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Endocyte (ECYT) Reports Narrower than Expected Q1 Loss

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Endocyte, Inc . ECYT reported a first-quarter 2016 loss of 24 cents per share, narrower than both the Zacks Consensus Estimate of a loss of 26 cents and the year-ago loss of 26 cents.

The company earned collaboration revenues of $12,000 in the reported period, flat year over year.

The Quarter in Detail

Research and development (R&D) expenses were $6.5 million, down 1.3% year over year primarily due to a decrease in expenses related to the TARGET trial, which is now complete, along with lower discovery research expenses. General and administrative expenses were down 12.4% to $3.8 million due to a reduction in legal and professional fees in the reported quarter.

2016 Outlook

Endocyte continues to expect cash balance between $125 million and $130 million at the end of 2016.

Pipeline Update

Endocyte's pipeline includes vintafolide (non-small cell lung cancer/NSCLC), EC1456 (NSCLC) and EC1169 (recurrent prostate cancer).

In a phase IIb study, vintafolide, in combination with docetaxel, resulted in higher rates of hematologic and peripheral neuropathy adverse events. Hence, Endocyte has shifted focus to the development of its second-generation folate targeted agent, EC1456, in second-line NSCLC. A phase I dose-escalation study on the candidate is currently underway to determine the maximum-tolerated dose.

The company is considering two schedules for the candidate. With the determination of the maximum-tolerated dose, the company will evaluate these schedules in up to 40 second-line NSCLC patients selected by EC20 imaging with all FR-positive disease. It expects single-agent efficacy data in NSCLC on the candidate by 2016 end.

The company is also conducting a phase I dose-escalation study on EC1169 to determine its maximum-tolerated dose. After determining the maximum-tolerated dose of EC1169 (currently in a dose-escalation trial with a once-weekly schedule), the candidate will be evaluated as a single-agent therapy in advanced prostate cancer patients, who were previously treated with hormone therapy. Endocyte expects single-agent efficacy data in prostate cancer in late 2016 or 2017.

The company expects to present data from the phase I dose escalation studies on EC1456 and EC1169 later in 2016.

Our Take

Endocyte's narrower-than-expected first-quarter loss as well as its efforts on pipeline development are encouraging. 2016 is going to be a data-rich year for Endocyte and we expect investor focus on further pipeline updates from the company.

Endocyte carries a Zack Rank #3 (Hold). Some better-ranked stocks in the healthcare sector include Shire plc SHPG , Nektar Therapeutics NKTR and Mallinckrodt Public Limited Co. MNK . All three carry a Zacks Rank #2 (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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