Q3 2024 Earnings: Hold Akebia Therapeutics

seekingalpha11-21

Akebia Therapeutics, Inc.'s stock has surged nearly 35% after positive updates on its Vafseo (vadadustat) and promising third-quarter results, despite macroeconomic challenges.The company is expanding...

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Morsa Images  The biotechnology sector is not a safe investment when interest rates remain high. Investors are wary of holding companies that either lose money or hold high levels of debt. Despite the macroeconomic conditions, the uptrend in shares of Akebia Therapeutics, Inc.  is an encouraging reversal. AKBA stock bottomed at below $1.00 in late June 2024. The","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"AKBA":"Akebia Therapeutics, Inc."},"translate_title":"2024年第三季度收益：持有Akebia Therapeutics","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"AKBA":0.9},"content_text":"Akebia Therapeutics, Inc.'s stock has surged nearly 35% after positive updates on its Vafseo (vadadustat) and promising third-quarter results, despite macroeconomic challenges.The company is expanding its market through partnerships and trials, addressing unmet needs in anemia treatment for CKD patients, and exploring label expansion.Risks include potential competition post-2025 due to patent expiration for Auryxia, but current limited competition and strong brand recognition mitigate this.Akebia shows strong momentum and long-term potential, making AKBA a stock to watch, though profitability is not expected until after fiscal year 2025.   Morsa Images  The biotechnology sector is not a safe investment when interest rates remain high. Investors are wary of holding companies that either lose money or hold high levels of debt. Despite the macroeconomic conditions, the uptrend in shares of Akebia Therapeutics, Inc. (NASDAQ:AKBA) is an encouraging reversal. AKBA stock bottomed at below $1.00 in late June 2024. The stock gained nearly 35% in the last month, closing at nearly $2.00 after posting third-quarter results. What did shareholders like about the company’s latest results? Third-Quarter 2024 Results Akebia, which develops therapeutics for kidney disease, reported revenue of $37.4 million, down by 11.0% Y/Y. It lost $0.10 in earnings per share. Markets responded positively to the firm’s update on its Vafseo (vadadustat). The company said that it is on track for U.S. market availability in January 2025. Look at the earnings surprise summary for a historical review of Akebia's earnings. The results are mixed, as Q3 results did not meet expectations. However, it exceeded expectations four times in the last 12 quarters. Seeking Alpha John P. Butler, Chief Executive Officer of Akebia, said that around 60% of patients on dialysis are covered under dialysis organization and group purchasing organization contracts for Vafseo. As a result, the firm expects to enter contracts with additional dialysis providers for the rest of this year. To expand its addressable market, it partnered with U.S. Renal Care. In the collaborative trial, the organizations will evaluate mortality and hospitalization data for patients on Vafseo. The quarterly report press release also highlighted the firm’s Vafseo Outcomes In-Center Experience trial in September. The VOICE trial will give Akebia important data on mortality and hospitalization from 2,200 patients. It enables the company to educate physicians, supporting the use of Vafseo. The company participated in the ASN Kidney Week conference in October. Based on conversations it had with nephrologists, Akebia recognized there is an unmet need for anemia treatment for patients with CKD. Since they are not on dialysis, the company has a multi-billion-dollar opportunity to treat patients outside the dialysis market. Opportunities Akebia already announced the Vafseo Wholesale Acquisition Cost (or WAC) which is worth $15,500 annually. In addition, it will have commercial supply contracts with volume-based rebates and off-invoice discounts. This should increase sales as prices decline. A label expansion for nondialysis is a possibility after the firm engages with the U.S. Food & Drug Administration this year. First, Akebia requires a Complete Response Letter that discusses its patient group. In the longer term, Akebia will have data for its VOICE trial following the Transitional Drug Add-on Payment Adjustment (“TDAPA”) period. As the study progresses over the next five to six years, positive data could lift the share price. Investors should expect continued strength from Auryxia’s revenue. Not only does the company have contracts in place, but it also noted that providers are looking for bundles. Risks The patent expiration for Auryxia is not until July 21, 2030. Still, out of six abbreviated new drug applications (“ANDA”), none have been conditionally approved. Investors should expect limited competition in 2025, while the firm benefits from stronger access and brand recognition for Auryxia. As a micro-cap company, investors should look at the company’s cash balance and long-term debt. In Q3, the company held cash and cash equivalents of $34.02 million. Long-term debt was $38.36 million. The company estimates its cash runway as “at least two years” with a cash burn of $20 million/quarter. Akebia The firm does not have debt due until 2027. This should give Akebia the time it needs to achieve positive cash flow from operations. Ideally, the firm would pay back its debt when they mature.   Akebia From its cash flow statement, the firm reported a net loss of $46.6 million. The non-cash interest expense and inventory are the two biggest items with a noticeable year-on-year change: Akebia Stock Grade Akebia scores well on growth and profitability. It has a strong momentum grade, thanks to the stock’s recent performance in the past three months. According to Seeking Alpha’s Quant service, it has the second-best ranking among its peers. Seeking Alpha Sangamo Therapeutics (SGMO) has a better sector rank. While its momentum grade is higher than that of AKBA stock, it has a weak growth and profitability grade. Akebia’s peers include 4D Molecular Therapeutics (FDMT), KalVista (KALVA), Prime Medicine (PRME), and Larimar Therapeutics (LRMR). Your Takeaway Akebia is among the biotechnology firms that are not yet profitable. In the last few years, markets increased their investments in dominant firms outside this sector. This includes technology firms with a market capitalization in the trillion-dollar range. While Akebia should achieve positive earnings, analysts do not expect this to happen until after fiscal year 2025. Seeking Alpha  Akebia is a stock to watch. Shareholders who have a position should continue to hold shares for the underlying company’s long-term potential.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"analysis","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2485417871"}