Shares rise for biotech company on hopes for drug

Human Genome stock rises 8% as loss shrinks

February 11, 2004|By William Patalon III | William Patalon III,SUN STAFF

Shares of Human Genome Sciences Inc. jumped nearly 8 percent yesterday after the Rockville biotechnology company buttressed a better-than-expected financial report with upbeat insights into one of its more promising drug candidates.

Human Genome shares jumped 99 cents, or 7.7 percent, to close at $13.85 yesterday on the Nasdaq stock market. Slightly more than 3 million shares traded, almost double the daily average for the past six months of just over 1.6 million shares.

For its fourth quarter, which ended Dec. 31, Human Genome reported a net loss of $48.9 million, or 38 cents per share, smaller than the net loss of $59.8 million, or 46 cents per share, during the comparable quarter in 2002, the company said.

Analysts had expected Human Genome to lose 41 cents per share in the fourth quarter, according to a survey of 14 analysts conducted by Zacks Investment Research.

A one-time license fee from Pfizer Inc. recorded in the fourth quarter boosted revenue for the final three months of last year to $4.6 million. That was almost eight times the $600,000 in revenue reported for the corresponding period in 2002, Human Genome said.

For all of last year, Human Genome reported a loss of $185.3 million, or $1.44 per share. That compared with a net loss of $219.7 million, or $1.71 per share, in 2002.

Revenue last year totaled $8.2 million, up from $3.6 million in 2002, the company said.

Positive news involving LymphoStat-B, a drug for treating rheumatoid arthritis and the most serious form of lupus ignited investor interest yesterday, said Christopher J. Raymond, an analyst who follows Human Genome for Robert W. Baird & Co.

"For this company, it's the project that's probably got the largest potential of all their early-stage [drug] candidates," Raymond said.

Because it's an early-stage drug, however, it's difficult to predict success or failure.

This month, for instance, Human Genome ended development of Repifermin, a drug to treat mouth sores in chemotherapy patients. It was once viewed as a primary product candidate for the company. Clinical trials found that Repifermin was not significantly more effective than a placebo in treating the painful condition.

Human Genome said it's at work on several LymphoStat-B clinical trials. Investors can expect data soon that will serve as a progress report of sorts on the drug, Raymond said. "That's what got [investors] excited," he said.

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