Earnings call transcript Q2 2023

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Operator

Good morning, ladies and gentlemen and welcome to the Protalix BioTherapeutics Conference for Second Quarter 2023 Financial Business Results.

As a reminder, this conference is being recorded. I will now turn the conference over to our host, Mr. Chuck Padala with LifeSci Advisors, Investor Relations for Protalix. Thank you, you may begin the conference.

Charles Padala

welcome and Protalix Business and XXXX Second operator Results Financial Update you, to BioTherapeutics the Quarter Thank Conference Call. are Rubin, and today Protalix; me Dror and President With CEO and Eyal Financial Senior Chief President Vice Officer. Bashan, of and A update this available the was now the Protalix press is the website. and issued announcing on release results morning take moment to statements release. press the a read forward-looking Please in the disclaimer about forward-looking statements. The teleconference earnings release and include this cause risks forward-looking results statements to subject materially uncertainties the to actual These may from known and differ and that unknown are statements made. results could cause with differ that the Factors in disclaimer U.S. in actual filing to Protalix's are the described and the and Commission. Securities Exchange the I turn call will to Mr. now over Dror Bashan. Dror?

Dror Bashan

most begin and more detailed Thank Eyal I this everyone XXXX for our you, to commercialization financial a results start quarter following will open the And development recent provide of our second Global our line partner to the milestone welcome we progress will and and reviewing Chiesi And Rare my would by like our I results. together with impactful remarks Diseases. questions. accomplishments we then with and Chuck. will review quarter financial business update. achieved

that FDA European disease. treatment both much and the Commission U.S. very are adult patients We approved excited the for Fabry Elfabrio the of with

that million protein platform. payment we approval Chiesi highlights success unique the the significant from an milestone The received treatment for by patients And second further QX. achievement from disease. a quality the patients priority $XX of a affected options our life that for of expression has the system, Fabry Introducing is have approved which alternative ProCellEx, the Fabry improve the in potential drug is to and now families triggers our U.S.

Chiesi’s grateful for achievements. this dedication to contributed Chiesi. has continued the well We with to are been Protalix these greatly our journey as partnership as team very

presence they've launched and KOL space. up potential our rare the Elfabrio significant June, U.S. global diseases during activities the Chiesi full expertise the They've event of already poised and with in to discussed realize a within in we ramped As is commercial

launches opportunity addition, In in in significant Eyal to soon. represents alternative countries dollar disease need our market treatment and a a which And an we is billion building Fabry various prepared multi in will its in as in preparation elaborate carriers reflected financials Chiesi are for that inventory deliver. on of option. started

address And mentioned, sharing Mehta like As hosted would Ankit a drugs and June markets. in-depth event we New Dr. unmet on bringing the also to Giacomo I Protalix overview thank experience KOL rare of joining Chiesi his into Fabry in needs for disease in York City. the patients. thank Elfabrio could perspective us global Chiesi's for in just providing disease how We an and the

Protalix rare we and of the event, space. our future disease focus discussed the in also During our

We high Protalix regulatory of are are we needs well patients move to into phase equipped clinical, to committed therapeutic for And growth. the technical addressing expertise unmet and next options. with the with forward limited

provide will stage To an that very update our programs. I early now on end,

patients. uricase first-in-human designed PEGylated a is the treatment gout. Phase placebo-controlled, in immunogenicity dosed have The in of in New development patients. Enrollment the clinical to looking ascending double-blind, novel this is of patients trial, enrollment continued up are First, we been to a Zealand. safety, dose study dosing single and XX X XX reminder, in forward evaluate trial for of To and continuing. pharmacokinetics, PRX-XXX, is which in PRX-XXX date, is pharmacogenomics, and a as PRX-XXX study the And of conducted trial severe being to

next end quarter of of by year completed XXXX. this year, have will enrollment to be second final that We and the early expect by results

DNase's half-life for human recombinant to PRX-XXX, to treatment elongate NETs-related on process of DNase protein We in make PEGylated circulation a also designed continue diseases. I

conducted and look We look this as forward have providing to to to we demonstrate updates program preclinical on pipeline. PRX-XXX. our We others growing of feasibility build the studies and strengthen

cash with I balance will runway Eyal, maintain to near-term strong provides for capital sufficient to financials. infusion. the to current our need Finally, without please? now operations Eyal our sheet us turn review

Eyal Rubin

Dror you, today's and thank you, joining everyone, Thank for call.

Elfabrio. from revenues of Let $XX.X Chiesi of the months million resulted review EMA for from the The by June approval from and three during from Elfabrio. increase recognized three million goods the from increase, financials. The $XX.X Chiesi XXX% $XX services revenue of increase million or the June the months our me in months of connection $XX.X $X.X an or XX, of with quarter agreements. XXXX XX, an ended for XXXX. primarily ended an three XXXX. XX, revenues We R&D $X.X following second to to We connection comprised ended to of mentioned, XXXX, as million $XX of million the increase FDA for XXXX, Chiesi FDA three approval million compared license and in the Dror the services resulted million compared R&D with June sales increase $XX.X coming from of and regulatory ended XX, recorded primarily selling Revenues recorded revenues revenues in XXX% are license of million milestone of the the June months

substance and XXXX. with cost Authority Chiesi in The agreement. of Innovation June connection million sold of three sold the to Elfabrio XXXX, payable million June Chiesi the ended sold goods million Israel $X.X was three from the XX increase XX, of the the XX% months for or was result in increase goods months goods in royalties ended of of drug of for Cost of primarily increase sales cost an $X.X $X to

$X.X expenses approximately million subcontractor-related and three For $X.X salary of materials-related approximately research million million approximately June approximately total expenses. the other $X company's the months of XX, of and approximately ended related million, of $X.X $X.X comprised in XXXX, expenses, and were million expenses, expenses, development

million million compared XX, development months resulted of primarily regulatory $X.X program development the ended comprised million, and our to approximately approximately the development $X.X of ended and MAA research $X.X of XX% For and of decrease expenses. the related our June XXXX. Elfabrio months expenses, $X.X $X.X June were million expenses and for BLA salary the agencies. regulator XXXX and the expenses three $X.X by June material-based expenses was three million The research of decrease approximately completion or approximately subcontractor-related months to expenses, in other the and million research related review process XX, in total and total the XXXX, applicable XX, approximately the ended expenses, of Fabry clinical three The in related from

in for XXXX, The due the increase income months the $X.X from administrative net the increase million months to flows. rates million net XXXX XX, months $X.X The an XX, increase or to million and in $X.X ended primarily of for increase for million million were June $X.X as general of million. ended of expenses $X increase financial three our $X.X recognized of were to expenses notes-related primarily million gain Selling, notes an the a June June $X.X million net June well $X.X Financial XXXX. to for exchange of three resulted $X.X three of a convertible of compared ended months of compared million portion XXXX. increase onetime cost-related the XXXX, as three XX% approximately XX, cash expenses ended expenses XX, in from conversion of salary-related an a the resulted due an

result immediately primarily of approximately In the million, Section Tax taxes June development the year income Cuts and of XX, to went of expenses X, of taxes U.S.-based the capitalize incurred into the which effect Section of expenditures amortize U.S. current out XX XXX XXX deduct months and research and the years of the XXXX. requires in three on developments. which the and $X.X the in research ended Act XXXX, and XXXX, option these January were Jobs for recorded provision for over we respect eliminated to us

June benefit related of expenses to million. tax the released that allowance we to $X.X tax jurisdiction resulted valuation U.S. addition, of in XX, the In months during ended net a deferred XXXX, assets the three

Cash to and $X.XX $X.XX per XXXX, per and million $XX.X months million approximately June XX, approximately of diluted for same compared turn was per the at Net three the $XX.X cash share back call or basic you, June share the basic or in million net diluted for and $X.XX $X.X income equivalents to will were ended now XXXX. XX, share Dror. a I loss period XXXX.

Dror Bashan

Thank you, Eyal.

express call. gratitude my this So a company's in resulted entire exciting thank Protalix to tireless efforts for to joining I you, would have our the evolution. team, everyone, like note, whose personal the in today's time On

turning EU we around regulatory and certainly regulatory its had have challenges, significant Although company. progress made in towards in our path approvals has U.S., the the given the the recent approval

achievements We of so drive R&D are the the forward capabilities. our and patients focused the benefit strengthening to for I'm Protalix continue far families. year, and this confident of I'm proud now company their pipeline and we will the

I'll call back for Now and the open questions, operator the to your the line please. turn

Operator

[Operator you. Instructions]. Thank

Boobalan is Please Pachaiyappan Wainwright. H.C. with from Our first question proceed.

Boobalan Pachaiyappan

our Hi, questions. Dror much thanks so for talking

with Elfabrio. So to respect firstly,

So we launch launch provide you shareholder what like additional about would But to information the for can we from to drug a we be that, update pricing hear and understand activities. will preparation Chiesi or can maybe regarding when is when all the and responsible launched, maybe end, Protalix's hear?

Dror Bashan

that. for So thank you

of the is responsible -- commercial commercial company. Chiesi a is for I XXX% think, private as Chiesi activities. you the the for know, also

being now, And also It So It in public market. was a into in hope is once stock, just penetration more that Eyal be more will Right country the are product course. information, good share we into we'll will continue I as was is information, mentioned, This launched share information. I mentioned the by building able and we Europe. this to U.S. country approved. approved the of and briefly

the more these Chiesi. pleased So to in their once you we are quarters, doing financials partner. assure products patients. have we that are positive good through And committed of we share Chiesi, to they best very But We we very with can think are pleased priority and top will different I our with data, it are the in will they course. bring

Boobalan Pachaiyappan

With to respect hello, fair your you're study, Okay, enrolling PRX-XXX patients hear -- given ongoing gout so you me? enough. can

Dror Bashan

Yes.

Boobalan Pachaiyappan

Okay. there glitch. Alright, a sorry, was

level whether to and at ongoing UA who acid the of an acceptable patients given demonstrate elevated with PRX-XXX uric be levels, planning reduction respect to levels to would you're enrolling of gout study, your in curious also have the So meaningfulness treatment, clinical I'm end what acid measure XXX? just you're uric

Dror Bashan

there. have protocol strategy. think plan that it's over analyze least This -- we public. we have to subjects and at of suggest I we So the we in details finish this the clinical to to It's is I have all the The -- using, XX why to recruitment the up are have data. we trials

reducing suggest about for it's the evaluate see stage. the order to have in final levels clearly, I us but wait So results and next we in overall, hand for proceed and to we what the how

Boobalan Pachaiyappan

me. then great. final Okay, maybe And question one from

to and so with including because there trying clinical diseases, So rheumatoid NETs lupus, strategy arthritis, NET psoriasis multiple here respect so programs, your to I'm NET-related understand diseases, are on.

understand, to out particular your in of trying demonstrate the -- I'm for value proof drug, strategy? established concept with and development partner players of key So indication color here clinical this branch is the on one your clinical maybe any the to or

Dror Bashan

is rare And I years have, experience, to pathway we to in our we going is where disease may into outstanding strategy the if despite and we is two hurdles, will So refined our forward. focus agnostic. knowledge, this This value. of add products the years developmental we the the ProCellEx, on the our believe, fact This mentioned, and non-genetic scars And system, event and late all regulatory many successes, our and say, market, getting have space. we bringing have many believe June line. We also that forward. believe genetic through investor forward going we and going can finish of is I

is So intent. this the

commercial space. the and have disease we programs hands will commercial course, and and we platform now, right have to pipeline bring rare are With Now be hope to our the and we of don't right partner, in put to we to we now, succeed, regard are our with we still planned we within or -- modest. strengthen a to a stay small we -- will additional means, this, and

three it's products join certain down a consider a to will clearly then well, XX now. is we we years until stage, road, will then develop Hopefully, but to if the do can we may right partner. and ball plan have -- the say, consider two, a a part maybe and to not game. So this a forces with years X will different the we of, vision, I phase

Boobalan Pachaiyappan

time. so your thanks alright, Okay, for much

Dror Bashan

you. Thank

Operator

Please is proceed. Our Vandermosten John Zacks. with next from question

John Vandermosten

Thank you doing? you guys hello how are Dror, and Eyal,

Dror Bashan

are how you Good, John.

John Vandermosten

good. pretty doing am I

let for question studies a So potential future me on with start Elfabrio. any

that pediatric pediatrics would are there for And get completely be do considered? also, there think some I be these been well? it if Chiesi potentially a being trials, might Would mentioned had you -- Protalix study those for others. involved responsible trials and or especially of any as future know

Dror Bashan

our So again, product course, efforts. under with is and drug responsibility, rest to actually the agreement supply to responsibility plan Chiesi. including Chiesi, Chiesi's the The commercialization of medical to is the whole the

As a plan pretty deep plan with additional of it, they medical part do studies. long-term

well, requirement, women think mentioned, by study, FDA pediatric pregnant it's written the I you study, is public As it etcetera. as and

senior And be from will them for Chiesi view. So will initiated, will mean, you overall we can a ask I wait available, once data more but be it next to will that that it we fully in believe within of Chiesi I the X the is some the there I also approach Protalix with information point XX Chiesi them, and but suggest and -- with -- this developed not months, key responsibility. consulted are are employees is product, be consulting we, will Since executing Chiesi or medical very long-term we deep their plan. a be

John Vandermosten

for you Also, and I royalty product will the product in to continued work understand, of and inventory revenues from it guess, revenue side think, [indiscernible]. mean, the And up recognized, the what sense a through the those I Great, you revenues. million revenues. there's year like how XXXX? expect there, we I two as $XX the is that. components yeah, And so revenues milestone, want and into this there's how of then down, we that flow I rest Should flow trend they there's on far product your progress mean, revenues for the then will year? build then product thank and I the through will

Eyal Rubin

Eyal. John, So

Let elaborate. to me try

So first, milestones. royalties and in product, Elfabrio we the have

from We stream Elfabrio. have only two type revenue of

one is royalties and for the to XX% XX% royalties milestones, the first XX% obviously. the regulatory XX% outside outside U.S. to and the which the of U.S. top we The U.S., ranges conducted the obviously commercial have U.S. of and On lease in sales it, in both milestones,

from both anticipate that in was price, the pick their of royalty quarters, up for basically launched to recorded obviously, recorded. and we XX% U.S., and the state Chiesi quarter on that the in those at we've is out recorded. and the be agreement are countries, based which the product the we conservative the lowest discount works, to In as it product until we that even and the revenue least want terms Obviously, sRNA in in we're of what inventory, which price. this tier what we more than they to prepared up way are the we meaning we at go the the I them sales that are are reserve launch drug that public the have getting following and sales. applied next The of record obviously, they a U.S., sell since getting lease present for that's building basically level, the net this to case the the and royalties various

And stable the of ramping be that, going but we small is year, the see but in up towards revenue and that trend I next their definitely building going until be in to most that three story for to trend up increase company, be years a that to the projections in you're guess as of least of is guess quarter are the terms and or the really are us to the continue two of at up they for general the I to at provide to inventory means transparent. totally second are half changes the quarter don't changes next Chiesi projections, Again I growing their next In are inventory second that we're as as least inventory. that and be will in revenues operations. end revenues going a think and going inventory to beginning in Two Chiesi's is years well, different the see now, going obviously, going this ramping in towards year an from build. next in the year. the to three

John Vandermosten

through. a how and you mean, can for while the the I then won't be how a Perhaps revenue flow flows, would cash you but Okay. royalty us the if not for Great, a of us recognized give this, And the good that help sales Can time sure Chiesi the also to have cash of That's revenue sense flow third take in timing I'm until flows great. royalties happen will later. same answer. might at that quarter go the XXXX, be of understand and the recognition will sometimes Elfabrio?

Eyal Rubin

Sure.

fully described, is to so flow. the According also the Chiesi, us, we recognized which no it's no difference So there public, the as have and inventory there. almost minute they to that pay the the there's agreement, I to timing XX between cash is -- revenue drug gap Chiesi. timing to days And net revenue product the recognition is the sell

to in discount are we As move they that this of manner if applicable, at recorded, the play And the goes -- and the most with but that least I better. I mentioned, our we'll same books know since going revenues timely and we the cash recorded in as a sRNA forward, reserves at unknown, guess point, flows. we're the for

John Vandermosten

might how a compared similar should And difference? in margin. will the they gross or on is me for a expect range LOIs, so question gross in we to last then Elfabrio be And margin Okay.

Eyal Rubin

you're different game. different talking can that the looking industry, share case I a have take talking the about assume or this ball we Obviously, cut. back gross product. sell don't return that to I give getting gross the little the then we And between that Pfizer one-off That's I we margins on about think those check is can I -- this product, XX% but disclosing the very Brazil, XX% story a royalties big anywhere different like a the we reason to In margin that in biological -- complain. have but at margin drugs, any, Brazil, at Elfabrio, a Pfizer we're forget state In story But don't margins. the you not the That's of them with the guess again, also. small, if with sales. can point. you on that to at we're margin We sold do

John Vandermosten

you thank Okay, Eyal.

Dror Bashan

Thank you John, it. appreciate

Operator

Instructions]. [Operator

is Investor. Our Dar next Bashes, question Private from

Unidentified Analyst

morning. Good

you. a if the I revenue million, in that? was Just point primarily thank of $XX was from on or revenue there Elfabrio, the may, manufacturing royalty that clarification, revenue included

Eyal Rubin

the you Thank question. for

do So I as I It's explained, it mean, manufacturing. I'll not again.

on only streams have revenue of two We Elfabrio.

first resources their price. But a case that's around, guess to both in When two to next mentioned, turn we they sold of one obviously, the royalties or are will years commercial the market. it this is recorded inventory. percent milestones, obviously, as royalties point, Chiesi, The regulatory. and list that, Chiesi. second at finished I means They the be And and there's to while building so were the going sell a and at that we're is obviously one, to the the drive getting products the revenue, I

place. record is going real in minimal, is going future, of to calculation the drug to Chiesi. the to sales be And the to inventory we're going reconciliation start change the going we're then revenue once and be be That's recording. royalties going actually to to product taking So

Unidentified Analyst

Great, thank it. for Appreciate that you clarification.

Dror Bashan

you. Thank

Operator

the to at There I this time. questions Instructions]. over turn to more are would for [Operator management conference like comments. closing back no

Dror Bashan

next is Dror again, available continents company. patients to evolvement with Elfabrio this and forward the and time. and are So with their we the and -- have Happy both results of for looking like in the families, both Thank the you for their very much. to time. benefit speaking of you we very I'd thank everybody And that happy the

Operator

will today's conclude This Thank conference. you.

may your thank and time, You you lines this disconnect your at participation. for

Protalix BioTherapeutics (PLX) 7 Aug 232023 Q2 Earnings call transcript