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Intercept (ICPT) Beats on Q3 Earnings & Sales, Ups View

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  • ICPT

Intercept Pharmaceuticals, Inc. ICPT incurred a loss of 63 cents (excluding gain on extinguishment of debt) per share in third-quarter 2021, narrower than the Zacks Consensus Estimate of a loss of $1.00 and the year-ago quarter’s loss of $2.01.

Total revenues of $92.8 million in the quarter beat the Zacks Consensus Estimate of $83 million and also increased from $79.5 million in the year-ago quarter.

Shares of the company were up following the results. However, the stock has slumped 21.8% in the year so far compared with the industry’s decline of 8.2%.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

Quarter in Detail

Total revenues generated in the quarter comprised only Ocaliva (obeticholic acid or OCA) net sales. Net sales came in at $66.6 million in the United States and $26.2 million outside the country.

OCA is approved under the brand name Ocaliva for treating primary biliary cholangitis (PBC) in combination with ursodeoxycholic acid (UDCA) in adults with an inadequate response to UDCA alone or as a monotherapy for adults intolerant to UDCA.

Research and development expenses decreased to $45 million from $48.9 million in the year-ago quarter, primarily driven by lower personnel and development costs.

Selling, general and administrative expenses decreased to $53.3 million from $70.6 million in the year-ago quarter. The decline was driven by actions taken to decrease expenses relating to the launch preparation activities associated with the potential approval and commercialization of OCA for liver fibrosis due to non-alcoholic steatohepatitis (NASH) following the complete response letter, which was received in 2020.

As of Sep 30, 2021, Intercept had cash, cash equivalents, restricted cash and marketable securities of $428.8 million.

2021 Guidance Upped

Ocaliva net sales are now projected between $355 million and $370 million (earlier guidance: $325 million to $340 million).

Other Updates

The prescribing information for lead drug, Ocaliva, in the United States has been updated. The update to the prescribing information was prompted by cases submitted to the FDA’s Adverse Event Reporting System and published in the medical literature. These were cases of worsening of liver problems or liver failure in PBC patients with cirrhosis treated with Ocaliva.

Consequently, the Boxed Warning has been updated and Ocaliva is now contraindicated for patients with PBC and decompensated cirrhosis, a prior decompensation event, or with compensated cirrhosis with evidence of portal.
The company is on track to compile a new data package from the phase III REGENERATE study in fibrosis due to NASH to support a potential resubmission meeting with the FDA in the first half of 2022.

Our Take

The lower-than-expected loss in the third quarter was encouraging. The company’s effort to develop a treatment for NASH despite setbacks is positive.

Intercept Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

Intercept Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Intercept Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

Intercept Pharmaceuticals, Inc. price-consensus-eps-surprise-chart | Intercept Pharmaceuticals, Inc. Quote

While the NASH market promises potential, it is quite challenging as well. Bigwigs like Novo Nordisk NVO and Gilead Sciences, Inc. GILD are also evaluating candidates for NASH. Another company, Viking Therapeutics VKTX, is developing a candidate, VK2809, for biopsy-confirmed NASH and fibrosis.

Intercept 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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