PLX: Elfabrio Geographic Expansion
NYSE:PLX
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Full Year 2023 Financial and Operational Review
Protalix Biotherapeutics, Inc. (NYSE:PLX) announced full year 2023 financial and operational results in a March 14th, 2024 press release and filing of Form 10-K. The reports were followed by a conference call which discussed recent achievements, regulatory updates and financial performance. Since the end of the third quarter, with respect to Elfabrio (PRX-102) partner Chiesi has continued its commercialization activities, obtained additional approvals and launched new studies for a pediatric indication and for approval in Japan.
Revenues for 2023 were $65.5 million, which consisted of $40.4 million of product sales and $25.1 of million license and research and development revenues. This produced a net income of $8.3 million compared to a loss of ($14.9) million in the prior year.
Financial results for the year ending December 31st, 2023, compared to prior year comparable period:
➢ Revenues were $65.5 million, up 37% from $47.6 million; as milestones, stronger sales of Elelyso and first royalty revenues from Elfabrio were generated. Pfizer sales were up 1% and sales in Brazil increased 10% to $12.5 and $10.4 million respectively. Chiesi revenues from R&D reimbursements and the $20 million milestone payment related to Elfabrio approval totaled $21.6 million while Chiesi product revenue reached $17.5 million;
➢ Cost of revenue was up 17% reflecting additional costs from manufacturing of Elelyso and greater volumes of Elelyso sales. Gross margin was 43%; however, we note that there are many moving parts in this number and gross margin excludes previously recognized costs that will be recognized in future batches of product;
➢ Research and development expenses fell 42% to $17.1 million from $29.3 million. Substantial reductions in subcontractor related expenses were partially offset by a slight rise in salary and related expenses. Materials and other expenses were generally lower for the full year;
➢ Selling, general and administrative expenses rose 28% to $15.0 million vs $11.7 million. The increase was related to higher salary and related expenses due to one-time cash bonuses as well as an increase in travel, conferences and employee training;
➢ Net financial expense was ($1.9) million compared to a net financial expense of ($1.4) million due to increases in interest expense;
➢ Income taxes of $0.3 million compare to $0.5 million;
➢ Net income was $8.3 million vs a loss of ($14.9) million, or $0.10 per share versus ($0.31) per share;
The cash and equivalents balance on December 31, 2023 totaled $44.6 million versus $22.2 million at the end of 2022. Cash burn was ($2.6) million for the year. Financing cash flows were $24.7 million predominantly related to proceeds from issuance of common stock through an at-the-market (ATM) facility. We do not anticipate the need to raise capital in at least the next 12 months and perhaps for a substantially longer period depending on Elfabrio’s growth trajectory. Following the end of the year, Protalix announced receipt of an additional ~$5 million from partners for expense reimbursements and sales.
PRX-102 Activity
Following US and EU approval of Elfabrio in May of last year, the compound was further approved in Great Britain and Switzerland during the third quarter of 2023. Along with the full year report for 2023, Protalix announced that Elfabrio had also been approved in Israel. Chesi’s regulatory efforts have been successful and the partner is looking forward to other geographies and populations for further penetration of the PEGylated recombinant human α-Galactosidase-A enzyme. As disclosed in the 10-K regulatory filing, Chesi has begun the FLY study in collaboration with Protalix. While it is still in the start-up stage, the study will be a multi-center, open label trial to assess the safety, pharmacodynamics, efficacy and pharmacokinetics of Elfabrio in patients from two years to less than 18 years of age with confirmed Fabry disease to obtain a pediatric indication in the United States. Chiesi has also begun to enroll its RISE study which aims to enroll 18-20 Fabry patients in Japan. A study such as this is usually required to bridge results to a population with a different genetic makeup and to accommodate different medical practices. The study is expected to be complete in 2028.
PRX-115
In March 2023, Protalix announced that it had dosed its first patient in the Phase I clinical trial for PRX-115 in the treatment of severe gout. Now that almost a year has passed, Protalix has enrolled 56 patients and anticipates publishing the preliminary results from the trial in 2Q:24. The trial is designed as a double-blind, placebo-controlled, single ascending dose study intended to evaluate the safety and pharmacokinetics, pharmacodynamics and immunogenicity of PRX-115. Subjects considered for enrollment will present elevated uric acid levels (>6.0 mg/dL) and no previous exposure to PEGylated uricase. The single ascending dose study enrolled seven cohorts with patients randomized 3:1 to receive a single intravenous dose of PRX-115 or placebo. Other secondary endpoints will examine the reduction in uric acid and dosing efficacy. The study is being conducted at New Zealand Clinical Research under the New Zealand Medicines and Medical Devices Safety Authority. Further details on the clinical trial can be found on clinicaltrials.gov and the related entry under NCT05745727.
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