2009 Press Releases
Onyx Pharmaceuticals Reports Second Quarter 2009 Financial Results; Nexavar Global Net Sales Reach $201 Million, 19% Increase Over Second Quarter 2008
Strong Topline Growth for Nexavar Drives Continued Profitability
Emeryville, CA. — Aug. 04, 2009
Onyx Pharmaceuticals, Inc. (NASDAQ: ONXX) today reported its financial results for the second quarter 2009. Global Nexavar net sales as reported by Onyx’s collaborator Bayer HealthCare Pharmaceuticals, or Bayer, were $201.0 million for the second quarter 2009, a 19% increase compared to $168.5 million in the same period in 2008. Onyx and Bayer are marketing and developing Nexavar® (sorafenib) tablets, an anticancer therapy currently approved for the treatment of liver cancer and advanced kidney cancer in the U.S., European Union, Japan and other territories.
Onyx reported non-GAAP net income, excluding employee stock-based compensation expense, of $15.3 million, or $0.27 per diluted share, for the second quarter 2009 compared to non-GAAP net income of $8.7 million, or $0.15 per diluted share for the same period in 2008. Net income for the second quarter 2009 was primarily driven by higher Nexavar sales offset by the company’s expanded clinical development efforts, increased commercial costs to support the brand and lower investment income due to current macroeconomic conditions. On a GAAP basis Onyx reported net income of $9.4 million, or $0.16 per diluted share, for the second quarter 2009 compared to net income of $4.5 million, or $0.08 per diluted share, in the same period in 2008. A description of the non-GAAP calculations and reconciliation to comparable GAAP measures is provided in the accompanying table entitled “Reconciliation of GAAP to Non-GAAP Net Income.”
“Excellent Nexavar sales performance is driving bottom-line growth and, together, these results demonstrate our continued success in building a strong business foundation for Onyx,” said N. Anthony Coles, M.D., president and chief executive officer of Onyx. “Importantly, statistically significant data recently reported from our large randomized Phase 2 breast cancer trial support our belief that Nexavar has the potential to become a standard of care across a variety of additional tumor types. We believe that our growing commercial business, compelling clinical program, and strong development pipeline position Onyx to continue to grow and build value on a sustainable basis.”
Revenue from Collaboration Agreement
For the second quarter 2009, Onyx reported revenue from its Nexavar collaboration agreement of $60.2 million compared to $45.1 million for the same period in 2008. The 34% increase in revenue from collaboration agreement between periods resulted from an increase in Nexavar sales and royalty revenue and a decrease in Nexavar commercial expenses.
Onyx recorded research and development expenses of $28.0 million in the second quarter 2009, compared to $23.5 million for the same period in 2008. Higher research and development expenses in the second quarter 2009 were primarily due to planned increases in the development program for Nexavar across additional tumor types, such as colorectal cancer and adjuvant liver cancer, and Onyx’s costs to further develop ONX 0801. Research and development expenses included $1.1 million and $0.8 million of employee stock-based compensation expense for the second quarter of 2009 and 2008, respectively. Selling, general and administrative expenses were $23.5 million in the second quarter 2009, compared to $19.8 million for the same period in 2008. Higher selling, general and administrative expenses were primarily due to headcount-related expenses to support Onyx’s growth. Selling, general and administrative expenses included $4.8 million and $3.4 million of employee stock-based compensation expense for the second quarter 2009 and 2008, respectively.
Investment income was $1.0 million for the second quarter 2009 compared to $2.7 million in the same period in 2008. The decrease was primarily due to lower effective interest rates as a result of market conditions as well as a change in the asset allocation of Onyx’s investment portfolio.
Cash, Cash Equivalents and Marketable Securities
At June 30, 2009, cash, cash equivalents, and current and noncurrent marketable securities were $469.5 million, compared to $458.0 million at December 31, 2008. This increase was primarily due to cash provided by operations.
Nexavar net sales, as recorded by Bayer, were $379.1 million and $320.4 million for the six months ended June 30, 2009 and 2008, respectively. Excluding employee stock-based compensation expense, non-GAAP net income for the six months ended June 30, 2009 was $23.4 million, or $0.41 per diluted share, compared to non-GAAP net income of $29.4 million, or $0.52 per diluted share for the same period in 2008. A description of the non-GAAP calculations is provided below in the accompanying table entitled “Reconciliation of GAAP to Non-GAAP Net Income.” For the six months ended June 30, 2009, on a GAAP basis Onyx recorded net income of $13.4 million, or $0.24 per diluted share, compared with a net income of $19.9 million, or $0.35 per diluted share, for the same period in 2008.
Management Conference Call Today
Onyx will host a teleconference and webcast to provide a general business overview and discuss financial results. The event will begin at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) on August 4, 2009. The live webcast will be available at:
or by dialing 847-413-3362 and using the passcode 24875257. A replay of the presentation will be available on the Onyx website or by dialing 630-652-3044 and using the passcode 24875257 later in the day. The replay will be available through September 4, 2009.
About Onyx Pharmaceuticals, Inc.
Onyx Pharmaceuticals, Inc. is a biopharmaceutical company committed to improving the lives of people with cancer. The company, in collaboration with Bayer HealthCare Pharmaceuticals, is developing and marketing Nexavar® (sorafenib) tablets, a small molecule drug. Nexavar is currently approved for the treatment of liver cancer and advanced kidney cancer. Additionally, Nexavar is being investigated in several ongoing trials in a variety of tumor types. For more information about Onyx, visit http://www.onyx-pharm.com.
Nexavar® (sorafenib) tablets is a registered trademark of Bayer HealthCare Pharmaceuticals.
This news release contains "forward-looking statements" of Onyx within the meaning of the federal securities laws. These forward-looking statements include, without limitation, statements regarding sales trends and commercial activities and the timing, progress and results of clinical development, regulatory filings and actions. These statements are subject to risks and uncertainties that could cause actual results and events to differ materially from those anticipated, including, but not limited to, risks and uncertainties related to: Nexavar being our only approved product; competition; failures or delays in our clinical trials; dependence on our collaborative relationship with Bayer; market acceptance and the rate of adoption of our products; pharmaceutical pricing and reimbursement pressures; serious adverse side effects, if they are associated with Nexavar; government regulation; possible failure to realize the anticipated benefits of business acquisitions or strategic investments; protection of our intellectual property; and product liability risks. Reference should be made to Onyx's Annual Report on Form 10-K for the year ended December 31, 2008, filed with the Securities and Exchange Commission, under the heading "Risk Factors" for a more detailed description of these and other risks, as well as the company’s subsequent quarterly reports on Form 10 Q. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this release. Onyx undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date of this release except as required by law.