Seattle Genetics, Inc.
reported second quarter 2013 net loss per share of 6 cents,
narrower than the Zacks Consensus Estimate of a loss of 18 cents
and the year-ago loss of 15 cents per share.
Second quarter revenues were $73.6 million, compared with
$48.8 million in the year-ago quarter. Revenues surpassed the
Zacks Consensus Estimate of $57 million.
Net revenues for the second quarter included Adcetris revenues
(up 3% to $35.7 million), collaboration and license agreement
revenues (up 165.9% to $34.3 million) and royalty revenues (up
185.9% to $3.5 million).
Research and development expenses increased 22.3% year over
year to $52.3 million driven by Adcetris development activities
and higher investment in other antibody-drug conjugate (ADC)
programs. Selling, general and administrative (SG&A) expenses
rose by 18.5% year over year to $23.5 million. SG&A expenses
increased due to Adcetris-related sales and marketing
Seattle Genetics is working on expanding Adcetris' label. In
May 2013, Seattle Genetics submitted a supplemental biologics
license application (sBLA) for the use of Adcetris in the
retreatment of patients and for extended duration of use beyond
16 cycles of therapy. The U.S. Food and Drug Administration (FDA)
did not approve Adcetris in this retreatment setting. Seattle
Genetics will further interact with the FDA regarding the new
data required for approval.The FDA has asked to remove the
limitation of 16-cycles timeframe from the label.
Adcetris is approved for the treatment of relapsed or
refractory Hodgkin lymphoma (HL) and systemic anaplastic large
cell lymphoma (sALCL).
Meanwhile, Seattle Genetics discontinued the development of
ASG-5ME (phase I) for prostate, gastric and pancreatic
Seattle Genetics has collaborations with various companies for
the development of ADCs. ADC collaborators are progressing on
Seattle Genetics and
entered into an alliance in Jun 2013. This deal will allow Bayer
to gain worldwide rights to Seattle Genetics' auristatin-based
ADC technology along with antibodies to several oncology
Seattle Genetics increased its 2013 collaboration and license
agreement revenue guidance from $65-$75 million to $85- $95
Second quarter results were mainly driven by collaboration and
license agreement revenues, forming 46.6% of total revenues. With
Adcetris generating $35.7 million of revenues this quarter ($69.6
million in six months), Seattle Genetics is on track to achieve
its revenue guidance of $130 million to $140 million by the end
of 2013. We expect investor focus to remain on the sales ramp up
of the drug. Adcetris' label expansion, pipeline advancement and
ADC collaborations will drive future growth.
Seattle Genetics currently carries a Zacks Rank #3 (Hold).
Right now, companies like
Actelion Ltd. (
Avanir Pharmaceuticals, Inc. (
look more attractive with a Zacks Rank #1 (Strong Buy).
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SEATTLE GENETIC (SGEN): Free Stock Analysis
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