Nektar (NKTR) Reports Narrower-than-Expected Q1 Loss
Nektar TherapeuticsNKTR reported a loss of 14 cents per share in the first quarter of 2015, narrower than the Zacks Consensus Estimate of a loss of 20 cents. In the first quarter of 2015, the company had posted earnings of 26 cents.
Quarterly revenues plunged 45.9% to $58.9 million. The top line included $28 million received from AstraZeneca plc AZN in April for sublicensing Moventig to ProStrakan in Europe. Revenues were, however, above the Zacks Consensus Estimate of $45 million.
Quarter in Detail
Total revenue comprised net product sales, royalty revenues, non-cash royalty revenues, license, collaboration and other revenues.
Product sales surged 76.8% to almost $14.1 million.
License, collaboration and other revenues plummeted 64.7% to $34.2 million. Nektar has a license agreement with AstraZeneca for Movantik (EU trade name: Moventig) and a collaboration agreement with Baxalta Inc. BXLT for Adynovate.
Research and development (R&D) expenses were $49.3 million primarily due to phase III studies on NKTR-181 and initiation of a phase I/II study on NKTR-214.
General and administrative (G&A) expenses were down 0.7% to $10.2 million.
Nektar reiterated its financial guidance for 2016. The company continues to expect total revenue in the range of $155-$165 million. Upfront and other milestone payments under the license agreement with AstraZeneca are projected to be approximately $40 million.
It expects royalty revenues from Movantik's sale of roughly $22 million, while non-cash royalty revenues are anticipated to be around $24 million.
Nektar is currently enrolling patients in the phase III SUMMIT-07 efficacy study on NKTR-181 for chronic low back pain. Top-line data from the study are expected in the first quarter of 2017.
In addition, the company is evaluating NKTR-214 in a phase I/II study for the treatment of solid tumors. Top-line data from the study are expected in the second half of 2016.
Nektar's first-quarter results were impressive, with the company reporting a narrower-than-expected loss and revenues surpassing expectations. We are further encouraged by Nektar's collaboration and license agreements, which should continue to drive top-line growth at the company.
Going ahead, we expect investor focus to remain on further pipeline updates by the company.
Nektar currently carries a Zacks Rank #4 (Sell). OncoMed Pharmaceuticals, Inc. OMED , with a Zacks Rank #1 (Strong Buy), is a better-ranked stock in the health care sector.
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