SK Biopharmaceuticals (326030.KS) is expected to post solid third-quarter results, helped by rising prescriptions of its epilepsy drug Xcopri and a milestone payment tied to the drug's approval in Japan. But a partial U.S. clinical hold on opacalim, an epilepsy drug candidate the company is seeking to license as its next growth driver, has made the resumption of new patient enrollment a key variable going forward.
Hana Securities on the 19th forecast third-quarter revenue of 253.2 billion won, up 32.0% from a year earlier. It estimated operating profit at 96.8 billion won, a 38.0% increase over the same period. Revenue broadly matches market consensus, while operating profit exceeds expectations by 5.6%. The operating margin is projected at 38.2%.
U.S. prescriptions of Xcopri, the company's flagship product, rose 6.3% from the previous quarter. Based on current prescription volumes, Hana Securities estimated the drug's U.S. revenue this year at $599 million, above the company's annual guidance of $550 million to $580 million.
The approval of cenobamate as a new drug in Japan on Sept. 16 also supported third-quarter results. Ono Pharmaceutical, the Japanese partner, won manufacturing and marketing approval for Xcopri in patients with partial-onset seizures, entitling SK Biopharmaceuticals to a milestone payment under the agreement. Royalties from Japanese sales and revenue from supplying the active pharmaceutical ingredient are expected to follow.
Costs tied to research and development and to securing new pipeline assets are set to increase in the second half. SK Biopharmaceuticals is running a Phase 1 trial of SKL35501, an NTSR1-targeting radiopharmaceutical therapy, and is preparing follow-on development of SKT-18416, a p300-targeting protein degrader, and SKL37321, a CA9-targeting radiopharmaceutical therapy. Hana Securities said profitability should remain solid in the third quarter despite the higher costs, citing the Japan approval milestone.
Attention in the market has turned to when the opacalim trials will return to normal. The U.S. Food and Drug Administration last month requested additional preclinical data and halted part of the clinical program, citing toxicity seen in rodent studies from a specific metabolite produced when opacalim breaks down in the body. The entire program has not been stopped. RISE3, a Phase 3 trial that has completed patient recruitment, is continuing dosing on schedule, while RISE2, which was still recruiting, has suspended only new patient enrollment.
Hana Securities said the side effects the FDA is concerned about have not occurred among the roughly 1,200 people who have received opacalim to date, adding that Biohaven is working toward resuming the trial in November.
