Source: Halozyme

What: After reporting second quarter financial results, shares in Halozyme (NASDAQ:HALO) increased by 10% earlier today.

So what: Halozyme reports that revenue jumped to $43.4 million in the second quarter from $18.4 million the year before thanks to a $23 million upfront payment from AbbVie tied to a recent collaboration deal for the use of Halozyme's subcutaneous delivery technology with AbbVie's intravenous drugs.

Halozyme also reports that its R&D expenses and general and administrative expenses totaled $21.2 million last quarter, up from $18.6 million a year ago, and $9.8 million, up from $8.8 million a year ago, respectively.

Overall, Halozyme finished June with $140.7 million in cash, and based on its newly-revised guidance for cash burn of between $20 million and $30 million this year that should be plenty. Halozyme forecasts it will exit 2015 with between $105 million and $115 million leftover.

Now what: Halozyme's second quarter financial results don't raise any red flags, and the company's guidance suggests it has the financial legroom necessary to usher its pancreatic cancer treatment PEGPH20 into late stage trials.

In June, Halozyme released compelling interim trial results from its PEGPH20 phase 2 trial showing progression free survival rates and overall response rates in patients taking PEGPH20 alongside Abraxane and gemcitabine were double the rates of those taking Abraxane and gemcitabine alone.

Those results support the company's plans to kick-off a phase 3 trial for PEGPH20 early next year; however, investors should remember that 40% of phase 3 trials fail, and that means that Halozyme is far from a risk-free investment. That being said, Halozyme's potential to enjoy increasing royalty revenue tied to its licensing deals does offer some insulation against a PEGPH20 failure, and for that reason, Halozyme might be worth keeping an eye on.