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Nektar Therapeutics Tumbles To 2-Year Low On Q2 Revenue Miss, Manufacturing Issues With Cancer Drug

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Nektar Therapeutics Tumbles To 2-Year Low On Q2 Revenue Miss, Manufacturing Issues With Cancer Drug

Nektar Therapeutics (NASDAQ: NKTR) shares were plummeting to a two-year low Friday following the release of its quarterly results the prior afternoon, wiping away roughly $1.9 billion of its market value.

Top-Line Miss

Nektar, a biopharma that develops investigational medicines for cancer, auto-immune disease and chronic pain, reported Thursday after the close with second-quarter revenue of $23.3 million — down sharply from the $1.088 billion reported for one year ago. 

The year-ago revenues included $1.06 billion in license revenue from a collaboration agreement with Bristol-Myers Squibb Co (NYSE: BMY).

The company reversed from a profit of $5.33 per share in the second quarter of 2018 to a loss of 63 cents per share in the second quarter of 2019.

Analysts, on average, estimated a loss of 80 cents per share on revenue of $26.65 million.

Operating expenses increased about 18% year-over-year as R&D expenses inflated due to pipeline programs.

Opioid Drug Approval Delay

With the FDA postponing the adcom meeting for NKTR-181 that was originally scheduled for Aug. 21, it is possible the agency may not be able to meet the PDUFA goal date of Aug. 29, according to the company. 

NKTR-181 is an opioid analgesic being evaluated for pain relief without the high levels of euphoria that can lead to abuse and addiction with standard opioids.

Manufacturing Issues With Melanoma Drug

A statement from CEO Howard Robin on the earnings call regarding bempegaldesleukin in combination with Bristol-Myers' Opdivo for treating patients with previously untreated metastatic melanoma was another negative for the stock. 

The response rates softened between the first and second Fleming cohorts of the PIVOT trial that evaluated bempegaldesleukin in melanoma.

Of the 22 lots of bempegaldesleukin produced to date, two of the earliest production batches — lots two and five — were different, Robin said. 

"We have identified the cause of the physical differences between these lots, which we now know stem from a single suboptimal batch of in-process intermediate that was used to produce only these two lots, lots two and five of the 22 lots we've made to-date," he said on the call. 

The company said the softening issue will not be repeated.

Nektar shares were down 38.34% at $18.23 at the time of publication Friday — their lowest level since late August 2017. 

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