Full Press Release Details
Innoviva Reports Second Quarter 2024 Financial
Results; Highlights Recent Company Progress
Core royalty platform continued strong performance,
receiving GSK royalties of $67.2 million
Innoviva Specialty Therapeutics' (IST)
marketed portfolio grew 38% year-over-year, achieving net product sales of $21.7 million
treatment guidelines and guidance updates recognized our key products: XACDURO by 2024
Infectious Diseases Society of America (IDSA); XERAVA by 2024 Surgical Infection Society
XACDURO approved in China
Calif. - July 31, 2024 - Innoviva, Inc. (NASDAQ: INVA) ("Innoviva" or the "Company"),
a diversified holding company with a core royalties portfolio, a leading
critical care and infectious disease platform known as Innoviva Specialty Therapeutics ("IST"),
and a portfolio of strategic investments in healthcare assets, today reported financial results for the second quarter ended June 30,
2024, and highlighted select corporate achievements.
robust second quarter continues to demonstrate the successful transformation of Innoviva. We have strong performance across multiple fronts,
driven by our core GSK royalties portfolio and accelerating growth from our commercial products, GIAPREZA , XACDURO and XERAVA ,"
said Pavel Raifeld, Chief Executive Officer of Innoviva. "We remain committed to enhancing shareholder value through thoughtful
capital allocation and operational excellence. We also are excited about our portfolio of strategic healthcare assets, where we continue
to see potential for significant value creation."
added, "In addition to driving strong operational delivery from our critical care and infectious disease platform IST, we
continue to expand its global footprint and enhance recognition. Our partner in China, Zai Lab, successfully obtained regulatory
approval for XACDURO , bringing us closer to making XACDURO available to all patients globally. In
the U.S, important treatment guidelines and guidance updates recognized our key products, underscoring their life-saving potential.
XACDURO was named the preferred agent for treatment of Carbapenem-resistant Acinetobacter baumannii infections
in the 2024 Infectious Diseases Society of America (IDSA) treatment guidance. XERAVA is recommended by the 2024
Surgical Infection Society (SIS) treatment guidelines for empiric therapy in the management of complicated intra-abdominal
Financial Highlights
Key Business and R&D
Innoviva is a diversified holding company
with a core royalties portfolio, a leading critical care and infectious disease platform known as Innoviva Specialty Therapeutics ("IST"),
and a portfolio of strategic investments in healthcare assets. Innoviva's royalty portfolio includes respiratory assets partnered
with Glaxo Group Limited ("GSK"). Innoviva is entitled to receive royalties from GSK on sales of RELVAR /BREO ELLIPTA
and ANORO ELLIPTA . Innoviva's other innovative healthcare assets include infectious disease and critical care assets stemming
from acquisitions of Entasis Therapeutics, including XACDURO (sulbactam for injection; durlobactam for injection), co-packaged for
intravenous use approved for the treatment of adults with hospital-acquired bacterial pneumonia and ventilator-associated bacterial pneumonia
caused by susceptible strains of Acinetobacter baumannii-calcoaceticus complex and the investigational zoliflodacin currently being developed
for the treatment of uncomplicated gonorrhea, and La Jolla Pharmaceutical Company, including GIAPREZA (angiotensin II), approved
to increase blood pressure in adults with septic or other distributive shock and XERAVA (eravacycline) for the treatment of complicated
intra-abdominal infections in adults.
ANORO , RELVAR and BREO are
trademarks of the GSK group of companies.
Forward Looking Statements
This press release contains certain "forward-looking"
statements as that term is defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, statements relating
to goals, plans, objectives, and future events. Innoviva intends such forward-looking statements to be covered by the safe harbor provisions
for forward-looking statements contained in Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation
Reform Act of 1995. The words "anticipate", "expect", "goal", "intend", "objective",
"opportunity", "plan", "potential", "target" and similar expressions are intended to identify
such forward-looking statements. Such forward-looking statements involve substantial risks, uncertainties, and assumptions. These statements
are based on the current estimates and assumptions of the management of Innoviva as of the date of this press release and are subject
to known and unknown risks, uncertainties, changes in circumstances, assumptions and other factors that may cause the actual results of
Innoviva to be materially different from those reflected in the forward-looking statements. Important factors that could cause actual
results to differ materially from those indicated by such forward-looking statements include, among others, risks related to: expected
cost savings; lower than expected future royalty revenue from respiratory products partnered with GSK; the commercialization of RELVAR /BREO
ELLIPTA , ANORO ELLIPTA , GIAPREZA , XERAVA and XACDURO in the jurisdictions in which these products have been
approved; the strategies, plans and objectives of Innoviva (including Innoviva's growth strategy and corporate development initiatives);
the timing, manner, and amount of potential capital returns to shareholders; the status and timing of clinical studies, data analysis
and communication of results; the potential benefits and mechanisms of action of product candidates; expectations for product candidates
through development and commercialization; the timing of regulatory approval of product candidates; and projections of revenue, expenses
and other financial items; the impact of the novel coronavirus ("COVID-19"); the timing, manner and amount of capital deployment,
including potential capital returns to stockholders; and risks related to the Company's growth strategy. Other risks affecting Innoviva
are described under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition
and Results of Operations" contained in Innoviva's Annual Report on Form 10-K for the year ended December 31, 2023
and Quarterly Reports on Form 10-Q, which are on file with the Securities and Exchange Commission ("SEC") and available
on the SEC's website at www.sec.gov. Past performance is not necessarily indicative of future results. No forward-looking statements
can be guaranteed, and actual results may differ materially from such statements. Given these uncertainties, you should not place undue
reliance on these forward-looking statements. The information in this press release is provided only as of the date hereof, and Innoviva
assumes no obligation to update its forward-looking statements on account of new information, future events or otherwise, except as required
(1) Tala, B., Jad, A., Claude, A.,
Jihad, I., Chantal, L., Rakan, N.,& Eid, A. (2017). Risk Factors, Clinical Presentation, and Outcome of Acinetobacter baumannii
Bacteremia. Front. Cell. Infect. Microbiol., 04 May 2017, Sec. Molecular Bacterial Pathogenesis Volume 7 - 2017:
Corporate Communications
Investors and Media:
Condensed Consolidated Statements of Income and Comprehensive Income
(in thousands, except per share data)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Revenue: | ||||||||||||||||
| Royalty revenue, net (1) | $ | 63,742 | $ | 62,265 | $ | 122,157 | $ | 119,123 | ||||||||
| Net product sales | 21,651 | 15,727 | 40,735 | 27,241 | ||||||||||||
| License revenue | 14,505 | 3,000 | 14,505 | 11,000 | ||||||||||||
| Total revenue | 99,898 | 80,992 | 177,397 | 157,364 | ||||||||||||
| Expenses: | ||||||||||||||||
| Cost of products sold (inclusive of amortization of inventory fair value adjustments) | 8,472 | 8,979 | 19,443 | 17,728 | ||||||||||||
| Cost of license revenue | - | - | - | 1,600 | ||||||||||||
| Selling, general and administrative | 27,740 | 23,542 | 58,145 | 43,277 | ||||||||||||
| Research and development | 2,560 | 14,989 | 6,438 | 27,577 | ||||||||||||
| Amortization of acquired intangible assets | 6,440 | 4,958 | 12,880 | 8,763 | ||||||||||||
| Changes in fair values of equity method investments, net | 60,108 | 19,911 | 24,766 | 4,094 | ||||||||||||
| Changes in fair values of equity and long-term investments, net | 30,556 | 83 | 43,891 | 2,247 | ||||||||||||
| Interest and dividend income | (3,474 | ) | (3,553 | ) | (7,873 | ) | (6,918 | ) | ||||||||
| Interest expense | 5,802 | 4,382 | 11,653 | 8,809 | ||||||||||||
| Other expense, net | 973 | 1,896 | 2,209 | 3,242 | ||||||||||||
| Total expenses, net | 139,177 | 75,187 | 171,552 | 110,419 | ||||||||||||
| Income (loss) before income taxes | (39,279 | ) | 5,805 | 5,845 | 46,945 | |||||||||||
| Income tax expense (benefit), net | (4,594 | ) | 4,525 | 3,998 | 10,800 | |||||||||||
| Net income (loss) and comprehensive income (loss) | $ | (34,685 | ) | $ | 1,280 | $ | 1,847 | $ | 36,145 | |||||||
| Net income (loss) per share | ||||||||||||||||
| Basic | $ | (0.55 | ) | $ | 0.02 | $ | 0.03 | $ | 0.54 | |||||||
| Diluted | $ | (0.55 | ) | $ | 0.02 | $ | 0.03 | $ | 0.46 | |||||||
| Shares used to compute net income (loss) per share | ||||||||||||||||
| Basic | 62,526 | 65,341 | 62,856 | 66,557 | ||||||||||||
| Diluted | 62,526 | 65,489 | 63,064 | 88,175 |
(1) Total net revenue is comprised of the following (in thousands):
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Royalties | $ | 67,198 | $ | 65,721 | $ | 129,069 | $ | 126,035 | ||||||||
| Amortization of capitalized fees | (3,456 | ) | (3,456 | ) | (6,912 | ) | (6,912 | ) | ||||||||
| Royalty revenue, net | $ | 63,742 | $ | 62,265 | $ | 122,157 | $ | 119,123 |
Condensed Consolidated Balance Sheets
| June 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 217,003 | $ | 193,513 | ||||
| Royalty and product sale receivables | 93,980 | 84,075 | ||||||
| Inventory | 36,664 | 40,737 | ||||||
| Prepaid expense and other current assets | 10,630 | 25,894 | ||||||
| Property and equipment, net | 427 | 483 | ||||||
| Equity and long-term investments | 536,435 | 560,978 | ||||||
| Capitalized fees paid, net | 76,872 | 83,784 | ||||||
| Right-of-use assets | 3,118 | 2,536 | ||||||
| Goodwill | 17,905 | 17,905 | ||||||
| Intangible assets | 217,455 | 230,335 | ||||||
| Deferred tax asset, net | 11,446 | - | ||||||
| Other assets | 2,982 | 3,267 | ||||||
| Total assets | $ | 1,224,917 | $ | 1,243,507 | ||||
| Liabilities and stockholders' equity | ||||||||
| Other current liabilities | $ | 23,929 | $ | 33,435 | ||||
| Accrued interest payable | 3,422 | 3,422 | ||||||
| Deferred revenue | 855 | 1,277 | ||||||
| Convertible senior notes, due 2025, net | 191,659 | 191,295 | ||||||
| Convertible senior notes, due 2028, net | 255,623 | 254,939 | ||||||
| Other long-term liabilities | 72,065 | 71,870 | ||||||
| Deferred tax liabilities, net | - | 563 | ||||||
| Income tax payable, long-term | 11,849 | 11,751 | ||||||
| Innoviva stockholders' equity | 665,515 | 674,955 | ||||||
| Total liabilities and stockholders' equity | $ | 1,224,917 | $ | 1,243,507 |
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2024 | 2023 | |||||||
| Net cash provided by operating activities | $ | 80,765 | $ | 63,866 | ||||
| Net cash used in investing activities | (43,038 | ) | (35,722 | ) | ||||
| Net cash used in financing activities | (14,237 | ) | (146,168 | ) | ||||
| Net change | $ | 23,490 | $ | (118,024 | ) | |||
| Cash and cash equivalents at beginning of period | 193,513 | 291,049 | ||||||
| Cash and cash equivalents at end of period | $ | 217,003 | $ | 173,025 |