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Nektar Q3 Loss Narrower Than Expected, Pipeline Development in Focus
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Nektar Therapeutics (NKTR - Free Report) incurred a loss per share of 18 cents in the third quarter of 2024, narrower than the Zacks Consensus Estimate of a loss of 23 cents.
In the year-ago quarter, the company reported an adjusted (excluding non-cash restructuring and impairment charges) loss of 18 cents.
Total revenues remained flat year over year at $24.1 million. The reported figure beat the Zacks Consensus Estimate of $16 million.
In the third quarter, product sales increased around 38% year over year to $8 million. Product sales beat the Zacks Consensus Estimate of $4.8 million as well as our model estimate of $5 million.
Non-cash royalty revenues were $15.7 million, down around 13% from the year-ago quarter. However, the reported figure beat the Zacks Consensus Estimate of $13.9 million as well as our model estimate of $10.3 million.
Shares of Nektar have skyrocketed 142.5% year to date against the industry’s decline of 3.4%.
Image Source: Zacks Investment Research
Research and development (R&D) expenses were $35 million, up 44% year over year, primarily due to higher development expenses for rezpegaldesleukin (rezpeg), NKTR-0165 and NKTR-255.
General and administrative (G&A) expenses declined 10% year over year to $19 million, primarily due to decreases in employee costs.
NKTR’s Key Pipeline Updates
Nektar’s lead pipeline candidate, rezpeg, is being developed as a self-administered injection for several autoimmune and inflammatory diseases. NKTR regained full rights to rezpeg from Eli Lily (LLY - Free Report) in April 2023 and took charge of its clinical development. Rezpeg was earlier developed in collaboration with Lilly for several autoimmune indications. Rezpeg is now a wholly owned asset of Nektar and the company owes no royalty payments to LLY.
A phase IIb study is ongoing in patients with moderate-to-severe atopic dermatitis, also called eczema. Initial data from this study is expected in the first half of 2025. Another phase IIb study is investigating rezpeg for treating patients with severe-to-very severe alopecia areata. Top-line data from this study is expected in the second half of 2025.
Moreover, Nektar has two TNFR2 antibody and bispecific programs, NKTR-0165 and NKTR-0166, in its pre-clinical pipeline. One of the two candidates is expected to enter clinical development in 2025.
In November, Nektar signed a definitive agreement with Ampersand Capital Partners to sell its commercial PEGylation Reagent manufacturing business in Huntsville, AL, for $90 million. The sale includes $70 million in cash and $20 million in equity in the new portfolio company. The Huntsville facility will operate independently as an Ampersand portfolio company, with Ampersand providing additional growth capital. Nektar and the new company will also establish supply agreements for PEG reagents for Nektar’s pipeline development programs. The transaction, subject to fulfillment of certain customary closing conditions, is expected to be finalized in December, with Nektar retaining rights to royalties and milestone payments on existing PEGylated product licenses, as well as a seat on the board of directors of the new entity.
NKTR’s Financial Guidance for 2024
Nectar expects its revenues for the full year to be in the range of $90-$95 million, which includes $60-65 million in non-cash royalties and $30-$35 million in product sales.
R&D cost for 2024 is expected between $120 million and $130 million, while G&A expenses are anticipated to be in the $75-$80 million range.
Nektar also expects to end 2024 with approximately $265 million in cash and investments, which is likely to fund operations into the fourth quarter of 2026.
Allogene Therapeutics’ loss estimates have remained constant at $1.41 per share for 2024 over the past 60 days, while that for 2025 has narrowed from $1.46 to $1.45 per share. ALLO’s shares have lost 0.6% year to date.
Allogene Therapeutics’ earnings beat estimates in three of the trailing four quarters and matched once, delivering an average surprise of 11.82%.
Novartis’ earnings estimates have risen from $7.50 to $7.56 per share for 2024 over the past 60 days, while that for 2025 has increased from $8.30 to $8.33. NVS’ shares have risen 6.1% year to date.
Novartis’ earnings beat estimates in three of the trailing four quarters and missed the same in one, delivering an average surprise of 2.22%.
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Nektar Q3 Loss Narrower Than Expected, Pipeline Development in Focus
Nektar Therapeutics (NKTR - Free Report) incurred a loss per share of 18 cents in the third quarter of 2024, narrower than the Zacks Consensus Estimate of a loss of 23 cents.
In the year-ago quarter, the company reported an adjusted (excluding non-cash restructuring and impairment charges) loss of 18 cents.
Total revenues remained flat year over year at $24.1 million. The reported figure beat the Zacks Consensus Estimate of $16 million.
See the Zacks Earnings Calendar to stay ahead of market-making news.
NKTR’s Q3 Results in Detail
In the third quarter, product sales increased around 38% year over year to $8 million. Product sales beat the Zacks Consensus Estimate of $4.8 million as well as our model estimate of $5 million.
Non-cash royalty revenues were $15.7 million, down around 13% from the year-ago quarter. However, the reported figure beat the Zacks Consensus Estimate of $13.9 million as well as our model estimate of $10.3 million.
Shares of Nektar have skyrocketed 142.5% year to date against the industry’s decline of 3.4%.
Image Source: Zacks Investment Research
Research and development (R&D) expenses were $35 million, up 44% year over year, primarily due to higher development expenses for rezpegaldesleukin (rezpeg), NKTR-0165 and NKTR-255.
General and administrative (G&A) expenses declined 10% year over year to $19 million, primarily due to decreases in employee costs.
NKTR’s Key Pipeline Updates
Nektar’s lead pipeline candidate, rezpeg, is being developed as a self-administered injection for several autoimmune and inflammatory diseases. NKTR regained full rights to rezpeg from Eli Lily (LLY - Free Report) in April 2023 and took charge of its clinical development. Rezpeg was earlier developed in collaboration with Lilly for several autoimmune indications. Rezpeg is now a wholly owned asset of Nektar and the company owes no royalty payments to LLY.
A phase IIb study is ongoing in patients with moderate-to-severe atopic dermatitis, also called eczema. Initial data from this study is expected in the first half of 2025. Another phase IIb study is investigating rezpeg for treating patients with severe-to-very severe alopecia areata. Top-line data from this study is expected in the second half of 2025.
Moreover, Nektar has two TNFR2 antibody and bispecific programs, NKTR-0165 and NKTR-0166, in its pre-clinical pipeline. One of the two candidates is expected to enter clinical development in 2025.
In November, Nektar signed a definitive agreement with Ampersand Capital Partners to sell its commercial PEGylation Reagent manufacturing business in Huntsville, AL, for $90 million. The sale includes $70 million in cash and $20 million in equity in the new portfolio company. The Huntsville facility will operate independently as an Ampersand portfolio company, with Ampersand providing additional growth capital. Nektar and the new company will also establish supply agreements for PEG reagents for Nektar’s pipeline development programs. The transaction, subject to fulfillment of certain customary closing conditions, is expected to be finalized in December, with Nektar retaining rights to royalties and milestone payments on existing PEGylated product licenses, as well as a seat on the board of directors of the new entity.
NKTR’s Financial Guidance for 2024
Nectar expects its revenues for the full year to be in the range of $90-$95 million, which includes $60-65 million in non-cash royalties and $30-$35 million in product sales.
R&D cost for 2024 is expected between $120 million and $130 million, while G&A expenses are anticipated to be in the $75-$80 million range.
Nektar also expects to end 2024 with approximately $265 million in cash and investments, which is likely to fund operations into the fourth quarter of 2026.
Nektar Therapeutics Price and Consensus
Nektar Therapeutics price-consensus-chart | Nektar Therapeutics Quote
NKTR’s Zacks Rank & Stocks to Consider
Nektar currently carries a Zacks Rank #3 (Hold).
Some better-ranked pharma stocks are Allogene Therapeutics (ALLO - Free Report) and Novartis (NVS - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Allogene Therapeutics’ loss estimates have remained constant at $1.41 per share for 2024 over the past 60 days, while that for 2025 has narrowed from $1.46 to $1.45 per share. ALLO’s shares have lost 0.6% year to date.
Allogene Therapeutics’ earnings beat estimates in three of the trailing four quarters and matched once, delivering an average surprise of 11.82%.
Novartis’ earnings estimates have risen from $7.50 to $7.56 per share for 2024 over the past 60 days, while that for 2025 has increased from $8.30 to $8.33. NVS’ shares have risen 6.1% year to date.
Novartis’ earnings beat estimates in three of the trailing four quarters and missed the same in one, delivering an average surprise of 2.22%.