erus BioSciences(US:CHRS)2021-11-09 04:31Financial Data and Key Metrics Changes - For Q3 2021, the company reported a net loss of $38.5 million on a GAAP basis, with cash flow from operating activities at $13.7 million [21] - Net product revenue was $83 million, a decrease from $88 million in the previous quarter [21] - Cost of goods sold (COGS) as a percentage of net revenue increased due to a write-off of $5.2 million related to inventory that did not meet acceptance criteria, but is expected to decline in Q4 to the mid-teens [22][23] Business Line Data and Key Metrics Changes - UDENYCA net sales were $83 million in Q3, down 6% from Q2, driven by an 8% decline in units sold [16] - Market share for UDENYCA declined from 19% in Q2 to 18% in Q3, with losses primarily in 340B hospitals [16] - Research and development expenses increased to $54.1 million from $38.9 million in the same period last year, reflecting costs to advance the late-stage pipeline [24] Market Data and Key Metrics Changes - The pegfilgrastim market is expected to return to low single-digit growth in Q4 after a modest decline in Q3 [16] - The branded Lucentis market is projected to be $1.3 billion in 2021, with the company preparing to launch its biosimilar [19] Company Strategy and Development Direction - The company aims to launch four products within two years, with a focus on oncology expansion [7] - Plans to launch the UDENYCA on-body injector and biosimilar Lucentis directly upon FDA approval [17][19] - The company is preparing for the commercialization of toripalimab, which has potential as a first-line treatment for nasopharyngeal carcinoma [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the upcoming year, anticipating significant revenue growth from new product launches and a diversified portfolio [27][45] - The company expects to leverage existing commercial operations for new launches, which should lead to increased profitability in 2023 [45][47] Other Important Information - The company received an extension for enhanced Medicare reimbursement for UDENYCA through year-end 2022 [15] - The FDA has accepted multiple BLAs for the company's products, with target action dates set for 2022 [9][10] Q&A Session Summary Question: Revenue profile for UDENYCA on-body injector - Management declined to provide specific timing for the on-body injector launch but acknowledged the potential for significant market share capture from Neulasta OnPro [31][32] Question: Pricing and market evolution for PD-1 market - Management indicated that pricing strategies will evolve as the market becomes more competitive, with a focus on doublet and triplet combinations for immuno-oncology [41][43] Question: Timing of profitability - Management believes 2023 will be a pivotal year for profitability as the diversified portfolio comes online [45][47] Question: UDENYCA business and competitive landscape - Management noted that competitive pricing pressures may lead to continued price declines in 2022, but they are focusing on higher-margin segments [51] Question: Lucentis biosimilar market strategy - The company plans to target high-volume Lucentis users while also considering the broader VEGF market [60]