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Puma Biotech (PBYI) Q3 Earnings Beat, Revenues Lag Estimates
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Puma Biotechnology, Inc. (PBYI - Free Report) reported third-quarter 2023 adjusted earnings of 17 cents per share, which beat the Zacks Consensus Estimate of 15 cents. In the year-ago quarter, the company had reported adjusted earnings of 5 cents.
The above-adjusted loss excludes the impact of stock-based compensation expense, including which reported earnings per share were 12 cents in the third quarter of 2023 against a loss of 1 cent reported in the year-ago quarter.
In the third quarter, total revenues were $56.1 million, which missed the Zacks Consensus Estimate of $58 million.
Revenues declined around 1.7% year over year. Total revenues comprised net product sales of Nerlynx (neratinib), Puma Biotech's only marketed drug in the United States, and license fees from PBYI’s sub-licensees and royalty revenues. Nerlynx is indicated for treating early-stage HER2-positive breast cancer.
Shares of Puma Biotech have plunged 41.1% so far this year compared with the industry’s 23.5% decline.
Image Source: Zacks Investment Research
Quarter in Detail
Product revenues from Nerlynx were $51.6 million in the reported quarter, down 5% year over year, as sales were hurt by inventory drawdown at specialty pharmacies and specialty distributors. Nerlynx’s product sales were within the guidance range of $51-$53 million. Product revenues, however, missed the Zacks Consensus Estimate of $53 million as well as our model estimate of $52.9 million. Product revenues were flat sequentially.
On the third-quarter conference call, management stated that demand for Nerlynx declined 10% year over year and 8.5% sequentially. Nerlynx total prescriptions decreased year over year and sequentially in the third quarter. New prescriptions also declined year over year and sequentially.
Royalty revenues were $4.5 million, up almost 60.7% from the year-ago quarter. Royalty revenues increased 50% sequentially due to the favorable timing of shipments to the company’s partner in China. Royalty revenues were within the guidance range of $3 million to $5 million.
Puma Biotech did not record any license revenues in the third quarter.
Total operating costs (including stock-based compensation expense) in the quarter were $47.5 million, down 13.1% year over year.
Selling, general and administrative expenses (including stock-based compensation expense) were down 5% year over year to $22.8 million.
Research and development expenses (including stock-based compensation expense) were $11.4 million in the quarter, up 1.8% year over year.
Cash, cash equivalents and marketable securities were $85 million as of Sep 30, 2023 compared with $74.4 million as of Jun 30, 2023.
2023 Guidance
Puma Biotech tightened its previously issued guidance for 2023. The company now expects Nerlynx’s product sales in the range of $206-$209 million compared with the earlier expectation of $205-$210 million.
Royalty revenues are now expected to be in the $30-$32 million range compared with the earlier range of $25-$30 million. Net income is now expected to be in the range of $22-$25 million compared with the earlier projection of $20-$24 million.
Total operating expenses are anticipated to decline in 2023 from the 2022 level. SG&A is expected to increase approximately 1-2%, while R&D is expected to rise 1-3% year over year.
In the fourth quarter of 2023, Nerlynx’s product sales are expected to be in the range of $56-$59 million, while royalty revenues are expected to be $16-$19 million. Net income is expected to be in the range of $13-$16 million.
Pipeline Update
In September 2023, the FDA granted Orphan Drug designation to Puma Biotech’s pipeline candidate alisertib for treating patients with small cell lung cancer (SCLC), an aggressive form of lung cancer.
Puma Biotech in-licensed the global development and commercialization rights to alisertib, an aurora kinase A inhibitor, from Japan’s Takeda in 2022.
In August 2023, the FDA cleared the investigational new drug application to begin clinical development of alisertib to treat patients with SCLC. PBYI plans to initiate a phase II PUMA-ALI-4201 study later in the fourth quarter of 2023.
Per the company, alisertib has potential in HR-positive, HER2-negative breast cancer, triple-negative breast cancer, head and neck cancer and small cell lung cancer, based on the results of the already completed mid-stage studies.
PBYI also plans to conduct a meeting with the FDA to discuss the registration pathway for alisertib in HR-positive, HER2-negative breast cancer later in the fourth quarter of 2023. The company plans to begin a phase II study on alisertib in hormone receptor positive, HER2-negative breast cancer in 2024.
Puma Biotechnology, Inc. Price, Consensus and EPS Surprise
In the past 60 days, estimates for Dynavax Technologies’ 2023 loss per share have narrowed from 24 cents to 22 cents. Meanwhile, during the same period, earnings per share estimates for 2024 have improved from 2 cents to 8 cents. Year to date, shares of DVAX have rallied 32.2%.
Earnings of Dynavax Technologies beat estimates in two of the last four quarters while missing the same on the remaining two occasions. DVAX delivered a four-quarter average earnings surprise of 25.78%.
In the past 60 days, estimates for MEI Pharma’s 2023 loss per share have improved from $6.54 to $4.89. During the same period, loss per share estimates for 2024 have narrowed from $5.14 to $4.02. Year to date, shares of MEIP have rallied 41.6%.
Earnings of MEI Pharma beat estimates in three of the trailing four quarters and met the same on the other occasion. On average, MEIP came up with a four-quarter earnings surprise of 53.58%.
In the past 60 days, Ligand Pharmaceuticals’ earnings per share estimates for 2023 have improved from $4.98 to $5.10. During the same period, earnings per share estimates for 2024 have moved up from $4.26 to $4.59. Year to date, shares of LGND have lost 22.4%.
Earnings of Ligand Pharmaceuticals beat estimates in three of the trailing four quarters and missed the same on the other occasion. On average, LGND came up with a four-quarter earnings surprise of 52.47%.
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Puma Biotech (PBYI) Q3 Earnings Beat, Revenues Lag Estimates
Puma Biotechnology, Inc. (PBYI - Free Report) reported third-quarter 2023 adjusted earnings of 17 cents per share, which beat the Zacks Consensus Estimate of 15 cents. In the year-ago quarter, the company had reported adjusted earnings of 5 cents.
The above-adjusted loss excludes the impact of stock-based compensation expense, including which reported earnings per share were 12 cents in the third quarter of 2023 against a loss of 1 cent reported in the year-ago quarter.
In the third quarter, total revenues were $56.1 million, which missed the Zacks Consensus Estimate of $58 million.
Revenues declined around 1.7% year over year. Total revenues comprised net product sales of Nerlynx (neratinib), Puma Biotech's only marketed drug in the United States, and license fees from PBYI’s sub-licensees and royalty revenues. Nerlynx is indicated for treating early-stage HER2-positive breast cancer.
Shares of Puma Biotech have plunged 41.1% so far this year compared with the industry’s 23.5% decline.
Quarter in Detail
Product revenues from Nerlynx were $51.6 million in the reported quarter, down 5% year over year, as sales were hurt by inventory drawdown at specialty pharmacies and specialty distributors. Nerlynx’s product sales were within the guidance range of $51-$53 million. Product revenues, however, missed the Zacks Consensus Estimate of $53 million as well as our model estimate of $52.9 million. Product revenues were flat sequentially.
On the third-quarter conference call, management stated that demand for Nerlynx declined 10% year over year and 8.5% sequentially. Nerlynx total prescriptions decreased year over year and sequentially in the third quarter. New prescriptions also declined year over year and sequentially.
Royalty revenues were $4.5 million, up almost 60.7% from the year-ago quarter. Royalty revenues increased 50% sequentially due to the favorable timing of shipments to the company’s partner in China. Royalty revenues were within the guidance range of $3 million to $5 million.
Puma Biotech did not record any license revenues in the third quarter.
Total operating costs (including stock-based compensation expense) in the quarter were $47.5 million, down 13.1% year over year.
Selling, general and administrative expenses (including stock-based compensation expense) were down 5% year over year to $22.8 million.
Research and development expenses (including stock-based compensation expense) were $11.4 million in the quarter, up 1.8% year over year.
Cash, cash equivalents and marketable securities were $85 million as of Sep 30, 2023 compared with $74.4 million as of Jun 30, 2023.
2023 Guidance
Puma Biotech tightened its previously issued guidance for 2023. The company now expects Nerlynx’s product sales in the range of $206-$209 million compared with the earlier expectation of $205-$210 million.
Royalty revenues are now expected to be in the $30-$32 million range compared with the earlier range of $25-$30 million. Net income is now expected to be in the range of $22-$25 million compared with the earlier projection of $20-$24 million.
Total operating expenses are anticipated to decline in 2023 from the 2022 level. SG&A is expected to increase approximately 1-2%, while R&D is expected to rise 1-3% year over year.
In the fourth quarter of 2023, Nerlynx’s product sales are expected to be in the range of $56-$59 million, while royalty revenues are expected to be $16-$19 million. Net income is expected to be in the range of $13-$16 million.
Pipeline Update
In September 2023, the FDA granted Orphan Drug designation to Puma Biotech’s pipeline candidate alisertib for treating patients with small cell lung cancer (SCLC), an aggressive form of lung cancer.
Puma Biotech in-licensed the global development and commercialization rights to alisertib, an aurora kinase A inhibitor, from Japan’s Takeda in 2022.
In August 2023, the FDA cleared the investigational new drug application to begin clinical development of alisertib to treat patients with SCLC. PBYI plans to initiate a phase II PUMA-ALI-4201 study later in the fourth quarter of 2023.
Per the company, alisertib has potential in HR-positive, HER2-negative breast cancer, triple-negative breast cancer, head and neck cancer and small cell lung cancer, based on the results of the already completed mid-stage studies.
PBYI also plans to conduct a meeting with the FDA to discuss the registration pathway for alisertib in HR-positive, HER2-negative breast cancer later in the fourth quarter of 2023. The company plans to begin a phase II study on alisertib in hormone receptor positive, HER2-negative breast cancer in 2024.
Puma Biotechnology, Inc. Price, Consensus and EPS Surprise
Puma Biotechnology, Inc. price-consensus-eps-surprise-chart | Puma Biotechnology, Inc. Quote
Zacks Rank & Other Stocks to Consider
Puma Biotech currently carries a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the healthcare sector are Dynavax Technologies Corporation (DVAX - Free Report) , MEI Pharma, Inc. (MEIP - Free Report) and Ligand Pharmaceuticals Incorporated , sporting a Zacks Rank #1 each. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, estimates for Dynavax Technologies’ 2023 loss per share have narrowed from 24 cents to 22 cents. Meanwhile, during the same period, earnings per share estimates for 2024 have improved from 2 cents to 8 cents. Year to date, shares of DVAX have rallied 32.2%.
Earnings of Dynavax Technologies beat estimates in two of the last four quarters while missing the same on the remaining two occasions. DVAX delivered a four-quarter average earnings surprise of 25.78%.
In the past 60 days, estimates for MEI Pharma’s 2023 loss per share have improved from $6.54 to $4.89. During the same period, loss per share estimates for 2024 have narrowed from $5.14 to $4.02. Year to date, shares of MEIP have rallied 41.6%.
Earnings of MEI Pharma beat estimates in three of the trailing four quarters and met the same on the other occasion. On average, MEIP came up with a four-quarter earnings surprise of 53.58%.
In the past 60 days, Ligand Pharmaceuticals’ earnings per share estimates for 2023 have improved from $4.98 to $5.10. During the same period, earnings per share estimates for 2024 have moved up from $4.26 to $4.59. Year to date, shares of LGND have lost 22.4%.
Earnings of Ligand Pharmaceuticals beat estimates in three of the trailing four quarters and missed the same on the other occasion. On average, LGND came up with a four-quarter earnings surprise of 52.47%.