NVS - GenScript Losses Shrink On Strong Growth For Cancer Cell Therapy | Benzinga
Key Takeaways:
- GenScript’s cell therapy revenue grew by 143.7% last year as a CAR-T cell therapy developed by its Legend Biotech subsidiary gained traction
- Legend’s Carvykti is expected to hit annual production capacity of 10,000 doses by the end of 2025
By Li Shih Ta
In the rapidly evolving world of cancer treatments, CAR-T cell therapy stands out for its effectiveness tackling hematologic tumors. Booming demand for such therapies powered Legend Biotech Corp. (NASDAQ: LEGN), and in turn its parent, GenScript Biotech Corp. (1548.HK), to a banner year in 2023 on accelerating sales for Legend’s Carvykti CAR-T cell therapy.
GenScript’s revenue grew 34.2% last year to $840 million, lifting its five-year compound annual growth rate to 30%. Its loss of $95.5 million was down by more than half from a $230 million loss in 2022, according to its latest annual results released last week. Its stock rose more than 7.9% after the announcement, as investors cheered the revenue growth and narrowing losses.
GenScript specializes in gene synthesis and new drug development, with focus on four areas: life science services and products (CRO); biologics development under its GenScript ProBio (CDMO) subsidiary; industrially synthesized biologics development under its Bestzyme Biotech unit; and cell therapy under Legend Biotech.
The life sciences business has traditionally been GenScript’s main profit engine, bringing in $420 million in revenue and $78.3 million in operating profit last year, up 14.5% and 19.4% from 2022, respectively. By comparison, the cell therapy business has been a money-loser, including its $390 million loss last year. While that latest loss narrowed from 2022 levels, the business remains the most capital-intensive for GenScript due to heavy R&D spending.
Of GenScript’s $430 million in R&D spending last year, which was up about 11% from 2022, the cell therapy business accounted for $380 million, or nearly 90% of the total.
Cell therapy rising star
Despite its heavy costs, GenScript’s cell therapy division has also been one of its most promising businesses, reflected by rapid growth for Carvykti in the U.S. ...