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Sanofi SA (ADR) (SNY), Bristol Myers Squibb Co. (BMY): Why Peregrine Pharmaceuticals (PPHM) Earnings Won’t Show Profits

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Peregrine Pharmaceuticals (NASDAQ:PPHM) will release its latest quarterly report on Monday, and investors are under no illusions that the company will avoid losing money again this quarter. Their hope, though, is that in the long run, one of the biotech’s treatments will win approval and help finally send Peregrine earnings to profitability.

With its monoclonal antibody treatment and diagnosis method for cancer and other diseases, Peregrine Pharmaceuticals (NASDAQ:PPHM) has the potential to deliver groundbreaking products that could save and extend countless lives. Yet as with any small biotech or pharmaceutical company, the trick is whether Peregrine can actually deliver on its promise. Let’s take an early look at what’s been happening with Peregrine Pharmaceuticals over the past quarter and what we’re likely to see in its quarterly report.

Peregrine Pharmaceuticals (NASDAQ:PPHM)

Stats on Peregrine Pharmaceuticals

Analyst EPS Estimate ($0.05)
Year-Ago EPS ($0.07)
Revenue Estimate $4.75 million
Change From Year-Ago Revenue 11.7%
Earnings Beats in Past 4 Quarters 3

Source: Yahoo! Finance.

Will Peregrine earnings look better this quarter?

In recent months, analysts have gotten a little less optimistic in their long-run views on Peregrine Pharmaceuticals (NASDAQ:PPHM) earnings. They haven’t changed their July quarter loss estimates, but they’ve widened their loss projections for the current and next fiscal years by $0.04 per share each. The stock has performed even worse, falling 20% since early June.

One major problem that Peregrine Pharmaceuticals (NASDAQ:PPHM) has had is that its study data have been inconsistent at best. News earlier this year that Peregrine got FDA approval to start its bavituximab phase 3 trial for non-small-cell lung cancer got a hugely positive response. Yet one reason for that response is that after facing controversy over contradictory phase 2 results, investors were relieved that the FDA would even allow Peregrine to begin a phase 3 trial.

Subsequently, that inconsistency has continued, with an initially encouraging report of new data showing a substantial survival increase of 4.4 months for non-small-cell lung cancer patients giving way to later data in late June that showed much less benefit. Peregrine Pharmaceuticals (NASDAQ:PPHM) decided as a result to stop studying one particular treatment combination, leading to a big part of the stock’s recent drop.

Peregrine’s strategy going forward is to start its phase 3 trial by the end of the year, which will compare the combination of bavituximab and Sanofi SA (ADR) (NYSE:SNY)‘s docetaxel against results from using docetaxel alone. Peregrine will also look for other areas in which bavituximab and other phosphatidylserine-targeting antibodies could be effective. A presentation last month at the Cambridge Healthtech Institute’s Immunotherapies Congress highlighted the importance of targeting that specific lipid component on immune response.

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