Merrimack Pharma (MACK) Tops Q3 EPS by 4c; Lowers, Narrows FY16 Outlook

November 9, 2016 4:03 PM EST
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Merrimack Pharma (NASDAQ: MACK) reported Q3 EPS of ($0.23), $0.04 better than the analyst estimate of ($0.27). Revenue for the quarter came in at $28.07 million versus the consensus estimate of $39.2 million.

With respect to its fiscal 2016 guidance, Merrimack:

  • Lowers and narrows its previously provided expense guidance range, such that Merrimack now anticipates aggregate research and development and selling, general and administrative expenses for 2016, when calculated in accordance with GAAP, to be in the range of $235.5 million to $245.5 million. Excluding anticipated milestone obligations to PharmaEngine of $35.5 million, this corresponds to a range of $200.0 million to $210.0 million of anticipated aggregate research and development and selling, general and administrative expenses for 2016, which is a non-GAAP financial measure.

With respect to its fiscal 2017 guidance:

  • Merrimack had previously provided guidance as to the achievement of $46.5 million of net milestones related to ONIVYDE in 2016. Merrimack is revising this guidance to reflect that Merrimack now anticipates that only $4.5 million of these net milestones are expected to be achieved in 2016. Merrimack now anticipates that the achievement of the remaining $42.0 million of net milestones related to ONIVYDE will occur in the first half of 2017. This remaining amount is made up of $32.0 million of net substantive milestones, which are expected to increase net income in 2017, and $10.0 million of net non-substantive milestones, which are expected to increase deferred revenues on Merrimack's balance sheet, as they are included in the Shire proportional performance revenue recognition model;
  • Merrimack anticipates that aggregate research and development and selling, general and administrative expenses for 2017, when calculated in accordance with GAAP, will be approximately $193.0 million, which includes the anticipated achievement of $28.0 million of milestone obligations to PharmaEngine. This corresponds to aggregate research and development and selling, general and administrative expenses, excluding anticipated milestone obligations to PharmaEngine, a non-GAAP financial measure, of approximately $165.0 million for 2017; and
  • Merrimack expects that at its currently forecasted spending rates, its existing financial resources, together with anticipated net product revenues and net royalty payments from sales of ONIVYDE, the net milestone payments and reimbursements it expects to receive under its Shire collaboration and access to its $25.0 million credit facility, will be sufficient to fund its operations into 2018.

For earnings history and earnings-related data on Merrimack Pharma (MACK) click here.



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