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bluebird (BLUE) Q2 Loss Narrower Than Expected, Sales Miss

bluebird bio, Inc. BLUE reported an adjusted loss of $1.27 per share (excluding restructuring charges) from continued operations in the second quarter of 2022, narrower than the Zacks Consensus Estimate of a loss of $1.31. In the year-ago quarter, BLUE posted a loss of $2.31 from continued operations.

Revenues from continued operations were $1.5 million, which missed the Zacks Consensus Estimate of $6 million.

In November 2021, bluebird completed the separation of the oncology business into an independent entity called 2seventy bio, Inc. TSVT. We note that TSVT has been listed on the Nasdaq since November 2021.

Following the split, BLUE does not have any approved drug in the United States as Abecma, an FDA-approved multiple myeloma drug, has been transferred to 2seventy bio. BLUE now only focuses on the severe genetic diseases business.

Shares of bluebird have plunged 54.2% so far this year compared with the industry’s 19.7% decline.


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Zacks Investment Research

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Quarter in Detail

Research and development expenses from continuing operations decreased to $63.8 million from $84.6 million a year ago.

Selling, general and administrative expenses from continuing operations were $36.7 million, down from $54.9 million in the year-ago quarter.

As of Jun 30, 2022, bluebird had restricted cash, cash and cash equivalents and marketable securities balance of approximately $218 million, including restricted cash of about $45 million.

Recent Updates

In June, the FDA’s Cellular, Tissue, and Gene Therapies Advisory Committee (CTGTAC) voted unanimously (13-0) that the benefits of betibeglogene autotemcel (beti-cel) gene therapy outweigh the risks for patients with beta-thalassemia who require regular red blood cell transfusions.  The FDA has set a target action date of Aug 19, 2022, for this candidate. bluebird bio anticipates receiving a priority review voucher (PRV) upon potential approval of beti-cel.

In addition, CTGTAC voted unanimously (15-0) that the benefits of elivaldogene autotemcel (eli-cel) gene therapy outweigh the risks for the treatment of any sub-population of children with early active cerebral adrenoleukodystrophy (CALD).

The FDA has set a target action date of Sep 16, 2022, for the same. Eli-cel is being reviewed under Priority Review for the targeted indication and the company anticipates receiving a PRV upon potential approval.

BLUE is also in active discussions to resolve the clinical hold on eli-cel and anticipates the FDA’s questions may be resolved concurrently with the agency’s ongoing review.

bluebird bio remains on track to submit a biologics licensing application (BLA) to the FDA for lovotibeglogene autotemcel (lovo-cel) for sickle cell disease in the first quarter of 2023. The company has treated all patients in HGB-206 Group C who will form the primary basis of efficacy for BLA. Additionally, bluebird completed enrollment of all patients in the HGB-210 study necessary to support manufacturing data requirements for the BLA submission.

The company remains in active dialogue with the regulatory body about the resolution of the partial clinical hold for patients under 18.

The company has raised approximately $24.7 million in gross proceeds through its At-the-Market (ATM) equity facility. bluebird is exploring additional financing opportunities, including public or private equity financings and monetizing any PRVs that may be issued upon approval of beti-cel or eli-cel.

Zacks Rank & Stocks to Consider

bluebird currently has a Zacks Rank #4 (Sell).

A couple of better-ranked stocks in the sector are Alkermes ALKS and Dynavax DVAX. While DVAX carries a Zacks Rank #1 (Strong Buy), Alkermes has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

ALKS’ earnings estimates for 2022 reversed from a loss of 17 cents to earnings of 20 cents in the past 30 days. Alkermes surpassed earnings in all the trailing four quarters, the average being 325.48%.

Dynavax’s earnings estimates have increased to $1.15 from $1.14 for 2022 over the past 60 days. Earnings of Dynavax have surpassed estimates in two of the trailing four quarters.

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