Pharming Group reports financial results for the first quarter of 2022

Revenues increased 7% yoy to $46.6 million

Leniolisib launch on track for Q1 2023 following previously announced positive pivotal data

Strong cash flow from operations supporting investments in leniolisib

LEIDEN, Netherlands, May 12, 2022 /PRNewswire/ — Pharming Group N.V. (“Pharming” or “the Company”) (EURONEXT Amsterdam: PHARM) (Nasdaq: PHAR) presents its (unaudited) financial report for the first quarter of the year ended 31 March 2022.

Pharming Group N.V. logo

 

  • The Company will hold an analyst conference call at 13.30 CET/07.30 EST today. Dial in details can be found below

Financial Summary

Amounts in US $m except per share data

Q1 2022

Q1 2021

% change

Consolidated Income Statement

Revenues

46.6

43.6

7%

Gross profit

41.7

38.7

8%

Operating profit

2.8

6.3

(55)%

Finance result, net

1.8

6.6

(72)%

Income tax expense

-0.8

-4.3

(82)%

Net Profit

3.5

8.5

(59)%

Consolidated Balance Sheet

Cash & marketable securities (Including restricted cash)

190.7

208.5

(9)%

Share Information

Basic earnings per share (US$)

0.005

0.013

(62)%

Diluted earnings per share (US$)

0.005

0.013

(62)%

Financial highlights

  • Total revenues for Q1 2022 increased by 7% to US$46.6 million compared to US$43.6 million in Q1 2021.
  • Key driver of revenues growth is an increase in the number of patients treated partly offset by tighter inventory management at larger specialty pharmacies.
  • Gross profit increased by 8% to US$41.7 million (Q1 2021: US$38.7 million), mainly due to the growth in revenues.
  • Operating profit decreased to US$2.8 million (Q1 2021: US$6.3 million), mainly due to an expected increase in operating expenses from US$32.7 million in Q1 2021 to US$39.8 million in Q1 2022. This increase is a combination of launch preparation for leniolisib, increased travel expenses post-COVID-19 and phasing of costs.
  • Net profit of US$3.5 million decreased 59% (Q1 2021: US$8.5 million). The decrease was caused as a result of a significant decrease in finance income from US$6.6 million in Q1 2021 to US$1.8 million in Q1 2022, mainly due to more favorable exchange rate gains in Q1 2021. The remainder of the decrease relates to the increased operating expenses, partly offset by the growth in gross profit.
  • Positive cash flows from operations amounted to US$0.6 million in Q1 2022. Cash and cash equivalents decreased by US$2.3 million to US$189.7 million from US$191.9 million at the end of Q4 2021.

Operational highlights

  • Both co-primary endpoints met in Phase II/III pivotal clinical study of leniolisib for the treatment of PI3K delta syndrome (APDS), a rare primary immunodeficiency disease. Submission of global regulatory filings for leniolisib subsequently planned to begin in Q2 2022, with US launch expected in Q1 2023 and European launch in H2 2023, subject to regulatory approvals.
  • Positive decision received from the European Medicines Agency (EMA) and, post-period, the UK Medicines and Healthcare Products Regulatory Agency (MHRA), on the Pediatric Investigation Plan (PIP) for leniolisib as a treatment for APDS in children, which provides a regulatory pathway to market authorization in Europe and the UK, respectively. The leniolisib PIP includes two planned global clinical trials in pediatric patients with APDS. The Company expects to initiate recruitment for this pediatric program for leniolisib during the second half of 2022.

Post-period operational highlights

  • Principal Investigator V. Koneti Rao, M.D., a staff physician in the Primary Immune Deficiency Clinic at the National Institutes of Health in Bethesda, Maryland, shared findings from the pivotal Phase II/III clinical trial of leniolisib for the treatment of APDS demonstrating the reduction in APDS disease markers in patients treated with leniolisib in a presentation at the Clinical Immunology Society (CIS) 2022 Annual Meeting.
  • Granted Promising Innovative Medicine (PIM) designation for leniolisib for the treatment of ADPS from the MHRA. A PIM designation indicates that a medicinal product is a promising candidate for the MHRA’s Early Access to Medicines Scheme (EAMS), which provides pre-market access to products that are intended for the treatment, diagnosis, or prevention of a life-threatening or seriously debilitating condition and have the potential to address an unmet medical need.
  • One-off payment of US$7.5 million received following Pharming’s change in holding in BioConnection BV, the Company’s long-term fill and finish partner for RUCONEST®. Pharming retains a 22.98% holding in BioConnection following an acquisition of a majority stake in BioConnection by European investment company Gimv. Pharming continues to support BioConnection to accelerate its growth strategy together with its other shareholders.

Chief Executive Officer, Sijmen de Vries, commented:

“The first quarter of 2022 was a key moment in the Company’s history following the report of positive data for leniolisib in a pivotal study in patients with activated phosphoinositide 3-kinase delta syndrome, a complex and progressive rare primary immunodeficiency disease with limited treatment options. We therefore remain focused on bringing this important product to patients, as we continue to increase our planned pre- launch activities and expect to be able to launch leniolisib in the US, subject to regulatory approval, in Q1 2023, followed by launches in the EU markets, subject to regulatory approval, starting in H2 2023.

These activities include continuing to identify potential APDS patients eligible for treatment with leniolisib. In the US and Canada, this is through our partnership with Invitae and the navigateAPDS program, which will offer immunologists in these regions access to free genetic testing for primary immune deficiency patients exhibiting APDS symptoms. In Europe, we are intensifying our patient identification efforts together with leading immunology centers of excellence treating patients with APDS and other rare immune deficiencies. We are also actively collaborating with patient organizations to create awareness, advocacy and education for APDS patients and their families.

Our investment in leniolisib has been made possible by the underlying strength of our business, and we are pleased to report a marked increase in revenue growth for the first quarter of the year driven by ongoing new patient enrollment and product demand for RUCONEST®. This growth is despite some continued impact of COVID-19 on a number of medical practices in the US, especially pertaining to the time it takes for the administrative processing and approval of prescriptions.”

Outlook

For the remainder of 2022, the Company anticipates:

  • Single digit growth in Group revenues from RUCONEST® sales, driven by the US and expanded EU operations, subject to the progression of the COVID-19 pandemic. Quarterly fluctuations in revenues are expected.
  • The submission of leniolisib regulatory filings to FDA and EMA, with commercial launch expected from early Q1 2023 onwards, subject to regulatory approvals.
  • The company will invest in this new product opportunity to accelerate future growth. Investments in launch preparations and focused clinical development for leniolisib will significantly increase and will significantly impact profit. With continued cash flow from RUCONEST® to fund these investments, no additional financing to support the current business is expected.
  • Focused investment in potential acquisitions and in-licensing of new late-stage development opportunities and assets in rare diseases. Financing, if required, would come via a combination of our strong balance sheet and access to capital markets.
  • Continued focus on our strategic development, ensuring Pharming’s growth through developed assets and a potentially expanded pipeline of in-licensed products to provide further life-saving therapies for patients with unmet medical needs and increase returns for our shareholders.

No further specific financial guidance for 2022 is provided.

About Pharming Group N.V.

Pharming Group N.V. (EURONEXT Amsterdam: PHARM/Nasdaq: PHAR) is a global biopharmaceutical company dedicated to transforming the lives of patients with rare, debilitating, and life-threatening diseases. Pharming is commercializing and developing an innovative portfolio of protein replacement therapies and precision medicines, including small molecules, biologics, and gene therapies that are in early to late-stage development. Pharming is headquartered in Leiden, Netherlands, and has employees around the globe who serve patients in over 30 markets in North America, Europe, the Middle East, Africa, and Asia-Pacific.

For more information, visit www.pharming.com.

Forward-looking Statements

This press release contains forward-looking statements, including with respect to timing and progress of Pharming’s preclinical studies and clinical trials of its product candidates, Pharming’s clinical and commercial prospects, Pharming’s ability to overcome the challenges posed by the COVID-19 pandemic to the conduct of its business, and Pharming’s expectations regarding its projected working capital requirements and cash resources, which statements are subject to a number of risks, uncertainties and assumptions, including, but not limited to the scope, progress and expansion of Pharming’s clinical trials and ramifications for the cost thereof; and clinical, scientific, regulatory and technical developments. In light of these risks and uncertainties, and other risks and uncertainties that are described in Pharming’s 2021 Annual Report and the Annual Report on Form 20-F for the year ended December 31, 2021 filed with the U.S. Securities and Exchange Commission, the events and circumstances discussed in such forward-looking statements may not occur, and Pharming’s actual results could differ materially and adversely from those anticipated or implied thereby. Any forward-looking statements speak only as of the date of this press release and are based on information available to Pharming as of the date of this release.

Inside Information

This press release relates to the disclosure of information that qualifies, or may have qualified, as inside information within the meaning of Article 7(1) of the EU Market Abuse Regulation.

For further public information, contact:

Pharming Group, Leiden, The Netherlands
Sijmen de Vries, CEO
T: +31 71 524 7400
E: [email protected]

FTI Consulting, London, UK
Victoria Foster Mitchell/Alex Shaw/Amy Byrne
T: +44 203 727 1000

LifeSpring Life Sciences Communication, Amsterdam, The Netherlands
Leon Melens
T: +31 6 53 81 64 27
E: [email protected]

Conference call dial-in information

Thursday, 12 May 2022 13:30 CET/07:30 ET

Please note, the Company will only take questions from dial-in attendees.

Netherlands (Local)        085 888 7233
United Kingdom              0800 640 6441
United Kingdom (Local) 020 3936 2999
United States                    1 855 9796 654
United States (Local)      1 646 664 1960
All other locations          +44 20 3936 2999

Access code: 648887

Webcast Link:
https://webcast.openbriefing.com/pharming-q12022/

Pharming Group N.V.
Condensed Consolidated Interim Financial Statements in US Dollars (unaudited)
For the period ended 31 March 2022

  • Condensed consolidated statement of profit or loss
  • Condensed consolidated statement of comprehensive income
  • Condensed consolidated balance sheet
  • Condensed consolidated statement of cash flow

Condensed Consolidated Statement of Profit or Loss
For the period ended 31 March

Amounts in US$ ‘000

YTD 2022

YTD 2021

Revenues

46,617

43,564

Costs of sales

(4,877)

(4,843)

Gross profit

41,740

38,721

Other income

873

259

Research and development

(14,863)

(10,700)

General and administrative

(7,728)

(7,161)

Marketing and sales

(17,197)

(14,836)

Other Operating Costs

(39,788)

(32,697)

Operating profit

2,825

6,283

Fair value gain (loss) on revaluation derivatives

30

Other finance income

3,228

8,159

Other finance expenses

(1,379)

(1,598)

Finance result, net

1,849

6,591

Share of net profits in associates using the equity method

(441)

(82)

Profit before tax

4,233

12,792

Income tax expense

(772)

(4,269)

Profit for the year

3,461

8,523

Basic earnings per share (US$)

0.005

0.013

Diluted earnings per share (US$)

0.005

0.013

 

Condensed Consolidated Statement of Comprehensive Income
For the period ended 31 March 

Amounts in US$ ‘000

YTD 2022

YTD 2021

Profit for the year

3,461

8,523

Currency translation differences

(3,216)

(8,483)

Fair value remeasurement investments

(653)

Items that may be subsequently reclassified to profit or loss

(3,869)

(8,483)

Other comprehensive income (loss), net of tax

(3,869)

(8,483)

Total comprehensive income for the year

(408)

40

 

Condensed Consolidated Balance Sheet

Amounts in US$ ‘000

March 31, 2022

December 31, 2021

Non-current assets

Intangible assets

81,321

83,834

Property, plant and equipment

12,465

13,222

Right-of-use assets

19,432

19,943

Long-term prepayments

238

194

Deferred tax assets

20,194

21,216

Investment accounted for using the equity method

6,629

7,201

Investments in equity instruments designated as at FVTOCI

774

1,449

Restricted cash

797

812

Total non-current assets

141,850

147,871

Current assets

Inventories

29,607

27,310

Trade and other receivables

31,445

29,983

Restricted cash

222

227

Cash and cash equivalents

189,674

191,924

Total current assets

250,948

249,444

Total assets

392,798

397,315

Equity

Share capital

7,468

7,429

Share premium

457,961

455,254

Legal reserves

(910)

3,400

Accumulated deficit

(270,498)

(273,167)

Shareholders’ equity

194,021

192,916

Non-current liabilities

Convertible bonds

135,564

139,007

Lease liabilities

17,900

18,456

Other financial liabilities

162

165

Total non-current liabilities

153,626

157,628

Current liabilities

Convertible bonds

1,844

1,879

Trade and other payables

40,827

42,473

Lease liabilities

2,480

2,419

Other financial liabilities

Total current liabilities

45,151

46,771

Total equity and liabilities

392,798

397,315

 

Condensed Consolidated Statement of Cash Flow
For the three months ended 31 March

Amounts in US$’000

YTD 2022

YTD 2021

Profit before tax

4,233

12,792

Non-cash adjustments:

Depreciation, amortization, impairment of non-current assets

2,190

2,063

Equity settled share based payments

1,070

1,909

Fair value gain (loss) loss on revaluation of derivatives

(30)

Other finance income

(3,228)

(8,159)

Other finance expenses

1,379

1,598

Share of net profits in associates using the equity method

441

(82)

Other

(1,094)

Operating cash flows before changes in working capital

6,085

8,997

Changes in working capital:

Inventories

(2,297)

(608)

Trade and other receivables

(1,462)

2,961

Payables and other current liabilities

(1,645)

(4,006)

Restricted cash

(20)

(321)

Total changes in working capital

(5,424)

(1,974)

Interest received (paid)

(52)

38

Income taxes paid

Net cash flows generated from (used in) operating activities

609

7,061

Capital expenditure for property, plant and equipment

(208)

(1,956)

Investment intangible assets

(167)

(460)

Investment associate

398

Investment in equity instruments designated as at FVTOCI

Acquisition of license

(547)

Net cash flows used in investing activities

(374)

(2,565)

Payment on contingent consideration

Payment of lease liabilities

(807)

(554)

Interests on loans

(2,100)

(2,500)

Proceeds of equity and warrants

18

674

Net cash flows generated from (used in) financing activities

(2,889)

(2,380)

Increase (decrease) of cash

(2,654)

2,116

Exchange rate effects

404

(650)

Cash and cash equivalents at 1 January

191,924

205,159

Total Cash and cash equivalents at 31 March

189,674

206,625

 

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