Aduro Biotech, Inc. (ADRO - Free Report) incurred first-quarter 2018 loss of 31 cents per share, narrower than the Zacks Consensus Estimate of a loss of 33 cents but wider than the year-ago loss of 27 cents.
Revenues came in at $2.6 million, down 56% year over year due to lower reimbursement from partner Novartis (NVS - Free Report) following the adoption of the ASC 606 accounting standard on Jan 1, 2018. The top line also missed the Zacks Consensus Estimate of $4.3 million.
The decrease in collaboration and license revenues for the second quarter was primarily due to recognition of milestone payments from Merck (MRK - Free Report) in the year-ago period. The milestone payment was paid for initiation of a phase I study, evaluating Aduros anti-CD27 antibody in combination with Merck’s Keytruda (pembrolizumab) for treatment of adults with advanced solid tumors.
Shares of Aduro increased more than 6% on Aug 1 in after-hours trading post its earnings release. However, the stock has decreased 23.3% so far this year, wider than the industry’s decline of 2.8%.
Quarter in Detail
Research and development expenses declined 9.3% in the reported quarter to $19.4 million due to lower expenses related to the company’s pipeline candidates, namely ADU-1604 and BION-1301. These are currently under development for treating adults with relapsed or refractory multiple myeloma. Additionally, the termination CRS-207 also lowered the development expenses.
General and administrative expenses were $8.8 million, down 7.3% year over year, primarily on higher stock-based compensation expense and legal fees.
Aduro has a broad pipeline of novel immunotherapies, developed for treating a variety of cancers.
The company presented data at the American Association for Cancer Research Annual Meeting (AACR) from its STING pathway activator, ADU-S100, developed in combination with Novartis AG’s (NVS - Free Report) PD-1 checkpoint inhibitor, PDR001, in a phase Ib trial for treating solid tumors and lymphomas.
Additionally, the candidate is being evaluated in a phase I trial as a monotherapy on patients with cutaneous accessible metastatic solid tumors or lymphomas. Top-line data from the program is expected soon.
In June, Aduro announced the initiation of a phase Ib study of ADU-214 (JNJ-64041757) in combination with Opdivo (nivolumab) for the treatment of advanced lung cancer. ADU-214 is an immunotherapy based on Aduro’s live, attenuated double-deleted Listeria (LADD) technology platform, which is in development stage for treating advanced or metastatic non-small cell lung cancer. Johnson & Johnson’s (JNJ - Free Report) affiliate Janssen — Aduro’s license partner for ADU-214 — is conducting this global study.
Aduro currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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