It has been about a month since the last earnings report for VIVUS, Inc. . Shares have lost about 14.1% in that time period, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
VIVUS Beats on Fourth Quarter Earnings, Revenues Increase
VIVUS reported earnings of $0.54 per share in the fourth quarter of 2016 against a loss of $0.12 in the year-ago period. Earnings beat the Zacks Consensus Estimate of a loss of $0.09 by 700%.
Quarterly revenues increased 434.6% to $81.8 million from the year-ago period. The increase in top line was due to a one-time $70 million license fee from Metuchen Pharmaceuticals for commercialization rights of Stendra.
Quarter in Detail
Qsymia generated net product sales of $11 million, down 21.4% from the year-ago period due to obesity market challenges. Vivus management said that the anti-obesity pharmaceutical market, including Qsymia, declined 10% sequentially in the fourth quarter.
Net revenue per prescription, excluding free trial offers, was approximately $121 for Qsymia less than $124 in the fourth quarter of last year.
Qsymia sales have been lackluster to date. The uptake has been slow due to high out-of-pocket cost burden for patients owing to lack of reimbursement for the product. However, VIVUS is working on boosting Qsymia sales by expanding reimbursement and promotional initiatives.
Supply and royalty revenues from Stendra/Spedra were $1.4 million, down 1% from the year-ago period due to a decrease of 56% in royalty revenues. Royalty revenues declined as the company no longer receives royalty revenue from net sales of Stendra in the U.S., beginning in the fourth quarter of 2016.
General and administrative expense was $9.3 million, up 82.3% year over year mainly due to an increase in consulting expense, one-time cost related to the Metuchen license agreement and legal fees. Selling and marketing expense was $3.8 million, much less than $8.6 million in the year-ago period primarily due to the realignment of sales force, refinement of marketing and promotional programs and continued cost control initiatives.
Research and development expense decreased 45.45% to $1.8 million in the reported quarter due to the timing of clinical projects to support Qsymia post-marketing requirements.
Other Updates
In Jan 2017, VIVUS entered into a settlement agreement with Hetero, granting the latter a license to manufacture and commercialize a generic version of Stendra no earlier than Oct 29, 2024. Hetero had previously filed an abbreviated new drug application (ANDA) to get approval to market a generic version of Stendra.
At the call, the company also mentioned that it has hired Aquilo Partners in March to help identify and acquire new product pipeline programs.
Full-Year 2016 Results
Full year 2016 earnings per share were $0.22 per share against the Zacks Consensus Estimate of a loss of $0.41. In the year-ago period, the company had reported a loss of $0.90.
Full year 2016 revenues came in at $124.3 million of which $69.4 million came from Metuchen as licensing fees. Last year’s revenues were $95.4 million.
2017 Outlook
Research and development expenses are expected to increase in 2017 as the company supports the Qsymia post-marketing requirements and begins development of tacrolimus.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VGM Scores
Currently, VIVUS' stock has a strong Growth Score of 'A', though it is lagging a bit on the momentum front with a 'C'. However, the stock was allocated a grade of 'A' on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'A'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth and value investors than momentum investors.
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
Image: Bigstock
VIVUS (VVUS) Down 14.1% Since Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for VIVUS, Inc. . Shares have lost about 14.1% in that time period, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
VIVUS Beats on Fourth Quarter Earnings, Revenues Increase
VIVUS reported earnings of $0.54 per share in the fourth quarter of 2016 against a loss of $0.12 in the year-ago period. Earnings beat the Zacks Consensus Estimate of a loss of $0.09 by 700%.
Quarterly revenues increased 434.6% to $81.8 million from the year-ago period. The increase in top line was due to a one-time $70 million license fee from Metuchen Pharmaceuticals for commercialization rights of Stendra.
Quarter in Detail
Qsymia generated net product sales of $11 million, down 21.4% from the year-ago period due to obesity market challenges. Vivus management said that the anti-obesity pharmaceutical market, including Qsymia, declined 10% sequentially in the fourth quarter.
Net revenue per prescription, excluding free trial offers, was approximately $121 for Qsymia less than $124 in the fourth quarter of last year.
Qsymia sales have been lackluster to date. The uptake has been slow due to high out-of-pocket cost burden for patients owing to lack of reimbursement for the product. However, VIVUS is working on boosting Qsymia sales by expanding reimbursement and promotional initiatives.
Supply and royalty revenues from Stendra/Spedra were $1.4 million, down 1% from the year-ago period due to a decrease of 56% in royalty revenues. Royalty revenues declined as the company no longer receives royalty revenue from net sales of Stendra in the U.S., beginning in the fourth quarter of 2016.
General and administrative expense was $9.3 million, up 82.3% year over year mainly due to an increase in consulting expense, one-time cost related to the Metuchen license agreement and legal fees. Selling and marketing expense was $3.8 million, much less than $8.6 million in the year-ago period primarily due to the realignment of sales force, refinement of marketing and promotional programs and continued cost control initiatives.
Research and development expense decreased 45.45% to $1.8 million in the reported quarter due to the timing of clinical projects to support Qsymia post-marketing requirements.
Other Updates
In Jan 2017, VIVUS entered into a settlement agreement with Hetero, granting the latter a license to manufacture and commercialize a generic version of Stendra no earlier than Oct 29, 2024. Hetero had previously filed an abbreviated new drug application (ANDA) to get approval to market a generic version of Stendra.
At the call, the company also mentioned that it has hired Aquilo Partners in March to help identify and acquire new product pipeline programs.
Full-Year 2016 Results
Full year 2016 earnings per share were $0.22 per share against the Zacks Consensus Estimate of a loss of $0.41. In the year-ago period, the company had reported a loss of $0.90.
Full year 2016 revenues came in at $124.3 million of which $69.4 million came from Metuchen as licensing fees. Last year’s revenues were $95.4 million.
2017 Outlook
Research and development expenses are expected to increase in 2017 as the company supports the Qsymia post-marketing requirements and begins development of tacrolimus.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VIVUS, Inc. Price and Consensus
VIVUS, Inc. Price and Consensus | VIVUS, Inc. Quote
VGM Scores
Currently, VIVUS' stock has a strong Growth Score of 'A', though it is lagging a bit on the momentum front with a 'C'. However, the stock was allocated a grade of 'A' on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'A'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth and value investors than momentum investors.
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.