BeOne Medicines Ltd 10-Q for FY2021 Q3

BeOne Medicines Ltd. (ONC)

10-Q 2021-11-04 For: 2021-09-30

Added on April 06, 2026

About this 10-Q

BeOne Medicines Ltd filed this 10-Q on November 4, 2021, covering the quarter ended September 30, 2021 (FY2021 Q3).

Headline figures

Quarter ended September 30, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $206.44M; up 126.7% from $91.08M a year earlier
Net loss: $413.86M; compared with a net loss of $425.22M a year earlier

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Cayman Islands			98-1209416
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

c/o Mourant Governance Services (Cayman) Limited
94 Solaris Avenue, Camana Bay
Grand Cayman
Cayman Islands			KY1-1108
(Address of principal executive offices)			(Zip Code)


		Page

PART I.	FINANCIAL INFORMATION	5

Item 1.	Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	50

Item 4.	Controls and Procedures	51

PART II.	OTHER INFORMATION	52

Item 1.	Legal Proceedings	52

Item 1A.	Risk Factors	52

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	108

Item 3.	Defaults Upon Senior Securities	108

Item 4.	Mine Safety Disclosures	108

Item 5.	Other Information	108

Item 6.	Exhibits	108

SIGNATURES		110


		As of
		September 30,	December 31,
	Note	2021	2020
		$	$
		(unaudited)	(audited)
Assets
Current assets:
Cash and cash equivalents		1,383,310	1,381,950
Short-term restricted cash	4	330	307
Short-term investments	4	2,533,617	3,268,725
Accounts receivable, net	10	129,584	60,403
Inventories	5	150,979	89,293
Prepaid expenses and other current assets	10	235,015	160,012
Total current assets		4,432,835	4,960,690
Long-term restricted cash	4	6,056	7,748
Property, plant and equipment, net	6	450,788	357,686
Operating lease right-of-use assets		100,585	90,581
Intangible assets, net	8	14,104	5,000
Deferred tax assets	9	106,844	65,962
Other non-current assets	10	175,122	113,090
Total non-current assets		853,499	640,067
Total assets		5,286,334	5,600,757
Liabilities and shareholders' equity
Current liabilities:
Accounts payable		206,203	231,957
Accrued expenses and other payables	10	389,874	346,144
Deferred revenue, current portion	3	72,626	—
Tax payable	9	20,878	20,380
Operating lease liabilities, current portion		18,644	13,895
Research and development cost share liability, current portion	3	153,838	127,808
Short-term debt	11	442,372	335,015
Total current liabilities		1,304,435	1,075,199
Non-current liabilities:
Long-term bank loans	11	200,906	183,637
Deferred revenue, non-current portion	3	52,272	—
Operating lease liabilities, non-current portion		37,613	29,417
Deferred tax liabilities	9	13,266	10,792
Research and development cost share liability, non-current portion	3	266,163	375,040
Other long-term liabilities	10	54,606	57,429
Total non-current liabilities		624,826	656,315
Total liabilities		1,929,261	1,731,514
Commitments and contingencies	18
Equity:
Ordinary shares, US$0.0001 par value per share; 9,500,000,000 shares authorized; 1,213,234,201 and 1,190,821,941 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively		121	118
Additional paid-in capital		7,724,822	7,414,932
Accumulated other comprehensive income	15	12,580	6,942
Accumulated deficit		(4,380,450)	(3,552,749)
Total equity		3,357,073	3,869,243
Total liabilities and equity		5,286,334	5,600,757


		Three Months Ended		Nine Months Ended
		September 30,		September 30,
	Note	2021	2020	2021	2020
		$	$	$	$
Revenues
Product revenue, net	12	192,461	91,080	437,202	208,774
Collaboration revenue	3	13,979	—	525,102	—
Total revenues		206,440	91,080	962,304	208,774
Expenses
Cost of sales - product		47,413	21,123	116,361	49,579
Research and development		351,937	349,070	1,028,754	939,340
Selling, general and administrative		269,227	160,837	683,622	391,967
Amortization of intangible assets		188	187	563	658
Total expenses		668,765	531,217	1,829,300	1,381,544
Loss from operations		(462,325)	(440,137)	(866,996)	(1,172,770)
Interest (expense) income, net		(2,230)	(614)	(11,275)	7,184
Other income, net		31,477	5,711	26,487	29,368
Loss before income taxes		(433,078)	(435,040)	(851,784)	(1,136,218)
Income tax benefit	9	(19,223)	(8,423)	(24,083)	(8,344)
Net loss		(413,855)	(426,617)	(827,701)	(1,127,874)
Less: net loss attributable to noncontrolling interests		—	(1,393)	—	(3,713)
Net loss attributable to BeiGene, Ltd.		(413,855)	(425,224)	(827,701)	(1,124,161)

Loss per share attributable to BeiGene, Ltd.		(0.34)	(0.37)	(0.69)	(1.07)


Weighted-average shares outstanding—basic and diluted		1,205,971,284	1,148,973,077	1,196,391,201	1,052,940,583


Loss per American Depositary Share ("ADS")		(4.46)	(4.81)	(8.99)	(13.88)


Weighted-average ADSs outstanding—basic and diluted		92,767,022	88,382,544	92,030,092	80,995,429


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2021	2020	2021	2020
	$	$	$	$
Net loss	(413,855)	(426,617)	(827,701)	(1,127,874)
Other comprehensive (loss) income, net of tax of nil:
Foreign currency translation adjustments	664	10,143	6,528	7,526
Pension liability adjustments	(111)	—	250	—
Unrealized holding (loss) gain, net	(68)	(1,044)	(1,140)	184
Comprehensive loss	(413,370)	(417,518)	(822,063)	(1,120,164)
Less: comprehensive loss attributable to noncontrolling interests	—	(1,174)	—	(3,585)
Comprehensive loss attributable to BeiGene, Ltd.	(413,370)	(416,344)	(822,063)	(1,116,579)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


		Nine Months Ended September 30,
	Note	2021	2020
		$	$
Operating activities:
Net loss		(827,701)	(1,127,874)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		33,336	23,961
Share-based compensation expenses	14	177,701	134,020

Unrealized gains on equity investments	4	(17,166)	(9,974)

Acquired in-process research and development		53,500	89,500
Amortization of research and development cost share liability	3	(82,846)	(85,296)

Deferred income tax benefits		(38,408)	(8,762)
Other items, net		17,719	(10,163)
Changes in operating assets and liabilities:
Accounts receivable		(69,174)	10,497
Inventories		(61,686)	(6,972)
Other assets		(92,938)	(58,921)
Accounts payable		(12,376)	21,979
Accrued expenses and other payables		819	103,600

Deferred revenue		124,898	—
Other liabilities		3,438	(26,722)

Net cash used in operating activities		(790,884)	(951,127)
Investing activities:
Purchases of property, plant and equipment		(147,963)	(82,819)


Purchases of investments		(2,062,879)	(4,879,705)
Proceeds from sale or maturity of investments		2,758,391	1,972,608
Purchase of in-process research and development		(8,500)	(89,500)
Other investing activities		(7,500)	(2,025)
Net cash provided by (used in) investing activities		531,549	(3,081,441)
Financing activities:
Proceeds from sale of ordinary shares, net of cost	16	50,000	4,232,017
Proceeds from research and development cost share liability		—	616,834
Prepayment to acquire joint venture ("JV") minority interest		—	(28,723)
Proceeds from long-term loan	11	16,838	64,288
Repayment of long-term loan		—	(132,061)
Proceeds from short-term loans	11	143,456	48,983
Repayment of short-term loans		(40,229)	—
Proceeds from option exercises and employee share purchase plan		82,192	75,830
Net cash provided by financing activities		252,257	4,877,168
Effect of foreign exchange rate changes, net		6,769	4,340
Net (decrease) increase in cash, cash equivalents, and restricted cash		(309)	848,940
Cash, cash equivalents, and restricted cash at beginning of period		1,390,005	620,775
Cash, cash equivalents, and restricted cash at end of period		1,389,696	1,469,715
Supplemental cash flow information:
Cash and cash equivalents		1,383,310	1,464,470
Short-term restricted cash		330	295
Long-term restricted cash		6,056	4,950
Income taxes paid		15,214	10,596
Interest paid		23,398	41,577
Supplemental non-cash information:
Acquisitions of equipment included in accounts payable		41,897	30,926
Acquired in-process research and development included in accrued expenses		45,000	20,000


	Attributable to BeiGene, Ltd.
	Ordinary Shares		Additional Paid-In Capital	Accumulated Other Comprehensive Income	Accumulated Deficit	Total	Noncontrolling Interests
	Shares	Amount						Total
		$	$	$	$	$	$	$
Balance at December 31, 2020	1,190,821,941	118	7,414,932	6,942	(3,552,749)	3,869,243	—	3,869,243
Use of shares reserved for share option exercises	(123,097)	—	—	—	—	—	—	—
Exercise of options, ESPP and release of Restricted Share Units ("RSUs")	6,623,773	1	25,753	—	—	25,754	—	25,754
Share-based compensation	—	—	45,833	—	—	45,833	—	45,833
Other comprehensive loss	—	—	—	(3,738)	—	(3,738)	—	(3,738)
Net income	—	—	—	—	66,495	66,495	—	66,495
Balance at March 31, 2021	1,197,322,617	119	7,486,518	3,204	(3,486,254)	4,003,587	—	4,003,587
Use of shares reserved for share option exercises	(1,599,676)	—	—	—	—	—	—	—
Exercise of options, ESPP and release of Restricted Share Units ("RSUs")	8,844,082	1	9,846	—	—	9,847	—	9,847
Share-based compensation	—	—	64,791	—	—	64,791	—	64,791
Other comprehensive income	—	—	—	8,891	—	8,891	—	8,891
Net loss	—	—	—	—	(480,341)	(480,341)	—	(480,341)
Balance at June 30, 2021	1,204,567,023	120	7,561,155	12,095	(3,966,595)	3,606,775	—	3,606,775
Proceeds from issuance of ordinary shares, net of cost	2,151,877	—	50,000	—	—	50,000	—	50,000
Use of shares reserved for share option exercises	(3,644,641)	—	—	—	—	—	—	—
Exercise of options, ESPP and release of Restricted Share Units ("RSUs")	10,159,942	1	46,590	—	—	46,591	—	46,591
Share-based compensation	—	—	67,077	—	—	67,077	—	67,077
Other comprehensive income	—	—	—	485	—	485	—	485
Net loss	—	—	—	—	(413,855)	(413,855)	—	(413,855)
Balance at September 30, 2021	1,213,234,201	121	7,724,822	12,580	(4,380,450)	3,357,073	—	3,357,073

Balance at December 31, 2019	801,340,698	79	2,925,970	(8,001)	(1,955,843)	962,205	16,150	978,355
Issuance of ordinary shares in connection with collaboration	206,635,013	21	2,162,386	—	—	2,162,407	—	2,162,407
Use of shares reserved for share option exercises	(3,705,468)	—	—	—	—	—	—	—
Exercise of options, ESPP and release of Restricted Share Units ("RSUs")	3,706,573	1	11,628	—	—	11,629	—	11,629
Share-based compensation	—	—	38,255	—	—	38,255	—	38,255
Other comprehensive income	—	—	—	1,453	—	1,453	(104)	1,349
Net loss	—	—	—	—	(363,735)	(363,735)	(1,204)	(364,939)
Balance at March 31, 2020	1,007,976,816	101	5,138,239	(6,548)	(2,319,578)	2,812,214	14,842	2,827,056
Exercise of options, ESPP and release of Restricted Share Units ("RSUs")	10,493,392	1	16,568	—	—	16,569	—	16,569
Use of shares reserved for share option exercises and RSU releases	(3,493,516)	—	—	—	—	—	—	—
Share-based compensation	—	—	45,468	—	—	45,468	—	45,468
Deconsolidation of entity	—	—	—	—	—	—	(3,545)	(3,545)
Other comprehensive loss	—	—	—	(2,751)	—	(2,751)	13	(2,738)
Net loss	—	—	—	—	(335,202)	(335,202)	(1,116)	(336,318)


Balance at June 30, 2020	1,014,976,692	102	5,200,275	(9,299)	(2,654,780)	2,536,298	10,194	2,546,492
Proceeds from issuance of ordinary shares, net of cost	145,838,979	14	2,069,596	—	—	2,069,610	—	2,069,610
Exercise of options, ESPP and release of Restricted Share Units ("RSUs")	16,575,806	1	47,631	—	—	47,632	—	47,632
Use of shares reserved for share option exercises and RSU releases	5,525,182	1	—	—	—	1	—	1
Share-based compensation	—	—	50,297	—	—	50,297	—	50,297
Other comprehensive income	—	—	—	8,880	—	8,880	219	9,099
Net loss	—	—	—	—	(425,224)	(425,224)	(1,393)	(426,617)
Balance at September 30, 2020	1,182,916,659	118	7,367,799	(419)	(3,080,004)	4,287,494	9,020	4,296,514


	Quoted Price
	in Active	Significant
	Market for	Other	Significant
	Identical	Observable	Unobservable
	Assets	Inputs	Inputs
As of September 30, 2021	(Level 1)	(Level 2)	(Level 3)
	$	$	$
Cash equivalents
U.S. treasury securities	237,796	—	—
Money market funds	62,291	—	—
Short-term investment (Note 4):
U.S. Treasury securities	2,533,617	—	—
Other non-current assets (Note 4):
Equity securities with readily determinable fair values	29,467	13,650	—
Total	2,863,171	13,650	—


		Gross	Gross	Fair Value
	Amortized	Unrealized	Unrealized	(Net Carrying
	Cost	Gains	Losses	Amount)
	$	$	$	$
U.S. treasury securities	2,533,886	—	(269)	2,533,617
Total	2,533,886	—	(269)	2,533,617


	As of
	September 30, 2021			December 31, 2020
	Gross			Gross
	carrying	Accumulated	Intangible	carrying	Accumulated	Intangible
	amount	amortization	assets, net	amount	amortization	assets, net
	$	$	$	$	$	$
Finite-lived intangible assets:
Product distribution rights	7,500	(3,063)	4,437	7,500	(2,500)	5,000
Developed product	10,000	(333)	9,667	—	—	—
Trading license	816	(816)	—	816	(816)	—
Total finite-lived intangible assets	18,316	(4,212)	14,104	8,316	(3,316)	5,000


Lender	Agreement Date	Line of Credit	Term	Maturity Date	Interest Rate		September 30, 2021		December 31, 2020
							$	RMB	$	RMB
China Construction Bank	April 4, 2018	RMB580,000	9-year	April 4, 2027	(1)		776	5,000	307	2,000
China Merchants Bank	January 22, 2020	(2)	9-year	January 20, 2029	(2)		1,164	7,500	—	—
China Minsheng Bank (the "Senior Loan")	September 24, 2020	$200,000	(3)		5.8	%	198,320	1,277,835	198,320	1,294,010
Zhuhai Hillhouse (the "Related Party Loan")	September 24, 2020	RMB500,000	(4)		5.8	%	15,520	100,000	15,326	100,000
Other short-term debt (5)							226,592	1,460,000	121,062	789,918
Total short-term debt							442,372	2,850,335	335,015	2,185,928

China Construction Bank	April 4, 2018	RMB580,000	9-year	April 4, 2027	(1)		89,085	574,000	88,584	578,000
China Merchants Bank	January 22, 2020	(2)	9-year	January 20, 2029	(2)		53,156	342,500	53,641	350,000
China Merchants Bank	November 9, 2020	RMB378,000	9-year	November 8, 2029	(6)		58,665	378,000	41,412	270,206
Total long-term bank loans							200,906	1,294,500	183,637	1,198,206


		Market Price1				Purchase Price2
Issuance Date	Number of Ordinary Shares Issued	ADS		Ordinary		ADS		Ordinary		Proceeds
August 31, 2021	425,386	$	308.30	$	23.72	$	262.06	$	20.16	$	8,575
February 26, 2021	436,124	$	236.30	$	18.18	$	200.86	$	15.45	$	6,738
August 31, 2020	485,069	$	164.06	$	12.62	$	139.45	$	10.73	$	5,203
February 28, 2020	425,425	$	145.54	$	11.20	$	123.71	$	9.52	$	4,048


	As of
	September 30,	December 31,
	2021	2020
	$	$
Raw materials	54,993	19,330
Work in process	10,397	1,378
Finished goods	85,589	68,585
Total inventories	150,979	89,293


	As of
	September 30,	December 31,
	2021	2020
	$	$
Laboratory equipment	109,950	78,640
Leasehold improvements	47,521	37,643
Building	133,478	111,527
Manufacturing equipment	114,408	96,669
Software, electronics and office equipment	26,160	20,782
Property, plant and equipment, at cost	431,517	345,261
Less accumulated depreciation	(110,086)	(73,354)
Construction in progress	129,357	85,779
Property, plant and equipment, net	450,788	357,686


	As of
	September 30,	December 31,
	2021	2020
	$	$
Compensation related	104,878	106,765
External research and development activities related	163,937	143,302
Commercial activities	67,100	66,131
Employee tax withholdings	27,494	14,373
Sales rebates and returns related	20,190	11,874
Professional fees and other	6,275	3,699
Total	389,874	346,144


	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2021	2020	2021	2020
	$	$	$	$
Tislelizumab	76,980	49,934	200,738	99,877
BRUKINSA®	65,832	15,662	130,345	23,353
REVLIMID®	20,209	14,067	46,984	38,914
VIDAZA®	5,810	8,366	12,771	26,198
ABRAXANE®	—	—	—	17,381
XGEVA®	15,699	3,051	33,491	3,051
BLINCYTO®	5,040	—	5,040	—
Pamiparib	1,516	—	3,737	—
Other	1,375	—	4,096	—
Total product revenue – net	192,461	91,080	437,202	208,774


		Unrealized
	Foreign Currency	Gains/(Losses) on	Pension
	Translation	Available-for-Sale	Liability
	Adjustments	Securities	Adjustments	Total
	$	$	$	$
Balance as of December 31, 2020	14,184	871	(8,113)	6,942
Other comprehensive (loss) income before reclassifications	6,528	(1,078)	250	5,700
Amounts reclassified from accumulated other comprehensive income (1)	—	(62)	—	(62)
Net-current period other comprehensive (loss) income	6,528	(1,140)	250	5,638
Balance as of September 30, 2021	20,712	(269)	(7,863)	12,580


	Three Months Ended
	September 30,				Changes
	2021		2020		$		%
	(dollars in thousands)
Product revenue	$	192,461	$	91,080	$	101,381	111.3	%
Collaboration revenue:

Research and development service revenue	13,979		—		13,979		NM
Total collaboration revenue	13,979		—		13,979		NM
Total Revenue	$	206,440	$	91,080	$	115,360	126.7	%


	Nine Months Ended September 30,
	2021		2020

	(dollars in thousands)
Cash, cash equivalents and restricted cash at beginning of period	$	1,390,005	$	620,775
Net cash used in operating activities	(790,884)		(951,127)
Net cash provided by (used in) investing activities	531,549		(3,081,441)
Net cash provided by financing activities	252,257		4,877,168
Net effect of foreign exchange rate changes	6,769		4,340
Net (decrease) increase in cash, cash equivalents, and restricted cash	(309)		848,940
Cash, cash equivalents and restricted cash at end of period	$	1,389,696	$	1,469,715


	Payments Due by Period
			Less Than						More Than
	Total		1 Year		1–3 Years		3–5 Years		5 Years
	(dollars in thousands)
Contractual obligations
Operating lease commitments	$	61,174	$	4,859	$	37,007	$	18,000	$	1,308
Purchase commitments	268,498		190,897		33,184		30,757		13,660
Debt obligations	643,278		442,372		35,873		75,234		89,799
Interest on debt	71,513		36,592		17,390		12,162		5,369
Co-development funding commitment	851,124		311,750		539,374		—		—
Funding commitment	13,500		4,500		4,500		4,500		—
Research and development commitment	74,392		50,617		11,744		12,031		—
Pension plan	7,863		1,285		2,570		2,570		1,438
Capital commitments	57,720		57,720		—		—		—
Total	$	2,049,062	$	1,100,592	$	681,642	$	155,254	$	111,574


	BEIGENE, LTD.

Date: November 4, 2021	By:	/s/ John V. Oyler
	John V. Oyler
	Chief Executive Officer and Chairman
	(Principal Executive Officer)

Date: November 4, 2021	By:	/s/ Julia Wang
	Julia Wang
	Chief Financial Officer
	(Principal Financial and Accounting Officer)