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Kite Pharma Q3 Loss Betters Estimate; KTE-C19 On Track

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Kite Pharma, Inc. reported a loss of $1.49 per share in the third quarter of 2016, narrower than the Zacks Consensus Estimate of a loss of $1.68 per share but wider than the year-ago loss of 63 cents.

Third-quarter revenues came in at $7.3 million, much above the Zacks Consensus Estimate of $4.95 million and up 44.3% from the year-ago period.

Shares of the company rose around 9% on Wednesday.

KITE PHARMA INC Price and EPS Surprise

 

KITE PHARMA INC Price and EPS Surprise | KITE PHARMA INC Quote

Third-quarter revenues included $5.5 million from the amortization of deferred collaboration revenues related to the $60 million upfront payment received under the collaboration agreement with Amgen Inc. (AMGN - Free Report) in the first quarter of 2015.

KTE-C19 Poised for Launch in 2017

With no approved product in its portfolio, investor focus remains on KTE-C19, Kite’s lead pipeline candidate. KTE-C19 is being evaluated presently in five studies.

In September, the company announced encouraging top-line results from the phase II part of the ZUMA-1 pivotal study in patients with refractory diffuse large B cell lymphoma (DLBCL) including primary mediastinal B cell lymphoma (PMBCL) and transformed follicular lymphoma (TFL). All these are types of aggressive non-Hodgkin’s lymphoma (NHL).

Kite expects to file a Biologic License Application (BLA) for a broader label for aggressive NHL including DLBCL, TFL and PMBCL indications, based on ZUMA-1 data and also six months follow up data (expected in the first quarter of 2017).

Kite plans to initiate a rolling submission of the BLA by the end of December this year with a targeted completion by the end of the first quarter 2017. KTE-C19 is expected to be launched in 2017. In October, the company reported positive 12-month follow-up data from the phase I portion of ZUMA-1 study at a medical meeting.

Kite is also evaluating KTE-C19 in a phase II study (ZUMA-2) in patients with relapsed/refractory mantle cell lymphoma (MCL) and in two additional pivotal studies (phase I/II) for acute lymphoblastic leukemia (ALL) - ZUMA-3 for adult ALL and ZUMA-4 for pediatric ALL, with results from all these studies due in 2017. Kite plans to move KTE-C19 into a second series of studies for additional indications and earlier lines of therapy in DLBCL patients in 2017. A phase Ib/II combination study (ZUMA-6) evaluating KTE-C19 plus Genentech’s Tecentriq (atezolizumab) in patients with chemorefractory DLBCL commenced in October.

Note that Kite inked the collaboration with Genentech, a member of the Roche Holding AG (RHHBY - Free Report) this March, with an aim to evaluate the safety and efficacy of the combination therapy.

While Kite’s research and development expenses flared up 163.6% from the year-ago period to $57.3 million in the reported quarter, general and administrative expenses were $25.0 million, 124.8% higher than the year-ago period.

Kite had approximately $477 million in cash and investments at the end of the third quarter, which it believes will carry it through the first half of 2018.

Kite carries a Zacks Rank #4 (Sell). A better-ranked stock in the healthcare sector is Anika Therapeutics Inc. (ANIK - Free Report) with a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Anika’s earnings estimates have increased 5% for 2016 and 3% for 2017 over the last 60 days. The company posted a positive earnings surprise in all of the four trailing quarters, with an average beat of 33.1%. Its share price has increased 14% year to date.

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