Incyte Corporation reported 2016 first-quarter financial results. Net product revenues of Jakafi were $183 million as compared to $115 million for the same period in 2015, representing 59% growth.
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For the quarter ended March 31, 2016, product royalties from sales of Jakavi outside of the United States received from Novartis were $22 million as compared to $16 million for the same period in 2015.
For the quarter ended March 31, 2016, contract revenues were $58 million as compared to $28 million for the same period in 2015.
Incyte Corporation earned $55 million in milestone payments from Lilly during the quarter ended March 31, 2016 and a $25 million milestone payment from Novartis during the quarter ended March 31, 2015.
For the quarter ended March 31, 2016, total revenues were $263 million as compared to $159 million for the same period in 2015.
Research and development expenses for the quarter ended March 31, 2016 were $157 million as compared to $118 million for the same period in 2015.
Included in research and development expenses for the quarter ended March 31, 2016 is the previously announced $35 million upfront payment to acquire the rights from Lilly to develop ruxolitinib for the treatment of patients with GVHD and non-cash expenses related to equity awards to our employees of $13 million.
In addition to the $35 million upfront payment to Lilly, the increase in research and development expenses was primarily due to the expansion of the Company’s clinical portfolio.
Selling, general and administrative expenses for the quarter ended March 31, 2016 were $65 million as compared to $45 million for the same period in 2015.
Included in selling, general and administrative expenses for the quarter ended March 31, 2016 were non-cash expenses related to equity awards to our employees of $8 million.
Increased selling, general and administrative expenses are driven primarily by additional costs related to the commercialization of Jakafi.
Unrealized loss on long term investment of $3 million for the quarter ended March 31, 2016 represents the fair market value adjustments of the Company’s investment in Agenus.
Net income for the quarter ended March 31, 2016 was $24 million, or $0.13 per basic and $0.12 per diluted share, as compared to net loss of $18 million, or $0.11 per basic and diluted share for the same period in 2015.
As of March 31, 2016, cash, cash equivalents and marketable securities totaled $811 million, as compared to $708 million as of December 31, 2015.
Incyte Corporation and Ariad Pharmaceuticals announced the entry into a definitive agreement for Incyte to acquire Ariad’s European operations.
At the close of the transaction, the companies will also enter into a license agreement whereby Incyte will obtain an exclusive license to develop and commercialize Iclusig (ponatinib) in Europe and other select countries.
The planned acquisition of a fully-integrated and established pan-European team of 125 employees, including medical, sales and marketing personnel, will further Incyte’s strategic plan and accelerate the establishment of its operations in Europe, helping to optimize clinical development and maximize the potential of future European launches for Incyte’s portfolio of products in development.
The agreement to divest its European operations and out-license Iclusig in Europe will enable Ariad to focus its promotion of Iclusig on the highly valuable U.S. market, while strengthening its financial position and maintaining important optionality through a potential buy-back provision for the Iclusig license rights in the event of a change-in-control of Ariad.
Under the terms of the license agreement, Incyte will receive an exclusive license to develop and commercialize Iclusig, the only approved BCR-ABL inhibitor with activity against the T315I mutation, throughout Europe and in other select countries.
Iclusig is approved in Europe for the treatment of patients with chronic myeloid leukemia (CML) and Philadelphia-positive (Ph+) acute lymphoblastic leukemia (ALL) who are resistant to or intolerant of certain second generation BCR-ABL inhibitors and all patients who have the T315I mutation. ■