Human Genome Sciences Inc.’s (:HGSI) second quarter 2012 loss of 46 cents per share was wider than the Zacks Consensus Estimate of a loss of 39 cents and year-ago loss of 42 cents. The wider loss was due to higher expenses.
Human Genome’s revenues in the reported quarter jumped 142.7% to $60.3 million, beating the Zacks Consensus Estimate of $54 million. Revenues were boosted by strong Benlysta sales.
The Quarter in Details
Benlysta, co-developed by Human Genome and GlaxoSmithKline (GSK), was launched in the US in March 2011 and is currently available in several countries. Benlysta net sales improved 22.1% sequentially to $38.1 million in the second quarter of 2012.
Human Genome has already started a phase III study of a subcutaneous formulation of Benlysta. The company has also initiated a lupus nephritis phase III trial of Benlysta and intends to initiate phase III studies for vasculitis.
Revenues recognized from the sale and delivery of inhalation anthrax treatment, ABthrax, to the US Strategic National Stockpile was $6.5 million in the reported quarter as opposed to $12.8 million in the year-ago period. Human Genome has a contract for delivering doses of ABthrax to the US Strategic National Stockpile, for use in the event of an emergency to treat inhalation anthrax.
Revenues from manufacturing and development services other than ABthrax came in at $15.5 million, up 287.2%.
Research & development (R&D) expenses for the reported quarter increased 6.1% to $35.4 million while selling, general & administrative (SG&A) expenses climbed 29.9% to $51.2 million.
We remind investors that in July this year, Human Genome and GlaxoSmithKline announced a definitive agreement under which the latter will acquire the former for $14.25 per share in cash after a long negotiation between the two companies. With this acquisition, Glaxo will gain full ownership of the lupus drug Benlysta, along with albiglutide and darapladib.
Currently, we have a Neutral recommendation on Human Genome. The stock carries a Zacks #4 Rank (short-term Sell rating).
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