Aduro (ADRO) Q3 Loss Narrower Than Expected, Revenues Lag

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Aduro Biotech, Inc.ADRO incurred third-quarter 2018 loss of 29 cents per share, narrower than the Zacks Consensus Estimate of a loss of 31 cents and the year-ago loss of 33 cents.

Revenues came in at $3.1 million, down 17.3% year over year due to changes in revenue recognition methodology. The top line also missed the Zacks Consensus Estimate of $4.59 million.

Shares of Aduro have plummeted 40.8% year to date, wider than the industry's decline of 19.9%.

Quarter in Detail

Research and development expenses declined 23.6% in the reported quarter to $18.7 million owing to lower expenses related to the company's pipeline candidates, namely ADU-1604 and BION-1301.

General and administrative expenses were $9.1 million, up 8.2% year over year, primarily on higher stock-based compensation expense and consulting costs.

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 distinct platforms are the live, attenuated, double-deleted (LADD) technology platform, STING pathway activator platform and the B-select monoclonal antibody platform.

Aduro's LADD platform includes candidates like 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 agreement with Janssen, a subsidiary of Johnson & Johnson JNJ , for developing ADU-214 and ADU-741.

Aduro has a collaboration and license agreement with Novartis NVS for developing its lead STING Activator candidate, ADU-S100. The same is being evaluated in a phase I program as a monotherapy on patients with cutaneously accessible metastatic solid tumors or lymphomas. Top-line data from the program is expected soon.

Aduro is also performing a phase Ib study to assess ADU-S100 in combination with Novartis' PD-1 checkpoint inhibitor, PDR001, for treating solid tumors as well as lymphomas.

Aduro's B-select monoclonal antibody platform has a number of immune modulating assets, currently in research and pre-clinical development stage. Agents from this platform, such as anti-APRIL, anti-CTLA4 and anti-PD1, exhibit promises to generate novel immunotherapy combinations. Aduro is evaluating BION-1301, an anti-APRIL antibody, in a phase I/II study for treating adult patients with relapsed or refractory multiple myeloma.

Aduro Biotech, Inc. Price, Consensus and EPS Surprise

Aduro Biotech, Inc. Price, Consensus and EPS Surprise | Aduro Biotech, Inc. Quote

Zacks Rank & Stock to Consider

Aduro currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the same sector is Gilead Sciences, Inc. GILD , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Gilead Sciences' earnings estimates have been revised 3.2% upward for 2018 and 2.3% for 2019 over the past 60 days. The stock has inched up 0.6% so far this year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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