Formycon reports successful first half of 2023 – Biotech Investments

Press Release // August 30, 2023

Formycon reports successful first half of 2023

• Development of biosimilar candidates proceeds successfully and according to plan
• € 43.8 million represent highest group revenue in Formycon’s history (+148%) partly due to significant success payments for FYB202 as well as participation in the marketing proceeds of FYB201
• Group EBITDA of € 7.3 million (H1/2022: € -7.6 million) and Group EBIT of € 6.4 million (H1/2022: € -8.5 million) mainly due to increase in revenue
• Group net result of € 1.8 million (H1/2022: € 80,0 million) affected by transaction-related and non-cash positive effect from 2022
• Group revenue guidance for fiscal year 2023 concretized at € 75.0 million to € 85.0 million

Munich – Formycon AG (ISIN: DE000A1EWVY8/ WKN: A1EWVY) today published the financial results and the corporate development of Formycon Group for the first half of 2023.

Strong development of Biosimilar pipeline and good market establishment of FYB201 drive corporate success in the first half of 2023

The successful progress in the development of the biosimilar candidates forms the basis for Formycons long-term and sustainable growth. The late-stage biosimilar projects FYB202 (ustekinumab) and FYB203 (aflibercept) have successfully concluded the clinical development phase in the first half of the year.

The submission of the Biologics License Application for FYB203 (Eylea^®1 biosimilar candidate) to the U.S. Food and Drug Administration (“FDA”) and the subsequent acceptance of the application (“File Acceptance”) has already been reported. FYB203 submission to the European Medicines Agency (“EMA”) is also planned in the course of this year. The same applies for FYB202 (Stelara^®2 biosimilar candidate), which is scheduled to be submitted to both authorities during 2023. Together with its global commercialization partner Fresenius Kabi, Formycon also secured a settlement agreement (after the end of the reporting period) with Johnson & Johnson for the launch of FYB202 following approval in the U.S. no later than April 15, 2025.

Keytruda^®3 biosimilar candidate FYB206 is in an advanced preclinical development stage and is expected to enter clinical development during 2024. In addition, Formycon is continuously investing in the further expansion of the biosimilar pipeline and significantly enriched its product portfolio last year with the development start of two new biosimilar candidates (FYB208 & FYB209).

“We look back on a successful first half-year with many positive events. The conclusion of the global commercialization partnership with Fresenius Kabi, the successfully completed clinical trials of our biosimilar candidates FYB202 and FYB203 as well as their submissions to the respective regulatory authorities, some of which have already been completed and some of which are still planned for this year, are important milestones in the Company’s development,“ comments Dr. Stefan Glombitza, CEO of Formycon AG.

With FYB201, a Lucentis^®4 biosimilar was successfully launched on the market, reaching a market share of roughly 17%[i] in the U.S. by the end of the first half of 2023, with a further upward trend. The development of the market share achieved by Formycon’ s commercialization partner Teva in the UK as part of a national tender is also extremely satisfying. Due to the highly fragmented EU market, country-level product launches of FYB201 will take place sequentially through the end of 2023, with further launches in countries such as Brazil, Canada and Saudi Arabia planned in 2024.

With launches in additional territories by the end of 2023 as well as in 2024, Formycon expects further increasing revenue and net-earnings contributions from product commercialization by the respective commercialization partners.

COVID-19: Changed situation of FYB207 project – Focus on biosimilar pipeline

The lifting of the global health emergency by World Health Organization (“WHO”) has changed the framework for the innovative COVID-19 drug FYB207. Based on economic as well as strategic factors, the project was re-evaluated with the result that the development of the innovative FYB207 drug will initially be pursued only in focused areas and in a very resource-sparing way. Formycon remains confident in this platform and remains committed to moving FYB207 into a strategic development partnership. Scientific advice meetings and patent applications will be continued and further funding opportunities will be evaluated to ensure a quick move into the clinical phase if needed.

Key financial figures underline progressive development

The Group’s key financial figures developed very positive as of June 30, 2023: Group revenues increased to a total of € 43.8 million in the first half of 2023, more than doubling (+148%) compared to the same period last year (H1/2022: € 17.6 million).

A significant part of the revenue resulted from the success payments under the commercialization partnership with Fresenius Kabi from the FYB202 project. As a result of the permanent reimbursement code (Q-code) issued in the U.S. since April 01 and the associated simplification of the reimbursement process, the U.S. distribution partner Coherus BioSciences, Inc. was able to more than quadruple net sales of CIMERLI™⁵ in the second quarter to US$ 26.7 million[ii] compared to the first quarter (Q1/2023: US$ 6.2 million)[iii]. As a result, direct licensing revenues for Formycon also increased to a total of € 1.2 million in the first half of the year (Q1/2023: € 0.3 million).

EBITDA and EBIT clearly positive in H1 due to milestone payments

Consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to € 7.3 million (H1/2022: € -7.6 million), while operating profit (EBIT) were around € 6.4 million as of June 30, 2023, compared with € -8.5 million in the same period of the previous year, and were mainly driven by the significant increase in revenues.

Net result continues to show effects from at-equity consolidation and from contingent liability to ATHOS KG

The Group’s net result remains impacted by the following effects, which are recognized in earnings but not in cash: Due to the at-equity consolidation of the 50% share in Bioeq AG and the resulting pro-rata loss of € -6.2 million, as well as the fair value valuation of the contingent purchase price component to ATHOS KG for the acquired assets (FYB201 and FYB202) in the amount of € 8.5 million, the consolidated net result for the first half of the year 2023 stood at € 1.8 million (H1/2022: € 80.0 million). In addition, a deferred tax expense of around € 7.3 million was recognized in the reporting period (H1/2022: € 0 million).

The Group’s financial position at the reporting date of June 30, 2023 remained solid: Cash and cash equivalents totaled around € 36.9 million compared to € 9.8 million at December 31, 2022. At the beginning of 2023 Formycon was able to place a capital increase against contributions in cash in the amount of approximately € 70.1 million (gross proceeds). After an initial repayment of the shareholder loans in the amount of € 20.0 million, € 20.0 million remain drawn as of June 30, 2023.

„We can be very satisfied with the key figures and the business performance in the first half of the year. We are striving to build Formycon into a globally operating company with a focus on biosimilars, while maintaining our high-quality performance. In order to achieve this, we will continue to invest significantly in expanding our pipeline and capacity. We were able to further concretize and slightly increase our guidance for the full year 2023, so that we can expect the highest revenue in the company’s history so far,” comments Enno Spillner, CFO of Formycon AG.

Formycon Group Forecast for 2023 concretized

For 2023, the Formycon Group expects revenues between € 75.0 million and € 85.0 million, which will predominantly result from marketing revenues of the Lucentis® biosimilar (FYB201) Ranivisio®⁶/ Ongavia®⁷ /CIMERLI™ and success payments for the FYB202 project as well as development services for the out-licensed (FYB203) and the partnered project (FYB201).

As the Company remains in investment and development mode, EBITDA is forecast to be between
€ -5.0 million and € -15.0 million. The same applies to the Group net result, adjusted for the one-off effect from the investment in FYB 202 GmbH & Co. KG, which is expected to be between € -20.0 million and € -30.0 million.

The full Half-Year-Report can be found at Financial Reports – Formycon AG

Formycon‘s Executive Board will introduce the company’s development and key financial figures for the first half year 2023 in a conference call.

The conference call, streamed live on the internet, will be held in English on August 30, 2023 at 3:00 p.m. (CEST).

To join via phone, please register at:
https://webcast.meetyoo.de/reg/fXJJiMRIoBqe

You will then receive a confirmation email with the telephone number, access code and PIN to access the call.

The presentation and audio can be accessed via the following link:
https://www.webcast-eqs.com/formycon-2023-h1

Following a short presentation, the Executive Board will be available for direct questions. A recording of the conference call can subsequently be accessed via the Formycon website at:
https://www.formycon.com/en/investor-relations/facts-figures/

¹⁾ Eylea® is a registered trademark of Regeneron Pharmaceuticals Inc.

²⁾ Stelara® is a registered trademark of Johnson & Johnson

³⁾ Keytruda® is a registered trademark of Merck Sharp & Dohme LLC

⁴⁾ Lucentis® is a registered trademark of Genentech Inc.

⁵⁾ CIMERLI^TM is a trademark of Coherus BioSciences, Inc.

⁶⁾ Ranivisio® is a registered trademark of Bioeq AG

⁷⁾ Ongavia® is a registered trademark of Teva Pharmaceutical Industries Ltd.

About Formycon:
Formycon (ISIN: DE000A1EWVY8 / WKN: A1EWVY) is a leading, independent developer of high-quality biopharmaceutical medicines, especially biosimilars. The company focuses on treatments in ophthalmology, immunology and on other key chronic diseases, covering the entire value chain from technical development to the clinical phase III as well as the preparation of dossiers for marketing approval. With its biosimilars, Formycon is making a major contribution towards providing as many patients as possible with access to vital and affordable medicines. Formycon currently has six biosimilars in development.

About Biosimilars:
Since their introduction in the 1980s, biopharmaceuticals have revolutionized the treatment of serious diseases such as cancer, diabetes, rheumatoid arthritis, multiple sclerosis and eye diseases. In the coming years, many of these biotech drugs will lose their patent protection – and by 2025, medications with revenues of approximately US$ 100 billion will be off patent. Biosimilars are follow-on versions of biopharmaceuticals, for which exclusivity has expired. They are approved via stringent regulatory pathways in highly regulated markets (such as EU, US, Japan, Canada, Australia) based on proven similarity of the biosimilar with the originator biopharmaceutical reference product. Currently, global sales of biosimilars are estimated at more than US$ 15 billion. By 2030, analysts estimate that this figure could rise to over US$ 74 billion.

Contact:
Sabrina Müller
Senior Manager Corporate Communications and Investor Relations
Formycon AG
Fraunhoferstr. 15
82152 Martinsried/Planegg/Germany
phone +49 (0) 89 – 86 46 67 149
fax + 49 (0) 89 – 86 46 67 110
Sabrina.Mueller@formycon.com // www.formycon.com
 

Disclaimer:
This press release may contain forward-looking statements and information which are based on our 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.

^[i] https://seekingalpha.com/article/4623127-coherus-biosciences-inc-chrs-q2-2023-earnings-call-transcript?open_reset_password=true&origin=confirm_registration&utm_campaign=%7Cconfirmation_link_registration&utm_medium=email&utm_source=seeking_alpha

^[ii] Coherus BioSciences Reports Second Quarter 2023 Financial Results and Business Highlights | Coherus BioSciences, Inc.

^[iii] Coherus BioSciences Reports First Quarter 2023 Financial Results and Business Highlights | Coherus BioSciences, Inc.