Dynavax Q1 2024 Financial Results and Business Updates

Dynavax Technologies Corporation, a biopharmaceutical company specializing in innovative vaccines, released its financial results and business update for the first quarter of 2024 on May 8, 2024. The company's HEPLISAV-B® vaccine observed a 10% increase in net product revenue year-over-year, reaching approximately $48 million. Dynavax reiterated its full-year net product revenue guidance for HEPLISAV-B, estimating between $265 and $280 million.

The CEO of Dynavax, Ryan Spencer, attributed the modest dip in the hepatitis B vaccine market during the first quarter to a prolonged cold and flu season limiting vaccination opportunities. However, he emphasized the significant market potential, as over 130 million adults in the U.S. are eligible for hepatitis B vaccination, with the majority yet to be vaccinated. Spencer highlighted the increasing engagement of retail pharmacies and healthcare providers in hepatitis B vaccine campaigns, boosting market activity.

Dynavax is also making strides with its clinical pipeline, including the initiation of a Phase 1/2 trial for its Z-1018 shingles vaccine. The U.S. FDA has cleared Dynavax's Investigational New Drug (IND) application, allowing the company to proceed with a trial designed to evaluate the safety, tolerability, and immunogenicity of Z-1018 compared to Shingrix®. This trial will include around 440 healthy adults aged 50 to 69 and is expected to begin in the second quarter of 2024, with results anticipated by the second half of 2025.

The company continues to develop its CpG 1018® adjuvant, which has shown an ability to enhance immune response across various clinical trials and commercial applications. Dynavax is leveraging this adjuvant in its ongoing research programs for vaccines targeting diseases such as shingles, Tdap (tetanus, diphtheria, and pertussis), and plague.

In collaboration with the U.S. Department of Defense, Dynavax is working on a plague vaccine candidate. The Department recently modified the contract to add approximately $4 million for CMC (Chemistry, Manufacturing, and Controls) work, bringing the total funding to $38 million through 2025. Results from the Phase 2 clinical trial and nonhuman primate challenge study for the plague vaccine are expected in the fourth quarter of 2024.

Dynavax posted total revenues of $50.8 million for the first quarter of 2024, up from $46.9 million in the same period the previous year. The HEPLISAV-B vaccine alone accounted for $47.8 million of this total, compared to $43.5 million in the first quarter of 2023. Other revenue, primarily from the plague vaccine agreement, decreased slightly to $2.9 million.

The company reported a reduction in its cost of sales for HEPLISAV-B to $11 million, down from $14.7 million, due to lower manufacturing costs. Research and development (R&D) expenses slightly decreased to $13.5 million, while selling, general, and administrative expenses (SG&A) rose to $44.1 million, primarily driven by increased staffing and marketing efforts.

Dynavax's GAAP net loss narrowed to $8.7 million, or $0.07 per share, from $24.3 million, or $0.19 per share, in the first quarter of 2023. As of March 31, 2024, the company held $723.5 million in cash, cash equivalents, and marketable securities.

For the 2024 fiscal year, Dynavax projects HEPLISAV-B net product revenue between $265 and $280 million, with a gross margin of approximately 80%. R&D expenses are expected to range from $60 to $75 million, while SG&A expenses are projected to be between $160 and $180 million. The company anticipates an increase in cash, cash equivalents, and marketable securities by the end of the year compared to December 31, 2023.

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