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Optimer Pharmaceuticals Inc.’s second quarter 2013 net loss (excluding special items) of 55 cents per share was narrower than the Zacks Consensus Estimate of a loss of 61 cents. Second-quarter results compared unfavourably with the year-ago earnings of a penny. Optimer’s second quarter bottom-line results were affected by lower revenues.
Revenues in the second quarter of 2013 came in at $20.1 million, down 59.7% from the year-ago quarter. The decrease in revenues was primarily due to lower contract revenues. Revenues also missed the Zacks Consensus Estimate of $22 million.
Quarter in Details
Revenues in the reported quarter included Dificid sales in the U.S. and Canada along with contract revenue of $1.1 million (down 94.8%) under the company’s collaboration agreement with Astellas Pharma Europe, a subsidiary of Astellas Pharma, Inc. . We note that the year-ago revenues were boosted by upfront and milestone payments received from Astellas Japan and Astellas Pharma Europe.
We remind investors that Dificid, Optimer’s sole marketed product, was launched in the U.S. in Jul 2011 for treating patients suffering from clostridium difficile-associated diarrhea (CDAD) -- the most common form of nosocomial, or hospital acquired, diarrhea. Dificid was launched in Canada in Jun 2012. Net sales of the drug shot up 25% to $19.0 million in the reported quarter. The increase was primarily attributable to higher demand along with a 5.6% price increase which was effective from Jan 2013.
Dificid was approved in the EU under the trade name, Dificlir, in Dec 2011. The drug was also approved in Australia for the treatment of confirmed clostridium difficile infection (CDI) in adults earlier in the year.
We note that Optimer had an exclusive two-year agreement with Cubist Pharmaceuticals (CBST - Analyst Report) to co-promote Dificid in the U.S. for the treatment of CDAD which expired last month. The duration of the deal was initially two years and was consequently scheduled to expire at the end of last month. The companies have, however, extended the co-promotion deal by up to a year. Co-promotion expenses amounted to $3.8 million during the second quarter of 2013, compared with $5.0 million in the year-ago quarter.
Selling, general and administrative (SG&A) expenses during the reported quarter were up 5.8% to $30.5 million. However, research & development (R&D) expenses were down 5.3% to $10.9 million during the period.
Cubist Eyes Optimer
Meanwhile, Cubist Pharma recently announced its intension to acquire Optimer for $10.75 per share in cash (or $535 million) in addition to a contingent value right (CVR) for each share.
Cubist Pharma’s offer price of $15.75 per share (including the contingent payment) represents a premium of 18.5% to Optimer’s closing price on Jul 30, 2013. The deal, cleared by the boards of directors of both companies, is expected to close by Dec 31, 2013. Cubist would gain full control of Dificid in the event of the merger materializing.
We now expect investor focus to stay on this news.
Optimer currently carries a Zacks Rank #3 (Hold). Meanwhile, other companies like Biogen Idec Inc. (BIIB - Analyst Report) look better positioned with a Zacks Rank #1 (Strong Buy).