OPKO Health(OPK) - 2024 Q1 - Quarterly Report

Financial Performance - Total revenues for the three months ended March 31, 2024, were $173.7 million, a decrease of 27$237.6 million for the same period in 2023[239] - The company recorded a consolidated loss from operations of $71.5 million for the three months ended March 31, 2024, compared to a loss of$30.6 million for the same period in 2023, representing a 134% increase in loss[239] - Total revenues for the three months ended March 31, 2024, were $46.8 million, a decrease of$58.4 million or 55.5% compared to $105.2 million in the same period of 2023[246] Revenue Breakdown - Revenue from services decreased by approximately$5.5 million, or 4.1%, primarily due to lower clinical test volume and reduced test reimbursement[240] - Revenue from products decreased by $2.3 million or 5.8$38.0 million, primarily due to declining international sales and foreign exchange fluctuations[247] - Revenue from the transfer of intellectual property and other dropped by $56.1 million or 86.5$8.7 million, largely due to one-time milestone payments received in 2023[248] Expenses - The cost of revenue for the three months ended March 31, 2024, decreased by $4.2 million, or 3.7$45.8 million for the three months ended March 31, 2024, down from $52.6 million in 2023[243] - Research and development expenses for the three months ended March 31, 2024, totaled$0.7 million, a decrease of 3.5% compared to $0.7 million in 2023[244] - Research and development expenses decreased by$10.6 million or 33.3% to $21.2 million, influenced by a one-time payment to Sanofi in 2023[251] - Selling, general and administrative expenses increased by$1.5 million or 11% to $15.0 million, driven by higher employee-related and professional expenses[250] Financing Activities - The company completed a private offering of$230 million aggregate principal amount of 3.75% Convertible Senior Notes due 2029, with net proceeds of approximately $222 million[232] - The company entered into a definitive agreement to sell select assets of BioReference for$237.5 million, expected to close in the second half of 2024[229] - The company completed a private offering of $230.0 million aggregate principal amount of 2029 Convertible Notes in January 2024[265] Cash and Liquidity - The company had cash and cash equivalents of approximately$75.6 million as of March 31, 2024, with cash used in operations amounting to $35.5 million[263] - Cash and cash equivalents on hand as of March 31, 2024, are deemed sufficient to meet anticipated cash requirements for operations and debt service beyond the next 12 months[277] Regulatory and Development Updates - The company anticipates regulatory approvals for Somatrogon (hGH-CTP) in over 50 markets, expanding its pharmaceutical pipeline[226] - ModeX was awarded a BARDA Contract for$59.0 million over five years to develop a next-generation MSTAR multispecific antibody against SARS-CoV-2, with potential additional funding of up to $109.6 million upon achieving milestones[270] - The company incurred$10.8 million in development costs related to the Epstein-Barr Virus vaccine, fully reimbursed by Merck[272] Currency and Interest Rate Management - Approximately 21.5% of the company's revenue for the three months ended March 31, 2024, was denominated in currencies other than the U.S. Dollar, up from 18.5% in the same period in 2023[236] - The company manages foreign currency exchange rate risk by entering into foreign exchange forward contracts to hedge forecasted cash flows[287] - The company does not hedge interest rate exposure due to the short-term nature of its investment portfolio, which is subject to minimal interest rate risk[289] Commitments and Obligations - As of March 31, 2024, total commitments under the amended credit agreement were $40.6 million, with$21.0 million drawn and a weighted average interest rate of approximately 7.8%[274] - As of March 31, 2024, the total contractual obligations amounted to $499.3 million, with$60.7 million due in the remaining nine months of 2024[279]