Back to top

Analyst Blog

Endocyte, Inc. (ECYT - Snapshot Report) reported third quarter 2013 net loss per share of 8 cents, narrower than the Zacks Consensus Estimate of a loss of 19 cents but wider than the year-ago loss of 3 cents.

Third quarter 2013 revenues were $16.6 million compared with $12.4 million in the third quarter of 2012. Revenues comprised solely of collaboration revenues. Revenues surpassed the Zacks Consensus Estimate of $16 million.

In the reported quarter, research and development (R&D) expenses were $13.5 million, up 36.4%. Costs related to the PROCEED and TARGET trials were primarily responsible for the increase.

We note that Endocyte and Merck & Co. Inc. (MRK - Analyst Report) entered into a partnership in Apr 2012, wherein Endocyte granted Merck an exclusive license to develop, manufacture and commercialize vintafolide outside the U.S. As per the agreement, Merck is funding manufacturing costs for vintafolide, including some portion of the PROCEED and TARGET trial.

From the fourth quarter of 2013, manufacturing responsibilities have been transferred completely to Merck. So, manufacturing costs will no more appear in research and development expenses. As a result, adjusted R&D expenses for the third quarter of 2013 will come to $9.0 million, as $4.5 million will be reimbursed by Merck.

In the reported quarter, general and administrative (G&A) expenses jumped 60.5% to $6.1 million. The increase was attributable to establishing commercial capability. An increase in compensation expenses was also responsible for pushing G&A costs up. Merck is funding all patent expenses for vintafolide. Adjusting for the $0.2 million to be reimbursed by Merck, adjusted G&A expenses for the third quarter of 2013 will come to $6 million.

In 2012, Endocyte had submitted a marketing authorization application (MAA) seeking approval for vintafolide for platinum-resistant ovarian cancer. The company is also seeking EU approval for a folate-targeted molecular imaging agent, etarfolatide. Both candidates were granted orphan drug status in the EU in 2012. The company expects a decision from the European Commission on both candidates in Dec 2013 or Jan 2014.

Endocyte completed enrollment in the phase IIb TARGET study of vintafolide in non-small cell lung cancer (NSCLC) patients. Top-line data from the study is expected in the first quarter of 2014

Endocyte and Merckwill initiate a phase II randomized trial on vintafolide in folate receptor-positive triple negative breast cancer in the first half of 2014.

Endocyte is on schedule to complete enrollment in the phase III PROCEED study in the first half of 2014. Interim analysis of 250 folate receptor patients is expected in the second quarter of 2014.

For its folate-targeted tubulysin therapeutic, EC1456, an investigational new drug application was accepted by the U.S. Food and Drug Administration (FDA) in the reported quarter. Endocyte is screening patients for enrolment in a phase I study.

Endocyte carries a Zacks Rank #3 (Hold). Currently, companies like AMAG Pharmaceuticals Inc. (AMAG - Snapshot Report) and Actelion Ltd. (ALIOF) look well-positioned with a Zacks Rank #1 (Strong Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
SIGNET JEWE… SIG 116.37 +7.72%
CHYRONHEGO… CHYR 2.72 +5.84%
US SILICA H… SLCA 70.72 +4.00%
MALLINCKROD… MNK 80.11 +2.32%
RF MICRO DE… RFMD 11.76 +2.31%