EQS-News: Formycon AG informs about recent developments in various biosimilar projects and invites to conference call

Press Release // February 17, 2025

Formycon AG informs about recent developments in various biosimilar projects and invites to conference call
 

• Formycon continues FYB206 development without Phase III trial and thus takes pioneering role among pembrolizumab biosimilar developers; investment savings expected to amount to a high double-digit million figure, significantly strengthening working capital over the next few years
• New assumptions for expected product sales in the US likely to require adjustment of the FYB202/Otulfi™¹ valuation model and non-cash impairment in fiscal year 2024
• Discussions with commercialization partner Sandoz AG initiated to evaluate the future U.S. commercialization strategy for FYB201/CIMERLI^®2 in light of increasing price discounts
• Existing guidance for key financial figures for the 2024 fiscal year will presumably remain unaffected; achieving EBITDA and operating cash flow profitability remains mid-term objective

Planegg-Martinsried, Germany - Formycon AG (FSE: FYB, Prime Standard) (“Formycon” or “the Company”) today provided an update on key developments across various biosimilar projects and invites participants to an extraordinary conference call on February 17, 2025, at 5:00 p.m. CET to share further details regarding these recent events.

FYB206 – biosimilar to Keytruda^{®3(pembrolizumab)}

Based on intensive scientific dialogue with the U.S. Food and Drug Administration (FDA) regarding the clinical development programme, the Executive Board of Formycon has today decided to terminate the phase III trial (“Lotus”) for the biosimilar candidate FYB206 ahead of schedule. After careful consideration, the Executive Board has concluded that the continuation of the trial is no longer necessary for the development and approval of FYB206 in the U.S. The therapeutic comparability of FYB206 with the reference drug Keytruda® can be sufficiently demonstrated based on the comprehensive analytical data and the data from the parallel phase I trial (“Dahlia”) in patients with malignant melanoma (black skin cancer). Formycon is thus taking a pioneering role among pembrolizumab biosimilar developers, once again highlighting its expertise in the development of biosimilars. Patients with non-small cell lung cancer (NSCLC) who have been treated in the phase III trial so far will continue to be given the reference drug Keytruda^®.

As a result of the early termination of the extensive phase III trial, the company expects probable investment savings in the high double-digit millions over the next few years. As the development costs for FYB206 have been capitalised on the balance sheet since 2022, future savings will not affect the income statement but will have a direct positive impact on liquidity. Accordingly, the company expects significantly positive effects in the high double-digit million range for the cash flow statement and working capital.

FYB202/Otulfi^TM – biosimilar to Stelara^®4 (ustekinumab)

In consultation with its commercialization partner Fresenius Kabi AG in the context of the imminent market launch of FYB202/Otulfi^TM in the U.S., Formycon assumes that the valuation model and the balance sheet measurement for FYB202 will need to be reviewed and adjusted accordingly due to an emerging, significantly higher-than-expected price discount for biosimilars in the U.S. In 2022, FYB202 was acquired by the Company through a contribution in kind as part of the Athos transaction and approved in 2024 in the U.S. and Europe in various immunological indications. According to preliminary calculations, Formycon currently expects a non-cash impairment in the high double-digit to almost low triple-digit million range. The exact figures are currently being calculated and audited by the company as part of the year-end financial audit.

FYB201/CIMERLI^® – biosimilar to Lucentis^®5 (ranibizumab)

Due to the increasing price discount offered by ranibizumab providers in the US, Bioeq AG, the exclusive license holder of FYB201/CIMERLI^®, is currently in discussions with its commercialization partner Sandoz AG regarding the further commercialization strategy for FYB201/CIMERLI^® in the U.S. Based on the status of these discussions, the company currently assumes that the commercialization of FYB201/CIMERLI^® will likely be temporarily paused. As a result, this is expected to lead to an extraordinary adjustment of the valuation model and the balance sheet measurement for FYB201 as well as the stake in Bioeq AG, amounting to a high single-digit to low double-digit million figure for the 2024 financial year. In this context, Bioeq AG is evaluating alternative commercialization strategies for the ophthalmic biosimilar in the U.S. Formycon will provide updates on further developments in due course.

The Company currently assumes that the key financial performance indicators (Group revenue and EBITDA, adjusted Group EBITDA and working capital) for the 2024 financial year should not be affected by these adjustments. However, the company's net result could be negatively affected by the impairment.

Dr Stefan Glombitza, CEO of Formycon AG, commented: “The latest developments in our projects underscore both the dynamics and the opportunities of the market environment. For biosimilars in the so-called Pharma Benefit market segment in the US, it is becoming apparent that the market opening for biosimilars is still progressing slower and requires greater price discounts than previously anticipated. This will also affect our product FYB202/Otulfi^TM, which is marketed by our partner Fresenius Kabi. In the case of FYB201/CIMERLI^®, our partner Sandoz is observing increasing price discounts in the U.S. and has informed us of planned adjustments to the marketing strategy. Bioeq AG is therefore examining options for alternative commercialization strategies for the U.S. that combine economic success with long-term market presence. Biosimilars have already amply demonstrated that they can achieve a sustainable market position in the long term and are based on a profitable business model. Our strategy remains focused on working with our partners to achieve a leading position in this dynamic environment.

At the same time, regulatory developments in the U.S. indicate that the framework conditions for biosimilars continue to improve. The FDA has confirmed that extensive analytical data, together with the ongoing phase I trial, will be sufficient to demonstrate the therapeutic comparability of our biosimilar candidate FYB206 with Keytruda^®. This eliminates the need for a phase III trial for FYB206 – an important step that will not only shorten the development time but also significantly reduce investment. This also highlights the importance of the quality of our analytical and preclinical data. Formycon is thus taking on a pioneering and leading role among Keytruda^® biosimilar developers.”

Enno Spillner, CFO of Formycon AG, added: “We expect the financial adjustments in our three projects to have differing effects. The consideration of the price discounts for FYB202 will require a review of our assumptions and financial models. This could lead to significant valuation adjustments for FYB202. In addition, the temporally pause in the marketing of FYB201 would require an adjustment to our short-term planning. Therefore, we are currently analyzing the potential impact and the specific impairment requirements. Meanwhile, the decision on FYB206, based on feedback from the FDA, brings us significant financial benefits. By ending the phase III trial early, we expect savings in the high double-digit million range over the next few years. This strengthens our working capital, creates additional financial flexibility for the further development of our pipeline and could partially compensate for lower cash flows from FYB201 and FYB202. We will provide guidance for the 2025 financial year when publishing the 2024 annual financial statements. In general, our goal of achieving profitability and positive operating cash flow in the medium term remains unchanged.”

Conference call and webcast

The Executive Board of Formycon AG will discuss and provide context for the company's latest developments in a conference call. The conference call, which will be webcast live, will be held in English on February 17, 2025, at 5:00 p.m. (CET).

To participate in the conference call, please register at: https://webcast.meetyoo.de/reg/X9bNqTxsvSRH

After registration, participants will receive a confirmation email with individual dial-in details and the date.

The presentation and audio broadcast can be accessed via the following webcast link: https://www.webcast-eqs.com/formycon-2025-02

After a short presentation, the Executive Board will be available to answer analysts' questions. The webcast will be recorded and will be available for viewing afterwards on the Formycon website at: https://www.formycon.com/news-media/blog/.

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1) Otulfi^TM is a trademark of Fresenius Kabi Deutschland GmbH in selected countries
2) CIMERLI^® is a registered trademark of Coherus BioSciences, Inc.
3) Keytruda^® is a registered trademark of Merck Sharp & Dohme LLC, a subsidiary of Merck & Co, Inc, Rahway, NJ/USA
4) Stelara^® is a registered trademark of Johnson & Johnson
5) Lucentis® is a registered trademark of Genentech, Inc.

About Formycon:
Formycon AG (FSE: FYB) is a leading, independent developer of high-quality biosimilars, follow-on products of biopharmaceutical medicines. The company focuses on therapies in ophthalmology, immunology, immuno-oncology and other key disease areas, covering almost the entire value chain from technical development through clinical trials to approval by the regulatory authorities. For commercialization of its biosimilars, Formycon relies on strong, well-trusted and long-term partnerships worldwide. With FYB201/ranibizumab, Formycon already has a biosimilar on the market in Europe, the USA, Canada and parts of the MENA region. Two further biosimilars, FYB202/ustekinumab and FYB203/aflibercept, received US and EU approval; FYB202 is also approved in Canada and the UK. Another four biosimilar candidates are currently in development. With its biosimilars, Formycon is making an important contribution to providing as many patients as possible with access to highly effective and affordable medicines.

Formycon AG is headquartered in Munich, listed in the Prime Standard of the Frankfurt Stock Exchange: FYB / ISIN: DE000A1EWVY8 / WKN: A1EWVY and is part of the SDAX and TecDax selection indices. Further information can be found at: https://www.formycon.com/

About Biosimilars:
Since their introduction in the 1980s, biopharmaceutical drugs have revolutionized the treatment of serious and chronic diseases. By 2032, many of these drugs will lose their patent protection – including 45 blockbusters with an estimated total annual global turnover of more than 200 billion US dollars. Biosimilars are successor products to biopharmaceutical drugs for which market exclusivity has expired. They are approved in highly regulated markets such as the EU, the USA, Canada, Japan and Australia in accordance with strict regulatory procedures. Biosimilars create competition and thus give more patients access to biopharmaceutical therapies. At the same time, they reduce costs for healthcare systems. Global sales of biosimilars currently amount to around 21 billion US dollars. Analysts assume that sales could rise to over 74 billion US dollars by 2030.

Contact:
Sabrina Müller,
Director Investor Relations & Corporate Communications,
Formycon AG
Fraunhoferstr. 15
82152 Planegg-Martinsried
Germany

Tel.: +49 (0) 89 - 86 46 67 149
Fax: + 49 (0) 89 - 86 46 67 110
Mail: Sabrina.Mueller@formycon.com

Disclaimer:
This press release may contain forward-looking statements and information which are based on Formycon’s current expectations and certain assumptions. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, performance of the company, development of the products and the estimates given here. Such known and unknown risks and uncertainties comprise, among others, the research and development, the regulatory approval process, the timing of the actions of regulatory bodies and other governmental authorities, clinical results, changes in laws and regulations, product quality, patient safety, patent litigation, contractual risks and dependencies from third parties. With respect to pipeline products, Formycon AG does not provide any representation, warranties or any other guarantees that the products will receive the necessary regulatory approvals or that they will prove to be commercially exploitable and/or successful. Formycon AG assumes no obligation to update these forward-looking statements or to correct them in case of developments which differ from those anticipated. This document neither constitutes an offer to sell nor a solicitation of an offer to buy or subscribe for securities of Formycon AG. No public offering of securities of Formycon AG will be made nor is a public offering intended. This document and the information contained therein may not be distributed in or into the United States of America, Canada, Australia, Japan or any other jurisdictions, in which such offer or such solicitation would be prohibited. This document does not constitute an offer for the sale of securities in the United States.