Onyx Pharmaceuticals Inc.
) reported a loss of 49 cents per share in the fourth quarter of
2012, well below the Zacks Consensus Estimate of a loss of 84
cents. The company had, however, reported a profit of $1.44 per
share in the year-ago quarter.
Quarterly revenues were $127.9 million, well above the Zacks
Consensus Estimate of $108 million. Revenues, however, declined
from the year-ago revenues of $237 million. Year-ago revenues
included $160 million received on the sale of the Japan royalty
rights of Nexavar.
For the full year 2012, Onyx Pharma reported a loss of $3.04
per share, compared to the year-ago earnings of 24 cents per
share. Revenues were $362.2 million in 2012 compared to $447.2
million in 2011. The Zacks Consensus Estimate for 2012 was a loss
of $3.40 per share and revenues of $343 million.
Onyx Pharma's revenues include royalties received under its
) for the development and marketing of Nexavar, Kyprolis sales
and royalties on Stivarga (regorafenib).
Global Nexavar sales (excluding Japan), recorded by Bayer,
amounted to $229.1 million in the reported quarter, down 1%.
Sales growth in Asia-Pacific and Latin America was offset by
weakness in Europe.
Onyx Pharma and Bayer are looking to expand the drug's label
to boost sales. Late-stage trials with Nexavar are ongoing for
breast cancer (RESILIENCE study results due in the first half of
2013). The company also intends to file for Nexavar's approval
for thyroid cancer this year.
Kyprolis, which gained FDA approval in July 2012, became
available for ordering from wholesalers on Jul 27. Kyprolis is
off to a strong start with sales coming in at $45.3 million in
the December quarter, significantly above $18.6 million reported
in the launch quarter.
Stivarga royalty revenue came in at $8.2 million in the fourth
quarter of 2012. The oncology product, on which Onyx Pharma
receives a 20% royalty from Bayer, gained FDA approval in Sep
2012 for use in treatment-experienced metastatic colorectal
Quarterly research and development (R&D) expenses declined
2.7% to $80.3 million. Selling, general and administrative
(SG&A) expenses climbed 35.7% to $68 million due to
investment in commercial infrastructure and launch activities for
Onyx Pharma expects Nexavar net sales (excluding Japan) in the
range of $890 million - $920 million. Price increases and
increased use in liver cancer should help drive sales. Onyx
Pharma did not provide guidance for Kyprolis or Stivarga as both
products are still in the early stages of commercialization.
The company expects R&D expenses (excluding stock-based
compensation expense) in the range of $400 million to $450
million. Expense will be driven by the additional studies being
conducted with Kyprolis. SG&A expenses (excluding stock-based
compensation expense) are expected in the range of $290 million -
$320 million. Onyx Pharma expects to report a loss in 2013.
Onyx Pharma currently carries a Zacks Rank #3 (Hold). The
company has successfully transformed itself from a one-product
company to a three-product company. Kyprolis represents
significant commercial potential and its approval should remove
concerns regarding Onyx Pharma's dependence on a single product
for growth. We expect investor focus to remain on Kyprolis and
Stivarga's commercialization and pipeline updates.
Currently, companies like
Avanir Pharmaceuticals, Inc.
) look better-positioned. While United Therapeutics is a Zacks
Rank #1 (Strong Buy) stock, Avanir is a Zacks Rank #2 (Buy)
AVANIR PHARM (AVNR): Free Stock Analysis
BAYER A G -ADR (BAYRY): Free Stock Analysis
ONYX PHARMA INC (ONXX): Free Stock Analysis
UTD THERAPEUTIC (UTHR): Free Stock Analysis
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