Dynavax Reports Second Quarter 2022 Financial Results

Published: Aug. 4, 2022 at 12:02 PM AKDT
  • Q2 2022 total revenue of $256.5 million, up 386% from $52.8 million for Q2 2021
  • On track for second consecutive year of profitability
  • Conference call today at 4:30 p.m. ET/1:30 p.m. PT

EMERYVILLE, Calif., Aug. 4, 2022 /PRNewswire/ -- Dynavax Technologies Corporation (Nasdaq: DVAX), a commercial-stage biopharmaceutical company developing and commercializing innovative vaccines, today reported financial results and provided a business update for the quarter ending June 30, 2022.

(PRNewsfoto/Dynavax Technologies)
(PRNewsfoto/Dynavax Technologies)(PRNewswire)

"During the second quarter, we continued to successfully execute on our key priorities and are on track for another profitable year with record revenues for both HEPLISAV-B and CpG 1018 adjuvant," commented Ryan Spencer, Chief Executive Officer of Dynavax. "We are well capitalized to continue to invest in programs that drive revenue growth and deliver progress across our clinical pipeline with a focus on high value vaccine programs where our proven adjuvant may provide meaningful advantages."

SECOND-QUARTER CORPORATE HIGHLIGHTS

HEPLISAV-B® [Hepatitis B Vaccine (Recombinant), Adjuvanted]

HEPLISAV-B vaccine is the first and only adult hepatitis B vaccine approved in the U.S. and EU that enables series completion with only two doses in one month.

  • HEPLISAV-B vaccine achieved net product revenue of $32.7 million for the second quarter of 2022, up 139% compared to $13.7 million for the second quarter of 2021.
  • Market share in the accounts targeted by the Dynavax field sales team increased to approximately 39%, with total market share increasing to approximately 32% in the second quarter of 2022, up from approximately 30% and 19% respectively, in the second quarter of 2021.

CpG 1018® Adjuvant Supply for COVID-19 Vaccines

Dynavax has established a global portfolio of CpG 1018 adjuvant commercial supply agreements (CSA) currently focused on the development of COVID-19 vaccines across a variety of vaccine platforms.

  • CpG 1018 adjuvant revenue for the second quarter of 2022 was $222.6 million, up 471% compared to $39.0 million for the second quarter of 2021.
  • The Company now expects 2022 full-year CpG 1018 adjuvant COVID-19 supply revenue to be between $550 million and $600 million, based on committed orders, with an anticipated full-year gross margin of approximately 60%.

Clinical Pipeline

Dynavax is advancing a pipeline of differentiated product candidates that leverage its CpG 1018 adjuvant, which has demonstrated its ability to enhance the immune response with a favorable tolerability profile in a wide range of clinical trials and real-world commercial use.

  • Tetanus, diphtheria and pertussis (Tdap) vaccine program: Previously reported interim adult data from an on-going Phase 1 clinical trial evaluating the Company's adjuvanted Tdap vaccine candidate demonstrated it was well tolerated without safety concerns with immunogenicity data supporting continued advancement. The Company anticipates adolescent data from the same trial in the fourth quarter of 2022.
  • Shingles vaccine program: The Company recently completed enrollment in the ongoing Phase 1 study evaluating the safety, tolerability, and immunogenicity in adults compared to Shingrix, the leading marketed shingles vaccine in the U.S. Topline data is anticipated in the fourth quarter of 2022.
  • Plague vaccine candidate: The Company anticipates that in August the first participant will be dosed in a Phase 2 clinical trial evaluating the immunogenicity, safety and tolerability of a plague vaccine candidate utilizing CpG 1018 adjuvant. The clinical trial is being conducted in collaboration with, and funded by, the U.S. Department of Defense.

SECOND-QUARTER FINANCIAL HIGHLIGHTS

Total Revenues and Product Revenue, Net.
Total revenues for the second quarter of 2022 were $256.5 million, compared to $52.8 million for the second quarter of 2021.

  • U.S. HEPLISAV-B vaccine product revenue, net was $32.7 million for the second quarter of 2022, compared to $13.7 million for the second quarter of 2021. Additionally, approximately $0.9 million was reported in HEPLISAV-B net product sales associated with sales to the Company's commercialization partner in Germany, Bavarian Nordic.
  • CpG 1018 adjuvant product revenue, net was $222.6 million in the second quarter of 2022 compared to $39.0 million in the second quarter of 2021.
  • Selected financial highlights from CpG 1018 adjuvant product supply partnerships for COVID-19 vaccines and vaccine candidates:

Cost of Sales - Product. Cost of sales - product for the second quarter of 2022 increased to $83.4 million, compared to $14.8 million for the second quarter of 2021. The increase was primarily due to manufacturing costs for increased volumes of CpG 1018 adjuvant sold to COVID-19 supply partners and increased HEPLISAV-B vaccine sales volume.

Research and Development Expenses (R&D). R&D expenses for the second quarter of 2022 increased to $9.7 million, compared to $7.2 million for the second quarter of 2021. The increase was primarily driven by increased headcount-related compensation and personnel costs, including non-cash stock-based compensation, as well as investments in product candidates utilizing CpG 1018 adjuvant and additional discovery efforts.

Selling, General, and Administrative Expenses (SG&A). SG&A expenses for the second quarter of 2022 increased to $36.2 million, compared to $21.6 million for the second quarter of 2021. The increase was primarily driven by compensation and related personnel costs, including non-cash stock-based compensation, primarily associated with increased headcount as the Company expanded its field sales team to support HEPLISAV-B vaccine commercialization in mid-2021.

Interest Expense. Interest expense was $1.7 million in the second quarter of 2022, a decrease of $1.4 million from $3.1 million in the second quarter of 2021, reflecting a decreased interest rate associated with the Company's convertible senior notes due 2026.

Net Income.  GAAP net income was $128.8 million, or $1.02 per share (basic) and $0.87 per share (diluted) in the second quarter of 2022, compared to GAAP net income of $4.5 million, or $0.04 per share (basic) and $0.02 per share (diluted) in the second quarter of 2021.

Cash and Marketable Securities.  Cash and marketable securities were $518.2 million as of June 30, 2022.

2022 Financial Guidance
Dynavax anticipates 2022 revenues, operating expenses, and other costs to be in the ranges shown below, updated from the Company's previous financial guidance provided on May 5, 2022:

  • Full-year CpG 1018 adjuvant net product revenues of between $550 million and $600 million, with an associated gross margin anticipated to be approximately 60%
  • Research and development expenses to be between approximately $50-$60 million
  • Selling, general and administrative expenses to be between approximately $130-$140 million
  • Interest expense of approximately $7 million

Conference Call and Webcast Information
Dynavax will host a conference call and live audio webcast on Thursday, August 4, 2022, at 4:30 p.m. (ET)/1:30 p.m. (PT).

The live audio webcast may be accessed through the "Events & Presentations" page on the "Investors" section of the Company's website at https://investors.dynavax.com/events-presentations. A replay of the webcast will be available for 30 days following the live event.

To dial into the call, participants will need to register for the call using the caller registration link. It is recommended that participants dial into the conference call or log into the webcast approximately 10 minutes prior to the call.

Important U.S. Product Information
HEPLISAV-B is indicated for the prevention of infection caused by all known subtypes of hepatitis B virus in adults aged 18 years and older.

For full U.S. Prescribing Information for HEPLISAV-B, click here.

Important U.S. Safety Information (ISI)
Do not administer HEPLISAV-B to individuals with a history of a severe allergic reaction (e.g., anaphylaxis) after a previous dose of any hepatitis B vaccine or to any component of HEPLISAV-B, including yeast.
Appropriate medical treatment and supervision must be available to manage possible anaphylactic reactions following administration of HEPLISAV-B.
Immunocompromised persons, including individuals receiving immunosuppressant therapy, may have a diminished immune response to HEPLISAV-B.
Hepatitis B has a long incubation period. HEPLISAV-B may not prevent hepatitis B infection in individuals who have an unrecognized hepatitis B infection at the time of vaccine administration.
The most common patient-reported adverse reactions reported within 7 days of vaccination were injection site pain (23% to 39%), fatigue (11% to 17%), and headache (8% to 17%).

About Dynavax
Dynavax is a commercial-stage biopharmaceutical company developing and commercializing innovative vaccines to help protect the world against infectious diseases. The Company has two commercial products, HEPLISAV-B® vaccine [Hepatitis B Vaccine (Recombinant), Adjuvanted], which is approved in the U.S. and the European Union for the prevention of infection caused by all known subtypes of hepatitis B virus in adults 18 years of age and older, and CpG 1018 adjuvant, currently used in multiple adjuvanted COVID-19 vaccines. Dynavax is advancing CpG 1018 adjuvant as a premier vaccine adjuvant through global research collaborations and partnerships. Current collaborations are focused on adjuvanted vaccines for COVID-19, seasonal influenza, universal influenza, plague, shingles and Tdap. For more information about our marketed products and development pipeline, visit www.dynavax.com and follow Dynavax on LinkedIn.

Forward-Looking Statements
This press release contains "forward-looking" statements, including statements regarding financial guidance, the development and potential approval of vaccines containing CpG 1018 adjuvant by us or by our collaborators, potential future sales of CpG 1018 adjuvant or HEPLISAV-B vaccine, the timing of initiation and completion of clinical studies and the publication of results. Actual results may differ materially from those set forth in this press release due to the risks and uncertainties inherent in our business, including, the risk that actual demand for our products may differ from our expectations, risks related to the timing of completion and results of current clinical studies, risks related to the development and pre-clinical and clinical testing of vaccines containing CpG 1018 adjuvant, whether use of CpG 1018 adjuvant will prove to be beneficial in these vaccines, risks related to whether and when the quantity of CpG 1018 adjuvant actually purchased by vaccine companies will meet our expectations, as well as other risks detailed in the "Risk Factors" section of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 and periodic filings made thereafter, as well as discussions of potential risks, uncertainties and other important factors in our other filings with the U.S. Securities and Exchange Commission. These forward-looking statements are made as of the date hereof, and we undertake no obligation to revise or update information herein to reflect events or circumstances in the future, even if new information becomes available. Information on Dynavax's website at www.dynavax.com is not incorporated by reference in our current periodic reports with the SEC.

Contacts:
Nicole Arndt, Investor Relations and Corporate Communications
narndt@dynavax.com
510-665-7264

Derek Cole, President
Investor Relations Advisory Solutions
derek.cole@IRadvisory.com

DYNAVAX TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)




Three Months Ended 



Six Month Ended 




June 30, 



June 30, 




2022



2021



2022



2021


Revenues: 

















Product revenues, net 


$

255,320



$

52,677



$

367,647



$

135,562


Other revenue 



1,144




90




2,809




540


Total revenues 



256,464




52,767




370,456




136,202



















Operating expenses: 

















Cost of sales – product 



83,369




14,845




123,331




39,470


Research and development 



9,689




7,167




20,784




14,925


Selling, general and administrative 



36,179




21,583




68,351




44,006


Gain on sale of assets 



(1,000)




-




(1,000)




-


Total operating expenses 



128,237




43,595




211,466




98,401



















Income from operations 



128,227




9,172




158,990




37,701



















Other income (expense): 

















Interest income 



765




48




1,026




95


Interest expense 



(1,683)




(3,109)




(3,363)




(7,821)


Sublease income 



2,025




1,670




3,634




3,692


Loss on debt extinguishment 



-




(5,232)




-




(5,232)


Change in fair value of warrant liability 



-




2,097




1,801




(23,455)


Other 



40




(173)




145




384


Net income before provision for income taxes 



129,374




4,473




162,233




5,364


Provision for income taxes 



(619)




-




(619)




-


Net income 


$

128,755



$

4,473



$

161,614



$

5,364


Net income per share attributable to common stockholders 

















Basic 


$

1.02



$

0.04



$

1.29



$

0.04


Diluted 


$

0.87



$

0.02



$

1.08



$

0.04


Weighted-average shares used in computing net income per share attributable to common stockholders: 

















Basic 



126,347




114,629




125,456




113,339


Diluted 



149,905




118,830




149,821




114,978



















DYNAVAX TECHNOLOGIES CORPORATION

SELECTED BALANCE SHEET DATA

(In thousands)

(Unaudited)




June 30, 



December 31, 




2022



2021


Assets 









Cash, cash equivalents, and marketable securities 


$

518,169



$

545,950


Inventories, net 



73,979




61,335


Property and equipment, net 



36,286




35,020


Operating lease right-of-use assets 



25,785




25,964


Goodwill 



1,958




2,125


Other assets 



366,822




368,852


Total assets 


$

1,022,999



$

1,039,246











Liabilities and stockholders' equity 









Total current liabilities 


$

345,198



$

556,402


Total long-term liabilities 



255,002




260,470


Stockholders' equity 



422,799




222,374


Total liabilities and stockholders' equity 


$

1,022,999



$

1,039,246


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