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Deciphera (DCPH) Q1 Earnings Match Estimates, Sales Miss

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Deciphera Pharmaceuticals, Inc. (DCPH - Free Report) reported a first-quarter 2023 loss of 60 cents per share, which was in line with the Zacks Consensus Estimate. In the year-ago quarter, DCPH had reported a loss of 80 cents per share.

Total net revenues were $33.4 million in the quarter, missing the Zacks Consensus Estimate of $35 million. Revenues rose 15% year over year.

Shares of Deciphera have rallied 31% in the year so far against the industry’s decline of 6.2%.

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Deciphera’s sole marketed drug is Qinlock (ripretinib), which was approved by the FDA in 2020 to treat adult patients with advanced gastrointestinal stromal tumors (GIST). These patients received prior treatment with three or more kinase inhibitors, including Novartis’ Gleevec (imatinib). Qinlock was approved in Europe in late 2021. Apart from Qinlock, there is no marketed drug in Deciphera’s portfolio.

Quarter in Detail

Total revenues comprised net product revenues and collaboration revenues. Net product revenues from Qinlock sales were $33.2 million, up 15.3% year over year. Qinlock generated $24.6 million in sales in the United States and $8.6 million in sales in the ex-U.S. markets.

Collaboration revenues in the reported quarter were $0.2 million compared with $0.4 million recorded in the year-ago quarter.

Research and development expenses were $54.8 million, up 15.5% year over year owing to costs related to clinical studies on vimseltinib and Qinlock.

Selling, general and administrative expenses were $31.4 million, up 11% year over year owing to increased professional and consultant feespartially offset by a decrease in personnel-related costs.

Deciphera had cash, cash equivalents and investments worth $426.3 million as of Mar 31, 2023, compared with $339.0 million as of Dec 31, 2022. Deciphera expects its current cash balance together with the anticipated product, royalty and supply revenues, excluding any potential future milestone payments under its collaboration or license agreements, to fund its operating and capital expenditures into 2026.

Other Updates

Deciphera is also working to expand the label of Qinlock for the larger commercial opportunity in GIST. 

In March 2023, Deciphera announced that the FDA has granted Breakthrough Therapy Designationfor its drug Qinlock for treating second-line GIST patients with mutations in KIT Exon 11 and 17/18. The breakthrough therapy designation is based on data from the ctDNA analysis of the INTRIGUE phase III study which demonstrated Qinlock’s clinical benefit for the above-mentioned patient population. Management claims that Qinlock could become the standard of care for second-line GIST patients globally subject to its approval.

Based on the results from the ctDNA analysis of phase III INTRIGUE study data, the company is also planning to initiate the pivotal phase III INSIGHT study to evaluate Qinlock versus sunitinib for the treatment of second-line GIST patients with mutations in KIT exon 11 and 17/18, later in 2023.

In the same press release, the company also announced that  Qinlock has been included in the latest National Comprehensive Cancer Network Clinical Practice Guidelines in Oncology as a preferred treatment therapy for second-line GIST patients intolerant to sunitinib.

Deciphera is evaluating another candidate, vimseltinib in the phase III MOTION study to treat patients with tenosynovial giant-cell tumors, who are not amenable to surgery. Enrollment in the study stands completed, expecting to report results from the study in the fourth quarter of 2023.

This apart, DCPH, in collaboration with Pfizer, Inc. (PFE - Free Report) expects to initiate new combination escalation studies evaluating DCC-3116 in combination withripretinib in patients with GIST and incombination with encorafenib and cetuximab in patients with colorectal cancer, in the second half of 2023. Per the terms of the agreement with Pfizer, Deciphera will bear the cost of the study while Pfizer will supply encorafenib free of cost.

Additionally, Deciphera also expects to initiate one or more expansion cohorts in the ongoing phase I/II study of DCC-3116 in the second half of 2023, in combination with either trametinib, binimetinib, or sotorasib. The study is currently evaluating the safety and tolerability of DCC-3116 as a single agent and in combination with trametinib to treat patients with advanced or metastatic tumors with a RAS or RAF mutation. Trametinib is an FDA-approved MEK inhibitor.

Zacks Rank and Stocks to Consider

Deciphera currently has a Zacks Rank #4 (Sell).

Some better-ranked stocks in the biotech sector are Aptinyx and ADMA Biologics (ADMA - Free Report) , both carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past 90 days, the Zacks Consensus Estimate for Aptinyx’s 2023 loss per share has narrowed from 77 cents to 47 cents. In the past year, shares of Aptinyx have fallen by 86.9%.

APTX beat estimates in each of the trailing four quarters, delivering an average earnings surprise of 6.56%.

In the past 90 days, the consensus estimate for ADMA Biologics’ 2023 loss per share has narrowed from 19 cents to 14 cents. In the past year, shares of ADMA Biologics have increased by 85.1%.

ADMA beat estimates in three out of the trailing four quarters, missing the mark on one occasion, delivering an average earnings surprise of 2.88%. 


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