After more than a decade of research, development, and waiting more than a year for a delayed FDA approval, Human Genome Sciences, Inc (NASDAQ: HGSI) finally has a drug on the market that it can consistently sell to the healthcare industry.
The Rockville, Md biotechnology company reported Benlysta net sales of $7.8 Million. $1.2 Million in additional sales were excluded due to non-delivery to healthcare providers prior to the release of second quarter financial results.
Increasing Lupus Drug Sales
The largest biotech in the Baltimore-Washington area measured by market value said Benlysta is gaining momentum and sales in the last four shipping weeks of the quarter ended June 30, 2011, almost doubled to $1,050,000. The previous four-week periods posted net sales of $630,000 and $270,000 respectively.
Benlysta (belimumab) is the first FDA approved Lupus drug in more than 56 years. Human Genome Sciences received approval of the drug to market March 9, 2011 and began distribution the following two weeks.
H. Thomas Watkins, President and Chief Executive Officer said “We are making good progress with the U.S. launch of BENLYSTA, and the HGS and GSK teams are working closely together to ensure that patients with systemic lupus who need BENLYSTA will have access to it,” Watkins continued “We are also very pleased to have received approvals to market BENLYSTA in Europe and Canada, and we look forward to working with GSK to make BENLYSTA available on a global basis.”
European Approval and Global Sales
Along with London, U.K based partner GlaxoSmithKline, Human Genome Sciences announced July 14, 2011 that it had received approval for Benysta from the European Commission (EC).
“The European approval of BENLYSTA represents a significant milestone, and we are very pleased to be able to provide physicians an additional therapeutic option for treating appropriate patients with this chronic disease,” stated Dr. Tony Hoos, Senior VP, European Medical Affairs, GSK.
The European approval of Benlysta quickly followed the United States approval, only a few months after and in the same year. It will allow HGSI to accumulate revenue at a faster pace than what typically happens where global sales of a drug may be years away.
“We and GSK are committed to making BENLYSTA available in countries worldwide,” stated H. Thomas Watkins, President and Chief Executive Officer, HGS. “We are particularly honored to be bringing this medicine forward in Europe, where a number of key academic research institutions were very important to its clinical development.”
In addition to the July 13, 2011 granted marketing by EC, Health Canada also granted approval days before on July 6, 2011 with availability for use in the Canadian market in September.
Human Genome Sciences also noted it's awaiting approval in Australia, Brazil, Colombia, Israel, The Philippines, Russia, Singapore, Switzerland and Taiwan. Some analyst have npredicted that the company could garner annual sales as high as $6 Billion.
Consolidated Financial Statements
Product sales totaled $20.6 Million for the three months ended June 30, 2011 versus $13.1 Million in same period 2010. But total revenue was down to $24.85 Million from $38.8 Million in 2010. Revenues also included $12.9 Million from the delivery of the experimental anthrax drug Raxibacumab to the U.S. Strategic National Stockpile.
Despite a large drop in research and development costs from $51.4 Million to $33.4 Million in 2011, overall expenses were $93.35 Million in the second quarter of 2011compared to expenses of $85.8 Million in 2010.
The increase was due primarily to higher selling, general and administrative expenses and cost of product sales. Upfront and milestone payments of $19.1 Million for the Zalbin drug agreement with pharmaceutical giant Novartis International AG, attributed to the revenue decline.
Total revenue for the past six months was $51.4 Million in 2011 compared to $85.3 Million in the first half of 2010.
For the second quarter 2011, a net loss of $80.7 Million was reported. In 2010, the loss amounted to $56.9 Million.
Human Genome Sciences still had $703.3 Million in cash and cash equivalents on hand, enough to continue marketing Benlysta.
“We are pleased to report our first full quarter of BENLYSTA sales,” proclaimed David P. Southwell, Executive Vice President and Chief Financial Officer of HGSI. “The support of BENLYSTA's global commercial launch and its further product development remain our top financial priority.”
Human Genome Sciences, Inc has several products in the mid-stage pipeline, Benlysta is the first FDA approved for the company. HGSI shares were up 18 cents after hours. The company has a market capitalization of approximately $4.4 Billion.