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Aduro (ADRO) Q4 Earnings and Revenues Fall Shy of Estimates

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Aduro BioTech, Inc.  incurred fourth-quarter 2018 loss of 33 cents per share, wider than the Zacks Consensus Estimate of a loss of 23 cents but narrower than the year-ago loss of 34 cents.

Revenues came in at $2.8 million, down 26.3% year over year due to changes in revenue recognition methodology. The top line also missed the Zacks Consensus Estimate of $5.9 million.

Shares of Aduro slipped 1.9% in after-hours trading on Wednesday. In fact, the stock has plunged 30.5% in the past year.

Quarter in Detail

Research and development expenses declined 23.1% in the reported quarter to $17.6 million owing to lower expenses related to the company’s antibody and live, attenuated, double-deleted (LADD) programs.

General and administrative expenses were $9 million, up 2.3% year over year, primarily on higher stock-based compensation expense and consulting costs.

Full-Year Result

For 2018, Aduro generated revenues of $15.1 million, down 12.2% on a year-over-year basis. The company suffered net loss of $1.21 per share in 2018.

Pipeline Update

Aduro’s three distinct technology platforms, designed to harness the body's natural immune system, are being utilized to develop treatments for several cancer indications and show potential for label expansion into auto-immune and infectious diseases. The three well-defined platforms are the LADD technology, STING pathway activator and the B-select monoclonal antibody.

Aduro has a collaboration and license agreement with Novartis (NVS - Free Report) for developing its lead STING Activator candidate, ADU-S100.

Earlier this month, Aduro dosed the first patient in a phase I study, evaluating ADU-S100 in combination with Bristol-Myers’ (BMY - Free Report) Yervoy (ipilimumab) for the treatment of relapsed/refractory melanoma.

Earlier, ADU-S100 was being evaluated as a single agent. However, the protocol was amended later to include the evaluation of ADU-S100 in combination with Yervoy on a homogeneous patient population.

Last December, Aduro entered into an exclusive collaboration and license agreement with pharma giant Eli Lilly (LLY - Free Report) to develop novel immunotherapies for autoimmune and other inflammatory diseases by leveraging its cGAS-STING inhibitor platform.

Also, in the same month, the company presented encouraging preclinical data on its first-in-class anti-APRIL antibody, BION-1301, for the treatment of multiple myeloma at the 60th American Society of Hematology Annual Meeting. The findings showed that BION-1301 with a B cell maturation antigen (BCMA) targeted therapy, might have potential to augment anti-myeloma activity, which supports the candidate’s use as a first-in-class therapy for treating multiple myeloma.

Meanwhile, Aduro’s LADD platform includes candidates, such as ADU-623 (phase I — glioblastoma), ADU-741 (phase I – metastatic castration resistant prostate cancer) and ADU-214 (phase I — metastatic non-small cell lung cancer). Aduro has a research and license deal with Janssen, a subsidiary of Johnson & Johnson for developing ADU-214 and ADU-741.

Zacks Rank

Aduro currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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