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Pacira (PCRX) Q2 Earnings and Revenues Surpass Estimates

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Pacira Pharmaceuticals, Inc. (PCRX - Free Report) reported second-quarter 2018 earnings of 24 cents per share, surpassing the Zacks Consensus Estimate of 9 cents and the loss of 11 cents incurred a year ago.

Revenues increased 18.5% year over year to $84.1 million, beating the Zacks Consensus Estimate of $80 million. Exparel sales came in at $80.4 million for the second quarter of 2018, rising approximately 15% year over year. Shares were up more than 5% following its earnings release on Aug 2.

Sales of the drug continue to grow and it is now being administered to more than 4.3 million patients across the United States.

However, Pacira’s share price has slipped 1% year to date against the industry’s increase of 0.8%.

Quarter in Detail

Pacira’s top line comprises product revenues, collaborative licensing and milestone revenues plus royalty revenues.

Collaborative licensing and milestone revenues surged to $3 million. This huge uptick was primarily owing to an agreement with China-based Nuance for the development and commercialization of Exparel in China. Royalty revenues were $0.39 million, down 41.3%.

Research and development (R&D) expenses (excluding the impact of stock-based compensation) were down 37.9% to $11.3 million. This decrease in R&D was due to the completion of phase III studies in nerve block.

Selling, general and administrative (SG&A) expenses increased 14.6% to $39.2 million because of an expanded public affairs campaign focused on improving access to non-opioid options and expenses related to the launch of Exparel for brachial plexus nerve block.

Recent Developments

In June, Pacira inked an agreement with China-based Nuance for the development and commercialization of Exparel in China. Per the agreement, Pacira will receive $3 million as upfront payment upon closing the transaction and will also be eligible for an additional $55 million in regulatory and sales milestone payments.

Pacira’s collaboration with Aetna has been lucrative as well. The latter provides a separate reimbursement for Exparel as well as its online DocFind directory to help its members identify surgeons, who are committed to offering non-opioid options like Exparel for postsurgical pain.

Notably in April, the FDA approved Pacira’s supplemental new drug application (sNDA) seeking the label expansion of Exparel (bupivacaine liposome injectable suspension) to include administration via nerve block for prolonged regional analgesia. Pacira along with partner Johnson & Johnson (JNJ - Free Report) is focusing on the launch of Exparel in the expanded indication.

With this approval, Exparel is the first long-acting, single-dose nerve block available for patients undergoing upper extremity surgeries such as total shoulder arthroplasty or rotator cuff repair.

Pacira is also developing Exparel for its use in pain management with respect to various other surgeries and also expanding its label to address complications in pediatric patient population.

Outlook

Pacira raised its guidance for Exparel sales in 2018 and expects it to be in the range of $320-$325 million. The previous guidance was in the band of $300-$310 million.

The company expects R&D expenses (excluding stock-based compensation) to be within $50-$60 million while SG&A expenses (excluding stock-based compensation) are anticipated in the $150-$160 million range. Also, stock-based compensation is expected between $30 million and $35 million. All these remain unchanged from the last reported quarter’s outlook.

 

Pacira Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

Pacira Pharmaceuticals, Inc. Price, Consensus and EPS Surprise | Pacira Pharmaceuticals, Inc. Quote

Zacks Rank & Other Stocks to Consider

 

Pacira currently sports a Zacks Rank #1 (Strong Buy). Other top-ranked stocks in the health care sector include Eagle Pharmaceuticals, Inc. (EGRX - Free Report) and Vanda Pharmaceuticals Inc. (VNDA - Free Report) , each with a Zacks Rank of 1.You can see the complete list of today’s Zacks #1 Rank stocks here.

Eagle Pharmaceuticals’ earnings estimates have been moved 15.1% north for 2018 and 26% for 2019 over the past 60 days. The stock has soared 45.4% year to date.

Vanda Pharmaceuticals’ earnings estimates have been revised 11.1% upward for 2018 and 3.9% for 2019 over the past 60 days. The stock has surged 37.5% so far this year.

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