Epizyme, Inc. (EPZM - Free Report) incurred a loss of 49 cents per share in the first quarter of 2018, narrower than the Zacks Consensus Estimate of a loss of 54 cents as well as the year-ago loss of 56 cents.
Shars of the company went up 3.3% following the earnings release. So far this year, the stock has rallied 13.2% against the industry’s decline of 12.3%.
Quarter in Detail
With no approved products in its portfolio as of now, Epizyme heavily relies on its collaborators for revenues. The company fell short of earning any revenues in the reported quarter for the lack of collaboration milestones. However, the Zacks Consensus Estimate for the top line was pegged at $1 million.
Research and development (R&D) expenses increased 3.8% year over year to $25.6 million in the quarter. This downside was primarily due to the higher costs related to tazemetostat manufacturing and clinical development activities as well as research with respect to advancing the company’s preclinical G9a inhibitor program.General and administrative (G&A) expenses were $9.4 million in the quarter under review, up 13.3% from the year-ago period. This stemmed from an increased headcount and related expenses as well as expanded pre-commercial activities.
Epizyme had $247.9 million of cash, cash equivalents and marketable securities as of Mar 31, 2018 compared with $276.4 million as of Dec 31, 2017.
The company also expects its balance sheet as of Mar 31, 2018 to be sufficient enough to fund its planned operations through the third quarter of 2019.
On Apr 23, 2018, the FDA issued a partial clinical hold on the new enrollment of U.S. patients in the company’s ongoing trials for its lead piepeline candidate- tazemetostat. The FDA’s decision was based on a safety report of a pediatric patient, who developed a secondary T-cell lymphoma in the ongoing phase I study for tazemetostat. Epizyme is aggressively working to address the partial clinical hold and plans to confirm alignment with U.S. and French regulators so that enrolment can be resumed.
Epizyme was also advised on similar line by French National Agency for Medicines and Health Products Safety (ANSM). The company will present a new clinical data at multiple medical meetings during the second quarter and expects to file its first new drug application by the fourth quarter of 2018.
During the first quarter, the European Commission (EC) granted an orphan drug designation to tazemetostat for the treatment of patients with follicular lymphoma, diffuse large B-cell lymphoma (DLBCL) and malignant mesothelioma.
During the first quarter, Epizyme completed enrolling 71 wild-type EZH2 patients in its cohort, investigating tazemetostat in combination with the steroid prednisolone for relapsed or refractory DLBCL.
During the first quarter, the company also completed the enrollment of 45 patients with relapsed or refractory DLBCL in a phase Ib trial, investigating tazemetostat in combination with Roche’s (RHHBY - Free Report) Tecentriq (atezolizumab), a PD-L1 inhibitor.
Zacks Rank & Key Picks
Epizyme has a Zacks Rank #3 (Hold). Two few better-ranked stocks from the same space are Ligand Pharmaceuticals (LGND - Free Report) and Protagonist Therapeutics (PTGX - Free Report) , both sporting a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
Ligand’s earnings per share estimates have moved up from $4.20 to $4.43 for 2018 over the last 60 days. The company delivered a positive earnings surprise in three of the trailing four quarters with an average beat of 24.88%. The company’s shares have rallied 14.9% year to date.
Protagonist’s loss estimates have narrowed from $1.30 to 66 cents for 2018 and from $1.99 to $1.26 for 2019 over the last 60 days. The company came up with a positive surprise in three of the last four quarters with an average beat of 24.95%.
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