10-QPeriod: Q3 FY2022

BeOne Medicines Ltd. Quarterly Report for Q3 Ended Sep 30, 2022

Filed November 9, 2022For Securities:ONCBEIGF

Summary

Beigene, Ltd. (ONC) reported its third quarter 2022 financial results, showcasing significant year-over-year growth in product revenue driven by strong performance of its key oncology drugs, BRUKINSA® and tislelizumab. Total revenues saw a substantial increase primarily due to a surge in product sales, more than offsetting a decline in collaboration revenue which was impacted by the prior year's recognition of an upfront payment from Novartis. While operating expenses, particularly in research and development and selling, general, and administrative functions, also increased to support global expansion and pipeline development, the company demonstrated improved gross margins. Beigene continues to manage its cash reserves effectively, reporting a solid cash balance despite ongoing investments in its growth initiatives. The company also disclosed revisions to prior period financial statements to correct an error related to the valuation of net deferred tax assets.

Financial Highlights

54 data points
Beta

Revenue

$387.63M

80.3% Gross Margin

Net Income

-$557.56M

-143.8% Net Margin

EPS (Diluted)

$-0.41

Total Assets

$6.73B

Cash & Equivalents

$4.20B

Free Cash Flow

-$670.56M

Financial Statements
Beta
Revenue$387.63M
Cost of Revenue$76.54M
Gross Profit$311.08M
R&D Expenses$426.36M
SG&A Expenses$322.89M
Operating Expenses$825.99M
Operating Income-$438.36M
Interest Expense$5.60M
Net Income-$557.56M
EPS (Basic)$-0.41
EPS (Diluted)$-0.41
Shares Outstanding (Basic)1.35B
Shares Outstanding (Diluted)1.35B

Key Highlights

  • 1Total revenues increased by 87.8% to $387.6 million in Q3 2022 compared to $206.4 million in Q3 2021.
  • 2Net product revenue grew by 81.6% to $349.5 million in Q3 2022, primarily driven by BRUKINSA® and tislelizumab sales.
  • 3BRUKINSA® global sales reached $155.5 million in Q3 2022, a 136.2% increase year-over-year, with U.S. sales growing by 220.9%.
  • 4Tislelizumab sales in China increased by 66.5% to $128.2 million in Q3 2022.
  • 5Research and development expenses increased by 21.1% to $426.4 million, reflecting ongoing investment in pipeline expansion.
  • 6Selling, general, and administrative expenses rose by 19.9% to $322.9 million, supporting global commercial operations.
  • 7The company revised prior period financial statements to correct an error related to the valuation of net deferred tax assets.

Frequently Asked Questions

The primary driver for the substantial increase in Beigene's total revenue was the strong performance in net product revenue, which grew by 81.6% year-over-year. This growth was primarily fueled by increased sales of BRUKINSA® in both the U.S. and China, and continued strong sales of tislelizumab in China.

Research and Development (R&D) expenses increased by 21.1% to $426.4 million in Q3 2022 compared to the prior year period. This increase is attributed to the expansion of its global development organization and clinical pipeline. Selling, General, and Administrative (SG&A) expenses also rose by 19.9% to $322.9 million, reflecting increased hiring to support the growing business, particularly commercial organizations in key markets, and expanded professional services.

Beigene revised certain prior period financial statements to correct an error related to the valuation of net deferred tax assets. While the impact was deemed immaterial to previously filed financial statements, the correction involved recording a valuation allowance on net deferred tax assets, which adjusted previously reported income tax expenses and net losses.

As of September 30, 2022, Beigene reported cash, cash equivalents, and restricted cash of $4.2 billion and short-term investments of $872.0 million. This strong liquidity position is expected to fund operations for at least the next 12 months, despite significant investments in R&D and commercialization efforts.