Genmab A/S reported an increase in 2017 operating income and revenue versus 2016, partially offset by increased operating expenses.
Operating income was 1.34 billion Danish kroner, compared to 1.05 billion kroner in 2016. The 28% increase was driven by higher revenue.
Genmab's net result declined slightly to 1.10 billion kroner, or 17.77 kroner per share, from 1.19 billion kroner, or 19.22 kroner per share, in 2016.
The S&P Capital IQ consensus normalized EPS estimate for 2017 was 17.35 kroner.
Revenue was 2.37 billion kroner in 2017, up from 1.82 billion kroner in the previous year. The 30% increase in revenue was mainly driven by higher Darzalex royalties under the company's daratumumab collaboration with Johnson & Johnson unit Janssen.
Operating expenses rose 258 million kroner to 1.02 billion kroner in 2017, from 763 million kroner in 2016. The 34% increase in operating expenses was a result of the advancement of tisotumab vedotin, additional investment in Genmab's product pipeline and increase in employees to support the expansion of the company's pipeline.
The Copenhagen, Denmark-based drug maker expects operating income to be between 1.30 billion kroner to 1.50 billion kroner in 2018. It expects revenue to be in the range of 2.70 billion kroner to 3.10 billion kroner.
Genmab's foretasted revenue mainly comprises Darzalex royalties of about 1.75 billion kroner that are based on an estimated $2.0 billion to $2.3 billion of Darzalex net sales in 2018. The overall increase in revenue compared to 2017 is primarily due to a one-time payment from Novartis AG combined with higher Darzalex royalties, which were partly offset by a decrease in Darzalex milestones.
Darzalex milestones are expected to reach about 550 million kroner in 2018, consisting mainly of a commercial net sales-based milestone, compared to 1.11 billion in 2017.
The 2018 guidance also includes the one-time payment from Novartis of about 300 million kroner related to the transition of Arzerra from commercial availability to compassionate-use programs in non-U.S. markets. The remainder of the revenue consists of cost reimbursement income, Arzerra royalties and DuoBody milestones.
Genmab predicts operating expenses to be in the range of 1.40 billion kroner to 1.60 billion kroner in 2018.
As of Feb. 20, US$1 was equivalent to 6.04 Danish kroner.