Peregrine Pharmaceuticals (NASDAQ:PPHM) shares were down 7.55% at the start of the week to $0.370 and an additional 5.46% in after-hours trading to $0.350. The company has a market cap of $111.15 million at 242.38 million shares outstanding. Share prices have been trading in a 52-week range of $0.29 to $1.31.
Peregrine Pharmaceuticals is a biopharmaceutical company that operates through two segments: Peregrine, which is engaged in the research and development of monoclonal antibodies for the treatment of cancer, and Avid, which is engaged in providing contract manufacturing services for third party customers on a fee-for-service basis while also supporting its internal drug development efforts.
Its lead immunotherapy candidate is Bavituximab, which is a monoclonal antibody that targets and binds to phosphatidylserine, a immunosuppressive molecule that is usually located inside the membrane of healthy cells but then flips and becomes exposed on the outside of cells in the tumor microenvironment, causing the tumor to evade immune detection. Its subsidiary Avid Bioservices, Inc. provides integrated current good manufacturing practices services from cell line development to commercial biomanufacturing.
This week, Peregrine Pharmaceuticals announced its financial results for the second quarter of fiscal year ending October 31, 2016. Its consolidated net loss attributable to common stockholders was $5,498,000 or $0.02 per share, smaller than the net loss attributable to common stockholders of $14,578,000, or $0.07 per share for the same quarter last year. It also reported $49,055,000 in cash and cash equivalents as of October 31, 2016, lower than the $61,412,000 figure at fiscal year ended April 30, 2016. Management reaffirmed its manufacturing revenue guidance for the full FY 2017 of $50 -55 million.
The Avid business is on track to continue its revenue growth this fiscal year as we move toward overall profitability within the next 18 months. Our two facilities have the potential to generate in excess of $80 million in revenue, leaving additional capacity for revenue growth beyond fiscal year 2017 revenue guidance,” stated Steven King, President and CEO of Peregrine Pharmaceuticals.
He went on to say that the company is moving forward with plans to construct a third manufacturing facility, with an eye toward efficiencies that will reduce the overall cost of construction and operation, even as they have adequate existing capacity to continue meeting the needs of current clients.
Growing top-line revenue is a key focus and we are pleased to report a 53% improvement in contract manufacturing revenue for the current six-month period compared to the same period last fiscal year. In addition, our revenue guidance for the second quarter was targeted to exceed $20 million and we achieved $23.4 million in contract manufacturing revenue as we worked closely with the third-party testing laboratory to resolve the unexpected delays in testing we encountered during the first quarter,” stated Peregrine Pharmaceuticals CFO Peter Lytle.
He added that the company continued to advance the validation of three separate manufacturing processes related to third-party customer products that could lead to future commercial manufacturing for these products. These incurred higher manufacturing costs that impacted their bottom line for the quarter but reaffirmed that the future revenue that these investments could bring would far outweigh the costs in the long run.
The price reaction of Peregrine Pharmaceuticals stock seemed to indicate that investors were far from impressed by these updates and outlook. Volume picked up on stronger interest but price hit a roadblock at a nearby resistance level, forcing its rally to halt. Still, it could make another attempt at moving closer to the longer-term ceiling around the $0.500 level if bullish pressure is revived.
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