Incyte Corporation’s (NASDAQ:INCY) fourth quarter loss per share came in at 74 cents compared to a loss of 50 cents reported in the year-ago period (see conference call transcript here). However, excluding one-time items, the company reported a loss of 41 cents per share, higher than the Zacks Consensus Estimate of a loss of 35 cents. For the full year of 2009, adjusted loss per share came in at $1.62 compared to a loss of $1.99 in 2008.
Incyte reported quarterly revenues of $6.9 million compared to $0.9 million reported in the fourth quarter of 2008. For 2009, revenues recorded a 136% rise, which came in at $9.3 million. The collaboration agreement with Novartis (NYSE:NVS) and Eli Lilly (NYSE:LLY) led to the increase in revenues.
In addition to releasing quarterly results, Incyte provided an update on its pipeline candidates. During the reported quarter, the company entered into a collaboration and license agreement with Novartis regarding two of its pipeline candidates – INCB18424, an oral JAK1/JAK2 inhibitor and INCB28060, an oral cMET inhibitor.
While INCB18424 is currently being studied in a phase III clinical trial for myelofibrosis (MF), the INCB28060 is yet to enter phase I trial as a potential treatment for multiple cancers. Along with MF, INCB18424 is in phase II trial for patients with advanced polycythemia vera (PV) and essential thrombocythemia (ET).
While patient enrollment in the phase III trial for INCB18424 is complete in Europe, the US enrollment process is expected to be completed in the first quarter of 2010. Incyte is looking to file a New Drug Application in 2011, provided results from the trials are encouraging.
Incyte also entered into a deal with Eli Lilly regarding the development and commercialization of INCB28050 and certain other follow-on drugs for inflammatory and auto-immune diseases. INCB28050 is currently being studied in a phase II trial for the treatment of rheumatoid arthritis (RA).
Operating expenses during the reported quarter increased 10.3% year-over-year to $48 million primarily on account of a 200% rise in SG&A expenses. The huge increase in SG&A expenses is due to increased expenses associated with the potential commercialization of INCB18424 and costs related to the collaborative agreements. However, R&D expenses declined 10% since Incyte in 2009 decided to prioritize its development efforts to focus its resources on programs with greatest near term value.
At the end of 2009, Incyte had $473.9 million of cash and marketable securities, up from $217.8 million at December-end 2008. In Jan 2010, the company received $150 million based on its collaborative programs.
Incyte provided guidance for 2010 as well. The company expects revenues in the range of $66-$68 million. It also expects to incur $5.1 million as a non-cash charge on the pending redemption of its convertible senior notes. We have a “Neutral” recommendation on the stock.