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Aduro (ADRO) Q1 Earnings and Revenues Fall Shy of Estimates

Zacks Equity Research

Aduro BioTech, Inc. ADRO incurred first-quarter 2019 loss of 29 cents per share, wider than the Zacks Consensus Estimate of a loss of 17 cents as well as the year-ago loss of 28 cents.

Revenues came in at $3.9 million, down 40.9% year over year due to an absence of a $3- million milestone payment received from Merck MRK in 2018. The top line also missed the Zacks Consensus Estimate of $8.08 million.

Shares of Aduro have soared 67.1% so far this year, outperforming the industry’s increase of 6%.

Quarter in Detail

Research and development expenses dipped 3% in the reported quarter to $19.5 million owing to lower stock-based compensation and personnel costs.

General and administrative expenses were $9.2 million, up 2.2% year over year, primarily due to higher professional services and consulting costs.

Pipeline Update

Aduro’s three distinct technology platforms, designed to harness the body's natural immune system, are being utilized to develop treatments for several cancer indications and show potential for label expansion into auto-immune and infectious diseases. The three well-defined platforms are the LADD technology, STING pathway activator and the B-select monoclonal antibody.

Aduro’s lead assets are STING agonist ADU-S100 and anti-APRIL antibody, BION-1301.

Aduro has a collaboration and license agreement with Novartis NVS for developing its lead STING Activator candidate, ADU-S100.

In February this year, Aduro dosed the first patient in a phase I study, evaluating ADU-S100 in combination with Bristol-Myers’ BMY Yervoy (ipilimumab) for the treatment of relapsed/refractory melanoma.

Earlier, ADU-S100 was being investigated as a single agent. However, the protocol was amended later to include the analysis of ADU-S100 in combination with Yervoy on a homogeneous patient population.

Meanwhile, during the quarter, Aduro initiated the planned phase I clinical program on BION-1301 evaluating healthy volunteers for treating IgA nephropathy — the primary indication of the BION-1301 program. However, due to the current competitive landscape, Aduro has decided to discontinue with the planned phase I/II probe on BION-1301 for MM.

We would like remind investors that last December, Aduro entered into an exclusive collaboration and license agreement with pharma giant Eli Lilly to develop novel immunotherapies for autoimmune and other inflammatory diseases by leveraging its cGAS-STING inhibitor platform. In the first quarter of 2019, Aduro received an upfront payment $12 million from this contract with Eli Lilly, which enhanced its cash position at the end of the period.

Aduro Biotech, Inc. Price, Consensus and EPS Surprise

Aduro Biotech, Inc. Price, Consensus and EPS Surprise | Aduro Biotech, Inc. Quote

Zacks Rank

Aduro currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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