HALO - Earnings call transcript Q4 2020 | Halozyme Therapeutics, Inc.

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Halozyme Fourth Quarter 2020 Financial Results Conference Call. At this time all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to turn the conference over to Al Kildani, Vice President of Investor Relations and Corporate Communications for Halozyme Therapeutics. Mr. begin. please Kildani,

Al Kildani

afternoon full Good to fourth our Thank XXXX and financial and year results quarter you. welcome conference call.

our Financial review business; find presentation website. Chief provide Leading In close, the Investor an Dr. on to press financial call of will today in issued and Sun addition the Helen our and section after today's you who call can will Elaine will a Torley, that slide fourth the will Relations Executive full Halozyme's supplementary Officer, Officer, be referenced release our the results for year Chief President our on our who and quarter update XXXX. be

making turn During to the listing refer statements. of I our the Helen. and a the will you I'll uncertainties. call full call risks be over now forward-looking SEC we to filings for

Helen Torley

year you, XXXX. we tremendous of growth marked for as XXXX Thank which momentum enter created Al. strong a has Halozyme,

review me Total brief Let earnings XXXX XXXX within revenue and were XXXX XX% per with financial in and $XXX.X our share performance. recent share range. $X.XX. guidance revenues begin million, our were per from Both up a of earnings the most were

since with and the subcutaneous into Therapeutics in development development; of a signing version year share ,including the significant in driven challenge XXXX the our Europe; Our progress capital of a Commission two Roche's the in growth a to a thanks DARZALEX X progress captured of of as that the of results a return remarkable form repurchases for against partner execution share we DARZALEX our DARZALEX, product pipeline transformational number subcutaneous of ENHANZE a develop ENHANZE-based during for in prospects, and revenue the million of achieved of multiple XXXX which global products, expansion new to of partners, potential work for the plan suppliers million SC is pipeline uptake return moving to program, royalty products expansion by resulting able known the years. Halozyme the upcoming of and $XXX approvals were TEPEZZA; our in Phesgo; three-year strong in approvals and $XXX was $XXX partnership subcutaneous a navigate, repurchases of the total November our Board U.S. The long-term and dedication accomplishments. financial and saw of provides This backdrop our the enhanced pandemic, COVID the included European DARZALEX to employees. we million in These of continued XXXX. confidence for FASPRO FDA hard ways Horizon launches strong in potential and as anticipate two growth including two of Janssen Phase authorized

XXXX. to now Moving

contribution represent of guidance to to expected revenues royalty expect an expected our deals. potential to that XX% We would Recall $X.XX which $XXX of would revenue. of of any $XXX million, in new doubling XX% driven not XX%. from growth GAAP to XX%, million per does share growth by include earnings represent $X.XX The primarily ENHANZE

for strong This turn and royalty in both subcutaneous growth doubling is our royalty by In to DARZALEX a we three projected growth. me now Let revenue slide revenues. discussion driven XXXX, of Phesgo.

XXXX full XX% on of the royalties sequentially. from the outside DARZALEX FASPRO illustrated by in U.S. the XX% in U.S. $XX.X million. and of launch growth saw in revenue grew As resulted year left-hand revenue propelled the SC we and quarter DARZALEX was fourth royalty chart, the This and year-over-year

adoption by For already penetration around and driven launched growth XXXX, project continue, we and the SC markets the FASPRO DARZALEX will and launches ongoing additional DARZALEX world. in by

the U.S. growth project For and launches European penetration the the adoption following XXXX. increased December approval of start in driven of in by robust and Commission European the XXXX, in we also Phesgo by

key strong royalty our year DARZALEX now the XXXX project XXXX that in high-margin that the portion remain where will full subcutaneous is Phesgo. higher the recurring with fastest-growing a revenue we of position, revenues is also at of We're substantially driver the launch, than For a level segment.

turn slide me our and X I'll products. Let highlight now key to commercialized

have We technology. approved five now and in both our US the utilizing products ENHANZE Europe,

the provide Let with me launches, DARZALEX. now subcutaneous two on our representing product launches, some color most beginning recent wave

including DARZALEX, SC XX% year-over-year quarter, of and the $X.XX forms & billion, an fourth worldwide sales Johnson Janssen's on operational During reported parent the Johnson of up IV basis.

drug utilizing months While after between data the that in overall the form States version. we XX% J&J Symphony XXXX, the form and of a from a share IV subcutaneous of not can five of subcutaneous Health approval, of on May by DARZALEX sales of ENHANZE, share sales does just United was the the October breakdown provide based

indicated the and accelerated confirmatory subcutaneous for there's there's in the and Consistent opportunities a a with And this approval this In and accelerated for and value with subcutaneous the myeloma approval, fast of patients, sales this newly version And FASPRO. approved bring the with from Japan diagnosed of of include potential in launch Chain therapy I for will to is with in Janssen dexamethasone. for also used remarkably Light being patients. the uptake also pomalidomide of in Chain bortezomib is of conduct Light treatment made adults the These indication with the in proposition countries potential at for in following utilizing the one expansion available dexamethasone US while use cyclophosphamide prior approval the Europe. to growth of patients. have of expectations form an DARZALEX are European potential line impressive additionally, DARZALEX think approval the XXXX subcutaneous trial, additional DARZALEX and subcutaneous indication, approval Supporting for it's you'll agree growth therapy. US can US ENHANZE potential in Amyloidosis, newly really new FDA who combination the myeloma for that January in relapsed potential the approvals multiple and refractory Amyloidosis for or DARZALEX. multiple launches speaks the and least indication received patients

launch start, the and in revenue we you such DARZALEX franchise expanding why subcutaneous for anticipation the to of be growth and With can a for high see DARZALEX growth the strong Halozyme. of expect geographies, overall DARZALEX indications strong subcutaneous driver a off

eight begin Herceptin, quarter of of Let launched in expected me fixed-dose five to Europe approved for Roche's was XXXX. is antibodies compared the to IV was This in hours needed of is minutes in Perjeta the versions. XXXX the late a move States during of administered now Phesgo first which Phesgo. and to in with in combination several two launch quarter to the third United and December,

XX CHF For the Roche reported fourth sales of Phesgo quarter, approximately million.

beginning to XXXX. sales in in increased Halozyme expectation launch in in and European of the we and QX the royalty use Phesgo adoption the contribution United and With strong growth anticipate States,

made Let five me partner development BMS potential expected an move products prioritization the future now will with us Phase we now nivolumab, June expansion informed a our they've of our recently of target to discussion study of the portfolio predict by for ENHANZE in with Bristol-Myers not to that Phase X of technology. utilizing study retain CTLA-X ENHANZE pipeline and a initiated to five Squibb development I/II study. combination In of of slide commercialized a the starts. end the new on products, decision study. I XXXX, portfolio. portfolio Building ipilimumab XXXX, BMS the XX the continue

studies a enhanced of In launches into III. progress time the technology end utilizing addition, of total This we result XXXX. of occurring separate would are XXXX. III our in Phase the anticipate four launches Phase currently by in evaluated form window lines XXXX products seven development being products in that Phase to potential two in I Phase will Based on time four Halozyme's III three indication with these wave potential the products historical

in have launches development believe In pipeline will revenues, flow XX this products addition, long-term historical advancing in development the of if wave the completed products or utilizing of I be to product and project ENHANZE XXXX. we growth potential progress, multiple in would XXXX setting Based four is programs cash lines future Phase development that products time the window profitability. up of these on for ways form deliver these We launch will potential with will XXXX. launches time in XX

XXX argenx, Let just signing. now me is now for really reached of with month, is four patients of Argenx achieved key and SC after this assessment ADHERE that with or Earlier had the support which a subcutaneous evaluating efgartigimod registration from the and potential conducting four Phase go deal to polyneuropathy inflammatory the give decision X trials Beginning trial, a feat programs. two efficacy chronic argenx in brief efgartigimod. years treatment include partner-by-partner plans ENHANZE demyelinating and discussion CIDP. will approximately in it’s This for less than comments safety CIDP. continue remarkable enrollment of indications now for planned of to efgartigimod

the the XXXX, met in the quarter myasthenia in gravis positive or SC announced from earlier bridging the form argenx for with IV in efgartigimod its XXXX, MG. FDA Recall fourth of discuss efgartigimod evaluating MG. to potential During argenx of study results for ADAPT a that trial,

forward fourth with painful SC its program. moving blistering. X argenx with barrier argenx foliaceus, to a ENHANZE trial and Following fast to pemphigus X continues thrombocytopenic indication Argenx initiated which for are path a pertuzumab enable vulgaris its evaluating trial trial skin two also a potential Phase feedback, with FDA FCF recently associated And immune focused small in serious ADDRESS is with with diseases also Phase in designed efgartigimod. registration

one analysts are to product, frame, wave in and three We time argenx could multibillion-dollar have project exciting this which of be is the with which delighted to potential. XXXX our working XXXX on launches potential

This nominated be is in study Phase data of for is evaluated target, argenx to with planned and Multifocal in a which Motor to is initiated mid-XXXX. healthy Moving treatment X volunteers ARGX-XXX recently targets ARGX-XXX. Neuropathy. CX expected in the second evaluated being

to expect in subcutaneous the to receive of milestone a payment study. the this component related near-term We

with potential adjust drugs may of accommodating utilizing in care. sites to patient a just you've of not heard, always subcutaneous patients argenx where the new its normal indications the with of clinic to broad of ENHANZE, and rapid evaluating As easy goal all making forms progress access to preference is the have range

projects. During I'll our six a we licensing expand up with to delighted to of the were to and argenx now to move quarter, include Roche. agreement now total collaboration fourth

also Roche Phase or locally wave quarter, fourth patients. This metastatic is the lung product. a previously in three dosed cell X cancer first our non-small payment launch Tecentriq the trial During evaluating of treated potential one advanced in

study, addition, In SC with of its or Ocrevus Phase with administration continues ENHANZE. evaluating I Roche ocrelizumab

Janssen. to Moving

the amivantamab, a of ENHANZE XXXX, November MET of in subcutaneous launch In antibody solid addition form Phase Janssen study EGFR to DARZALEX X with a in tumors. successful and of advanced initiated bispecific

ENHANZE to TEPEZZA, with providing with use one the formulation for Therapeutics. two an develop of target intends access IGF-XR. In of an of serious These we of ENHANZE in clinical five set We're with selection continuing move $XX of indicated as is Horizon collaboration Moving disease, with medicines agreement of Phase milestone for milestones. SC and studies four anti-CDXX SC on anticipated has studies, rare monotherapy targeting of Bristol a with exciting clinical forward Horizon, billion a eye is partner, of available with progressive upfront now combination to vision-threatening an publicly in is according $X.X newest announced autoimmune to SC formulations has nivolumab Bristol-Myers XX and treatment million. Squibb. and the We of X studies Horizon Horizon payment ENHANZE. having to received SC one well an and which immuno-oncology thyroid potential exclusive Horizon. to future our a as BMS and subcutaneous pleased franchise The I'll disease. peak our look sales collaboration to targets. of include TEPEZZA licensing sensory. subcutaneous November, signed studies relatlimab,

potential Our expanding future multiple from long-term see growth. setting sources. ways Furthermore, is pipeline additional drive of that up approvals two maturing growth we potential future revenue launches can to and and continue

companies. where we sales to broad have slate biotech a ENHANZE with pharma new discussions is first of both continue and The

while sign we're them too. through opportunity And second predict. additional for clinic. and difficult advancing ever, is to more available, our As we will to growth the the timing than I'm deals confident open timing, of here With growth slots current as source new excited the that exists into nominating partners XX the is targets

to three-year milestone and revenues growth years. all our drive coming XXXX, bars of the of prior years. X two the XXXX outlook in projected in strong to years in ENHANZE portfolio comparable the is each projected is outlet presented the as well blue Now our Slide on over growth in the progress three the that from as in next milestone Illustrated we

well we're the in projections. against these shown green bars, performing As

in we growth million For a revenues. $XXX to $XXX project our XXXX through million the showing continued milestone XXXX, in of progression milestones

for our non near-term this royalty project revenue is milestone -- and potential important billion a in projections an to royalty revenue $X We have based Slide on approximately return. revenues. assuming future of indications. Now and risk-adjusted for strong indicator revenue XXXX programs and line approach value currently global creation now sales all to to discuss capital our turn to I'll of we sight in revenue X

strategy. We have internal return balance flow anticipate cash capital support longer and will We allocation strong driven the ongoing growth. share by to as priorities projected ENHANZE commitment and strong as well term capital free M&A both three maintaining a our external repurchases sheet, cash our

million progress million program, have As made share $XXX to-date. mentioned earlier, completed repurchase year with our $XXX three with we strong

We pending market in worth and factors. up repurchasing million to common XXXX other target will $XXX conditions shares of

the fourth still In its capabilities. technology create Halozyme's potential growth of the quarter proven addition, the extending I'll ENHANZE year goal for accelerating value cycle, for And expansion the discussion technologies selective. and for through full long-term with opportunity incremental update, in over platform see with to evaluate platform and be continue partnering highly other We we to Elaine we that results. a the and new opportunity XXXX commercialization have call With now financial to revenue to applying of early turn growth. acquisitions

Elaine Sun

Thanks very Helen. much

of revenues. quarter our Slide to me fourth review turn for a X Let

prior revenue indicated, compared fourth Helen million quarter on US the plans saw an XXX% biologics as establish Total strong period. $XX.X $XXX.X execute continue again growth increase the in to to their was to delivered the commercial our quarter, and for we As of development partners million, in subcutaneously and the in year globally.

ENHANZE the million, from releases an period. from $XX.X mature moment year the sales Horizon driven a agreement growth subcutaneous key take our in the of programs upfront the more by Growth product impact sales subcutaneous up driven Therapeutics and by $XX strong with prior support primarily API XX% period, in product to from year fourth growth. of totaled million, of XX% in was our legacy in launched This the for million payment newest continued period our And Roche's now sales was $XX.X $XX.X revenue of November the the utilizing products increase million. of quarter, discuss prior manufacturing over me signing drivers additional a of partner in up year to partner a quarter. million Growth from license royalty $XX.X collaboration TEPEZZA. of DARZALEX of for result quarter Let partners' and some the develop million royalties Janssen. in the subcutaneous primarily the in as overall our offsetting DARZALEX and Product partner Revenue products was the Phesgo the $XX quarter the newly by partner prior of drove uptake were in royalties revenue product. collaboration

Let more to for our detailed X me a P&L. turn of breakdown quarter fourth Slide

And of of our grew million XXXX this were million XXXX API which So product year in a business year. royalties $XX.X with which collaborative in I'll in our completed. revenue million partner operating prior million. in from XXX% following results. operating share in share an the to total quarter million a million our prior $X.X just our And the $X.XX full a were to in in declined compared our With Cost and and already as the fourth above collaboration significant operating COGS off in million quarter of slightly range sales quarter support base. in excluding and was That from with Slide our quarter. expenses $XX generated $XX.X launches. for business year the development the year million the start $XX to significantly with for level in net SG&A model million leverageable operating fourth a of And now highly the revenues activities period. and income the restructuring operating million $XX.X of And the resulted in was million the Product quarter that, launch model sales and our loss higher net reduction November XXXX. was million due Helen most PEGPHXX has development XXXX. $XXX XXXX. were in $XX.X markedly overall from revenues recent XXXX. down of with or for income PEGPHXX-related partners' million guidance range of the as of December the the that prior net of the in Cash, to And grew of which drove year in product decrease in fourth respect over year Furthermore, in result XXXX million year With Total prior million increase loss year for down million we focus an were with XX, described, the discontinuation were EPS driven upcoming collaboration progress in cash $X.XX API of year end model our of share income of force products million in of versus increase shift year with decrease of $XXX.X ENHANZE-only The estimated XX% primarily prior $XX.X to restructuring. million to with in operating that been compared a and securities loss compared Halozyme for by to for expenses million, was per XXXX at our per the with period. compared of partners XXXX. net quarter, substantial period reflects the expenses quarter and of $XX.X fourth $XX.X Horizon, XXXX. And million, for total to an to a prior sales $XX.X loss higher period. strategic in marketable for pipeline million expenses equivalents sales with our given for leverageable the million, $XX.X of $X.XX snapshot in decreased operating the repurchases let related excluding to million substantial me to position. revenues XX increase year, COGS were fourth Research completed operating compared of income expenses in the we compared or below programs to XX% $XX.X loss with have $XXX.X year $XX at XX% date. turn readiness share biggest of million led Total $XXX.X to $XX.X expenses $X.XX $XX.X of $XX.X and XXXX. year $XXX.X per from November This record drug million contributor oncology and period XX% compared compared prior a the an $XX.X attributable the the in the expenses at business $XX.X $XX the cash a of support year loss within to for halting the XX% the

financial which Now financials. on quarters based guidance Slide report results. non-GAAP XX discussion our is both I'll turn We and financial to GAAP in of future XXXX plan to a GAAP for

and based for from is information year. Our planned expenditures the partners guidance our the our on latest

year-over-year revenues represent million XX%. total expect of growth million, $XXX XX% to $XXX We to which would of

the components revenues. Let of me to speak

to We expect levels. XXXX from double royalties revenues from

XXXX goods, between EPS purposes commercial our to which in to and sales modeling calculation. clinical note that API increase We modest is expected we XXXX to new just XXXX milestones. revenue driven $XX levels And expect primarily range by important product Total product bulk model. sales will OpEx to sales operating for by million business levels with this in trial from expect XX% driven factor $XX higher COGS to will the regard higher cost be substantially increase a I the in an our be collaborations strong as starts would from of further excluding in similar your leverage of million and expect illustrates that of partners. We commensurately the XX% expenses, under range total and result

XX% moving $X.XX, XXXX We and And and expect which over million, over income of the earnings to would of to to GAAP represent million $XXX be per XX% for to growth operating in between share, EPS represent $XXX range projecting which $X.XX are we XXXX. to growth XX% would XX% XXXX.

to remain we committed shareholders. returning to reviewed, capital Helen As

to $XX We and continue this which year under other will we for common available $XXX factors market our current of up that repurchase repurchases to million in share conditions expect would worth remaining authorization. million our pending shares stock leave

that that million like would launched subject is turn note the portion that of release corporate the principal does to in $XXX let of we offering And I an repurchase to share press announced we put notes afternoon. XXXX, encourage the Please notes convertible conditions our a buybacks in the X.XX% corporate closing, just Before have earnings Helen. me I XXXX. senior or of with referenced. the our out call outstanding due release use now offering market -- contemplate proceeds would due this of also to and review convertible we the I that press And back intended amount proceeds exchange remainder general of for of not current everyone note to today guidance to that this and And purposes. call aggregate the

Helen Torley

Elaine. you, Thank

strongest close will on and sustainable our coming shareholders, XX. to long-term allow maintain on the value. a We quarters to ever developing As outlook Halozyme revenues I'll in profitability capital look company. you cash just us return in as to which growth slide to strong and the forward heard with flow commitment the coupled and deliver place financial shareholder growth position years, in our pipeline maximize

year similarly are expected with impactful Halozyme, that While value-creating be events XXXX XX. transformative for was and several a listed slide important to XXXX is on clearly

continue FASPRO and approval SC in Europe in two European expect Commission grow also December XXXX. We to XXXX. the the of approval Japan DARZALEX potentially in to momentum there DARZALEX And the in the based Phesgo also we and potential accelerate on expect US wave momentum and to launch with following for continue

now thanks my the the your everyone thank send Halozyme. program the would possible for through to the of these products. We attention work XX platform to-date result all continue our expect and in for new phase delighted and we And indications. products X new three. programs into X to ongoing return two you None collaboration that the targets your phase please will repurchase million And team phase mix to to to five as I'd we'd we like long-term wave continue call. X launches future And to acquire project share will new do enter four we're and $XXX can separate be progress a recall just today potential And new I sincere to will Operator, advance a without seven results. across seek and of to progress, resulting to agreements capital in We take amazing of our strong this questions. sign form shareholders these development. in growth. revenue a to X position phase this everybody starts be resulting at open to add in terrific

Operator

Duncan is Sir, Our of open. from line Cantor [Operator the first your line Charles Fitzgerald. Instructions] from comes question

Charles Duncan

good Hi, Elaine, you Helen our quarter. team. a questions. and for and on And taking very thank Congratulations

Helen Torley

you. Thank

Charles Duncan

on increasingly So, wave seems this first and also the of is story to on least I'm on it selected Helen by question three. argenx. wondering I'm is DARZALEX. And us targets become the subcu for wondering how efgartigimod. argenx large about may the going like remind last? efgartigimod and at of long new just ask to call wanted that It's it that were if you I not kind an and And of could IP part strategy

Helen Torley

to for the will receive of that. we efgartigimod that working XX We after Charles. agree, continue We certainly royalty for the revenues Halozyme, to that question pushing patent products definitely issued it royalties co-formulation that or the the effect is IP-related out for the royalty in a one in of of there duration Thanks to with so first commercial is for are if today. even ever sales based longer range could years our exciting Yes. -- the regard have on than most the portfolio indications

So, place, too efgartigimod remaining soon commercial patents just would reminder a to about our no talk if Charles. first years for on co-formulation based sale. but XX get are a the for the step term, from there that the patents it's And in last for of as frame a certainly contracts, half down we to royalty after end But time to original very XX-year exciting the of rate patent the remaining the story ahead in efgartigimod.

Charles Duncan

it's patents. too formulation talk about early guess That's And core I to helpful.

come you. so And we'll back to

you have might be. to regarding six collaboration that six could disclosed if or I argenx any question to color -- new second the targets. point wondering The been And targets where is I guess those had to if as I'm us provide up or

Helen Torley

Yes.

So, Charles. far the of targets they've selected two just

FcRn CX the and target. target So, the

as forward And look first obviously, and to targets. to beyond and are continuing work targets, we we nominations that but CX. interest in to yet identify FcRn the additional to argenx additional So, they two collaboration announce very up no expanding to with strong six already gratified signaled the

Charles Duncan

new Okay. queue that I'll in Last back question collaborations. the on and then hop is and

one collaborations year? you on deal. the new imagine being to the or team visibility there And that on productive TEPEZZA Would capacity increased progress the that this with very November been Horizon You've current SC perhaps then and year? version with bring do two have per you

Helen Torley

Yes.

lean the So, into commented we indicate to back we that and start done this think on the with Elaine meeting think regard at where if get partners, our can they're her hard they new We've certainly to add support I prepared expect stages to working TEPEZZA, Halozyme remarks. of to at with in and JPMorgan, regard development. With clinic Horizon leverageable have collaboration. certainly individuals for did steady our XXXX. a different mentioned We a kickoff that what ability and multiple CEO partners in collaboration believe can model at business I do

would of products significant expansion I need a to in so if in -- people expansion And we've see we expansion number we the significant said of in that number the a clinic the only or a were of partners. modest

the targets. number current the is years big and we next the of a in operating estimate a So, for partners see good unless expense expansion several

Charles Duncan

good. Very Thanks the Congas. for color. Great quarter.

Helen Torley

Appreciate Thanks Charles. that.

Operator

comes Do question of from BMO. the Kim from line next Your

line Your is open.

Do Kim

congrats you. Hi, DARZALEX to FASPRO, wanted according provided metric the Good the about US share for ask afternoon on the Health. XX% you thank first I and Symphony to quarter.

Just assume to understand I aligns royalties reliable how and for in And that your with you're receiving your is FASPRO? it -- want what mind? data

Helen Torley

can I that general about talk Yes. Do. terms in

for We seeing. of reported are we and any So in yes, numbers, why us we're with think there's overall -- seeing receiving. this see well the is is I royalty performance triangulate we revenues it it. a does that with we're these from the always do correlation syndicate news good an the adjustment numbers but the reported the

Do Kim

you FASPRO those that for Are dynamics conversion? uptake you differences DARZALEX to between there think the can Or in how in and on seeing US? launch should or similar that And compares are Phesgo therapies? comment about we two the

Helen Torley

Yes.

as they the speed with will FASPRO gate revenues out on expectations our for DARZALEX of has exceeded has Roche as And fast think what reported to the as getting United Phesgo, FASPRO. not DARZALEX their say based States. are I that in the overall adoption I

get of that So expected of logistics focusing couple we key for always would be the place. quarters they XXXX the in Phesgo there all while initial

on XXXX uploaded to we where getting really that So records. was reimbursement the working robust see uptake. electronic And getting it always would like that expectation our starting be on formularies Phesgo medical things

we're I so revenues US spending, to now beginning poised well And as penetration think only which nicely from that see to for very in is as more greater Europe, launch. the coming

launch. year DARZALEX a will out we good for personally than gate think got this there. any Phesgo faster So the growth FASPRO believe I of I've seen. be strong

royalty two the it But revenues. Phesgo will to very and driver -- the So we're to as that mentioned they are see our going I dominant going a dynamics as just from from contribution momentum though. continue nice of well be

Do Kim

question you. Last financials. Thank That makes sense. Okay. the on

when on bottom you an fourth R&D in expenses to see spending it XXXX, or we the XXXX, reductions seems SG&A? see year spending Just the in Where should in expenses. back expect guidance, operating look for growth in your you of into we when increase operating quarter maybe the for a at should the based that of

Helen Torley

Yes.

to turn over Elaine one me that Let to answer.

Elaine Sun

what and the reflects XXXX generally OpEx the say range. XXXX, is obviously in of total of on I ability excluding Do restructuring sort our about with we and to being focus is talked $XX can OpEx, down breakdown of between $XX the in within significantly So, That's we've And OpEx provide breakdown partners. our OpEx programs for COGS, following million for but and don't of terms million again multiple consistent ENHANZE-only sort support products the business. the to

our be of out able see support to products business ENHANZE-only programs. to again good leverage model. should And continue and that we'll multiple So

course, be XXXX. there new or a Helen expansion should the number time. and for Of good expansion partners But programs over could some with number that's significant some that be as over of in growth indicated, time inflation

Do Kim

Great, taking questions broadly. thanks for as my

Operator

question next Jim from comes Birchenough line of from Your Wells the Fargo.

open. is line Your

Jim Birchenough

Yes. Hi, guys.

year. a my Let quarter few me. guess the questions congratulations me I add for on and the

-- note the convertible offering. note the on First

that completely and and I've if expect some And to of you of the be could in X.XX% notes. the then the on suggestion portion Just replaced timing, shares that and follow-up terms questions. that you'll cash some also mix maybe you exchange? in And got of there's just exchange the comment do

Helen Torley

Yes.

what can Let in she address that to Jim. Elaine answer me ask

Elaine Sun

Sure.

for offering. press can't I sheet specifically corporate new would We've notes. much about the talked share to too But speak and I well Jim, we the under repurchase convertible right purposes. of authorization convertible our about proceeds in to balance existing discuss for you refer of board general $XXX of release. strengthening an a notes outstanding unfortunately, being use as our offering So buybacks portion you're million as did our

specifics refer speak you I'd unfortunately, that So to press I can't than release. to more just our

Jim Birchenough

that and experience guidance to or how on or doubling range take assumptions a you and Elaine the royalties based it of be? prior that guides Is speak trying guidance? Thanks may end the in And based look do not on that royalties lower in just that it Is And maybe the the that. range Just if could Europe? in you you've for Is at terms estimates? midpoint? conservative Okay. consensus guides of feedback with understand launches or underlying XXXX, your what to Helen what partners? just for from and the that doubling of then got

Helen Torley

want you do to Elaine, that? address

Elaine Sun

Sure.

as we take mentioned. account, those all into So Jim you factors

with a have close our We partners. very relationship

alignment potential organization management team, frankly programs alliance sort the potential regularly across timing our get -- of Our the and and partners to and outlook of with regularly products. the around discuss and for meet

So et outlook from look from cetera, research also well. at at like we'll our look the We sales look statistics market we and at analysts take royalty We estimate. groups both Symphony partners. as

-- that notably our factors our those that Janssen, Phesgo drivers including but into there the substantial And will we've obviously partner XXXX. gives Roche's all growth. of products, of in would taking DARZALEX us I mentioned be growth anticipate obviously are recently partners, launched So with clearly consideration, that some close think very and we confidence interactions

Jim Birchenough

final And Terrific. I'll jump in just queue. maybe back one the question,

can as terms look versus launch on say of if do thinking that. indications, If Maybe two seven about to comment you just products could comparable about anything two? the across wave bigger? in think it's wave that -- qualitatively, three we Just four waves up, you think different you coming wave do how about wave at of or you

Helen Torley

Yes.

mentioned as dollars. we are we two as earlier excited we're of potential multibillion about well as know about analysts those ones their obviously very first efgartigimod, are includes Each Tecentriq. project clearly launches The that and

attractive very established X are year additional enter that can So, also will large well this products two the we believe exciting markets and say I qualitatively, as Jim. Phase blockbuster just products

strong So there, on execution and of in obviously two wave the exciting three. well. portfolio wave exciting as a launches potential of wave group very it's focus And that's very a but wave is three

Jim Birchenough

taking Terrific. the Okay. for questions. Thanks

Helen Torley

Thank you.

Operator

question next Fye of comes Jessica from from Your line the JPMorgan.

is open. Your line

Unidentified Analyst

for questions. Jess. follow-up guys. Hey, on -- my for Thanks taking is This Luke

for And launch at to underway, be just driven royalty of for of So XXXX sort substantially long revs the expect you an expect to do getting comments gotten comparing when your that over look the sort equal be more Or do fast long on at FASPRO given start that's to Is you out or US? the higher you as just you Phesgo than you just EU gate? just noted term Phesgo. you the say term, then expect that that is would persist? dynamic of more level them dynamic looking how has the of same FASPRO to

Helen Torley

that Elaine, would address question? to Yes. you like

Elaine Sun

sure. I say, would

a very in expect DARZALEX, DARZALEX and XXXX. talked So in we've we about see XXXX we FASPRO and as continued growth meaningful seen subcu as growth in we've

we've as Phesgo year think sort of was formulary with EMR. I a getting access and about staging XXXX of talked reimbursement

in we meaningful And so XXXX. growth with those now place anticipate in do

end addition in you XXXX Europe. of the out they point approval at as to rightly In received the

growth a from also driver of we and see so, FASPRO. being And Europe sales increasing royalty

Unidentified Analyst

TEPEZZA give them trials of MG Tecentriq launching guys granularity could to then on for registration Okay. any potential III that one. efgartigimod noted than like; any is they the beyond earlier and And the timing like Phase that maybe to release And that given path formulations? candidates you ongoing for there between just for come these and file for in rapid XXXX you SC then today? XXXX the just pursuit another potentially Can more

Helen Torley

human. Yes. the been from years of really I with X wave to on our standard them come we for to XXXX being will timeframe based is time the in which lines when estimate XXXX it three launches up the say X.X has first in

some regard we smaller you Phase if shorter those with a I that for launch to efgartigimod so and have earlier. unknowns. example the still point faster made a mean are could potentially reason able an to it were potentially much line think time to as And III could

plan benchmark. can't dynamic But obviously Phase so III get we just readout. is any there conservatively a the there. can so provide We data potential on we more And and granularity our to

Our partners haven't that. provided

in a not we're it. to share So position

of there some But If unfortunately always get as date. would you you you completion take as granularity specific look trials.gov estimates But completion clinical any we talk partners date. until would those their the a about primary can't provide know at as we estimated like. aren't

Unidentified Analyst

question. Thanks for taking right. All my

Helen Torley

you. Thank

Operator

JMP question from next the of line comes Our from Securities. Jason Butler

open. is line Your

Unidentified Analyst

you in I in guys offering with the do of Roy but or you -- thoughts valuation on have maybe What it's maybe think any on expect for are maybe a guys post days there? of AstraZeneca? Thanks. right M&A lot had convertible you seeing a Have Alexion. And that how taking the what environment out kind a the Jason. the follow-up Or questions. What five XQ? buybacks. there? closing are seeing you potential dividend? assets last conversations you you so notwithstanding, had about Thanks any thinking for our guess Hi, Then and tie are I a then that now? couple you do Do

Helen Torley

Yes.

Elaine so that's me dividend. the I AZ we Let absolutely, have ask the talk Roy. Alexion close are of we conversation those and would post there awaiting think the a to I'll about take just before and close two

out still unique things the being of to today. what's we're platforms want looking see do we're where where see the and some what to in think deliver But able out to M&A, I phase can For type interesting evaluating are Halozyme's to there. still the -- we and assessment the able play company we over There above there. is talents right

analyzing So looking. question? ENHANZE. we're that you strong the address we assessing and feel do for definitely and an but would growth given the don't to in But us And area for Elaine of see hurry actively we any active dividend interest ahead

Elaine Sun

Sure, happy to.

cash remain committed Roy, would we So just generation I capital profitability flow and strong growth say diversified and our return. with portfolio to

this would through way the XXXX. about million buyback buying of that of for our $XXX X/X we've to of much which million in up a plan capital year leave under we're share very about to have focused as know X-year you we million form of return buyback respect a midst think $XX I talked the plan. common $XXX on with little and buybacks. We're stock And

say decisions strong With While that, the frankly beyond companies of company to would we its return. share buyback be strong with tends is being again, versus of to sort of growth. I remain mode return still have would with to say buyback, say early forward respect respect dividend we going would would I company to method made I in committed of ENHANZE no cycle, say potential. capital I with share kind with a or the that capital growth growth

again no about -- so And of the of decisions kind while made we authorization. we beyond sort current

strong for continue share appropriate capital not strong method only believe but return to capital that the with buyback cash flow also prospects. -- generation, we growth company is think a of I

Unidentified Analyst

Thank Okay. you.

Operator

Capital. the next line comes of Your from Anita question Dushyanth from Berenberg

Your line open. is

Anita Dushyanth

afternoon, Good Elaine. Hi. Helen question. Thank and for my you taking

there going Considering of the about eventually And IV couple COVID talk if a rate-limiting these from also reformulated better-than-expected this despite rate more to uptake any? is step regarding environment, you setting? fast SC, Just growth the therapies of is conversion an the could here. potential process, in in-home moving there the to a

Helen Torley

that regard be at two Takeda's which today With to approved the Phesgo in-home home. for HYQVIA, is products also And that setting. we setting, are was approved product. would for have right. And actually the All in-home

no a risk possibility the think given perhaps to of that that if at no home. is there is got I a or profile a reactions. infusion-related There about could those think products way be is product hypersensitivity safety reactions has good

without at professional. health supervision. be given by home is care the HYQVIA themselves given a Phesgo to patient Now actually needs with

So moving you're something. forward, I to think on

talked And a we're to expensive home. patient depend on setting. is administer care really more and be aid perhaps themselves we're actually to with to want will being whether the it I or definitely think at to in about home. of but see where with move that profile, Argenx I the that it's developed seeing least has efgartigimod safety the the going care able products health to around it trend think world the a the professional, people given

So key a I that think enabler be going very to be of to wave. that is excited ENHANZE we're And of wave. part

subcu. community down inertia over hopefully, suite. years conversion data patients a Other perhaps XX% an to like the frankly a that from of of rate physician of we've which there's prefer ultimate sometimes proportion that And who going impact seen are X% that just subcu, factors of conversion to in can to so that rate be dynamics we've small can are the with shown seen number IV slow from that helpful, IV the IV to For into the of of that's infusion But Those always There's and the Anita. patients. the goes those sometimes can amount the subcu. which than couple it at and that.

Anita Dushyanth

Yes. That's helpful. Thank me. you. And just two more for

think Phesgo? should launch Phesgo European for be to the see uptick to in about region, the the logicists we then the like Regarding the about and QX of month set we time possibly up a of or most

Helen Torley

the Phesgo, over that's say on for a to different for process years we can the each experience but major to companies. XX get on based European It in the months of all launch. between with markets different of And European them launches can take have reimbursed. nine So has to any specifics drug don't because actually I

following quarter example, to reimbursement because UK can XX countries France take approval, like of happen and can nine the first quickly depending but Germany process. within months -- their sometimes As of on

in all the the have large period. nine growing of countries Spain course launch France a a to countries a early, a bit more countries to being with of rollout much through expect to staggered the XX-month But couple France, the So with that gradual we the end of pattern, year. the more of Europe it some is see in like year closer just towards being of of but

Anita Dushyanth

thank and And more. you. Okay, just one

Regarding oncology relationship complementary with to be partners? acquisition technology, the neurology in it would space likely autoimmune a leverage current of existing

Helen Torley

platform, able would be it's because indications, into it different their for across portfolios. Ideally And early leading multiple utility integrate little are We to of platform be form we are companies actually platform and that for because looking a some to different a disease that going that add looking technology to states and a say. would we're have companies. to license can

any to can different applied got threshold neurology. and like disease drugs so areas, goal in with to out And capability, certainly of with disease it work a autoimmune technology of the to not all but do be area. ourselves oncology that Think hasn't disease or specific or more brings we're it ENHANZE, setting sorts a to disease and it because enabling restrict anything a is

Anita Dushyanth

Okay. for Thank all will be helpful. That's me. you. That

Helen Torley

Thank Okay. you.

Operator

line Citi. of Joel Your from the from next comes question Beatty

open. is line Your

Benjamin Paluch

selected. of eventually the target? greater Benjamin is name must or a on a terms at looks Joel. is does question partner the I'm are which targets point target then XX not for a A XX It for clock My like a curious, selected? be to quick Paluch deal still this there us. if impact select Hello. how is And than a

Helen Torley

Actually of are different. time contracts a general the for all in of targets there overall, is their period a long But, our partners of little pretty all agreement. to term select within

our with into move And so to forward partners and the we're portfolios actively clinic. current at working as we mentioned the in their prepared to new remarks look each identify of targets

Benjamin Paluch

then you. Thank Great. And last one question.

So this pertains to argenx.

bridging moving So that for study, programs? other how you. with Thank ENHANZE with for the important argenx forward presented is

Helen Torley

bridging. can our would form the so have look at date Roche products I of of all who to got we a have partners market, Janssen say, and with it commercialized with in used

partners bit a an approach I argenx little and endpoint. previous different have pharmacokinetics is whereas the think efficacy our used what using a about they're endpoint, is pharmacodynamic -- a

in insofar so which is And a level up a it it reduction setting IgG the efficacy. as for is is surrogate precedent the

have is that allows using of itself it's frankly is And of because the in approval parameter. to So to is time bridging rapid development all our be from that's pharmacodynamic five first years it what what and one setting using very they're standpoint. to done. of approach The But precedent a X.X bridging. partners this

Operator

comes Shim Genuity. last the Your Ben of from line question from Canaccord

Your line open. is

Ben Shim

far? milestones? give Can and your has so been What the if Apologies, strong for a very Thanks everybody. in for earned what question revenue And my I've congratulations Hi guidance you on on us results. color are little collaborative taking missed this. assumptions for XXXX? more

Helen Torley

over I'll one Elaine. All to right, that turn

Elaine Sun

Sure.

haven't have comparable indicated what further a milestones provided collaborations that anticipating milestone breakdown we're the is we payments. from we in So level as of we But of had XXXX.

And note for guidance the our new so I excludes just potential any that -- deals. ENHANZE would and

new ENHANZE So exclude payments any it would partnership. a potential from upfront

Ben Shim

Elaine, you communicated notes? for for have And for outstanding accounting EPS forward? previously you us be I more convertible the remind guidance your can couple you A Okay. Do what issue. you intentions will think XX maybe the treatment going similar note for the any

Helen Torley

Yes. Elaine, like would you to address that?

Elaine Sun

Sure.

cannot proposed I to speak I'd So to back to the -- current release. refer the our you offering. press just

our existing would proposed that, outstanding the to other the I'd we're would our to is analyst And our $XX I in of think expense I we estimates converts. think interest think have non-cash. say I specifics shares the that million annual addressing respect with on converts that nature one say, varied, dilutive what probably little of shares, the I the there. has about that what things the can that of I refer I I P&L, we underlying any is on And EPS. you variance with diluted that's accounting of of And diluted think to a existing And with is the estimates transaction. terms add-back of are XX-K, release. an non-cash assume you I our press may roughly associated consensus expense. for and may XXXX-XX is million convertible early you in adopt As of say which can ASU that recall interest that resulted in to noted bit And have with have expecting also have just of think $XX on

Ben Shim

on Okay. and Thank you congrats helpful very a much. quarter. That’s very

Helen Torley

Thank you.

Elaine Sun

Ben. you, Thank

Helen Torley

everybody right. see thank your just that, at today. All I to Well, time. I want attention we're really for

impactful XXXX, which a for and which heard us of progress has set was story performance tremendous Halozyme up a similarly You've XXXX. in

speaking thanks very we So look much for Bye-bye. forward you. Thank to And attention. next your quarter.

Operator

conference call. concludes Ladies you today's Thank for participating. and this gentlemen,

now disconnect. may You

Halozyme Therapeutics (HALO) 24 Feb 212020 Q4 Earnings call transcript