Dallas, Texas 11/05/2013 (Financialstrend) – The $90.72 million small cap biotech player Zalicus Inc. (NASDAQ:ZLCS) reported disappointing earnings numbers from its 3Q operations. This pulled the stock down by 7.7% during trading yesterday.
The downward pressure on the stock persisted in spite of Zalicus management trying to talk up the stock by announcing that it was well on course to announce results from two trails before December this year. The results from the clinical trials for its target drug codenamed Z160 to treat ailments including “lumbosacral radiculopathy and postherpetic neuralgia” are expected to propel the company’s efforts to come out with a marketable drug in a big way. The development stage drug firm also announced that it would take up the phase 2 trial of Z944 in early 2014 following “positive results of the Z944 Phase 1b Laser-Evoked-Potentials study’.
The lack of investor confidence in the stock was brought upon by the close to loss per share of $0.46 and revenue brought in at $3.4 million. Revenue was down by $0.1 million from 3QFY12. A large chunk of the revenue was accounted for by the $1.5 million royalty that the firm received from drug distribution company Mallinckrodt plc on sale of drug “Exalgo®”. Both the earnings and revenue reported were well below the market expectations, leading to the prospects of the stock taking a downward turn.
Post the stock loosing market value in the backdrop of 3Q results announcement, 1.7 million of the stock changed hands as against a daily average of 0.9 million. At these depressed valuations, the stock was trading 49% below its 52 week low pricing at $4.18 per share. This was well below the price target set by analysts at $12 per share.
In the past 12 months, the company had posted net sales of $14.9 million with net loss of $39 million.