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Here's Why AnaptysBio, Inc. Slipped on Friday

Cory Renauer, The Motley Fool
Updated

What happened

Shares of AnaptysBio, Inc. (NASDAQ: ANAB), a clinical-stage biotechnology company with a focus on treating inflammation, fell following a third-quarter earnings report released after the bell on Thursday. Despite a lack of significant news, the stock fell 11.1% on Friday.

So what

AnaptysBio reported $5 million in revenue during the third quarter of 2018, which came entirely from Tesaro (NASDAQ: TSRO), a collaboration partner that advanced TSR-042 into a phase 3 trial earlier this year. Tesaro's contribution didn't do much to offset rising operating expenses, and AnaptysBio reported a $16.8 million loss during the three months ended Sept. 30.

Angry stock trader looking at computer screens.
Angry stock trader looking at computer screens.

Image source: Getty Images.

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AnaptysBio is still in early development stages and hasn't started holding earnings calls with analysts yet. If it had, analysts may have questioned the company's willingness to begin a 100-patient study as a treatment for adults with chronic rhinosinusitis exacerbated by nasal polyps (CRSwNP) without human proof of concept data from a smaller trial.

Now what

AnaptysBio thinks (CRSwNP) affects around 1.3 million adults in the U.S. and around a third need more than standard care. If the Eclipse study with the drug etokimab succeeds, this company's $1.7 billion market cap could soar. Etokimab's early results with severe asthma patients were encouraging, and there's an association with CRSwNP, but we won't be able to pin any significant value to the drug candidate for this indication until the company presents top-line results in the second half of 2019.

The last half of 2019 will be an exciting one for AnaptysBio's wholly owned candidates. In addition to etokimab's CRSwNP results, investors can also look forward to data from the 300-patient Atlas study with eczema patients. The company's second wholly owned candidate in clinical stage trials, ANB019, is also expected to produce initial results for two inflammatory conditions in need of new treatment options: generalized pustular psoriasis and palmoplantar pustulosis.

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Cory Renauer has no position in any of the stocks mentioned. The Motley Fool recommends AnaptysBio. The Motley Fool has a disclosure policy.