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Analyst Blog

Radius Health, Inc. (RDUS - Free Report) posted a loss of $1.07 per share in the third quarter of 2016, in line with the Zacks Consensus Estimate but wider than the year-ago loss of 68 cents.

With no approved product in its portfolio, the company has not generated any revenue yet. In this scenario, investors are expected to focus on pipeline updates by the company.

Quarter in Detail

Research and development expenses for the third quarter were $27.5 million, up 50.7% year over year primarily due to higher development costs associated with the development of its pipeline candidate RAD1901, to support a phase I study in metastatic breast cancer and a phase IIb study in postmenopausal vasomotor symptoms. Expenses were also up due to higher compensation expense including stock-based compensation as a result of increased headcount.

General and administrative expenses for the reported quarter were $19.2 million, up a significant 127.5%. The increase was primarily due to higher professional support costs, including costs associated with a rise in headcount and preparations for the potential launch of abaloparatide subcutaneous (abaloparatide-SC), assuming an approval.

Pipeline Update

Radius Health’s lead candidate, abaloparatide-SC, is being developed for the treatment of postmenopausal women with osteoporosis. The candidate is currently under review in both the U.S. and the EU. The company expects an opinion from the European Medicines Agency’s Committee for Medicinal Products for Human Use later this year or next year, while a response from the FDA is anticipated by Mar 30, 2017.

The company is also developing abaloparatide-transdermal as a short wear-time transdermal patch.

During the quarter, Radius Health completed enrollment in the phase I part B expansion cohort evaluating RAD1901 for the treatment of ER+, HER2-negative advanced breast cancer. The company is also enrolling patients in the European phase I FES-PET study.

The company expects to report additional data from the ongoing phase I expansion cohort and FES-PET at the SABCS next month

Zacks Rank & Stocks to Consider

Radius Health currently has a Zacks Rank #4 (Sell). Some better-ranked stocks in the healthcare sector include Infinity Pharmaceuticals, Inc. (INFI - Free Report) , Anika Therapeutics (ANIK - Free Report) and Exelixis, Inc. (EXEL - Free Report) . All the three companies sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Infinity’s loss estimates narrowed from $3.84 to $3.79 for 2016 but remained unchanged for 2017 over the last 60 days. The company has posted a positive surprise in all of the four trailing quarters with an average beat of 67.62%.

Anika’s earnings estimates increased from $1.96 to $2.06 for 2016 and from $2.03 to $2.09 for 2017 over the last 60 days. The company has posted a positive surprise in all of the four trailing quarters with an average beat of 33.14%. Its share price has gained 8.6% year to date.

Exelixis’ loss estimates narrowed from 71 cents to 61 cents for 2016 and from a loss of 16 cents to earnings of 4 cents for 2017 over the last 60 days. The company has posted a positive surprise twice in the four trailing quarters with an average beat of 9.1%. Its share price has surged more than 80% year to date.

RADIUS HEALTH Price, Consensus and EPS Surprise

 

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