Top Small-cap Alert – Aeterna Zentaris Responds anemically to Positive Results of AEZS-108 Studies
  • Stock Alert for AEterna Zentaris Inc. (AEZS)
  • Stock Alert for AEterna Zentaris Inc. (AEZS)
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    Stock Alert for AEterna Zentaris Inc. (AEZS)

    AEterna Zentaris Inc. (USA), (AEZS) is a global biopharmaceutical company focused on endocrine therapy and oncology. The Company’s product pipeline encompasses compounds at all stages of development, from drug discovery through marketed products. The products of the Company include Cetrorelix, AEZS-108, Perifosine, Ozarelix, AEZS-112 and AEZS-130. On March 31, 2008, the Company completed the selling of the Company’s product Impavido to Paladin Labs Inc. (Paladin). On March 5, 2009, the Company entered into a development, commercialization and license agreement with sanofi-aventis for the development, registration and marketing of cetrorelix in benign prostatic hyperplasia (BPH) for the U.S. market.

    AEterna Zentaris Inc. was founded in 1991 and is headquartered in Quebec City, Canada.

    Share Statistics (Sept-29-10) FY

    2008

    FY

    2009

    %

    Chg

    Q2 2009 Q2 2010 %

    Chg

    Symbol AEZS Revenue, $Mn 38.48M 63.24M 64.3% 8.38M 5.58M 33.4%
    Current price $1.38 Gross marg. 49.2% 73.9% 50.2% 45.8% 20.8% 54.6%
    52wk Range: $2.19-0.75 Oper. margin -162.1% -37.9% 77.6% -146.1% -136.0% 6.9%
    Avg Vol (3m): 1,454,180 Net margin -145.7% -26.5% 81.8% -152.6% -109.1% 28.5%
    Market Cap. 114.73M
    Shares Outst. 83.1M EPS, $ -1.12 -0.43 61.6% -0.24 -0.06 75.0%

    Source: Reuters.com, SEC Filings.

    Financial Summary

    Revenues were $5.6 million for the three-month period ended June 30, 2010, compared to $8.4 million for the same period in 2009. The decrease is due mainly to the absence, in 2010, of amortization of an upfront license fee payment related to the agreement with sanofi-aventis U.S. LLC, which was entered into in March 2009 and subsequently terminated, in connection with AEZS now discontinued development program involving cetrorelix for the treatment of benign prostatic hyperplasia (“BPH”).

    Research and development (“R&D”) costs, net of tax credits and grants, were $5.0 million for the three-month period ended June 30, 2010, compared to $12.1 million for the same period in 2009. The comparative decrease in net R&D costs is primarily attributable to the winding down and termination of development activities related to cetrorelix in BPH.

    Net loss was $4.5 million, or $0.06 per basic and diluted share, for the three-month period ended June 30, 2010, compared to $13.1 million, or $0.24 per basic and diluted share, for the same period in 2009. This decrease is mainly related to lower comparative net R&D costs and higher foreign exchange gains, which resulted largely from the comparative weakening in 2010 of the euro vis-à-vis the Canadian and U.S. dollar, partly offset by the comparative decrease in revenues, as discussed above.

    Cash and cash equivalents were $45.3 million as at June 30, 2010.

    Financial Strength (Sept-29-2010) Company Industry Sector S&P 500
    Quick Ratio (MRQ) 3.43 3.13 1.89 0.82
    Current Ratio (MRQ) 3.68 3.39 2.27 0.99
    Long-Term Debt to Equity(MRQ) 0.50 11.23 17.61 127.03
    Total Debt to Equity (MRQ) 0.75 14.96 23.07 183.12

    Source: Reuters.com, SEC Filings.

    Analyst Consensus

    This is the consensus forecast among seven polled investment analysts. Against the AEterna Zentaris Inc company.

    Analyst Detail Buy Outperform Hold Underperform Sell No Opinion
    Latest 3 1 2 1 0 0
    4 weeks ago 3 1 2 1 0 0
    2 months ago 3 1 2 1 0 0
    3 months ago 3 1 2 1 0 0
    Last year 1 1 4 1 0 0

    Source: www.ft.com

    Consensus Estimates Analysis

    # of Estimates Mean High Low 1 Year Ago
    SALES (in millions)
    Quarter Ending Sep-10 2 5.50 5.51 5.49 8.90
    Quarter Ending Dec-10 2 5.44 5.54 5.34 8.90
    Year Ending Dec-10 5 22.78 31.70 15.00 31.47
    Year Ending Dec-11 4 17.50 22.77 12.30 32.37
    EARNINGS (per share)
    Quarter Ending Sep-10 3 -0.10 -0.08 -0.12 -0.06
    Quarter Ending Dec-10 3 -0.10 -0.07 -0.14 -0.05
    Year Ending Dec-10 6 -0.38 -0.30 -0.51 -0.60
    Year Ending Dec-11 5 -0.39 -0.29 -0.59 -0.54

    Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=AEZS.O

    Investment Highlights

    AEZS will be presented at the upcoming 5th International Congress of the GRS-IGF Society, which will be held October 3 through October 7, 2010, in New York City. AEZS-130 (macimorelin, Solorel(TM)) is currently in a phase III trial as a diagnostic test for growth hormone deficiency in adults.

    The Company also announced that its president and CEO, Juergen Engel, Ph.D., will present a corporate overview at BioContact Québec on Wednesday, October 6, 2010, at 9:30 a.m. (eastern) in the Frontenac Room of the Fairmont Château Frontenac in Quebec City, Canada.

    AEZS recently announced that its president and CEO, Juergen Engel, Ph.D., will be part of the Oncology Investment panel session at the upcoming Sachs 10th Annual Biotech Europe Investment Forum on Wednesday, September 29, 2010, at 12 p.m. (local time), at the Radisson Blu Hotel in Zurich, Switzerland.

    That same day, still as part of the Forum, Dr. Engel will also present a corporate overview at 2:15 p.m.

    Pipeline Development

    Perifosine

    – April 5, 2010: Perifosine receives U.S. Food and Drug Administration Fast Track Designation for the phase III X-PECT (Xeloda(R) + Perifosine Evaluation in Colorectal cancer Treatment) registration trial.

    – April 8, 2010: Initiation of the registration phase III X-PECT study with perifosine.

    – April 15, 2010: Positive Scientific Advice from the European Medicines Agency for the phase III program with perifosine in multiple myeloma. Therefore, the ongoing trial is expected to be sufficient for registration in Europe.

    – April 20, 2010: Presentations at the annual meeting of the American  Association for Cancer Research  in Washington, D.C. of preclinical data from a study sponsored by the National Institutes of Health with perifosine in oncology.

    – May 17, 2010: Publication of an article in the May 12, 2010, issue of the Journal of the National Cancer Institute, entitled “In Vitro and In Vivo Inhibition of Neuroblastoma Tumor Cell Growth by Akt Inhibitor Perifosine,” demonstrating the single agent activity of perifosine in neuroblastoma tumor preclinical models.

    – June 7, 2010: Presentation at the American Society of Clinical Oncology annual meeting of Phase I data on single agent perifosine in the treatment of recurrent pediatric solid tumors, including patients with advanced brain tumors and neuroblastoma.

    – June 8, 2010: Report at the ASCO annual meeting of phase II results confirming a statistically significant improvement in both time to tumor progression and overall survival with perifosine, in combination with capecitabine (Xeloda(R)), in the treatment of advanced metastatic colorectal cancer.

    – June 29, 2010: EMA issues positive Scientific Advice for phase III trial with perifosine in colorectal cancer. Therefore, the ongoing trial is expected to be sufficient for registration in Europe.

    AEZS-108

    – May 6, 2010: Received orphan drug designation from the FDA for AEZS-108, the Company’s doxorubicin targeted conjugate compound, for the treatment of ovarian cancer.

    – May 12, 2010: Received approval from the FDA for the Company’s Investigational New Drug application for AEZS-108 in luteinizing hormone-releasing hormone receptor-positive urothelial (bladder) cancer.

    – May 17, 2010: Received positive opinion for orphan medicinal product designation from the Committee for Orphan Medicinal Products of the EMA, for AEZS-108 for the treatment of ovarian cancer.

    – June 7, 2010: Presentation at ASCO’s annual meeting of positive efficacy and safety data for AEZS-108 in ovarian cancer.

    – June 28, 2010: Announcement of a collaboration with Almac Group Ltd.’s (“Almac”) Diagnostic division to develop a companion diagnostic for AEZS-108 in cancer.

    AEZS-130 (Solorel(TM))

    – June 21, 2010: Presentation at the 92nd Annual Endocrine Society Meeting and Expo of positive data on AEZS-130, a ghrelin mimetic for diagnostic and therapeutic use.


    AEZS-131 and 132

    – April 20, 2010: Presentations at AACR’s annual meeting in Washington, D.C., of preclinical data on Erk inhibitor, AEZS-131, and on Erk/PI3K dual inhibitor, AEZS-132.

    Corporate developments

    – April 20, 2010: Completion of a $15.0 million registered direct offering with certain institutional investors.

    – April 23, 2010: Regained compliance with Nasdaq’s minimum bid price listing requirement.

    – June 21, 2010: Completion of a $12.1 million registered direct offering with certain institutional investors.

    Subsequent to Quarter-End

    – July 8, 2010: Presentation at the 7th International Congress of Neuroendocrinology in Rouen, France, of a scientific poster entitled, “Use of the Orally Active Ghrelin Mimetic AEZS-130 as a Simple Test for the Diagnosis of Growth Hormone (GH) Deficiency (GHD) in adults (AGHD)”.

    – July 14, 2010: Perifosine receives orphan drug designation by the FDA for the treatment of neuroblastoma, a cancer of the nervous system affecting mostly children and infants for which there are no FDA approved therapies.

    Source: http://www.aezsinc.com/

    Technical Analysis

    Source: http://stockcharts.com

    AEZS is trading above its 13-day moving average. This is considered to be the sign of a bullish trend. There is added weight to this indication because the moving average is rising and suggests that there has been buying interest in this stock.

    AEZS is trading near its upper Bollinger Band. This suggests that the stock price is high relative to its recent price action.

    The MACD for AEZS currently indicates a strong bullish signal for two reasons. First, the MACD is above the signal line, a 9-day moving average. Second, the MACD is above 0 which implies that the underlying moving averages are trending higher.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Aug31-2010 symbol Share, $ $ Mn 2010 2011 2010 2011
    Helix Biopharma Corp. HBP 2.54 152.07M n/a n/a 40.68 n/a
    Protox Therapeutics Inc. PRX 0.42 40.45M n/a n/a n/a n/a
    Spectrum Pharmaceuticals Inc. SPPI 4.06 203.57 n/a n/a 5.35 n/a
    Drug Manufacturers Median 132.03M n/a n/a 20.01 n/a
    AEterna Zentaris Inc. AEZS 1.38 114.73M n/a n/a 1.70 n/a

    Source: Thomson Financial

    Insider Trading Activity

    NET SHARES PURCHASE ACTIVITY

    Inside Purchases – Last 6 Months

    Shares Transaction
    Purchases n/a n/a
    Sales n/a n/a
    Net Shares Purchased (Sold) n/a n/a
    Total Insider Shares Held n/a n/a
    % Net Shares Purchased (Sold) n/a n/a

    Net Institutional Purchases — Prior Qtr to Latest Qtr
    Shares
    Net Shares Purchased (Sold) n/a
    % Change in Institutional Shares Held n/a

    Source: Yahoo Finance

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