What's In Store For Radius Health In Q1 Earnings?

Radius Health, Inc. RDUS is scheduled to report first-quarter 2018 results on May 10.

Radius Health has a disappointing track record. The company has reported wider-than-expected loss in the trailing four trailing quarters with an average negative earnings surprise of 8.93%.

In the last reported quarter, increase in general and administrative expenses led to the wider than anticipated net loss year over year.

Let's see how things are shaping up for the quarter under review.

Factors at Play

Radius Health develops therapeutics for the treatment of osteoporosis, oncology and endocrine diseases.

The company's lead drug, Tymlos, was approved in the United States in April 2017. The drug was approved for treating postmenopausal women with osteoporosis at high risk for fracture, defined as history of osteoporotic fracture and multiple risk factors for fracture. The drug can also be used for patients who have failed or are intolerant to other available osteoporosis therapies. The company reported sales of Tymlos (abaloparatide) of $7.7 million in fourth-quarter 2017.

Hence, we expect investors to focus on the uptake of the drug during the upcoming earnings call.

Although the osteoporosis market in the United States has great potential as approximately 1.4 million postmenopausal women suffer from osteoporotic fractures each year, Tymlos is expected to face significant competition from Eli Lilly & Co LLY's Forteo and Amgen AMGN's Prolia.

Meanwhile, the company's Marketing Authorisation Application for Eladynos (abaloparatide-SC) in Europe for the treatment of postmenopausal women with osteoporosis was under review.  However, the scientific committee of the European Commission, Committee for Medicinal Products for Human Use ("CHMP"), gave a negative trend vote on the benefit-risk balance for the marketing authorization application ("MAA") for abaloparatide-SC in an oral explanation. The CHMP will therefore adopt a negative opinion on the same. The company was planning to get abaloparatide-SC approved for the treatment of osteoporosis in postmenopausal women at increased risk for fracture. Radius Health plans to seek a re-examination of the CHMP opinion.

In December 2017, the CHMP issued a third Day-180 List of Outstanding Issues and informed the company that it intends to refer the MAA to a scientific advisory group for additional advice. The company has earlier issued a second Day-180 List of Outstanding Issues. The delay in getting approval in Europe is disappointing given the market potential.

Meanwhile, the company presented positive data on elacestrant for breast cancer in December 2017. The FDA also granted Fast Track designation to elacestrant in October 2017.  In February 2018, Radius Health obtained scientific advice from the EMA regarding a potential single-arm monotherapy phase II trial of elacestrant in patients with ER-positive/HER2-negative advanced or metastatic breast cancer. Based on feedback from the EMA and the FDA, the company will conduct a single, randomized, controlled phase II trial of elacestrant as a third-line monotherapy in approximately 300 patients with ER positive/HER2 negative advanced/metastatic breast cancer. Hence, we expect the management to throw more light on pipeline progress.

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