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FATE Q3 Earnings Beat on Lower Expenses, Revenues Fall Y/Y
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Fate Therapeutics (FATE - Free Report) reported a loss of 46 cents per share in the third quarter of 2023, narrower than the Zacks Consensus Estimate of a loss of 59 cents and the year-ago loss of 86 cents.
The loss narrowed year over year due to lower research and development (R&D) expenses.
The company earned collaboration revenues of $2 million in the third quarter, which also surpassed the Zacks Consensus Estimate of $1 million but was down from $15 million reported in the year-ago quarter.
Revenues were derived from the company’s preclinical development activities for a second collaboration candidate targeting an undisclosed solid tumor antigen under its collaboration with ONO Pharmaceutical.
R&D expenses declined 57.1% to $34.3 million in the reported quarter. G&A expenses also witnessed a decline of 12.1% to $18.9 million. The lower operating expenses were on account of a decrease in salaries and benefits, including share-based compensation expense following the company's restructuring in first-quarter 2023. R&D expenses also declined due to lower clinical study costs and demand for R&D materials and equipment.
Cash, cash equivalents and investments as of Sep 30, 2023, were $349.7 million compared with $385.2 million as of Jun 30, 2023. Fate’s continued efforts in controlling costs have significantly decreased cash utilization and is expected to extend its operating runway into the second half of 2025.
Shares of FATE have plunged 76.9% year to date compared with the industry’s decline of 20.9%.
Image Source: Zacks Investment Research
2023 Guidance
The company maintained its full-year operating expenses guidance in the range of $265-$285 million.
Year-end cash and investments are expected to exceed $300 million.
Pipeline Update
FATE is focused on the development and manufacture of universal, off-the-shelf cell products using its proprietary induced pluripotent stem cell (iPSC) product platform. Its immuno-oncology pipeline includes off-the-shelf, iPSC-derived natural killer cells and T-cell product candidates. These candidates are designed to synergize with well-established cancer therapies, including immune checkpoint inhibitors and monoclonal antibodies and to target tumor-associated antigens using chimeric antigen receptors.
Post investigational new drug-enabling, Fate has initiated patient enrollment in the phase I study of FT522, with a three-dose treatment schedule at 300 million cells per dose, during the reported quarter. The early-stage study is evaluating the safety, pharmacokinetics and activity with and without administration of a standard three-day preconditioning regimen of FT522 in combination with Rituxan (rituximab) in patients with relapsed/refractory B-cell lymphoma (BCL).
With ONO Pharmaceutical, the company is co-developing FT825/ONO-8250, a multiplexed-engineered, iPSC-derived CAR T-cell product candidate targeting human epidermal growth factor receptor 2-expressing solid tumors. In October 2023, Fate reported FDA clearance of its IND application for FT825/ONO-8250 to conduct a phase I study in patients with advanced solid tumors.
The early-stage dose-escalation study will evaluate FT825/ONO-8250 both as a single-dose monotherapy and in combination with Erbitux (cetuximab).
Also, during the third quarter, FATE reported IND-clearance of FT819 to begin early-stage clinical study in patients with systemic lupus erythematosus (SLE), including those with active lupus nephritis or active SLE without renal involvement.
In the past 30 days, the Zacks Consensus Estimate for Ligand’s 2023 earnings per share has increased from $5.09 to $5.10. During the same time frame, the estimate for Ligand’s 2024 earnings per share has increased from $4.56 to $4.59. Year to date, shares of LGND have lost 21.8%.
LGND’s earnings beat estimates in three of the trailing four quarters and missed the mark on one occasion, delivering an average surprise of 52.47%.
In the past 30 days, the Zacks Consensus Estimate for Apellis’ 2023 loss per share has widened from $4.39 to $4.59. During the same time frame, the estimate for Apellis’ 2024 loss per share has narrowed from $2.41 to $1.92. Year to date, shares of APLS have lost 9.1%.
APLS beat estimates in two of the trailing four quarters, missing the mark on the other two occasions, delivering an average negative earnings surprise of 3.91%.
In the past 30 days, the Zacks Consensus Estimate for Anixa Biosciences’ 2023 loss per share has remained constant at 32 cents. During the same time frame, the estimate for Anixa Biosciences’ 2024 loss per share has remained constant at 37 cents. Year to date, shares of ANIX have lost 32.9%.
ANIX beat estimates in each of the trailing four quarters, delivering an average earnings surprise of 26.29%.
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FATE Q3 Earnings Beat on Lower Expenses, Revenues Fall Y/Y
Fate Therapeutics (FATE - Free Report) reported a loss of 46 cents per share in the third quarter of 2023, narrower than the Zacks Consensus Estimate of a loss of 59 cents and the year-ago loss of 86 cents.
The loss narrowed year over year due to lower research and development (R&D) expenses.
The company earned collaboration revenues of $2 million in the third quarter, which also surpassed the Zacks Consensus Estimate of $1 million but was down from $15 million reported in the year-ago quarter.
Revenues were derived from the company’s preclinical development activities for a second collaboration candidate targeting an undisclosed solid tumor antigen under its collaboration with ONO Pharmaceutical.
R&D expenses declined 57.1% to $34.3 million in the reported quarter. G&A expenses also witnessed a decline of 12.1% to $18.9 million. The lower operating expenses were on account of a decrease in salaries and benefits, including share-based compensation expense following the company's restructuring in first-quarter 2023. R&D expenses also declined due to lower clinical study costs and demand for R&D materials and equipment.
Cash, cash equivalents and investments as of Sep 30, 2023, were $349.7 million compared with $385.2 million as of Jun 30, 2023. Fate’s continued efforts in controlling costs have significantly decreased cash utilization and is expected to extend its operating runway into the second half of 2025.
Shares of FATE have plunged 76.9% year to date compared with the industry’s decline of 20.9%.
Image Source: Zacks Investment Research
2023 Guidance
The company maintained its full-year operating expenses guidance in the range of $265-$285 million.
Year-end cash and investments are expected to exceed $300 million.
Pipeline Update
FATE is focused on the development and manufacture of universal, off-the-shelf cell products using its proprietary induced pluripotent stem cell (iPSC) product platform. Its immuno-oncology pipeline includes off-the-shelf, iPSC-derived natural killer cells and T-cell product candidates. These candidates are designed to synergize with well-established cancer therapies, including immune checkpoint inhibitors and monoclonal antibodies and to target tumor-associated antigens using chimeric antigen receptors.
Post investigational new drug-enabling, Fate has initiated patient enrollment in the phase I study of FT522, with a three-dose treatment schedule at 300 million cells per dose, during the reported quarter. The early-stage study is evaluating the safety, pharmacokinetics and activity with and without administration of a standard three-day preconditioning regimen of FT522 in combination with Rituxan (rituximab) in patients with relapsed/refractory B-cell lymphoma (BCL).
With ONO Pharmaceutical, the company is co-developing FT825/ONO-8250, a multiplexed-engineered, iPSC-derived CAR T-cell product candidate targeting human epidermal growth factor receptor 2-expressing solid tumors. In October 2023, Fate reported FDA clearance of its IND application for FT825/ONO-8250 to conduct a phase I study in patients with advanced solid tumors.
The early-stage dose-escalation study will evaluate FT825/ONO-8250 both as a single-dose monotherapy and in combination with Erbitux (cetuximab).
Also, during the third quarter, FATE reported IND-clearance of FT819 to begin early-stage clinical study in patients with systemic lupus erythematosus (SLE), including those with active lupus nephritis or active SLE without renal involvement.
Fate Therapeutics, Inc. Price and Consensus
Fate Therapeutics, Inc. price-consensus-chart | Fate Therapeutics, Inc. Quote
Zacks Rank and Stocks to Consider
Fate currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks worth mentioning are Ligand Pharmaceuticals (LGND - Free Report) , Apellis Pharmaceuticals (APLS - Free Report) and Anixa Biosciences (ANIX - Free Report) . While LGND sports a Zacks Rank #1 (Strong Buy), APLS and ANIX carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 30 days, the Zacks Consensus Estimate for Ligand’s 2023 earnings per share has increased from $5.09 to $5.10. During the same time frame, the estimate for Ligand’s 2024 earnings per share has increased from $4.56 to $4.59. Year to date, shares of LGND have lost 21.8%.
LGND’s earnings beat estimates in three of the trailing four quarters and missed the mark on one occasion, delivering an average surprise of 52.47%.
In the past 30 days, the Zacks Consensus Estimate for Apellis’ 2023 loss per share has widened from $4.39 to $4.59. During the same time frame, the estimate for Apellis’ 2024 loss per share has narrowed from $2.41 to $1.92. Year to date, shares of APLS have lost 9.1%.
APLS beat estimates in two of the trailing four quarters, missing the mark on the other two occasions, delivering an average negative earnings surprise of 3.91%.
In the past 30 days, the Zacks Consensus Estimate for Anixa Biosciences’ 2023 loss per share has remained constant at 32 cents. During the same time frame, the estimate for Anixa Biosciences’ 2024 loss per share has remained constant at 37 cents. Year to date, shares of ANIX have lost 32.9%.
ANIX beat estimates in each of the trailing four quarters, delivering an average earnings surprise of 26.29%.