Analyst Conference Summary


Protalix Biotherapeutics

conference date: August 16, 2021 @ 5:30 AM Pacific Time
for quarter ending: June 30, 2021 (Q2, second quarter 2021)

Forward-looking statements

Overview: Working on the CLR (complete response letter) for PRX-102.

Basic data (GAAP):

Revenue was $6.4 million, down sequentially from $11.3 million, and down from $11.0 million year-earlier.

Net income was negative $11.2 million, down sequentially from negative $5.5 million, and down from negative $4.2 million year-earlier.

EPS was negative $0.25, down sequentially from negative $0.14, and down from negative $0.13 year-earlier. Also, diluted share count jumped to 45.4 million from 32.4 million y/y.


Believes cash runway through 2022.

Conference Highlights:

Dror Bashan, Protalix's CEO, said "We continue to work closely with the FDA to address the issues raised in the Complete Response Letter received in April for PRX-102 for the proposed treatment of adult patients with Fabry disease. We look forward to the meeting with the FDA, which has been scheduled for September 9, 2021. In addition, we strengthened our balance sheet by entering into definitive agreements with a majority of our institutional note holders relating to exchanges by such note holders of a total of $54.65 million principal amount of our outstanding 7.50% Senior Secured Convertible Notes due 2021 for an aggregate of $28.75 million principal amount of newly issued 7.50% Senior Secured Convertible Notes due 2024, $25.90 million in cash and accrued and unpaid interest through the closing date. We plan to close the exchanges as soon as practicable. This transaction will allow us the use of our cash resources to continue to realize the PRX-102 potential and advance our early-stage pipeline. We are grateful for the continued support from our team members and external partners and look forward to a productive finish to 2021."

Received a Complete Response Letter on the PDUFA date, April 28, 2021. On August 2, 2021 requested a Type A meeting with the FDA to discuss this. The FDA Type A meeting is now scheduled for September 9, 2021. Protalix and Chiesi had submitted the BLA for PRX-102, Pegunigalsidase alfa, for Fabry disease, on May 27, 2020 via the FDA's Accelerated Approval pathway based on data from the completed Phase I/II clinical trials of PRX-102 and the ongoing Phase III BRIDGE clinical trial. Now must resubmit, could be delayed further due to the FDA need to inspect facilities in Europe and Israel. The Phase 3 BALANCE and the BRIGHT trial have completed enrollment. Initial top-line 12 month Phase 3 results from the ongoing Balance trial were released on June 2, 2021. Based on the two trials, the companies plan an EU filing. Full 24 month Balance data is expected in Q2 2022.

Because of the CLR Protalix decided to raise funds by entering, in May 2021, a new agreement with Chiesi. Protalix recieved a $10 million milestone payment in exchange for a $25 million reduction in a later potential milestone. Also On July 2, 2021, entered into an ATM Sales Agreement with H.C. Wainwrigh to sell, shares of its common stock up to an aggregate offering price of $20.0 million. Protalix terminated the ATM Equity Offering Sales Agreement it had previously entered into with BofA Securities, Inc.

On February 23, 2021, Chiesi and Protaliz, announced positive topline results from the phase III BRIGHT clinical trial, of PRX-102, 2 mg/kg every four weeks, in up to 30 patients with Fabry disease previously treated with agalsidase alfa (Replagal) or agalsidase beta (Fabrazyme). Topline results indicate that PRX-102 administered by intravenous infusion every four weeks was found to be well tolerated among treated patients, and stable clinical presentation was maintained in adult Fabry patients.

On December 30, 2020, Protalix and Chiesi announced final study results from the phase III BRIDGE clinical trial, a 12-month open-label, single arm switch-over study evaluating the safety and efficacy of PRX-102, 1 mg/kg infused every two weeks, in up to 22 Fabry patients. It showed substantial improvement in renal function as measured by mean annualized estimated Glomerular Filtration Rate (eGFR slope) in both male and female patients who were switched.

On August 12, 2021, Protalix entered into agreements to exchanges of an aggregate of $54.65 million of the outstanding 7.50% Senior Secured Convertible Notes due 2021 for an aggregate of $28.75 million principal amount of newly issued 7.50% Senior Secured Convertible Notes due 2024, $25.90 million in cash and accrued and unpaid interest through the closing date. The exchanges are expected to close as soon as practicable. At closing will have reduced debt by $28.75 million and effectively extended the maturity for substantially all of the remaining debt from 2021 until 2024.

On February 10, 2021, Protalix entered into an exclusive partnership with SarcoMed USA for the worldwide development and commercialization of alidornase alfa (PRX-110), for use in the treatment of any human respiratory disease including, sarcoidosis, pulmonary fibrosis and other related diseases via inhaled delivery.

Expanded access program for PRX-102 was launched in October 2020.

Has other potential therapies in preclinical development. PRX115 and PRX119 could enter clinical trials in 2022.

Revenue generated by taliglucerase alfa sales was $3.2 million, down sequentially from $4.5 million, and down from $3.6 million year-earlier. $3.2 million of revenue was from licensing and R&D services.

Cash and equivalents balance ended at $77 million, up sequentially from $70 million. Debt is $56 million in convertible notes.

Cost of goods sold was 4.7 million. R&D (net of grants) expense $7.7 million. SG&A $3.2 million. Leaving an operating loss of $9.2 million. Financial expense $2.1 million.

Q&A summary:

Type A expectations, agenda? Will discuss CLA, no details.

Manufacturing site inspections? We will have to wait for the meeting.

PRX115 timeline? Tox studies in 2022, then clinical.

PRX119? More preclinical, then tox, then clinical.

Expenses, will they require spends again after approval? They were one time for BLA approval, manufacturing plans. Admin costs for the submission, plus process improvements.

Pediatric PRX102? The rival approval is probably favorable to our getting an apporval.

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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 Seeking Alpha articles.

Copyright 2021 William P. Meyers