United Therapeutics Corporation (Nasdaq: UTHR), a public
benefit corporation, today announced its financial results for the
quarter ended March 31, 2024. Total revenues in the first quarter
of 2024 grew 34 percent year-over-year to $677.7 million, compared
to $506.9 million in the first quarter of 2023.
“The first quarter of 2024 represents another quarter of record
revenue and double-digit year-over-year revenue growth,” jointly
said Martine Rothblatt, Ph.D., Chairperson and Chief
Executive Officer and Michael Benkowitz, President and Chief
Operating Officer. “That growth, coupled with our upcoming clinical
reads, puts us in a unique position in the biotech industry: a
company with a solid and growing commercial foundation, near-term
clinical catalysts, and the potential to provide an unlimited
supply of tolerable, transplantable organs.”
“Our distinctive commercial and clinical profile, alongside our
solid balance sheet and cash flow potential, makes United
Therapeutics a compelling investment opportunity,” said James
Edgemond, Chief Financial Officer and Treasurer. “That’s why we
implemented a $1 billion accelerated share repurchase that
concretely demonstrates our belief in our near-term and long-term
potential, despite potential competition emerging this year.”
First Quarter 2024 Financial Results
Key financial highlights include (dollars in millions, except
per share data):
Three Months Ended
March 31,
Dollar Change
Percentage Change
2024
2023
Total revenues
$
677.7
$
506.9
$
170.8
34 %
Net income
$
306.6
$
240.9
$
65.7
27 %
Net income, per basic share
$
6.52
$
5.20
$
1.32
25 %
Net income, per diluted share
$
6.17
$
4.86
$
1.31
27 %
Revenues
The table below presents the components of total revenues
(dollars in millions):
Three Months Ended
March 31,
Dollar Change
Percentage
Change
2024
2023
Net product sales:
Tyvaso DPI®(1)
$
227.5
$
118.7
$
108.8
92 %
Nebulized Tyvaso®(1)
145.0
119.7
25.3
21 %
Total Tyvaso
372.5
238.4
134.1
56 %
Remodulin®(2)
128.0
121.4
6.6
5 %
Orenitram®
106.2
88.2
18.0
20 %
Unituxin®
58.4
49.1
9.3
19 %
Adcirca®
6.4
7.3
(0.9
)
(12 )%
Other
6.2
2.5
3.7
148 %
Total revenues
$
677.7
$
506.9
$
170.8
34 %
(1)
Net product sales include both
the drug product and the respective inhalation device.
(2)
Net product sales include sales
of infusion devices, including the Remunity® Pump.
Total Tyvaso revenues grew by 56 percent to $372.5 million in
the first quarter of 2024, compared to $238.4 million in the first
quarter of 2023. This growth was primarily due to an increase in
quantities sold, driven by the commercial launch of Tyvaso DPI in
June 2022 and continued growth in commercial utilization by
patients with pulmonary hypertension associated with interstitial
lung disease and, to a lesser extent, a price increase.
The growth in Tyvaso DPI revenues resulted primarily from an
increase in quantities sold and, to a lesser extent, a price
increase. The increase in Tyvaso DPI quantities sold was due to
continued growth in the number of patients following the product's
launch and, to a lesser extent, increased commercial utilization
following the implementation of the Part D redesign under the
Inflation Reduction Act.
The growth in nebulized Tyvaso revenues resulted primarily from
inventory destocking by our distributors in the first quarter of
2023, which did not reoccur during the first quarter of 2024.
The growth in Remodulin revenues resulted from an increase in
U.S. Remodulin revenues, driven by an increase in quantities sold,
partially offset by a decrease in international Remodulin revenues,
as shown in the table below.
The increase in Orenitram revenues resulted from an increase in
quantities sold and, to a lesser extent, a price increase. The
increase in quantities sold was driven, at least in part, by
increased commercial utilization following the implementation of
the Part D redesign under the Inflation Reduction Act.
The increase in Unituxin revenues resulted from an increase in
quantities sold and a price increase.
The table below presents the breakdown of total revenues between
the United States and rest-of-world (ROW) (in millions):
Three Months Ended March
31,
2024
2023
U.S.
ROW
Total
U.S.
ROW
Total
Net product sales:
Tyvaso DPI(1)
$
227.5
$
—
$
227.5
$
118.7
$
—
$
118.7
Nebulized Tyvaso(1)
133.7
11.3
145.0
115.7
4.0
119.7
Total Tyvaso
361.2
11.3
372.5
234.4
4.0
238.4
Remodulin(2)
108.3
19.7
128.0
93.2
28.2
121.4
Orenitram
106.2
—
106.2
88.2
—
88.2
Unituxin
53.4
5.0
58.4
44.3
4.8
49.1
Adcirca
6.4
—
6.4
7.3
—
7.3
Other
6.0
0.2
6.2
2.3
0.2
2.5
Total revenues
$
641.5
$
36.2
$
677.7
$
469.7
$
37.2
$
506.9
(1)
Net product sales include both
the drug product and the respective inhalation device.
(2)
Net product sales include sales
of infusion devices, including the Remunity Pump.
Expenses
Cost of sales. The table below summarizes cost of sales
by major category (dollars in millions):
Three Months Ended
March 31,
Dollar Change
Percentage Change
2024
2023
Category:
Cost of sales
$
71.8
$
52.7
$
19.1
36 %
Share-based compensation expense
(benefit)(1)
1.1
(0.4
)
1.5
375 %
Total cost of sales
$
72.9
$
52.3
$
20.6
39 %
(1)
See Share-based compensation
below.
Cost of sales, excluding share-based compensation. Cost of sales
for the three months ended March 31, 2024 increased as compared to
the same period in 2023, primarily due to an increase in Tyvaso DPI
royalty expense and product costs.
Research and development expense. The table below
summarizes the nature of research and development expense by major
expense category (dollars in millions):
Three Months Ended
March 31,
Dollar Change
Percentage Change
2024
2023
Category:
External research and development(1)
$
52.7
$
45.1
$
7.6
17 %
Internal research and development(2)
44.9
34.4
10.5
31 %
Share-based compensation expense(3)
6.4
1.3
5.1
392 %
Impairments(4)
—
—
—
— %
Other(5)
0.1
2.1
(2.0
)
(95 )%
Total research and development expense
$
104.1
$
82.9
$
21.2
26 %
(1)
External research and development
primarily includes fees paid to third parties (such as clinical
trial sites, contract research organizations, and contract
laboratories) for preclinical and clinical studies and payments to
third-party contract manufacturers before FDA approval of the
relevant product.
(2)
Internal research and development
primarily includes salary-related expenses for research and
development functions, internal costs to manufacture product
candidates before FDA approval, and internal facilities-related
expenses, including depreciation, related to research and
development activities.
(3)
See Share-based compensation
below.
(4)
Impairments primarily includes
impairment charges to write down the carrying value of in-process
research and development and of certain property, plant, and
equipment as a result of research and development activities. There
were no impairment charges during the three months ended March 31,
2024 and March 31, 2023.
(5)
Other primarily includes upfront
fees and milestone payments to third parties under license
agreements related to development-stage products and adjustments to
the fair value of our contingent consideration obligations.
Research and development expense, excluding share-based
compensation. Research and development expense for the three months
ended March 31, 2024 increased as compared to the same period in
2023, primarily due to increased expenditures related to: (1) organ
manufacturing projects; and (2) the TETON clinical studies of
nebulized Tyvaso in patients with idiopathic pulmonary fibrosis and
progressive pulmonary fibrosis.
Selling, general, and administrative expense. The table
below summarizes selling, general, and administrative expense by
major category (dollars in millions):
Three Months Ended
March 31,
Dollar Change
Percentage Change
2024
2023
Category:
General and administrative
$
103.1
$
83.7
$
19.4
23 %
Sales and marketing
23.2
16.9
6.3
37 %
Share-based compensation expense
(benefit)(1)
18.1
(13.3
)
31.4
236 %
Total selling, general, and administrative
expense
$
144.4
$
87.3
$
57.1
65 %
(1)
See Share-based compensation
below.
General and administrative, excluding share-based compensation.
General and administrative expense for the three months ended March
31, 2024 increased as compared to the same period in 2023,
primarily due to: (1) an increase in legal expenses related to
litigation matters; and (2) an increase in personnel expense due to
growth in headcount.
Share-based compensation. The table below summarizes
share-based compensation expense (benefit) by major category
(dollars in millions):
Three Months Ended
March 31,
Dollar Change
Percentage Change
2024
2023
Category:
Stock options
$
5.7
$
4.9
$
0.8
16 %
Restricted stock units
15.5
12.2
3.3
27 %
Share tracking awards plan
(STAP)
3.9
(30.0
)
33.9
113 %
Employee stock purchase plan
0.5
0.5
—
— %
Total share-based compensation expense
(benefit)
$
25.6
$
(12.4
)
$
38.0
306 %
The increase in share-based compensation expense for the three
months ended March 31, 2024, as compared to the same period in
2023, was primarily due to an increase in STAP expense driven by a
four percent increase in our stock price for the three months ended
March 31, 2024, as compared to a 19 percent decrease in our stock
price for the same period in 2023.
Other income (expense), net. The change in other income
(expense), net for the three months ended March 31, 2024, as
compared to the same period in 2023, was primarily due to net
unrealized gains on equity securities.
Income tax expense. Income tax expense for the three
months ended March 31, 2024 and 2023 was $92.0 million and $51.0
million, respectively. Our effective income tax rate (ETR)
for the three months ended March 31, 2024 and 2023 was 23 percent
and 17 percent, respectively. Our ETR for the three months ended
March 31, 2024 increased compared to our ETR for the three months
ended March 31, 2023 primarily due to decreased excess tax benefits
from share-based compensation.
Share repurchase. In March 2024, we entered into an
accelerated share repurchase agreement (the ASR agreement)
with Citibank, N.A. (Citi). Under the ASR agreement, we made
an aggregate upfront payment of $1.0 billion to Citi and received
an aggregate initial delivery of 3,275,199 shares of our common
stock on March 27, 2024, representing approximately 80 percent of
the total shares that would be repurchased under the ASR agreement
measured based on the closing price of our common stock on March
25, 2024.
The final number of shares that we will ultimately repurchase
pursuant to the ASR agreement will be based on the average of the
daily volume-weighted average price per share of our common stock
during the repurchase period, less a discount and subject to
adjustments pursuant to the terms and conditions of the ASR
agreement. At the final settlement of the ASR agreement, we may be
entitled to receive additional shares of common stock, or, under
certain limited circumstances, be required to make a cash payment
to Citi or, if we so elect, deliver shares of common stock to Citi.
The final settlement of the transactions under the ASR agreement is
expected to occur in the second quarter of 2024 with respect to
$300 million of the transactions and in the third quarter of 2024
with respect to $700 million of the transactions.
Webcast
We will host a webcast to discuss our first quarter 2024
financial results on Wednesday, May 1, 2024, at 9:00 a.m. Eastern
Time. The webcast can be accessed live via our website at
https://ir.unither.com/events-and-presentations. A replay of the
webcast will also be available at the same location on our
website.
United Therapeutics: Enabling Inspiration
At United Therapeutics, our vision and mission are one. We use
our enthusiasm, creativity, and persistence to innovate for the
unmet medical needs of our patients and to benefit our other
stakeholders. We are bold and unconventional. We have fun; we do
good. We are the first publicly-traded biotech or pharmaceutical
company to take the form of a public benefit corporation
(PBC). Our public benefit purpose is to provide a brighter
future for patients through (a) the development of novel
pharmaceutical therapies; and (b) technologies that expand the
availability of transplantable organs.
You can learn more about what it means to be a PBC here:
unither.com/pbc.
Forward-Looking Statements
Statements included in this press release that are not
historical in nature are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include, among others, statements
related to our revenue growth and cash flow expectations; our
unique position in the biotech industry; upcoming clinical
catalysts; our organ manufacturing programs; the potential to
provide an unlimited supply of tolerable, transplantable organs;
our belief in our near-term and long-term potential, despite
potential competition emerging this year; and our goals of
innovating for the unmet medical needs of our patients and to
benefit our other stakeholders, furthering our public benefit
purpose of developing novel pharmaceutical therapies and
technologies that expand the availability of transplantable organs.
These forward-looking statements are subject to certain risks and
uncertainties, such as those described in our periodic reports
filed with the Securities and Exchange Commission, that could cause
actual results to differ materially from anticipated results.
Consequently, such forward-looking statements are qualified by the
cautionary statements, cautionary language and risk factors set
forth in our periodic reports and documents filed with the
Securities and Exchange Commission, including our most recent
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and
Current Reports on Form 8-K. We claim the protection of the safe
harbor contained in the Private Securities Litigation Reform Act of
1995 for forward-looking statements. We are providing this
information as of May 1, 2024, and assume no obligation to update
or revise the information contained in this press release whether
as a result of new information, future events, or any other
reason.
ORENITRAM, REMODULIN, REMUNITY, TYVASO, TYVASO DPI, and UNITUXIN
are registered trademarks of United Therapeutics Corporation and/or
its subsidiaries.
ADCIRCA is a registered trademark of Eli Lilly and Company.
UNITED THERAPEUTICS
CORPORATION
CONSOLIDATED STATEMENTS OF
OPERATIONS
(In millions, except per share
data)
Three Months Ended
March 31,
2024
2023
(Unaudited)
Total revenues
$
677.7
$
506.9
Operating expenses:
Cost of sales
72.9
52.3
Research and development
104.1
82.9
Selling, general, and administrative
144.4
87.3
Total operating expenses
321.4
222.5
Operating income
356.3
284.4
Interest income
53.8
29.2
Interest expense
(13.3
)
(13.8
)
Other income (expense), net
1.8
(7.9
)
Total other income, net
42.3
7.5
Income before income taxes
398.6
291.9
Income tax expense
(92.0
)
(51.0
)
Net income
$
306.6
$
240.9
Net income per common share:
Basic
$
6.52
$
5.20
Diluted
$
6.17
$
4.86
Weighted average number of common shares
outstanding:
Basic
47.0
46.3
Diluted
49.7
49.6
SELECTED CONSOLIDATED BALANCE
SHEET DATA
(Unaudited, in
millions)
March 31, 2024
Cash, cash equivalents, and marketable
investments
$
4,199.7
Total assets
6,495.2
Total liabilities
1,157.1
Total stockholders’ equity
5,338.1
Category: Earnings
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240501574189/en/
Dewey Steadman (202) 919-4097
https://ir.unither.com/contact-ir
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