gmab_Current_Folio_6K_News_Release_Interim_Report

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 6-K


REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a‑16 OR 15d‑16

OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE MONTH OF AUGUST 2019


COMMISSION FILE NUMBER 001-38976 

Genmab A/S
(Exact name of Registrant as specified in its charter)

Kalvebod Brygge 43

1560 Copenhagen V

Denmark

+45 70 20 27 28
(Address of principal executive offices)


Indicate by check mark whether the registrant files or will file annual reports under cover Form 20‑F or Form 40‑F.

Form 20‑F       Form 40‑F 

Indicate by check mark if the registrant is submitting the Form 6‑K in paper as permitted by Regulation S‑T Rule 101(b)(1)

Yes       No     

Indicate by check mark if the registrant is submitting the Form 6‑K in paper as permitted by Regulation S‑T Rule 101(b)(7)

Yes       No     

Exhibit 99.1 to this report on Form 6-K shall be deemed to be incorporated by reference in Genmab A/S’s registration statement on Form S-8 (File No. 333-232693) and in the outstanding prospectus contained in such registration statement.

 

 

 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

 

GENMAB A/S

 

 

 

 

BY:

/s/ David A. Eatwell

 

 

Name: David A.Eatwell

 

 

Title: Executive Vice President & Chief Financial Officer

 

DATE: August 14, 2019 

 

EXHIBIT INDEX

A

 

Exhibit

Description of Exhibit

 

 

99.1

Interim Report Dated August 14, 2019     

101.INS

XBRL Instance Document

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

XBRL Taxonomy Extension Labels Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

 

gmab_Ex99_1

Exhibit 99.1

Picture 3

Genmab Announces Financial Results for the First Half of 2019 and Updates 2019 Financial Guidance

August 14, 2019; Copenhagen, Denmark;

Interim Report for the First Half of 2019

Highlights

·

Registration statement filed with the U.S. Securities and Exchange Commission for the proposed public offering of American Depository Shares and application submitted for listing of the ADSs on the Nasdaq Global Select Market under the symbol “GMAB.” The public offering and listing were completed in July.

·

Agreement signed with Janssen Biotech, Inc. (Janssen) to collaborate exclusively on next-generation CD38 antibody product candidate, HexaBody®-CD38.

·

The U.S. Food and Drug Administration (U.S. FDA) approved DARZALEX® (daratumumab) in combination with lenalidomide and dexamethasone for the treatment of adult patients with newly diagnosed multiple myeloma who are ineligible for autologous stem cell transplant

·

The U.S. FDA granted Priority Review for daratumumab in combination with bortezomib, thalidomide and dexamethasone as treatment for newly diagnosed patients with multiple myeloma who are candidates for autologous stem cell transplant.

·

Janssen initiated Phase III study to examine daratumumab plus lenalidomide as maintenance treatment in patients with newly diagnosed multiple myeloma.

·

DARZALEX net sales increased 49% over H1 2018 to USD 1,403 million, resulting in royalty income of DKK 1,169 million.

·

 Genmab is updating its 2019 financial guidance due to increased royalty income related to the sales of DARZALEX and increased operating expenses as a result of the advancement of our product pipeline, resulting in a small increase in projected operating income.

“The first half of 2019 brought truly transformational change to Genmab as we began the process of becoming a dual-listed company, with the potential to trade shares in both the U.S. (in the form of ADSs) and in Denmark. We also built upon our already successful relationship with Janssen with the signing of an agreement to collaborate exclusively on the next-generation CD38 antibody product candidate, HexaBody-CD38. We have seen encouraging pre-clinical data from HexaBody-CD38 and believe it has the potential to extend the promise of CD38-targeted therapies beyond what is currently available for patients,” said Jan van de Winkel, Ph.D., Chief Executive Officer of Genmab. “In addition to these key events, the first half of 2019 also saw the highly anticipated U.S. FDA approval for DARZALEX, based on the Phase III MAIA data. Now that this indication has been approved many more patients in the U.S. who are newly diagnosed with multiple myeloma will have a DARZALEX containing regimen as a choice for their initial therapy.”

Financial Performance First Half of 2019

·

Revenue was DKK 1,365 million in the first half of 2019 compared to DKK 1,191 million in the first half of 2018. The increase of DKK 174 million, or 15%, was mainly driven by higher DARZALEX royalties and reimbursement income from our collaborations with Seattle Genetics and BioNTech, partly offset by the one-time payment from Novartis of USD 50 million (DKK 304 million) during the first half of 2018 for lost potential milestones and royalties following announcement of Novartis’ intention to transition Arzerra® (ofatumumab) to limited availability via compassionate use programs for chronic lymphocytic leukemia (CLL) in non-U.S. markets.

·

Net sales of DARZALEX by Janssen were USD 1,403 million in the first half of 2019 compared to USD 943 million in the first half of 2018, an increase of USD 460 million, or 49%. According to Johnson & Johnson, sales in the second quarter of 2019 included a one-time adjustment related to

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 1/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 2

Genmab Announces Financial Results for the First Half of 2019 and Updates 2019 Financial Guidance

the completion of pricing and reimbursement discussions in certain European countries, which positively impacted this worldwide second quarter operational growth by 16 percentage points.

·

Operating expenses were DKK 1,254 million in the first half of 2019 compared to DKK 732 million in the first half of 2018. The increase of DKK 522 million, or 71%, was driven by the advancement of enapotamab vedotin and tisotumab vedotin, additional investments in our product pipeline, and the increase in new employees to support the expansion of our product pipeline.

·

Operating income was DKK 111 million in the first half of 2019 compared to DKK 459 million in the first half of 2018. As anticipated, the decrease of DKK 348 million, or 76%, was driven primarily by increased operating expenses and the one-time payment from Novartis in 2018.

Subsequent Event

·

July:  Completion of public offering and listing of American Depository Shares (ADSs) on Nasdaq Global Select Market under the symbol “GMAB”. Gross proceeds from the issuance of new shares amounted to USD 506 million (DKK 3,368 million) with a corresponding increase in share capital of 2,850,000 ordinary shares or 28,500,000 American Depository Shares (“ADSs”). Further, the underwriters’ exercised in full their option to purchase an additional 427,500 ordinary shares or 4,275,000 ADSs bringing the total gross proceeds of the offering to USD 582 million (DKK 3,873 million). The public offering price of $17.75 per ADS, corresponded to a subscription price of DKK 1,181.80 per New Share at the U.S. dollar/DKK exchange rate of DKK 6.6580 per USD 1.00 on July 17, 2019, multiplied by the ADS-to-share ratio of ten-to-one. Underwriting commissions paid were USD 32 million (DKK 213 million). Total share capital following the public offering amounted to DKK 64,967,643.

Outlook

Genmab is updating its 2019 financial guidance published on February 20, 2019 due to increased royalty income related to the sales of DARZALEX and increased operating expenses as a result of the advancement of our product pipeline.

 

 

 

 

 

 

 

 

Revised

 

Previous

MDKK

    

Guidance

    

Guidance

Revenue

 

4,800

 

4,600

Operating expenses

 

(2,750)

 

(2,600)

Operating income

 

2,050

 

2,000

 

Conference Call

Genmab will hold a conference call in English to discuss the results for the first half of 2019 today, Wednesday, August 14, at 6:00 pm CEST, 5:00 pm BST or 12:00 pm EDT. To join the call dial +1 631 510 7495 (U.S. participants) or +44 2071 928000 (international participants) and provide conference code 4966139.

 

A live and archived webcast of the call and relevant slides will be available at www.genmab.com.

Contact:

Marisol Peron, Corporate Vice President, Communications & Investor Relations

T: +1 609 524 0065; E: mmp@genmab.com

For Investor Relations:

Andrew Carlsen, Senior Director, Investor Relations

T: +45 3377 9558; E: acn@genmab.com

 

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 2/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

CONTENTS

 

 

CONSOLIDATED KEY FIGURES 

4

OUTLOOK 

5

KEY 2019 PRIORITIES 

6

PRODUCT PIPELINE 

7

PRODUCT PIPELINE AND TECHNOLOGY PROGRESS FIRST HALF OF 2019 

7

SIGNIFICANT RISKS AND UNCERTAINTIES 

16

FINANCIAL REVIEW 

17

STATEMENT OF COMPREHENSIVE INCOME FOR THE 2ND QUARTER OF 2019 

21

STATEMENT OF COMPREHENSIVE INCOME FOR THE FIRST HALF OF 2019 

22

BALANCE SHEET 

23

STATEMENT OF CASH FLOWS 

24

STATEMENT OF CHANGES IN EQUITY 

25

NOTES TO THE FINANCIAL STATEMENTS 

26

ABOUT GENMAB 

39

DIRECTORS’ AND MANAGEMENT’S STATEMENT ON THE INTERIM REPORT 

40

 

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 3/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

CONSOLIDATED KEY FIGURES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

2nd Quarter of

 

    

2nd Quarter of

    

6 Months Ended

 

    

6 Months Ended

    

Full Year

 

 

 

2019

 

 

2018*

 

June 30, 2019

 

 

June 30, 2018*

 

2018*

 

 

 

DKK'000

 

 

DKK'000

 

DKK'000

 

 

DKK'000

 

DKK'000

 

Income Statement

 

  

 

 

  

 

 

 

 

 

 

  

 

Revenue

 

773,914

 

 

509,675

 

1,364,923

 

 

1,190,687

 

3,025,137

 

Research and development expenses

 

(563,376)

 

 

(318,889)

 

(1,109,456)

 

 

(631,440)

 

(1,431,159)

 

General and administrative expenses

 

(73,371)

 

 

(55,742)

 

(144,224)

 

 

(100,158)

 

(213,695)

 

Operating expenses

 

(636,747)

 

 

(374,631)

 

(1,253,680)

 

 

(731,598)

 

(1,644,854)

 

Operating result

 

137,167

 

 

135,044

 

111,243

 

 

459,089

 

1,380,283

 

Net financial items

 

(26,639)

 

 

200,271

 

93,307

 

 

131,791

 

231,688

 

Net result

 

84,885

 

 

260,527

 

157,094

 

 

459,101

 

1,472,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet

 

  

 

 

  

 

 

 

 

 

 

  

 

Cash position**

 

6,950,953

 

 

6,070,935

 

6,950,953

 

 

6,070,935

 

6,106,094

 

Non-current assets

 

1,166,449

 

 

524,090

 

1,166,449

 

 

524,090

 

1,027,974

 

Assets

 

8,977,313

 

 

7,199,663

 

8,977,313

 

 

7,199,663

 

8,460,999

 

Shareholders' equity

 

8,286,509

 

 

6,861,225

 

8,286,509

 

 

6,861,225

 

8,014,360

 

Share capital

 

61,690

 

 

61,437

 

61,690

 

 

61,437

 

61,498

 

Investments in intangible and tangible assets

 

14,210

 

 

19,019

 

35,574

 

 

47,791

 

477,366

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash Flow Statement

 

  

 

 

  

 

 

 

 

 

 

  

 

Cash flow from operating activities

 

184,829

 

 

134,876

 

832,026

 

 

598,947

 

1,014,786

 

Cash flow from investing activities

 

(772,548)

 

 

(103,924)

 

(786,082)

 

 

(786,691)

 

(1,777,553)

 

Cash flow from financing activities

 

26,120

 

 

42,332

 

15,618

 

 

(85,511)

 

(70,901)

 

Cash and cash equivalents

 

582,863

 

 

1,087,165

 

582,863

 

 

1,087,165

 

532,907

 

Cash position increase/(decrease)

 

120,681

 

 

369,763

 

844,859

 

 

648,198

 

683,357

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Ratios

 

  

 

 

  

 

 

 

 

 

 

  

 

Basic net result per share

 

1.38

 

 

4.26

 

2.56

 

 

7.51

 

24.03

 

Diluted net result per share

 

1.35

 

 

4.21

 

2.53

 

 

7.41

 

23.73

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period-end share market price

 

1,207.00

 

 

984.80

 

1,207.00

 

 

984.80

 

1,067.50

 

Price / book value

 

8.99

 

 

8.82

 

8.99

 

 

8.82

 

8.19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders' equity per share

 

134.32

 

 

111.68

 

134.32

 

 

111.68

 

130.32

 

Equity ratio

 

92

%

 

95

%  

92

%

 

95

%  

95

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of employees (FTE***)

 

456

 

 

293

 

430

 

 

278

 

313

 

Number of employees at the end of the period

 

478

 

 

309

 

478

 

 

309

 

377

 

 

*    As disclosed in note 1 of the financial statements, prior period amounts have not been adjusted under the modified retrospective method to adopt IFRS 16 as of January 1, 2019

**  Cash, cash equivalents, and marketable securities.

*** Full-time equivalent

The figures and financial ratios have been prepared on a consolidated basis. The financial ratios have been calculated in accordance with the recommendations of the Association of Danish Financial Analysts (2017) and key figures in accordance with IFRS.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 4/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

OUTLOOK

 

 

 

 

 

 

 

 

Revised

 

Previous

MDKK

    

Guidance

    

Guidance

Revenue

 

4,800

 

4,600

Operating expenses

 

(2,750)

 

(2,600)

Operating income

 

2,050

 

2,000

 

Genmab is updating its 2019 financial guidance published on February 20, 2019 due to increased royalty income related to the sales of DARZALEX and increased operating expenses as a result of the advancement of our product pipeline.

Revenue

We expect our 2019 revenue to be approximately DKK 4,800 million, an increase of DKK 200 million compared to the previous guidance. Our projected revenue for 2019 primarily consists of DARZALEX royalties of DKK 2,885 million, an increase of DKK 200 million from the previous guidance due to positive impact of USD/DKK exchange rates movements. The DARZALEX royalties are based on estimated net sales of USD 3.0 billion in 2019. We continue to project DARZALEX milestones of approximately DKK 1,500 million related to commercial net-sales based milestones for achieving net-sales in a calendar year of both USD 2.5 billion and USD 3.0 billion respectively. The remainder of the revenue consists of cost reimbursement income, Arzerra® royalties, and DuoBody® milestones.

Operating Expenses

We anticipate that our 2019 operating expenses will be approximately DKK 2,750 million, an increase of DKK 150 million compared to the previous guidance. The increase is driven by the advancement of our product pipeline and addition of new projects.

Operating Result

We now expect the operating income to be approximately DKK 2,050 million in 2019, an increase of DKK 50 million compared to the previous guidance.

Outlook: Risks and Assumptions

In addition to factors already mentioned, the estimates above are subject to change due to numerous reasons, including but not limited to the achievement of certain milestones associated with our collaboration agreements; the timing and variation of development activities (including activities carried out by our collaboration partners) and related income and costs; DARZALEX sales and corresponding royalties to Genmab; and currency exchange rates. The financial guidance assumes that no significant agreements are entered during 2019 that could materially affect the results.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 5/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

KEY 2019 PRIORITIES

 

 

 

 

Priority

Targeted Milestones

Daratumumab

 

 

  U.S. FDA decision on Phase III MAIA multiple myeloma (MM) submission

  U.S. FDA decision on Phase III CASSIOPEIA MM submission

Phase III COLUMBA MM subcutaneous (SubQ) daratumumab safety and efficacy analysis

Ofatumumab

 

Phase III ASCLEPIOS I & II relapsing multiple sclerosis SubQ ofatumumab study completion and reporting

Tisotumab vedotin

Phase II innovaTV 204 tisotumab vedotin recurrent / metastatic cervical cancer study enrollment complete by mid-year

Innovative pipeline

 

Phase II enapotamab vedotin expansion cohort efficacy analysis

Phase I/II HexaBody®-DR5/DR5 initial clinical data

Phase I/II DuoBody-CD3xCD20 clinical data dose escalation cohorts

File INDs or CTAs for 3 new products

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 6/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

PRODUCT PIPELINE

Our own and partnered product pipeline consists of seventeen antibodies in clinical development, including two marketed products, and approximately 20 in-house and partnered pre-clinical programs. An overview of the development status of each of our products is provided in the following sections. Detailed descriptions of dosing, efficacy and safety data from certain clinical trials have been disclosed in company announcements and media releases published via the Nasdaq Copenhagen stock exchange and as of July 18, 2019 may also be found in Genmab’s filings with the U.S. Securities and Exchange Commission (SEC). Additional information is available on Genmab’s website, www.genmab.com.

PRODUCT PIPELINE AND TECHNOLOGY PROGRESS FIRST HALF OF 2019

Marketed Products

Picture 18

DARZALEX (daratumumab) – First CD38 Antibody Approved in the World

·

First-in-class human CD38 antibody in development to treat cancer

·

Approved in combination with other therapies for frontline multiple myeloma in U.S. and EU, in combination with other therapies in relapsed/refractory multiple myeloma in U.S., EU and Japan; and as monotherapy for heavily pretreated or double-refractory multiple myeloma in U.S. and EU

·

Multiple Phase III studies ongoing in multiple myeloma and amyloidosis,  and for a subcutaneous formulation

·

Early stage studies ongoing in other blood cancers

·

Collaboration with Janssen

·

Net sales of DARZALEX by Janssen were USD 1,403 million in the first half of 2019

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 7/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

DARZALEX (daratumumab) intravenous infusion is indicated for the treatment of adult patients:

 

 

 

 

Jurisdiction

Approval

Key Underlying
Clinical Trial(s)

 

 

 

United States

 

 

 

 

 

Relapsed / Refractory MM

 

 

November 2015

Monotherapy for patients who have received at least three prior lines of therapy, including a PI and an immunomodulatory agent, or who are double refractory to a PI and an immunomodulatory agent

SIRIUS

 

 

 

November 2016

In combination with Rd or Vd, for patients who have received at least one prior therapy

CASTOR; POLLUX

 

 

 

June 2017

In combination with Pom-d for patients who have received at least two prior therapies, including lenalidomide and a PI

EQUULEUS

 

 

 

 

 

 

Frontline MM

 

 

May 2018

In combination with VMP for newly diagnosed patients ineligible for ASCT

ALCYONE

 

 

 

June 2019

In combination with Rd for newly diagnosed patients ineligible for ASCT

MAIA

 

 

 

 

 

 

Split Dosing Regimen

 

 

February 2019

Option to split first infusion over two consecutive days

EQUULEUS

 

 

 

European Union

 

 

 

 

 

Relapsed / Refractory MM

 

 

April 2016

Monotherapy for patients whose prior therapy included a PI and an immunomodulatory agent and who have demonstrated disease progression on the last therapy

SIRIUS

 

 

 

February 2017

In combination with Rd or Vd for patients who have received at least one prior therapy

CASTOR; POLLUX

 

 

 

 

 

 

Frontline MM

 

 

July 2018

In combination with VMP for newly diagnosed patients ineligible for ASCT

ALCYONE

 

 

 

 

 

 

Split Dosing Regimen

 

 

December 2018

Option to split first infusion over two consecutive days

EQUULEUS

 

 

 

Japan

 

 

 

 

 

Relapsed / Refractory MM

 

 

September 2017

In combination with Rd or Vd

CASTOR; POLLUX

PI = proteasome inhibitor; Rd = lenalidomide and dexamethasone; Vd = bortezomib and dexamethasone; VMP = bortezomib, melphalan and prednisone; ASCT = autologous stem cell transplant; Pom-d = pomalidomide and dexamethasone

 

The warnings and precautions for DARZALEX include infusion reactions, interference with serological testing and interference with determination of complete response. The most frequently reported adverse reactions (incidence ≥20%) in clinical trials were: infusion reactions, neutropenia, thrombocytopenia, fatigue, nausea,

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 8/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

diarrhea, constipation, vomiting, muscle spasms, arthralgia, back pain, pyrexia, chills, dizziness, insomnia, cough, dyspnea, peripheral edema, peripheral sensory neuropathy and upper respiratory tract infection.

Please consult the full U.S. Prescribing information and the full European Summary of Product Characteristics for all the labeled safety information for DARZALEX.

Second Quarter Update

·

June: The U.S. FDA approved the use of DARZALEX in combination with Rd for the treatment of adult patients newly diagnosed with multiple myeloma who are ineligible for ASCT. The approval was based on the Phase III MAIA (MMY3008) study.

·

June: Data from Phase III daratumumab trials CASSIOPEIA (MMY3006) and COLUMBA (MMY3012) were presented in oral sessions at both the 2019 American Society of Clinical Oncology (ASCO) Annual Meeting and the 24th European Hematology Association (EHA) Annual Congress.

·

June: Enrollment complete in the Phase III APOLLO (MMY3013) trial of daratumumab in combination with pomalidomide and dexamethasone (Pom-dex) for patients with relapsed or refractory multiple myeloma who have received at least one prior line of therapy with both lenalidomide and a proteasome inhibitor.

·

May: Enrollment complete in the Phase III Aquila (SMM3001) trial of daratumumab in high-risk smoldering multiple myeloma.

·

May: The U.S. FDA granted Priority Review for daratumumab in combination with bortezomib, thalidomide and dexamethasone (VTd) as treatment for newly diagnosed patients with multiple myeloma who are candidates for ASCT. The submission was based on the Phase III CASSIOPEIA (MMY3006) data. The U.S. FDA assigned a Prescription Drug User Fee Act (PDUFA) target date of September 26, 2019 to take a decision on daratumumab in this indication.

·

April: A Supplemental new drug application (sNDA) was submitted in Japan for daratumumab in combination with lenalidomide and dexamethasone as a treatment for patients newly diagnosed with multiple myeloma who are not candidates for high-dose chemotherapy and ASCT. The submission was based on data from Phase III MAIA (MMY3008) study.

·

April: A Phase III study was announced to examine daratumumab plus lenalidomide as maintenance treatment in patients with newly diagnosed multiple myeloma and utilizes the subcutaneous formulation of daratumumab. The first patient was dosed in June.

First Quarter Update

·

March: A Phase II study of subcutaneous daratumumab in combination with carfilzomib and dexamethasone (Kd) compared to Kd in patients with relapsed refractory multiple myeloma who were previously treated with intravenous daratumumab was published on www.clinicaltrials.gov.

·

March: Regulatory submissions to broaden the label for daratumumab to include use in combination with VTd as treatment for newly diagnosed patients with multiple myeloma who are candidates for ASCT were submitted to the EMA and the U.S. FDA. The submissions were based on data from the Phase III CASSIOPEIA (MMY3006) study.

·

March: A regulatory submission to broaden the existing marketing authorization for daratumumab to include use in combination with Rd as treatment for newly diagnosed patients with multiple myeloma who are not candidates for high dose chemotherapy and ASCT was submitted to the EMA. The submission was based on data from the Phase III MAIA (MMY3008) study.

·

February: Topline results from the Phase III COLUMBA study (MMY3012) of SubQ versus intravenous (IV) daratumumab for patients with relapsed or refractory multiple myeloma were reported. The results showed that SubQ administration of daratumumab co-formulated with recombinant human hyaluronidase PH20 is non-inferior to IV administration of daratumumab with regard to the co-primary endpoints of overall response rate (ORR) and Maximum Trough concentration (Ctrough) of daratumumab on day 1 of the third treatment cycle. The ORR for patients treated with SubQ daratumumab was 41.1% versus 37.1% in patients treated with IV daratumumab.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 9/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

The lower limit of the 95% Confidence Interval (CI) for the ratio of the two met the specified non-inferiority criterion for this co-primary endpoint. The geometric mean of Ctrough for patients treated with SubQ daratumumab was 499 mg/mL versus 463 mg/mL in patients treated with IV daratumumab. The lower limit of the 95% CI for the ratio of the two met the specified non-inferiority criterion for this co-primary endpoint. No new safety signals were detected and Janssen plans to discuss the potential for a regulatory submission for subcutaneous daratumumab with health authorities.

·

February: The U.S. FDA approved an update to the Prescribing Information for DARZALEX to provide healthcare professionals the option to split the first infusion of DARZALEX over two consecutive days.

·

January:  The first part of a regulatory application was submitted to the FDA for a label expansion to include the use of daratumumab in combination with Rd for the treatment of patients with newly diagnosed multiple myeloma who are not candidates for high dose chemotherapy and ASCT. The submission was based on data from the Phase III MAIA (MMY3008) study. The U.S. FDA reviewed this application under their Real-Time Oncology Review (RTOR) pilot program. The submission was completed in March.

Daratumumab Development Covering All States of Multiple Myeloma – Key Ongoing Trials

Picture 19

Daratumumab Development – Beyond Multiple Myeloma

Picture 1

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

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Page 10/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Arzerra (ofatumumab) – Our First Marketed Product

·

Human CD20 monoclonal antibody developed in collaboration with Novartis

·

Approved in certain territories for certain chronic lymphocytic leukemia (CLL) indications

·

Net sales of Arzerra by Novartis were USD 9 million in the first half of 2019

In the U.S., Arzerra solution for infusion is approved for use in combination with chlorambucil for the treatment of previously untreated patients with CLL for whom fludarabine-based therapy is considered inappropriate; for use in combination with fludarabine and cyclophosphamide (FC) for the treatment of patients with relapsed CLL; and for extended treatment of patients who are in complete or partial response after at least two lines of therapy for recurrent or progressive CLL. It is also indicated as monotherapy for the treatment of patients with CLL who are refractory to fludarabine and alemtuzumab. In 2018, it was announced that Novartis intended to transition Arzerra from commercial availability to limited availability via managed access programs in markets outside the U.S., where applicable and allowed by local regulations.  Accordingly, in 2019, the marketing authorization for Arzerra was withdrawn in the EU and several other territories.  We expect that Arzerra will remain commercially available in Japan as well as in the U.S.

The overall safety profile of Arzerra in CLL is based on exposure in clinical trials and the post-marketing setting. The most common side effects for Arzerra include adverse events associated with infusion reactions, cytopenias, and infections (lower respiratory tract infection, including pneumonia, upper respiratory tract infection, sepsis, including neutropenic sepsis and septic shock, herpes viral infection, and urinary tract infection).

Please consult the full U.S. Prescribing information, including Boxed Warning for all the labeled safety information for Arzerra.

First Quarter Update

February: The marketing authorization for Arzerra was withdrawn in the EU pursuant to Novartis’ decision to transition Arzerra from commercial availability to limited availability in markets outside the U.S. and Japan.

Proprietary Products in Development*

Picture 20

*Certain products in co-development, partners as indicated

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 11/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Tisotumab vedotin – A Next Generation Therapeutic

·

Antibody-drug conjugate (ADC, antibody coupled to a cell-killing agent) in development to treat solid tumors

·

Phase II potential registration study in cervical cancer ongoing, enrollment completed; Phase II clinical studies in ovarian and other solid tumors ongoing

·

Developed under a license and collaboration agreement with Seattle Genetics

Tisotumab vedotin is an ADC targeted to tissue factor (TF), a protein involved in tumor signaling and angiogenesis. Based on its high expression on many solid tumors and its rapid internalization, TF is a suitable target for an ADC approach. Tisotumab vedotin is in clinical development for solid tumors.  Tisotumab vedotin is being co-developed by Genmab and Seattle Genetics, under an agreement in which the companies share all costs and profits for the product on a 50:50 basis.

First Quarter Update

·

March: First patient was dosed in the Phase I/II innovaTV 206 study of tisotumab vedotin as monotherapy for patients in Japan with recurrent and/or metastatic cervical cancer.

·

March: Patient enrollment was completed in the potential registration Phase II innovaTV 204 study of tisotumab vedotin as a monotherapy for patients with recurrent and/or metastatic cervical cancer who have relapsed or progressed after standard of care treatment.

Enapotamab vedotin (HuMax-AXL-ADC) – A First-in-Class ADC

·

ADC in development to treat solid tumors

·

Phase I/II clinical study for multiple types of solid tumors ongoing

Enapotamab vedotin is an ADC targeted to AXL, a signaling molecule expressed on many solid cancers and implicated in tumor biology. Enapotamab vedotin is fully owned by Genmab and the ADC technology used with enapotamab vedotin was licensed from Seattle Genetics. A Phase I/II clinical study of enapotamab vedotin for multiple types of solid tumors is ongoing.

HexaBody-DR5/DR5  (GEN1029) – First HexaBody Program in Clinical Development

·

Proprietary antibody therapeutic created with Genmab’s HexaBody technology

·

Composed of two non-competing HexaBody antibody molecules that target two distinct DR5 epitopes

·

Phase I/II clinical trial in solid tumors ongoing

HexaBody-DR5/DR5 is a product comprising a mixture of two non-competing HexaBody molecules that target two distinct epitopes on death receptor 5 (DR5), a cell surface receptor that mediates a process called programmed cell death. Increased expression of DR5 has been reported in several types of tumors. A Phase I/II clinical trial in solid tumors is ongoing.

DuoBody-CD3xCD20 (GEN3013) – A Proprietary Bispecific Antibody

·

Proprietary bispecific antibody created with Genmab’s DuoBody technology

·

Phase I/II clinical trial in B-cell malignancies ongoing

DuoBody-CD3xCD20 is a proprietary bispecific antibody created using Genmab’s DuoBody technology. DuoBody-CD3xCD20 targets CD3, which is expressed on T-cells, and CD20, a clinically well-validated target. A Phase I/II clinical study of DuoBody-CD3xCD20 in B-cell malignancies is ongoing.

DuoBody-PD-L1x4-1BB (GEN1046) – Potential in Solid Tumors

·

Bispecific antibody created with Genmab’s DuoBody technology

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 12/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

·

Phase I/II clinical trial in solid tumors ongoing

·

Developed in collaboration with BioNTech

DuoBody-PD-L1x4-1BB is a proprietary bispecific antibody, jointly owned by Genmab and BioNTech, created using Genmab’s DuoBody technology. It is being co-developed by Genmab and BioNTech under an agreement in which the companies share all future costs and profits for the product on a 50:50 basis. DuoBody-PD-L1x4-1BB targets PD-L1 and 4-1BB, selected to block inhibitory PD-1 / PD-L1 axis and simultaneously activate essential co-stimulatory activity via 4-1BB using inert DuoBody antibody format. Phase I/II clinical study of DuoBody-PD-L1x4-1BB in solid tumors is ongoing.

Second Quarter Update

·

May: First patient dosed in first-in-human Phase I/II trial of DuoBody-PD-L1x4-1BB in solid tumors.

First Quarter Update

·

January: A CTA for DuoBody-PD-L1x4-1BB was submitted to regulatory authorities in Spain.

DuoBody-CD40x4-1BB (GEN1042) – Potential in Solid Tumors

·

Bispecific antibody created with Genmab’s DuoBody technology

·

First clinical Trial Application (CTA) submitted in March 2019

·

Developed in collaboration with BioNTech

DuoBody-CD40x4-1BB is a proprietary bispecific antibody, jointly owned by Genmab and BioNTech, created using Genmab’s DuoBody technology. It is being co-developed by Genmab and BioNTech under an agreement in which the companies share all future costs and profits for the product on a 50:50 basis. CD40 and 4-1BB were selected as targets to enhance both dendritic cells (DC) and antigen-dependent T-cell activation, using an inert DuoBody format. A Phase I/II clinical study of DuoBody-CD40 x4-1BB in solid tumors is expected to begin in 2019.

First Quarter Update

·

March: A Clinical Trial Application (CTA) for DuoBody-CD40x4-1BB was submitted to regulatory authorities in the UK.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 13/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Partner Programs Built on Genmab’s Innovation

Picture 21

Ofatumumab (OMB157)

·

Human CD20 monoclonal antibody developed in collaboration with Novartis

·

Subcutaneous formulation in development to treat relapsing multiple sclerosis

·

Recruitment completed in two Phase III studies with low dose subcutaneous ofatumumab in relapsing multiple sclerosis

Ofatumumab is a human IgG1k mAb that targets an epitope on the CD20 molecule encompassing parts of the small and large extracellular loops. A subcutaneous formulation of ofatumumab is being investigated in two Phase III clinical studies in relapsing multiple sclerosis (relapsing MS). The studies compare the efficacy and safety of subcutaneous ofatumumab versus teriflunomide in patients with relapsing MS and are comprised of approximately 900 patients each.  A Phase III study examining the long-term safety, tolerability and effectiveness of ofatumumab in patients with relapsing MS who participated in a previous study is also ongoing.

Teprotumumab

·

In clinical development by Horizon Pharma, plc

·

In Phase III development for active thyroid eye disease

Teprotumumab is a human antibody that targets the Insulin-like Growth Factor‑1 Receptor (IGF‑1R), which is a well-validated target. Teprotumumab was created by Genmab under our collaboration with Roche. Clinical

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 14/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

development of teprotumumab is being conducted by Horizon Pharma plc under a license from Roche. Teprotumumab has been granted Fast Track designation, Orphan Drug designation and Breakthrough Therapy Designation for thyroid eye disease, also known as Graves’ orbitopathy by the U.S. FDA.

First Quarter Update

·

February:  Topline results from the Phase III confirmatory trial evaluating teprotumumab for the treatment of active thyroid eye disease showed that the study met its primary endpoint. Horizon Pharma expects to submit a BLA to the U.S. FDA in mid‑2019.

JNJ-61186372

·

DuoBody product targeting EGFR and cMet

·

Phase I study ongoing in non-small cell lung cancer (NSCLC)

·

Developed by Janssen under the DuoBody technology collaboration

JNJ-61186372 is a bispecific antibody that targets EGFR and cMet, two validated cancer targets. JNJ-61186372 was created under a collaboration between Genmab and Janssen using Genmab’s DuoBody technology. The two antibodies used to generate JNJ-61186372 were both created by Genmab. Janssen is investigating JNJ-61186372 in a Phase I clinical study to treat NSCLC.

Second Quarter Update

·

June: Updated data from the Phase I study of JNJ-61186372 in NSCLC was presented in an oral session at the 2019 ASCO Annual Meeting.

JNJ-67571244

·

DuoBody product targeting CD33 and CD3

·

In Phase I study for relapsed or refractory acute myeloid leukemia (AML) or myelodysplastic syndrome (MDS)

·

Developed by Janssen under the DuoBody technology collaboration

JNJ-67571244 is a bispecific antibody that targets CD3, which is expressed on T-cells and CD33, which is frequently expressed in AML and MDS. JNJ-67571244 was created under a collaboration between Genmab and Janssen using Genmab’s DuoBody technology. JNJ-67571244 is being investigated in a Phase I clinical study to treat relapsed or refractory AML or MDS.

Second Quarter Update

·

May: A Phase I study of JNJ-67571244 in relapsed or refractory AML or MDS was initiated.

JNJ-63898081

·

DuoBody product targeting PSMA and CD3

·

In Phase I study for advanced solid tumors

·

Developed by Janssen under the DuoBody technology collaboration

JNJ-63898081 is a bispecific antibody that targets CD3, which is expressed on T-cells and prostate-specific membrane antigen (PSMA) is highly expressed on prostate adenocarcinomas. JNJ-63898081 was created under a collaboration between Genmab and Janssen using Genmab’s DuoBody technology. JNJ-63898081 is being investigated in a Phase I clinical study to treat advanced solid tumors.

Second Quarter Update

·

April: A Phase I study of JNJ-63898081 in advanced solid tumors was published on www.clinicaltrials.gov.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 15/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Pre-clinical Programs

·

Broad pre-clinical pipeline of approximately 20 programs including DuoHexaBody®-CD37

·

Pre-clinical pipeline includes both partnered products and in-house programs based on our proprietary technologies

·

Multiple new Investigational New Drug Applications (INDs) expected to be submitted over coming years

·

Entered strategic collaboration with Immatics to discover and develop next-generation bispecific cancer immunotherapies

·

Entered exclusive worldwide license and option agreement with Janssen to develop and commercialize next-generation CD38 antibody product, HexaBody-CD38

Genmab has approximately 20 active in-house and partnered pre-clinical programs. Our pre-clinical pipeline includes naked antibodies, immune effector function enhanced antibodies developed with our HexaBody technology, and bispecific antibodies created with our DuoBody platform. A number of the pre-clinical programs are carried out in cooperation with our collaboration partners.

Second Quarter Update

·

June: Entered into exclusive worldwide license and option agreement with Janssen to develop and commercialize HexaBody-CD38, a next-generation human CD38 monoclonal antibody product incorporating Genmab’s HexaBody technology. Genmab will fund research and development activities until completion of clinical proof of concept studies in multiple myeloma and diffuse large B-cell lymphoma. Based on the data from these studies, Janssen may exercise its option and receive a worldwide license to develop, manufacture and commercialize HexaBody-CD38. Should this occur, Janssen will pay Genmab a USD 150 million option exercise fee and up to USD 125 million in development milestones, as well as a flat royalty rate of 20% on sales of HexaBody-CD38 until a specified time in 2031, followed by 13-20% tiered royalties on sales thereafter. Should Janssen not exercise its option, the terms of the agreement allow Genmab to continue to develop and commercialize HexaBody-CD38 for DARZALEX-resistant patients, and in all other indications except those multiple myeloma or amyloidosis indications where DARZALEX is either approved or is being actively developed.

The agreement is the outcome of pre-clinical research on novel CD38 targeting concepts conducted by Genmab. HexaBody-CD38 showed encouraging in vitro complement-dependent cytotoxicity (CDC) activity in B-cell lymphoma and leukemia, including for cells with low CD38 expression levels. HexaBody-CD38 also showed similar antibody-dependent cellular cytotoxicity (ADCC) in vitro compared to daratumumab.

SIGNIFICANT RISKS AND UNCERTAINTIES

As a biotech company, Genmab faces a number of risks and uncertainties. These are common for the industry and relate to operations, research and development, commercial and financial activities. For further information about risks and uncertainties which the Genmab group faces, refer to the 2018 annual report and the final prospectus for our U.S. public offering and listing, filed with the U.S. Securities and Exchange Commission (SEC) in July of 2019. At the date of this interim report, there have been no significant changes to Genmab’s overall risk profile since the publication of the 2018 annual report.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 16/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

FINANCIAL REVIEW

The interim report is prepared on a consolidated basis for the Genmab group. The financial statements are published in Danish Kroner (DKK).

Revenue

Genmab’s  revenue was DKK 1,365 million for the first half of 2019 compared to DKK 1,191 million for the first half of 2018. The increase of DKK 174 million, or 15%, was mainly driven by higher DARZALEX royalties and reimbursement income from our collaborations with Seattle Genetics and BioNTech, partly offset by the one-time payment from Novartis of USD 50 million (DKK 304 million) during the first half of 2018.

 

 

 

 

 

 

MDKK

    

H1 2019

    

H1 2018

Royalties

 

1,181

 

709

Milestone payments

 

20

 

40

License fees

 

 —

 

336

Reimbursement income

 

164

 

106

Total revenue

 

1,365

 

1,191

 

Royalties

Royalty income amounted to DKK 1,181 million in the first half of 2019 compared to DKK 709 million in the first half of 2018. The increase of DKK 472 million, or 67%, was driven by higher DARZALEX royalties, which were partly offset by lower Arzerra royalties.

Net sales of DARZALEX by Janssen were USD 1,403 million in the first half of 2019 compared to USD 943 million in the first half of 2018. The increase of USD 460 million, or 49%, was driven by the continued strong uptake following the regulatory approvals in the U.S., EU and Japan. According to Johnson & Johnson, sales in the second quarter of 2019 included a one-time adjustment outside the U.S. related to the completion of pricing and reimbursement discussions in certain European countries, which positively impacted this worldwide second quarter operational growth by 16 percentage points. Royalty income on net sales of DARZALEX was DKK 1,169 million in the first half of 2019 compared to DKK 695 million in the first half of 2018, an increase of DKK 474 million. The increase in royalties of 68% is higher than the increase in the underlying sales due primarily to currency fluctuations between the USD and DKK.

Novartis’ net sales of Arzerra were USD 9 million in the first half of 2019 compared to USD 11 million in the first half of 2018, a decrease of USD 2 million, or 18%. Royalty income on net sales of Arzerra was DKK 12 million in the first half of 2019 compared to DKK 14 million in the first half of 2018, a decrease of DKK 2 million, or 14%.

Milestone Payments

Milestone income was DKK 20 million in the first half of 2019 which was driven by payment from Janssen for an additional DuoBody target pair under the license and collaboration agreement. Milestone income was DKK 40 million in the first half of 2018 which was driven by the Janssen and Novo Nordisk DuoBody collaborations. Milestone income may fluctuate significantly from period to period due to both the timing of achievements and the varying amount of each individual milestone under our license and collaboration agreements.

Licenses Fees

There was no license fee income during the first half of 2019. License fee income was DKK 336 million during the first half of 2018 which was driven by the USD 50 million upfront payment from Novartis with the amendment of the Arzerra/ofatumumab license and collaboration agreement, payment from Janssen for an additional DuoBody target pair under the license agreement and the payment from Novo Nordisk for extending exclusivity of the commercial license for a DuoBody target pair under the agreement.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 17/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Reimbursement Income

Reimbursement income amounted to DKK 164 million in the first half of 2019 compared to DKK 106 million in the first half of 2018. The increase of DKK 58 million was driven by increased activities under our collaboration agreements with Seattle Genetics and BioNTech.

Refer to note 2 in this interim report for further details about revenue.

Research and Development Costs

Research and development costs amounted to DKK 1,110 million in the first half of 2019 compared to DKK 632 million in the first half of 2018. The increase of DKK 478 million, or 76%, was driven by the advancement of enapotamab vedotin and tisotumab vedotin, the additional investment in our product pipeline, and the increase in research and development employees.

Research and development costs accounted for 89% of the total operating expenses in the first half of 2019 compared to 86% in the first have of 2018.

General and Administrative Expenses

General and administrative expenses were DKK 144 million in the first half of 2019 compared to DKK 100 million in the first half of 2018. The increase of DKK 44 million, or 44%, was driven by growth across all support areas including enhanced technology and systems, early investment in commercial, and others due to the expansion of our product pipeline.

General and administrative expenses accounted for 11% of the total operating expenses in the first half of 2019 compared to 14% in the first have of 2018.

Operating Result

Operating income was DKK 111 million in the first half of 2019 compared to DKK 459 million in the first half of 2018. As anticipated, the decrease of DKK 348 million, or 76%, was driven primarily by increased operating expenses and the one-time payment from Novartis in 2018.

As of June 30, 2019, the total number of employees was 478 compared to 309 employees as of June 30, 2018. The increase in employees was driven by the expansion of our pipeline.

 

 

 

 

 

 

Workforce

    

June 30, 2019

    

June 30, 2018

Research and development employees

 

406

 

263

Administrative employees

 

72

 

46

Total employees

 

478

 

309

 

Net Financial Items

The net financial items for the first half of 2019 were net income of DKK 93 million compared to net income of DKK 132 million in the first half of 2018. The decrease of DKK 39 million, or 30%, was driven primarily by foreign exchange movements between the USD and DKK. During the first half of 2019, the USD strengthened against the DKK to a lesser extent than 2018, resulting in lower realized and unrealized exchange rate gains. Refer to note 4 in this interim report for further details about the net financial items.

Corporate Tax

The corporate tax expense for the first half of 2019 was DKK 47 million compared to DKK 132 million for the first half of 2018. The estimated annual effective corporate tax rate in the first half of 2019 was 23% compared to 22% in the first half of 2018. There has been no reversal of the valuation allowances on deferred tax assets in the first half of 2019 or the first half of 2018.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 18/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Net Result

Net result for the first half of 2019 was a net income of DKK 157 million compared to DKK 459 million in the first half of 2018. The decrease was driven by the items described above.

Cash Position

 

 

 

 

 

 

Cash Position (MDKK)

    

June 30, 2019

    

December 31, 2018

Marketable securities

 

6,368

 

5,573

Cash and cash equivalents

 

583

 

533

Cash position

 

6,951

 

6,106

 

As of June 30, 2019, cash, cash equivalents, and marketable securities (cash position) amounted to DKK 6,951 million, an increase of DKK 845 million from the beginning of 2019. The increase was mainly driven by positive working capital adjustments of DKK 700 million related to milestones achieved in the fourth half of 2018 which were received in the first half of 2019, and our operating income of DKK 111 million, which were partly offset by corporate taxes paid of DKK 140 million during the first half of 2019.

There were no short-term marketable securities included in cash and cash equivalents at the end of June 2019 or at the end December 2018. In accordance with our accounting policy, securities purchased with a maturity of less than three months at the date of acquisition are classified as cash and cash equivalents. Refer to note 3 in this interim report for further details about our marketable securities.

Cash Flow

 

 

 

 

 

 

Cash Flow (MDKK)

    

H1 2019

    

H1 2018

Cash provided by (used in) operating activities

 

832

 

599

Cash provided by (used in) investing activities

 

(786)

 

(787)

Cash provided by (used in) financing activities

 

16

 

(86)

 

Net cash provided by operating activities is primarily related to our operating result, working capital fluctuations, reversal of net financial items, and adjustments related to non-cash expenses, all of which may be highly variable period to period. In the first half of 2019, the primary driver of higher cash provided by operating activities was higher positive working capital adjustments in 2019 related to milestones achieved in the fourth half of 2018 that were received in 2019.

The change in cash used in investing activities primarily reflects differences between the proceeds received from sale and maturity of our investments and amounts invested. Purchases of marketable securities exceeded sales and maturities in the first half of 2019 and 2018.

Net cash used in financing activities is primarily related to the purchase of treasury shares, exercise of warrants and lease payments. In the first half of 2019, the primary driver of the lower cash used in financing activities was related to the purchase of treasury shares during the first half of 2018 of DKK 146 million. There were no purchases of treasury shares during the first half of 2019.

Balance Sheet

As of June 30, 2019, total assets were DKK 8,977 million compared to DKK 8,461 million as of December 31, 2018. As of June 30, 2019, assets are mainly comprised of a cash position of DKK 6,951 million and receivables of DKK 871 million. The receivables consist primarily of royalties from our license and collaboration agreements and non-interest bearing receivables, which are due less than one year from the balance sheet date.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 19/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

Shareholders’ equity as of June 30, 2019 was DKK 8,287 million compared to DKK 8,014 million at the end of December 2018. The increase was driven primarily by our net income. As of June 30, 2019, Genmab’s equity ratio was 92% compared to 95% as of December 31, 2018.

Legal Matter – MorphoSys Patent Infringement Complaint

On January 25, 2019, the District Court ruled on summary judgment that the three MorphoSys patents were invalid for lack of enablement.  MorphoSys had the opportunity to appeal the District Court’s decision. In addition, a further claim by Janssen and us that the three MorphoSys patents were unenforceable due to inequitable conduct by MorphoSys was included in the case. On January 31, 2019, MorphoSys dismissed its infringement claims against us and Janssen with prejudice, and we and Janssen, in turn, dismissed our inequitable conduct claims against MorphoSys.  As such, there will be no further proceedings in the case.

General Corporate Matter – Initial Public Offering of ADSs in the U.S. and Capital Increase

On May 28, 2019, Genmab filed a registration statement with the U.S. Securities and Exchange Commission for a proposed initial public offering of ADSs and applied for listing of the ADSs on the Nasdaq Global Select Market.  Genmab commenced the initial public offering of ADSs on July 9, 2019 and priced the offering on July 17, 2019.

On July 22, 2019, the public offering and listing of American Depository Shares (ADSs) on Nasdaq Global Select Market under the symbol “GMAB” was completed. Gross proceeds from the issuance of new shares amounted to USD 506 million (DKK 3,368 million) with a corresponding increase in share capital of 2,850,000 ordinary shares or 28,500,000 American Depository Shares (“ADSs”). Further, the underwriters’ exercised in full their option to purchase an additional 427,500 ordinary shares or 4,275,000 ADSs bringing the total gross proceeds of the offering to USD 582 million (DKK 3,873 million). The closing of the overallotment was completed on July 23, 2019. The public offering price of $17.75 per ADS, corresponded to a subscription price of DKK 1,181.80 per New Share at the U.S. dollar/DKK exchange rate of DKK 6.6580 per USD 1.00 on July 17, 2019, multiplied by the ADS-to-share ratio of ten-to-one. Underwriting commissions paid were USD 32 million (DKK 213 million). Total share capital following the public offering amounted to DKK 64,967,643.

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 20/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

STATEMENT OF COMPREHENSIVE INCOME FOR THE 2ND QUARTER OF 2019

Income Statement

 

 

 

 

 

 

 

    

2nd Quarter of

    

2nd Quarter of

 

 

2019

 

2018

 

 

DKK'000

 

DKK'000

 

 

 

 

 

Revenue

 

773,914

 

509,675

 

 

 

 

 

Research and development expenses

 

(563,376)

 

(318,889)

General and administrative expenses

 

(73,371)

 

(55,742)

Operating expenses

 

(636,747)

 

(374,631)

 

 

 

 

 

Operating result

 

137,167

 

135,044

 

 

 

 

 

Net financial items

 

(26,639)

 

200,271

 

 

 

 

 

Net result before tax

 

110,528

 

335,315

 

 

 

 

 

Corporate tax

 

(25,643)

 

(74,788)

 

 

 

 

 

Net result

 

84,885

 

260,527

 

 

 

 

 

Basic net result per share

 

1.38

 

4.26

Diluted net result per share

 

1.35

 

4.21

 

 

 

 

 

Statement of Comprehensive Income

 

  

 

  

 

 

 

 

 

Net result

 

84,885

 

260,527

 

 

 

 

 

Other comprehensive income:

 

  

 

  

 

 

 

 

 

Amounts which will be re-classified to the income statement:

 

  

 

  

Adjustment of foreign currency fluctuations on subsidiaries

 

36

 

10,335

 

 

 

 

 

Total comprehensive income

 

84,921

 

270,862

 

 

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 21/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

STATEMENT OF COMPREHENSIVE INCOME FOR THE FIRST HALF OF 2019

Income Statement

 

 

 

 

 

 

 

 

 

    

 

    

6 Months Ended

    

6 Months Ended

 

 

Note

 

June 30, 2019

 

June 30, 2018

 

 

 

 

DKK'000

 

DKK'000

 

 

 

 

 

 

 

Revenue

 

2

 

1,364,923

 

1,190,687

 

 

 

 

 

 

 

Research and development expenses

 

 

 

(1,109,456)

 

(631,440)

General and administrative expenses

 

 

 

(144,224)

 

(100,158)

Operating expenses

 

 

 

(1,253,680)

 

(731,598)

 

 

 

 

 

 

 

Operating result

 

 

 

111,243

 

459,089

 

 

 

 

 

 

 

Net financial items

 

4

 

93,307

 

131,791

 

 

 

 

 

 

 

Net result before tax

 

 

 

204,550

 

590,880

 

 

 

 

 

 

 

Corporate tax

 

 

 

(47,456)

 

(131,779)

 

 

 

 

 

 

 

Net result

 

 

 

157,094

 

459,101

 

 

 

 

 

 

 

Basic net result per share

 

 

 

2.56

 

7.51

Diluted net result per share

 

 

 

2.53

 

7.41

 

 

 

 

 

 

 

Statement of Comprehensive Income

 

 

 

  

 

   

 

 

 

 

 

 

 

Net result

 

 

 

157,094

 

459,101

 

 

 

 

 

 

 

Other comprehensive income:

 

  

 

 

 

   

 

 

 

 

 

 

 

Amounts which will be re-classified to the income

 

  

 

 

 

   

Adjustment of foreign currency fluctuations on subsidiaries

 

 

 

4,003

 

5,444

 

 

 

 

 

 

 

Total comprehensive income

 

 

 

161,097

 

464,545

 

 

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 22/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

BALANCE SHEET

 

 

 

 

 

 

 

 

 

    

 

    

June 30, 

    

December 31, 

 

 

Note

 

2019

 

2018

 

 

 

 

DKK'000

 

DKK'000

ASSETS

 

  

 

  

 

  

 

 

 

 

 

 

 

Intangible assets

 

  

 

421,429

 

470,359

Property, plant and equipment

 

  

 

175,948

 

161,545

Right-of-use assets

 

7

 

190,979

 

 —

Receivables

 

  

 

11,533

 

9,621

Deferred tax assets

 

  

 

366,560

 

386,449

 

 

 

 

 

 

 

Total non-current assets

 

  

 

1,166,449

 

1,027,974

 

 

 

 

 

 

 

Receivables

 

  

 

859,911

 

1,326,931

Marketable securities

 

3

 

6,368,090

 

5,573,187

Cash and cash equivalents

 

  

 

582,863

 

532,907

 

 

 

 

 

 

 

Total current assets

 

  

 

7,810,864

 

7,433,025

 

 

 

 

 

 

 

Total assets

 

  

 

8,977,313

 

8,460,999

 

 

 

 

 

 

 

SHAREHOLDERS’ EQUITY AND LIABILITIES

 

  

 

  

 

  

 

 

 

 

 

 

 

Share capital

 

  

 

61,690

 

61,498

Share premium

 

  

 

8,097,093

 

8,058,614

Other reserves

 

  

 

95,710

 

91,707

Retained Earnings

 

  

 

32,016

 

(197,459)

 

 

 

 

 

 

 

Shareholders' equity

 

  

 

8,286,509

 

8,014,360

 

 

 

 

 

 

 

Provisions

 

  

 

1,860

 

1,430

Lease liabilities

 

7

 

162,811

 

 —

Other payables

 

  

 

1,575

 

1,860

 

 

 

 

 

 

 

Total non-current liabilities

 

  

 

166,246

 

3,290

 

 

 

 

 

 

 

Corporate tax payable

 

  

 

1,583

 

126,964

Lease liabilities

 

7

 

31,237

 

 —

Other payables

 

  

 

491,738

 

316,385

 

 

 

 

 

 

 

Total current liabilities

 

  

 

524,558

 

443,349

 

 

 

 

 

 

 

Total liabilities

 

  

 

690,804

 

446,639

 

 

 

 

 

 

 

Total shareholders' equity and liabilities

 

  

 

8,977,313

 

8,460,999

 

 

 

 

 

 

 

Share-based instruments

 

5

 

  

 

  

Shareholdings by the Board of Directors and Executive Management

 

6

 

  

 

  

Subsequent events to the balance sheet date

 

8

 

  

 

  

 

 

 

 

 

Genmab A/S

Tel: +45 7020 2728

Company Announcement no. 40

Kalvebod Brygge 43

Fax: +45 7020 2729

Page 23/40

1560 Copenhagen V, Denmark

www.genmab.com

CVR no. 2102 3884

 

Picture 4

Interim Report for the First Half of 2019

STATEMENT OF CASH FLOWS

 

 

 

 

 

 

 

 

 

 

 

 

6 Months Ended

 

6 Months Ended

 

    

Note

    

June 30, 2019

    

June 30, 2018

 

 

 

 

DKK'000

 

DKK'000

 

 

 

 

 

 

 

Net result before tax

 

 

 

204,550

 

590,880

 

 

 

 

 

 

 

Reversal of financial items, net