Mirati Therapeutics reported a loss of $2.49 per share for third-quarter 2023, which was narrower than the Zacks Consensus Estimate of a loss of $2.92 as well as the year-ago quarter’s loss of $3.09 per share.
Mirati reported $16.4 million in revenues for the third quarter, missing the Zacks Consensus Estimate of $19.02 million. Mirati had recorded revenues of $5.4 million in the year-ago quarter.
Quarter in Detail
Third-quarter revenues comprised $16.4 million as product revenues from Krazati/adagrasib, Mirati’s new cancer drug, compared with $13.4 million in the previous quarter. The FDA approved Krazati, a KRAS G12C inhibitor, to treat adult patients with KRASG12C-mutated locally advanced or metastatic non-small cell lung cancer (NSCLC) in December 2022. No product revenues were recorded in the year-ago quarter.
So far this year, the stock price of Mirati has risen 24.5% against the industry’s 21% decline.
There were no license and collaboration revenues in the quarter compared with $5.4 million in the year-ago quarter.
Research and development expenses declined 12.4% from the prior-year quarter’s level to $114.8 million. This decrease was due to a reduction in clinical development costs for sitravatinib as the company scrapped the development of the candidate, and a decline in share-based compensation.
Selling, general and administrative expenses rose 18.4% from the year-ago quarter’s level to $72.0 million due to an increase in commercial-related costs to support the marketing and sales of Krazati and higher headcount-related costs.
Cash, cash equivalents and short-term investments as of Sep 30, 2023 were $976.4 million compared with $779.4 million as of Jun 30, 2023.
In July 2023, Bristol Myers (BMY - Free Report) offered to buy Mirati in an all-cash transaction for $58 per share, aggregating to $4.8 billion. Existing shareholders are also eligible to receive a non-tradeable contingent value right (“CVR”) per share, entitling the holder to receive an additional $12 per share. The CVR adds another $1 billion to the transaction, bringing the deal's total value up to $5.8 billion. The transaction is anticipated to close by the first half of 2024, pending approval of shareholders as well as other regulatory approvals.
Pipeline Update
A regulatory filing for Krazati is under review in Europe. In July, the European Medicine Agency’s Committee for Medicinal Products for Human Use (CHMP) gave a negative opinion regarding the granting of conditional marketing authorization to Krazati. The CHMP mentioned that though the drug has a favorable risk-benefit profile, it does not meet certain requirements for conditional approval. A re-examination of CHMP’s opinion is ongoing.
Mirati is evaluating the expanded use of adagrasib — both as monotherapy and combinations — in multiple cohorts of the phase I/II KRYSTAL-1 study across multiple solid tumors that harbor KRAS G12C mutations. These include a combination of Krazati with Merck’s (MRK - Free Report) Keytruda in NSCLC and Krazati with Bristol-Myers’ Erbitux (cetuximab) in advanced colorectal cancer (CRC). Mirati is on track to complete the supplemental new drug application for third-line and beyond CRC in patients with a KRAS G12C mutation by year-end 2023.
A phase III registrational study is also ongoing in second-line CRC called KRYSTAL-10, which compares the efficacy of Krazati in combination with Bristol-Myers’ Erbitux (cetuximab) versus standard-of-care chemotherapy. Enrollment is complete in the KRYSTAL-10 study. However, enrollment continues in the phase III KRYSTAL-12 study, which is evaluating Krazati versus docetaxel in second-line NSCLC patients. Top-line results from these studies are expected in 2024.
Last week, Mirati announced a collaboration deal with Kura Oncology (KURA - Free Report) to study a combination of KO-2806, Kura Oncology’s next-generation farnesyl transferase inhibitor (FTI), and adagrasib for KRAS G12C-mutated NSCLC. Some preclinical data showed that combining adagrasib with an FTI can lead to better patient outcomes. A phase I study of KO-2806 plus adagrasib is expected to begin dosing patients by mid-2024. While Kura will sponsor this phase I study, Mirati will supply Kura with adagrasib for the study.
Zacks Rank
Mirati currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Mirati Therapeutics reported a loss of $2.49 per share for third-quarter 2023, which was narrower than the Zacks Consensus Estimate of a loss of $2.92 as well as the year-ago quarter’s loss of $3.09 per share.
Mirati reported $16.4 million in revenues for the third quarter, missing the Zacks Consensus Estimate of $19.02 million. Mirati had recorded revenues of $5.4 million in the year-ago quarter.
Quarter in Detail
Third-quarter revenues comprised $16.4 million as product revenues from Krazati/adagrasib, Mirati’s new cancer drug, compared with $13.4 million in the previous quarter. The FDA approved Krazati, a KRAS G12C inhibitor, to treat adult patients with KRASG12C-mutated locally advanced or metastatic non-small cell lung cancer (NSCLC) in December 2022. No product revenues were recorded in the year-ago quarter.
So far this year, the stock price of Mirati has risen 24.5% against the industry’s 21% decline.
There were no license and collaboration revenues in the quarter compared with $5.4 million in the year-ago quarter.
Research and development expenses declined 12.4% from the prior-year quarter’s level to $114.8 million. This decrease was due to a reduction in clinical development costs for sitravatinib as the company scrapped the development of the candidate, and a decline in share-based compensation.
Selling, general and administrative expenses rose 18.4% from the year-ago quarter’s level to $72.0 million due to an increase in commercial-related costs to support the marketing and sales of Krazati and higher headcount-related costs.
Cash, cash equivalents and short-term investments as of Sep 30, 2023 were $976.4 million compared with $779.4 million as of Jun 30, 2023.
In July 2023, Bristol Myers (BMY - Free Report) offered to buy Mirati in an all-cash transaction for $58 per share, aggregating to $4.8 billion. Existing shareholders are also eligible to receive a non-tradeable contingent value right (“CVR”) per share, entitling the holder to receive an additional $12 per share. The CVR adds another $1 billion to the transaction, bringing the deal's total value up to $5.8 billion. The transaction is anticipated to close by the first half of 2024, pending approval of shareholders as well as other regulatory approvals.
Pipeline Update
A regulatory filing for Krazati is under review in Europe. In July, the European Medicine Agency’s Committee for Medicinal Products for Human Use (CHMP) gave a negative opinion regarding the granting of conditional marketing authorization to Krazati. The CHMP mentioned that though the drug has a favorable risk-benefit profile, it does not meet certain requirements for conditional approval. A re-examination of CHMP’s opinion is ongoing.
Mirati is evaluating the expanded use of adagrasib — both as monotherapy and combinations — in multiple cohorts of the phase I/II KRYSTAL-1 study across multiple solid tumors that harbor KRAS G12C mutations. These include a combination of Krazati with Merck’s (MRK - Free Report) Keytruda in NSCLC and Krazati with Bristol-Myers’ Erbitux (cetuximab) in advanced colorectal cancer (CRC). Mirati is on track to complete the supplemental new drug application for third-line and beyond CRC in patients with a KRAS G12C mutation by year-end 2023.
A phase III registrational study is also ongoing in second-line CRC called KRYSTAL-10, which compares the efficacy of Krazati in combination with Bristol-Myers’ Erbitux (cetuximab) versus standard-of-care chemotherapy. Enrollment is complete in the KRYSTAL-10 study. However, enrollment continues in the phase III KRYSTAL-12 study, which is evaluating Krazati versus docetaxel in second-line NSCLC patients. Top-line results from these studies are expected in 2024.
Last week, Mirati announced a collaboration deal with Kura Oncology (KURA - Free Report) to study a combination of KO-2806, Kura Oncology’s next-generation farnesyl transferase inhibitor (FTI), and adagrasib for KRAS G12C-mutated NSCLC. Some preclinical data showed that combining adagrasib with an FTI can lead to better patient outcomes. A phase I study of KO-2806 plus adagrasib is expected to begin dosing patients by mid-2024. While Kura will sponsor this phase I study, Mirati will supply Kura with adagrasib for the study.
Zacks Rank
Mirati currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>
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