Orexigen Therapeutics, Inc reported adjusted loss of $1.82 per share in the second quarter of 2017, which was narrower than the Zacks Consensus Estimate of a loss of $2.40. Adjusted loss excludes amortization of intangible assets and change in value of contingent consideration.
However, adjusted loss was wider than the year-ago loss of $1.73.
Quarterly revenues of approximately $23.4 million were significantly higher than $7.8 million in the year-ago quarter. The top-line improvement was primarily attributed to higher Contrave sales
Orexigen’s shares were up 3.8% in after-market trading on Aug 8, presumably on impressive Contrave sales. In fact, shares are up 33.9% so far this year, outperforming the industry’s gain of 8.8%.
In the second quarter, U.S. net sales of Contrave, its weight management drug, were $20.7 million. Product sales to global partners amounted to $2.7 million.
IMS Health's prescription data recorded 233,966 total prescriptions for Contrave filled this quarter, an increase of 21% from the year-ago period. Also, net revenue per unit increased 37%.
R&D expenses decreased 47.3% from the year-ago period to $7.5 million. General and administrative expenses were $48.3 million, up 93.3% from the year-ago period due to costs associated with commercializing Contrave in the U.S.
In Apr 2017, the company announced that Health Canada has accepted a new drug submission seeking marketing approval for Contrave. It also completed regulatory submissions for marketing authorization in four more countries during the quarter. Also, in May, a commercialization and distributorship agreement was signed with Norwegian Medtech and pharmaceutical products company, Navamedic ASA, for selling Contrave (Mysimba) in Denmark, Finland, Iceland, Norway and Sweden. Notably, this is the company’s fifth partnership in Europe.
Subsequent to the quarter, Orexigen signed two more agreements to distribute Contrave in Germany, France, Austria and Egypt.
Orexigen has achieved impressive sales growth for Contrave in the first half of 2017. The drug was approved in Sep 2014. We expect the trend to continue throughout the year as the company is focused on expanding the drug’s reach through digital and social media marketing and partnerships with regional partners outside the U.S. The company has also introduced new promotional materials and educational resources for health care practitioners.
Zacks Rank & Stocks to Consider
Orexigen carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the pharma sector include Summit Therapeutics PLC (SMMT - Free Report) , Aduro Biotech, Inc. (ADRO - Free Report) and Enzo Biochem, Inc. . All the three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Summit’s loss estimates narrowed from $2.59 to 32 cents for 2017 over the last 60 days. The company delivered positive earnings surprise in each of the four trailing quarters with an average beat of 25.55%. Its share price is up 66.6% so far this year.
Enzo Biochem’s loss estimates narrowed from 12 cents to 7 cents for 2017 over the last 60 days. The company came up with a positive earnings surprise in all the four trailing quarters with an average beat of 55.83%. The stock is up 62.7% so far this year.
Aduro Biotech’s loss per share estimates narrowed from $1.46 to $1.36 for 2017 over the last 30 days. The company delivered a positive surprise in two of the four trailing quarters with an average beat of 2.53%. The stock is up 7.9% so far this year.
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