SpringWorks Q2 Earnings Beat, Ogsiveo Drives Revenues

SpringWorks Therapeutics, Inc. SWTX incurred a loss of 54 cents per share in the second quarter of 2024, which was significantly narrower than the Zacks Consensus Estimate of a loss of $1.12. The company had reported a loss of $1.25 per share in the year-ago quarter.

In the second quarter, total revenues were $59.7 million, which also comprehensively beat the Zacks Consensus Estimate of $35 million.

Total revenues comprised net product sales of Ogsiveo (nirogacestat) and other revenues. The company did not generate any revenues in the year-ago quarter.

Ogsiveo was approved by the FDA for treating adult patients with progressing desmoid tumors who require systemic treatment in November 2023.

Following the FDA nod, not only Ogsiveo became the first approved product in the company's portfolio, but it also became the first approved drug for treating desmoid tumors, a rare, aggressive tumor of the soft tissues.

Shares of SpringWorks have declined 7.1% year to date compared with the industry's decrease of 4.4%.

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Quarter in Detail

Net product revenues from Ogsiveo surged 91.4% on a sequential basis to $40.2 million, driven by a strong commercial launch and high demand for the drug.

Per management, Ogsiveo has rapidly become the standard of care systemic therapy for patients with desmoid tumors since its approval last November.

The marketing authorization application for Ogsiveo for the treatment of adult patients with desmoid tumors is currently under review with the European Medicines Agency ("EMA"). A potential approval in the EU is expected in 2025.

Other revenues were $19.5 million in the second quarter.

Research and development expenses totaled $44.4 million in the second quarter, up 23.7% from the year-ago quarter's level, owing to higher costs related to drug manufacturing and increased expenses related to ongoing clinical studies and employee costs.

Selling, general and administrative expenses totaled $57.8 million, up around 23% year over year due to higher costs to support the launch of Ogsiveo in the United States as well as preparations for the launch of mirdametinib, upon potential approval.

As of Jun 30, 2024, SpringWorks had cash, cash equivalents and marketable securities worth $521.9 million compared with $573 million as of Mar 31, 2024.

Recent Updates

In April 2024, the FDA approved a supplemental new drug application for two higher doses of Ogsiveo (150 mg & 100 mg) tablets in blister packaging. This is expected to increase patient convenience and adherence by reducing the number of pills a patient has to take daily and making the dosage simpler.

Several additional studies on Ogsiveo, targeting different cancer indications, are currently ongoing.

Last month, SWTX completed the new drug application submission for its investigational MEK inhibitor, mirdametinib, which has been developed for the treatment of neurofibromatosis type 1- associated plexiform neurofibromas (NF1-PN), in pediatric and adult patients. The company plans to announce the target action date for mirdametinib in the upcoming weeks.

The company plans to file a marketing application with the EMA seeking approval for mirdametinib for treating children and adults with NF1-PN later in the second half of 2024.

Meanwhile, during the second quarter, SpringWorks initiated a phase Ia study evaluating its investigational, oral, selective pan-TEAD inhibitor, SW-682, in Hippo-mutant solid tumors.

Zacks Rank & Stocks to Consider

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

Some better-ranked stocks in the biotech sector are Exact Sciences Corporation EXAS, Fulcrum Therapeutics, Inc. FULC and Entrada Therapeutics, Inc. TRDA, each sporting a Zacks Rank #1 (Strong Buy) at present.

In the past 60 days, estimates for Exact Sciences' 2024 loss per share have narrowed from $1.09 to $1.00. Loss per share estimates for 2025 have narrowed from 21 cents to 8 cents. Year to date, shares of EXAS have decreased 24.3%.

EXAS' earnings beat estimates in three of the trailing four quarters while meeting the same on the remaining occasion, the average surprise being 56.19%.

In the past 60 days, estimates for Fulcrum Therapeutics' 2024 loss per share have narrowed from $1.24 to 48 cents. Loss per share estimates for 2025 have narrowed from $1.71 to $1.51. Year to date, shares of FULC have increased 22.8%.

FULC's earnings beat estimates in each of the trailing four quarters, the average surprise being 393.18%.

In the past 60 days, estimates for Entrada Therapeutics' 2024 loss per share have narrowed from 14 cents to 13 cents. Loss per share estimates for 2025 have narrowed from $3.44 to $3.21. Year to date, shares of TRDA have lost 8.5%.

TRDA's earnings beat estimates in two of the trailing four quarters while meeting the same on the remaining two occasions, the average surprise being 42.18%.

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