Analyst Conference Summary


Protalix Biotherapeutics

conference date: March 14, 2019 @ 5:30 AM Pacific Time
for quarter ending: December 31, 2018 (Q4, fourth quarter 2018)

Forward-looking statements

Overview: Is in discussion with FDA for potential accelerated approval of PRX-102 for Fabry disease.

Basic data (GAAP):

Not given for Q4. For full year data, see below. Revenue was $ million, % sequentially from $0.7 million, and down % from $ million year-earlier.

Net income was negative $ million, down sequentially from negative $15.5 million, and down from $ million year-earlier.

EPS was negative $, down sequentially from negative $0.10, and down from $ year-earlier.



Conference Highlights:

Moshe Manor, Protalix's CEO, said "Throughout 2018 and into early 2019, we significantly advanced our clinical development program for PRX-102 and, as of today, have enrolled 127 Fabry disease patients across all of our PRX-102 clinical trials. Most recently, we had a very productive meeting with the FDA to discuss the potential filing of an application for accelerated approval and, at the FDA's request, we intend to hold a follow up meeting by the end of the second quarter of 2019 to discuss the data and content of the potential filing for accelerated approval. We are very pleased with the collaborative manner our engagement with the FDA has been to date and cautiously optimistic about the prospects of our discussions with the agency. We are very excited as we move forward into 2019 which could be a transformational year for us, including the read outs from our Fabry trials and the potential for establishing the path for accelerated approval for PRX-102 with the FDA."

Revenue for the first 9 months of the year was restated due to an accounting rule change.

Revenue is generated by taliglucerase alfa sales.

For PRX-102, Pegunigalsidase alfa, for Fabry disease, based on the FDA discussion during our recent meeting we believe that the potential filing for accelerated approval might be based on data the Company has already generated in its clinical trials of PRX-102. The Phase 3 BRIDGE study enrollment was completed in December 2018. As of today, the BALANCE trial is over 80% enrolled and the BRIGHT trial is over 90% enrolledIn October 2018, the Company presented positive preliminary data from its BRIDGE phase III clinical trial for the treatment of Fabry disease indicating a significant improvement in kidney function in patients switched from agalsidase alfa (Replagal) to PRX-102 at the 1st Canadian Symposium on Lysosomal Diseases. [See PRX-102 press release for details] U.S. rights were sold to Chiesi Farmaceutici S.p.A., which had already bought ex-U.S. rights. Will discuss regulatory path with FDA in 2019, but believes already has sufficient patients for expedited review.

For PRX-110, Alidornase alfa, for Cystic Fibrosis, for now the focus is on other programs, to conserve cash.

OPRX-106, an oral anti-TNF for ulcerative colitis Phase 2 top line results were positive. In discussions with portential partners.

An oral version of Humira is being worked on, no timeline for moving to clinical trials.

Cash balance ended at $37.8 million, down sequentially from $41.9 million. Debt is $52 million in convertible notes.

Believes has funding into 2020 using present cash only. R&D expense will be reduced as Chiesi assumes responsibility.

Q4 P&L not stated. Cost of revenue was $ million, leaving gross profit of negative $ million. R&D (net of grants) expense $ million. SG&A $ million. Leaving an operating loss of $ million. Financial expense $ million, financial income $ million.

Full year 2018 revenue was $34.3 million. Cost of goods sold $9.3 million. R&D $33.3 million. SG&A $10.9 million. Operating loss $19.3 million. Financial expense $7.7 million. Financial income $0.5 million. Net Loss $26.5 million. EPS negative $0.18 per share. Shares oustanding 147.1 million.

Q&A summary:

Revenue restatements? New accounting pronouncement. Chiesi licensing agreement revenue, which we were not recognizing, but new rule says we need to start recognizing it, $25 millon recognized out of about $70 million received.

You or Chiesi conducting next round of talks with FDA? Next meeting will go through the actual data that should go into the filing. If granted accelerated approval we will receive a significant milestone payment from Chiesi. The Balance study would act as our conservatory story for full approval.

PRX-110 discussion? Potential partners found the data interesting, but wanted a placebo-controlled data before moving into an agreement. If we receive significant cash we could start such a trial.

Plans for convertible securities? $0.85 strike price. Depends on developments and the stock price.

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Disclaimer: My analyst call summaries may include both condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. These are my personal notes which I share with other investors and which I use as the basis of my blog and Seeking Alpha articles.

Copyright 2019 William P. Meyers