PLX: First Quarter Results

By John Vandermosten, CFA

NYSE:PLX

READ THE FULL PLX RESEARCH REPORT

First Quarter 2025 Financial and Operational Review

Protalix Biotherapeutics, Inc. (NYSE:PLX) announced 1Q:25 financial and operational results in a May 9^th, 2025 press release and in its Form 10-Q filing. The reports were followed by a conference call which discussed recent achievements, clinical updates and financial performance. During the first quarter, Protalix generated material year over year growth in Elelyso sales to Pfizer and Brazil, and advanced towards its Phase II trial for PRX-115 anticipated to start in 2H:25. In addition to operating activities, Protalix management participated in a virtual investor event and its partner Chiesi presented numerous Elfabrio posters at the WorldSymposium.

While Elelyso revenues increased sharply in 1Q:25, Protalix did not recognize any Elfabrio revenues in the quarter. While we expect this line item to be volatile as Chiesi stocks up and then works through its inventories, zero sales for the first quarter of the year places our 2025 estimate at risk. Management did not provide any visibility for anticipated revenues for this year, so at best we have to shift forward our Elfabrio revenue estimates and penetration trends by a quarter, which results in a reduction in our valuation.

Financial results for the quarter ending March 31^st, 2025, compared to the same quarter in the prior year:

• Revenues were $10.1 million, up 170% from $3.7 million attributable to an increase of Pfizer and Brazil sales of Elelyso. Revenues from licensing were $118,000 representing catch up amounts for costs related to research and development related to Elfabrio;
• Cost of revenue was $8.2 million vs. $2.6 million reflecting greater Elelyso volumes;
• Research and development expenses rose 20% to $3.5 million from $2.9 million. Higher salary, subcontractor related expenses which supported the advancement of PRX-115 were the drivers for the change;
• Selling, general and administrative expenses were down 16% to $2.6 million compared to $3.1 million on a reduction in salary and related expenses as well as lower selling expenses;
• Net financial income was $413,000 compared to $123,000. The difference resulted primarily from lower notes-related interest expense due to the September 2024 debt repayment, partially offset by lower interest income on bank deposits and higher exchange rate costs;
• Income tax expense of ($113,000) compares to ($138,000);
• Net loss was ($3.6) million vs a net loss of ($4.6) million, or ($0.05) per share versus ($0.06) per share;

The cash and equivalents balance on March 31^st, 2025 totaled $34.7 million versus $34.8 million at the end of 2024. During 1Q:25, Protalix sold 1.3 million shares of common stock raising $3.0 million. The company subsequently amended the program to provide for the offer and sale of up to an additional $20.0 million. Furthermore, Protalix issued 908,000 shares of common stock in connection with the exercise of warrants raising $2.1 million. No warrants remain outstanding.

Presentations at WorldSymposium

Chiesi Rare Disease presented several posters at the 21^st Annual WORLDSymposium, held in early February 2025. The topics ranged from the side effect profile of Elfabrio to topics relevant to the broader Fabry community. See below for titles and links to the posters and presentations.

Milestones

• Chiesi gives multiple Fabry and Elfabrio presentations at WORLDSymposium Meeting – February 2025
• Participation in BIO CEO & Investor Conference – February 2025
• Fabry Disease Presentations (Chiesi) at the World Symposium Research Meeting – March 2025
• iAccess Alpha investor conference attendance – March 2025
• Ongoing enrollment in Japanese RISE study (Elfabrio) – 2025
• Pediatric FLY study for Fabry disease (Elfabrio) – 2025
• Initiate Phase II study for PRX-115 in gout – 2H:25
• Topline results from PRX-115 Phase II study – 2027

Summary

Protalix reported its first quarter 2025 results, exceeding expectations for Elelyso but generating no revenue from Elfabrio. We believe the commercial ramp-up for Elfabrio is progressing more slowly than initially projected, prompting us to push our revenue forecasts back by one quarter.

While first-quarter revenue fell short of our expectations, we note that Protalix’ sales are subject to timing variability. This can result in periods with no recorded revenue, even when patients consistently receive their prescriptions. In other news Chiesi Rare Disease remained active on the medical conference circuit, presenting eight posters addressing topics important to the Fabry community at the WORLDSymposium.

Despite the quarterly miss and downward revisions to our estimates, we maintain a positive long-term view. The company’s clean balance sheet and the expectation of generating positive free cash flow support this outlook. Importantly, Protalix avoids a common risk faced by small-cap biotechs: the need to raise dilutive capital. This positions the shareholder base to shift toward long-only investors.

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