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Analyst Blog

Endocyte, Inc. (ECYT - Free Report) reported a third-quarter 2016 loss of 21 cents per share, narrower than both the Zacks Consensus Estimate of a loss of 27 cents and the year-ago loss of 24 cents. The company’s shares gained 3% following the release of its quarterly results.

Collaboration revenues, on the other hand, remained flat at $33,000 during the quarter.

Quarterly Details

Research and development (R&D) expenses were down 9.1% year over year to $6 million mainly due to lower compensation expense and expenses related to the TARGET study, which is now complete. This was partially offset by higher expenses related to the EC1456 and EC1169 dose-escalation studies, and manufacturing and other research expenses related to the two candidates.

General and administrative expenses were down 21% to $3 million due to lower compensation expense and expenses related to professional fees and employee benefits.

Pipeline Update

Endocyte is focused on the development of two candidates, EC1456 and EC1169, of which both are currently in phase I studies.

The company has initiated the expansion phase of the study on EC1456 in select folate receptor-positive non-small cell lung cancer patients, identified by the companion imaging agent etarfolatide. A dose of 6.0 mg/m2 has been established as the maximum twice a week dose and is being used in the expansion phase of the study.

Upon completion of the dosing schedule, additional patients will be enrolled in a once a week dosing schedule cohort. Initially, anti-tumor response of the single agent will be evaluated. Positive results would lead to its evaluation of combination therapies in indications such as triple-negative breast cancer, ovarian cancer and endometrial cancer.

Meanwhile, EC1169 is being evaluated in a phase I study for metastatic castration-resistant prostate cancer (mCRPC). The first part of the study has been completed, and the company has started the second part, confirming 6.5 mg/m2 once a week as the maximum clinical dose. In this expansion phase of the study, two cohorts of mCRPC patients will be evaluated. While one cohort will enroll patients who had previously received a taxane-based therapy, the other will evaluate taxane-naïve patients.

The primary endpoint of the study is radiographic progression-free survival in patients selected as PSMA-positive. Patient PSMA status will be determined using an investigational companion imaging agent, EC0652.

Efficacy and safety data from the expansion cohorts for both EC1456 and EC1169 will be reported at medical conferences in the first half of 2017.

2016 Outlook Updated

Endocyte has revised its cash balance guidance. The company now expects cash balance to be above $135 million at the end of 2016 (previous projection: above $130 million).

ENDOCYTE INC Price, Consensus and EPS Surprise

 

Zacks Rank & Stocks to Consider

Endocyte is a Zacks Rank #3 (Hold) stock. Some better-ranked stocks in the health care sector include Exelixis, Inc. (EXEL - Free Report) , Infinity Pharmaceuticals, Inc. (INFI - Free Report) and Anika Therapeutics Inc. (ANIK - Free Report) . While Anika sports a Zacks Rank #1 (Strong Buy), both Infinity and Exelixis carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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 approximately 19% year to date.

Exelixis’ loss estimates narrowed from 71 cents to 51 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 trailing four quarters with an average beat of 38.52%. Its share price has skyrocketed above 150% year to date.

Infinity’s loss estimates narrowed from $3.84 to $3.79 for 2016 over the last 60 days. The company has posted a positive surprise in all of the four trailing quarters with an average beat of 28.38%.

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