Catalyst Rises as Q2 Earnings & Revenues Beat Estimates

Catalyst Pharmaceuticals, Inc. CPRX reported adjusted earnings of 56 cents per share for the second quarter of 2024, beating the Zacks Consensus Estimate of 42 cents. The company reported adjusted earnings of 53 cents in the year-ago quarter.

Total revenues, the majority of which comprised product revenues, amounted to $122.7 million in the reported quarter, representing growth of 23% year over year. The recorded figure also surpassed the Zacks Consensus Estimate of $111.6 million.

Catalyst's top line primarily comprised revenues from the sale of Firdapse, the first approved drug for the treatment of Lambert-Eaton myasthenic syndrome (LEMS) and Fycompa (perampanel) CIII. Revenues generated from the sale of the newly launched Agamree (vamorolone) also contributed to the top line.

The stock is gaining in the pre-market hours on Aug 8 as the investors are impressed by the better-than-expected second-quarter results. Year to date, shares of CPRX have lost 3.5% compared with the industry's 4.6% decline.

Image Source: Zacks Investment Research

Quarter in Detail

Firdapse generated sales worth $77.4 million in the second quarter, up 19.2% year over year. The reported figure beat the Zacks Consensus Estimate of $72.5 million and our estimate of $72.9 million, driven by the organic sales growth of Firdapse. The drug has been witnessing strong demand and increasing prescription rates from LEMS patients, as well as continued diagnosis of new LEMS patients.

Catalyst also started recording sales of its newest epilepsy asset, Fycompa, from the first quarter of 2023. In 2023, CPRX acquired the U.S. rights for Fycompa (perampanel) CIII from Eisai Co., Ltd. This acquisition diversified the company's portfolio by adding a commercial-stage epilepsy asset.

Fycompa generated robust net product revenues of $36.5 million in second-quarter 2024, which beat the Zacks Consensus Estimate of $33.2 million as well as our model estimate of $33.6 million. Fycompa sales recorded year-over-year growth of 5.7%.

In the third quarter of 2023, CPRX acquired exclusive rights to manufacture and supply Agamree from Santhera Pharmaceuticals through a licensing agreement.

In late 2023, the FDA approved Agamree for treating Duchenne Muscular Dystrophy in patients aged two years and older, which gave Catalyst a third approved product. The drug was commercially launched in the United States in the middle of March 2024.

In the first full quarter of commercialization since launch, Agamree generated revenues worth $8.7 million, which beat the Zacks Consensus Estimate of $6 million and our estimate of $5.2 million. Per Catalyst, early indicators for the drug's U.S. launch suggest strong demand that exceeds initial expectations.

Research and development (R&D) expenses were $3 million in the reported quarter, down 25% year over year.

Selling, general and administrative (SG&A) expenses totaled $40.7 million, up 43% from $28.4 million reported in the year-ago quarter. This uptick in costs is primarily due to the launch of Agamree and the cumulative commercial and marketing activities to support three commercial products compared with two in 2023.

As of Jun 30, 2024, Catalyst had cash, cash equivalents and investments worth $375.7 million compared with $310.4 million as of Mar 31, 2024.

2024 Financial Guidance Updated

Catalyst continues to expect total revenues in the range of $455-$475 million for the full year, boosted by the continued growth of Firdapse, Fycompa and additional net product revenues from Agamree. The company believes that the total revenue figure for 2024 will lie toward the high end of its projected range.

For 2024, the company continues to expect Firdapse revenues between $295 million and $310 million and Fycompa revenues in the $130-$135 million band. Catalyst, however, increased its revenue guidance for Agamree in the range of $35-$40 million from the previously guided range of $25-$30 million, based on the promising demand trend and an encouraging payer landscape.

Regulatory Update

In May 2024, Catalyst announced the FDA approval of its supplemental new drug application to increase the maximum daily dose of Firdapse for adults and pediatric patients over 45 kg from 80 mg to 100 mg for treating LEMS.

Per CPRX, this higher dose provides healthcare providers and patients with more flexibility in managing LEMS treatment regimens. This development is expected to spike sales of the drug in the upcoming quarters.

Zacks Rank & Stocks to Consider

Catalyst currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the biotech sector are Annovis Bio, Anixa Biosciences and Akero Therapeutics, each carrying a Zacks Rank #2 (Buy) at present.

In the past 60 days, the Zacks Consensus Estimate for Annovis' 2024 loss per share has remained constant at $2.46. During the same period, the consensus estimate for 2025 loss per share has narrowed from $1.95 to $1.91. Year to date, shares of ANVS have plunged 57.1%.

ANVS beat estimates in three of the trailing four quarters and missed once, delivering an average negative surprise of 1.39%.

In the past 60 days, the Zacks Consensus Estimate for Anixa Biosciences' 2024 loss per share has narrowed from 44 cents to 43 cents. During the same time frame, the estimate for Anixa Biosciences' 2025 loss per share has remained constant at 45 cents. Year to date, shares of ANIX have lost 22.2%.

ANIX beat estimates in three of the trailing four quarters and missed the mark once, delivering an average earnings surprise of 2.27%. 

In the past 60 days, estimates for Akero Therapeutics' 2024 loss per share have narrowed from $3.87 to $3.82. During the same period, loss per share estimates for 2025 have remained constant at $4.29. Year to date, shares of AKRO have gained 1.4%.

Akero's earnings beat estimates in one of the trailing four quarters, missed twice and matched once, delivering an average negative surprise of 5.10%.

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