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Aerie (AERI) Q2 Loss Wider than Expected, Pipeline in Focus
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Aerie Pharmaceuticals, Inc. posted second-quarter 2016 loss of 87 cents per share (including stock-based compensation), wider than both the Zacks Consensus Estimate of a loss of 75 cents and the year-ago loss of 73 cents.
Being a development-stage company, Aerie has not generated any revenue from product sales yet.
Quarter in Detail
In the reported quarter, research and development (R&D) expenses (excluding stock-based compensation expense) were up 25.1% to $13.3 million. Adjusted general and administrative (SG&A) expenses escalated 25.2% to $9.4 million.
The company stated that the rise in operating expenses was primarily due to increased activities related to the phase III programs for pipeline candidates Rhopressa and Roclatan, as well as preparatory activities associated with commercialization efforts.
Pipeline Update
Aerie’s efforts to develop its pipeline have been encouraging. The company remains on track to file for a New Drug Application (NDA) for Rhopressa in the third quarter of 2016 (with an anticipated launch by the end of 2017).
Meanwhile, Aerie is evaluating Rhopressa in a phase III study, Rocket 4, which is designed to provide adequate safety data for a potential regulatory filing in the EU. Top-line 90-day efficacy data from the study are expected in the fourth quarter of 2016.
The company is evaluating another late-stage candidate, Roclatan, in two phase III studies – Mercury 1 and Mercury 2 – for its ability to lower intraocular pressure (IOP) in patients with glaucoma or ocular hypertension. Interim top-line efficacy data from Mercury 1 are expected in Sep 2016, while that from Mercury 2 are expected in the second quarter of 2017.
In addition, the company plans to conduct a phase III study (Mercury 3) in Europe, Mercury 3, which will compare Roclatan to a fixed-dose combination product marketed in the continent. This study is scheduled to commence in the first half of 2017. Meanwhile, the company continues to expect to file a NDA for Roclatan in the second half of 2017.
The wider-than-expected loss in the second quarter was disappointing. Expenses continue to rise as the company is gearing up for a potential NDA submission for Rhopressa in the third quarter of 2016.
Nevertheless, we are positive on the company’s efforts in developing its pipeline candidates. With a number of upcoming data readouts lined up for the upcoming quarters, we expect investors to remain focused on further updates by the company.
Aerie currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the health care sector are Anika Therapeutics Inc. (ANIK - Free Report) , Agenus, Inc. (AGEN - Free Report) and ANI Pharmaceuticals, Inc. (ANIP - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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Aerie (AERI) Q2 Loss Wider than Expected, Pipeline in Focus
Aerie Pharmaceuticals, Inc. posted second-quarter 2016 loss of 87 cents per share (including stock-based compensation), wider than both the Zacks Consensus Estimate of a loss of 75 cents and the year-ago loss of 73 cents.
Being a development-stage company, Aerie has not generated any revenue from product sales yet.
Quarter in Detail
In the reported quarter, research and development (R&D) expenses (excluding stock-based compensation expense) were up 25.1% to $13.3 million. Adjusted general and administrative (SG&A) expenses escalated 25.2% to $9.4 million.
The company stated that the rise in operating expenses was primarily due to increased activities related to the phase III programs for pipeline candidates Rhopressa and Roclatan, as well as preparatory activities associated with commercialization efforts.
Pipeline Update
Aerie’s efforts to develop its pipeline have been encouraging. The company remains on track to file for a New Drug Application (NDA) for Rhopressa in the third quarter of 2016 (with an anticipated launch by the end of 2017).
Meanwhile, Aerie is evaluating Rhopressa in a phase III study, Rocket 4, which is designed to provide adequate safety data for a potential regulatory filing in the EU. Top-line 90-day efficacy data from the study are expected in the fourth quarter of 2016.
The company is evaluating another late-stage candidate, Roclatan, in two phase III studies – Mercury 1 and Mercury 2 – for its ability to lower intraocular pressure (IOP) in patients with glaucoma or ocular hypertension. Interim top-line efficacy data from Mercury 1 are expected in Sep 2016, while that from Mercury 2 are expected in the second quarter of 2017.
In addition, the company plans to conduct a phase III study (Mercury 3) in Europe, Mercury 3, which will compare Roclatan to a fixed-dose combination product marketed in the continent. This study is scheduled to commence in the first half of 2017. Meanwhile, the company continues to expect to file a NDA for Roclatan in the second half of 2017.
AERIE PHARMACT Price and EPS Surprise
AERIE PHARMACT Price and EPS Surprise | AERIE PHARMACT Quote
Our Take
The wider-than-expected loss in the second quarter was disappointing. Expenses continue to rise as the company is gearing up for a potential NDA submission for Rhopressa in the third quarter of 2016.
Nevertheless, we are positive on the company’s efforts in developing its pipeline candidates. With a number of upcoming data readouts lined up for the upcoming quarters, we expect investors to remain focused on further updates by the company.
Aerie currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the health care sector are Anika Therapeutics Inc. (ANIK - Free Report) , Agenus, Inc. (AGEN - Free Report) and ANI Pharmaceuticals, Inc. (ANIP - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>