Document
false0001159036 0001159036 2020-08-10 2020-08-10



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________________________________
FORM 8-K
_____________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported):
 
August 10, 2020
HALOZYME THERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
________________________
Commission File Number 001-32335
Delaware
 
88-0488686
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
 
 
11388 Sorrento Valley Road
 
92121
San Diego
 
(Zip Code)
California
 
 
(Address of principal executive offices)
 
 
(858) 794-8889
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.001 par value
HALO
The Nasdaq Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ( §230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 ( §240.12b-2 of this chapter).         
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 





Item 2.02 Results of Operations and Financial Condition.
On August 10, 2020, Halozyme Therapeutics, Inc. issued a press release to report its financial results for the second quarter end June 30, 2020. A copy of the press release is attached as Exhibit 99.1, which is furnished under Item 2.02 of this report and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, (the Exchange Act) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.
Item 9.01 Financial Statements and Exhibits.
Exhibit No.
Description
 
 
 
 
Press release dated
August 10, 2020
104
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)






SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
HALOZYME THERAPEUTICS, INC.
  
 
 
 
 
August 10, 2020
 
By:
 
/s/ Masaru Matsuda
 
 
 
 
 
 
 
Name:
 
Masaru Matsuda, Esq.
 
 
Title:
 
Senior Vice President, General Counsel and Corporate Secretary



Exhibit


Exhibit 99.1



HALOZYME REPORTS SIGNIFICANT RECENT ACHIEVEMENTS AND SECOND QUARTER 2020 RESULTS

- Reports First Quarter of Expected Sustainable Profitability and Maintains 2020 Guidance of $230 to $245 Million in Revenues and $0.60 to $0.75 Earnings Per Share -

- Two U.S. FDA Approvals and One EMA Approval Received by Partners for Products Utilizing Halozyme’s ENHANZE® Technology During Second Quarter -

- Recent FDA Approval of Roche’s PhesgoTM Allows for Home Administration by a Qualified Healthcare Professional -


SAN DIEGO, August 10, 2020 - Halozyme Therapeutics, Inc. (NASDAQ: HALO) today reported financial results for the second quarter ended June 30, 2020 and provided an update on its recent corporate activities and outlook.

“The second quarter marked the achievement of multiple key milestones for Halozyme including two FDA approvals and one EMA approval for partnered drugs bringing the total number of FDA approved products utilizing our ENHANZE® drug delivery technology to five,” said Dr. Helen Torley, president and chief executive officer. “In addition, we are delighted to report that in the second quarter we delivered our first profitable quarter of expected sustainable profitability with earnings per share of $0.19. We see this as an important first step in our transformation to a high growth, high margin business delivering sustainable revenue growth and profitability over the long term. The events of the quarter were highlighted by our partner Janssen receiving approvals in both the U.S. and the EU for the subcutaneous form of DARZALEX® utilizing ENHANZE®, which is branded as DARZALEX FASPROTM in the U.S. We earned $25 million in total milestone payments from Janssen during the quarter, upon the first commercial sales in both markets. In late June, our partner Roche received FDA approval for Phesgo™, a fixed-dose combination of two monoclonal antibodies, Perjeta® and Herceptin®, utilizing our ENHANZE® technology for the treatment of patients with HER2-positive breast cancer. In addition to providing important new treatment options for patients, each of these newly-approved drugs represents the subcutaneous form of a growing, blockbuster franchise, and we expect their adoption to be an important driver of our growth and profitability in the coming years."

"I want to again express my gratitude to the Halozyme team, our partners and suppliers for their tireless work as we all navigate challenges posed by the COVID-19 pandemic," continued Dr. Torley. “Based on the latest information from our partners, I am pleased to report that we are maintaining our financial outlook for the full year 2020. It is possible that our partners’ timelines may change as a result of future changes related to COVID-19. We will continue to monitor this closely and provide updates as appropriate.”






Second Quarter 2020 and Recent Highlights Include:

On June 29, the Company announced that Roche received FDA approval for Phesgo™ (pertuzumab, trastuzumab, and hyaluronidase-zzxf), a fixed-dose combination of Perjeta® and Herceptin® for subcutaneous injection utilizing ENHANZE® technology for the treatment of patients with HER2-positive breast cancer. Phesgo™ can be administered in approximately eight minutes for the initial loading dose and approximately five minutes for each subsequent maintenance dose. This is compared to approximately 150 minutes for a sequential infusion of a loading dose of Perjeta® and Herceptin® using the standard intravenous (IV) formulations, and between 60-150 minutes for subsequent maintenance infusions of the two medicines. Phesgo™ can be administered by a healthcare professional in a treatment center or at a patient's home.

On June 13, the Company announced that findings from Janssen’s phase 3 ANDROMEDA (AMY3001) study evaluating subcutaneous daratumumab utilizing ENHANZE® in light-chain Amyloidosis were presented at the European Hematology Association 25th Annual Congress. Janssen reported that the study met the primary endpoint of percentage of patients with hematologic complete response.

On June 4, the Company announced that Janssen received European marketing authorization for the subcutaneous formulation of DARZALEX® (daratumumab) utilizing ENHANZE® for the treatment of adult patients with multiple myeloma in all currently approved DARZALEX® intravenous (IV) formulation indications in frontline and relapsed / refractory settings. Subsequent launch of the product and first commercial sale in Europe resulted in a $10 million milestone payment in the quarter.

In June 2020, Bristol Myers Squibb initiated a Phase 1/2 study of ipilimumab in combination with nivolumab in multiple tumor types utilizing ENHANZE® technology.

On May 1, the Company announced that Janssen received U.S. FDA approval of DARZALEX FASPROTM (daratumumab hyaluronidase human- fihj) in four regimens across five indications in multiple myeloma patients, including newly diagnosed, transplant-ineligible patients as well as relapsed or refractory patients. As a fixed-dose formulation, DARZALEX FASPROTM can be administered subcutaneously over three to five minutes, significantly less time than IV DARZALEX, which requires multi-hour infusions. Subsequent launch of the product and first commercial sale resulted in a $15 million milestone in the quarter.


Second Quarter 2020 Financial Highlights

Revenue for the second quarter was $55.2 million compared to $39.1 million for the second quarter of 2019. The year-over-year increase was primarily driven by $32.3 million in collaboration payments from Janssen and Bristol Myers Squibb in the current period. Revenue for the quarter included $15.8 million in royalties, which compared to $18.1 million in the prior year period.






Research and development expenses for the second quarter were $9.0 million, compared to $33.9 million for the second quarter of 2019. The decrease in expenses was due to a decrease in clinical trial activities-related costs as a result of the Company halting its oncology drug development efforts in November 2019.

Selling, general and administrative expenses for the second quarter were $11.0 million, compared to $17.3 million for the second quarter of 2019. The decrease was due to lower compensation and commercial-related expenses related to the corporate restructuring announced in November 2019.

The Company reported the first quarter of what it expects will be sustainable profitability. Net income for the second quarter was $25.8 million, or $0.19 per share, compared to a net loss in the second quarter of 2019 of $14.6 million, or $0.10 per share.

Cash, cash equivalents and marketable securities were $385.4 million at June 30, 2020, compared to $421.3 million at December 31, 2019.


Financial Outlook for 2020

The Company continues to monitor the impact of the COVID-19 pandemic on its business and receives updates from its partners and suppliers on how their businesses are affected. Based on this information and Halozyme's planned expenditures for the year, the Company's 2020 financial guidance remains unchanged. For 2020 Halozyme continues to expect:

Revenues of $230 million to $245 million, representing growth of 17% to 25%;

Earnings per share on a GAAP basis of $0.60 to $0.75.

The Company remains committed to capital return and plans to repurchase an additional number of shares, up to an additional $96 million worth, during the remainder of 2020. The amount and timing of shares repurchased during 2020 will be subject to a variety of factors including market conditions, other business considerations and applicable legal requirements.

Webcast and Conference Call

Halozyme will webcast its Quarterly Update Conference Call for the second quarter of 2020 today, Monday, August 10, 2020 at 4:30 p.m. ET/1:30 p.m. PT. Dr. Torley will lead the call, which will be webcast live through the "Investors" section of Halozyme's corporate website and a replay will be available following the close of the call. To register for this conference call, please use this link:http://www.directeventreg.com/registration/event/6277618. To access the webcast and additional documents related to the call, please visit halozyme.com approximately fifteen minutes prior to the call to register, download and install any necessary audio software. A telephone replay will be available for two weeks after the call by dialing (800) 585-8367 (domestic callers) or (416) 621-4642 (international callers) using replay ID number 6277618.


About Halozyme

Halozyme is a biopharmaceutical company bringing disruptive solutions to significantly improve patient experiences and outcomes for emerging and established therapies. Halozyme advises and supports





its biopharmaceutical partners in key aspects of new drug development with the goal of improving patients' lives while helping its partners achieve global commercial success. As the innovators of the ENHANZE® technology, which can reduce hours-long treatments to a matter of minutes, Halozyme’s commercially-validated solution has positively impacted more than 400,000 patient lives via five commercialized products across more than 100 global markets. Halozyme and its world-class partners are currently advancing multiple therapeutic programs intended to deliver innovative therapies, with the potential to improve the lives of patients around the globe. Halozyme’s proprietary enzyme rHuPH20 forms the basis of the ENHANZE® technology and is used to facilitate the delivery of injected drugs and fluids, potentially reducing the treatment burden of other drugs to patients. Halozyme has licensed its ENHANZE® technology to leading pharmaceutical and biotechnology companies including Roche, Baxalta, Pfizer, Janssen, AbbVie, Lilly, Bristol-Myers Squibb, Alexion and argenx. Halozyme derives revenues from these collaborations in the form of milestones and royalties as the Company’s partners make progress developing and commercializing their products being developed with ENHANZE®. Halozyme is headquartered in San Diego. For more information visit www.halozyme.com.


Safe Harbor Statement

In addition to historical information, the statements set forth in this press release include forward-looking statements including, without limitation, statements concerning the Company’s expected future financial performance (including the Company's financial outlook for 2020) and expectations for future growth, profitability, revenue, margins, expenses and earnings-per-share and the Company’s plans to continue its share repurchase program. Forward-looking statements regarding the Company’s ENHANZE® drug delivery technology may include the possible activity, benefits and attributes of ENHANZE®, the possible method of action of ENHANZE®, its potential application to aid in the dispersion and absorption of other injected therapeutic drugs and facilitating more rapid delivery of injectable medications through subcutaneous delivery. Forward-looking statements regarding the Company's ENHANZE® business may include potential growth driven by our partners' development and commercialization efforts, the size and growth prospects of our partners' drug franchises, potential new ENHANZE® collaborations and collaborative targets and regulatory review and potential approvals of new ENHANZE® products. These forward-looking statements are typically, but not always, identified through use of the words "believe," "enable," "may," "will," "could," "intends," "estimate," "anticipate," "plan," "predict," "probable," "potential," "possible," "should," "continue," and other words of similar meaning and involve risk and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Actual results could differ materially from the expectations contained in these forward-looking statements as a result of several factors, including unexpected levels of revenues, expenditures and costs, inability to sustain profitability, unexpected delays in the execution of the Company's share repurchase program, unexpected results or delays in the growth of the Company’s ENHANZE® business, or in the development, regulatory review or commercialization of ENHANZE® products, including any potential delays caused by the current COVID-19 global pandemic, regulatory approval requirements, unexpected adverse events or patient outcomes and competitive conditions. These and other factors that may result in differences are discussed in greater detail in the Company's most recently filed Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Contact:
Al Kildani
Vice President, Investor Relations and Corporate Communications
858-704-8122
ir@halozyme.com






Halozyme Therapeutics, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)
 
 
Three Months Ended
June 30,
 
Six Months Ended
 
 
2020
 
2019
 
2020
 
2019
Revenues:
 
 
 
 
 
 
 
 
Royalties
 
$
15,846

 
$
18,107

 
$
32,668

 
$
36,060

Product sales, net
 
6,337

 
5,760

 
14,484

 
14,150

Revenues under collaborative agreements
 
33,038

 
15,281

 
33,423

 
45,887

Total revenues
 
55,221

 
39,148

 
80,575

 
96,097

Operating expenses:
 
 
 
 
 
 
 
 
Cost of product sales
 
5,740

 
1,877

 
11,527

 
6,526

Research and development
 
8,951

 
33,910

 
19,109

 
65,238

Selling, general and administrative
 
10,975

 
17,338

 
23,607

 
35,344

Total operating expenses
 
25,666

 
53,125

 
54,243

 
107,108

Operating income (loss)
 
29,555

 
(13,977
)
 
26,332

 
(11,011
)
Other income (expense):
 
 
 
 
 
 
 
 
Investment and other income, net
 
1,324

 
1,983

 
3,803

 
4,040

Interest expense
 
(5,004
)
 
(2,613
)
 
(10,352
)
 
(5,818
)
Net income (loss) before income taxes
 
25,875

 
(14,607
)
 
19,783

 
(12,789
)
Income tax expense
 
58

 
17

 
69

 
39

Net income (loss)
 
$
25,817

 
$
(14,624
)
 
$
19,714

 
$
(12,828
)
 
 
 
 
 
 
 
 
 
Net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
$
0.19

 
$
(0.10
)
 
$
0.14

 
$
(0.09
)
Diluted
 
$
0.19

 
$
(0.10
)
 
$
0.14

 
$
(0.09
)
 
 
 
 
 
 
 
 
 
Shares used in computing net income (loss) per share:
 
 
 
 
 
 
 
 
Basic
 
135,935

 
145,411

 
136,572

 
145,051

Diluted
 
138,084

 
145,411

 
138,837

 
145,051






Halozyme Therapeutics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
 
 
June 30,
2020
 
December 31,
2019
ASSETS
 
 
 
 
Current assets:
 
 
 
 
Cash and cash equivalents
 
$
133,606

 
$
120,179

Marketable securities, available-for-sale
 
251,840

 
301,083

Accounts receivable, net
 
37,401

 
59,442

Inventories
 
48,271

 
29,359

Prepaid expenses and other assets
 
29,240

 
33,373

Total current assets
 
500,358

 
543,436

Property and equipment, net
 
11,169

 
10,855

Prepaid expenses and other assets
 
14,970

 
11,083

Restricted cash
 
500

 
500

Total assets
 
$
526,997

 
$
565,874

 
 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
Current liabilities:
 
 
 
 
Accounts payable
 
$
4,067

 
$
6,434

Accrued expenses
 
21,258

 
55,649

Deferred revenue, current portion
 
748

 
4,012

Current portion of long-term debt, net
 

 
19,542

Total current liabilities
 
26,073

 
85,637

 
 
 
 
 
Deferred revenue, net of current portion
 
641

 
1,247

Long-term debt, net
 
390,079

 
383,045

Other long-term liabilities
 
4,627

 
4,180

 
 
 
 
 
Stockholders’ equity:
 
 
 
 
Common stock
 
137

 
137

Additional paid-in capital
 
688,318

 
695,066

Accumulated other comprehensive income (loss)
 
1,086

 
240

Accumulated deficit
 
(583,964
)
 
(603,678
)
Total stockholders’ equity
 
105,577

 
91,765

Total liabilities and stockholders’ equity
 
$
526,997

 
$
565,874







v3.20.2
Cover Page
Aug. 10, 2020
Cover page.  
Document Type 8-K
Document Period End Date Aug. 10, 2020
Entity Registrant Name HALOZYME THERAPEUTICS, INC.
Entity File Number 001-32335
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 88-0488686
Entity Address, Address Line One 11388 Sorrento Valley Road
Entity Address, City or Town San Diego
Entity Address, State or Province CA
Entity Address, Postal Zip Code 92121
City Area Code 858
Local Phone Number 794-8889
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.001 par value
Trading Symbol HALO
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001159036