Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) Outlines Next Steps for Recovery


Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) recently pushed above its 200-day simple moving average for the first time in 2017 after announcing its latest financial data. ARWR reported a net loss for the 3 months ended June 30, 2017 of -$5.3 million or $0.07 per share based on 74.8 million weighted average shares outstanding. This compares with a net loss of $19.4 million or $0.32 per share based on 60 million weighted average shares outstanding for the 3 months ended June 30, 2016. Revenue for the 3 months ended June 30, 2017 was $9.4 million compared to $40,000 for the 3 months ended June 30, 2016.

On ARWR’s conference call, “This increase is driven by the upfront payments we received from our collaboration agreements with Amgen and these payments will continue to be recognized as revenue over the next several quarters. Total operating expenses for the 3 months ended June 30, 2017 were [$14.9 million] compared with $19.4 million for the 3 months ended June 30, 2016. The decrease is driven by the discontinuation of the clinical trials related to our previous clinical candidates.”

Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) trumpets itself as a company that develops novel drugs to treat intractable diseases in the United States. Its pre-clinical stage drug candidates include ARO-HBV to treat chronic hepatitis B virus infection; ARO-AAT to treat liver disease associated with alpha-1 antitrypsin deficiency; ARO-LPA to reduce production of apolipoprotein A; ARO-AMG1, which is developed against an undisclosed genetically validated cardiovascular target; and ARO-F12, a potential treatment for factor 12 mediated diseases, such as hereditary angioedema and thromboembolic disorders.

The company also develops ARO-HIF2, a drug candidate for the treatment of clear cell renal cell carcinoma. Arrowhead Pharmaceuticals, Inc. has collaboration and license agreements with Amgen, Inc.

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According to company materials, “Arrowhead Pharmaceuticals develops medicines that treat intractable diseases by silencing the genes that cause them. Using a broad portfolio of RNA chemistries and efficient modes of delivery, Arrowhead therapies trigger the RNA interference mechanism to induce rapid, deep, and durable knockdown of target genes. RNA interference, or RNAi, is a mechanism present in living cells that inhibits the expression of a specific gene, thereby affecting the production of a specific protein. Arrowhead’s RNAi-based therapeutics leverage this natural pathway of gene silencing.”

As noted above, ARWR hit the wires with its Q3 report. The highlights from the conference call were focused on the company’s pipeline, where management provided a number of interesting insights.

“Over the last quarter, we have focused on meeting the aggressive timelines we set internally for our development programs while continuing with disciplined cash management. We are excited about our new platforms, our lead drug candidates are progressing rapidly towards the clinic, and our partnership with Amgen continues to be highly productive. These are all important steps for us as a company and give us confidence to push forward with our new and diverse pipeline of RNAi therapeutics….Since we made the decision in November of 2016 to discontinue development of prior generation drugs ARC-520, ARC-521 and ARC-AAT that utilize the EX1 delivery vehicle, we have been quiet about data on our new platform and the drug candidates being built upon it. Our plan has been to hold an Analyst R&D Day to provide a comprehensive update about the technology in our lead programs. We think the most effective time to hold this event is when our data across multiple programs have sufficiently matured and when we are in reasonable proximity to filing with the regulators to start first in human studies, we are just about there.”

Recent action has seen 40% piled on for shareholders of the name during the trailing month, but that move comes in the context of a larger bearish trend. The situation may be worth watching. ARWR has evidenced sudden upward volatility on many prior occasions. In addition, the stock has seen an influx in interest of late, with the stock’s recent average trading volume running 16% above the average volume levels in play in this stock over the longer term.

At this time, carrying a capital value in the market of $152.02M, ARWR has a significant war chest ($38.4M) of cash on the books, which stands against about $205K in total current liabilities. ARWR is pulling in trailing 12-month revenues of $22.7M. In addition, the company is seeing major top line growth, with y/y quarterly revenues growing at 23502.3%. We will update the story again soon as developments transpire. For continuing coverage on shares of $ARWR stock, as well as our other breakout stock picks, sign up for our free newsletter today and get our next hot stock pick!

Disclosure: We hold no position in $ARWR, either long or short, and we have not been compensated for this article.


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