Formycon reports on successful operating business and financial figures for the first quarter of 2024
EQS-News: Formycon AG / Key word(s): Quarterly / Interim Statement/Quarter Results
Formycon reports on successful operating business and financial figures for the first quarter of 2024
08.05.2024 / 07:30 CET/CEST
The issuer is solely responsible for the content of this announcement.Press Release // May 8, 2024
*Formycon reports on successful operating business and financial figures for the first quarter of 2024 *
· Group revenue amounts to € 17.7 million and corresponds to plan
· Group EBITDA of € -5.5 million reflects investments in pipeline and corporate development
· Adjusted Group EBITDA of € -1.2 million shows strong at-equity result for FYB201 participation
· Gedeon Richter acquires a 9.1% stake as new strategic investor
· Working capital increases significantly to € 84.2 million including cash equivalents of € 56.9 million
· Invitation to today’s conference call at 3:00 pm (CEST)
*Planegg-Martinsried, Germany* – Formycon AG (FSE: FYB, “Formycon”) today published figures for the first quarter of financial year 2024.
Enno Spillner, CFO of Formycon AG, comments: “We have made a very good start to the new financial year in line with our plans and are positive about the first three months. In March, Sandoz announced the acquisition of the CIMERLI^® business including the Coherus ophthalmology sales team in the USA, which we very much welcome and are looking forward to working together in the future. We can also report approvals and market launches in Saudi Arabia, Canada and Switzerland and are pleased that our partners MS Pharma and Teva are providing many patients access to this treatment for serious eye diseases.
In February, we completed a cash capital increase with the specialty pharmaceutical company Gedeon Richter with gross proceeds of € 82.8 million. After many years of trustful cooperation in contract manufacturing, this strategic investment by our partner opens up opportunities to jointly exploit long-term strategic opportunities in the areas of development, manufacturing and commercial value creation. We are continuously investing in our pipeline and are well positioned to capitalize on the potential of the rapidly growing biosimilar market and expand our position as one of the few pure-play biosimilar developers.”
*Revenues are influenced by milestone payments from the FYB202 project as well as from revenue shares from FYB201 sales*
In the first quarter of 2024, the Formycon Group generated revenues of € 17.7 million (Q1/2023: € 32.4 million)[i]. These are below the previous year's figure but are in line with planning. In the previous year's quarter of 2023, an additional payment of € 10 million from the commercialization partnership with Fresenius Kabi for the FYB202 project, as well as higher income from development services for the two partnered projects FYB201 and FYB203 led to a strong revenue effect.
A significant share of revenue in the first quarter of 2024 was generated from development services for the partnered projects FYB201 and FYB203 as well as from deferred success payments related to the commercialization partnership with Fresenius Kabi from the FYB202 project. Revenue resulting from direct participation in the marketing of the Lucentis^®[1] biosimilar FYB201 amounted to around € 1.9 million (Q1/2023: € 0.3 million). A further significant part of the FYB201 revenue was realized as part of the 50% at equity investment in Bioeq AG and is therefore not shown directly in the revenue but below EBITDA.
The consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to € -5.5 million and is reflecting investments in the pipeline and further corporate development.
For the first quarter of 2024, the at equity result from the existing 50% stake in Bioeq AG amounted to € 4.3 million (Q1/2023: € -6.4 million). This underscores the overall successful operating performance of the FYB201 commercialization. The at equity result is included in the new key financial figure “Adjusted Group EBITDA”, which amounted to € -1.2 million in the first quarter of 2024 (Q1/2023: € -0.4 million).
*Strategic investment by Gedeon Richter leads to significant increase in working capital in the first quarter*
In February 2024, the Hungarian specialty pharmaceutical company Gedeon Richter Plc (“Gedeon Richter”) became a strategic investor in Formycon with a 9.1% stake as part of a cash capital increase excluding subscription rights. The rationale behind the transaction is the shared common interest in the development and production of future biosimilars and in further potential operational cooperation. Formycon issued 1,603,877 new bearer shares with a pro rata amount of the share capital of € 1.00 each against cash contribution at a placement price of € 51.65 per new share by partially utilizing the authorized capital.
Through the transaction, Formycon generated gross proceeds of € 82.8 million, which will be used primarily for the further development of the FYB206, FYB208 and FYB209 projects. In addition, the launch of FYB210, a new biosimilar candidate, is planned for the second half of the year.
Formycon's net working capital increased significantly to € 84.2 million as of March 31, 2024 (December 31, 2023: € 38.9 million). It includes cash and cash equivalents of € 56.9 million (December 31, 2023: € 27.0 million). The shareholder loan has now been repaid in full. The flexible shareholder credit line of up to € 48 million remains in place.
Formycon confirms the financial guidance issued in April for the 2024 financial year. Assuming the expected approvals and market launches as well as potential out-licensing of biosimilar candidates, Formycon is aiming for a positive EBITDA in the medium term.
*Operative milestones for FYB201 and FYB202 reached in the first quarter*
In early March, the partner for the MENA region MS Pharma received marketing authorization for FYB201 from the Saudi Food & Drug Authority and won the state NUPCO tender in Saudi Arabia. FYB201 is expected to be marketed under the trade name Ravegza^®[2] in Saudi Arabia from the second quarter of 2024. In addition, following Jordan and Saudi Arabia, market launches are also planned in Algeria and other Gulf Cooperation Council (GCC) countries in the course of 2024.
Subsequent to the end of the reporting period, the commercialization partner Teva announced the market launches of FYB201 in Canada under the trade name Ranopto^TM[3] and in Switzerland under the trade name Ranivisio^®[4].
For FYB202, the biosimilar candidate for Stelara^®[5] (ustekinumab), Formycon and its commercialization partner Fresenius Kabi have successfully concluded a settlement agreement for Europe and Canada with Johnson & Johnson. As early as August last year, it was ensured that FYB202 can be launched on the US market no later than April 15, 2025, following approval. The marketing authorization application for FYB202 was accepted for review by the European Medicines Agency (EMA) in September 2023 and by the U.S. Food and Drug Administration (FDA) in November 2023.
*Several approval decisions and the start of the next clinical program mark important milestones for the 2024 financial year*
Formycon is expecting important approval decisions for the biosimilar candidates FYB202 (ustekinumab) and FYB203 (aflibercept) in the USA and Europe in the course of 2024, which are expected to contribute to revenue growth from 2025 onwards, following the successful start of commercialization. The start of the clinical development program for FYB206, the biosimilar candidate to Keytruda^®[6] (pembrolizumab), is planned with the treatment of the first patient (first patient-in) in the course of 2024. Formycon continues to invest in the expansion of its biosimilar platform and further extended its product pipeline with the two earlier biosimilar candidates FYB208 and FYB209. In addition, the plan is to continue the expansion in 2024 with the initiation of the FYB210 project.
*Conference call and dial-in data*
The Management Board of Formycon AG will discuss the development of the company and the key financial figures for the first quarter of the financial year 2024 in a conference call. The conference call, which will be broadcasted live on the Internet *on May 8, 2024 at 3:00 p.m. (CEST)* in English.
*To participate, please register at:*
https://webcast.meetyoo.de/reg/f7ngieeBvHNo
You will then receive a confirmation e-mail with the telephone number, access code and PIN for the call.
*The presentation and audio transmission can be accessed via the following link: *
https://www.webcast-eqs.com/formycon-2024-q1
Following a short presentation, the Management Board will be available to answer analysts' questions. The conference call will be recorded and will be available afterwards on the Formycon website at: https://www.formycon.com/en/investor-relations/facts-figures/
*About Formycon:*
Formycon AG (FSE: FYB) is a leading, independent developer of high-quality biosimilars, follow-on products of biopharmaceutical medicines. The company focuses on therapies in ophthalmology, immunology, immuno-oncology and other key disease areas, covering almost the entire value chain from technical development through clinical trials to approval by the regulatory authorities. For commercialization of its biosimilars, Formycon relies on strong, well-trusted and long-term partnerships worldwide. With FYB201/Ranibizumab, Formycon already has a biosimilar on the market in Europe and the USA. Another five biosimilar candidates are currently in development. With its biosimilars, Formycon is making an important contribution to providing as many patients as possible with access to highly effective and affordable medicines. Formycon AG is headquartered in Munich and is listed on the Frankfurt Stock Exchange: FYB / ISIN: DE000A1EWVY8 / WKN: A1EWVY. Further information can be found at: https://www.formycon.com
*About Biosimilars:*
Since their introduction in the 1980s, biopharmaceutical drugs have revolutionized the treatment of serious and chronic diseases. By 2032, many of these drugs will lose their patent protection – including 45 blockbusters with an estimated total annual global turnover of more than 200 billion US dollars. Biosimilars are successor products to biopharmaceutical drugs for which market exclusivity has expired. They are approved in highly regulated markets such as the EU, the USA, Canada, Japan and Australia in accordance with strict regulatory procedures. Biosimilars create competition and thus give more patients access to biopharmaceutical therapies. At the same time, they reduce costs for healthcare providers. Global sales of biosimilars currently amount to around 21 billion US dollars. Analysts assume that sales could rise to over 74 billion US dollars by 2030.
*Contact:*
Sabrina Müller,
Director Investor Relations & Corporate Communications,
Formycon AG
Fraunhoferstr. 15
82152 Planegg-Martinsried
Germany
Tel.: +49 (0) 89 - 86 46 67 149
Fax: + 49 (0) 89 - 86 46 67 110
Sabrina.Mueller@formycon.com
*Disclaimer:*
This press release may contain forward-looking statements and information which are based on Formycon’s current expectations and certain assumptions. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, performance of the company, development of the products and the estimates given here. Such known and unknown risks and uncertainties comprise, among others, the research and development, the regulatory approval process, the timing of the actions of regulatory bodies and other governmental authorities, clinical results, changes in laws and regulations, product quality, patient safety, patent litigation, contractual risks and dependencies from third parties. With respect to pipeline products, Formycon AG does not provide any representation, warranties or any other guarantees that the products will receive the necessary regulatory approvals or that they will prove to be commercially exploitable and/or successful. Formycon AG assumes no obligation to update these forward-looking statements or to correct them in case of developments which differ from those anticipated. This document neither constitutes an offer to sell nor a solicitation of an offer to buy or subscribe for securities of Formycon AG. No public offering of securities of Formycon AG will be made nor is a public offering intended. This document and the information contained therein may not be distributed in or into the United States of America, Canada, Australia, Japan or any other jurisdictions, in which such offer or such solicitation would be prohibited. This document does not constitute an offer for the sale of securities in the United States.
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^[1] Lucentis^® is a registered trademark of Genentech Inc.
^[2] Ravegza^® is a registered Trademark of MS Pharma
^[3] Ranopto^TM is a Trademark of Teva Canada Ltd.
^[4] Ranivisio^® is a registered Trademark of Bioeq AG
^[5] Stelara^®^is a registered Trademark of Johnson & Johnson
^ ^[6] Keytruda® is a registered Trademark of Merck Sharp & Dohme LLC
^[i] For the Q1 2023 reporting the company preliminarily assumed that revenues from the license agreement for FYB202, including upfront and milestone payments would be realized at “point in time” when they were due under IFRS 15. With further evaluation of revenue recognition of the respective contract during the second quarter of 2023 it became evident that revenues recognition has to be handled as following: Upfront payments, relating to the at that point unfinished license, fulfilled the criteria of IFRS 15 and thus to be realized at the respective point in time of the payment, while revenues from milestone payments relating to development milestones need to be realized over time based on the cost-to-cost method in relation to the respective development expenditure. This also resulted in the associated expenditure no longer falling under IAS 38 and therefore no longer being capitalized as internally generated intangible asset but recognized as cost of sales in the statement of comprehensive income.
After retrospective correction as of Feb. 1, 2023 the published key performance indicators for 1Q 2023 change as follows, increasing Revenues as well as Cost of Goods Sold and therefore being without significant impact on EBITDA or Net Income:
*In € million* *Q1/2023 as published* *Correction* *Q1/2023 after correction*
Revenue 21.5 10.9 32.4
EBITDA 4.5 1.5 6.0
EBIT 4.1 1.5 5.6
Net Income -13.5 1.1 -12.4
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08.05.2024 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Language: English
Company: Formycon AG
Fraunhoferstraße 15
82152 Planegg-Martinsried
Germany
Phone: 089 864667 100
Fax: 089 864667 110
Internet: www.formycon.com
ISIN: DE000A1EWVY8
WKN: A1EWVY
Indices: Scale 30
Listed: Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt (Scale), Hamburg, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1898085
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