01—Abstract
Summary
Summary of the 10-K filed February 23, 2023. Cited figures are marked; the original filing is the authoritative source.
Insmed Incorporated's 2022 annual report, filed February 23, 2023, centers on ARIKAYCE, its only approved product, which generated product revenues, net, of $245.4 milliona in 2022, up from $188.5 million in 2021.
Revenue by geography was US $186.0 millionb, Japan $56.5 million, and Europe and rest of world $2.9 million. Growth was driven by the US and Japan, partly offset by a $7.5 million revenue reduction in Q4 2022 tied to the final French ATU reimbursement price. Net loss widened to $481.5 million from $434.7 million, as R&D expenses rose to $397.5 million and SG&A to $265.8 million.
The accumulated deficit reached $2.7 billionc. The pipeline includes brensocatib, a Phase 3 ASPEN trial in bronchiectasis with topline data expected in the second quarter of 2024, and TPIP, in Phase 2 studies for PH-ILD and PAH with PH-ILD topline results expected in the first half of 2024. ARIKAYCE's US accelerated approval depends on confirmatory ARISE and ENCORE trials, with ARISE topline data expected in the third quarter of 2023.
The company reports cash and cash equivalents of $1,074.0 milliond and marketable securities of $74.2 million at year-end 2022, and states this supports operations for at least the next 12 months. Financing in October 2022 added a $350 million senior secured term loan from Pharmakon and a $150 million royalty financing agreement with OrbiMed, alongside a 13.75 million share offering at $20.00 per share with net proceeds of $258.8 million.
Total long-term debt and royalty financing reached roughly $1.3 billion, including $800 million of convertible notes face value. Customer concentration is high: the three largest customers accounted for 90% of gross product revenue in 2022.
02—Key points
Key Highlights
- Product revenues, net, rose to $245.4 million in 2022 from $188.5 million in 2021, with Japan growing to $56.5 million from $16.0 million.
- Net loss was $481.5 million in 2022 versus $434.7 million in 2021; R&D expenses increased to $397.5 million from $272.7 million.
- Cash and cash equivalents of $1,074.0 million and marketable securities of $74.2 million at December 31, 2022; management states funds are sufficient for at least the next 12 months.
- October 2022 financings included a $350 million Pharmakon term loan (SOFR plus 7.75%, maturing October 2027) and a $150 million OrbiMed royalty financing at 4% of ARIKAYCE global net sales.
- ARIKAYCE's US full approval depends on the ARISE and ENCORE confirmatory trials; ARISE topline data are expected in Q3 2023 and ENCORE enrollment completion by end of 2023.
- Brensocatib Phase 3 ASPEN topline data are expected in Q2 2024; TPIP PH-ILD topline results are expected in H1 2024.
- The three largest customers accounted for 90% of gross product revenue in 2022, versus 75% in 2021.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2022filed February 23, 2023Financial Statements
FY2022 against FY2021
| Line item | FY2022FY2021 | Change |
|---|---|---|
| Revenue | $245.36M$188.46M | +30.2% |
| Cost of Revenue | $55.13M$44.15M | +24.9% |
| Gross Profit | $190.23M$144.31M | +31.8% |
| R&D Expenses | $397.52M$272.74M | +45.7% |
| SG&A Expenses | $265.78M— | — |
| Operating Expenses | $702.68M$563.55M | +24.7% |
| Operating Income | -$457.32M-$375.09M | −21.9% |
| Interest Expense | $26.45M$40.47M | −34.7% |
| Net Income | -$481.53M-$434.65M | −10.8% |
| EPS (Basic) | $-3.91$-3.88 | −0.8% |
| EPS (Diluted) | $-3.91$-3.88 | −0.8% |
| Shares Outstanding (Basic) | 123.03M112.11M | +9.7% |
| Shares Outstanding (Diluted) | 123.03M112.11M | +9.7% |
05—Questions
Frequently Asked Questions
How much revenue did ARIKAYCE generate in 2022, and where did growth come from?
Product revenues, net, were $245.4 million in 2022, compared with $188.5 million in 2021. US revenue was $186.0 million, Japan $56.5 million, and Europe and rest of world $2.9 million. Growth came mainly from the US and Japan, partly offset by a $7.5 million revenue reduction in Q4 2022 from the final French reimbursement price.
What is the company's cash position and runway?
As of December 31, 2022, Insmed held $1,074.0 million in cash and cash equivalents and $74.2 million in marketable securities. Management believes these funds will enable it to fund operations for at least the next 12 months, though it may raise additional capital.
What are the key near-term catalysts in the pipeline?
The company expects ARISE topline efficacy and safety data in Q3 2023 and completion of ENCORE enrollment by year-end 2023. It expects brensocatib Phase 3 ASPEN topline data in Q2 2024, interim blinded TPIP PH-ILD data in H2 2023, and TPIP PH-ILD topline results in H1 2024.
What risks are tied to ARIKAYCE's approval status in the US?
ARIKAYCE received accelerated approval in September 2018 under the LPAD pathway. Full approval requires successful completion of the confirmatory ARISE and ENCORE trials, with results reported by 2024 under the FDA timetable. Failure could lead the FDA to withdraw approval using expedited procedures.
How concentrated is the company's customer base?
The three largest customers represented 90% of total gross product revenue for 2022, up from 75% in 2021. The filing notes that losing any of them could adversely affect financial condition and results of operations.
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