Amarin (AMRN 1.92%), Cubist Pharmaceuticals (CBST +0.00%), and Abaxis (ABAX +0.00%), all posted big after-hours moves yesterday. Let's take a look at what happened to these three stocks overnight and if they're poised to move higher or lower today.
Aftershocks for Amarin continue
Shares of troubled fish oil treatment maker Amarin fell 5.3% after hours yesterday, continuing the stock's decline to all-time lows.
Amarin is still experiencing the aftershocks of its dizzying 60% crash last week, after a Food and Drug Administration advisory panel voted against approving the ANCHOR indication for its only marketed product, the fish oil drug Vascepa. The ANCHOR phase 3 study was intended to expand Vascepa as a treatment for patients with very high triglyceride levels (500 mg/dL or more) to a larger group with lower triglyceride levels (200-499 mg/DL).
That additional indication could have helped Amarin expand its current pool of 4 million patients to an additional 36 million patients, as well as diversify away from its primary competitor, GlaxoSmithKline's (GSK 2.14%) Lovaza, which is only approved to treat patients with very high triglyceride levels. Vascepa is considered a safer treatment, since it doesn't increase LDL ("bad") cholesterol levels as Lovaza does, but Amarin lacks a larger marketing partner to effectively compete against Glaxo. Amarin also expects to face generic competition soon from upcoming generic versions of Lovaza from Teva Pharmaceutical and Par Pharmaceutical.
Amarin recently announced that it would fire approximately half of its workforce in order to preserve the $226 million in cash it currently has on hand.
Cubist slides after mixed earnings
Cubist Pharmaceuticals also slid after hours yesterday, shedding 4.8% of its value after reporting mixed third-quarter earnings.
Cubist reported adjusted earnings of $0.41 per share -- a big drop from the $0.62 per share it reported in the prior-year quarter, which nonetheless topped the consensus estimate of $0.35 per share. Revenue rose 12% year-over-year to $266 million, but fell short of the $269 million that analysts surveyed by Thomson Reuters had expected.
The lion's share of Cubist's revenue (91%) comes from Cubicin, an injectable version of daptomycin, an antibiotic used to treat Gram-positive infections. 95% of Cubicin sales come from the United States, with the remainder coming from international markets.
Besides Cubicin, Cubist generates revenue from sales of Entereg (for postoperative bowel disorders) and co-promotion service revenues for Dificid (for Clostridium difficile-associated diarrhea). Sales of Entereg, which it acquired from the acquisition of Adolor in 2011, jumped 36% year-over-year to $13.7 million. Service revenues from Dificid came in at $3.8 million. During the quarter, Cubist also received a $5 million milestone payment from Novartis related to Cubicin during the quarter.
Unlike Amarin's fundamental predicament, Cubist's drop appears to be more of a temporary pullback, since the stock has already risen 17% over the past three months and 45% over the past twelve.
Abaxis enjoys a post-earnings boost despite a big drop in profit
Last but not least, a bit of good news: Shares of Abaxis, which develops veterinary instruments and point-of-care blood test kits, surged 5% after hours yesterday after it reported mixed second-quarter earnings.
Abaxis earned $0.18 per share, a steep drop from the $0.58 per share it reported in the prior-year quarter, which missed the Thomson Reuters' consensus estimate of $0.21 per share. However, revenue rose 4% year-over-year to $45.85 million.
Total sales in the veterinary market, which accounts for 83% of the company's top line, rose 8% to $37.9 million, while sales of its much smaller business of chemistry analyzers and hematology instruments climbed 17% to $1.9 million.
A major concern for Abaxis shareholders has been its collaboration with Abbott Laboratories (ABT 1.46%). Last quarter, Abaxis signed a multi-year distribution with Abbott to distribute the Piccolo Xpress portable clinical chemistry system and its one-time use reagent discs in the United States and China. According to CEO Clinton Severson, Abaxis pulled out of the Chinese market last quarter, due to "changes in reimbursement" and "interest in having Abbott focus on the U.S. market."
Investors didn't take that news very well, since the Chinese market was expected to substantially boost the growth of its human instruments division. Despite the recent post-earnings boost, shares of Abaxis are still down more than 20% over the past three months.
