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Avita (RCEL) Falls 19% on Lowered 2023 Revenue Guidance
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Avita Medical (RCEL - Free Report) , a commercial-stage company, announced that it has lowered the revenue guidance for 2023 due to a processing issue of the expanded label applications through the customer’s Value Analysis Committee (VAC) for its Recell System.
The company now expects total revenues for 2023 in the band of $49.5-$50.5 million, with lower and upper bounds indicating year-over-year growth rates of approximately 45% and 48%, respectively. Previously, the company had guided the total revenues for 2023 in the $51-$53 million range.
Shares of RCEL declined 18.9% on Tuesday, in response to the news. Year to date, shares of the company have surged 54.1% against the industry’s 12.6% decline.
Image Source: Zacks Investment Research
Avita’s Recell System is a device that allows doctors to produce a suspension of spray-on skin cells using a small sample of the patient’s own skin for the treatment of acute thermal burns.
In June 2023, the FDA expanded the label of RCEL’s Recell System to treat patients with full-thickness skin defects based on positive results from the company's pivotal study for soft tissue repair and reconstruction. Post approval, a commercial launch was commenced.
Due to the wider range of potential uses after expansion into the new indication, more doctors within hospitals got engaged in the VAC process, leading to longer hospital approval timelines.
However, management believes that once completed, the VAC process will yield positive approvals and an expanded market opportunity, which is expected to be greater than 10 times the size of the burn market.
Avita first received FDA approval for its Recell System in 2018 for the treatment of acute thermal burns in patients aged 18 and older, commencing commercialization in early 2019. Later, the FDA expanded the use of the Recell System to be used in combination with meshed autografting for acute full-thickness thermal wounds in pediatric and adult patients.
Notably, in February 2022, the FDA approved an easier-to-use version of the company’s Recell System that was modified to reduce set-up steps by approximately one-third and enable the use of the device with reduced support personnel.
Also in June 2023, the FDA approved the Recell System to be used for the repigmentation of stable depigmented vitiligo lesions. The approval of Recell in this expanded indication is the first FDA-approved therapeutic device offering a one-time treatment at the point of care.
With the help of this device, doctors prepare and deliver autologous skin cells from pigmented skin to stable depigmented areas, offering a safe and effective treatment for vitiligo.
In the past 30 days, the Zacks Consensus Estimate for Ligand’s 2023 earnings per share has remained constant at $5.10. During the same time frame, the estimate for Ligand’s 2024 earnings per share has remained constant at $4.59. Year to date, shares of LGND have lost 12.5%.
LGND’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 67.19%.
In the past 30 days, the Zacks Consensus Estimate for Acadia’s 2023 loss per share has narrowed from 37 cents to 34 cents. The estimate for Acadia’s 2024 earnings per share is pegged at 90 cents. Year to date, shares of ACAD have shot up 41%.
ACAD beat estimates in two of the trailing four quarters, missing the mark on the other two occasions, delivering an average earnings surprise of 20.69%.
In the past 30 days, the Zacks Consensus Estimate for Agenus’ 2023 loss per share has narrowed from 77 cents to 63 cents. During the same time frame, the estimate for Agenus’ 2024 loss per share has narrowed from 70 cents to 45 cents. Year to date, shares of AGEN have plunged 71.6%.
AGEN beat estimates in one of the trailing four quarters, matching in one and missing the mark on the other two occasions, delivering an average earnings surprise of 0.49%.
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Avita (RCEL) Falls 19% on Lowered 2023 Revenue Guidance
Avita Medical (RCEL - Free Report) , a commercial-stage company, announced that it has lowered the revenue guidance for 2023 due to a processing issue of the expanded label applications through the customer’s Value Analysis Committee (VAC) for its Recell System.
The company now expects total revenues for 2023 in the band of $49.5-$50.5 million, with lower and upper bounds indicating year-over-year growth rates of approximately 45% and 48%, respectively. Previously, the company had guided the total revenues for 2023 in the $51-$53 million range.
Shares of RCEL declined 18.9% on Tuesday, in response to the news. Year to date, shares of the company have surged 54.1% against the industry’s 12.6% decline.
Image Source: Zacks Investment Research
Avita’s Recell System is a device that allows doctors to produce a suspension of spray-on skin cells using a small sample of the patient’s own skin for the treatment of acute thermal burns.
In June 2023, the FDA expanded the label of RCEL’s Recell System to treat patients with full-thickness skin defects based on positive results from the company's pivotal study for soft tissue repair and reconstruction. Post approval, a commercial launch was commenced.
Due to the wider range of potential uses after expansion into the new indication, more doctors within hospitals got engaged in the VAC process, leading to longer hospital approval timelines.
However, management believes that once completed, the VAC process will yield positive approvals and an expanded market opportunity, which is expected to be greater than 10 times the size of the burn market.
Avita first received FDA approval for its Recell System in 2018 for the treatment of acute thermal burns in patients aged 18 and older, commencing commercialization in early 2019. Later, the FDA expanded the use of the Recell System to be used in combination with meshed autografting for acute full-thickness thermal wounds in pediatric and adult patients.
Notably, in February 2022, the FDA approved an easier-to-use version of the company’s Recell System that was modified to reduce set-up steps by approximately one-third and enable the use of the device with reduced support personnel.
Also in June 2023, the FDA approved the Recell System to be used for the repigmentation of stable depigmented vitiligo lesions. The approval of Recell in this expanded indication is the first FDA-approved therapeutic device offering a one-time treatment at the point of care.
With the help of this device, doctors prepare and deliver autologous skin cells from pigmented skin to stable depigmented areas, offering a safe and effective treatment for vitiligo.
Avita Medical Inc. Price and Consensus
Avita Medical Inc. price-consensus-chart | Avita Medical Inc. Quote
Zacks Rank and Stocks to Consider
Avita currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks worth mentioning are Ligand Pharmaceuticals (LGND - Free Report) , Acadia Pharmaceuticals (ACAD - Free Report) and Agenus (AGEN - Free Report) . While LGND sports a Zacks Rank #1 (Strong Buy), ACAD and AGEN 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 remained constant at $5.10. During the same time frame, the estimate for Ligand’s 2024 earnings per share has remained constant at $4.59. Year to date, shares of LGND have lost 12.5%.
LGND’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 67.19%.
In the past 30 days, the Zacks Consensus Estimate for Acadia’s 2023 loss per share has narrowed from 37 cents to 34 cents. The estimate for Acadia’s 2024 earnings per share is pegged at 90 cents. Year to date, shares of ACAD have shot up 41%.
ACAD beat estimates in two of the trailing four quarters, missing the mark on the other two occasions, delivering an average earnings surprise of 20.69%.
In the past 30 days, the Zacks Consensus Estimate for Agenus’ 2023 loss per share has narrowed from 77 cents to 63 cents. During the same time frame, the estimate for Agenus’ 2024 loss per share has narrowed from 70 cents to 45 cents. Year to date, shares of AGEN have plunged 71.6%.
AGEN beat estimates in one of the trailing four quarters, matching in one and missing the mark on the other two occasions, delivering an average earnings surprise of 0.49%.