OPKO Health Reports 2018 Fourth Quarter Business Highlights and Financial Results

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MIAMI, Feb. 27, 2019 (GLOBE NEWSWIRE) -- OPKO Health, Inc. (NASDAQ: OPK) reports business highlights and financial results for the three months ended December 31, 2018.

Business Highlights

  • RAYALDEE total prescriptions reported by IQVIA increased 166% in 4Q 2018 compared with 4Q 2017: Total prescriptions were approximately 9,300 during the fourth quarter of 2018. As of January 1, 2019, approximately 80% of prospective U.S. patients have access to RAYALDEE under their insurance plans. The Company continues to increase its commercial reach through expansion of its sales force.
  • Topline data from the global Phase 3 clinical trial for hGH-CTP in growth hormone deficient children is expected by the end of 2019; Enrollment completed in Japanese registration study: The global pediatric study is a pivotal, non-inferiority design comparing a single weekly administration of hGH-CTP with daily injections of a currently marketed growth hormone product. The global and Japanese pediatric studies utilize the pen device and formulation that will be launched commercially upon approval. The pediatric segment represents more than 80% of the commercial market for treatment of hGH deficiency.
  • RAYALDEE line extension trial initiated in hemodialysis patients with SHPT: Together with its partners, Vifor Fresenius and Japan Tobacco, OPKO is developing RAYALDEE for patients with Stage 5 CKD who have secondary hyperparathyroidism (SHPT) and vitamin D insufficiency and are undergoing regular hemodialysis. A Phase 2 trial in this population is currently underway in the United States.
  • Topline data from the Phase 2b study with OPK88003, a once-weekly oxyntomodulin dual GLP1-Glucagon agonist for type 2 diabetes and obesity, is anticipated during 1Q 2019: The last patient, last visit of this Phase 2b dose-escalation study occurred in February 2019. In an earlier, 420-patient Phase 2 trial in patients with type 2 diabetes, OPK88003 was similar to exenatide extended-release (Ex ER) in reducing HbA1c levels. OPK88003 showed statistically significantly greater weight loss and lowering of total cholesterol and triglycerides compared to once-weekly Ex ER, with a good safety profile.
  • Appointed Jon R. Cohen, M.D. Executive Chairman and promoted Geoff Monk as President, both for BioReference Laboratories: Dr. Cohen brings more than 30 years of healthcare experience as a seasoned strategic leader with extensive and diverse experience; his track record of expanding existing business and developing new ventures, while dealing effectively with the payor universe, is well recognized in the diagnostics industry.
  • 4Kscore® utilization remained strong during 4Q 2018 with nearly 20,000 tests performed: The 4Kscore test is a blood test that gives a man with elevated prostate specific antigen (PSA) levels a personalized prediction of his chance of having or developing an aggressive form of prostate cancer. The Company is pursuing U.S. Food and Drug Administration (FDA) approval with a submission expected in the first half of 2019. OPKO announced on January 31, 2019 that Novitas Solutions, Inc. issued a notice of a future non-coverage determination for 4Kscore effective March 20, 2019. The Company is currently making efforts to have the determination rescinded or reversed.
  • FDA approved Claros® point-of-care (POC) PSA test: On February 1, 2019, OPKO announced that the FDA approved the Company’s point-of-care Sangia Total PSA Test using the Claros 1 Analyzer. The Company is taking steps to obtain CLIA waiver for the test and analyzer, which would permit the test to be performed by most medical office personnel with minimal training, and is also planning for scale up of manufacturing capacity during 2019. OPKO plans to expand the testing menu and the next test under development is testosterone, with clinical trials currently scheduled to commence in mid-2019.
 












anonymous said:
Will OPKO stock ever get above $3/share anytime soon? 2-4 months? Options underwater.
Click to expand...


Barrington Research restated their buy rating on shares of Opko Health (NASDAQ:OPK) in a research note issued to investors on Thursday morning. The brokerage currently has a $5.00 target price on the biotechnology company’s stock. Barrington Research also issued estimates for Opko Health’s FY2023 earnings at $0.28 EPS.

“We are maintaining our OUTPERFORM investment rating on OPK shares but are reducing our 12-month price target to $5 from $7.


$5 thats it people.
 






OPKO Health, Inc. (OPK)

Q4 2018 Earnings Conference Call

February 27, 2019 4:30 PM ET

Company Participants

Miriam Miller – Investor Relations-LHA

Phillip Frost – Chairman and Chief Executive Officer

Steve Rubin – Executive Vice President

Adam Logal – Chief Financial Officer

Charlie Bishop – Chief Executive Officer–Renal Division

Jane Hsiao – Vice Chairman and Chief Technical Officer

Conference Call Participants

Maury Raycroft – Jefferies

Yale Jen – Laidlaw & Company

Mike Petusky – Barrington Research

Presentation

Operator

Welcome to the OPKO Health Incorporated Business Update Conference Call. At this time all participants are in a listen-only mode. Following management’s prepared remarks, we’ll hold a Q&A session. [Operator Instructions] As a reminder, this conference is being recorded, Wednesday February 27, 2019.

I would now like to turn the call over to Miriam Miller. Please go ahead, ma’am.

Miriam Miller

Thank you, operator. Good afternoon. This is Miriam Miller with LHA. Thank you for all for joining today’s call. I’d like to remind you that any statements made during this call by management other than statements of historical fact will be considered forward-looking and as such, will be subject to risks and uncertainties that could materially affect the company’s expected results. Those forward-looking statements include, without limitation, the various risks described in the company’s annual report on Form 10-K for the year ended December 31, 2018, and subsequent quarterly reports on Form 10-Q.

Importantly, this conference call contains time-sensitive information that is accurate only as of the date of the live broadcast, February 27, 2019. Except as required by law, OPKO undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call.

Before we begin, let me review the format for today. Dr. Phillip Frost, Chairman and Chief Executive Officer, will open the call; followed by Steve Rubin, OPKO’s Executive Vice President, who will provide an update on the company’s various business and clinical programs. After that, Adam Logal, OPKO’s Chief Financial Officer, will review the company’s fourth quarter and fiscal year 2018 financial performance. Dr. Frost will provide closing remarks, and then we’ll open up the call to questions.

Now let me turn the call over to Dr. Frost.

Phillip Frost

Thank you very much. I would like to open the call by highlighting a few topics that I think are important. First I’ll mention BioReference Laboratories, our diagnostics unit. And an important story here I believe is the new people that are present in this business. Dr. Jon Cohen has joined the company following Dr. Geoff Monk not too long ago. And between the two of them, I think we will have an unparalleled leadership group to drive the business forward in a way that is very important as this business is in a state of I think rapid evolution and I think we have the right team in place to deal with it.

Next I’ll mention the 4Kscore test. As you know, we recently received a negative LCD from the CMS contractor Novitas to say the least we were disappointed, but more than that we were surprised because we had been interacting with Novitas in a way that led us to believe that we were responding to their queries. In any case, we will make every effort to reverse this decision and in the meantime we're working on a submission package for FDA approval of the product.

It's a great product. It's a great test. And we just finished a two day meeting of a greatly expanded salesforce and they left fully convinced that this test so important to the men, who were suspected of having prostate cancer or of developing prostate cancer will be a commercial success and continue to grow going forward. For the moment we'll rely on other payers and cash sales as well as foreign sales and in this regard I’ll mention in tiny country of Israel, which started distributing the product not too long ago and the growth has been dramatic and their projections are if all goes well to have a number of tests used at by the end of this year, representing a significant portion of the sales that we achieved in America quite dramatic.

Finally, I'll mention RAYALDEE. This is a great product and as you know it's the only one to raise the 25-hydroxy vitamin D levels in the blood while at the same time lowering parathyroid hormone levels, all of this in chronic kidney disease patients. So again, here is a product that we're very optimistic on and we'll have important new papers that are about to be published that will highlight the unique features of this product and we think will provide the impetus for growth of the product. Because of our optimism, we're in the midst of greatly expanding the salesforce that will tell the story to the nephrologist, who were the main prescribers of the product. And finally – and Steve Rubin will expand on this, we’re engaged in clinical trials that will expand the indications for the product and results its distribution in other countries. Steve?

Steve Rubin

Thank you, Phil, and good afternoon everyone. 2018 was an eventful year. As with the first couple months of 2019, we've seen a number of successes during that time. 2018 saw improved quarter-over-quarter sales for RAYALDEE and we also completed enrolment in trials for type 2 diabetes and obesity and growth hormone deficiency. Through the efforts of our partner, Vifor Fresenius, RAYALDEE was approved in Canada and we initiated additional clinical trials including the Phase 2 clinical trial for higher dose RAYALDEE to treat Stage 5 CKD that will expand the breadth of RAYALDEE indications.
 






As Phil noted, we appointed a new leadership team at BRL, our BioReference Labs, with Geoff Monk now serving as President and Dr. Jon Cohen joining us as Executive Chairman. Both gentlemen have deep expertise and extensive relevant experience in the management and growth of lab services and we are very pleased that they chose to join BRL. Through its GenPath Oncology diagnostics division, BRL forged that collaboration with the National Cancer Institute to participate in the institute’s precision medical clinical trial known as NCI-MATCH. In this trial, patients are assigned to receive treatment based on the genetic changes found in their tumors through genomic sequencing and other tests. We are pleased to be selective with this collaboration as it puts our GenPath Oncology diagnostics on the cutting edge of genetically based cancer therapy development.

GeneDx reached another high impact milestone in June with the announced completion of 100,000 additional individual exome sequences representing one of the largest cohorts of sequence exomes by an independent clinical laboratory in the world. GeneDx has now surpassed to 140,000 exome work. This work is important because the information we gathered from the body of sequences can be used to help diagnose and therefore better manage disease, more specifically identifying variations in genes that may lead to a variety of neurological, metabolic or other disorders. GeneDx’s R&D program continues to launch many new tests and has about 40 tests slated to launch this year alone, which will enable GeneDx to enter a number of new clinical markets.

Most recently we announced the FDA approval of our point-of-care Sangia Total PSA tests with the Claros 1 Analyzer. There are 25 million PSA tests performed in the United States annually, so this approval represents a significant market opportunity. We believe there are many advantages both to patients and to physicians in offering test results right at the point-of-care. Further with the momentum of this approval, we will continue our work to expand the test menu on this technology platform. We are also taking steps to attain CLIA waiver for the test and analyzer, which would permit the test to be performed by most medical office personnel with minimal training in a planning for scale up of our manufacturing capacity during 2019 as necessary for commercial launch. 2018 was also a year for challenges.
 






Phil already noted the Novitas decision regarding our 4kscore test. And we are evaluating options to appeal the decision and undertake other steps with the centers for Medicare and Medicaid services to have 4kscore covered from Medicare patients. We will keep you apprised of our progress as our path forward is clarified. And as you also know in late December we and Dr. Frost settled irrelevant actions brought against us in an SEC complaint each without admitting or denying any of the allegations. The settlement ends what would have been an expensive contentious and time consuming litigation that will continue to negatively impact the wellbeing of the company and the focus of our employees and management. We are pleased to put this behind us, so we can continue our work unimpeded by this unfortunate turn of events.

And as a final topic in February, we successfully raised $200 million to the issuance of 4.5% convertible senior notes due 2025. Adam will cover this in greater detail, but this financing provides Opko with sufficient funding to accelerate our research and development efforts. It still provides us with the ability to reinvest in our commercial activities. I will now go into a bit more detailed overview of our programs. Looking at specific diagnostic products, as you know, our 4Kscore blood test gives a man with elevated PSA levels, a personalized prediction of his chance of having or developing an aggressive form of prostate cancer.

In 2018 we processed over 79,000 tests, representing a 4% increase compared with 2017. 4Kscore tests performed in the fourth quarter increased by almost 6% from Q3 2018 to 19,500 tests. Although this represented a 5% decrease from the comparable quarter in 2017, test process for urologists where we are now primarily focusing our sales efforts, grew 12% in 2018 compared to 2017. We intend to submit the 4Kscore test to the FDA for approval or clearance during the second quarter.

I think everyone on this call understands the importance of 4Kscore and believes in the need for this test. To restate its credentials, 4Kscore test has been ordered by more than 12,000 practicing physicians worldwide with over 200,000 test orders. The test has been extensively studied in more than 25,000 patients with results presented an 18 peer-reviewed scientific publications. Results of five new studies covering the 4Kscore test were presented at the American Urological Association's 2018 Annual Meeting, including a study demonstrating the test’s ability to stratify risk of prostate cancer mortality in men with elevated PSA.

For pharmaceuticals, turning now to that portion of our business, let me start with RAYALDEE, the first and only therapy approved by the FDA that both raises 25-hydroxy vitamin D and lowers parathyroid hormone levels in patients with chronic kidney disease with a safety profile similar to placebo. We are continuing to build sales momentum and have seen a growth of 250% in total prescriptions for 2018 versus 2017. Total prescriptions of RAYALDEE in Q4 as reported by IQVIA increased 21%, compared with Q3, new patients 12% in Q4, versus Q3.

Since launch, there had been a total of approximately 7,500 patients on RAYALDEE. We have also increased the number of healthcare providers who prescribe RAYALDEE. As of Q4 over 1,700 prescribers have written RAYALDEE, of which over 200 were new prescribers. We ended 2018 with RAYALDEE being available to over 80% of the overall insured population with over 60% unrestricted coverage of the Medicare population. Overall, we continue to see progress in adoption, reimbursement and awareness of RAYALDEE. Our sales team continues to demonstrate impact, and our market penetration continues to grow.

Regarding our clinical development programs, we remain focused on progressing our portfolio addressing indications with significant, unmet medical needs in large markets. We have a robust pipeline of candidates at various stages of development, which provides attractive opportunities for creating near-term and long-term value for our shareholders.
 






Starting with our work in renal, our partner Vifor Fresenius remains on track to file a Market Authorisation Application with the European Medicines Agency later this year as a treatment for SHPT and CKD patients.

In September, we initiated a global Phase 2 trial with a higher strength RAYALDEE in patients with stage five CKD and vitamin D insufficiency, who require regular dialysis. Cost of this study will be shared with our development partner Vifor Fresenius and Japan Tobacco. The first cohort of approximately 44 patients will be treated for 26 weeks in a randomized, open-label fashion with either RAYALDEE or placebo to identify the appropriate dosing to be studied in the second cohort. Initial data readout for this first cohort is expected this year.

The second cohort of more than 200 patients will be treated for 26 weeks in a randomized, double-blind fashion with one of three different doses of RAYALDEE or placebo. The primary efficacy endpoint will be correction of vitamin D insufficiency and control of SHPT. Patients will then be treated with RAYALDEE for another 26 weeks in an open-label extension.

Turning to our metabolic and endocrinology pipeline, we have several late-stage programs underway or nearing initiation. As you know our long long-acting human growth hormone product, somatrogon, or hGH-CTP is partnered with Pfizer for worldwide commercialization. We were pleased to announce in August that we completed enrollment in our global Phase 3 study in growth hormone deficient children. Pediatric indications represent more than 80% of the hGH market. This is a pivotal, non-inferiority study comparing for a 12-month period single weekly injection of Somatrogon with daily injections of GENOTROPIN.

This 228 patient study uses the pen device and formulation intended for commercial launch. We're hopeful that the outcomes will support a dosing change from daily to weekly administration and positively impact the quality of life for children with growth hormone deficiency. With a 12-month primary end point, as mentioned, we expect to report top-line results from this study in Q4 of this year. We recently completed enrollment and a 44-patient Phase 2 study evaluating the effect of hGH-CTP on safety and growth of pediatric patients in Japan. The study compares once weekly hGH-CTP with a once-daily GHD product and is required for a future Somatrogon submission to the Japanese regulatory authorities.

Turning to our work with OPK88004, a selective androgen receptor modulator that has the ability to serve as an agonist resulting in increased anabolic effects, such as increased lean body mass and physical function and decreased fat mass and as an antagonist to androgen receptors in the prostate. These promising clinical data suggest that OPK88004 can be used for the treatment of a number of symptoms such as frailty, decreased physical function and quality of life parameters associated with aging and low testosterone levels.

In a press release on January 31 we announced that we are suspending the BPH trial as it was originally designed due to variability and measuring changes of prostate volume and transient increases in liver enzymes observed in several men at these higher doses. The liver enzyme levels resolved after the drug was withdrawn. Based on the positive anabolic effects of OPK88004 observed in a 420-patient study in aging males, we are planning a Phase 2 clinical study to assess the drug in prostate cancer patients treated with Androgen Deprivation Therapy or ADT. ADT lowers testosterone to castration levels resulting in a number of side effects as a decreased lean body mass, physical function, bone quality and increases in body fat, frailty and hot flashes.

The diminished quality of life results in approximately one-third of men treated with ADT stopping treatment within six months of initiation. Because of OPK88004 selective androgen activity, it may be well suited to treat the severe side effects associated with ADT in men with prostate cancer. Approximately one million men are receiving ADT therapy in the United States.
 






In mid-June, we reported that enrollment in our Phase 2b dose escalation trial for our once-weekly GLP1 glucagon dual agonist oxyntomodulin, for the treatment of Type 2 diabetes and obesity. This study includes 115 Type 2 diabetics at 35 clinical sites in the U.S. and was designed to assess a dosing regimen that is expected to improve weight loss, and glucose control and to demonstrate an acceptable safety profile as a drug candidate is prepared to advancing the Phase 3 studies. We completed this study earlier this month and we expect to report the findings from this study in March of this year.

So in closing, 2018 and the first part of 2019 has been a busy period for us with both successes and challenges. Yet we affirm our commitment to our business model and our product pipeline. We have advanced multiple products across our diverse portfolio and continue to see increases in sales and performance indicators for RAYALDEE. We are pleased to have received FDA approval for Claros 1. And we applaud our partner, Vifor Fresenius for their work to secure approval for RAYALDEE in Canada. And we look forward to the global expansion of the RAYALDEE franchise in partnership with Japan Tobacco and Vifor Fresenius.

We are pleased to announce completion of enrollment in both our pediatric hGH and diabetes programs. These milestones represent significant progress in our department of these therapeutics. We are advancing a robust clinical development program that addresses several large markets. We expect to make meaningful progress with these programs and to achieve several important milestones.

And with that overview, let me turn the call over to Adam for discussion of our fourth quarter and full year financial performance.

Adam Logal

Thank you, Steve. During the last few months, we strengthened our balance sheet through two separate financing transactions. In November we completed a $93 million equity offering with Dr. Frost, Dr. Hsiao, and our other long-term investors, which resulted in our ending cash balance at $96.5 million. Additionally, on February 5, we completed the $200 million convertible debt offering. In connection with the closing of the convertible debt offering, we terminated the $60 million unsecured line of credit with Dr. Frost. These financing transactions have provided us with the flexibility to accelerate our R&D efforts while providing us with the ability to reinvest into our commercial activities. As Steve mentioned, we are expanding our commercial organization for RAYALDEE to accelerate the growth rates for that line of business. In addition, the R&D initiatives Steve mentioned had been competing for available funds and those financings provide us with the ability to accelerate those programs.

Overall, our financial performance during the fourth quarter came in slightly below our own expectations, as a result of the challenging quarter for the lab industries overall as well as some non-recurring, non-cash impairments we’ve recorded. Overall, our net loss during the fourth quarter of 2018 decreased to $76.1 million or $0.13 per share compared to a net loss of $217.9 million or $0.39 per share for the comparable period of 2017. Our revenues improved to $221.9 million for the fourth quarter of 2018 compared to $161 million for the 2017 period.

Moving to costs and expenses, we continued to invest in our R&D projects, where we incurred $33.3 million for the fourth quarter of 2018 compared to $34.2 million for the 2017 period. In addition, during the fourth quarter of 2018, we’ve recorded a non-cash impairment charge for our goodwill and in-process research and development programs of $21.8 million. These charges principally relate to our API business, which lost a significant customer during the fourth quarter, as well as the suspension of our BPH clinical trial for our SARM, which Steve discussed.
 






Moving to our lab business, revenue from services increased to $183.1 million, compared to $119.4 million for the comparable period of 2017. As a reminder, the 2017 period included $73.3 million of revenue adjustments. Overall, reimbursement within our lab business continues to be challenging within our esoteric testing business, including GeneDx, where denial rates are increasing as payers increase preauthorization requirements. Our payer team is identifying ways for us to prevent those denials in the first instance, and our billing team is working diligently on improving our overall appeal success rates. Continuing to improve our cost to serve remains an important focus as we will see another year of reimbursement headwinds led by the impact of PAMA.

Regarding our pharmaceutical divisions performance, we recognize $6 million of revenue related to the sales of RAYALDEE during the quarter. We saw the impact of improved payer coverage and access, including expanded Medicare coverage that has impacted our gross to net revenue calculations. Going forward, we anticipate our net revenue to remain 50% and 55% of gross revenues, which reflects an increase in our estimated sales returns and allowances.

Total pharmaceutical product revenue for the quarter is $25.4 million, compared to $33.8 million for the 2017 period. The fourth quarter of 2017 included the recognition of RAYALDEE shifts from the launch through the end of 2017, which was $9.1 million. Revenue related to the transfer of intellectual property for the fourth quarter was $13.4 million, compared to $7.8 million for the 2017 period.

Looking forward to the first quarter of 2019, we expect revenue from services to be between $175 million and $190 million. This anticipated decrease is principally the result of our continuing reimbursement decline within – with the range reflecting various volume expectations.

Turning to product revenues for the first quarter, we expect them to come in between $25 million and $28 million including RAYALDEE revenues between $6.7 million and $7.5 million while revenues from the transfer of intellectual property are expected to be between $15 million and $20 million. Looking at anticipated expenses for the first quarter, we expect costs and expenses to be between $280 million and $290 million including research and development expense of $33 million to $38 million.

With that, I’ll turn back – the call back to Dr. Frost for any final comments.

Phillip Frost

I don’t have any other comments and will open the floor for questions if there are any.

Question-and-Answer Session

Operator

[Operator Instructions] And our first question is from the line of Maury Raycroft from Jefferies.

Maury Raycroft

Hi everyone, congrats on the progress and thanks for taking my questions. First question is on RAYALDEE, so at the beginning of the call you mentioned that there’s some new publications that could be coming out soon. Can you provide any general preview as to what it – what to expect in those publications and when we could see them?

Phillip Frost

I’ll let our expert in vitamin D, Charlie Bishop respond.

Charlie Bishop

All right. Thanks for the question. We have a paper that’s been accepted for publication in the American Journal of Nephrology, which is entitled rationale for increasing the serum total 25D target in CKD. The paper shows for the first time with prospective data that the serum total 25D or vitamin D target is not where the clinical practice guidelines have placed it at 30 nanograms/mil rather it’s substantially higher. And that means that the standard of care, which is used to correct vitamin D insufficiency in CKD patients is completely unable to reach that target. 90% of CKD patients were treated with nutritional vitamin D. And our data, which will be coming out very shortly, show that nutritional vitamin D simply cannot reach that level.
 






RAYALDEE on the other hand, is the ideal therapy for raising serum total 25D levels. It makes sense that if you want to increase the vitamin D levels in the blood, you give 25-hydroxy D and that’s the active in RAYALDEE. We can raise serum total 25D easily to the level that our data show is required in order to control elevated PTH.

Maury Raycroft

Got it. That’s very helpful. And will these publications, I assume they’re going to be used to some extent, while marketing could some of the data or potentially even the reference be added to the label RAYALDEE?

Charlie Bishop

That’s a great question. So, accompanying this particular publication, which was scheduled to come out in February, but it’s delayed, because there’s going to be a cover editorial by an independent author and we’re waiting for that editorial to be drafted. Both the paper and the editorial will be used in our promotional efforts and we’re preparing for that right now and there’s possibility that we might be able to get clarifications in our label as well.

Maury Raycroft

Got it. Okay. And also for RAYALDEE, you mentioned that you just started recruiting for the Phase 2 in hemodialysis patients with that SHPT and you have the ongoing Phase 4 in a CKD and VDI with SHPT. So first, I’m wondering how important is that Phase 4 that’s going and when could we expect an update from that trial and then for both the Phase 2 and the Phase 4, can you provide any more context and how the data could be used for commercial efforts?

Charlie Bishop

Yes, great question. So, we do have a Phase 4 study ongoing that’s comparing RAYALDEE to commonly used treatment regimens in the United States as well as in Europe. The day they will help us from a promotional standpoint, provided that they turned out positively, which we expect. They also will help us with our pending filing in Europe with – for RAYALDEE as a treatment for secondary hyperparathyroidism in Stage 3, Stage 4 CKD. The European filing requires a comparison against immediate release calcifediol, which that is one of the comparative arms in this space for a study. We’re confident from the early data that the results will be very good. timeline for finishing this study will be later this year. This is an open label study. So, we’re able to track the data as we go.

With regard to the dialysis study that’s ongoing. The medical textbooks teach the RAYALDEE can’t possibly work in a patient that doesn’t have a functional kidney. But our data from phase 3 trials in Stage 3 and Stage 4 CKD show that the PTH lowering response with RAYALDEE is identical in Stage 3 and Stage 4 and is independent of eGFR. The rationale for this is that RAYALDEE gets activated outside the kidney and our package insert allow us for that possibility. So, we’re going to be very excited to report later this year. The results from our ongoing dialysis study.

Maury Raycroft

great. Okay. Thank you very much. I’ll hop back in the queue.

Phillip Frost

Any other questions?

Operator

Indeed, our next question is from the line of Yale Jen from Laidlaw & Company.

Yale Jen

Good afternoon and thanks for taking the questions. And first, add in that, that appreciate that you provide first quarter of 2019 guidance. So that’s very helpful for monitoring purpose, but would you be able to provide a little more longer-term sort of projection for the full year 2019 in terms how do you see the top line as well as the operating expenses on an annualized basis?

Adam Logal

Thanks, Yale. So we’re – we obviously gave Q1 guidance. We’ll continue to provide updates as the year progresses. I think there is some uncertainty for us on the overall outlook, just given the 4K reimbursement challenges and headwinds that we’re facing. In addition that we – some, the way the lab industry has been kind of pretty choppy in the fourth quarter. We’re starting to see some rebound here in the first quarter, but obviously based on the guidance I provided, it was – we are expecting to come to come in lower than prior year. So, I think as we think about the year we want to get some more time behind us. Yes. From an OpEx perspective, we do think the lab business will continue to pull out efficiencies, as we did in 2018, and Jeff and the team there are very focused on any challenges that we have on the top line has to be addressed through the operating expense lines.
 






Yale Jen

Okay. That’s very helpful. I appreciate it. In terms of timeline for the clear waiver for the Claros PSA test, is there any timeline in terms of how that maybe completed or being approved I guess?

Steve Rubin

It’s a little Yale, too early for me to answer that. So, we’re going to have our presubmission discussion with FDA shortly, which will give us a little insight, but it’s a little premature for me to answer that now.

Jane Hsiao

In addition, FDA actually just finalizing their guidance in terms of CLIA waiver. Yes.

Yale Jen

Okay. That’s very helpful. And maybe, the last question here is that in terms of submitting 4Kscore for FDA approval. first of all, have you guys spoke with agency regarding whether there is any, would be – would there be any sort of study need of it and on a longer-term, if you get approve, how would you see that potentially benefit on the sort of commercial side in terms of the commercial.

Jane Hsiao

I can address the FDA question. This is Jane Hsiao. We have been…

Yale Jen

Hi, how are you?

Jane Hsiao

Hi. Good. So, we have been working with FDA about requirement for 4Kscore test, review and approved by FDA. So, guidance has been provided to us. And over the last year to 18 months, we’ve been working on diligently to generate the data, both from the laboratory performance requirement to feel clinical studies. So, we are at the end of completing all those and that’s why we feel comfortable. Their submission to agency is going to happen shortly.

Yale Jen

And there’s no – go ahead. I’m sorry.

Steve Rubin

No. Go ahead. Finish up, Yale.

Yale Jen

Is there any sort of clinical study will be needed, additional clinical study will be needed or you can just submit what you have sort of complete in the near future and to submit that the package?

Jane Hsiao

In deed there’s additional clinical study, basically more from the performance aspect and which were done. So, to just give you some example of the type of clinical study FDA asked for is they wanted us to do it in the clinic and showing that the 4K together with the standard of care for diagnosing prostate cancer is consistent with what our claim and you had to do the 4K at the various level of PSA at a different level and things like that. So we know, we complete all those tests.

Steve Rubin

And the commercial value of it actually, Yale, it is, we think it will add value there. There is even though the clinical laboratory review is quite rigorous, especially, New York State licenses are like. It still remained a premature round and FDA approval. And additionally, it is one of those items that Novitas had it continually in their draft reports, who adapt coverage determination. So, we think it will be very useful for us to have it.

Yale Jen

So, could you theoretically also resubmit to the Novitas once you get an FDA approval instead of just CLIA up for this?

Steve Rubin

Of course. Yes. It would be something, obviously, new important information that they themselves at tab indicated is important, so…

Yale Jen

Okay, great. Thanks a lot and I appreciate taking the questions.

Phillip Frost

Okay. Any other questions?

Operator

[Operator Instructions] Our next question is wine of Mike Petusky from Barrington Research.

Mike Petusky

Thank you. A few questions. Earlier there was a comment that you guys would be greatly expanding the RAYALDEE, the sales force, I guess what’s the current number of sales reps on RAYALDEE and then what’s the guideline for how much you’re expanding that?

Steve Rubin

Yes. We currently have 64 sales reps and six managers that are in place. We’ve expanded right now by about 20% and we’re considering the timing of doing additional expansion.

Mike Petusky

So it’s 20% off of 64 or 60.

Steve Rubin

Yes. So, currently, we have plans for mid-70s of sales reps to be in place in the field in April and we’re moving forward with evaluation of whether or not to move forward with additional people, what the timing is for that this year.
 






Mike Petusky

Okay, okay. And then just – thank you. And then moving on to BRL, the – Adam, do you have the like segment margin there, EBITDA margins, op margins, , anything like that for the quarter?

Adam Logal

Yes. So, Mike we haven’t – we haven’t filed our K, we filed our K by the end of the week. So, I haven’t – I’m kind of limited to what we put out a press release.

Mike Petusky

Okay. Do you by any chance since the case is not going to be filed tonight – do you have any ability to fill in like DNA for the quarter, CapEx for the court or anything like that or…

Adam Logal

Yes. I mean DNA is consistent with last quarter. So, I don’t – there wouldn’t be any surprises within there.

Mike Petusky

Okay, CapEx?

Adam Logal

CapEx was marginally down.

Mike Petusky

Okay. Stock comps, do you have any recollection of that one?

Adam Logal

Yes. Again, it’s consistent with last quarter. They weren’t meaningful changes there.

Mike Petusky

Okay. All right. And forgive me, Adam, I may have missed this. I briefly was off the call for about 30 seconds. It sounded like you may have been answering this, but are you guys – essentially, the expectation given the reimbursement headwinds at BRL? Are you guys essentially expecting kind of down revenue year for 2019?

Adam Logal

So, I think we’re not – I don’t want to get ahead of ourselves. I do think that that Q1 is particularly challenging and uncertain coming off the year-end volumes that we saw. We’ve been bullish on volume potentials and it remained that way. I think we’ll get to have a better sense of the reimbursement improvement [ph] over these next couple of weeks and in May, should be able to provide a broader outlook.

Mike Petusky

Okay. All right. Thank you.

Operator

[Operator Instructions]

Phillip Frost

Well, if there are no other questions, I want to thank all the participants today and we look forward to greeting you at the call to commemorate the end of the first quarter.

Adam Logal

Okay. Thank you.

Operator

Thanks. Ladies and gentlemen, that does conclude your conference call for today. We thank you for your participation and ask that you please disconnect your lines.
 






anonymous said:
Phil already noted the Novitas decision regarding our 4kscore test. And we are evaluating options to appeal the decision and undertake other steps with the centers for Medicare and Medicaid services to have 4kscore covered from Medicare patients. We will keep you apprised of our progress as our path forward is clarified. And as you also know in late December we and Dr. Frost settled irrelevant actions brought against us in an SEC complaint each without admitting or denying any of the allegations. The settlement ends what would have been an expensive contentious and time consuming litigation that will continue to negatively impact the wellbeing of the company and the focus of our employees and management. We are pleased to put this behind us, so we can continue our work unimpeded by this unfortunate turn of events.

And as a final topic in February, we successfully raised $200 million to the issuance of 4.5% convertible senior notes due 2025. Adam will cover this in greater detail, but this financing provides Opko with sufficient funding to accelerate our research and development efforts. It still provides us with the ability to reinvest in our commercial activities. I will now go into a bit more detailed overview of our programs. Looking at specific diagnostic products, as you know, our 4Kscore blood test gives a man with elevated PSA levels, a personalized prediction of his chance of having or developing an aggressive form of prostate cancer.

In 2018 we processed over 79,000 tests, representing a 4% increase compared with 2017. 4Kscore tests performed in the fourth quarter increased by almost 6% from Q3 2018 to 19,500 tests. Although this represented a 5% decrease from the comparable quarter in 2017, test process for urologists where we are now primarily focusing our sales efforts, grew 12% in 2018 compared to 2017. We intend to submit the 4Kscore test to the FDA for approval or clearance during the second quarter.

I think everyone on this call understands the importance of 4Kscore and believes in the need for this test. To restate its credentials, 4Kscore test has been ordered by more than 12,000 practicing physicians worldwide with over 200,000 test orders. The test has been extensively studied in more than 25,000 patients with results presented an 18 peer-reviewed scientific publications. Results of five new studies covering the 4Kscore test were presented at the American Urological Association's 2018 Annual Meeting, including a study demonstrating the test’s ability to stratify risk of prostate cancer mortality in men with elevated PSA.

For pharmaceuticals, turning now to that portion of our business, let me start with RAYALDEE, the first and only therapy approved by the FDA that both raises 25-hydroxy vitamin D and lowers parathyroid hormone levels in patients with chronic kidney disease with a safety profile similar to placebo. We are continuing to build sales momentum and have seen a growth of 250% in total prescriptions for 2018 versus 2017. Total prescriptions of RAYALDEE in Q4 as reported by IQVIA increased 21%, compared with Q3, new patients 12% in Q4, versus Q3.

Since launch, there had been a total of approximately 7,500 patients on RAYALDEE. We have also increased the number of healthcare providers who prescribe RAYALDEE. As of Q4 over 1,700 prescribers have written RAYALDEE, of which over 200 were new prescribers. We ended 2018 with RAYALDEE being available to over 80% of the overall insured population with over 60% unrestricted coverage of the Medicare population. Overall, we continue to see progress in adoption, reimbursement and awareness of RAYALDEE. Our sales team continues to demonstrate impact, and our market penetration continues to grow.

Regarding our clinical development programs, we remain focused on progressing our portfolio addressing indications with significant, unmet medical needs in large markets. We have a robust pipeline of candidates at various stages of development, which provides attractive opportunities for creating near-term and long-term value for our shareholders.
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Has your paycheck grown 250%? New patients grew only 12%, shocker.
 






anonymous said:
Moving to our lab business, revenue from services increased to $183.1 million, compared to $119.4 million for the comparable period of 2017. As a reminder, the 2017 period included $73.3 million of revenue adjustments. Overall, reimbursement within our lab business continues to be challenging within our esoteric testing business, including GeneDx, where denial rates are increasing as payers increase preauthorization requirements. Our payer team is identifying ways for us to prevent those denials in the first instance, and our billing team is working diligently on improving our overall appeal success rates. Continuing to improve our cost to serve remains an important focus as we will see another year of reimbursement headwinds led by the impact of PAMA.

Regarding our pharmaceutical divisions performance, we recognize $6 million of revenue related to the sales of RAYALDEE during the quarter. We saw the impact of improved payer coverage and access, including expanded Medicare coverage that has impacted our gross to net revenue calculations. Going forward, we anticipate our net revenue to remain 50% and 55% of gross revenues, which reflects an increase in our estimated sales returns and allowances.

Total pharmaceutical product revenue for the quarter is $25.4 million, compared to $33.8 million for the 2017 period. The fourth quarter of 2017 included the recognition of RAYALDEE shifts from the launch through the end of 2017, which was $9.1 million. Revenue related to the transfer of intellectual property for the fourth quarter was $13.4 million, compared to $7.8 million for the 2017 period.

Looking forward to the first quarter of 2019, we expect revenue from services to be between $175 million and $190 million. This anticipated decrease is principally the result of our continuing reimbursement decline within – with the range reflecting various volume expectations.

Turning to product revenues for the first quarter, we expect them to come in between $25 million and $28 million including RAYALDEE revenues between $6.7 million and $7.5 million while revenues from the transfer of intellectual property are expected to be between $15 million and $20 million. Looking at anticipated expenses for the first quarter, we expect costs and expenses to be between $280 million and $290 million including research and development expense of $33 million to $38 million.

With that, I’ll turn back – the call back to Dr. Frost for any final comments.

Phillip Frost

I don’t have any other comments and will open the floor for questions if there are any.

Question-and-Answer Session

Operator

[Operator Instructions] And our first question is from the line of Maury Raycroft from Jefferies.

Maury Raycroft

Hi everyone, congrats on the progress and thanks for taking my questions. First question is on RAYALDEE, so at the beginning of the call you mentioned that there’s some new publications that could be coming out soon. Can you provide any general preview as to what it – what to expect in those publications and when we could see them?

Phillip Frost

I’ll let our expert in vitamin D, Charlie Bishop respond.

Charlie Bishop

All right. Thanks for the question. We have a paper that’s been accepted for publication in the American Journal of Nephrology, which is entitled rationale for increasing the serum total 25D target in CKD. The paper shows for the first time with prospective data that the serum total 25D or vitamin D target is not where the clinical practice guidelines have placed it at 30 nanograms/mil rather it’s substantially higher. And that means that the standard of care, which is used to correct vitamin D insufficiency in CKD patients is completely unable to reach that target. 90% of CKD patients were treated with nutritional vitamin D. And our data, which will be coming out very shortly, show that nutritional vitamin D simply cannot reach that level.
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Rayaldee shifts? RAYALDEE revenues between $6.7 million and $7.5 million ?
 






Yale Jen

Okay. That’s very helpful. I appreciate it. In terms of timeline for the clear waiver for the Claros PSA test, is there any timeline in terms of how that maybe completed or being approved I guess?

Steve Rubin

It’s a little Yale, too early for me to answer that. So, we’re going to have our presubmission discussion with FDA shortly, which will give us a little insight, but it’s a little premature for me to answer that now.

Jane Hsiao

In addition, FDA actually just finalizing their guidance in terms of CLIA waiver. Yes.

Yale Jen

Okay. That’s very helpful. And maybe, the last question here is that in terms of submitting 4Kscore for FDA approval. first of all, have you guys spoke with agency regarding whether there is any, would be – would there be any sort of study need of it and on a longer-term, if you get approve, how would you see that potentially benefit on the sort of commercial side in terms of the commercial.

Jane Hsiao

I can address the FDA question. This is Jane Hsiao. We have been…

Yale Jen

Hi, how are you?

Jane Hsiao

Hi. Good. So, we have been working with FDA about requirement for 4Kscore test, review and approved by FDA. So, guidance has been provided to us. And over the last year to 18 months, we’ve been working on diligently to generate the data, both from the laboratory performance requirement to feel clinical studies. So, we are at the end of completing all those and that’s why we feel comfortable. Their submission to agency is going to happen shortly.

Yale Jen

And there’s no – go ahead. I’m sorry.

Steve Rubin

No. Go ahead. Finish up, Yale.

Yale Jen

Is there any sort of clinical study will be needed, additional clinical study will be needed or you can just submit what you have sort of complete in the near future and to submit that the package?

Jane Hsiao

In deed there’s additional clinical study, basically more from the performance aspect and which were done. So, to just give you some example of the type of clinical study FDA asked for is they wanted us to do it in the clinic and showing that the 4K together with the standard of care for diagnosing prostate cancer is consistent with what our claim and you had to do the 4K at the various level of PSA at a different level and things like that. So we know, we complete all those tests.

Steve Rubin

And the commercial value of it actually, Yale, it is, we think it will add value there. There is even though the clinical laboratory review is quite rigorous, especially, New York State licenses are like. It still remained a premature round and FDA approval. And additionally, it is one of those items that Novitas had it continually in their draft reports, who adapt coverage determination. So, we think it will be very useful for us to have it.

Yale Jen

So, could you theoretically also resubmit to the Novitas once you get an FDA approval instead of just CLIA up for this?

Steve Rubin

Of course. Yes. It would be something, obviously, new important information that they themselves at tab indicated is important, so…

Yale Jen

Okay, great. Thanks a lot and I appreciate taking the questions.

Phillip Frost

Okay. Any other questions?

Operator

[Operator Instructions] Our next question is wine of Mike Petusky from Barrington Research.

Mike Petusky

Thank you. A few questions. Earlier there was a comment that you guys would be greatly expanding the RAYALDEE, the sales force, I guess what’s the current number of sales reps on RAYALDEE and then what’s the guideline for how much you’re expanding that?

Steve Rubin

Yes. We currently have 64 sales reps and six managers that are in place. We’ve expanded right now by about 20% and we’re considering the timing of doing additional expansion.

Mike Petusky

So it’s 20% off of 64 or 60.

Steve Rubin

Yes. So, currently, we have plans for mid-70s of sales reps to be in place in the field in April and we’re moving forward with evaluation of whether or not to move forward with additional people, what the timing is for that this year.
 






anonymous said:
MIAMI, Feb. 27, 2019 (GLOBE NEWSWIRE) -- OPKO Health, Inc. (NASDAQ: OPK) reports business highlights and financial results for the three months ended December 31, 2018.

Business Highlights

  • RAYALDEE total prescriptions reported by IQVIA increased 166% in 4Q 2018 compared with 4Q 2017: Total prescriptions were approximately 9,300 during the fourth quarter of 2018. As of January 1, 2019, approximately 80% of prospective U.S. patients have access to RAYALDEE under their insurance plans. The Company continues to increase its commercial reach through expansion of its sales force.
  • Topline data from the global Phase 3 clinical trial for hGH-CTP in growth hormone deficient children is expected by the end of 2019; Enrollment completed in Japanese registration study: The global pediatric study is a pivotal, non-inferiority design comparing a single weekly administration of hGH-CTP with daily injections of a currently marketed growth hormone product. The global and Japanese pediatric studies utilize the pen device and formulation that will be launched commercially upon approval. The pediatric segment represents more than 80% of the commercial market for treatment of hGH deficiency.
  • RAYALDEE line extension trial initiated in hemodialysis patients with SHPT: Together with its partners, Vifor Fresenius and Japan Tobacco, OPKO is developing RAYALDEE for patients with Stage 5 CKD who have secondary hyperparathyroidism (SHPT) and vitamin D insufficiency and are undergoing regular hemodialysis. A Phase 2 trial in this population is currently underway in the United States.
  • Topline data from the Phase 2b study with OPK88003, a once-weekly oxyntomodulin dual GLP1-Glucagon agonist for type 2 diabetes and obesity, is anticipated during 1Q 2019: The last patient, last visit of this Phase 2b dose-escalation study occurred in February 2019. In an earlier, 420-patient Phase 2 trial in patients with type 2 diabetes, OPK88003 was similar to exenatide extended-release (Ex ER) in reducing HbA1c levels. OPK88003 showed statistically significantly greater weight loss and lowering of total cholesterol and triglycerides compared to once-weekly Ex ER, with a good safety profile.
  • Appointed Jon R. Cohen, M.D. Executive Chairman and promoted Geoff Monk as President, both for BioReference Laboratories: Dr. Cohen brings more than 30 years of healthcare experience as a seasoned strategic leader with extensive and diverse experience; his track record of expanding existing business and developing new ventures, while dealing effectively with the payor universe, is well recognized in the diagnostics industry.
  • 4Kscore® utilization remained strong during 4Q 2018 with nearly 20,000 tests performed: The 4Kscore test is a blood test that gives a man with elevated prostate specific antigen (PSA) levels a personalized prediction of his chance of having or developing an aggressive form of prostate cancer. The Company is pursuing U.S. Food and Drug Administration (FDA) approval with a submission expected in the first half of 2019. OPKO announced on January 31, 2019 that Novitas Solutions, Inc. issued a notice of a future non-coverage determination for 4Kscore effective March 20, 2019. The Company is currently making efforts to have the determination rescinded or reversed.
  • FDA approved Claros® point-of-care (POC) PSA test: On February 1, 2019, OPKO announced that the FDA approved the Company’s point-of-care Sangia Total PSA Test using the Claros 1 Analyzer. The Company is taking steps to obtain CLIA waiver for the test and analyzer, which would permit the test to be performed by most medical office personnel with minimal training, and is also planning for scale up of manufacturing capacity during 2019. OPKO plans to expand the testing menu and the next test under development is testosterone, with clinical trials currently scheduled to commence in mid-2019.
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Very vague on the NBRXS for Rayaldee.
 


















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