AVEO Pharmaceuticals, Inc. AVEO reported a first-quarter 2016 loss of 13 cents per share, in line with the Zacks Consensus Estimate but wider than the year-ago loss of 12 cents. AVEO does not have any approved product in its portfolio. The company recognizes revenues in the form of collaboration revenues, milestone and other payments. The company’s total collaboration revenue in the first quarter of 2016 was $1.2 million, up from $0.1 million in the year-ago quarter. Revenues were above the Zacks Consensus Estimate of $1 million. Higher collaboration revenues were primarily attributable to $1 million in revenue recognized in the reported quarter related to the company’s out-licensing agreement with CANbridge Life Sciences, which was carried out in Mar 2016. Quarterly Details Research & development expenses shot up almost 122% year over year to roughly $6 million, mainly due to the preparation of a phase III study on tivozanib. General and administrative expenses decreased 24.3% year over year to $2.5 million. The decline was mainly due to a decrease in external legal costs associated with various ongoing legal matters, and a decrease in employee compensation, consulting, facilities and IT costs as a result of reduction in headcount and utilized facility space following the Jan 2015 restructuring. During the quarter, AVEO’s European partner, EUSA Pharma, announced that it has submitted and received a validation notice for the marketing authorization application that was filed with the European Medicines Agency for tivozanib for the first-line treatment of renal cell carcinoma (RCC). AVEO is presently working toward the commencement of patient enrollment in a pivotal phase III study (TIVO-3) on tivozanib for the first- and third-line treatment of patients with RCC, which is expected in the current quarter. The company also intends to conduct a phase I/II study on tivozanib in combination with a PD-1 inhibitor for the treatment of patients with RCC. The company is looking for partnerships to fund the clinical and regulatory development of tivozanib in North America, including TIVO-3 and a PD1 combination study. As far as other pipeline candidates are concerned, AVEO entered into a collaboration and license agreement in Mar 2016 granting CANbridge the exclusive right to develop, manufacture and commercialize AVEO’s clinical-stage ErbB3 (HER3) inhibitory antibody candidate, AV-203. CANbridge plans to develop AV-203 first for the treatment of esophageal squamous cell cancer. Meanwhile, the company is currently seeking a partner for the global development and commercialization of its potent inhibitory antibody specific to Notch 3 – AV-353 – for the treatment of pulmonary arterial hypertension. AVEO continues to expect its cash resources to fund its current operations into the fourth quarter of 2017. Our Take AVEO’s performance in the first quarter was decent with its loss coming in line with expectation and revenues surpassing it. The company’s progress with its lead pipeline candidate tivozanib is encouraging. Moreover, the company’s focus on exploring partnerships for the development of tivozanib and AV-353 is also encouraging. We expect investor focus to remain on pipeline updates from the company. AVEO is a Zack Rank #3 (Hold) stock. Some better-ranked stocks in the health care sector include ANI Pharmaceuticals, Inc. ANIP, Retrophin, Inc. RTRX and Bristol-Myers Squibb Company BMY. All three stocks sport a Zacks Rank #1 (Strong Buy). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BRISTOL-MYERS (BMY): Free Stock Analysis Report AVEO PHARMACEUT (AVEO): Free Stock Analysis Report RETROPHIN INC (RTRX): Free Stock Analysis Report ANI PHARMACEUT (ANIP): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research