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Halozyme (HALO) Down 9.2% on Weak 2023 Financial Guidance
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Shares of Halozyme Therapeutics (HALO - Free Report) were down 9.2% on Jan 11 after management issued its financial guidance and business outlook for the full year 2023.
Halozyme expects to record adjusted earnings per share in the range of $2.50 and $2.65 for the full year 2023. These figures fell short of both the Zacks Consensus Estimate and our model estimate of $3.00 and $2.83, respectively.
Management expects to record total revenues in the range of $815-$845 million in 2023. Though the revenue guidance indicates year-over-year growth of more than 20% over Halozyme’s revenues expected in 2022, it fell short of the Zacks Consensus Estimate and our model estimate of $889.47 and $866.30 million, respectively.
Halozyme expects royalty revenues in 2023 to increase by more than 20% over expected revenues in 2022 to a range of $445-$455 million. These figures also fell short of our model estimate of $461 million.
The company expects EBITDA for 2023 to be between $415 million and $440 million, indicating growth of more than 30% year over year.
Shares of Halozyme have risen 42.4% in the past year against the industry’s 14.1% fall.
Image Source: Zacks Investment Research
Halozyme’s ENHANZE drug delivery technology helps develop SC formulations of drugs. Several companies, including J&J (JNJ - Free Report) , Roche (RHHBY - Free Report) , argenx (ARGX - Free Report) , Lilly, Bristol-Myers and others, are using this technology for developing a subcutaneous formulation of their currently marketed drugs. The company expects to generate $1 billion in annual royalties from its ENHANZE technology by 2027.
Alongside its 2023 financial guidance, Halozyme also announced several key milestone events it expects to achieve during the year. It expects two new potential commercial launches this year by collaboration partners, including a subcutaneous (SC) version of argenx’s Vyvgart (efgartigimod) and a SC formulation of Roche’s PD-L1 inhibitor Tecentriq (atezolizumab). Halozyme also expects data readouts from four late-stage studies evaluating products utilizing its ENHANZE technology later this year.
Last September, Halozyme’s partner, argenx announced the submission of a biologics license application (BLA) to the FDA for the SC formulation of efgartigimod in generalized myasthenia gravis indication. A decision from the regulator on argenx’s BLA is expected by March 20, 2022. A potential approval will likely boost Halozyme revenues through additional royalties.
Darzalex SC/Darzalex Faspro is a SC formulation of J&J’s popular intravenous (IV) cancer drug, Darzalex, developed using the ENHANZE technology for easier administration compared to IV. Demand for this J&J drug is likely to remain robust for the next few quarters and drive the momentum in Halozyme’s shares.
Halozyme has five marketed partnered drugs developed using its ENHANZE technology. Apart from J&J’s Darzalex SC/Darzalex Faspro, other key partnered drugs of Halozyme include the SC formulation of three drugs from Roche’s portfolio — Herceptin, Phesgo and Rituxan. Another commercialized partnered drug includes Hyqvia, which is approved for treating immunodeficiency and marketed by Baxalta, a subsidiary of Takeda.
Apart from Tecentriq, Roche is also developing a SC formulation of its popular multiple sclerosis drug Ocrevus (ocrelizumab) using the ENHANZE technology.
Image: Bigstock
Halozyme (HALO) Down 9.2% on Weak 2023 Financial Guidance
Shares of Halozyme Therapeutics (HALO - Free Report) were down 9.2% on Jan 11 after management issued its financial guidance and business outlook for the full year 2023.
Halozyme expects to record adjusted earnings per share in the range of $2.50 and $2.65 for the full year 2023. These figures fell short of both the Zacks Consensus Estimate and our model estimate of $3.00 and $2.83, respectively.
Management expects to record total revenues in the range of $815-$845 million in 2023. Though the revenue guidance indicates year-over-year growth of more than 20% over Halozyme’s revenues expected in 2022, it fell short of the Zacks Consensus Estimate and our model estimate of $889.47 and $866.30 million, respectively.
Halozyme expects royalty revenues in 2023 to increase by more than 20% over expected revenues in 2022 to a range of $445-$455 million. These figures also fell short of our model estimate of $461 million.
The company expects EBITDA for 2023 to be between $415 million and $440 million, indicating growth of more than 30% year over year.
Shares of Halozyme have risen 42.4% in the past year against the industry’s 14.1% fall.
Image Source: Zacks Investment Research
Halozyme’s ENHANZE drug delivery technology helps develop SC formulations of drugs. Several companies, including J&J (JNJ - Free Report) , Roche (RHHBY - Free Report) , argenx (ARGX - Free Report) , Lilly, Bristol-Myers and others, are using this technology for developing a subcutaneous formulation of their currently marketed drugs. The company expects to generate $1 billion in annual royalties from its ENHANZE technology by 2027.
Alongside its 2023 financial guidance, Halozyme also announced several key milestone events it expects to achieve during the year. It expects two new potential commercial launches this year by collaboration partners, including a subcutaneous (SC) version of argenx’s Vyvgart (efgartigimod) and a SC formulation of Roche’s PD-L1 inhibitor Tecentriq (atezolizumab). Halozyme also expects data readouts from four late-stage studies evaluating products utilizing its ENHANZE technology later this year.
Last September, Halozyme’s partner, argenx announced the submission of a biologics license application (BLA) to the FDA for the SC formulation of efgartigimod in generalized myasthenia gravis indication. A decision from the regulator on argenx’s BLA is expected by March 20, 2022. A potential approval will likely boost Halozyme revenues through additional royalties.
Darzalex SC/Darzalex Faspro is a SC formulation of J&J’s popular intravenous (IV) cancer drug, Darzalex, developed using the ENHANZE technology for easier administration compared to IV. Demand for this J&J drug is likely to remain robust for the next few quarters and drive the momentum in Halozyme’s shares.
Halozyme has five marketed partnered drugs developed using its ENHANZE technology. Apart from J&J’s Darzalex SC/Darzalex Faspro, other key partnered drugs of Halozyme include the SC formulation of three drugs from Roche’s portfolio — Herceptin, Phesgo and Rituxan. Another commercialized partnered drug includes Hyqvia, which is approved for treating immunodeficiency and marketed by Baxalta, a subsidiary of Takeda.
Apart from Tecentriq, Roche is also developing a SC formulation of its popular multiple sclerosis drug Ocrevus (ocrelizumab) using the ENHANZE technology.
Halozyme Therapeutics, Inc. Price
Halozyme Therapeutics, Inc. price | Halozyme Therapeutics, Inc. Quote
Zacks Rank
Halozyme currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.