as part of its Share Repurchase Program. From August 2016 through December 31, 2022, Eagle has repurchased $246.1 million of its common stock.
About Eagle Pharmaceuticals, Inc.
Eagle is a fully integrated pharmaceutical company with research and development, clinical, manufacturing and commercial expertise. Eagle is committed to developing innovative medicines that result in meaningful improvements in patients’ lives. Eagle’s commercialized products include vasopressin, PEMFEXY®, RYANODEX®, BENDEKA®, BELRAPZO®, TREAKISYM® (Japan), and BYFAVO® and BARHEMSYS® through its wholly owned subsidiary Acacia Pharma Inc. Eagle’s oncology and CNS/metabolic critical care pipeline includes product candidates with the potential to address underserved therapeutic areas across multiple disease states. Additional information is available on Eagle’s website at www.eagleus.com.
