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Achillion (ACHN) Reports Wider-than-Expected Loss in Q1

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Achillion Pharmaceuticals, Inc. reported a loss of 15 cents per share in the first quarter, wider than the Zacks Consensus Estimate of a loss of 8 cents. In the year-ago quarter, the company had reported a loss of 13 cents per share.

The company generated no revenues in the reported quarter. The company also had no revenues in the year-ago quarter.

Shares of Achillion gained almost 7.8% on May 5, in spite of the company reporting wider-than-expected loss for the first quarter of 2017 a day before. However, the stock has underperformed the Zacks classified Medical-Biomed/Genetics industry year to date. The company’s shares lost 10.2% whereas the industry registered an increase of 3.9%.

Research and development expenses increased 16.5% from the year-ago period to $15.5 million due to increased clinical trial and consulting costs related to pipeline candidate ACH-4471. The increase in expenses also included preclinical and manufacturing costs related to next generation factor D inhibitor compounds in development.

General and administrative expenses were up 5.56% to $5.7 million due to an increase in corporate legal fees and consulting fees.

Pipeline Update

During the quarter, Achillion was granted a patent to compositions of matter for compounds that inhibit complement factor D activity. Also, U.S. Patent and Trademark Office (USPTO) issued notices of allowance of four additional U.S. patent applications owned by Achillion, which are expected to be issued as patents over the next few months.

The company initiated a phase II study evaluating its key pipeline candidate, a factor D inhibitor, ACH-4471 for the treatment of patients with paroxysmal nocturnal hemoglobinuria (PNH). Subsequent to the quarter, in April, Achillion initiated patient dosing in the phase II study of ACH-4471 and recently completed 28 days of dosing. The patients will receive up to two additional months of therapy. The company plans to present interim results in a future medical conference

Also, Achillion announced additional results from Johnson & Johnson’s (JNJ - Free Report) Janssen-sponsored phase II study. The data demonstrated that the triple combination of simeprevir, odalasvir and AL-335 has the ability to shorten treatment duration in patients whose disease is caused by hepatitis C virus (HCV) genotype 1 (GT1).

Zacks Rank & Key Picks

Achillion currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include BioTime, Inc. and Celsion Corp. . Each of these stock carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

BioTime’s loss estimates narrowed 60.9% over the last 60 days to 18 cents for 2017. The company posted a positive earnings surprise in two of the four trailing quarters with an average beat of 12.32%. Its shares have increased 10.3% in the last one year.

Celsion’s loss estimates narrowed 42.9% to 28 cents for 2017 over the last 60 days. The company posted a positive earnings surprise in two of the four trailing quarters with an average beat of 0.24%.

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