It has been about a month since the last earnings report for Keryx Biopharmaceuticals, Inc. . Shares have added about 27.4% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Keryx Q4 Loss Wider than Expected, Revenues Beat
Keryx reported fourth-quarter 2016 loss of $0.32 per share, narrower than the year-ago loss of $0.36. However, the loss was wider than the Zacks Consensus Estimate of a loss of $0.27 per share.
Revenues came in at $9.53 million in the quarter, marginally exceeding the Zacks Consensus Estimate of $9.5 million. Further, reported revenues improved from the prior-year figure of $5.8 million.
Quarter in Details
Net sales of Auryxia in the U.S. were $8.2 million, up 70.8%, despite the three-month supply interruption from Aug to Nov 2016. We remind investors that in August 2016, Keryx announced an interruption in the supply of Auryxia, as its contract manufacturer had issues related to the conversion of the API into the finished product, leading to a disruption in the supply of Auryxia.
Consequently, the company withdrew its guidance for 2016. However, in Nov 2016, Keryx announced that the FDA has approved a second drug product manufacturer, Patheon Manufacturing Services, for supplying Auryxia as a finished product.
Auryxia’s prescriptions were filled during the quarter were 8,700, which included about 4,500 prescriptions written in the month of December. Notably, it was the first full month of sales post resupply of Auryxia. In Jan 2017, Auryxia prescriptions increased 3.3%, even though the overall market for phosphate binder prescriptions declined by 2.6%.
License revenues came in at $1.3 million, up 30% year over year. Keryx earns license revenues from royalties on net sale of Riona (Japan trade name for Auryxia) from its Japanese partners, Japan Tobacco Inc. and Torii Pharmaceutical Co. Ltd.
Research and development expenses declined 22.5% year over year to $6.2 million, primarily due to a decrease in development work at the company’s contract manufacturers following approval of a second drug product contract manufacturer. Further, it was affected by a decline in clinical costs following the completion of phase III clinical trial in early 2016.
Selling, general and administrative expenses were $23 million, up 6.5% due to expansion of sales force to support commercialization of Auryxia.
Meanwhile, Keryx is working on expanding Auryxia's label to include the treatment of iron-deficiency anemia (IDA) in adults with non-dialysis dependent chronic kidney disease. The company filed a supplemental new drug application (sNDA) with the FDA in Jan 2017. Auryxia is expected to be approved for the label expansion and launched in late 2017. If approved for this indication, Auryxia could be the first FDA-approved oral medicine to treat IDA in this patient population.
2016 Results
For 2016, loss was $1.52 per share, as compared with $ $1.19 in 2015. The loss was wider than the Zacks Consensus Estimate of a loss of $1.47 per share.
Revenues in 2016 came in at $32 million, up whopping 133.8% from $13.7 million in 2015. Further, revenues beat the Zacks Consensus Estimate of $31.95 million.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one downward revision for the current quarter. In the past month, the consensus estimate also shifted downward by 12% due to these changes.
VGM Scores
At this time, Keryx's stock has a nice Growth Score of 'B', though it is lagging a lot on the momentum front with an 'F'. Following the exact same course, the stock was allocated also a grade of 'F' on the value side, putting it in the fifth quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
The stock is suitable solely for growth based on our styles scores.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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Why Is Keryx (KERX) Up 27.4% Since the Last Earnings Report?
It has been about a month since the last earnings report for Keryx Biopharmaceuticals, Inc. . Shares have added about 27.4% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Keryx Q4 Loss Wider than Expected, Revenues Beat
Keryx reported fourth-quarter 2016 loss of $0.32 per share, narrower than the year-ago loss of $0.36. However, the loss was wider than the Zacks Consensus Estimate of a loss of $0.27 per share.
Revenues came in at $9.53 million in the quarter, marginally exceeding the Zacks Consensus Estimate of $9.5 million. Further, reported revenues improved from the prior-year figure of $5.8 million.
Quarter in Details
Net sales of Auryxia in the U.S. were $8.2 million, up 70.8%, despite the three-month supply interruption from Aug to Nov 2016. We remind investors that in August 2016, Keryx announced an interruption in the supply of Auryxia, as its contract manufacturer had issues related to the conversion of the API into the finished product, leading to a disruption in the supply of Auryxia.
Consequently, the company withdrew its guidance for 2016. However, in Nov 2016, Keryx announced that the FDA has approved a second drug product manufacturer, Patheon Manufacturing Services, for supplying Auryxia as a finished product.
Auryxia’s prescriptions were filled during the quarter were 8,700, which included about 4,500 prescriptions written in the month of December. Notably, it was the first full month of sales post resupply of Auryxia. In Jan 2017, Auryxia prescriptions increased 3.3%, even though the overall market for phosphate binder prescriptions declined by 2.6%.
License revenues came in at $1.3 million, up 30% year over year. Keryx earns license revenues from royalties on net sale of Riona (Japan trade name for Auryxia) from its Japanese partners, Japan Tobacco Inc. and Torii Pharmaceutical Co. Ltd.
Research and development expenses declined 22.5% year over year to $6.2 million, primarily due to a decrease in development work at the company’s contract manufacturers following approval of a second drug product contract manufacturer. Further, it was affected by a decline in clinical costs following the completion of phase III clinical trial in early 2016.
Selling, general and administrative expenses were $23 million, up 6.5% due to expansion of sales force to support commercialization of Auryxia.
Meanwhile, Keryx is working on expanding Auryxia's label to include the treatment of iron-deficiency anemia (IDA) in adults with non-dialysis dependent chronic kidney disease. The company filed a supplemental new drug application (sNDA) with the FDA in Jan 2017. Auryxia is expected to be approved for the label expansion and launched in late 2017. If approved for this indication, Auryxia could be the first FDA-approved oral medicine to treat IDA in this patient population.
2016 Results
For 2016, loss was $1.52 per share, as compared with $ $1.19 in 2015. The loss was wider than the Zacks Consensus Estimate of a loss of $1.47 per share.
Revenues in 2016 came in at $32 million, up whopping 133.8% from $13.7 million in 2015. Further, revenues beat the Zacks Consensus Estimate of $31.95 million.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one downward revision for the current quarter. In the past month, the consensus estimate also shifted downward by 12% due to these changes.
Keryx Biopharmaceuticals, Inc. Price and Consensus
Keryx Biopharmaceuticals, Inc. Price and Consensus | Keryx Biopharmaceuticals, Inc. Quote
VGM Scores
At this time, Keryx's stock has a nice Growth Score of 'B', though it is lagging a lot on the momentum front with an 'F'. Following the exact same course, the stock was allocated also a grade of 'F' on the value side, putting it in the fifth quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
The stock is suitable solely for growth based on our styles scores.
Outlook
Estimates have been broadly trending downward for the stock. The magnitude of this revision also looks promising. Notably, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.