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Esperion (ESPR) Reports Wider-Than-Expected Loss in Q3

Zacks Equity Research

Esperion Therapeutics, Inc. ESPR incurred a loss of $2.52 per share in the third quarter of 2019, wider than the Zacks Consensus Estimate of $2.01. The company had incurred loss of $1.86 per share in the year-ago period.

The company generated revenues of $1.01 million, almost in line with the Zacks Consensus Estimate. Revenues were mainly attributable to initial recognition of the upfront payment related to the commercial agreement with Daiichi Sankyo Europe which Esperion signed in January. The agreement grants exclusive rights to Daiichi Sankyo to commercialize Esperion’s bempedoic acid and the bempedoic acid/ Merck’s MRK Zetia combination pill in Europe and Switzerland, following their potential approval.

Esperion is seeking approval for bempedoic acid pill and bempedoic acid/Zetia combination pill as a treatment for elevated LDL-C (bad cholesterol) in hypercholesterolemia patients.

Esperion’s shares have declined 18.9% so far this year against the industry’s 4.2% increase.

Quarter in Details

Research and development (R&D) expenses increased 16.2% from the year-ago period to $48.3 million. The rise was primarily due to higher cost needed to support cardiovascular outcomes study on bempedoic acid and manufacture its candidates for commercial supply.

General and administrative (G&A) expenses more than doubled year over year to $18.5 million primarily due to costs related to support pre-commercialization activities for bempedoic acid monotherapy, and the bempedoic acid/Zetia combination regimen..

As of Sep 30, 2019, Esperion had cash, cash equivalents and investment securities of $244.8 million compared with $302.2 million as of Jun 30, 2019.

2019 Guidance

Esperion maintained its 2019 guidance for collaboration revenues and operating expenses. The company expects income from collaboration and license agreement to be $150 million. The company expects cash funding of $125 million under its revenue interest purchase agreement with Oberland Capital.

The company raised its guidance for R&D expense to the range of $135-$145 million compared with the previous guidance range of $115-$120 million. G&A expense guidance range was maintained in the range of $60-$65 million.

The company lowered its guidance for net increase in cash to the range of approximately $70 to $80 million from $90 to $100 million. The reduction reflects higher cash burn due to higher patient enrollment than targeted in the CLEAR cardiovascular outcomes study on bempedoic acid and accelerated certain commercial product manufacturing activities in 2019, previously planned for 2020.

Pipeline Update

In August, Esperion announced top-line data from the phase II study evaluating a combination of bempedoic acid and Zetia. Data showed that the combination regimen met the study’s primary endpoint of LDL-C (bad cholesterol) reduction. The combination regimen lowered LDL-C levels by 40% compared to placebo over the 12-week treatment period.

In September, the company completed enrollment in the CLEAR cardiovascular outcomes study. The study is evaluating bempedoic acid for occurrence of major cardiovascular events in statin averse patients with or at high-risk of cardiovascular disease.

Earlier this year, Esperion had submitted regulatory applications seeking approval for bempedoic acid monotherapy and bempedoic acid/Zetia combination pill for treating hypercholesterolemia in the United States and Europe. A decision from the FDA is expected in February 2020 and a decision in Europe is expected in the second quarter of 2020.

Esperion Therapeutics, Inc. Price, Consensus and EPS Surprise

 

Esperion Therapeutics, Inc. Price, Consensus and EPS Surprise

Esperion Therapeutics, Inc. price-consensus-eps-surprise-chart | Esperion Therapeutics, Inc. Quote

Zacks Rank & Key Picks

Esperion currently carries a Zacks Rank #2 (Buy).

Some other top-ranked from the biotech sector are Vertex Pharmaceuticals Incorporated VRTX and Acorda Therapeutics, Inc. ACOR. Both stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Vertex’s earnings per share estimates have moved up from $4.58 to $4.79 for 2019 and from $6.03 to $6.62 for 2020 in the past 30 days. The company delivered a positive earnings surprise in all the trailing four quarters, with the average beat being 17.59%. Share price of the company has increased 19% so far this year.

Loss estimates for Acorda have narrowed from $2.98 to $2.18 for 2019 and from $3.74 to $1.95 for 2020 in the past 30 days. The company pulled off a positive earnings surprise in all the last four quarters, with the average beat being 68.8%.

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