NVCR - Novocure Reports Second Quarter 2024 Financial Results

July, 25 2024 07:00 AM NovoCure Limited

Quarterly net revenues of $150 million, up 19% year-over-year, with 3,963 active patients on therapy as of June 30, 2024

Positive results from Phase 3 METIS trial in brain metastases from non-small cell lung cancer presented at ASCO 2024

Novocure (NASDAQ: NVCR) today reported financial results for the quarter ended June 30, 2024. Novocure is a global oncology company working to extend survival in some of the most aggressive forms of cancer by developing and commercializing its innovative therapy, Tumor Treating Fields (TTFields).

“The second quarter was a period of consistent execution at Novocure,” said Asaf Danziger, Novocure’s Chief Executive Officer. “We began the year with three key objectives – grow our commercial business in glioblastoma, launch our next indication in non-small cell lung cancer, and deliver on the promise of our clinical and product development pipelines. I am pleased to share we have made significant progress on all fronts this quarter.”

Financial updates for the second quarter ended June 30, 2024:

Total net revenues for the quarter were $150.4 million, an increase of 19% compared to the same period in 2023. This increase is primarily driven by our successful launch in France and improved U.S. approval rates.
- The United States, Germany, France and Japan contributed $95.7 million, $15.1 million, $14.3 million and $7.7 million, respectively, with other active markets contributing $11.8 million.
- Revenue in Greater China from Novocure’s partnership with Zai Lab totaled $5.8 million.
- Improved approval rates in the U.S. resulted in $5.0 million of increased net revenue from prior period claims during the quarter. In addition, we received $2.6 million in net revenues from a private payer in the United Kingdom where payments are not routine. We do not expect these two benefits, totaling $7.6 million, to recur.
Gross margin for the quarter was 77%.
Research, development and clinical studies expenses for the quarter were $55.0 million, a decrease of 1% from the same period in 2023.
Sales and marketing expenses for the quarter were $56.6 million, a decrease of 3% compared to the same period in 2023. This primarily reflects lower personnel expenses associated with support functions.
General and administrative expenses for the quarter were $37.7 million, a decrease of 8% compared to the same period in 2023. This primarily reflects lower personnel expenses.
Net loss for the quarter was $33.4 million with loss per share of $0.31.
Adjusted EBITDA* for the quarter was $1.1 million.
Cash, cash equivalents and short-term investments were $951.2 million as of June 30, 2024.

Operational updates for the second quarter ended June 30, 2024:

1,634 prescriptions were received in the quarter, an increase of 5% compared to the same period in 2023. Prescriptions from the United States, Germany, France and Japan contributed 957, 206, 176 and 108 prescriptions, respectively, with the remaining 187 prescriptions received in other active markets.
As of June 30, 2024, there were 3,963 active patients on therapy, an increase of 11% compared to the same period in 2023. Active patients from the United States, Germany, France and Japan contributed 2,175, 538, 369 and 403 active patients, respectively, with the remaining 478 active patients contributed by other active markets.

Quarterly updates and achievements:

In June, we presented positive results from the phase 3 METIS trial, evaluating the use of TTFields therapy and supportive care for the treatment of patients with brain metastases from non-small cell lung cancer (NSCLC) following stereotactic radiosurgery at the 2024 American Society of Clinical Oncology (ASCO) annual meeting. The METIS trial met its primary endpoint, demonstrating a statistically significant improvement in time to intracranial progression for adult patients treated with TTFields therapy and supportive care compared to patients treated with supportive care alone.
In June, we presented top-line results from the prospective, non-interventional TIGER study at the 2024 ASCO annual meeting. TIGER investigated the use of TTFields therapy in routine clinical use in the treatment of newly diagnosed GBM in Germany. The outcomes observed in the TIGER study are consistent with the survival and safety results from our phase 3 EF-14 clinical trial. TTFields therapy use was not associated with an increase in systemic toxicity and was well tolerated.

Anticipated clinical milestones:

Top-line data from phase 3 PANOVA-3 clinical trial in locally advanced pancreatic cancer (Q4 2024)

Conference call details

Novocure will host a conference call and webcast to discuss second quarter 2024 financial results at 8:00 a.m. EDT today, Thursday, July 25, 2024. To access the conference call by phone, use the following conference call registration link and dial-in details will be provided. To access the webcast, use the following webcast registration link .

The webcast, earnings slides presented during the webcast and the corporate presentation can be accessed live from the Investor Relations page of Novocure’s website, www.novocure.com/investor-relations , and will be available for at least 14 days following the call. Novocure has used, and intends to continue to use, its investor relations website, as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.

About Novocure

Novocure is a global oncology company working to extend survival in some of the most aggressive forms of cancer through the development and commercialization of its innovative therapy, Tumor Treating Fields. Novocure’s commercialized products are approved in certain countries for the treatment of adult patients with glioblastoma, malignant pleural mesothelioma and pleural mesothelioma. Novocure has ongoing or completed clinical trials investigating Tumor Treating Fields in brain metastases, gastric cancer, glioblastoma, liver cancer, non-small cell lung cancer, pancreatic cancer and ovarian cancer.

Headquartered in Root, Switzerland and with a growing global footprint, Novocure has regional operating centers in Portsmouth, New Hampshire and Tokyo, as well as a research center in Haifa, Israel. For additional information about the company, please visit Novocure.com and follow @Novocure on LinkedIn and Twitter.

*Non-GAAP Financial Measurements

We measure our performance based upon a non-U.S. GAAP measurement of earnings before interest, taxes, depreciation, amortization and shared-based compensation ("Adjusted EBITDA"). We believe Adjusted EBITDA is useful to investors in evaluating our operating performance because it helps investors compare the results of our operations from period to period by removing the impact of earnings attributable to our capital structure, tax rate and material non-cash items, specifically share-based compensation.

Forward-Looking Statements

In addition to historical facts or statements of current condition, this press release may contain forward-looking statements. Forward-looking statements provide Novocure’s current expectations or forecasts of future events. These may include statements regarding anticipated scientific progress on its research programs, clinical trial progress, development of potential products, interpretation of clinical results, prospects for regulatory approval, manufacturing development and capabilities, market prospects for its products, coverage, collections from third-party payers and other statements regarding matters that are not historical facts. You may identify some of these forward-looking statements by the use of words in the statements such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe” or other words and terms of similar meaning. Novocure’s performance and financial results could differ materially from those reflected in these forward-looking statements due to general financial, economic, environmental, regulatory and political conditions and other more specific risks and uncertainties facing Novocure such as those set forth in its Annual Report on Form 10-K filed on February 22, 2024, and subsequent filings with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, any or all of these forward-looking statements may prove to be incorrect. Therefore, you should not rely on any such factors or forward-looking statements. Furthermore, Novocure does not intend to update publicly any forward-looking statement, except as required by law. Any forward-looking statements herein speak only as of the date hereof. The Private Securities Litigation Reform Act of 1995 permits this discussion.

NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)

Three months ended June 30,

Six months ended June 30,

Year ended December 31,

2024

2023

2024

2023

2023

Unaudited

Unaudited

Audited
Net revenues
$
150,356


$
126,051


$
288,859


$
248,233


$
509,338

Cost of revenues

34,654



34,018



68,343



63,632



128,280

Gross profit

115,702



92,033



220,516



184,601



381,058











Operating costs and expenses:









Research, development and clinical studies

54,955



55,427



106,553



115,131



223,062

Sales and marketing

56,616



58,488



111,822



109,657



226,809

General and administrative

37,711



40,778



77,241



82,722



164,057

Total operating costs and expenses

149,282



154,693



295,616



307,510



613,928











Operating income (loss)

(33,580
)


(62,660
)


(75,100
)


(122,909
)


(232,870
)
Financial income (expenses), net

10,851



8,756



20,729



17,925



41,130











Income (loss) before income tax

(22,729
)


(53,904
)


(54,371
)


(104,984
)


(191,740
)
Income tax

10,646



3,514



17,764



5,495



15,303

Net income (loss)
$
(33,375
)

$
(57,418
)

$
(72,135
)

$
(110,479
)

$
(207,043
)










Basic and diluted net income (loss) per ordinary share
$
(0.31
)

$
(0.54
)

$
(0.67
)

$
(1.04
)

$
(1.95
)
Weighted average number of ordinary shares used in computing basic and diluted net income (loss) per share

107,700,284



106,289,073



107,483,241



105,979,791



106,391,178

Consolidated Balance Sheets
USD in thousands (except share data)

NOVOCURE LIMITED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands (except share data)

June 30, 2024

December 31, 2023

Unaudited

Audited
ASSETS



CURRENT ASSETS:



Cash and cash equivalents
$
164,796

$
240,821
Short-term investments

786,390


669,795
Restricted cash

3,647


1,743
Trade receivables, net

64,703


61,221
Receivables and prepaid expenses

32,858


22,677
Inventories

40,442


38,152
Total current assets

1,092,836


1,034,409
LONG-TERM ASSETS:



Property and equipment, net

66,477


51,479
Field equipment, net

11,719


11,384
Right-of-use assets

29,076


34,835
Other long-term assets

12,062


14,022
Total long-term assets

119,334


111,720
TOTAL ASSETS
$
1,212,170

$
1,146,129

Consolidated Balance Sheets
USD in thousands (except share data)





June 30, 2024

December 31, 2023

Unaudited

Audited
The accompanying notes are an integral part of these unaudited consolidated financial statements.
LIABILITIES AND SHAREHOLDERS' EQUITY



CURRENT LIABILITIES:



Trade payables
$
90,171


$
94,391

Other payables, lease liabilities and accrued expenses

79,007



84,724

Total current liabilities

169,178



179,115

LONG-TERM LIABILITIES:



Convertible note

556,508



568,822

Senior secured credit facility, net

96,962



—

Long-term leases

21,731



27,420

Employee benefit liabilities

6,023



8,258

Other long-term liabilities

18



18

Total long-term liabilities

681,242



604,518

TOTAL LIABILITIES

850,420



783,633

COMMITMENTS AND CONTINGENCIES







SHAREHOLDERS' EQUITY:



Share capital -



Ordinary shares no par value, unlimited shares authorized; issued and outstanding: 108,013,830 shares and 107,075,754 shares at June 30, 2024 (unaudited) and December 31, 2023, respectively

—



—

Additional paid-in capital

1,422,903



1,353,468

Accumulated other comprehensive income (loss)

(3,515
)


(5,469
)
Retained earnings (accumulated deficit)

(1,057,638
)


(985,503
)
TOTAL SHAREHOLDERS' EQUITY

361,750



362,496

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
1,212,170


$
1,146,129

Non-U.S. GAAP financial measures reconciliation
USD in thousands





Three months ended June 30,

Six months ended June 30,

2024

2023

% Change

2024

2023

% Change
Net income (loss)
$
(33,375
)

$
(57,418
)

(42
)%

$
(72,135
)

$
(110,479
)

(35
)%
Add: Income tax

10,646



3,514


203
%


17,764



5,495


223
%
Add: Financial expenses (income), net

(10,851
)


(8,756
)

24
%


(20,729
)


(17,925
)

16
%
Add: Depreciation and amortization

2,858



2,721


5
%


5,673



5,443


4
%
EBITDA
$
(30,722
)

$
(59,939
)

(49
)%

$
(69,427
)

$
(117,466
)

(41
)%
Add: Share-based compensation

31,830



32,740


(3
)%


65,914



71,824


(8
)%
Adjusted EBITDA
$
1,108


$
(27,199
)

(104
)%

$
(3,513
)

$
(45,642
)

(92
)%

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Investors & Media:
Ingrid Goldberg
investorinfo@novocure.com
media@novocure.com

Company Name:	NovoCure Limited
Stock Symbol:	NVCR
Market:	NASDAQ
Website:	novocure.com