Apellis Pharmaceuticals Reports Fourth Quarter and Full Year 2022 Financial Results
- SYFOVRE™ (pegcetacoplan injection) approved in the U.S. as the first and only treatment for geographic atrophy (GA) secondary to age-related macular degeneration (AMD)
- EU marketing authorization application for intravitreal pegcetacoplan validated by the European Medicines Agency; decision by European Commission (EC) expected in early 2024
- EMPAVELI® (pegcetacoplan) sNDA approved including Phase 3 PRINCE data and 48-week Phase 3 PEGASUS data
- Generated $65.1 million in full year 2022 EMPAVELI U.S. net product revenues
WALTHAM, Mass., Feb. 21, 2023 (GLOBE NEWSWIRE) -- Apellis Pharmaceuticals, Inc. (Nasdaq: APLS), a global biopharmaceutical company and leader in complement, today announced its fourth quarter and full year 2022 financial results and business highlights.
“2022 was another year of remarkable execution for Apellis as we moved closer toward our goal of bringing SYFOVRE to patients with GA worldwide and continued to elevate the standard of care in PNH with EMPAVELI. Last week, we were thrilled to announce the FDA approval of SYFOVRE as the first and only treatment approved for patients living with GA, and we are now ready to launch in the U.S.,” said Cedric Francois, M.D., Ph.D., co-founder and chief executive officer of Apellis. “With two commercial products, a robust pipeline of multiple late-stage programs, and a portfolio of pre-clinical assets heading towards the clinic, we believe we are in a strong position for 2023 and beyond.”
Dr. Francois continued, “With our first two approvals in less than two years, we believe we have only begun to unlock the potential of targeting C3 to treat some of the most challenging diseases that patients face. We look forward to building on this momentum.”
Fourth Quarter and Full Year 2022 Business Highlights and Upcoming Milestones:
- SYFOVRE for the treatment of GA secondary to AMD:
- On February 17, 2023, the FDA approved SYFOVRE for the treatment of GA secondary to AMD. Apellis expects the commercial launch of SYFOVRE by the beginning of March 2023.
- A marketing authorization application for intravitreal pegcetacoplan was validated and is currently under review by the European Medicines Agency with an EC decision expected in early 2024.
- Apellis also submitted a New Drug Submission for SYFOVRE to Health Canada and expects to submit applications in Switzerland, Australia and the United Kingdom in the first quarter of 2023.
- APL-2006: Apellis expects to submit an investigational new drug (IND) application for APL-2006, a bispecific C3 and VEGF inhibitor, in the first half of 2023.
Paroxysmal Nocturnal Hemoglobinuria (PNH) Highlights
- EMPAVELI for the treatment of PNH:
- Apellis recorded $19.7 million and $65.1 million in EMPAVELI U.S. net product revenue for the fourth quarter and full year 2022, respectively.
- In February 2023, the FDA approved the supplemental new drug application (sNDA) with the Phase 3 PRINCE results and the 48-week Phase 3 PEGASUS data.
- The Prescription Drug User Fee Act (PDUFA) target action date for the EMPAVELI Injector sNDA is March 15, 2023. EMPAVELI injector is a custom, on-body drug delivery system that would enable patients to self-administer pegcetacoplan through subcutaneous infusion.
Rare Disease R&D Highlights
- Immune complex membranoproliferative glomerulonephritis (IC-MPGN) and C3 glomerulopathy (C3G): Apellis continues to enroll patients in the Phase 3 VALIANT study of systemic pegcetacoplan for IC-MPGN and C3G.
- Amyotrophic lateral sclerosis (ALS): Apellis expects to report top-line results from its ongoing and potentially registrational Phase 2 MERIDIAN study of systemic pegcetacoplan for ALS in mid-2023.
- Cold agglutinin disease (CAD): Sobi, Apellis’ global co-development partner for systemic pegcetacoplan, continues to enroll patients in the Phase 3 CASCADE study of systemic pegcetacoplan for CAD.
- Hematopoietic stem cell transplantation-associated thrombotic microangiopathy (HSCT-TMA): Sobi continues to enroll patients in its Phase 2 study evaluating the efficacy and safety of systemic pegcetacoplan in patients with HSCT-TMA. Data from this study is expected in the second half of 2023.
- EMPAVELI + small interfering RNA (siRNA): Apellis is studying the combination of EMPAVELI and an siRNA in pre-clinical studies, which may offer the potential to reduce the treatment frequency of EMPAVELI. Apellis expects to submit an IND application for its siRNA in the first half of 2023.
Neurology R&D Highlights
- APL-1030: Apellis continues to advance pre-clinical studies with APL-1030, a first-in-class, brain-active C3 inhibitor for neurological diseases.
Fourth Quarter and Full Year 2022 Financial Results:
Cash. As of December 31, 2022, Apellis had $551.8 million in cash and cash equivalents, compared to $700.6 million in cash, cash equivalents, and short-term marketable securities as of December 31, 2021.
- Total revenue was $22.7 million for the fourth quarter of 2022, which consisted of $19.7 million of U.S. net product revenue of EMPAVELI and additional licensing and other revenue associated with the Sobi collaboration. Total revenue was $60.3 million for the fourth quarter of 2021, which consisted of $9.2 million in U.S. net product revenue of EMPAVELI and $51.1 million in revenue associated with the $50.0 milestone and additional licensing and other revenue from the Sobi collaboration.
- For the full year 2022, total revenue was $75.4 million, which consisted of $65.1 million of U.S. net product revenue of EMPAVELI and additional licensing and other revenue associated with the Sobi collaboration. For the full year 2021, total revenue was $66.6 million, which consisted of $15.1 million in U.S. net product revenue of EMPAVELI and $51.4 million in revenue associated with the $50.0 milestone and additional licensing and other revenue from the Sobi collaboration.
Cost of Sales.
- Cost of sales were $5.6 million and $0.2 million for the full year 2022 and 2021, respectively. Cost of sales consists primarily of costs associated with the manufacturing of EMPAVELI, royalties owed to our licensor for such sales, and certain period costs.
- Prior to receiving FDA approval for EMPAVELI in May 2021, costs associated with the manufacturing of EMPAVELI inventory were expensed as research and development (R&D) expense. This resulted in inventory being sold during the years ended December 31, 2022 and 2021 for which a portion of the costs had been previously expensed prior to FDA approval.
- R&D expenses were $99.4 million for the fourth quarter of 2022, compared to $108.2 million for the same period in 2021. For the full year ended December 31, 2022, R&D expenses were $387.2 million compared to $425.9 million for the full year ended December 31, 2021.
- The decrease in R&D expenses for the full year ended December 31, 2022 was primarily attributable to $75.0 million associated with the Beam collaboration and the $5.0 million licensee fee to the University of Pennsylvania related to the Sobi transaction recorded in 2021, a decrease in clinical contract manufacturing expenses due primarily to the timing of drug supply and analytical activity, and a decrease in clinical trial costs due to the completion of our Phase 3 OAKS and DERBY trials. These decreases were offset by higher personnel related costs due to having more employees as of December 31, 2022, higher research and innovation costs, and higher other research and development supporting activities. In addition, contra research and development expenses under the Sobi collaboration were $5.0 million for the year ended December 31, 2022 compared to $32.0 million for the year ended December 31, 2021.
General and Administrative (G&A) Expenses.
- G&A expenses were $84.4 million for the fourth quarter of 2022, compared to $41.5 million for the same period in 2021. For the full year ended December 31, 2022, G&A expenses were $277.2 million compared to $176.8 million for the full year ended December 31, 2021.
- The increase in G&A expenses for the full year ended December 31, 2022 was primarily attributable to an increase in employee related costs and increases in costs related to general commercial preparation activities.
Net Loss (Income). Apellis reported a net loss of $166.0 million and $652.2 million for the fourth quarter and full year 2022, respectively, compared to a net loss of $147.9 million and $746.4 million for the same periods in 2021.
About SYFOVRE™ (pegcetacoplan injection)
SYFOVRE™ (pegcetacoplan injection) is the first and only approved therapy for geographic atrophy (GA). By targeting C3, SYFOVRE is designed to provide comprehensive control of the complement cascade, part of the body’s immune system. SYFOVRE is approved in the United States for the treatment of GA secondary to age-related macular degeneration.
About EMPAVELI® (pegcetacoplan)
EMPAVELI® (pegcetacoplan) is the first and only approved therapy for PNH targeting C3, the central protein in the complement cascade. EMPAVELI acts proximally in the complement cascade controlling both C3b-mediated extravascular hemolysis and terminal complement-mediated intravascular hemolysis. EMPAVELI is approved in the United States for the treatment of adults with paroxysmal nocturnal hemoglobinuria (PNH).
U.S. Important Safety Information for SYFOVRE™ (pegcetacoplan injection)
- SYFOVRE is contraindicated in patients with ocular or periocular infections, and in patients with active intraocular inflammation
WARNINGS AND PRECAUTIONS
- Endophthalmitis and Retinal Detachments
- Intravitreal injections, including those with SYFOVRE, may be associated with endophthalmitis and retinal detachments. Proper aseptic injection technique must always be used when administering SYFOVRE to minimize the risk of endophthalmitis. Patients should be instructed to report any symptoms suggestive of endophthalmitis or retinal detachment without delay and should be managed appropriately.
- Neovascular AMD
- In clinical trials, use of SYFOVRE was associated with increased rates of neovascular (wet) AMD or choroidal neovascularization (12% when administered monthly, 7% when administered every other month and 3% in the control group) by Month 24. Patients receiving SYFOVRE should be monitored for signs of neovascular AMD. In case anti-Vascular Endothelial Growth Factor (anti-VEGF) is required, it should be given separately from SYFOVRE administration.
- Intraocular Inflammation
- In clinical trials, use of SYFOVRE was associated with episodes of intraocular inflammation including: vitritis, vitreal cells, iridocyclitis, uveitis, anterior chamber cells, iritis, and anterior chamber flare. After inflammation resolves, patients may resume treatment with SYFOVRE.
- Increased Intraocular Pressure
- Acute increase in IOP may occur within minutes of any intravitreal injection, including with SYFOVRE. Perfusion of the optic nerve head should be monitored following the injection and managed as needed.
- Most common adverse reactions (incidence ≥5%) are ocular discomfort, neovascular age-related macular degeneration, vitreous floaters, conjunctival hemorrhage.
Please see accompanying full Prescribing Information for more information.
U.S. Important Safety Information for EMPAVELI
BOXED WARNING: SERIOUS INFECTIONS CAUSED BY ENCAPSULATED BACTERIA
- Meningococcal infections may occur in patients treated with EMPAVELI and may become rapidly life-threatening or fatal if not recognized and treated early. Use of EMPAVELI may predispose individuals to serious infections, especially those caused by encapsulated bacteria, such as Streptococcus pneumoniae, Neisseria meningitidis types A, C, W, Y, and B, and Haemophilus influenzae type B.
- Comply with the most current Advisory Committee on Immunization Practices (ACIP) recommendations for vaccinations against encapsulated bacteria.
- Vaccinate patients at least 2 weeks prior to administering the first dose of EMPAVELI unless the risks of delaying therapy with EMPAVELI outweigh the risk of developing a serious infection.
- Vaccination reduces, but does not eliminate, the risk of serious infections. Monitor patients for early signs of serious infections and evaluate immediately if infection is suspected.
- EMPAVELI is available only through a restricted program under a Risk Evaluation and Mitigation Strategy (REMS). Under the EMPAVELI REMS, prescribers must enroll in the program.
- Hypersensitivity to pegcetacoplan or to any of the excipients
- Not currently vaccinated against certain encapsulated bacteria, unless the risks of delaying EMPAVELI treatment outweigh the risks of developing a bacterial infection with an encapsulated organism
- Unresolved serious infection caused by encapsulated bacteria including Streptococcus pneumoniae, Neisseria meningitidis, and Haemophilus influenzae
WARNINGS AND PRECAUTIONS
Serious Infections Caused by Encapsulated Bacteria
The use of EMPAVELI may predispose individuals to serious, life-threatening, or fatal infections caused by encapsulated bacteria, including Streptococcus pneumoniae, Neisseria meningitidis types A, C, W, Y, and B, and Haemophilus influenzae type B (Hib). To reduce the risk of infection, all patients must be vaccinated against these bacteria according to the most current ACIP recommendations for patients with altered immunocompetence associated with complement deficiencies. Revaccinate patients in accordance with ACIP recommendations considering the duration of therapy with EMPAVELI.
For patients without known history of vaccination, administer required vaccines at least 2 weeks prior to receiving the first dose of EMPAVELI. If immediate therapy with EMPAVELI is indicated, administer required vaccine as soon as possible and provide patients with 2 weeks of antibacterial drug prophylaxis.
Closely monitor patients for early signs and symptoms of serious infection and evaluate patients immediately if an infection is suspected. Promptly treat known infections. Serious infection may become rapidly life-threatening or fatal if not recognized and treated early. Consider discontinuation of EMPAVELI in patients who are undergoing treatment for serious infections.
Because of the risk of serious infections, EMPAVELI is available only through a restricted program under a REMS. Under the EMPAVELI REMS, prescribers must enroll in the program and must counsel patients about the risk of serious infection, provide the patients with the REMS educational materials, and ensure patients are vaccinated against encapsulated bacteria. Enrollment and additional information are available by telephone: 1-888-343-7073 or at www.empavelirems.com.
Systemic hypersensitivity reactions (e.g., facial swelling, rash, urticaria) have occurred in patients treated with EMPAVELI. One patient (less than 1% in clinical studies) experienced a serious allergic reaction which resolved after treatment with antihistamines. If a severe hypersensitivity reaction (including anaphylaxis) occurs, discontinue EMPAVELI infusion immediately, institute appropriate treatment, per standard of care, and monitor until signs and symptoms are resolved.
Monitoring PNH Manifestations after Discontinuation of EMPAVELI
After discontinuing treatment with EMPAVELI, closely monitor for signs and symptoms of hemolysis, identified by elevated LDH levels along with sudden decrease in PNH clone size or hemoglobin, or reappearance of symptoms such as fatigue, hemoglobinuria, abdominal pain, dyspnea, major adverse vascular events (including thrombosis), dysphagia, or erectile dysfunction. Monitor any patient who discontinues EMPAVELI for at least 8 weeks to detect hemolysis and other reactions. If hemolysis, including elevated LDH, occurs after discontinuation of EMPAVELI, consider restarting treatment with EMPAVELI.
Interference with Laboratory Tests
There may be interference between silica reagents in coagulation panels and EMPAVELI that results in artificially prolonged activated partial thromboplastin time (aPTT); therefore, avoid the use of silica reagents in coagulation panels.
Most common adverse reactions in patients with PNH (incidence ≥10%) were injection-site reactions, infections, diarrhea, abdominal pain, respiratory tract infection, pain in extremity, hypokalemia, fatigue, viral infection, cough, arthralgia, dizziness, headache, and rash.
USE IN SPECIFIC POPULATIONS
Females of Reproductive Potential
EMPAVELI may cause embryo-fetal harm when administered to pregnant women. Pregnancy testing is recommended for females of reproductive potential prior to treatment with EMPAVELI. Advise female patients of reproductive potential to use effective contraception during treatment with EMPAVELI and for 40 days after the last dose.
Please see full Prescribing Information, including Boxed WARNING regarding serious infections caused by encapsulated bacteria, and Medication Guide.
Apellis Pharmaceuticals, Inc. is a global biopharmaceutical company that combines courageous science and compassion to develop life-changing therapies for some of the most challenging diseases patients face. We ushered in the first new class of complement medicine in 15 years and now have two approved medicines targeting C3. These include the first and only therapy for geographic atrophy, a leading cause of blindness around the world. With nearly a dozen clinical and pre-clinical programs underway, we believe we have only begun to unlock the potential of targeting C3 across many serious diseases. For more information, please visit http://apellis.com or follow us on Twitter and LinkedIn.
Apellis Forward-Looking Statement
Statements in this press release about future expectations, plans and prospects, as well as any other statements regarding matters that are not historical facts, may constitute “forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: whether SYFOVRE will be commercially available when expected; whether clinical trials of SYFOVRE indicate an apparent positive effect that is greater than the actual positive effect, whether SYFOVRE will receive approval from foreign regulatory agencies for GA when expected or at all; whether the company’s clinical trials will be fully enrolled and completed when anticipated; whether preliminary or interim results from a clinical trial will be predictive of the final results of the trial; whether results obtained in preclinical studies and clinical trials will be indicative of results that will be generated in future clinical trials; whether pegcetacoplan will successfully advance through the clinical trial process on a timely basis, or at all; whether the results of the company’s clinical trials will warrant regulatory submissions and whether systemic pegcetacoplan will receive approval from the FDA or equivalent foreign regulatory agencies for CAD, C3G, IC-MPGN, HSCT-TMA, ALS or any other indication when expected or at all; whether, if Apellis’ products receive approval, they will be successfully distributed and marketed; and other factors discussed in the “Risk Factors” section of Apellis’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 21, 2023 and the risks described in other filings that Apellis may make with the Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof, and Apellis specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
|APELLIS PHARMACEUTICALS, INC.|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|(Amounts in thousands, except per share amounts)|
|December 31,||December 31,|
|Cash and cash equivalents||$||551,801||$||640,192|
|Other current assets||36,658||70,677|
|Total current assets||719,523||824,047|
|Property and equipment, net||6,148||6,177|
|Liabilities and Stockholders' Equity|
|Current portion of development liability||29,504||7,584|
|Current portion of right of use liabilities||5,625||4,115|
|Total current liabilities||167,610||131,847|
|Long-term development liability||315,647||345,151|
|Convertible senior notes||92,736||189,024|
|Commitments and contingencies (Note 16)|
|Preferred stock, $0.0001 par value; 10,000 shares authorized and zero shares issued and outstanding at December 31, 2022 and 2021||—||—|
|Common stock, $0.0001 par value; 200,000 shares authorized at December 31, 2022 and 2021; 110,772 and 97,524 shares issued and outstanding at December 31, 2022 and 2021||11||10|
|Additional paid-in capital||2,479,596||1,857,430|
|Accumulated other comprehensive loss||(875||)||(2,090||)|
|Total stockholders' equity||169,872||198,662|
|Total liabilities and stockholders' equity||$||760,217||$||881,765|
|APELLIS PHARMACEUTICALS, INC.|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS|
|(Amounts in thousands, except per share amounts)|
|For the Three Months Ended December 31,||Year Ended December 31,|
|Product revenue, net||$||19,653||$||9,210||$||65,092||$||15,147|
|Licensing and other revenue||3,010||51,080||$||10,330||$||51,416|
|Cost of sales||2,925||45||5,636||200|
|Research and development||99,423||78,180||387,236||345,869|
|Cost of research collaboration||—||25,000||—||75,000|
|General and administrative||84,368||41,462||277,163||176,771|
|Net operating income/(loss)||(164,053||)||(89,397||)||(594,613||)||(536,277||)|
|Loss on conversion of debt||—||—||(32,890||)||(100,589||)|
|Loss from remeasurement of development derivative liability||—||(55,192||)||—||(97,675||)|
|Other (expense)/income, net||(246||)||(169||)||(288||)||1,362|
|Net loss before taxes||(167,462||)||(147,739||)||(651,503||)||(746,002||)|
|Income tax expense||(1,471||)||196||669||352|
|Other comprehensive (loss)/gain:|
|Unrealized (loss)/gain on marketable securities||382||9||(1||)||9|
|Unrealized gain on pension plans||1,646||—||1,646||—|
|Foreign currency gain/(loss)||124||71||(430||)||(1,982||)|
|Total other comprehensive income/(loss)||2,152||80||1,215||(1,973||)|
|Comprehensive loss, net of tax||$||(163,839||)||$||(147,855||)||$||(650,957||)||$||(748,327||)|
|Net loss per common share, basic and diluted||$||(1.50||)||$||(1.61||)||$||(6.15||)||$||(8.84||)|
|Weighted-average number of common shares used in net loss per common share, basic and diluted||110,629||92,149||106,114||84,421|