Dynavax Technologies Corporation (Nasdaq: DVAX), a
biopharmaceutical company focused on developing and commercializing
novel vaccines, today reported financial results for the first
quarter of 2020.
“Now more than ever, the world is acutely aware
of the crucial role vaccines play in protecting our families,
communities, and those at high risk for infectious disease,”
commented Ryan Spencer, Chief Executive Officer of Dynavax.
“Hepatitis B is a highly infectious deadly virus which, thankfully,
can be prevented with effective vaccination. Our first product,
HEPLISAV-B, provides adults higher levels of protection from
hepatitis B in one month, compared to other hepatitis B vaccines
that require six months. We believe that HEPLISAV-B has the
potential to become the standard of care for adult hepatitis B
vaccination in the U.S.”
Mr. Spencer added, “With uncertainty spawned by
the current pandemic, our focus in 2020 remains driving revenue
growth of HEPLISAV-B, generating data to support a unique dosing
regimen for patients on hemodialysis, and supporting policy
initiatives aimed at protecting more adults through adoption of a
two-dose regimen, all of which position HEPLISAV-B for substantial
long-term growth. Additionally, we have established multiple
research collaborations leveraging our proprietary vaccine
adjuvant, CpG 1018, to support the development of coronavirus
vaccines. Despite the short-term disruptions of this year,
Dynavax’s long-term value proposition remains intact with the added
potential to accelerate the utilization of CpG 1018 globally.”
HEPLISAV-B® [Hepatitis B Vaccine
(Recombinant), Adjuvanted]
- Despite sales reductions at the end of March due to coronavirus
pandemic response, Dynavax achieved first quarter 2020 net product
revenue of $10.5 million compared to $5.6
million for the first quarter of 2019.
- Dynavax has exceeded the HEPLISAV-B minimum product revenue
covenant in its Term Loan Agreement of $30 million for the annual
measurement period ending June 30, 2020.
- On-going clinical trial evaluating immunogenicity and safety of
4-dose regimen of HEPLISAV-B® in adults with end-stage renal
disease (ESRD) who are initiating or undergoing hemodialysis:
- Seroprotection rate of 86.4% demonstrated in interim analysis
of 44 patients
- Safety and efficacy have not been established in this
population; full study data anticipated in the second half of
2020
COVID-19 ResponseDynavax has
focused on four key areas in addressing uncertainty related to the
COVID-19 pandemic:
- Protecting the health and safety of Dynavax’s employees and
customers
- Ensuring access to HEPLISAV-B with a secure supply chain able
to meet U.S. market demand
- Continuing to advance the Company’s on-going clinical trials of
HEPLISAV-B
- Leveraging the Company’s proprietary toll-like receptor 9
(TLR9) agonist adjuvant, CpG 1018, in collaborations to develop
additional adjuvanted vaccines. Dynavax has established multiple
such research collaborations to develop a coronavirus (COVID-19)
vaccine:
Vaccine Approach |
Collaborator |
Country |
Protein Subunit |
University of Queensland |
Australia |
Clover Biopharmaceuticals |
China |
Inactivated Virus |
Sinovac Biotech |
China |
Valneva |
France |
2020 Milestones
- Interim data from ongoing study of HEPLISAV-B in patients on
hemodialysis reported in April 2020; final immunogenicity data
anticipated in the second half of 2020
- Completion of Phase 1-enabling animal studies and toxicology
for an improved pertussis vaccine with CpG 1018
- Inclusion of CpG 1018 in at least one coronavirus vaccine
advanced to Phase 1 clinical evaluation
- Entrance into multiple strategic relationships focused on
initial research in a variety of vaccine candidates to establish
CpG 1018 as a leading adjuvant
- Completion of safety follow-up for HEPLISAV-B post-marketing
studies in Q4 2020
Financial
ResultsProduct Revenue, Net. Product
revenue, net increased to $10.5 million in the first quarter of
2020 compared to $5.6 million in the same period in 2019 due to
higher sales volume as additional healthcare providers completed
operational activities required to switch to HEPLISAV-B and
existing customers placed repeat orders. Although there was a
modest impact from COVID-19 on HEPLISAV-B net product sales in the
first quarter, most medical centers restricted access to their
facilities and focused on providing care to only the most severely
affected patients by mid-March. This has resulted in significantly
reduced utilization of vaccines, including HEPLISAV-B, which is
likely to continue until the U.S. returns to more normal
conditions.
Cost of Sales - Product.
Cost of sales - product for the first quarter 2020 was $2.4
million, compared to $1.8 million for the first quarter of 2019.
The increase is due to higher sales volume and higher unit costs as
we produce and then sell finished product inventory that includes
components for which a portion of the cost has previously been
expensed to research and development prior to approval of the
pre-filled syringe presentation in March 2018.
Research and Development
Expenses. Research and development expenses for the first
quarter of 2020 were $4.7 million, compared to $21.2 million for
the first quarter of 2019. Excluding non-cash stock-based
compensation, R&D expenses decreased to $6.2 million in the
first quarter of 2020, compared to $19.0 million in the first
quarter of 2019. Stock-based compensation for the three
months ended March 31, 2020 included reversal of expenses related
to cancellation of certain equity grants.
SG&A Expenses. Selling,
general and administrative (SG&A) expenses for the first
quarter of 2020 were $20.9 million, compared to $18.3 million for
the first quarter of 2019. The increase for the three months ended
March 31, 2020 compared to 2019, was primarily related to costs
related to the HEPLISAV-B post-marketing study, an increase in
facility costs due to higher overhead allocation to SG&A
functions and changes in non-cash stock-based compensation
resulting from the restructuring.
Net Loss. Net loss allocable
for the first quarter of 2020 was $12.6 million, or $0.15 per basic
share and $0.25 per diluted share, compared to a net loss of $39.7
million, or $0.62 per basic and diluted share, for the first
quarter of 2019.
Cash Position. Cash, cash
equivalents and marketable securities totaled $129.5 million at
March 31, 2020.
Conference Call and Webcast
InformationDynavax will hold a conference call today at
4:30 p.m. ET/1:30 p.m. PT. The live audio webcast may be
accessed through the “Events & Presentations” page on the
“Investors” section of the Company’s website at
www.dynavax.com. Alternatively, participants may dial (866)
420-4066 (domestic) or (409) 217-8237 (international) and refer to
conference ID 1178679. A replay of the webcast will be available
for 30 days following the live event.
Please see Important Safety Information
below.
For more information about HEPLISAV-B, visit
http://heplisavb.com.
About Hepatitis BHepatitis B is
a viral disease of the liver that can become chronic and lead to
cirrhosis, liver cancer and death. The hepatitis B virus is 50 to
100 times more infectious than HIV,i and transmission is on the
rise. There is no cure for hepatitis B, but effective vaccination
can prevent the disease.
In adults, hepatitis B is spread through contact
with infected blood and through unprotected sex with an infected
person. The U.S. Centers for Disease Control (CDC) recommends
vaccination for those at high risk for infection due to their jobs,
lifestyle, living situations and travel to certain areas.ii Because
people with diabetes are particularly vulnerable to infection, the
CDC recommends vaccination for adults age 19 to 59 with diabetes as
soon as possible after their diagnosis, and for people age 60 and
older with diabetes at their physician's discretion.iii
Approximately 20 million U.S. adults have diabetes, and 1.5 million
new cases of diabetes are diagnosed each year.iv
About HEPLISAV-BHEPLISAV-B is an adult
hepatitis B vaccine that combines hepatitis B surface antigen with
Dynavax’s proprietary Toll-like Receptor (TLR) 9 agonist CpG 1018
to enhance the immune response. Dynavax has worldwide commercial
rights to HEPLISAV-B.
Indication and UseHEPLISAV-B is indicated for prevention of
infection caused by all known subtypes of hepatitis B virus in
adults age 18 years and older.
Important Safety Information (ISI)Do not
administer HEPLISAV-B to individuals with a history of severe
allergic reaction (e.g., anaphylaxis) after a previous dose of any
hepatitis B vaccine or to any component of HEPLISAV-B, including
yeast. Appropriate medical treatment and supervision must be
available to manage possible anaphylactic reactions following
administration of HEPLISAV-B. Immunocompromised persons, including
individuals receiving immunosuppressant therapy, may have a
diminished immune response to HEPLISAV-B. Hepatitis B has a long
incubation period. HEPLISAV-B may not prevent hepatitis B infection
in individuals who have an unrecognized hepatitis B infection at
the time of vaccine administration. The most common patient
reported adverse reactions reported within 7 days of vaccination
were injection site pain (23% to 39%), fatigue (11% to 17%) and
headache (8% to 17%).
For full Prescribing Information for HEPLISAV-B, click here.
About DynavaxDynavax is a
commercial stage biopharmaceutical company developing and
commercializing novel vaccines. The Company launched its first
commercial product, HEPLISAV-B® [Hepatitis B Vaccine (Recombinant),
Adjuvanted], in February 2018, following U.S. FDA approval for
prevention of infection caused by all known subtypes of hepatitis B
virus in adults age 18 years and older. Dynavax is also
advancing CpG 1018 as a premier vaccine adjuvant through research
collaborations and partnerships. For more information, visit
www.dynavax.com and follow the company on LinkedIn.
Forward-Looking Statements This
press release contains "forward-looking" statements, including
statements regarding the potential for HEPLISAV-B to become the
standard of care adult hepatitis B vaccine in the U.S., long-term
growth of HEPLISAV-B, the impact of COVID-19 on the utilization of
vaccines, including HEPLISAV-B, the timing of enrollment in and
completion of clinical studies, the results of clinical studies and
what the results will demonstrate or support, developing an
improved pertussis vaccine, a vaccine for COVID-19, and other
vaccines, entering into strategic relationships, and establishing
CpG 1018 as a leading adjuvant. Actual results may differ
materially from those set forth in this press release due to the
risks and uncertainties inherent in our business, including the
risk that the vaccine market and/or the adult hepatitis B market
may not grow as expected, the risk that COVID-19 will continue to
have a significant negative impact on the use of vaccines,
including HEPLISAV-B, until the U.S. returns to more normal
conditions, the adverse effects of the recent coronavirus pandemic
on our ability to access customers and on customer decision making,
adoption and implementation, the risk that HEPLISAV-B may not
provide the anticipated benefits and may not become the standard of
care adult hepatitis B vaccine in the U.S., the risk that our
growth initiatives may not be successful, risks related to whether
and when prescribers and other key decision-makers at potential
purchasing entities will make the decision to switch to HEPLISAV-B,
and the timing and quantity of actual purchases, risks related to
the development and clinical testing of vaccines and whether use of
CpG 1018 will prove to be beneficial in other vaccines, and risks
related to whether existing or future collaborations will be
successful; as well as other risks detailed in the "Risk Factors"
section of our Annual Report on Form 10-K for the fiscal year ended
December 31, 2019, as well as discussions of potential risks,
uncertainties and other important factors in our other filings with
the U.S. Securities and Exchange Commission. We undertake no
obligation to revise or update information herein to reflect events
or circumstances in the future, even if new information becomes
available. Information on Dynavax's website at www.dynavax.com is
not incorporated by reference in our current periodic reports with
the SEC.
Contacts:Nicole Arndt, Senior Manager, Investor
Relationsnarndt@dynavax.com510-665-7264
Derek Cole, President Investor Relations Advisory Solutions
derek.cole@IRadvisory.com_____________________________________________________________________________________i
CDC. https://www.cdc.gov/hepatitis/hbv/bfaq.htm.ii CDC.
https://www.cdc.gov/hepatitis/hbv/hbvfaq.htm.iii CDC.
https://www.cdc.gov/diabetes/pubs/pdf/hepb_vaccination.pdf.iv CDC.
https://www.cdc.gov/diabetes/pdfs/data/statistics/national-diabetes-statistics-report.pdf.
DYNAVAX TECHNOLOGIES
CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except per share
amounts)(Unaudited)
|
Three Months Ended |
|
March 31, |
|
2020 |
|
|
|
2019 |
|
Revenues: |
|
|
|
|
|
|
Product revenue, net |
$ |
10,514 |
|
|
|
$ |
5,627 |
|
Other revenue |
|
405 |
|
|
|
|
146 |
|
Total
revenues |
|
10,919 |
|
|
|
|
5,773 |
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
Cost of sales – product |
|
2,354 |
|
|
|
|
1,800 |
|
Cost of sales - amortization of
intangible assets |
|
2,298 |
|
|
|
|
2,273 |
|
Research and development |
|
4,653 |
|
|
|
|
21,206 |
|
Selling, general and
administrative |
|
20,926 |
|
|
|
|
18,348 |
|
Total operating
expenses |
|
30,231 |
|
|
|
|
43,627 |
|
|
|
|
|
|
|
|
Loss from operations |
|
(19,312 |
) |
|
|
|
(37,854 |
) |
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
Interest income |
|
590 |
|
|
|
|
735 |
|
Interest expense |
|
(4,731 |
) |
|
|
|
(2,734 |
) |
Sublease income |
|
1,926 |
|
|
|
|
- |
|
Change in fair value of warrant
liability |
|
8,610 |
|
|
|
|
- |
|
Other income (expense), net |
|
322 |
|
|
|
|
181 |
|
Net loss |
$ |
(12,595 |
) |
|
|
$ |
(39,672 |
) |
Basic net loss per
share |
$ |
(0.15 |
) |
|
|
$ |
(0.62 |
) |
Weighted average shares
used to compute basic net loss per share |
|
85,477 |
|
|
|
|
63,778 |
|
Diluted net loss per
share |
$ |
(0.25 |
) |
|
|
$ |
(0.62 |
) |
Weighted average shares
used to compute diluted net loss per share |
|
85,648 |
|
|
|
|
63,778 |
|
|
DYNAVAX TECHNOLOGIES CORPORATION
SELECTED BALANCE SHEET DATA(In
thousands)(Unaudited)
|
March 31, |
|
|
December 31, |
|
2020 |
|
|
2019 |
Assets |
|
|
|
|
|
|
Cash, cash equivalents and
marketable securities |
$ |
129,533 |
|
|
$ |
151,055 |
Inventories, net |
|
48,099 |
|
|
|
41,332 |
Property and equipment, net |
|
30,897 |
|
|
|
32,022 |
Intangible assets, net |
|
202 |
|
|
|
2,500 |
Operating lease right-of-use
assets |
|
28,436 |
|
|
|
30,252 |
Goodwill |
|
2,061 |
|
|
|
2,081 |
Other assets |
|
20,028 |
|
|
|
19,826 |
Total
assets |
$ |
259,256 |
|
|
$ |
279,068 |
|
|
|
|
|
|
|
Liabilities and
stockholders’ equity |
|
|
|
|
|
|
Total current liabilities |
$ |
29,279 |
|
|
$ |
53,047 |
Total long-term liabilities |
|
218,153 |
|
|
|
217,731 |
Stockholders’ equity |
|
11,824 |
|
|
|
8,290 |
Total liabilities and
stockholders’ equity |
$ |
259,256 |
|
|
$ |
279,068 |
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