erus BioSciences(CHRS) - 2020 Q3 - Quarterly Report

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS This section warns that forward-looking statements involve substantial risks and uncertainties, advising against undue reliance as actual results may differ materially - Forward-looking statements involve substantial risks and uncertainties concerning business, operations, and financial performance[10] - Key areas of uncertainty include UDENYCA® sales, biosimilar candidate development (bevacizumab, adalimumab, ranibizumab, aflibercept), regulatory approvals, market size, financial performance, and COVID-19 impact[10][12] - Actual results may differ materially from current expectations due to factors discussed under Part II, Item 1A. Risk Factors[13] PART I. FINANCIAL INFORMATION ITEM 1. Unaudited Condensed Consolidated Financial Statements This section presents Coherus BioSciences' unaudited condensed consolidated financial statements, prepared under U.S. GAAP, detailing financial position and performance Condensed Consolidated Balance Sheets These balance sheets present the company's financial position, detailing assets, liabilities, and stockholders' equity as of September 30, 2020, and December 31, 2019 | Metric | Sep 30, 2020 (unaudited) | Dec 31, 2019 | | :----- | :----------------------- | :----------- | | Assets | | | | Cash and cash equivalents | $292,465 | $177,668 | | Investments in marketable securities | $210,966 | $0 | | Total current assets | $726,920 | $343,009 | | Total assets | $803,733 | $408,927 | | Liabilities | | | | Total current liabilities | $133,432 | $114,969 | | Convertible notes due 2026 | $222,718 | $0 | | Total liabilities | $548,002 | $303,713 | | Stockholders' Equity | | | | Total stockholders' equity | $255,731 | $105,214 | | Accumulated deficit | $(772,462) | $(894,998) | - Total assets increased significantly from $408.9 million at December 31, 2019, to $803.7 million at September 30, 2020[16] - Total liabilities also increased substantially from $303.7 million to $548.0 million, primarily due to the issuance of Convertible Notes due 2026[16] Condensed Consolidated Statements of Operations These statements present the company's financial performance for the three and nine months ended September 30, 2020, and 2019, detailing revenue, operating expenses, and net income | Metric | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :----- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net product revenue | $113,551 | $111,684 | $365,405 | $232,215 | | Cost of goods sold | $9,000 | $6,447 | $25,994 | $9,273 | | Research and development | $38,851 | $21,568 | $98,131 | $59,240 | | Selling, general and administrative | $31,984 | $31,828 | $101,386 | $100,967 | | Income from operations | $33,716 | $51,841 | $139,894 | $62,735 | | Net income | $27,933 | $47,043 | $122,536 | $50,606 | | Basic EPS | $0.39 | $0.67 | $1.72 | $0.73 | | Diluted EPS | $0.33 | $0.63 | $1.52 | $0.69 | - Net product revenue increased by $1.9 million (1.7%) for the three months and by $133.2 million (57.4%) for the nine months ended September 30, 2020, compared to the respective prior periods[22] - Research and development expenses increased significantly by $17.3 million (80.1%) for the three months and $38.9 million (65.7%) for the nine months ended September 30, 2020, reflecting increased pipeline activities[22] - Net income for the three months ended September 30, 2020, decreased to $27.9 million from $47.0 million in 2019, while for the nine months, it increased to $122.5 million from $50.6 million[21] Condensed Consolidated Statements of Comprehensive Income This statement details comprehensive income components, including net income and other comprehensive income (loss) items like unrealized gains on available-for-sale securities | Metric | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :----- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income | $27,933 | $47,043 | $122,536 | $50,606 | | Unrealized gain on available-for-sale securities, net of tax | $6 | $0 | $18 | $0 | | Foreign currency translation adjustments, net of tax | $(4) | $59 | $285 | $(170) | | Comprehensive income | $27,935 | $47,102 | $122,839 | $50,436 | - Comprehensive income for the nine months ended September 30, 2020, was $122.8 million, a significant increase from $50.4 million in the prior year, primarily driven by higher net income[24] Condensed Consolidated Statements of Stockholders' Equity These statements track changes in stockholders' equity over the three and nine months ended September 30, 2020, and 2019, including common stock issuances and net income | Date | Total Stockholders' Equity | | :--- | :------------------------- | | Dec 31, 2019 | $105,214 | | Sep 30, 2020 | $255,731 | - Total stockholders' equity increased from $105.2 million at December 31, 2019, to $255.7 million at September 30, 2020, largely due to net income and additional paid-in capital[28] - Accumulated deficit decreased from $(894.9) million to $(772.4) million, reflecting the company's profitability during the period[28] Condensed Consolidated Statements of Cash Flows This statement provides a breakdown of cash flows from operating, investing, and financing activities for the nine months ended September 30, 2020, and 2019 | Metric | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :----- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $121,021 | $10,645 | | Net cash used in investing activities | $(224,457) | $(6,670) | | Net cash provided by financing activities | $218,433 | $88,170 | | Net increase in cash, cash equivalents and restricted cash | $114,997 | $91,975 | | Cash, cash equivalents and restricted cash at end of period | $292,905 | $165,166 | - Net cash provided by operating activities significantly increased to $121.0 million for the nine months ended September 30, 2020, from $10.6 million in the prior year[37] - Investing activities show a substantial increase in cash used, primarily due to purchases of marketable securities ($273.8 million) and license fee payments ($7.5 million)[37] - Financing activities provided $218.4 million, largely driven by proceeds from the issuance of 2026 Convertible Notes ($222.2 million)[37] Notes to Condensed Consolidated Financial Statements These notes provide detailed explanations and disclosures for the figures presented in the condensed consolidated financial statements, covering