Stock Update (NASDAQ:MDVN): Medivation Inc Reports First Quarter 2015 Financial Results


Medivation Inc (NASDAQ:MDVN) reported its financial results for the first quarter endedMarch 31, 2015. U.S. net sales of XTANDI® (enzalutamide) capsules, as reported by Astellas Pharma Inc., were $224.0 million for the quarter (+80% vs. prior year). On its February 25, 2015 earnings call, Medivation stated its expectation that first quarter U.S. net sales may be at or below fourth quarter 2014 net sales of $230.2 million. First quarter U.S. net sales of $224.0 million were driven by an increase in underlying demand (low teens percent) offset by an anticipated higher gross-to-net rate as compared with fourth quarter net sales of $230.2 million, which included an increase in channel partner inventory of approximately one week.

Ex-U.S. net sales of XTANDI, as reported by Astellas, were approximately $133 million for the quarter (+161% vs. prior year). First quarter ex-U.S. net sales increased by 6% compared with fourth quarter 2014 net sales of approximately $126 million, and were adversely affected by approximately 9%, due to a strengthening of the U.S. dollar, against the euro and yen.

“We are pleased with the commercial performance of XTANDI during the quarter, which was in line with our expectations and consistent with our previous guidance,” said David Hung, M.D., president and chief executive officer of Medivation. “Looking ahead, we remain focused on creating additional shareholder value through the continued commercialization of XTANDI in mCRPC as well as the development of our proprietary programs which are focused, among other areas, in oncology and neurology.”

Medivation reported a GAAP net loss of $3.1 million, or $0.04 per diluted share, for the quarter ended March 31, 2015, compared with a GAAP net loss of $13.7 million, or $0.18 per diluted share, for the same period in 2014. Non-GAAP net income for the first quarter of 2015 was $13.4 million, or $0.17per diluted share, compared with a Non-GAAP net loss of $4.1 million, or $0.05 per diluted share, for the same period in 2014.

Medivation’s collaboration revenue for the first quarter of 2015 was $129.2 million on a GAAP basis compared with $87.2 million for the same period in 2014 (+48% vs. prior year). Non-GAAP collaboration revenue, which excludes collaboration revenue related to upfront and milestone payments, was$127.8 million for the first quarter compared with $68.0 million for the same period in 2014 (+88% vs. prior year).

Medivation’s collaboration revenue consists of three components: collaboration revenue related to U.S. XTANDI net sales, collaboration revenue related to ex-U.S. XTANDI net sales, and collaboration revenue related to upfront and milestone payments.

  • Medivation’s collaboration revenue related to U.S. net sales of XTANDI for the first quarter of 2015 was $112.0 million compared with $62.2 million for the same period in 2014 (+80% vs. prior year).
  • Medivation’s collaboration revenue related to ex-U.S. net sales of XTANDI for the first quarter of 2015 was $15.8 million compared with$5.7 million for the same period in 2014 (+175% vs. prior year).
  • Medivation’s collaboration revenue related to upfront and milestone payments for the first quarter of 2015 was $1.4 million compared with$19.2 million for the same period in 2014 (-93% vs. prior year).

Operating expenses were $128.6 million for the quarter ended March 31, 2015 on a GAAP basis compared with $95.7 million for the same period in 2014. Non-GAAP operating expenses were $105.3 million for the quarter ended March 31, 2015 compared with $72.5 million for the same period in 2014.

Selling, general and administrative (SG&A) expenses for the first quarter of 2015 were $83.9 million on a GAAP basis compared with $49.7 million for the same period in 2014. Non-GAAP SG&A expenses for the first quarter of 2015 were $67.4 million, compared with $44.2 million for the same period in 2014. The increase in Non-GAAP SG&A expenses primarily relates to higher sales and marketing and medical affairs expenses, higher collaboration expense from Astellas and higher personnel-related costs (excluding stock-based compensation).

Research and development (R&D) expenses for the first quarter of 2015 were $44.7 million on a GAAP basis compared with $45.9 million for the same period in 2014. Non-GAAP R&D expenses for the first quarter of 2015 were $37.9 million, compared with $28.3 million for the same period in 2014. The increase in Non-GAAP R&D expenses primarily relates to higher MDV9300 costs and XTANDI clinical costs, higher pre-clinical expenses for other programs, and higher personnel-related costs (excluding stock-based compensation).

At March 31, 2015, cash and cash equivalents were $568.6 million, compared with $502.7 million at December 31, 2014.

Enzalutamide Development Program

  • Reported top-line results from the Phase 2 STRIVE trial in April 2015. The trial achieved its primary endpoint demonstrating a statistically significant increase in progression free survival (PFS) for patients with non-metastatic or metastatic castration-resistant prostate cancer (CRPC) for enzalutamide compared with bicalutamide (Hazard Ratio = 0.24; 95% Confidence Interval, 0.18-0.32; p < 0.0001). Median PFS was 19.4 months in the enzalutamide group compared with 5.7 months in the bicalutamide group. The median time on treatment in the STRIVE trial was 14.7 months in the enzalutamide group versus 8.4 months in the bicalutamide group. Serious adverse events were reported in 29.4% of enzalutamide-treated patients and 28.3% of bicalutamide-treated patients. Grade 3 or higher cardiac adverse events were reported in 5.1% of enzalutamide-treated patients versus 4.0% of bicalutamide-treated patients. One seizure was reported in the trial in the enzalutamide-treated group and none in the bicalutamide-treated group.
  • Reported top-line results from the Phase 2 TERRAIN trial in January 2015. The trial achieved its primary endpoint demonstrating a statistically significant increase in PFS for patients with metastatic CRPC for enzalutamide compared with bicalutamide (Hazard Ratio = 0.44; 95% Confidence Interval, 0.34-0.57; p < 0.0001). Median PFS was 15.7 months in the enzalutamide group compared with 5.8 months in the bicalutamide group. The median time on treatment in the TERRAIN trial was 11.7 months in the enzalutamide group versus 5.8 months in the bicalutamide group. Serious adverse events were reported in 31.1% of enzalutamide-treated patients and 23.3% of bicalutamide-treated patients. Grade 3 or higher cardiac adverse events were reported in 5.5% of enzalutamide-treated patients versus 2.1% of bicalutamide-treated patients. Two seizures were reported in the enzalutamide group and one in the bicalutamide group.
  • Presented additional results from the Phase 2 TERRAIN trial as well as an updated overall survival analysis from the placebo-controlled Phase 3 PREVAIL trial at the 2015 European Association of Urology Congress in March 2015.
  • Enrolled the first patient in the Phase 3 EMBARK trial in January 2015. The trial is intended to evaluate the efficacy and safety of enzalutamide alone or in combination with androgen deprivation therapy in approximately 1,860 patients with high-risk, hormone-sensitive, non-metastatic prostate cancer that has biochemically recurred (rising prostate-specific antigen, or [PSA] level) following definitive local therapy with radical prostatectomy and/or radiation. The primary endpoint of the trial is metastasis-free survival.
  • Completed enrollment in the Phase 2 trial evaluating enzalutamide in combination with exemestane in women with advanced breast cancer that is estrogen receptor positive (ER+) or progesterone receptor positive (PgR+) and human epidermal growth factor receptor 2 (HER2) normal in March 2015. The trial will assess 247 patients in two parallel cohorts. The first cohort will enroll patients who have not previously received hormonal treatment for advanced breast cancer. The second cohort will enroll patients who have previously progressed following one hormonal treatment for advanced disease. The primary endpoint of the trial is PFS in all patients and in the subset of patients whose tumor expresses the androgen receptor. (Original Source)

Shares of Medivation closed today at $117, down $4.60 or 3.78%. MDVN has a 1-year high of $141.58 and a 1-year low of $59.58. The stock’s 50-day moving average is $129.22 and its 200-day moving average is $113.89.

On the ratings front, Medivation has been the subject of a number of recent research reports. In a report issued on May 5, Canaccord Genuity analyst John Newman reiterated a Buy rating on MDVN, with a price target of $180, which represents a potential upside of 48.9% from where the stock is currently trading. Separately, on April 20, Credit Suisse’s Lee Kalowski downgraded the stock to Hold and has a price target of $115.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, John Newman and Lee Kalowski have a total average return of 6.7% and 33.3% respectively. Newman has a success rate of 46.7% and is ranked #845 out of 3594 analysts, while Kalowski has a success rate of 84.6% and is ranked #412.

In total, 2 research analysts have assigned a Hold rating and 5 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $120.85 which is 21.1% above where the stock opened today.

Medivation Inc is a biopharmaceutical company engaged in the development of novel small molecule drugs to treat diseases like Alzheimer’s disease and Huntington disease.