Onyx Reports Higher Revenues
By Zacks Equity Research , On Wednesday February 24, 2010, 8:28 am
Onyx Pharmaceuticals (NasdaqGS: ONXX - News) has reported a fourth quarter loss of 9 cents per share, much better than a loss of 53 cents reported in the year-ago period. However, after adjusting non recurring items and treating stock-based compensation as a regular expense, the company reported earnings per share (EPS) of 4 cents compared to 7 cents in the fourth quarter of 2008. The Zacks Consensus Estimate for the reported quarter was 22 cents.
For the full year 2009, Onyx’s EPS (after adjustments) came in at 56 cents compared to 63 cents in 2008.
For the full year and fourth quarter of 2009, Onyx reported revenue from its Nexavar (sorafenib) collaboration agreement of $250.4 million (up 29%) and $67.3 million (up 35.6%), respectively. The increase in revenue is primarily due to an increase in Nexavar sales and royalty revenue partially offset by a rise in the drug’s commercial expenses.
Nexavar is currently approved and marketed for the treatment of liver cancer and advanced kidney cancer in the US, the European Union as well as other territories worldwide. The drug, manufactured by Bayer (Other OTC: BAYRY.PK - News), is being studied for several other indications as well – breast cancer, ovarian cancer, thyroid cancer and in combination therapy with chemotherapy agents.
Onyx and Bayer are splitting the development cost for Nexavar and share profits equally in all territories excluding Japan. Bayer pays royalty to Onyx on sales in Japan.
R&D expenses increased 3.8% in 2009 due to developmental programs of Nexavar for additional indications including thyroid, colorectal and adjuvant liver cancer and costs related to the further development of another candidate, ONX 0801.
In Sep 2009, Onyx began enrolling patients in a phase I study of ONX 0801 as a potential treatment for advanced solid tumors. This triggered a milestone payment of $7 million to BTG International Limited, which had licensed the drug to Onyx. Moreover, R&D expenses increased due to the development of carfilzomib following the acquisition of Proteolix in Oct 2009.
SG&A expenses increased 24.8% for the full year primarily due to an increase in cost associated with a rise in headcount and acquisition-related costs.
At the end of 2009, cash, cash equivalents, and marketable securities were $587.3 million, up from $458 million at the end of December 2008. The 84% increase in cash balance was primarily due to net proceeds from debt and equity financing in August 2009 and cash generated from operations, partially offset by cash paid for the Proteolix acquisition. We have a “Neutral rating on the stock.
surf's up......crikey
