Dynavax Technologies Corporation (Nasdaq: DVAX), a biopharmaceutical company focused on developing and commercializing novel vaccines, today reported financial results for the first quarter of 2021.
"The first quarter of 2021 continued to build on our successful execution in 2020. With the combined strength of opportunities from HEPLISAV-B and CpG 1018, we believe 2021 will be a transformational year for Dynavax," commented Ryan Spencer, Chief Executive Officer of Dynavax. "HEPLISAV-B continues to take market share in accounts targeted by our field sales team, reaching a new high this quarter, which reinforces our belief that it will become the standard of care in the U.S. for adult hepatitis B vaccination."
Mr. Spencer continued, "Dynavax is making progress on numerous collaborations for its proven vaccine adjuvant CpG 1018 across multiple indications, including COVID-19, pertussis, and universal flu. Our COVID-19 collaborations have advanced significantly in recent months with multiple partners targeting emergency or conditional authorization in the second half of 2021. Importantly, these collaborations are now generating significant revenue for Dynavax, with first quarter CpG 1018 revenue of $74.6 million. Additionally, last week we expanded our agreement with CEPI whereby they fund manufacturing of CpG 1018 for future sales to CEPI grantees, providing the opportunity for additional revenue in 2021 from COVID-19 collaborations. The emerging portfolio of product opportunities with CpG 1018 has the potential to drive significant revenue growth beyond this year."
HEPLISAV-B [Hepatitis B Vaccine (Recombinant), Adjuvanted]
Net product revenue for HEPLISAV-B during the first quarter 2021 was $8.3 million compared to $10.5 million for the first quarter 2020, driven by increased market share offset by a reduction in vaccine utilization due to the COVID-19 pandemic.
Market share in accounts targeted by the field sales team increased to 27%, up from 21% market share in the first quarter of 2020.
Final immunogenicity and interim safety results of the ongoing clinical trial (HBV-24) evaluating HEPLISAV-B in patients undergoing hemodialysis evaluating a new 4-dose regimen of HEPLISAV-B demonstrated a seroprotection rate of 89.3%. Interim safety data showed HEPLISAV-B is well tolerated and no safety concerns were observed. Full safety data are expected by the end of 2021.
Positive results from the post-marketing observational surveillance study (HBV-25) in over 69,000 patients demonstrated the study met the primary endpoint and showed no evidence of an increased risk of acute myocardial infarction associated with vaccination with HEPLISAV-B compared to Engerix-B.
CpG 1018 (Advanced Vaccine Adjuvant)
Net product revenue for CpG 1018 during the first quarter 2021 was $74.6 million.
In February, Dynavax initiated a Phase 1 clinical trial of Tdap-1018, its tetanus, diphtheria, and acellular pertussis (Tdap) booster vaccine product candidate adjuvanted with CpG 1018.
In March, Clover Biopharmaceuticals dosed the first participant in SPECTRA, a global Phase 2/3 clinical trial for its trimeric SARS-CoV 2 spike (S) protein vaccine adjuvanted with CpG 1018.
In April, Valneva reported positive initial results for Part A of the Phase 1/2 clinical trial of its VLA2001 COVID-19 vaccine candidate adjuvanted with CpG 1018 and subsequently initiated a pivotal Phase 3 clinical trial.
In April, Medigen published positive Phase 1 clinical study data demonstrating neutralizing antibody titers 1.8 to 3.9 times that of human convalescent sera for its COVID-19 vaccine candidate adjuvanted with CpG 1018 and has completed enrollment of over 4,000 participants in its on-going Phase 2 clinical trial.
In April, CEPI expanded its agreement with the Company to provide funding to manufacture CpG 1018 for its COVID-19 vaccine grantees, increasing total funding under the loan agreement from $99 million to $176 million.
Multiple data readouts from our CpG 1018 COVID-19 collaboration partners throughout the year
Data from the ongoing Phase 1 clinical trial of Tdap-1018 in the fourth quarter
Launch HEPLISAV-B in the EU in the fourth quarter
Total Revenue. Total revenues for the first quarter of 2021 were $83.3 million, including $82.9 million of net product revenue, an increase from total revenue for the first quarter of 2020 of $10.9 million.
Product Revenue, Net. HEPLISAV-B product revenue, net was $8.3 million in the first quarter of 2021 compared to $10.5 million in the same period in 2020. CpG 1018 product revenue, net was $74.6 million in the first quarter of 2021 compared to $0.0 million in the same period in 2020.
Cost of Sales - Product. Cost of sales - product for the first quarter 2021 increased to $24.6 million, compared to $2.4 million for the first quarter of 2020. The increase was primarily due to manufacturing costs for CpG 1018.
Research and Development Expenses (R&D). R&D expenses for the first quarter of 2021 increased to $7.8 million, compared to $4.7 million for the first quarter of 2020. The increase is primarily due to development activities related to process improvements at our Dusseldorf facility and higher headcount, partially offset by a decrease in business travel due to COVID-19 travel restrictions. In addition, non-cash stock-based compensation in the first quarter of 2020 included reversal of expenses related to cancellation of certain equity grants.
Selling, General and Administrative Expenses (SG&A). SG&A expenses for the first quarter of 2021 increased to $22.4 million, compared to $20.9 million for the first quarter of 2020. Compensation and related personnel costs increased due to higher headcount and an accrual of benefits for a former executive in connection with his retirement, offset by the decrease in business travel due to COVID-19 travel restrictions. Non-cash stock-based compensation increased due to higher headcount.
Income from Operations and Net Income. Income from operations for the first quarter of 2021 was $28.5 million compared to a loss of $19.3 million in the first quarter of 2020. Net income for the first quarter of 2021 was $0.9 million compared to a net loss of $12.6 million for the first quarter of 2020. Basic and diluted net income per share was $0.01 for the first quarter of 2021, compared to a basic net loss of $0.15 per share and diluted net loss per share of $0.25 in the first quarter of 2020.
Cash Position. Cash, cash equivalents and marketable securities totaled $232.7 million at March 31, 2021. 2021 Global Data Point.