Orchard Therapeutics plc(US:ORTX)2023-11-13 12:10Financial Performance - For the nine months ended September 30, 2023, the company reported net losses of $65.0 million compared to $142.8 million for the same period in 2022, with an accumulated deficit of $965.9 million as of September 30, 2023[125]. - Product revenue for Q3 2023 was $5,559 million, an increase of $182 million (3.4%) compared to Q3 2022's $5,377 million[151]. - Collaboration revenue rose to $743 million in Q3 2023 from $400 million in Q3 2022, marking a significant increase of $343 million (85.8%)[151]. - Total revenues for Q3 2023 reached $6,302 million, up $525 million (9.1%) from $5,777 million in Q3 2022[151]. - For the nine months ended September 30, 2023, total revenues were $14,853 million, a decrease of $816 million (5.2%) compared to $15,669 million in the same period of 2022[161]. - Net product revenues for the nine months ended September 30, 2023, decreased by $1,473 million (10.4%) to $12,744 million from $14,217 million in 2022[162]. - Net loss attributable to ordinary shareholders improved to $(35,319) million in Q3 2023, a reduction of $12,246 million (25.7%) from $(47,565) million in Q3 2022[151]. Expenses and Costs - Total costs and operating expenses for the nine months ended September 30, 2023, were $85,278 million, down $25,887 million (23.3%) from $111,165 million in 2022[161]. - Research and development expenses decreased by $3,550 million (19.6%) from $18,103 million in Q3 2022 to $14,553 million in Q3 2023[155]. - Selling, general and administrative expenses slightly increased by $113 million (1%) from $11,496 million in Q3 2022 to $11,609 million in Q3 2023[157]. - Total direct research and development expenses decreased from $32.2 million in 2022 to $23.3 million in 2023, a reduction of $8.8 million or -27%[165]. - Total indirect research and development expenses decreased from $36.1 million in 2022 to $23.9 million in 2023, a reduction of $12.2 million or -34%[166]. - Selling, general and administrative expenses decreased from $38.5 million in 2022 to $33.7 million in 2023, a reduction of $4.8 million or -12%[167]. Cash and Financing - The company had cash, cash equivalents, and marketable securities totaling $125.4 million as of September 30, 2023[125]. - Net cash used in operating activities was $81.2 million in 2023, compared to $63.9 million in 2022[177]. - Net cash used in investing activities was $24.5 million in 2023, primarily due to purchases of marketable securities totaling $146.7 million[180]. - Net cash provided by financing activities was $60.1 million in 2023, mainly from private placement financing of $68.0 million[182]. - The company expects existing cash and marketable securities will be sufficient to fund operations for at least twelve months from the filing date[184]. - The company has borrowed $33.0 million under its credit facility, with a carrying value of term loans at $25.6 million and a variable interest rate of 5.95% plus SOFR[191]. Strategic Developments - The company entered into a Transaction Agreement with Kyowa Kirin on October 5, 2023, for the acquisition of its entire issued and outstanding share capital, with a cash payment of $16.00 per ADS and contingent value rights[127][128]. - The FDA has set a Prescription Drug User Fee Act (PDUFA) action date of March 18, 2024, for the biologics license application (BLA) of OTL-200, which is currently under review[127][131]. - The marketing authorization for Strimvelis was transferred to Fondazione Telethon on July 17, 2023, and the company will no longer recognize revenue from Strimvelis sales[132][135]. - The company expects to continue incurring significant expenses and increasing operating losses for the foreseeable future, necessitating substantial additional funding if the transaction with Kyowa Kirin does not close[126]. - The company is advancing a pipeline of HSC gene therapies aimed at addressing serious diseases with limited treatment options[123]. - The company plans to expand its global footprint by qualifying leading centers with transplant and disease area expertise and enabling patient identification through diagnostics initiatives[127]. - The company aims to grow its sales, marketing, and distribution infrastructure for the commercialization of Libmeldy in Europe[39]. - The company plans to develop and implement in-house manufacturing operations and facilities[39]. - The company is focused on expanding its intellectual property portfolio and complying with public company obligations[39]. Currency and Interest - The company recorded net realized and unrealized foreign currency losses of $4.5 million for the three months ended September 30, 2023, compared to $22.8 million for the same period in 2022[192]. - For the nine months ended September 30, 2023, the company recorded net realized foreign currency gains of $3.0 million, contrasting with losses of $47.1 million for the same period in 2022[192]. - The company does not currently engage in currency hedging activities but may consider using foreign currency forward and swap contracts in the future[194]. - Interest income increased significantly to $3,925 million for the nine months ended September 30, 2023, compared to $686 million in 2022, an increase of $3,239 million (472.5%) due to rising interest rates[161]. - Interest expense increased to $2.9 million in 2023 from $2.1 million in 2022, while interest income rose to $3.9 million from $0.7 million[169]. Accounting Policies - There have been no material changes to the company's critical accounting policies since December 31, 2022, except for the addition of the derivative liabilities policy[186]. - The company has classified PIPE Warrants and PIPE Units as liability instruments, impacting the financial statements based on fair value assessments[187].