LEGN Reports 143.7% Annual Revenue Growth Driven by $500M Sales of CARVYKTI® (Cilta-cel) in 2023

On March 11, 2024, local time, Legend Biotech (NASDAQ: LEGN) released its unaudited financial results for the fourth quarter and full year of 2023, along with key corporate highlights, from Somerset, New Jersey, USA. The financial report showed that Legend Biotech’s total revenue in Q4 amounted to $79.464 million, representing an increase of approximately 187.6% compared to $27.633 million in the same period of the previous year. For the full year, the company achieved external revenues of $285 million, a year-over-year increase of 143.7%.

In January of the same year, Johnson & Johnson had just released its full-year 2023 financial results. This follows a licensing agreement reached in 2017 between Legend Biotech and Janssen, a subsidiary of Johnson & Johnson, for the co-development of ciltacabtagene autoleucel (brand name: CARVYKTI®; abbreviated as Cilta-cel). Under the terms of the agreement, revenues from Chinese rights are shared 70:30 between the two parties, while overseas revenues are split 50:50.

Notably, ciltacabtagene autoleucel, an in-house developed cell therapy product approved by the U.S. FDA in February 2022, generated approximately $159 million in sales in the fourth quarter, representing a 194% year-over-year increase from 2022.

Based on Johnson & Johnson’s previously disclosed performance data for ciltacabtagene autoleucel, the product’s sales in the first three quarters were $72 million, $117 million, and $152 million, respectively. When combined with fourth-quarter sales, this brings the total annual sales of ciltacabtagene autoleucel in 2023 to approximately $500 million (equivalent to roughly RMB 3.6 billion), representing a year-on-year increase of approximately 273% compared with $134 million in 2022.

Cilta-cel: The Birth of a Blockbuster Star

Cilta-cel is a BCMA CAR-T therapy independently developed by Legend Biotech. It is a chimeric antigen receptor T-cell (CAR-T) product targeting B-cell maturation antigen (BCMA), which uses transgenic chimeric antigen receptors (CARs) to modify patients’ own T cells to recognize and eliminate BCMA-expressing cells. BCMA is primarily expressed on the surface of malignant multiple myeloma B cells, late-stage B cells, and plasma cells. The CAR protein of cilta-cel incorporates two BCMA-targeting single-domain antibodies, exhibiting high affinity for BCMA-expressing cells. Upon binding to these cells, the CAR promotes T-cell activation and expansion, leading to the clearance of target cells.

It is worth noting that this product is also closely intertwined with the founding and development of Legend Biotech, accompanying its growth from a startup with fewer than 10 employees into a multinational pharmaceutical company.

According to Dr. Ying Huang, CEO of Legend Biotech, the company’s success to date is attributable to its adoption of a differentiated product strategy at inception and its strategic partnership with pharmaceutical giant Johnson & Johnson.

As a biotechnology company focused on CAR-T drug development, Legend Biotech did not follow the trend when it was founded in 2014. Instead, it first investigated unmet clinical needs and ultimately found that multiple myeloma is difficult to treat, highly prone to relapse, limited in treatment options, and associated with poor prognosis. With patients affected worldwide, the company decided to target multiple myeloma as the indication for product development.

In terms of target selection, Legend Biotech also carved out a unique path by opting for the then-niche BCMA target rather than the more popular CD19 or CD20. At that time, drug development targeting BCMA was virtually uncharted territory, positioning Legend Biotech as the CAR-T company that filled this gap.

Furthermore, to ensure that its in-house developed drugs truly benefit patients, Legend Biotech has adopted an innovative bispecific antibody design in the CAR structure, simultaneously targeting two distinct epitopes of the BCMA protein, while also pursuing differentiated approaches in viral vectors and manufacturing processes.

Various endeavors facilitated the launch of its first product, cilta-cel. Approved for marketing in the United States, Europe, and Japan, it has become China’s first original CAR-T product to successfully enter international markets.

Thus, in planning its global expansion, Legend Biotech opted for a “partner-led” strategy to compensate for its then-limited capabilities in late-stage clinical development, GMP manufacturing, global regulatory registration, and international commercialization. Pursuing international collaboration through licensing deals represented a relatively prudent pathway.

Thus, a landmark event in Legend Biotech’s history occurred—the signing of a strategic collaboration agreement with Janssen, a subsidiary of Johnson & Johnson. This move accelerated the clinical development and commercialization of cilta-cel, provided Legend Biotech with substantial funding ($350 million in upfront payments and $335 million in milestone payments), and opened the door to the global market.

On February 28, 2022, local time, Legend Biotech officially announced in Somerset, New Jersey, USA, that its independently developed cell therapy product, ciltacabtagene autoleucel, had received approval from the U.S. Food and Drug Administration (FDA) for marketing. It is indicated for the treatment of patients with relapsed or refractory multiple myeloma (R/R MM) who have previously received four or more prior lines of therapy, including a proteasome inhibitor, an immunomodulatory agent, and an anti-CD38 monoclonal antibody. It took just over four years from the signing of the collaboration agreement between Legend Biotech and Janssen to the successful global launch of ciltacabtagene autoleucel.

Next Step: Scale-up Production

Legend Biotech’s reported results and highlights also include: The CHMP (Committee for Medicinal Products for Human Use of the European Medicines Agency) has recommended expanding the indication for cilta-cel to include first-line treatment of adult patients with relapsed and lenalidomide-refractory multiple myeloma. The FDA ODAC (Oncologic Drugs Advisory Committee of the U.S. Food and Drug Administration) will convene a meeting on March 15 to review data from the CARTITUDE-4 study, which supports the use of cilta-cel for the first-line treatment of adult patients with relapsed and lenalidomide-refractory multiple myeloma.

In terms of key business developments, Birk Vanderweeën has been promoted to Senior Vice President of Global Manufacturing and Supply, where he will oversee the production and global patient supply of CARVYKTI®. Previously, he served as General Manager for Europe. Mr. Vanderweeën brings over 25 years of experience in operations, quality, supply chain, and manufacturing at industry-leading companies.

Furthermore, Legend Biotech’s official website specifically highlights that its production capacity has expanded by 100% since early 2023, including the initiation of clinical manufacturing at its new Obelisc facility in Ghent, with a target of achieving an annual production capacity of 10,000 doses by the end of 2025.

Interestingly, in March 2023, the marketing authorization application for ciltacabtagene autoleucel was suspended in the United Kingdom. Although Legend Biotech did not disclose the reasons for the suspension, the National Institute for Health and Care Excellence (NICE) stated in a declaration that the suspension of the application for ciltacabtagene autoleucel might be related to production capacity and supply.

Unlike other anticancer drugs, CAR-T therapy requires the reinfusion of the patient’s own cells, meaning that CAR-T therapy necessitates a degree of “personalized customization,” making large-scale manufacturing extremely challenging. In 2022, Legend Biotech publicly stated that the shortage of lentiviral vectors (a core raw material) was the primary obstacle hindering the broader adoption of ciltacabtagene autoleucel.

This may explain why Legend Biotech will aggressively expand production capacity and further optimize its supply chain in the future.

On a positive note, as of December 31, 2023, Legend Biotech’s cash and cash equivalents, deposits, and short-term investments totaled $1.3 billion, which the company believes will provide funding support through the end of 2025.