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Esperion (ESPR) Q3 Earnings Beat, Stock Up on Strong Revenues

Esperion Therapeutics, Inc. ESPR incurred a loss of 37 cents per share in the third quarter of 2023, narrower than the Zacks Consensus Estimate of a loss of 42 cents. The company incurred a loss of 81 cents per share in the year-ago quarter.

Esperion generated revenues of $34.0 million, up 79% year over year. The reported figure beat the Zacks Consensus Estimate of $30.8 million.

Quarter in Detail

Esperion has two FDA-approved drugs — Nexletol and Nexlizet — in its commercial portfolio that are approved for treating elevated LDL-C (bad cholesterol). These two oral drugs are marketed as Nilemdo and Nustendi in Europe and several other ex-U.S. markets in partnership with Daiichi Sankyo. The company records royalties on sales of its drugs in Europe and other ex-U.S. markets.

In Japan, Esperion has an agreement for the development and commercialization of Nexletol and Nexlizet tablets with Otsuka Pharmaceuticals.

Product revenues, solely from the United States, totaled $20.3 million in the third quarter, up 45% year over year. The upside was driven by continued prescription growth. During the quarter, the drugs’ retail prescription grew 33% year over year and 8% quarter over quarter.

The reported product revenues missed the Zacks Consensus Estimate and our model estimate of $23.5 million and $22.5 million, respectively.

Esperion recorded collaboration revenues, which include combined royalty and partner revenues, of $13.7 million during the reported quarter, up 174% year over year. The upside can be attributed to increased royalty revenue and tablet shipments to international partners.

Collaboration revenues missed the Zacks Consensus Estimate and our model estimate of $6.6 million and $7.1 million, respectively.

Shares of the company rallied 7.7% on Tuesday in response to the better-than-expected collaboration revenue performance. Yet, the stock has plunged 83.5% year to date compared with the industry’s 15.1% fall.

Research and development (R&D) expenses declined 49% from the year-ago period’s level to $14.9 million, primarily related to the close-out of the company’s CLEAR Outcomes study.

Selling, general and administrative (SG&A) expenses were up 33% year over year to $33.2 million, thanks to higher legal and promotional costs.

As of Sep 30, 2023, Esperion had cash, cash equivalents, restricted cash and investment securities of $114.8 million compared with $138.5 million as of Jun 30, 2023.

2023 Guidance

Esperion reiterated its financial outlook for 2023. The company still expects operating expenses in the range of $225-$245 million, including $25 million in non-cash expenses related to stock compensation. Guidance for total operating expenses includes $100-$110 million in R&D expenses and $125-$135 million in SG&A expenses.

Recent Updates

In June, Esperion submitted supplemental new drug applications to the FDA for the label expansion of Nexletol ((bempedoic acid) and Nexlizet ((bempedoic acid and ezetimibe). The company also submitted a type II(a) variation application for expanded use of Nilemdo and Nustendi to the European Medicines Agency.

These applications aim to seek approval for expanded use of bempedoic acid for reducing cardiovascular risk in patients with or at high risk for atherosclerotic cardiovascular disease. Management expects to get the label expansion approval in the United States before the end of first-quarter 2024 and in Europe by first-half 2024.

Zacks Rank & Stocks to Consider

Esperion currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the overall healthcare sector include Acadia Pharmaceuticals ACAD, Allogene Therapeutics ALLO and Apellis Pharmaceuticals APLS, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past 30 days, estimates for Acadia’s 2023 loss per share have narrowed from 41 cents to 35 cents. During the same period, the earnings estimates per share for 2024 have risen from 60 cents to 79 cents. Shares of ACAD are up 47.6% in the year-to-date period.

Earnings of Acadia beat estimates in two of the last four quarters while missing the mark on the other two occasions, witnessing an average earnings surprise of 20.33%. In the last reported quarter, Acadia’s earnings beat estimates by 108.33%.

Allogene’s loss estimate has narrowed from $2.25 to $2.19 per share in the past 30 days. During the same period, the loss estimates per share for 2024 have narrowed from $2.21 to $2.13. Shares of ALLO have plunged 47.9% in the year-to-date period.

The earnings of Allogene beat estimates in three of the last four quarters while missing the mark on one occasion, witnessing an average earnings surprise of 3.93%. Allogene’s earnings beat estimates by 10.17%.

Apellis Pharmaceuticals’ loss estimates for 2024 have narrowed from $2.41 to $1.94 per share in the past 30 days. Year to date, Apellis Pharmaceuticals’ shares have lost 8.5%.

Apellis Pharmaceuticals beat earnings estimates in two of the last four quarters while missing the mark on the other two occasions, witnessing a negative earnings surprise of 3.91% on average. In the last reported quarter, APLS reported a negative earnings surprise of 39.29%.

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