-- CHF 46.1 million (+26% year-on-year) non-deferred Cresemba and Zevtera 
      revenue, including CHF 23.6 million royalty income (+27% year-on-year) 
      reflecting continued commercial success of marketed brands 
 
   -- Strong operational performance led to 18% improvement in net cash used in 
      operating activities 
 
   -- Operating result improved by 40% year-on-year, excluding the one-off 
      profit from HQ property sale in H1 2020 and deferred revenue 
 
   -- CHF 164.7 million cash and investments at half-year 2021 
 
   -- 2021 full-year guidance increased; higher revenue expectations leading to 
      better operating result

Ad hoc announcement pursuant to Art. 53 LR

Basel, Switzerland, August 17, 2021

Basilea Pharmaceutica Ltd. (SIX: BSLN) announced today its financial results for the first six months ended June 30, 2021.

David Veitch, Chief Executive Officer, said: "The first half of 2021 reflected a strong operational performance as we significantly increased the cash flow from our two marketed brands. In addition, we are building the basis for future growth by making good progress in our oncology development programs. Particularly encouraging are the updated efficacy data for patients with FGFR2 fusion-positive iCCA, a form of bile duct cancer, who received derazantinib within our FIDES-01 study and the continued long-lasting clinical benefit reported for EB1-positive glioblastoma patients from the phase 1/2 study with lisavanbulin."

Adesh Kaul, Chief Financial Officer, added: "As announced last year, we will have largely completed the significant change in our revenue mix in 2021. The non cash-relevant recognition of deferred revenue from upfront, development and regulatory milestone payments received in prior years, has reduced 95% year-on-year, now representing less than 3% of our total Cresemba and Zevtera related revenue. This allows a much clearer view on the significant cash contribution of our commercial business. We have reported CHF 46.1 million in total Cresemba and Zevtera non-deferred revenue, a 26% growth year-on-year. Royalty income, which most closely reflects the underlying strength of our key brand Cresemba in the major territories, grew by 27% year-on-year to CHF 23.6 million."

He continued: "We also continue to manage our cost base. We were able to keep our total cost and operating expenses at a stable level in spite of the growth of our commercial business and the continued progress in our drug development portfolio. The strong underlying operational performance is positively reflected in our operating result, which improved 40% year-on-year, when excluding the one-off profit from the sale of our headquarters property in the first half-year 2020 and the deferred revenue recognition in both periods."

Financial summary

Total revenue in the first half-year 2021 was CHF 54.2 million (H1 2020: CHF 69.3 million), reflecting the already anticipated decrease in the recognition of deferred revenue to CHF 1.3 million (H1 2020: CHF 25.5 million) related to upfront, development and regulatory milestone payments received in prior years from partners. Non-deferred revenue contribution from the two marketed brands Cresemba and Zevtera increased by 26.3% to CHF 46.1 million (H1 2020: CHF 36.5 million). Other revenue amounted to CHF 6.6 million (H1 2020: CHF 7.1 million). This included CHF 5.5 million BARDA reimbursements (H1 2020: CHF 6.6 million), which are offsetting a substantial portion of the ceftobiprole phase 3 development expenses.(1) The BARDA reimbursements year-on-year decreased in line with the reduced development expenses following the successful completion of the ceftobiprole phase 3 skin infection study.

In the first half of 2021, investments in the pipeline resulted in research and development expenses of CHF 41.7 million (H1 2020: CHF 43.9 million). Such expenses were mainly driven by costs for the phase 3 program for ceftobiprole, the costs related to the ongoing preclinical and clinical programs for derazantinib and lisavanbulin, as well as to the ongoing pediatric programs for ceftobiprole and isavuconazole.

Selling, general and administrative expenses amounted to CHF 14.4 million (H1 2020: CHF 14.5 million). In line with increasing sales of products to partners, cost of products sold increased to CHF 13.5 million (H1 2020: CHF 13.1 million).

In the first half-year of 2021, the operating loss amounted to CHF 15.4 million (H1 2020: operating profit of CHF 12.8 million). The operating result H1 2020 was positively impacted by CHF 15.0 million in an one-off profit from the sale of Basilea's headquarters property and CHF 24.2 million higher deferred revenue related to upfront and milestone payments from Astellas, Pfizer and Gosun, which were all fully recognized in FY 2020. The net loss amounted to CHF 19.9 million (H1 2020: net profit of CHF 9.9 million), resulting in a basic and diluted loss per share of CHF 1.84 (H1 2020: basic earnings and diluted earnings per share of CHF 0.92 and CHF 0.91, respectively).

Net cash used in operating activities in H1 2021 was reduced by 18.1% to CHF 27.2 million as compared to CHF 33.2 million in H1 2020. This improvement is a result, on the one hand of the significant increase in cash inflow, based on the growth of Cresemba and Zevtera non-deferred revenue contributions and on the other hand, of Basilea's continued focus on managing operating expenses, by continuously optimizing investments into the preclinical and clinical portfolio and improving the cost base through strategic transactions. Cash and investments amounted to CHF 164.7 million as of June 30, 2021, compared to CHF 167.3 million as of December 31, 2020. The convertible bond maturing in December 2022 (ISIN CH0305398148) was reduced by CHF 12.4 million in H1 2021.

Key financial figures 


 
(in CHF million, except per share data)              H1 2021        H1 2020 
------------------------------------------------  -------------  ------------- 
           Product revenue                                 13.6           30.5 
------------------------------------------------  -------------  ------------- 
           Contract revenue                                33.8           31.5 
------------------------------------------------  -------------  ------------- 
           Revenue from R&D services                        0.2            0.2 
------------------------------------------------  -------------  ------------- 
           Other revenue                                    6.6            7.1 
------------------------------------------------  -------------  ------------- 
Total revenue                                              54.2           69.3 
------------------------------------------------  -------------  ------------- 
           Cost of products sold                         (13.5)         (13.1) 
------------------------------------------------  -------------  ------------- 
           Research & development expenses, net          (41.7)         (43.9) 
------------------------------------------------  -------------  ------------- 
           Selling, general & administrative 
            expenses                                     (14.4)         (14.5) 
------------------------------------------------  -------------  ------------- 
Total cost and operating expenses                        (69.6)         (71.5) 
------------------------------------------------  -------------  ------------- 
           Profit from sale of assets                         -           15.0 
------------------------------------------------  -------------  ------------- 
Operating loss/profit                                    (15.4)           12.8 
------------------------------------------------  -------------  ------------- 
Net loss/profit                                          (19.9)            9.9 
------------------------------------------------  -------------  ------------- 
Net cash used in operating activities                    (27.2)         (33.2) 
------------------------------------------------  -------------  ------------- 
Basic loss/earnings per share, in CHF                    (1.84)           0.92 
------------------------------------------------  -------------  ------------- 
Diluted loss/earnings per share, in CHF                  (1.84)           0.91 
------------------------------------------------  -------------  ------------- 
 
                                (In CHF million)  June 30, 2021  Dec. 31, 2020 
------------------------------------------------  -------------  ------------- 
Cash and investments                                      164.7          167.3 
------------------------------------------------  -------------  -------------

Note: Consolidated figures in conformity with U.S. GAAP; rounding was applied consistently.

The unaudited, condensed consolidated interim financial statements of Basilea Pharmaceutica Ltd. for the first half-year 2021 can be found on the Company's website at https://www.basilea.com/financial-reports.

FY 2021 financial guidance

Basilea increases its revenue guidance and expects a better operating result for full-year 2021: 


   -- Non-deferred revenue contributions from Cresemba and Zevtera are expected 
      to grow to CHF 115 - 125 million (+47% to +60% y-o-y), reflecting the 
      continued significant growth of in-market sales by its partners and 
      several potential milestone events in the second half of 2021. 
 
   -- Total R&D and SG&A expenses are expected to remain approximately stable. 
      Cost of products sold is expected to increase in line with higher product 
      deliveries to partners. 
 
   -- The anticipated operating loss amounts to CHF 7 - 17 million, which is 
      below the operating loss reported for FY 2020, excluding the one-off 
      positive impact from the sale of the headquarters property. 
 
   -- Cash and investments are expected to be approximately CHF 165 - 
      170 million at year-end 2021, excluding any impact from a reduction of

(MORE TO FOLLOW) Dow Jones Newswires

August 17, 2021 01:15 ET (05:15 GMT)