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Juno (JUNO) Loss Wider; End of Cancer Drug Study Hits Stock
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Juno Therapeutics Inc. reported wider-than-expected loss in the fourth quarter of 2016. Shares of the company declined in after-hours trading as it announced that it has decided not to move forward with the ROCKET trial or cancer candidate JCAR015.
In fact, in the past one year, Juno Therapeutics' shares significantly underperformed Zacks classified Medical-Biomedical and Genetics industry. The company’s shares lost 37.7%, while the industry registered a decrease of 2.1%.
Juno reported a loss of 67 cents per share (including stock-based compensation expenses) in the fourth quarter of 2016, wider than the Zacks Consensus Estimate of a loss of 63 cents. Quarterly loss is also wider from the year-ago loss of 55 cents per share.
The development stage company reported total revenue of $21.2 million in the quarter compared with $4.2 million in the year-ago period. The top-line growth was mainly driven by revenues recognized under Juno’s collaboration agreement with Celgene Corporation . Revenues were also significantly above the Zacks Consensus Estimate of $16 million.
The company’s adjusted research and development expenses in the reported quarter increased 77.9% from the year-ago period to $73.1 million (including stock-based compensation expenses), primarily due to higher clinical development costs. General and administrative expenses amounted to $19.5 million (including stock-based compensation expenses), up 21.9% due to an increase in litigation and patent legal costs, consulting costs related to commercial readiness and personnel costs.
Pipeline Update
Juno is looking to revolutionize cancer treatment by introducing immunotherapies. The company’s pipeline candidates include JCAR015, JCAR017 and JCAR014.
However, Juno faced a major setback related to the development of its lead pipeline candidate, JCAR015. In Jul 2016, the FDA placed a clinical hold on the company’s phase II ROCKET study which was evaluating JCAR015 for the treatment of relapsed or refractory B cell acute lymphoblastic leukemia (r/r ALL) as two patients died within a week due to severe neurotoxicity after the recent addition of fludarabine to the pre-conditioning regimen.
While the hold was lifted a week later and the study resumed under a revised protocol, the company voluntarily placed the study on hold in Nov 2016. Concurrent with the quarterly result, Juno announced that it is discontinuing the development of JCAR015 for r/r ALL at this time due to the toxicity witnessed in the ROCKET trial. Instead the company said it will redirect the funds towards the development of a defined cell product candidate in the adult r/r ALL setting.
JCAR017 is in a phase I study for non-Hodgkin lymphoma (NHL) and in a phase I/II study in pediatric and young adults with r/r ALL. In Dec 2016, the company announced encouraging preliminary clinical data from the study. The data demonstrated 60% complete response in patients with relapsed or refractory aggressive cd19+ NHL.
Notably, in the same month, the FDA granted Breakthrough Therapy designation to JCAR017 for the treatment of relapsed/refractory (r/r) aggressive large B-cell non-Hodgkin lymphoma (NHL), including diffuse large B-cell lymphoma (DLBCL) and Primary Mediastinal B-cell Lymphoma (PMBCL). Further, the candidate was granted Priority Medicines (PRIME) eligibility for r/r DLBCL by the European Medicines Agency (EMA).
The company continues to work on developing the other candidates on its pipeline.
2016 Results
Full-year sales surged to $79.4 million from year-ago figure of $18.2 million. Sales surpassed the Zacks Consensus Estimate of $74.3 million.
The full-year loss of $2.69 per share was wider than Zacks Consensus Estimate of a loss of $2.63. The company had posted earnings of $1.78 per share a year ago. 2017 Guidance
Juno expects cash burn of $270–$300 million in 2017, excluding the impact of business development activities.
Juno Therapeutics, Inc. Price, Consensus and EPS Surprise
Juno Therapeutics currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include Cellectis S.A. (CLLS - Free Report) and Sunesis Pharmaceuticals, Inc. . Each of these stocks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cellectis’s loss per share estimates narrowed from $2.33 to $1.80 for 2016 and from $2.94 to $1.69 for 2017 over the last 30 days. The company posted positive surprises in three of the four trailing quarters with an average beat of 111.20%.
Sunesis’ loss per share estimates narrowed from $2.57 to $2.44 for 2016 and from $2.16 to $1.97 for 2017 over the last 60 days. The company posted positive earnings surprises in three of the four trailing quarters with an average beat of 0.54%.
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Juno (JUNO) Loss Wider; End of Cancer Drug Study Hits Stock
Juno Therapeutics Inc. reported wider-than-expected loss in the fourth quarter of 2016. Shares of the company declined in after-hours trading as it announced that it has decided not to move forward with the ROCKET trial or cancer candidate JCAR015.
In fact, in the past one year, Juno Therapeutics' shares significantly underperformed Zacks classified Medical-Biomedical and Genetics industry. The company’s shares lost 37.7%, while the industry registered a decrease of 2.1%.
Juno reported a loss of 67 cents per share (including stock-based compensation expenses) in the fourth quarter of 2016, wider than the Zacks Consensus Estimate of a loss of 63 cents. Quarterly loss is also wider from the year-ago loss of 55 cents per share.
The development stage company reported total revenue of $21.2 million in the quarter compared with $4.2 million in the year-ago period. The top-line growth was mainly driven by revenues recognized under Juno’s collaboration agreement with Celgene Corporation . Revenues were also significantly above the Zacks Consensus Estimate of $16 million.
The company’s adjusted research and development expenses in the reported quarter increased 77.9% from the year-ago period to $73.1 million (including stock-based compensation expenses), primarily due to higher clinical development costs. General and administrative expenses amounted to $19.5 million (including stock-based compensation expenses), up 21.9% due to an increase in litigation and patent legal costs, consulting costs related to commercial readiness and personnel costs.
Pipeline Update
Juno is looking to revolutionize cancer treatment by introducing immunotherapies. The company’s pipeline candidates include JCAR015, JCAR017 and JCAR014.
However, Juno faced a major setback related to the development of its lead pipeline candidate, JCAR015. In Jul 2016, the FDA placed a clinical hold on the company’s phase II ROCKET study which was evaluating JCAR015 for the treatment of relapsed or refractory B cell acute lymphoblastic leukemia (r/r ALL) as two patients died within a week due to severe neurotoxicity after the recent addition of fludarabine to the pre-conditioning regimen.
While the hold was lifted a week later and the study resumed under a revised protocol, the company voluntarily placed the study on hold in Nov 2016. Concurrent with the quarterly result, Juno announced that it is discontinuing the development of JCAR015 for r/r ALL at this time due to the toxicity witnessed in the ROCKET trial. Instead the company said it will redirect the funds towards the development of a defined cell product candidate in the adult r/r ALL setting.
JCAR017 is in a phase I study for non-Hodgkin lymphoma (NHL) and in a phase I/II study in pediatric and young adults with r/r ALL. In Dec 2016, the company announced encouraging preliminary clinical data from the study. The data demonstrated 60% complete response in patients with relapsed or refractory aggressive cd19+ NHL.
Notably, in the same month, the FDA granted Breakthrough Therapy designation to JCAR017 for the treatment of relapsed/refractory (r/r) aggressive large B-cell non-Hodgkin lymphoma (NHL), including diffuse large B-cell lymphoma (DLBCL) and Primary Mediastinal B-cell Lymphoma (PMBCL). Further, the candidate was granted Priority Medicines (PRIME) eligibility for r/r DLBCL by the European Medicines Agency (EMA).
The company continues to work on developing the other candidates on its pipeline.
2016 Results
Full-year sales surged to $79.4 million from year-ago figure of $18.2 million. Sales surpassed the Zacks Consensus Estimate of $74.3 million.
The full-year loss of $2.69 per share was wider than Zacks Consensus Estimate of a loss of $2.63. The company had posted earnings of $1.78 per share a year ago.
2017 Guidance
Juno expects cash burn of $270–$300 million in 2017, excluding the impact of business development activities.
Juno Therapeutics, Inc. Price, Consensus and EPS Surprise
Juno Therapeutics, Inc. Price, Consensus and EPS Surprise | Juno Therapeutics, Inc. Quote
Zacks Rank & Key Picks
Juno Therapeutics currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include Cellectis S.A. (CLLS - Free Report) and Sunesis Pharmaceuticals, Inc. . Each of these stocks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cellectis’s loss per share estimates narrowed from $2.33 to $1.80 for 2016 and from $2.94 to $1.69 for 2017 over the last 30 days. The company posted positive surprises in three of the four trailing quarters with an average beat of 111.20%.
Sunesis’ loss per share estimates narrowed from $2.57 to $2.44 for 2016 and from $2.16 to $1.97 for 2017 over the last 60 days. The company posted positive earnings surprises in three of the four trailing quarters with an average beat of 0.54%.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>