WWB Securities rates GERN "strong BUY" 25 second(s) ago Article Last Updated: 8/01/2006 07:00 AM
Research costs squeeze Geron
, Bloomberg News
Inside Bay Area
Geron Corp., the developer of cancer treatments based on an enzyme that may inhibit cell growth, said its second-quarter loss tripled as revenue tumbled and research-related costs rose.
The net loss widened to $9.3 million, or 14 cents a share, from $3.1 million, or 6 cents, a year earlier, Menlo Park-based Geron said Monday. Revenue fell to $786,000 from $4.7 million in the year-earlier quarter, when the company received a payment for the rights to a cloning technique.
Expenses rose on higher spending for compensation and for making an experimental cancer vaccine based on the enzyme telomerase, Geron said. The enzyme research is in later development stages than the company's work commercializing treatments using human embryonic stem cells, which have the potential to develop into any type of cell in the human body.
"This company's revenues are based on products that everyone acknowledges are in the offing," said Steve Brozak, an analyst with WBB Securities Inc. in New Jersey. Brozak rates the stock a "strong buy" and doesn't own it. The loss is "not anything of consequence," he said.
Shares of Geron rose 7 cents, or 1.1 percent, to $6.39 in Nasdaq Stock Market composite trading.
Geron said it had higher manufacturing costs during the quarter for its telomerase-based vaccine, GRNVAC1, which is in human testing.
The company also began trials at the University of Chicago during the quarter on a telomerase-based drug, GRN163L, to test its safety in patients with tumors.
Geron is conducting other early-stage trials using telomerase to treat leukemia as well as prostate, blood and kidney cancers.
Revenue for the quarter primarily came from TA Therapeutics Ltd., a joint venture with the Biotechnology Research Corp. of Hong Kong to develop antivirals based on the telomerase enzyme, the company said.
In the 2005 quarter, Geron received a $4 million payment for transferring the rights for a cloning technique to a new joint venture, Start Licensing Inc.
In its stem-cell research, Geron has said it plans to apply for approval from the Food and Drug Administration to begin tests next year on injecting stem cells into people with spinal cord injuries to repair nerve damage.
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