Jazz Pharmaceuticals(JAZZ) - 2024 Q3 - Quarterly Results

Third Quarter 2024 Financial Results and Highlights Key Highlights Jazz Pharmaceuticals achieved record Q3 2024 revenues exceeding $1.05 billion, driven by key growth products and affirmed full-year guidance with raised EPS forecasts and significant pipeline advancements - Key growth drivers (Xywav, Epidiolex, Rylaze) collectively grew 14% year-over-year[1][3] Updated 2024 Financial Guidance Highlights | Guidance Metric | 2024 Outlook | | :--- | :--- | | Total Revenue | $4.0 to $4.1 billion (Affirmed) | | Oncology Revenue | $1.08 to $1.13 billion (Lowered) | | Non-GAAP R&D Expense | $790 to $830 million (Lowered) | | GAAP EPS | $6.70 to $8.50 (Raised) | | Non-GAAP EPS | $19.50 to $20.60 (Raised) | - Key pipeline milestones include the zanidatamab PDUFA target action date of November 29, 2024, for 2L BTC and a planned sNDA submission for Zepzelca in 1L ES-SCLC in the first half of 2025[1][2][3] Business and Pipeline Updates Commercial Updates The commercial portfolio showed robust Q3 2024 performance, with Xywav and Epidiolex leading growth, while Xyrem declines were offset by authorized generic royalties Xywav Xywav net product sales increased 17% to $388.5 million in Q3 2024, adding approximately 400 new patients for a total of 13,625 active patients Xywav Q3 2024 Performance | Metric | Value | | :--- | :--- | | Net Product Sales | $388.5 million | | YoY Growth | +17% | | Net Patient Additions | ~400 | | Total Active Patients | ~13,625 | Xyrem and AG Royalties Xyrem net product sales declined 54% to $58.1 million in Q3 2024, offset by $58.2 million in high-sodium oxybate authorized generic royalties Xyrem & AG Royalties Q3 2024 (vs Q3 2023) | Product/Revenue Stream | Q3 2024 Sales | YoY Change | | :--- | :--- | :--- | | Xyrem Net Sales | $58.1 million | -54% | | High-Sodium Oxybate AG Royalties | $58.2 million | +$29.2 million | Epidiolex/Epidyolex Epidiolex/Epidyolex net product sales grew 18% year-over-year to $251.6 million in Q3 2024, with approvals in over 35 countries - Epidiolex/Epidyolex net product sales reached $251.6 million in Q3 2024, an 18% increase compared to Q3 2023[5] Rylaze/Enrylaze Rylaze/Enrylaze net sales decreased 6% to $98.8 million in Q3 2024 due to temporary protocol updates, with normalization expected by early 2025 - Rylaze revenue was temporarily impacted by an update to pediatric ALL protocols, with demand expected to normalize by early 2025[6] Zepzelca Zepzelca net sales grew 10% to $85.8 million in Q3 2024, with positive Phase 3 results supporting a planned sNDA submission in 1L ES-SCLC by mid-2025 - Based on positive Phase 3 results in 1L ES-SCLC, the company plans to submit an sNDA for Zepzelca in the first half of 2025[6] Key Pipeline Highlights The pipeline is advancing, with zanidatamab granted FDA Priority Review for 2L BTC, targeting a PDUFA date of November 29, 2024, and further data readouts planned for 2025 Zanidatamab Zanidatamab is under FDA Priority Review for BTC with a November 29, 2024, PDUFA date, and anticipates Q4 2024 launch, with further trial data expected in 2025 - The FDA granted Priority Review for zanidatamab in 2L BTC, with a PDUFA target action date of November 29, 2024[7] - Top-line data from the pivotal HERIZON-GEA-01 trial for zanidatamab in 1L GEA is expected in Q2 2025[7] - A new Phase 2 pan-tumor trial (DiscovHER-Pan-206) has been initiated to evaluate zanidatamab in HER2-positive solid tumors[7] Financial Performance Financial Highlights (Q3 2024) Jazz Pharmaceuticals achieved total revenues of $1.055 billion in Q3 2024, a 9% increase, with GAAP net income reaching $215.1 million and non-GAAP adjusted net income $416.9 million Q3 2024 vs. Q3 2023 Financial Highlights (in thousands, except per share) | Metric | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Total Revenues | $1,054,969 | $972,140 | | GAAP Net Income | $215,055 | $146,820 | | Non-GAAP Adjusted Net Income | $416,924 | $340,148 | | GAAP EPS (diluted) | $3.42 | $2.14 | | Non-GAAP Adjusted EPS (diluted) | $6.61 | $4.84 | Total Revenues Total revenues increased 9% to $1.055 billion in Q3 2024, driven by 8% growth in Neuroscience revenue and 9% growth in Oncology net product sales Q3 2024 Revenue Breakdown (in thousands) | Segment / Product | Q3 2024 Revenue | Q3 2023 Revenue | | :--- | :--- | :--- | | Total Neuroscience | $702,724 | $675,081 | | Xywav | $388,466 | $331,633 | | Epidiolex/Epidyolex | $251,558 | $213,711 | | Xyrem | $58,114 | $125,110 | | Total Oncology | $284,754 | $260,410 | | Rylaze/Enrylaze | $98,780 | $104,859 | | Zepzelca | $85,843 | $77,994 | | Defitelio/defibrotide | $65,818 | $47,730 | | High-sodium oxybate AG royalty | $58,157 | $28,921 | | Total Revenues | $1,054,969 | $972,140 | Operating Expenses and Effective Tax Rate Q3 2024 GAAP R&D expenses decreased to $199.9 million, while GAAP SG&A expenses increased to $325.8 million, resulting in a GAAP effective tax rate of (7.2%) Q3 2024 vs. Q3 2023 Operating Expenses (GAAP, in thousands) | Expense Line | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Cost of product sales | $111,611 | $102,153 | | Selling, general and administrative | $325,772 | $308,310 | | Research and development | $199,919 | $234,402 | - The decrease in R&D expenses was primarily due to lower clinical program costs for JZP150 and zanidatamab[18] - The increase in SG&A expenses was primarily due to increased compensation-related expenses driven by higher headcount to support key growth drivers[17] Cash Flow and Balance Sheet As of September 30, 2024, Jazz held $2.6 billion in cash and investments, with $6.2 billion in long-term debt, generating $997.3 million in cash from operations year-to-date Key Financial Position Data (as of Sep 30, 2024) | Metric | Value | | :--- | :--- | | Cash, cash equivalents and investments | $2.6 billion | | Long-term debt (principal balance) | $6.2 billion | | Cash from operations (YTD) | $997.3 million | Senior Notes Offering and Share Repurchases In Q3 2024, the company completed a $1.0 billion private placement of exchangeable senior notes and repurchased approximately $150.0 million of its ordinary shares - Completed a private placement of $1.0 billion aggregate principal amount of 3.125% exchangeable senior notes due 2030[8] - Concurrently repurchased approximately $150.0 million of its ordinary shares as part of its share repurchase program[8] 2024 Financial Guidance Updated Full-Year 2024 Guidance Jazz Pharmaceuticals affirmed full-year 2024 total revenue guidance at $4.0 to $4.1 billion, while raising GAAP and non-GAAP EPS guidance due to strategic pipeline prioritization Full-Year 2024 Guidance Update (in millions, except per share amounts) | Metric | Updated Guidance (Nov 6, 2024) | Previous Guidance (Jul 31, 2024) | | :--- | :--- | :--- | | Total Revenues | $4,000 - $4,100 | $4,000 - $4,100 | | Oncology Revenue | $1,080 - $1,130 | $1,100 - $1,180 | | GAAP R&D Expenses | $862 - $908 | $887 - $935 | | Non-GAAP R&D Expenses | $790 - $830 | $810 - $850 | | GAAP Net Income per Diluted Share | $6.70 - $8.50 | $6.00 - $8.00 | | Non-GAAP Net Income per Diluted Share | $19.50 - $20.60 | $19.20 - $20.30 | Supplementary Information Conference Call Details This section provides logistical details for the investor conference call and webcast held on November 6, 2024, to discuss Q3 2024 financial results - An investor conference call and webcast were scheduled for 4:30 p.m. ET on November 6, 2024, to discuss Q3 results[26] Non-GAAP Financial Measures Explanation The company utilizes non-GAAP financial measures to supplement GAAP results, providing investors and management with enhanced insights into operating trends and performance - The company uses non-GAAP financial measures to supplement GAAP results, facilitating better analysis of operating trends and period-to-period comparisons for investors and management[30][31] Forward-Looking Statements This section contains forward-looking statements regarding growth, financial guidance, and pipeline, subject to significant risks and uncertainties that may cause actual results to differ materially - The report contains forward-looking statements concerning financial guidance, pipeline development (e.g., Zepzelca sNDA, zanidatamab launch), and commercial expectations, which are subject to significant risks and uncertainties[34][35][37] Detailed Financial Statements and Reconciliations This section provides detailed unaudited consolidated financial statements for Q3 2024 and 2023, including Statements of Operations, Balance Sheets, and Cash Flows, along with GAAP to non-GAAP reconciliations - The report includes detailed unaudited Consolidated Statements of Operations, Balance Sheets, and Statements of Cash Flows[39][41][42] - Provides comprehensive reconciliations of GAAP reported financial information to non-GAAP adjusted information for historical periods and for 2024 financial guidance[44][46][52]