AVEO Oncology Shares Gain 21.4% on Upbeat FOTIVDA Revenues & Outlook

AVEO Oncology (NASDAQ: AVEO) shares jumped 21.4% on March 21, after the commercial stage oncology-focused biopharmaceutical company posted a better-than-feared Q4 loss and an impressive jump in its revenues.

Driven by an upsurge in FOTIVDA revenues coupled with an upbeat outlook for FOTIVDA revenues for FY2022, revenue gained by 22 times.

Q4 Numbers

AVEO Oncology reported an adjusted loss of $0.21 per share, which was better than the street’s estimated loss of $0.29. Furthermore, it was a significant improvement over the previous year’s loss of $0.44 per share.

Similarly, revenues jumped 22 times to $17.6 million compared to a mere $0.89 million in the prior-year quarter. However, revenues modestly fell short of consensus estimates of $17.93 million.

The increase in revenues reflected a surge in FOTIVDA U.S. Net Product Revenue, which increased to $16.75 million versus zero revenues in the prior-year quarter.

Positive Outlook for FOTIVDA

Since FOTIVDA’s commercial launch on March 22, 2021, it has generated revenue of $38.9 million.

Concurrent with the earnings release, the company stated that FOTIVDA continues to demonstrate the durability of disease control and a positive trend for overall survival in the third- and fourth-line treatment setting. This was evident in the long-term data from the pivotal TIVO-3 study presented at the 2022 American Society of Clinical Oncology Genitourinary Cancers Symposium (ASCO GU) last month.

Longer-term, management added, “As we look ahead to 2022 and beyond, we remain confident that FOTIVDA has the potential to become a standard of care for adult patients with relapsed or refractory (R/R) advanced renal cell carcinoma (RCC) that have received two or more prior systemic treatments.”

Notably, AVEO forecast FOTIVDA U.S. net product revenues to range between $100 million and $110 million for the full year 2022. Furthermore, AVEO projects gross margins to continue to be in the mid-to-high 80th percentile in 2022.

CEO Comments

AVEO CEO, Michael Bailey, commented, “As we look to 2022, we expect to build on our commercial momentum by continuing to expand our prescriber base and increase the utilization of FOTIVDA in the third-line setting. We believe we made significant progress on both fronts in 2021 and look to build on this momentum in 2022.”

Wall Street’s Take

Following the Q4 results, Jones Trading analyst Soumit Roy initiated coverage on AVEO Pharmaceuticals with a Buy rating and a price target of $12 (161.44% upside potential).

Consensus among analysts is a Strong Buy based on 3 unanimous Buys. The average AVEO Pharma stock forecast of $13.50 implies 194.12% upside potential to current levels, at the time of writing.

Investors Weigh In

TipRanks’ Stock Investors tool shows that investors currently have a Very Positive stance on AVEO Pharma, with 5.5% of investors increasing their exposure to AVEO stock over the past 30 days.

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