Avanir Reports Narrower Loss, Revs Up Y/Y

Zacks

Avanir Pharmaceuticals, Inc. (AVNR) reported first quarter fiscal 2014 net loss per share of 7 cents, narrower than the Zacks Consensus Estimate of a loss of 8 cents and the year-ago loss of 9 cents.

First quarter revenues rose 62% year over year to $26.7 million, above the Zacks Consensus Estimate of $24 million.

Quarter in Detail

Net revenues included Nuedexta revenues, co-promotion revenues and royalty revenues from Abreva. Net Nuedexta revenues grew 56.6% year over year to $23.3 million. Nuedexta is approved for the treatment of patients suffering from pseudobulbar affect (PBA).

Research and development (R&D) expenses were $9.5 million as compared to $6.6 million in the year-ago quarter, driven by pipeline development. Selling and marketing expenses rose 29.2% year over year to $17.5 million, driven by increased personnel costs. General and administrative expenses increased 29.2% year over year to $8.4 million.

Pipeline Update

Avanir is looking to expand Nuedexta’s label. Nuedexta is currently being studied for two additional indications in phase II, one for the treatment of agitation in Alzheimer's disease (top line data - second half calendar 2014) and other for the levodopa induced dyskinesia (:LID) in patients suffering from Parkinson's disease (second half calendar 2014). Avanir enrolled the first patient in a proof of concept phase II study in LID. 

Avanir joined forces with OptiNose for the development and commercialization of AVP-825 for the treatment of acute migraine in Jul 2013. A New Drug Application (:NDA) for AVP-825 was filed in Jan 2014. Once approved, it will be the first and only fast-acting, dry-powder nasal delivery form of Imitrex.

Avanir entered into a multi-year agreement with Merck KgAa (MKGAF) to co-promote Merck's Januvia in the U.S. in Aug 2013. In the reported quarter, Avanir commenced promoting Januvia and the sitagliptin family of products in the long-term care setting in the U.S.

Another candidate, AVP-786 is being developed for the treatment of neurologic and psychiatric disorders.  Avanir will soon commence a study on AVP-786 for the treatment resistant major depressive disorder.

Avanir carries a Zacks Rank #3 (Hold). Revenues from Nuedexta were encouraging. This was the eleventh consecutive quarter of double-digit sales growth for Nuedexta. Avanir is also making efforts to expand Nuedexta’s label. The NDA filing of AVP-825 is encouraging as the potential approval will reduce Avanir’s dependence on Nuedexta, its solitary product.

Some better-ranked players in the biopharma industry include Biodel Inc. (BIOD) and Endocyte Inc. (ECYT). Endocyte carries a Zacks Rank #1 (Strong Buy) while Biodel carries a Zacks Rank #2 (Buy).

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