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ChemoCentryx (CCXI) Q3 Loss Narrower Than Expected, Sales Top

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ChemoCentryx Inc. (CCXI - Free Report) reported third-quarter 2021 loss of 32 cents per share, narrower than the Zacks Consensus Estimate of a loss of 46 cents and the year-ago quarter loss of 35 cents.

It recorded revenues of $17.7 million, which beat the Zacks Consensus Estimate of $14.7 million and increased from $5.1 million in the year-ago quarter.

Last month, ChemoCentryx received FDA approval for its lead candidate, avacopan, as an adjunctive treatment combined with standard therapy for two main forms of anti-neutrophil cytoplasmic autoantibody (ANCA)-associated vasculitis — granulomatosis with polyangiitis and microscopic polyangiitis. The drug will be marketed under the brand name Tavneos. Tavneos is also the company’s first drug to receive FDA approval.

Shares of the company have plunged 38.6% year to date compared with the industry’s 12.4% decline.

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Quarter in Detail

Collaboration and license revenues from related parties were $17.69 million for the reported quarter compared with $5 million in the year-ago period. This increase was owing to a $20-million milestone payment received by the company from Vifor Pharma, following the approval of Tavneos for the treatment of ANCA-associated vasculitis or AAV in Japan.

The company recorded grant revenues of $0.05 million for the quarter.

Research & development (R&D) expenses were $20 million, up from $18.6 million in the year-ago quarter, primarily attributable to the manufacture of commercial drug supply in anticipation of the launch of avacopan for AAV treatment. R&D expenses also increased due to higher research and drug discovery expenses, including those associated with the development of its orally administered immune checkpoint inhibitor, CCX559.

General and administrative expenses were $19.6 million, up from $10.4 million in the year-ago quarter due to higher employee-related costs.

The company had $371.5 million in cash, cash equivalents and investments as of Sep 30, 2021.

Pipeline Updates

Following the FDA approval for Tavneos for AAV treatment, it commercially launched the drug in October. The company will primarily focus on patient access for Tavneos in the initial few quarters of its commercial launch. Tavneos also received approval for a similar indication in Japan earlier in September.

The company also filed regulatory applications for Tavneos for AAV treatment in the EU and anticipates a regulatory opinion from the Committee for Human Medicinal Products in November 2021.

Apart from ANCA vasculitis, the company is also studying avacopan across other autoimmune and inflammatory indications. ChemoCentryx plans to schedule a meeting with the FDA to discuss the phase III development of avacopan in patients with Hurley Stage 3 (severe) hidradenitis suppurativa, with a goal of initiating a phase III study in this patient population.

The company also plans to schedule a meeting with the FDA to discuss evidence of clinical benefit from the ACCOLADE study evaluating avacopan as a potential treatment of C3 Glomerulopathy, a very rare kidney disorder.

ChemoCentryx plans to initiate clinical development of avacopan in patients with lupus nephritis in mid-2022.

Zacks Rank & Stocks to Consider

ChemoCentryx currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the overall healthcare sector include Alkermes (ALKS - Free Report) , Endo International (ENDP - Free Report) and Regeneron Pharmaceuticals (REGN - Free Report) , each carrying a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Alkermes’ earnings per share estimates for 2021 have increased from $0.61 to $0.68 in the past 60 days. The same for 2022 has risen from $1.06 to $1.11 in the past 60 days. The stock has rallied 24.5% in the year so far.

Endo’s earnings per share estimates for 2021 have increased from $2.29 to $2.75 in the past 60 days. The same for 2022 has risen from $2.24 to $2.46 over the same period.

Regeneron’s earnings per share estimates for 2021 have increased from $55.31 to $63.43 in the past 60 days. The same for 2022 has risen from $44.84 to $47.11 over the same period. The stock has rallied 27.5% in the year so far.