Credit: Shutterstock photoSynta Pharmaceuticals Corp.SNTA reported third-quarter 2015 loss of 13 cents per share, narrower than the Zacks Consensus Estimate of a loss of 16 cents and the year-ago loss of 19 cents per share.
With no approved product in its portfolio, the company does not generate revenues yet.
In the third quarter of 2015, research and development expenses were $14.4 million, down 11.1% from the year-ago quarter. General and administrative expenses were down 8% year over year to $3 million.
Restructuring Initiatives
The company announced restructuring initiatives that are expected to be substantially completed by the fourth quarter of 2015. As part of these plans, Synta plans to reduce its workforce by approximately 60% to 33 employees. This move is expected to yield annual savings of at least $8 million in compensation-related costs.
Outlook
Synta expects that in 2016, following the termination of the GALAXY-2 study and the completion of its restructuring initiatives, expenses related to the ganetespib program will decrease significantly.
We remind investors that in Oct 2015, Synta had terminated the phase III GALAXY-2 study evaluating ganetespib in combination with Sanofi's SNY Taxotere (docetaxel) in the second-line treatment of patients with advanced non-small cell lung cancer (NSCLC). Termination of the GALAXY-2 study on ganetespib for NSCLC has been a huge setback for Synta since it is the only late-stage candidate at the company. The company decided to discontinue the GALAXY-2 study after the Independent Data Monitoring Committee concluded that the addition of ganetespib to Taxotere is unlikely to demonstrate a statistically significant improvement in the overall survival (primary endpoint) compared to Taxotere alone.
Meanwhile, Synta continues to develop ganetespib for other indications including breast cancer, ovarian cancer and acute myeloid leukemia. The company has several early-stage candidates in its pipeline.
Synta carries a Zack Rank #2 (Buy). Other well-ranked stocks in the health care sector include Anika Therapeutics Inc. ANIK and Baxalta Incorporated BXLT . Both companies sport a Zack 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.
