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Pacira's (PCRX) Q3 Earnings Top Estimates, Revenues Rise Y/Y

Pacira BioSciences, Inc. PCRX reported third-quarter 2019 earnings of 48 cents per share, surpassing the Zacks Consensus Estimate of 34 cents and also the year-ago bottom line of 31 cents.

Total revenues also increased 25% year over year to $104.7 million from the year-earlier number of $83.4 million. Meanwhile, revenues were almost in line with the Zacks Consensus Estimate of $105 million.

Shares of Pacira were up almost 2.5% following earnings announcement on Thursday. However, the stock has lost 0.9% so far this year against the industry’s increase of 3.7%.

Quarter in Detail

Pacira’s top line mainly comprises product revenues, other product sales and royalty revenues.

Expare/bupivacaine liposome injectable suspension sales came in at $101.7, rising 23% year over year. Also, the same inched up 1.9% sequentially. Exparel is a liposome injection of bupivacaine, which is indicated for single-dose administration into the surgical site to produce postsurgical analgesia.

Newly-added product iovera system generated sales of $2.6 million in the reported quarter, reflecting an increase of 30% sequentially.

We remind investors that in April 2019, Pacira acquired the privately held MyoScience, Inc. following which the former added the latter’s iovera system to its portfolio, which is highly complementary to Exparel as a non-opioid therapy. Moreover, upon the closing of the acquisition, Pacira changed its corporate name to Pacira BioSciences, Inc.

Royalty revenues came in at $0.33 million in the reported quarter, down 55% year over year.

Research and development (R&D) expenses (excluding stock-based compensation) surged 36.9% to $18.9 million.

Selling, general and administrative (SG&A) expenses (excluding stock-based compensation) increased 13.3% to $43.4 million in the reported quarter.

2019 Outlook

Pacira provided its guidance for Exparel sales in 2019 and expects the same in the $400-$410 million range. This is intact with the last reported quarter’s estimate.

iovera net product sales are expected in the range of $8- $10 million, unchanged from the previous quarter’s projection.

Adjusted R&D expenses are expected in the band of $60-$70 million while adjusted SG&A expense is anticipated with $180-$190 million. Both are unaltered from the previous guidance.

Recent Developments

In September 2019, Pacira completed enrollment in the phase III study on Exparel for treating pediatric patients aged from six to less than 17 years. The subjects are undergoing spinal or cardiac surgeries. Results from this study will support a supplemental new drug application for Exparel in the United States regarding its label expansion to include children aged six years and above.

We remind investors that in June 2019, the European Medicines Agency (EMA) accepted Pacira’s marketing authorization application (MAA) seeking an approval of Exparel (bupivacaine liposome injectable suspension) as a medicine for postsurgical analgesia. The company expects an opinion from the Committee for Medicinal Products for Human Use (CHMP) in the second half of 2020.

Pacira is advancing Exparel in phase IV studies to expand the drug’s utilization in areas like cesarean section, spine and hip fracture. On the conference call, management stated that it plans to complete enrollment in the phase IV opioid free C-section study known as CHOICE with top-line data expected in January 2020.

Pacira has partnership with Johnson & Johnson JNJ wherein the latter continues to support the uptake of Exparel with the help of its world class educational programs and orthopedic procedural solutions for the former.

Pacira BioSciences, Inc. Price, Consensus and EPS Surprise

Zacks Rank & Stocks to Consider

Pacira currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same sector include Trillium Therapeutics Inc. TRIL and Portola Pharmaceuticals, Inc. PTLA. While Trillium sports a Zacks Rank #1 (Strong Buy), Portola has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Trillium’s loss per share estimates have been narrowed 1.5% for 2019 and 38.5% for 2020 over the past 60 days.

Portola’s loss per share estimates have been narrowed 1.6% for 2019 and 8.2% for 2020 over the past 60 days. The stock has rallied 45.4% year to date.

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