ImmunoGen Inc. (IMGN) reported second quarter fiscal 2013 adjusted loss of 29 cents per share, wider than both the Zacks Consensus Estimate of a loss of 24 cents and the year-ago loss of 17 cents per share. The year-over-year miss was primarily due to lower revenues and higher expenses.
ImmunoGen’s revenues in the reported quarter came in at $2.6 million, compared with $7.6 million in the second quarter of fiscal 2012. The huge difference in revenues was primarily due to the presence of $5.0 million milestone payments in the year-ago quarter. Revenues in the second quarter were much lower than the Zacks Consensus Estimate of $6 million.
Quarter in Details
ImmunoGen’s revenues comprise of research and development support fees, license and milestone fees and clinical material reimbursement. The company recorded $2.0 million of research and development support fees in the second quarter of fiscal 2013 compared with $0.9 million in the year-ago period.
ImmunoGen received $0.4 million of license and milestone fees and $0.1 million of clinical material reimbursement during the quarter in comparison to a respective $6.0 million and $0.6 million in the same period last year.
The company’s total operating expenses during the quarter increased 33% to $27.1 million. ImmunoGen reported research and development (R&D) expenses of $21.7 million during the quarter, up 39.2% year over year. The increase in R&D expenses during the quarter was primarily due to higher expenses related to pipeline development.
General and administrative expenses in the second quarter of fiscal 2013 came in at $5.5 million, up 13% year over year due to higher patent related expenses and recruitment costs.
ImmunoGen’s metastatic breast cancer candidate, trastuzumab emtansine (T-DM1) is currently under review both in the US and the EU. The candidate is being developed for the treatment of patients suffering from HER2+, unresectable locally advanced or metastatic breast cancer who have received prior treatment with Roche Holding’s (RHHBY) Herceptin (trastuzumab) and a taxane. A final decision from the US Food and Drug Administration (:FDA) regarding the approval of the candidate should be out by Feb 26, 2013.
The company also expects to report clinical findings on three of its wholly owned compounds - IMGN901 (small-cell lung cancer, multiple myeloma), IMGN853 (ovarian and non-small cell lung cancers) and IMGN529 (non-Hodgkin's lymphoma).
ImmunoGen also has plans to advance its EGFR-overexpressing solid tumors candidate, IMGN289, into clinical trials. The company expects to submit an Investigational New Drug (IND) application for the candidate in mid-2013.
Outlook for Fiscal 2013
Apart from releasing its financial results, ImmunoGen announced its guidance for fiscal 2013. The company expects net loss of $70–$74 million for the fiscal year ending Jun 30, 2013. ImmunoGen expects to exit fiscal year 2013 with cash and cash equivalents of $172–$176 million.
We expect investor focus to stay on the FDA’s decision regarding the approval of T-DM1 in Feb this year. ImmunoGen currently carries a Zacks Rank #3 (Hold). However, other pharma stocks such as Warner Chilcott plc (WCRX) and Valeant Pharmaceuticals (VRX) carry a Zacks Rank #1 (Strong Buy).Read the Full Research Report on VRX
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