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Acceleron (XLRN) Q1 Loss Wider Than Expected, Revenues Miss

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Acceleron Pharma Inc. (XLRN - Free Report) reported a loss of 95 cents in the first quarter of 2020, wider than the Zacks Consensus Estimate of a loss of 84 cents and a loss of 74 cents in the year-ago quarter. The wider year-over-year loss was primarily due to increased operating expenses.

The company reported collaboration revenues of $4.3 million in the reported quarter, increasing from $2.8 million in the year-ago quarter but missing the Zacks Consensus Estimate of $6 million.

Total revenues reported in the quarter include $2.8 million of cost share revenues and $1.5 million of royalty revenues from net sales of Reblozyl (luspatercept-aamt) in the United States.

In November 2019, the FDA approved the company’s first drug, Reblozyl, for the treatment of anemia in adult patients with beta-thalassemia, who require regular red blood cell or RBC transfusions.

Research and development costs increased to $37.6 million from $32.8 million in the year-ago quarter. Selling, general and administrative costs too increased to $18.2 million from $10.8 million in the year-ago quarter.

Cash, cash equivalents and investments as of Mar 31, 2020, were $415.6 million, down from $453.8 million at December-end. Based on its current operating plans and projections, Acceleron believes that current cash, cash equivalents and investments will be sufficient to fund projected operating requirements for some time as it expects to receive significant royalty revenues from Reblozyl sales.

Acceleron’s stock has gained 98.2% in the year so far compared with the industry’s growth of 9.2%.


Other Updates

Last month, Acceleron and partner Bristol Myers Squibb (BMY - Free Report) obtained FDA approval for the label expansion of Reblozyl for the treatment of anemia failing an erythropoiesis stimulating agent and requiring 2 or more red blood cell (RBC) units over 8 weeks in adult patients with very low- to intermediate-risk MDS with ring sideroblasts (MDS-RS) or with myelodysplastic/myeloproliferative neoplasm with ring sideroblasts and thrombocytosis (MDS/MPN-RS-T).

In April 2020, Reblozyl also received a positive opinion from the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) for the treatment of adult patients with transfusion-dependent anemia due to very low, low and intermediate-risk MDS with ring sideroblasts, who had an unsatisfactory response to or are ineligible for erythropoietin-based therapy and transfusion-dependent anemia associated with beta-thalassemia.

Meanwhile, Bristol-Myers is currently conducting a phase II study, BEYOND, with luspatercept-aamt in non-transfusion-dependent beta-thalassemia patients. The top-line results are currently expected by the end of 2020 or early 2021. The company is also conducting a phase III study, COMMANDS, in first-line, lower-risk MDS patients, with top-line results expected in 2022.

A phase III study, INDEPENDENCE, in patients with myelofibrosis (MF) on concomitant JAK 2 inhibitor therapy who require RBC transfusions is expected to start by year-end.

Acceleron is also developing sotatercept for the treatment of patients with pulmonary arterial hypertension (PAH) in partnership with Bristol Myers. In April, sotatercept was granted Breakthrough Therapy designation by the FDA for the treatment of patients with PAH. The EMA recently granted Priority Medicines (PRIME) designation to sotatercept for the treatment of patients with PAH.

While the label expansion of Reblozyl is encouraging, competition can be stiff from Novartis's (NVS - Free Report) Exjade and Jadenu. Moreover, Incyte’s (INCY - Free Report) Jakafi is already approved for MF.

Acceleron 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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