AVEO Pharmaceuticals, Inc. (AVEO - Free Report) incurred third-quarter 2018 adjusted loss of 5 cents per share, which is narrower than the Zacks Consensus Estimate of a loss of 6 cents. However, the loss was wider than the year-ago adjusted loss of 2 cents.
AVEO’s top line comprises collaboration and licensing revenues plus partnership royalties. Total revenues in the third quarter were approximately $2.5 million, down 46.5% from the year-ago figure, primarily due to lower collaboration and licensing revenues. However, revenues beat the Zacks Consensus Estimate of $1 million.
AVEO’s Fotivda (tivozanib) is the first approved drug in the company’s portfolio. It was approved in the EU last August for the first-line treatment of advanced renal cell carcinoma (RCC). However, the company is conducting clinical studies to support its approval in the United States. It is focused on launching the drug across the various European countries.
During the third quarter of 2018, Fotivda was launched in Scotland, Sweden and the Netherlands. It is already available in Germany, Austria and the United Kingdom. The company receives double-digit royalty payments from EUSA Pharma on the drug's net sales in Europe.
Shares of AVEO were up 6.45% in after-hours trading following its earnings release. However, the stock has lost 33.3% so far this year, wider than the industry’s decline of 16.5%.
Research & development expenses were up 10.6% year over year to $5.2 million. Moreover, general and administrative expenses also increased 28.6% year over year to $2.7 million.
AVEO expects that its present cash resources of $20.4 million will allow the company to fund its planned operations through the second quarter of 2019.
AVEO is evaluating Fotivda in a phase III study — TIVO-3 — for the treatment of patients with RCC in first-line setting. Data from this study along with the previously completed TIVO-1 evaluation will support the filing of a regulatory application for Fotivda’s approval in the United States.
Earlier this month, AVEO announced positive top-line data from the phase III TIVO-3 study, which compared Fotivda with Nexavar on patients with highly refractory advanced or metastatic RCC. The study met its primary endpoint by demonstrating a statistically significant benefit in progression-free survival (PFS). The company plans to submit a new drug application (NDA) within six months.
In October, AVEO along with EUSA Pharma presented updated interim results from the phase II portion of the TiNivo program. The study, which evaluated Fotivda in combination with Bristol-Myers’ (BMY - Free Report) Opdivo, demonstrated a favorable safety and efficacy profile in advanced/metastatic renal cell carcinoma.
AVEO is also developing ficlatuzumab in combination with Lilly’s (LLY - Free Report) Erbitux in a phase II investigation for treating metastatic head and neck squamous cell carcinoma.
Zacks Rank & Key Pick
AVEO currently carries a Zacks Rank #2 (Buy). Another top-ranked stock in the healthcare sector is Alexion Pharmaceuticals, Inc. (ALXN - Free Report) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alexion’s earnings estimates have moved 4.8% north for 2018 and 1.8% for 2019 over the past 60 days. The stock has gained 3.2% so far this year.
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