We all knew that they hired a huge sales force (75 FTE with omcology experience--not cheap), leased 35k feet of office space in Orange County in 4q, and spent alot of money to market Zev after approval in September. This is NOT, repeat NOT bad news. It should have been expected by anyone who follows this stock. The loss is NOT attributable to sales or revenue, but to expenses that are absolutely necessaryin order TO MAKE GOBS OF MONEY. Also,itcomes at the end of 1Q. 1Q results will be release (hopefully) in about 5-6 weeks--which should show a huge sequential gain from 4q 2009.
IMO yesterday's "news" is a simply a smoke screen. First of all the release simply states was that loss for fiscal year of 2009 may increase from 2008. It does NOT state Q4 2009 loss will be greater than Q4 2008 loss. Looking at the income statements for 09 shows about 17.5 mill loss for the first 3 quarter of 2009 so far compared to 15.5 million for fiscal year 2008. So unless the company can actually pull a profit of 2 million or more Q4 09 (whiles increased sales and marketing expenses, including payroll costs, incurred with the launch of Zevalin), the state from the filing is still true.
Start-up is much more costly than just salaries. You have hiring costs, relocation costs, marketing costs, travel costs, etc. What's important is whether Z sales are growing at or above expectations, not net profit at this time.
My hope is that the release of this news was strategic - i.e. rather than let bashers play it up as bad news during the earnings call, release anything that might be construed as negative early. This way, when the positive news that we're hoping for on revenues comes out, there is nothing to tarnish or offset it. You would think that if revenues were not in line, they would also have released that bit of information as well. Guess we'll see by next week - but I expect most of the shares trading now are weak hands being shaken out.