It’s been an active first few weeks on the job for new Avid Bioservices Inc. Chief Executive Nicholas Green.
The nearly $400 million-valued firm (Nasdaq: CDMO), which has changed its focus from developing its own drugs to contract manufacturing for other drugmakers over the past two years, beat analyst estimates in its fiscal first quarter and won three new contracts within a 20-day period in August.
“The first quarter was particularly strong as we significantly exceeded revenue expectations as well as other key metrics,” Green told analysts on a Sept. 1 conference call for the fiscal first quarter that ended July 31.
Green took over the top role at Tustin-based Avid on July 30, replacing interim CEO Rick Hancock.
“In business development, we expanded our customer base with the addition of three new customers, each of which brings an exciting new project to the manufacturing portfolio.”
The firm last month announced agreements with San Carlos-based Iovance Biotherapeutics Inc. (Nasdaq: IOVA); Tampa, Fla.-based Oragenics Inc. (NYSE: OGEN); and San Diego-based Mapp Biopharmaceutical Inc.
Oragenics is developing a COVID spike protein vaccine candidate, Terra CoV-2, which is expected to begin human clinical trials by early 2021.
Another COVID-related endeavor comes from Mapp Biopharmaceutical, where efforts are focused on developing a human monoclonal antiviral antibody.
If effective, this type of treatment could replace antibody therapeutics delivered via convalescent plasma from recovered patients.
‘Significant Opportunity’
Avid, formerly known as Peregrine Pharmaceuticals, ditched its drug testing business in 2018 after a Phase 3 trial failed.
It now concentrates on manufacturing biologics for other biopharmaceutical firms. Pills are swallowed and ingested; biologics, which can’t survive a trip through the stomach, are injected.
“My first month has only strengthened my belief that Avid is a state-of-the art business with significant opportunity for growth,” Green said in a statement. “This is especially true given our focus on biologics, which is one of the fastest-growing sectors of the industry.”
Green also told analysts that he is still reviewing a strategy to determine where else to expand.
The company’s operations along Myford Avenue, now totaling 158,000 square feet in four buildings, can be expanded if business warrants, officials said.
Operations there now can support about $100 million in annual revenue; with upgrades that figure could be boosted to nearly $250 million, officials told analysts.
In its first-quarter earnings, the company reported $25.4 million in revenue, which beat the average estimate of two analysts for $16.5 million. It also recorded an adjusted profit of 6 cents per share, topping the average analyst estimate for a loss of 7 cents.
After the results were released, its shares reached a 52-week high of $9.10 on Sept. 2. However, in the following week they dropped to $6.91 a share with a $389 million market cap at press time. Its shares have still more than doubled since a 52-week low of $3.02 on March 23.
Avid reiterated 2021 annual revenue guidance for $76 million to $81 million. The average estimate of two analysts is revenue of $80.9 million.
