Quarterly results are particularly important for biopharmaceutical companies with only one drug on the market and no meaningful drug pipeline to speak of. Therefore, investors in shares of CubistPharmaceuticals (NASDAQ:CBST) need to pay attention whenever the company announces sales results for its lead drug, Cubicin, an antibiotic used to treat difficult infections resistant to current therapies, as the company did earlier this week.

Following an expanded approval to treat additional types of infections in May, Cubist has started to show a renewed ramping up of Cubicin sales in the past two quarters. Cubist just had its first quarter of positive earnings of $5.2 million, or $0.09 a share. That compares favorably to the $4.5 million loss the company incurred at this time last year. For the first nine months of the year, Cubist has had positive cash flows of $10 million.

Cubicin Sales*

Q-O-Q Growth

Y-O-Y Growth

Q4 06**




Q3 06




Q2 06




Q1 06




Q4 05




*in millions

A round of financing earlier in the year netted Cubist $350 million. Almost half of that amount was used to pay off high-interest-rate convertible debt, but now the company should be solidly profitable going forward. With $282 million in cash just sitting on the balance sheet, it will be interesting to see how Cubist uses that money to build out its drug pipeline.

The potential market for Cubicin is more than $500 million at present, and estimates suggest that Cubicin has penetrated approximately only 15% of its potential markets. That leaves a lot of room for growth of the drug, and Cubist is attempting to ensure that this growth will continue for a long time, running more clinical trials with the drug to expand its label.

If Cubicin sales growth ever stops, Cubist will be in some trouble, unless it can bring other drug candidates into the fold. With so many companies fighting to acquire so few drugs, it might just be easier for Cubist to sell itself to a more substantial pharmaceutical company.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool has a disclosure policy .