FibroGen, Inc. (NASDAQ:FGEN) is a biopharmaceutical company developing and commercializing a diversified pipeline of novel therapeutics that work at the frontier of cancer biology and anemia. The company's financial performance in 2023 showcased its resilience, with annual revenue of $147.8 million and a net loss of $284.2 million. Despite the net loss, FibroGen's cash position remains strong, with $214.7 million in cash, cash equivalents, investments, and accounts receivable as of March 31, 2024.

FibroGen's lead product candidates, pamrevlumab and roxadustat, continue to demonstrate promising progress. Pamrevlumab, a first-in-class antibody targeting connective tissue growth factor (CTGF), is in late-stage clinical development for the treatment of locally advanced unresectable pancreatic cancer (LAPC) and metastatic pancreatic cancer. The company expects to report topline data from the Precision Promise Phase 2/3 trial in metastatic pancreatic cancer and the LAPIS Phase 3 trial in LAPC in mid-2024 and the third quarter of 2024, respectively.

Roxadustat, an oral small molecule inhibitor of HIF prolyl hydroxylase activity, is approved in China, Europe, Japan, and numerous other countries for the treatment of anemia in chronic kidney disease (CKD) for patients who are on dialysis and not on dialysis. In the first quarter of 2024, roxadustat net sales in China by FibroGen and the distribution entity jointly owned by FibroGen and AstraZeneca were $79.4 million, a 24% increase compared to the first quarter of 2023. FibroGen's portion of roxadustat net product revenue in China was $30.5 million, a 26% increase year-over-year. The company expects full-year 2024 FibroGen China product revenue to be between $120 million and $135 million.

In addition to its late-stage assets, FibroGen's early-stage oncology pipeline holds significant promise. The company recently reported compelling topline data from the Phase 1 monotherapy study of FG-3246, a first-in-class antibody-drug conjugate (ADC) targeting CD46, in patients with metastatic castration-resistant prostate cancer (mCRPC). FG-3246 demonstrated a median radiographic progression-free survival of 8.7 months and a 20% partial response rate in RECIST evaluable patients. FibroGen plans to initiate a Phase 2 monotherapy dose optimization study of FG-3246 for mCRPC in the second half of 2024.

FibroGen's financial position remains strong, with the company expecting its current cash, cash equivalents, investments, and accounts receivable to be sufficient to fund its operating plans into 2026. In the first quarter of 2024, the company reported a net loss of $32.9 million, or $0.33 per share, compared to a net loss of $76.7 million, or $0.81 per share, in the same period of 2023. The decrease in net loss was primarily driven by a 23% reduction in total operating costs and expenses, which were $87.0 million in the first quarter of 2024 compared to $112.3 million in the same period of 2023.

FibroGen's cash flow performance also showed improvement, with net cash used in operating activities decreasing from $101.6 million in the first quarter of 2023 to $59.3 million in the first quarter of 2024. The company's free cash flow, defined as net cash used in operating activities less purchases of property and equipment, was -$59.3 million in the first quarter of 2024, compared to -$102.2 million in the same period of 2023.

Geographically, FibroGen's operations are primarily focused on China, where the company has established a strong presence for its roxadustat product. In the first quarter of 2024, FibroGen's net product revenue from roxadustat sales in China was $30.5 million, accounting for 54.6% of the company's total revenue. The company's development and other revenue, which includes revenue from its collaboration agreements with Astellas and AstraZeneca, was $0.9 million in the first quarter of 2024, a decrease from $3.9 million in the same period of 2023.

FibroGen's drug product revenue, which includes commercial-grade active pharmaceutical ingredient (API) or bulk drug product sales to Astellas and AstraZeneca, was $24.5 million in the first quarter of 2024, a significant increase from $2.1 million in the same period of 2023. This increase was primarily due to a one-time adjustment of $25.7 million related to the termination of the AstraZeneca U.S./RoW Agreement, partially offset by a $1.2 million reduction in drug product revenue related to API deliveries to Astellas.

The company's research and development (R&D) expenses decreased by 48% year-over-year in the first quarter of 2024, from $74.5 million to $38.4 million, primarily due to reductions in pamrevlumab clinical trial spending and other R&D infrastructure. Selling, general, and administrative (SG&A) expenses also decreased by 33.5% year-over-year, from $34.3 million to $22.8 million, driven by the company's cost reduction efforts.

Looking ahead, FibroGen's guidance for the full year 2024 remains unchanged. The company expects total operating expenses, including cost of goods sold, to be between $70 million and $80 million for the second quarter of 2024. The company's operating expenses in the second half of 2024 will be determined by the outcomes of the two pivotal clinical trial readouts for pamrevlumab in pancreatic cancer.

In summary, FibroGen's diversified pipeline, strong financial position, and continued operational execution position the company for significant value creation. The upcoming data readouts for pamrevlumab and the promising progress of FG-3246 in prostate cancer, coupled with the robust performance of roxadustat in China, provide a solid foundation for the company's future growth.