Innoviva Reports Fourth Quarter 2018 Financial Results
-
Total net revenue rose 15% to
$79.9 million in the fourth quarter of 2018 compared with the fourth quarter of 2017.1 -
Income before income taxes increased 25% from the fourth quarter of
2017 to
$73.1 million .
-
Gross royalty revenues of
$83.3 million fromGlaxo Group Limited (“GSK”) for the fourth quarter of 2018 included royalties of$64.8 million from global net sales of RELVAR®/BREO® ELLIPTA®, royalties of$12.1 million from global net sales of ANORO® ELLIPTA® and$6.4 million from global net sales of TRELEGY® ELLIPTA®.2 -
Total operating expenses for the fourth quarter of 2018 were
$2.6 million compared with$3.1 million (including$2.9 million for insurance recovery and legal fee discount) in the fourth quarter of 2017. Total non-cash operating expenses for the fourth quarter of 2018 included$0.5 million in stock-based compensation compared to$2.4 million in stock-based compensation for the fourth quarter of 2017. -
In the fourth quarter of 2018, the Company recorded an income tax
benefit of approximately
$196.1 million related to the reversal of a valuation allowance on its deferred tax assets. This non-cash income tax benefit is non-recurring and relates primarily to$0.8 billion of U.S. federal net operating losses, and certain federal R&D credits which are expected to be utilized in the future. The Company expects to recognize income tax expense in 2019 and future periods, primarily based on the 21% federal tax rate, but it doesn’t expect to use cash to pay income taxes until after it utilizes the available deferred tax assets.
-
Net cash and cash equivalents, short-term investments and marketable
securities totaled
$114.9 million , and royalties receivable from GSK totaled$83.3 million , as ofDecember 31, 2018 .
“Global net sales of RELVAR®/BREO® ELLIPTA®
increased 7% versus the fourth quarter of 2017 –U.S. net sales decreased
2% as increased pricing discounts in the respiratory sector offset
volume growth while non-U.S. sales continued their strong growth and
increased 19% compared to 2017. Global net sales of ANORO®
ELLIPTA® grew 26% versus the fourth quarter of 2017 – U.S.
net sales increased 22% due to continued growth of the LABA/LAMA class
while non-U.S. sales were up 37%”, stated
Hulme continued, “With the efforts taken by the new board of directors
and management in 2018,
Recent Highlights
-
GSK Net Sales:
-
Fourth quarter 2018 net sales of RELVAR®/BREO®
ELLIPTA® by GSK were
$431.6 million , up 7% from$405.3 million in the fourth quarter of 2017, with$236.4 million in net sales from the U.S. market and$195.2 million from non-U.S. markets. -
Fourth quarter 2018 net sales of ANORO® ELLIPTA® by
GSK were
$186.2 million , up 26% from$147.3 million in the fourth quarter of 2017, with$125.7 million net sales from the U.S. market and$60.5 million from non-U.S. markets. -
Fourth quarter 2018 net sales of TRELEGY® ELLIPTAby
GSK were
$99.0 million with$75.8 million in net sales from the U.S. market and$23.2 million in net sales from non-U.S. markets. TRELEGY® ELLIPTA® was approved in the U.S. inSeptember 2017 .
-
Fourth quarter 2018 net sales of RELVAR®/BREO®
ELLIPTA® by GSK were
-
Product Updates:
-
In
November 2018 , theEuropean Commission authorized an expanded label of TRELEGY® ELLIPTA® (fluticasone furoate/umeclidinium/ vilanterol ‘FF/UMEC/VI’) for once daily use in patients with moderate to severe chronic obstructive pulmonary disease (COPD) not adequately treated with dual bronchodilators or with an inhaled corticosteroid (ICS) and a long-acting β2-agonist (LABA).
-
In
1 The fourth quarter of 2017 included
2 For TRELEGY ®
ELLIPTA®,
About
ANORO®, RELVAR®, BREO®, TRELEGY® and ELLIPTA® are trademarks of the GlaxoSmithKline group of companies.
Forward Looking Statements
This press release contains certain “forward-looking” statements as that
term is defined in the Private Securities Litigation Reform Act of 1995
regarding, among other things, statements relating to goals, plans,
objectives and future events.
INNOVIVA, INC. | ||||||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||
Revenue: | ||||||||||||||||||||
Royalty revenue from a related party, net | $ | 79,858 | $ | 67,084 | $ | 261,004 | $ | 214,118 | ||||||||||||
Revenue from collaborative arrangements from a related party | - | 2,436 | - | 3,099 | ||||||||||||||||
Total net revenue (1) | 79,858 | 69,520 | 261,004 | 217,217 | ||||||||||||||||
Operating expenses: | ||||||||||||||||||||
Research and development | - | 342 | - | 1,355 | ||||||||||||||||
General and administrative | 2,638 | 5,690 | 14,349 | 24,147 | ||||||||||||||||
General and administrative - proxy contest and litigation costs | - | (2,921 | ) | - | 8,111 | |||||||||||||||
General and administrative - cash severance expenses | - | - | 5,704 | - | ||||||||||||||||
General and administrative - related party | - | - | 2,700 | - | ||||||||||||||||
Total operating expenses | 2,638 | 3,111 | 22,753 | 33,613 | ||||||||||||||||
Income from operations | 77,220 | 66,409 | 238,251 | 183,604 | ||||||||||||||||
Other income (expense), net | (16 | ) | 70 | (5,702 | ) | (7,038 | ) | |||||||||||||
Interest income | 519 | 393 | 1,660 | 1,311 | ||||||||||||||||
Interest expense | (4,581 | ) | (8,354 | ) | (23,954 | ) | (43,601 | ) | ||||||||||||
Income before income taxes | 73,142 | 58,518 | 210,255 | 134,276 | ||||||||||||||||
Income tax benefit (expense), net | 196,073 | (4 | ) | 196,073 | (4 | ) | ||||||||||||||
Net income | 269,215 | 58,514 | 406,328 | 134,272 | ||||||||||||||||
Net income attributable to noncontrolling interest | 5,455 | 129 | 11,272 | 129 | ||||||||||||||||
Net income attributable to Innoviva stockholders | $ | 263,760 | $ | 58,385 | $ | 395,056 | $ | 134,143 | ||||||||||||
Basic net income per share attributable to Innoviva stockholders | $ | 2.61 | $ | 0.55 | $ | 3.92 | $ | 1.25 | ||||||||||||
Diluted net income per share attributable to Innoviva stockholders | $ | 2.34 | $ | 0.50 | $ | 3.53 | $ | 1.17 | ||||||||||||
Shares used to compute basic net income per share | 100,979 | 106,156 | 100,849 | 106,945 | ||||||||||||||||
Shares used to compute diluted net income per share | 113,299 | 119,189 | 113,408 | 119,866 | ||||||||||||||||
(1) Total net revenue is comprised of the following (in thousands): |
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||||
Royalties from a related party | $ | 83,313 | $ | 70,539 | $ | 274,827 | $ | 227,941 | ||||||||||||
Amortization of capitalized fees paid to a related party | (3,455 | ) | (3,455 | ) | (13,823 | ) | (13,823 | ) | ||||||||||||
Royalty revenue | 79,858 | 67,084 | 261,004 | 214,118 | ||||||||||||||||
Strategic alliance - MABA program license | - | 2,436 | - | 3,099 | ||||||||||||||||
Total net revenue | $ | 79,858 | $ | 69,520 | $ | 261,004 | $ | 217,217 | ||||||||||||
INNOVIVA, INC. | ||||||||||
Condensed Consolidated Balance Sheets | ||||||||||
(in thousands) | ||||||||||
December 31, | December 31, | |||||||||
2018 | 2017 | |||||||||
(unaudited) | (1) | |||||||||
Assets | ||||||||||
Cash, cash equivalents and marketable securities | $ | 114,908 | $ | 129,075 | ||||||
Other current assets | 84,135 | 71,294 | ||||||||
Property and equipment, net | 160 | 209 | ||||||||
Capitalized fees paid to a related party, net | 152,899 | 166,722 | ||||||||
Deferred tax assets | 196,054 | - | ||||||||
Other assets | 37 | 37 | ||||||||
Total assets | $ | 548,193 | $ | 367,337 | ||||||
Liabilities and stockholders’ equity (deficit) | ||||||||||
Other current liabilities | $ | 1,436 | $ | 3,822 | ||||||
Accrued interest payable | 4,264 | 5,920 | ||||||||
Convertible subordinated notes, net | 238,664 | 238,123 | ||||||||
Convertible senior notes, net | 130,734 | 124,158 | ||||||||
Senior secured term loans, net | 13,457 | 237,081 | ||||||||
Other long-term liabilities | 586 | 940 | ||||||||
Innoviva stockholders’ equity (deficit) | 153,583 | (242,859 | ) | |||||||
Noncontrolling interest | 5,469 | 152 | ||||||||
Total liabilities and stockholders’ equity (deficit) | $ | 548,193 | $ | 367,337 | ||||||
(1) The selected consolidated balance sheet amounts at December 31, 2017 are derived from audited financial statements. |
INNOVIVA, INC. | ||||||||||
Cash Flows Summary | ||||||||||
(in thousands) | ||||||||||
Year Ended | ||||||||||
December 31, | ||||||||||
2018 | 2017 | |||||||||
(unaudited) | ||||||||||
Net cash provided by operating activities | $ | 223,531 | $ | 141,749 | ||||||
Net cash provided by (used in) investing activities | 3,519 | (23,236 | ) | |||||||
Net cash used in financing activities | (237,969 | ) | (163,193 | ) | ||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190206005706/en/
Source:
Investors & Media:
Dan Zacchei /
Alex Kovtun
Sloane & Company
212-446-9500
dzacchei@sloanepr.com
/ akovtun@sloanepr.com