Catalyst Pharma (CPRX) Q3 Earnings: Will Stock Surprise?
Zacks Investment Research | Nov 06, 2016 08:25PM ET
Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) is scheduled to report third-quarter 2016 results on Nov 9, after market close. Last quarter, the company’s loss was narrower than expected.
Catalyst’s performance so far has been mixed. The company beat expectations in two of the last four quarters, while posted in-line results in the remaining two. The average positive earnings surprise over the last four quarters is 9.82%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Given that Catalyst does not have any revenue-generating product in its portfolio yet, investor focus will remain on pipeline and regulatory updates. At present, Catalyst has three candidates under development – Firdapse, CPP-115 and CPP-109.
Its lead pipeline candidate is Firdapse which is being evaluated for the symptomatic treatment of Lambert-Eaton myasthenic syndrome. However, the company was handed a “refusal-to-file” letter from the FDA in Feb 2016 in connection with its New Drug Application (NDA) for the product. The agency determined that the company’s NDA was insufficient after a preliminary review.
In June, Catalyst reached an agreement with the FDA for a confirmatory phase III study protocol on Firdapse. In October, Catalyst received a Special Protocol Assessment (SPA) from the FDA on the protocol of the confirmatory phase III study. It was determined that the confirmatory study will have the same co-primary endpoints as Catalyst's first phase III trial evaluating Firdapse for the treatment of LEMS and not a cross-over design as management previously expected. A SPA raises optimism that a positive outcome from the study could be sufficient to support an NDA submission for Firdapse.
Catalyst is also working on developing Firdapse for additional indications. The company is evaluating it for the treatment of certain types of congenital myasthenic syndromes (CMS) and for a specific type of myasthenia gravis (MG). The company initiated an investigator-sponsored phase II/III study on Firdapse for the symptomatic treatment of MuSK-antibody positive MG (MuSK-MG) in Feb 2016 and top-line results from this study are expected in early 2017.
Apart from Firdapse, the company is looking to develop CPP-115 for the treatment of epilepsy (initially infantile spasms), and other selected neurological indications such as complex partial seizures and Tourette’s disorder. The company is also developing CPP-109 for the treatment of Tourette’s Disorder. Catalyst is also working on a generic version of Sabril (vigabatrin), which is marketed by Lundbeck, for the treatment of infantile spasms and complex partial seizures.
Consequently, its R&D spending is expected to go up due to clinical development efforts taken toward Firdapse in the pediatric CMS population and MuSK-MG.
Earnings Whispers
Our proven model does not conclusively show that Catalystis likely to beat the Zacks Consensus Estimate this quarter. That is because a stock needs to have both a positive Zacks Investment Research
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