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Celldex's Q3 Loss Narrower than Expected; Focus on Pipeline

Celldex Therapeutics, Inc.CLDX reported a third-quarter 2015 loss of 32 cents per share, narrower than the Zacks Consensus Estimate of a loss of 35 cents but a penny wider than the year-ago loss of 31 cents.

Celldex Therapeutics Inc. (CLDX) - Earnings Surprise | FindTheCompany

Total revenues in the third quarter of 2015 decreased 6.8% from the year-ago quarter to $1 million, in line with the Zacks Consensus Estimate.

The Quarter in Detail

Research and development expenses decreased 5.8% from the year-ago period to $24.7 million. General and administrative spend shot up 69.6% to $8.5 million reflecting higher personnel-related expenses and commercial planning costs for Rintega and glembatumumab vedotin.

Celldex's most advanced pipeline candidate, Rintega (also known as rindopepimut and CDX-110), is a therapeutic vaccine that is currently in a pivotal phase III study (ACT IV) for the treatment of front-line EGFRvIII positive glioblastoma multiforme (GBM) and a phase II study (ReACT) for the treatment of recurrent GBM.

Celldex expects the ACT IV study to achieve the required number of events to perform the second interim analysis in late 2015 with the analysis to occur in early 2016. We note that the study was recommended to continue following the first interim analysis by an independent Data Safety and Monitoring Board that was conducted in Jun 2015.

Meanwhile, the company intends to present an update on overall and long-term survival data from the ReACT study at the Annual Scientific Meeting of the Society for Neuro-Oncology on Nov 20, 2015.

Other pipeline candidates include glembatumumab vedotin (also known as CDX-011) and varlilumab (also known as CDX-1127).

The company continues enrolling patients in a phase IIb study (METRIC) on glembatumumab vedotin in metastatic triple negative breast cancer patients (enrolment in the EU is expected to start early next year with enrolment expected to be completed in the second half of 2016) and a phase II study in metastatic melanoma patients. The candidate is also being studied for additional indications like squamous cell lung cancer (phase II expected to begin in the first quarter of 2016), uveal melanoma and pediatric osteosarcoma.

On the other hand, varlilumab is being evaluated in several phase I/II combination studies across multiple types of cancer. Varlilumab is being evaluated in combination with Bristol-Myers Squibb Company's BMY Yervoy as well as Opdivo and Roche Holding AG's RHHBY atezolizumab (anti-PDL1 antibody) among others. Several additional phase II studies on varlilumab are being planned and the company intends to provide updates as they are initiated.

Financial Guidance

Celldex expects that its cash, cash equivalents and marketable securities will be sufficient to fund the company's operating expenses and capital expenditure requirements through 2017.

We expect investor focus to remain on Rintega and other pipeline related updates expected over the rest of 2015 and into 2016.

Celldex is a Zacks Rank #3 (Hold) stock. Actelion Ltd. ALIOF is a better-ranked stock in the health care sector carrying a Zacks Rank #1 (Strong Buy).

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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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