Formycon publishes nine-month results for 2023 – Biotech Investments

Press release // November 13, 2023

Formycon publishes nine-month results for 2023

• Development of the biosimilar portfolio is progressing according to plan – further news flow expected by the end of 2023
• More than 200,000 doses of FYB201 now administered to patients worldwide
• Group revenue rises to a total of € 60.2 million (Q3/2022: € 28.2 million) and includes success payments from the global partnership of FYB202 as well as participation in marketing proceeds of FYB201
• Group EBITDA of € 5.2 million (Q3/2022: € -10.9 million) continues to be positive due to the increase in revenue
• Group net result for the period rises to € 74.3 million (Q3/2022: € 61.1 million) due to an one-off, non-cash adjustment in the context of financial income
• Group revenue and EBITDA forecast for the 2023 financial year confirmed – Group net result for the period significantly increased due to the one-off effect

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

On-track development of biosimilar candidates and successfully progressing market establishment of FYB201 are drivers of the company’s success

The successful progress in the development of the biosimilar pipeline forms the basis for Formycon’s long-term and sustainable growth. The submission of the regulatory applications for the two late-stage biosimilar candidates FYB202 (ustekinumab) and FYB203 (aflibercept) to the U.S. Food and Drug Administration (“FDA”) and the European Medicines Agency (“EMA”) is expected to be realized as planned by the end of 2023.

Preparations for the start of the clinical development program for the biosimilar candidate FYB206 (pembrolizumab) are already well advanced. The start of the clinical phase is still scheduled for the course of 2024. In addition, Formycon is investing sustainably in the further expansion of its biosimilar pipeline and significantly expanded its product portfolio last year with the start of development of the two new biosimilar candidates FYB208 and FYB209.

Significant success payments from FYB202 project and participation from FYB201 marketing proceeds are reflected in rising revenue – EBITDA continues to be positive

The Group’s key financial figures continued to develop very positive as of September 30, 2023: The Group’s revenue rose to a total of € 60.2 million in the first nine months of the year, more than doubling (+113%) compared to the same period of the previous year (Q3/2022: € 28.2 million). Consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to € 5.2 million (Q3/2022: € -10.9 million) and were mainly due to the increase in revenue.

A significant part of the revenue resulted from the success payments under the commercialization partnership with Fresenius Kabi from the FYB202 project. The marketing of the ranibizumab biosimilar, which is now available in a total of 16 countries worldwide, is also contributing to an increase in revenue and net earnings contributions.

Primarily in the U.S., sales partner Coherus BioSciences, Inc. significantly increased net sales of CIMERLI®¹ to US$ 40.0 million in the third quarter of 2023 compared to US$ 26.7 million[i] in the second quarter and US$ 6.2 million[ii] in the first quarter. Product sales have exceeded 100,000 doses since launch on October 3, 2022 in the U.S., and CIMERLI® achieved a 29% share of the overall ranibizumab market in the U.S. in the third quarter of 2023.[iii]

As a result, direct license revenue for Formycon increased to a total of € 2.2 million in the first nine months of the year (H1/2023: € 1.2 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 reflected in the topline, but below EBITDA. In the third quarter the at-equity result amounted to € 4.4 million. As at the reporting date of September 30, it totaled € -1.7 million for 2023. Due to the market launches in additional territories by the end of 2023 and in 2024, Formycon expects further increases in revenue and net earnings contributions from product marketing by the respective commercialization partners.

Group net result rises to € 74.3 million due to one-off, non-cash adjustment in the context of financial income

The group net result as of the reporting date is impacted by the effects of the ATHOS transaction from 2022, which had an impact on earnings but not liquidity. As part of a planning update in the FYB201 project, an adjustment of the fair value valuation and the earn-out obligation to ATHOS KG was made, resulting in a corresponding decrease in the fair value of the earn-out obligation and a simultaneous impairment of the shares in Bioeq AG. These two effects result in total accounting financial income and a correspondingly higher financial result for the Formycon Group, which led to a net result of € 74.3 million (Q3/2022: € 61.1 million including one-off effect).

As expected, the Formycon Group’s cash and cash equivalents amounted to around € 35.6 million as of September 30, 2023, compared to € 9.8 million as of December 31, 2022. In order to accelerate the operational progress and the further development of the biosimilar pipeline, particularly in the FYB206 Project, and to ensure that it is in line with the company’s planning, Formycon is currently evaluating possible financing options by raising debt capital.

Formycon Group forecast for the full year 2023 adjusted at net result level – revenue and EBITDA unchanged

For 2023, the Formycon Group continues to expect revenues of between € 75.0 million and € 85.0 million, which will mainly result from marketing proceeds from the Lucentis^®2 biosimilar (FYB201) Ranivisio®³/ Ongavia®⁴ /CIMERLI® and success payments for the FYB202 project as well as from development services for the out-licensed FYB203 project and the FYB201 project developed in partnership. The forecast for key operating figures such as EBITDA is also expected to remain in the range of € -5.0 million to € -15.0 million due to further R&D investments in the product pipeline.

Due to the valuation effect described above, group net income is adjusted upwards as part of the significant increase in financial income and is now expected to be in a range between € 50.0 million and € 60.0 million compared to € -20.0 million and € -30.0 million for 2023.

“The financial result for the first nine months is very positive for Formycon and we can be very satisfied with both the operational and financial development of the company to date. The consistent development of our pipeline and the operational excellence of the entire team are essential value drivers of our company. We will continue to invest dynamically in our biosimilar pipeline in order to accelerate the rapid progress of our assets in the best possible way. At the same time, we want to maintain our high-quality standards. This approach, which is focused on agility, excellence and flexibility, makes us a competitive and focused participant in the growing biosimilar market,” comments Enno Spillner, CFO of Formycon AG.

The Management Board of Formycon AG will discuss the development of the company as well as the most important financial figures for the first nine months of 2023 during a conference call.

The conference call, which will be streamed live online, will be held in English on November 13, 2023 at 3:00 p.m. (CET).

To participate by phone, please register at:
https://webcast.meetyoo.de/reg/7EM0LU0WyIdU

You will then receive a confirmation email with the phone number, as well as the 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-2023-q3

Following a short presentation, the Board of Directors will be available for direct questions. The conference call will be recorded and will be available afterwards via the Formycon website at: https://www.formycon.com/investoren/fakten-zahlen/.

1)  Cimerli® is a registered trademark of Coherus BioSciences, Inc.
2)  Lucentis® is a registered trademark of Genentech Inc.
3)  Ranivisio® is a registered trademark of Bioeq AG
4)  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 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 USD 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 $15 billion. By 2030, analysts estimate that this figure could rise to over $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.

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

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

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