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Medicines Company (MDCO) Q2 Earnings Top, Inclisiran in View

Zacks Equity Research

The Medicines Company MDCO reported second-quarter 2019 adjusted loss of 63 cents per share, narrower than the Zacks Consensus Estimate of a loss of 66 cents and in line with the year-ago loss.

Shares of The Medicines Company have soared 90.4% so far this year, outperforming the industry’s increase of 0.3%.

In the reported quarter, the Medicines Company did not generate any revenues. The Zacks Consensus Estimate for the metric was pegged at $2.5 million. However, in the prior-year quarter, the company’s revenues grossed $1.6 million.

The Medicines Company divested all its marketed products, namely Angiomax, Vabomere, Orbactiv and Minocin in 2018 as part of its restructuring activities to focus solely on developing its late-stage candidate, inclisiran. This explains the absence of any revenue count in the second quarter.

Adjusted selling, general and administrative expenses (SG&A) were down 5.7% year over year to $16.6 million in the reported quarter. Moreover, adjusted research and development expenses (R&D) declined 11.7% to $25.7 million.

The company’s cash and cash equivalents as of Jun 30, 2019 totaled $319.3 million compared with $199.7 million on Mar 31, 2019. The company believes that its existing cash balance will enable it to fund operating expenses through the second half of 2020.

Pipeline Update

The Medicines Company has one promising candidate — inclisiran (hypercholesterolemia) — in its pipeline. The company along with partner Alnylam Pharmaceuticals, Inc. ALNY is evaluating inclisiran in several phase III ORION studies for treating patients with atherosclerotic cardiovascular disease (ASCVD) and elevated bad cholesterol (LDL-cholesterol).

Last week, the Independent Data Monitoring Committee (IDMC) recommended continuation of the ongoing phase III ORION studies on inclisiran as designed. Therefore, the same is being conducted without any modification.

The latest suggestion from IDMC came after the regulatory body’s seventh review of unblinded safety and efficacy data from the ORION programs on the PCSK9 inhibitor, which the Medicines Company considers to have blockbuster potential.

The companies expect to present top-line data from the ORION analyses in the second half of third-quarter 2019 and subsequently, file a new drug application (NDA) in the United States in the fourth quarter of 2019 as well as a marketing authorization application (MAA) in the EU during the first quarter of 2020.

The Medicines Company Price, Consensus and EPS Surprise

The Medicines Company Price, Consensus and EPS Surprise

The Medicines Company price-consensus-eps-surprise-chart | The Medicines Company Quote

Zacks Rank & Stocks to Consider

The Medicines Company currently carries a Zacks Rank #3 (Hold). Two better-ranked stocks in the healthcare sector are Acorda Therapeutics, Inc. ACOR and Repligen Corporation RGEN, both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Acorda’s loss per share estimates have been narrowed 2.2% for 2019 and 1.3% for 2020 over the past 60 days.

Repligen’s earnings estimates have been revised 4.3% upward for 2019 and 3.6% for 2020 over the past 60 days. The stock has surged 69.9% year to date.

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