Intercept Pharmaceuticals, Inc. ICPT posted a loss of $1.99 per share, wider than the Zacks Consensus Estimate of a loss of $1.94. The company had incurred a loss of $1.51 per share in the year-ago quarter.
In the reported quarter, the company generated licensing revenues of $0.4 million and missed the Zacks Consensus Estimate of $1 million. Revenues were flat year over year.
Research and development expenses shot up 89.7% year over year to $28.3 million. General and administrative expenses were $21 million up 163.7% from the year-ago quarter.
Pipeline Update
Intercept Pharma is working on the development of its pipeline. During the quarter, the company completed a rolling NDA submission for OCA in the U.S. for PBC. A decision from the FDA is expected in the first quarter of 2016 (if the candidate gets priority review status). The candidate is also under review by the European Medicines Agency for the same indication, with a decision expected in the second half of 2016.
Meanwhile, the company is enrolling patients in a phase IIIb long-term outcomes study (COBALT) to confirm the benefit of OCA in PBC patients on a post-marketing basis as well as in a phase II study for the treatment of patients suffering from primary sclerosing cholangitis.
Additionally, the company intends to commence the first phase III registrational study on OCA for non-cirrhotic nonalcoholic steatohepatitis patients with fibrosis shortly. A phase II study evaluating the lipid metabolic effects of OCA is expected to begin later this year.
A phase II study on OCA for biliary atresia is also expected to commence later in 2015.
2015 Outlook
The company does not expect to earn meaningful revenues in the U.S. until second-quarter 2016 and in the EU until 2017.
Intercept Pharma now expects adjusted operating expenses of $240 million (excluding stock-based compensation and other non-cash items) compared to the previous projection of $180 million – $200 million. The increase in guidance reflects accelerated infrastructure build-out supporting Intercept’s commercial and research and development efforts.
Our Take
Intercept Pharma’s second-quarter results were disappointing. However, the company’s efforts on pipeline development are impressive.
Intercept Pharma carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the health care sector are Valeant Pharmaceuticals International, Inc. VRX, Alcobra Ltd. ADHD and Anacor Pharmaceuticals, Inc. ANAC. While Valeant carries a Zacks Rank #1 (Strong Buy), Alcobra and Anacor hold a Zack Rank #2 (Buy).
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