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VIR Q4 Earnings Beat on Higher Revenues From Covid Treatment

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Vir Biotechnology (VIR - Free Report) reported earnings of $3.92 per share in the fourth quarter, beating the Zacks Consensus Estimate of $2.60. In the year-ago quarter, the company reported a loss of 83 cents due to lower revenues.

The company generated revenues of $812.7 million, which beat the Zacks Consensus Estimate of $670 and surged from $1.7 million in the year-ago quarter.

Shares of Vir have lost 55.9% in the past year compared with the industry’s 37.6% decline.

Zacks Investment Research
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Quarter in Detail

Collaboration revenues in the quarter were $809.5 million and contract revenues summed $0.3 million.

The increase in collaboration revenues in the quarter was related to revenues from the company’s profit-sharing arrangement with GlaxoSmithKline (GSK - Free Report) for the sale of sotrovimab under the company’s 2020 collaboration agreement with GSK. Collaboration revenues reflect the delivery of approximately 90% of the more than 750,000 sotrovimab doses sold in 2021.

Grant revenues were $3.0 million compared with $1.4 million in the year-ago quarter. The increase was primarily due to $2.2 million of revenues recognized under the new grant agreement with the Bill & Melinda Gates Foundation to support the manufacturing and clinical activities of the company’s HIV and tuberculosis programs.

Research & development expenses in the reported quarter were $128 million, up from $87.1 million in the year-ago quarter.

Selling, general and administrative expenses were $55.8 million, up from $23.8 million in the year-ago quarter.

Pipeline Updates

We note that sotrovimab has been granted Emergency Use Authorization (EUA), temporary authorization or marketing approval (under the brand name Xevudy) in more than 40 countries for the treatment of mild-to-moderate coronavirus disease 2019 (COVID-19) in adults and pediatric patients (12 years of age and older weighing at least 40kg).

Vir and GSK plan to submit a biologics license application (BLA) for sotrovimab to the FDA in the second half of 2022.

Vir and GSK are also assessing the use of sotrovimab in uninfected immunocompromised patients to determine whether the drug can prevent symptomatic COVID-19 infection.

In December, Vir and Gilead Sciences, Inc. (GILD - Free Report) initiated a phase II study. This study is evaluating the various combinations of VIR-2218, selgantolimod (GS-9688) Gilead’s investigational TLR-8 agonist and nivolumab, an approved PD-1 inhibitor, as a potential functional cure regimen for chronic HBV infection. Vir and Gilead retain full rights to their individual product candidates and will discuss the potential path forward for any future combination studies based on the outcome of the phase II study.

Zacks Rank & A Stock to Consider

Vir currently carries a Zacks Rank #3 (Hold).   A better-ranked stock in the healthcare sector is Vertex Pharmaceuticals (VRTX - Free Report) , which at present carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Vertex’ Pharmaceuticals earnings per share estimates have increased to $15.31 from $13.85 for 2022 over the past 60 days.

The consensus estimate for 2022 earnings for Vertex has increased $1.01 over the past 30 days to $14.33. Shares of VRTX gained 10% in the past year.


 

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