Tekmira Pharmaceuticals Corporation (NASDAQ:TKMR) reported its fiscal second quarter results on Wednesday after the market closed. The company missed Wall Street consensus on revenues and earnings both, sending the stock down 14.25% in after-hours trading.
Tekmira has about $130 million in cash
Tekmira reported a net loss of $6.1 million or 28 cents per share, worse than last year’s Q2 loss of $3 million or 21 cents per share. Revenue plunged to $1.8 million from $2.8 million in the same quarter a year ago. Analysts on average were expecting 26 cents in losses and $3.7 million in revenues. The Canadian company ended the June quarter with $129.5 million in cash and cash equivalents.
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Though the results were disappointing, the current hype around the Ebola epidemic could fuel this volatile stock going forward. All three research firms covering the stock have a Buy/Overweight rating on the stock. Tekmira CEO Dr. Mark J. Murray told investors that the company is evaluating options to use its experimental Ebola treatment to combat the Ebola epidemic in west Africa.
Tekmira’s drug TKM-Ebola hasn’t been formally cleared by regulators. But the U.S. FDA has modified its “clinical hold” stance to enable use of the drug in confirmed or suspected Ebola cases. But it still can’t be used in healthy volunteers for clinical trials as FDA has paused the study, seeking more information about how the drug works.
U.S. Defense Department helping Tekmira develop TKM-Ebola
The company said it was in talks with various government agencies and NGOs, including the World Health Organization, over the potential use of TKM-Ebola to treat the infected individuals. Tekmira is developing its Ebola drug under a contract with the U.S. Department of Defense. Given the severity of the current situation, the company may use its experimental drug within regulatory and clinical protocols.
Murray said at the earnings call that the company has sufficient inventory to go ahead with the Phase I clinical trial. But if regulators or agencies ask it to produce more to meet the market demand, that would take months. Given the current situation, Tekmira is re-thinking its business thesis.