Protalix Biotherapeutics Inc (PLX) Announces 3Q:17 Results and Provides Corporate Update


Protalix Biotherapeutics Inc (NYSEAMERICAN:PLX) announced its financial results for the nine months ended September 30, 2017 and provided a corporate update.

“I am excited about the progress we made recently,” said Moshe Manor, Protalix’s President and Chief Executive Officer.  “We are no longer facing any debt issue or financing overhang.  Moreover, with the recent strategic collaboration with Chiesi, not only did we secure a strong, experienced clinical and commercial partner, but we also meaningfully increased our capital resources, providing us with sufficient cash into 2020, irrespective of any milestone payments we are entitled to from Chiesi, increased revenues or from future partnerships.  In addition, on the strategic front, we now have three novel and clinically differentiated product candidates in the clinic with potentially superior efficacy which provides us multiple shots at goal to realize significant value for our stockholders.”

Third Quarter and Recent Clinical Highlights

Pegunigalsidase alfa (PRX-102) for Fabry Disease

  • Protalix entered into an EX-US collaboration agreement with Chiesi Farmaceutici S.p.A., or Chiesi, for pegunigalsidase alfa, or PRX-102.  Under the terms of the agreement, Protalix is entitled to an upfront payment of $25 million from Chiesi, up to $25 million to cover development costs for pegunigalsidase alfa, subject to a maximum of $10 million per year, and up to an additional $320 million in regulatory and commercial milestone payments.  Additionally, Protalix is entitled to tiered payments of 15% to 35% of Chiesi’s net sales.
  • Patient enrollment in the Company’s phase III clinical trials, referred to as the Balance, Bridge and Bright studies, is on-going.

Alidornase alfa (PRX-110) for Cystic Fibrosis

  • Protalix applied for a financial grant from the Cystic Fibrosis Foundation to support the clinical development of alidornase alfa.
  • A poster titled “Development of Novel Actin Inhibition Resistant DNase I Enzyme – alidornase alfa – for the Treatment of Cystic Fibrosis” was presented at the North American Cystic Fibrosis Conference held in November 2017.

Oral antiTNF (OPRX-106) for Ulcerative Colitis

  • The final patients needed to complete enrollment in the Company’s phase II clinical trial of OPRX-106 for the treatment of ulcerative colitis are in the screening process.  The Company remains on track to complete enrollment during the fourth quarter and report top-line results in early 2018.

Alfataliglicerase for Gaucher Disease

  • Shipment of approximately $3.0 million of alfataliglicerase was completed this quarter for a total of $6.6 million for the nine months ended September 30, 2017.
  • According to the purchase order received by the Company, additional shipments are scheduled to be made during fourth quarter of 2017, and into 2018.

Financial Results for Nine Months ended September 30, 2017

  • The Company reported a net loss of $32.1 million, or $0.25 per share, basic and diluted, for the nine-month period ended September 30, 2017, excluding a one-time, non-cash net charge of $38.1 million in connection with the remeasurement of a derivative, compared to a net loss of $26.7 million, or $0.27 per share, basic and diluted, for the same period of 2016.
  • The Company recorded total revenues of $16.8 million for the nine-month period ended September 30, 2017, compared to $7.1 million during the same period of 2016.  The increase is primarily the result of increased sales of drug product to Brazil of $6.6 million in the nine months ended September 30, 2017, compared to $2.7 million in the same period of 2016, and the sale of drug substance to Pfizer Inc.
  • Research and development expenses, net were $19.8 million for the nine-month period ended September 30, 2017, compared to $18.9 million for the same period of 2016.  Selling, general and administrative expenses were $8.2 million for the nine-month period ended September 30, 2017, compared to $6.2 million incurred during the same period of 2016.  The increases are primarily attributed to increased activities in three ongoing clinical trials and selling in Brazil.
  • During the nine-month period ended September 30, 2017 and during October, note holders converted the entire $8.55 million in aggregate principal amount of the Company’s 4.50% convertible notes due 2022.
  • As of today, the Company’s outstanding convertible notes include 4.50% convertible notes due September 2018 with an aggregate principal amount of $5.9 million and senior secured 7.50% convertible notes due November 2021 with an aggregate principal amount of $61.9 million.
  • On September 30, 2017, the Company had $33.4 million of cash and cash equivalents.  With the Company’s current cash, plus the additional $25 million upfront payment due from Chiesi, and without giving effect to any milestone payment we are entitled to from Chiesi, anticipated increase in revenue run rate or any additional potential partnerships, the Company has sufficient resources to fund operations into 2020.

Shares of Protalix Biotherapeutics closed yesterday at $0.73, down $0.03 or -3.44%. PLX has a 1-year high of $1.51 and a 1-year low of $0.26. The stock’s 50-day moving average is $0.66 and its 200-day moving average is $0.73.

On the ratings front, H.C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on PLX, with a price target of $5, in a report issued on August 10. The current price target implies an upside of 585% from current levels. According to TipRanks.com, Selvaraju has a yearly average loss of 11.4%, a 32% success rate, and is ranked #4647 out of 4707 analysts.

Protalix engages in the development and commercialization of recombinant therapeutic proteins based on ProCellEx plant cell based expression system. It offers Taliglucerase alfa injections under the brand name Elelyso, an enzyme replacement therapy for Gaucher disease. The company’s drug also include Oral Glucocerebrosidase for potential treatment of Gaucher disease; therapeutic proteins for Fabry disease, and immune diseases such as rheumatoid, psoriatic and juvenile idiopathic arthritis, ankylosing, spondylitis, and plaque psoriasis; and protein for biodefense and other indications.