Apellis Pharmaceuticals reported better-than-expected Syfovre sales on Monday, but APLS stock crashed as safety issues continue to plague the eye drug.
During the June quarter, Apellis' treatment for geographic atrophy brought in $67.3 million in sales. That handily beat expectations for $25 million to $34.1 million, Needham analyst Joseph Stringer said in a report to clients.
But safety issues persist. Earlier this month, the American Society of Retina Specialists posted a notice that a small number of patients experienced eye inflammation called occlusive vasculitis after receiving a Syfovre injection.
"While the second-quarter number was strong, we think the rate of serious retinal vasculitis safety concerns will remain a dominant overhang on the stock over the next several months as investors await more safety updates and more clarity on likely causes," Stringer said.
On today's stock market, APLS stock plummeted 19.6% to close at 25.75.
APLS Stock: Seven Total Cases, Company Says
Since Syfovre's launch, seven patients have experienced retinal vasculitis, Apellis said in a news release. That includes four occlusive cases, meaning patients lost some of their vision.
Each incident occurred seven to 13 days following the first injection, Needham's Stringer said. To date, two of those seven have recovered their vision. Two patients still have severe visual impairment and three cases are still evolving.
So far, Apellis has shipped 68,000 vials of Syfovre.
"Some vial returns have occurred, but management characterized the number as 'very small,' " Stringer said. "Management surveyed retinal specialists from July 20-22. About one-third plan to use Syfovre in new and treated patients, one-third plan to use in treated patients only and about one-third plan to pause use until further safety info is available."
Stringer kept his buy rating on APLS stock, but cut his price target to 60 from 110.
Syfovre Sales Expected To Be Bumpy
In other numbers, total sales came in at $95 million, easily topping forecasts for $69 million, Wedbush analyst Laura Chico said in a report. That includes sales from Empaveli. Empaveli treats a life-threatening blood disease called paroxysmal nocturnal hemoglobinuria.
Chico kept her neutral rating on APLS stock, but trimmed her price target to 32 from 40.
She expects Syfovre sales to be "bumpy" in the near-term.
"It will take time to understand the 'real' Syfovre event rate," she said.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
