Third Quarter and First Nine-Month Product
Revenue Increased 16% and 18%, respectively from Prior Year
Periods
Raising Full-Year 2024 Total Product Revenue
Guidance to the Range of $177 million to $179 million and INTERCEPT
Fibrinogen Complex Revenue Guidance to a range of $9 to $10
million
Cerus Corporation (Nasdaq: CERS) today announced financial
results for its third quarter and nine months ended September 30,
2024.
Total revenue for the three and nine months ended September 30,
2024 was comprised of (in thousands, except %):
Three Months Ended
Nine Months Ended
September 30,
Change
September 30,
Change
2024
2023
$
%
2024
2023
$
%
Product Revenue
$
46,017
$
39,772
$
6,245
16
%
$
129,461
$
109,599
$
19,862
18
%
Government Contract Revenue
4,639
7,479
(2,840
)
-38
%
15,109
23,856
(8,747
)
-37
%
Total Revenue
$
50,656
$
47,251
$
3,405
7
%
$
144,570
$
133,455
$
11,115
8
%
Recent highlights include:
- Partnered with U.S. Biomedical Advanced Research and
Development Authority (BARDA) for new, six-year contract with value
up to $248 million designed to support advancement of INTERCEPT®
Blood System for Red Blood Cells (RBCs) beyond U.S. Phase 3 studies
through potential PMA licensure and into commercialization.
- CE Mark review for INTERCEPT RBCs concluded without approval;
assessing strategy for potential future regulatory submission in
collaboration with Notified Body, TÜV-SÜD.
- Further expanded U.S. manufacturing capacity for INTERCEPT
Fibrinogen Complex (IFC) following receipt of three additional
biologics license application (BLA) approvals by Cerus IFC
production partners.
- Multiple presentations across the INTERCEPT product portfolio
at this month’s 2024 Association for Advancement of Blood &
Biotherapies (AABB) Annual Meeting, including real-world case
studies for IFC and clinical data from the U.S. Phase 3 ReCePI
trial.
- Submitted CE Mark dossier for LED illuminator in Europe to
TÜV-SÜD.
- Narrowed GAAP net loss attributable to Cerus Corporation to
$2.9 million and generated positive non-GAAP adjusted EBITDA of
$4.4 million for the third quarter.
- Generated positive operating cash flows for the third straight
quarter of 2024 bringing year-to-date positive operating cash flows
to $6.4 million.
“Our performance, both commercially and financially, was very
strong for the third quarter,” stated William “Obi” Greenman,
Cerus’ president and chief executive officer. “In addition to the
organic growth in our North American INTERCEPT platelet business,
we are pleased to have secured meaningful additional U.S.
manufacturing capacity for IFC with the new BLA approvals, which
will allow us to address the growing demand for the product. As a
result of our strong performance during the first three quarters
coupled with our expectations for future growth in our business
segments, we are raising our full year product revenue guidance and
increasing the lower end of our IFC guidance. Beyond the top-line,
we have also delivered on our bottom-line and cashflow targets for
Q3. We believe we are on track to hit our full-year 2024 goals as
the year wraps up.”
“With respect to our development pipeline, we are pleased to
have submitted our LED illuminator regulatory filing in Europe in
the third quarter,” continued Greenman. “This much-anticipated new
technology platform will enable operational improvements alongside
the dependability that our customers have grown to expect from the
INTERCEPT System. As we reported earlier this month, our RBC
program remains a key focus for us in both the U.S., with the new
BARDA contract accelerating a number of initiatives, as well as in
the EU, where we anticipate an enhanced regulatory submission that
we expect will incorporate the ReCePI Phase 3 clinical data.”
Revenue
Product revenue during the third quarter of 2024 was $46.0
million, compared to $39.8 million during the prior year period.
This year-over-year increase of 16% was driven primarily by growth
in the Company’s platelets business, particularly in North America.
Third-quarter product revenue included sales of IFC, which were
$2.3 million, up from $1.7 million during the prior year
period.
Third-quarter 2024 government contract revenue was $4.6 million,
compared to $7.5 million during the prior year period. The
Company’s government contract revenue was comprised of funding
associated with research and development (R&D) activities
related to the INTERCEPT Blood System for RBCs as well as efforts
related to the development of next-generation pathogen reduction
technology to treat whole blood and development of a lyophilized
IFC. Reported government contract revenue during the third quarter
of 2024 decreased versus the prior year period, primarily due to
completion of the U.S. Phase 3 ReCePI clinical trial for INTERCEPT
RBCs.
Product Gross Profit & Margin
Product gross profit for the third quarter of 2024 was $26.2
million, increasing by 20% over the prior year period. Product
gross margin for the third quarter of 2024 improved to 56.9%
compared to 54.9% for the prior year period. Absent any
unanticipated factor, Cerus expects product gross margin levels to
remain relatively consistent for the fourth quarter.
Operating Expenses
Total operating expenses for the third quarter of 2024 were
$31.8 million, compared to $34.5 million for the same period of the
prior year, reflecting a decrease of 8%. This decline resulted from
decreases in R&D, partially offset by increases in selling,
general and administrative (SG&A) expenses.
R&D expenses for the third quarter of 2024 were $14.0
million, compared to $16.8 million for the prior year period. The
primary drivers for the decrease in R&D expenses were the
completion of the Company’s ReCePI Phase 3 clinical trial during
the first quarter of 2024 and the full impact of the previous
year’s restructuring.
SG&A expenses for the third quarter of 2024 were $17.8
million, compared to $16.2 million for the prior year period. The
primary driver for the increase in SG&A expenses was non-cash
stock-based compensation. The Company continues to expect SG&A
expenses will be relatively consistent for the balance of the year,
driving increased leverage at these levels.
Net Loss Attributable to Cerus Corporation
Net loss attributable to Cerus Corporation for the third quarter
of 2024 was $2.9 million, or $0.02 per basic and diluted share,
compared to a net loss attributable to Cerus Corporation of $7.3
million, or $0.04 per basic and diluted share, for the third
quarter of 2023. Net loss attributable to Cerus Corporation for the
first nine months of 2024 was $18.4 million, compared to a net loss
attributable to Cerus Corporation of $36.2 million for the first
nine months of 2023.
Non-GAAP Adjusted EBITDA
Non-GAAP adjusted EBITDA for the third quarter of 2024 was a
positive $4.4 million, compared to a loss of $1.0 million for the
third quarter of 2023. Non-GAAP adjusted EBITDA was a positive $2.5
million for the first nine months of 2024, compared to a loss of
$15.5 million for the first nine months of 2023. The Company
continues to focus on achieving non-GAAP adjusted EBITDA breakeven
for the full-year 2024. For additional information, please see
definitions and the reconciliation of this non-GAAP measure to net
loss attributable to Cerus Corporation accompanying this
release.
Balance Sheet & Cash Flows
At September 30, 2024, the Company had cash and cash equivalents
and short-term investments of $75.6 million, compared to $71.2
million at June 30, 2024, and $65.9 million at December 31,
2023.
As of September 30, 2024, the Company had $65.0 million
outstanding on its term loan and $18.5 million drawn on its
revolving credit facility. The Company’s revolving line of credit
allows for an additional $16.5 million, which is dependent on
eligible assets supporting the borrowing base.
For the third quarter of 2024, the Company generated positive
cash flows of $4.1 million from operations compared to cash used in
operations of $10.5 million during the prior year period. These
improvements were in line with the Company’s expectations and will
continue to be a focus area going forward.
Raising 2024 Product Revenue Guidance
The Company is raising its full-year 2024 product revenue
guidance to a range of $177 million to $179 million from the prior
range of $175 million to $178 million. Alongside this raise in
guidance, the Company is raising the bottom end of its full-year
2024 IFC revenue guidance to a new range of $9 million to $10
million from $8 million to $10 million.
Quarterly Conference Call
The Company will host a conference call at 4:30 P.M. EDT this
afternoon, during which management will discuss the Company’s
financial results and provide a general business overview and
outlook. To listen to the live webcast, please visit the Investor
Relations page of the Cerus website at http://www.cerus.com/ir.
A replay will be available on Cerus’ website approximately three
hours after the call through November 20, 2024.
ABOUT CERUS
Cerus Corporation is dedicated solely to safeguarding the
world’s blood supply and aims to become the preeminent global blood
products company. Headquartered in Concord, California, the company
develops and supplies vital technologies and pathogen-protected
blood components to blood centers, hospitals, and ultimately
patients who rely on safe blood. The INTERCEPT Blood System for
platelets and plasma is available globally and remains the only
pathogen reduction system with both CE mark and FDA approval for
these two blood components. In the U.S., the INTERCEPT Blood System
for Cryoprecipitation is approved for the production of Pathogen
Reduced Cryoprecipitated Fibrinogen Complex (commonly referred to
as INTERCEPT Fibrinogen Complex), a therapeutic product for the
treatment and control of bleeding, including massive hemorrhage,
associated with fibrinogen deficiency. The INTERCEPT red blood cell
system is in late-stage clinical development. For more information
about Cerus, visit www.cerus.com and follow us on LinkedIn.
INTERCEPT and the INTERCEPT Blood System are trademarks of Cerus
Corporation.
Forward-Looking Statements
Except for the historical statements contained herein, this
press release contains forward-looking statements concerning Cerus’
products, prospects and expected results, including statements
relating to: Cerus’ 2024 annual product revenue guidance and its
belief in its ability to achieve its full-year 2024 goals; Cerus’
expectation for full-year 2024 non-GAAP adjusted EBITDA breakeven;
Cerus’ expectations with respect to product revenue gross margin
levels in 2024; the potential value of and funding opportunity
under the new BARDA agreement and Cerus’ expectations with respect
to activities intended to be funded under the new BARDA agreement;
the potential premarket approval (PMA) licensure of and
commercialization of INTERCEPT RBCs; the potential for Cerus to
submit an expanded new regulatory submission for the INTERCEPT RBC
system in Europe; Cerus continuing to have access to $16.5 million
under its revolving line of credit; and other statements that are
not historical fact. Actual results could differ materially from
these forward-looking statements as a result of certain factors,
including, without limitation: risks associated with the
commercialization and market acceptance of, and customer demand
for, the INTERCEPT Blood System, including the risks that Cerus may
not (a) meet its 2024 annual product revenue guidance or its
full-year 2024 goals, (b) effectively continue to launch and
commercialize the INTERCEPT Blood System for Cryoprecipitation, (c)
grow sales globally, including in its U.S. and European markets,
and/or realize expected revenue contribution resulting from its
U.S. and European market agreements, (d) realize meaningful and/or
increasing revenue contributions from U.S. customers in the near
term or at all, particularly since Cerus cannot guarantee the
volume or timing of commercial purchases, if any, that its U.S.
customers may make under Cerus’ commercial agreements with these
customers, (e) effectively expand its commercialization activities
into additional geographies and/or (f) realize any revenue
contribution from new product offerings, including extended shelf
life platelet processing sets, or its pipeline product candidates;
risks associated with macroeconomic developments, including ongoing
military conflicts in Ukraine and Israel and the COVID-19 pandemic
and resulting global economic and financial disruptions, and the
current and potential future negative impacts to Cerus’ business
operations and financial results such as the current and potential
additional disruptions to the U.S. and EMEA blood supply resulting
from the evolving effects of the COVID-19 pandemic; risks
associated with Cerus’ lack of longer-term commercialization
experience with the INTERCEPT Blood System for Cryoprecipitation
and in the United States generally, and its ability to maintain an
effective and qualified U.S.-based commercial organization, as well
as the resulting uncertainty of its ability to achieve market
acceptance of and otherwise successfully commercialize the
INTERCEPT Blood System in the United States, including as a result
of licensure requirements that must be satisfied by U.S. customers
prior to their engaging in interstate transport of blood components
processed using the INTERCEPT Blood System; risks related to the
highly concentrated market for the INTERCEPT Blood System; risks
related to how any future platelet additive solution (PAS) supply
disruption could affect INTERCEPT’s acceptance in the marketplace;
risks related to how any future PAS supply disruption might affect
current commercial contracts; risks related to Cerus’ ability to
demonstrate to the transfusion medicine community and other health
care constituencies that pathogen reduction, including IFC for the
treatment and control of bleeding, and the INTERCEPT Blood System
is safe, effective and economical; risks related to the uncertain
and time-consuming development and regulatory process, including
the risks that (a) Cerus may be unable to comply with the FDA’s
post-approval requirements for the INTERCEPT Blood System,
including by successfully completing required post-approval
studies, which could result in a loss of U.S. marketing approval(s)
for the INTERCEPT Blood System, (b) any changes to the INTERCEPT
platelet processing sets may require additional aging and stability
data in order to satisfy regulators and maintain historical label
claims; (c) additional manufacturing site Biologics License
Applications necessary for Cerus to more broadly distribute the
INTERCEPT Blood System for Cryoprecipitation may not be obtained in
a timely manner or at all, (d) the FDA could require additional
clinical data not contemplated by the new BARDA agreement to
support Cerus’ planned modular PMA submission for the INTERCEPT RBC
system and that if additional clinical development is required, it
will require funding that Cerus does not currently have, (e) Cerus’
planned modular PMA submission for INTERCEPT RBCs may not be
accepted by the FDA for review in a timely manner or at all or, if
accepted for review, may not be approved by the FDA in a timely
manner or at all, (f) Cerus may be unable to address the issues
that prevented CE mark approval for the INTERCEPT RBC system in a
timely manner or at all, (g) Cerus may be unable to meet the
applicable requirements for a new regulatory submission in Europe
for INTERCEPT RBCs in a timely manner or at all, and that Cerus may
otherwise determine to substantially delay or abandon its efforts
to seek CE Mark approval of the INTERCEPT RBC system, and (h) Cerus
may be unable to obtain the requisite regulatory approvals to
advance its pipeline programs, including INTERCEPT RBCs, and bring
them to market in a timely manner or at all; the uncertain nature
of BARDA’s funding over which Cerus has no control as well as
actions of Congress and governmental agencies that may adversely
affect the availability of funding under the new BARDA agreement
and/or BARDA’s exercise of any potential subsequent option periods,
such that the total actual value of the new BARDA agreement to
Cerus may be substantially less than anticipated; unfavorable
provisions in government contracts, including the risks that BARDA
is entitled to terminate the new BARDA agreement at any time for
its convenience and is not otherwise obligated to provide continued
funding beyond current year amounts from Congressionally approved
annual appropriations; risks related to product safety, including
the risk that the septic platelet transfusions may not be avoidable
with the INTERCEPT Blood System; risks related to adverse market
and economic conditions, including continued or more severe adverse
fluctuations in foreign exchange rates and/or continued or more
severe weakening in economic conditions resulting from military
conflicts, the COVID-19 pandemic, rising interest rates, inflation
or otherwise in the markets where Cerus currently sells and is
anticipated to sell its products; Cerus’ reliance on third parties
to market, sell, distribute and maintain its products; Cerus’
ability to maintain an effective, secure manufacturing supply
chain, including the risks that (a) Cerus’ supply chain could be
negatively impacted as a result of the evolving impact of
macroeconomic developments, including the ongoing military
conflicts in Ukraine and Israel, rising interest rates, inflation
and the evolving effects of the COVID-19 pandemic, (b) Cerus’
manufacturers could be unable to comply with extensive FDA and
foreign regulatory agency requirements, and (c) Cerus may be unable
to maintain its primary kit manufacturing agreement and its other
supply agreements with its third party suppliers; Cerus’ ability to
identify and obtain additional partners to manufacture the
INTERCEPT Blood System for Cryoprecipitation; risks associated with
Cerus’ ability to access additional funds under its credit facility
and to meet its debt service obligations, and its need for
additional funding; the impact of legislative or regulatory
healthcare reforms that may make it more difficult and costly for
Cerus to produce, market and distribute its products; risks related
to future opportunities and plans, including the uncertainty of
Cerus’ future capital requirements and its future revenues and
other financial performance and results, including as it relates to
Cerus’ 2024 annual product revenue guidance and its expectations
for 2024 non-GAAP adjusted EBITDA; as well as other risks detailed
in Cerus’ filings with the Securities and Exchange Commission,
including under the heading “Risk Factors” in Cerus’ Quarterly
Report on Form 10-Q for the quarter ended September 30, 2024, filed
with the SEC on October 30, 2024. Cerus disclaims any obligation or
undertaking to update or revise any forward-looking statements
contained in this press release.
Use of Non-GAAP Financial Measures
We define adjusted EBITDA as net loss attributable to Cerus
Corporation as reported on the consolidated statement of
operations, as adjusted to exclude, as applicable for the reporting
period(s) presented, (i) net loss attributable to noncontrolling
interest, (ii) provision for income taxes, (iii) foreign exchange
(loss)/gain, (iv) interest income (expense), (v) other income
(expense), net, (vi) depreciation and amortization, (vii)
share-based compensation, (viii) goodwill and asset impairments,
(ix) costs associated with our noncontrolling interest in our joint
venture in China, (x) revenue and direct costs associated with our
government contracts and (xi) restructuring charges. We are
presenting this non-GAAP financial measure to assist investors in
assessing our operating results. Management believes this non-GAAP
information is useful for investors, when considered in conjunction
with Cerus’ GAAP financial statements, because management uses such
information internally for its operating, budgeting and financial
planning purposes. Non-GAAP information is not prepared under a
comprehensive set of accounting rules and should only be used to
supplement an understanding of Cerus’ operating results as reported
under GAAP. This non-GAAP financial measure should not be
considered in isolation from, or as a substitute for, financial
information prepared in accordance with GAAP. This non-GAAP
financial measure is not necessarily comparable to similarly-titled
measures presented by other companies.
Investors should note that Cerus has not provided a
reconciliation of anticipated non-GAAP adjusted EBITDA for the year
ending December 31, 2024 to projected GAAP net loss attributable to
Cerus Corporation for the year ending December 31, 2024 because
certain items such as share-based compensation that are components
of GAAP net loss attributable to Cerus Corporation cannot be
reasonably projected due to the significant impact of changes in
Cerus’ stock price and other factors. These components of GAAP net
loss attributable to Cerus Corporation could significantly impact
the reported GAAP net loss attributable to Cerus Corporation.
Supplemental Tables
Three Months Ended
Nine Months Ended
September 30,
September 30,
2024 vs. 2023
2024 vs. 2023
Platelet Kit Growth
North America
18%
24%
International
1%
1%
Worldwide
13%
14%
Change in Calculated Number of
Treatable Platelet Doses
North America
21%
28%
International
0%
3%
Worldwide
14%
19%
* Dose treatable calculation
based on the number of kits sold and the product configuration
(single, double, and triple dose kits)
CERUS CORPORATION
REVENUE BY REGION
(in thousands, except
percentages)
Three Months Ended
Nine Months Ended
September 30,
Change
September 30,
Change
2024
2023
$
%
2024
2023
$
%
North America
$
31,514
$
25,983
$
5,531
21
%
$
87,783
$
67,077
$
20,706
31
%
Europe, Middle East and Africa
13,807
13,614
193
1
%
40,246
41,175
(929
)
-2
%
Other
696
175
521
298
%
1,432
1,347
85
6
%
Total product revenue
$
46,017
$
39,772
$
6,245
16
%
$
129,461
$
109,599
$
19,862
18
%
CERUS CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per
share data)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2024
2023
2024
2023
Product revenue
$
46,017
$
39,772
$
129,461
$
109,599
Cost of product revenue
19,818
17,956
57,324
49,158
Gross profit on product revenue
26,199
21,816
72,137
60,441
Government contract revenue
4,639
7,479
15,109
23,856
Operating expenses:
Research and development
14,013
16,783
43,464
53,351
Selling, general and administrative
17,786
16,155
56,558
58,247
Restructuring
-
1,600
-
3,728
Total operating expenses
31,799
34,538
100,022
115,326
Loss from operations
(961
)
(5,243
)
(12,776
)
(31,029
)
Total non-operating expense, net
(1,897
)
(1,965
)
(5,529
)
(4,976
)
Loss before income taxes
(2,858
)
(7,208
)
(18,305
)
(36,005
)
Provision for income taxes
76
78
94
253
Net loss
(2,934
)
(7,286
)
(18,399
)
(36,258
)
Net loss attributable to noncontrolling
interest
-
(19
)
(2
)
(97
)
Net loss attributable to Cerus
Corporation
$
(2,934
)
$
(7,267
)
$
(18,397
)
$
(36,161
)
Net loss per share attributable to Cerus
Corporation:
Basic and diluted
$
(0.02
)
$
(0.04
)
$
(0.10
)
$
(0.20
)
Weighted average shares outstanding:
Basic and diluted
185,424
180,938
184,170
179,950
CERUS CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands)
September 30,
December 31,
2024
2023
ASSETS
(unaudited)
Current assets:
Cash and cash equivalents
$
21,575
$
11,647
Short-term investments
53,990
54,205
Accounts receivable, net
24,361
35,500
Current inventories
36,538
39,868
Prepaid and other current assets
4,148
3,221
Total current assets
140,612
144,441
Non-current assets:
Property and equipment, net
7,437
8,640
Operating lease right-of-use assets
8,936
10,713
Goodwill
1,316
1,316
Non-current inventories
14,811
19,501
Other assets and restricted cash
16,427
13,137
Total assets
$
189,539
$
197,748
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable and accrued
liabilities
$
31,743
$
43,067
Debt – current
18,521
20,000
Operating lease liabilities – current
2,260
2,452
Deferred revenue – current
1,821
2,002
Total current liabilities
54,345
67,521
Non-current liabilities:
Debt – non-current
64,847
59,796
Operating lease liabilities –
non-current
12,270
13,751
Other non-current liabilities
3,796
3,236
Total liabilities
135,258
144,304
Stockholders' equity:
53,489
52,650
Noncontrolling interest
792
794
Total liabilities and stockholders'
equity
$
189,539
$
197,748
CERUS CORPORATION
UNAUDITED RECONCILIATION OF
NON-GAAP ADJUSTED EBITDA
(in thousands)
Three Months Ended
Nine Months Ended
September 30
September 30
2024
2023
2024
2023
Net loss attributable to Cerus
Corporation
$
(2,934
)
$
(7,267
)
$
(18,397
)
$
(36,161
)
Adjustments to net loss attributable to
Cerus Corporation:
Net loss attributable to noncontrolling
interest
-
(19
)
(2
)
(97
)
Provision for income taxes
76
78
94
253
Total non-operating expense, net (i)
1,897
1,965
5,529
4,976
Loss from operations
(961
)
(5,243
)
(12,776
)
(31,029
)
Adjustments to loss from operations:
Operating depreciation and
amortization
1,120
1,143
3,464
3,313
Government contract revenue (ii)
(4,639
)
(7,479
)
(15,109
)
(23,856
)
Direct expenses attributable to government
contracts (iii)
3,038
4,991
9,513
16,800
Share-based compensation (iv)
5,830
3,979
17,363
15,368
Costs attributable to noncontrolling
interest (v)
-
37
3
210
Restructuring (vi)
-
1,600
-
3,728
Non-GAAP adjusted EBITDA
$
4,388
$
(972
)
$
2,458
$
(15,466
)
i. Includes interest income/expense and
foreign exchange gains/losses.
ii. Represents revenue related to the cost
reimbursement provisions under our government contracts.
iii. Represents the direct expenses
attributable to work supporting government contracts, which are
reimbursed and reflected under government contract revenue in the
condensed consolidated statement of operations.
iv. Represents non-cash stock-based
compensation.
v. Represents costs associated with the
noncontrolling interest in Cerus Zhongbaokang (Shandong) Biomedical
Co., LTD.
vi. Represents costs associated with the
Company’s restructuring plan implemented in June 2023.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241030751950/en/
Jessica Hanover Cerus Corporation 925-288-6137
Cerus (NASDAQ:CERS)
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