Summary of Enanta Pharmaceuticals (ENTA) 2025 Conference Call Company Overview - Enanta Pharmaceuticals is historically a virology infectious disease company and has recently expanded into immunology [2][3] Key Focus Areas Virology - Enanta is focusing on respiratory virology, particularly on the development of **zelicapavir**, an N protein inhibitor for treating RSV (Respiratory Syncytial Virus) [3][4] - Pediatric data was reported in December, showing safety and pharmacokinetics (PK) as primary objectives, with encouraging early data on a new observer-reported outcome tool called **Bresolve P** [4] - A high-risk adult study has been completed with 180 patients enrolled, focusing on symptomatic endpoints related to lower respiratory tract disease [5][6] - The primary objective is to demonstrate a clinically meaningful reduction in symptom duration, aiming for a reduction of about one day or more [7][8] - Enanta plans to move into a phase three study based on the effect size determined in the phase two proof of concept study [8][9] Immunology - Enanta has two announced programs in immunology: one targeting **wild type KIT** and the other focusing on **STAT6 inhibition** [9][10] - The development candidate for the KIT program is expected to enter IND (Investigational New Drug) enabling work soon [10] - The STAT6 program aims to develop an oral small molecule that could replicate the clinical benefits of Dupixent, which works through the IL-4 and IL-13 signaling pathway [11][12] - Early data shows good target engagement and anti-inflammatory profiles in preclinical models [13][14] Strategic Considerations - Enanta is considering partnerships to advance its RSV programs, with a focus on bringing forward two replication inhibitors with different mechanisms [21][22] - The company is aware of the challenges in demonstrating statistically significant benefits in viral kinetics and symptom reduction in RSV studies [18][48] - Historical data suggests that a one-day symptom improvement is clinically meaningful and aligns with expectations for respiratory drugs [24] Patient Population Insights - The current study focuses on high-risk adults aged 65 and older, with 80% of participants having significant comorbidities [35][36] - The enrollment strategy has shifted to capture patients earlier in their symptom onset to improve the chances of demonstrating drug efficacy [30][41] Data and Efficacy Expectations - The company anticipates that the phase two study may not achieve statistical significance with a one-day benefit but aims to gather data to inform a larger phase three study [48][51] - Viral load reductions are expected to be compared to placebo, with previous studies showing about a log reduction at the end of treatment [51][52] Conclusion - Enanta Pharmaceuticals is actively advancing its pipeline in both virology and immunology, with a strategic focus on partnerships and data-driven decision-making to navigate the complexities of drug development in challenging therapeutic areas like RSV and asthma [22][78]

Core Viewpoint - Enanta Pharmaceuticals (ENTA) has seen a 5.1% increase in share price over the past four weeks, closing at $5.18, with a mean price target of $15 indicating a potential upside of 189.6% according to Wall Street analysts [1][11]. Price Targets and Analyst Estimates - The mean estimate consists of six short-term price targets with a standard deviation of $7.27, indicating variability among analysts; the lowest estimate suggests a 3.5% decline, while the highest predicts a 344% increase to $23 [2][9]. - Analysts' price targets are often viewed with skepticism due to historical inaccuracies, as they may not reliably indicate future stock price movements [7][10]. - A low standard deviation in price targets suggests a strong consensus among analysts regarding the stock's price direction, which can serve as a starting point for further research [9]. Earnings Estimates and Analyst Sentiment - Analysts have shown strong agreement in revising ENTA's earnings estimates upward, which correlates with potential stock price increases; the Zacks Consensus Estimate has risen by 26.2% over the past 30 days [4][12]. - ENTA holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate factors, indicating a solid potential upside [13].

PART I. Unaudited Financial Information [Item 1. Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) The company reported net losses of $22.6 million and $44.9 million for the three and six months ended March 31, 2025, respectively, with total assets at $323.0 million and $30.3 million in cash used in operations [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $323.0 million as of March 31, 2025, from $376.7 million, primarily due to reduced marketable securities, while liabilities and equity also declined Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | September 30, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $60,213 | $37,233 | | Short-term marketable securities | $133,162 | $210,953 | | **Total current assets** | **$242,860** | **$299,852** | | **Total assets** | **$322,993** | **$376,652** | | **Liabilities & Equity** | | | | Total current liabilities | $45,947 | $57,535 | | Liability related to the sale of future royalties (non-current) | $125,379 | $134,779 | | **Total liabilities** | **$229,455** | **$247,838** | | **Total stockholders' equity** | **$93,538** | **$128,814** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net loss for the three months ended March 31, 2025, narrowed to $22.6 million on $14.9 million revenue, primarily due to lower operating expenses, with the six-month net loss also improving to $44.9 million Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Royalty revenue | $14,926 | $17,054 | $31,885 | $35,057 | | Research and development | $28,065 | $35,585 | $55,721 | $71,956 | | General and administrative | $11,388 | $14,235 | $24,234 | $30,753 | | Loss from operations | $(24,527) | $(32,766) | $(48,070) | $(67,652) | | **Net loss** | **$(22,644)** | **$(31,157)** | **$(44,934)** | **$(64,564)** | | Net loss per share, basic and diluted | $(1.06) | $(1.47) | $(2.11) | $(3.06) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities significantly improved to $30.3 million for the six months ended March 31, 2025, with overall cash increasing by $22.4 million due to investing activities Summary of Cash Flows (in thousands) | Activity | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(30,289) | $(53,589) | | Net cash provided by investing activities | $64,534 | $45,507 | | Net cash used in financing activities | $(11,873) | $(13,764) | | **Net increase (decrease) in cash** | **$22,372** | **$(21,846)** | [Notes to Condensed Consolidated Financial Statements (unaudited)](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) The notes detail the company's biotechnology focus, primary revenue from AbbVie, sufficient cash for 12 months, ongoing patent litigation against Pfizer, and accounting for a $200 million royalty sale agreement - The company believes its cash, cash equivalents, and short-term marketable securities of **$193.4 million** as of March 31, 2025, are sufficient to fund operations for at least **12 months** from the financial statement issuance date[28](index=28&type=chunk) - In April 2023, the company sold **54.5%** of future royalty payments on MAVYRET/MAVIRET to an affiliate of OMERS for a **$200 million** upfront payment. The proceeds are recorded as a liability and amortized over the life of the agreement[39](index=39&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - Enanta is appealing a December 2024 District Court summary judgment decision that ruled its '953 Patent, related to its infringement suit against Pfizer's Paxlovid, was invalid. The appeal was filed in February 2025[60](index=60&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's virology and immunology pipeline, noting decreased revenue from AbbVie but significantly lower operating expenses, and projects funding into fiscal 2028 with current cash and an anticipated tax refund [Overview and Pipeline](index=18&type=section&id=Overview%20and%20Pipeline) Enanta is a biotechnology company focused on small molecule drugs for virology and immunology, with primary revenue from AbbVie royalties and a pipeline including RSV, COVID-19, and immunology programs - The company's active development programs in virology are focused on respiratory syncytial virus (RSV), with two clinical-stage candidates: zelicapavir and EDP-323[67](index=67&type=chunk)[73](index=73&type=chunk) - In immunology, the company is developing oral small molecule inhibitors, with initial targets being KIT for chronic spontaneous urticaria (CSU) and STAT6 for atopic dermatitis (AD)[68](index=68&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) Product Development Pipeline Summary | Program | Disease | Target | Stage | | :--- | :--- | :--- | :--- | | **Virology** | | | | | Zelicapavir | RSV | N-Protein | Phase 2 (Pediatrics & High-Risk Adults) | | EDP-323 | RSV | L-Protein | Phase 2 (challenge study completed) | | EDP-235 | COVID-19 | 3CL Protease | Phase 2 (seeking collaboration) | | **Immunology** | | | | | EPS-1421 | CSU | KIT | Preclinical (IND-enabling studies) | | STAT6 Inhibitor | Atopic Dermatitis | STAT6 | Discovery (lead optimization) | [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Net losses narrowed for both the three- and six-month periods ended March 31, 2025, driven by significant reductions in R&D and general and administrative expenses, despite lower royalty revenue [Comparison of the Three Months Ended March 31, 2025 and 2024](index=27&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20March%2031%2C%202025%20and%202024) Revenue decreased to $14.9 million for the three months ended March 31, 2025, but a significant reduction in R&D and general and administrative expenses led to a net loss improvement to $22.6 million - Revenue decreased by **$2.1 million** year-over-year to **$14.9 million** due to lower reported HCV sales by AbbVie[99](index=99&type=chunk) R&D Expense Breakdown - Three Months Ended March 31 (in thousands) | Program | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Total Virology | $18,106 | $26,545 | $(8,439) | | Total Immunology | $7,293 | $4,673 | $2,620 | | **Total R&D** | **$28,065** | **$35,585** | **$(7,520)** | - General and administrative expenses decreased by **$2.8 million** year-over-year, primarily due to a decrease in legal expenses related to the patent infringement suit against Pfizer[107](index=107&type=chunk) [Comparison of the Six Months Ended March 31, 2025 and 2024](index=28&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20March%2031%2C%202025%20and%202024) Revenue decreased to $31.9 million for the six months ended March 31, 2025, but a substantial reduction in R&D and general and administrative expenses resulted in a net loss of $44.9 million - Revenue decreased by **$3.2 million** year-over-year to **$31.9 million** due to lower reported HCV sales by AbbVie[112](index=112&type=chunk) R&D Expense Breakdown - Six Months Ended March 31 (in thousands) | Program | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Total Virology | $36,699 | $54,156 | $(17,457) | | Total Immunology | $13,838 | $8,695 | $5,143 | | **Total R&D** | **$55,721** | **$71,956** | **$(16,235)** | - General and administrative expenses decreased by **$6.5 million** year-over-year, primarily due to lower legal expenses related to the Pfizer patent suit[118](index=118&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company had **$193.4 million** in cash and marketable securities, expecting these resources plus a **$33.8 million** tax refund to fund operations into fiscal 2028 - The company expects its existing cash, marketable securities, retained royalties, and a **$33.8 million** tax refund (received in April 2025) will fund operations into fiscal 2028[126](index=126&type=chunk)[86](index=86&type=chunk) Cash Flow Summary - Six Months Ended March 31 (in thousands) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Cash used in Operating activities | $(30,289) | $(53,589) | | Cash provided by Investing activities | $64,534 | $45,507 | | Cash used in Financing activities | $(11,873) | $(13,764) | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=28&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes occurred in the company's market risk disclosures during the six months ended March 31, 2025, compared to the prior fiscal year's annual report - There were no material changes to the company's market risk disclosures during the six months ended March 31, 2025[140](index=140&type=chunk) [Item 4. Controls and Procedures](index=28&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[141](index=141&type=chunk) - No changes occurred during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[142](index=142&type=chunk) PART II. Other Information [Item 1. Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) The company is appealing a December 2024 District Court ruling that invalidated its patent claims in an infringement lawsuit against Pfizer regarding Paxlovid, filed in June 2022 - Enanta filed a lawsuit against Pfizer in June 2022 for infringement of its U.S. Patent No. 11,358,953 related to Pfizer's COVID-19 antiviral, Paxlovid[60](index=60&type=chunk) - On December 23, 2024, the District Court ruled that the asserted patent claims were invalid. Enanta filed an appeal with the Federal Circuit on February 3, 2025, and the outcome is pending[60](index=60&type=chunk) [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) No material changes occurred to the company's risk factors previously disclosed in its Annual Report on Form 10-K for the fiscal year ended September 30, 2024 - No material changes to the company's risk factors occurred during the quarter ended March 31, 2025[145](index=145&type=chunk) [Item 5. Other Information](index=28&type=section&id=Item%205.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended March 31, 2025 - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended March 31, 2025[146](index=146&type=chunk) [Item 6. Exhibits](index=29&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including corporate documents and certifications by the CEO and CFO - The report includes exhibits such as CEO and CFO certifications (31.1, 31.2, 32.1) and XBRL data files (101, 104)[147](index=147&type=chunk)

Group 1 - Enanta Pharmaceuticals reported a quarterly loss of $1.06 per share, slightly worse than the Zacks Consensus Estimate of a loss of $1.04, but an improvement from a loss of $1.47 per share a year ago, indicating an earnings surprise of -1.92% [1] - The company posted revenues of $14.93 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 8.71%, and down from $17.05 million in the same quarter last year [2] - Enanta Pharmaceuticals shares have declined approximately 8.4% since the beginning of the year, compared to a decline of 3.8% for the S&P 500 [3] Group 2 - The earnings outlook for Enanta Pharmaceuticals is mixed, with the current consensus EPS estimate for the upcoming quarter at -$1.15 on revenues of $16.34 million, and for the current fiscal year at -$3.90 on revenues of $64.44 million [7] - The Zacks Industry Rank for Medical - Drugs is currently in the top 27% of over 250 Zacks industries, suggesting that the industry outlook can significantly impact stock performance [8] - Plus Therapeutics, another company in the same industry, is expected to report a quarterly loss of $0.17 per share, reflecting a year-over-year change of +77.3%, with revenues projected to be $1.85 million, up 10.1% from the previous year [9]

[Executive Summary & Program Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Program%20Highlights) Enanta Pharmaceuticals reported progress across its virology and immunology pipelines for the fiscal second quarter of 2025, meeting target enrollment for the Phase 2 RSVHR study of zelicapavir and maintaining a strong cash position bolstered by a significant federal income tax refund - Met target enrollment of **180 patients** in RSVHR, a Phase 2 study of zelicapavir for high-risk adults with RSV, with topline data expected in late Q3 2025[2](index=2&type=chunk)[5](index=5&type=chunk) - Plans to select a lead development candidate for the oral STAT6 inhibitor program in the second half of 2025, targeting atopic dermatitis initially[3](index=3&type=chunk)[5](index=5&type=chunk) - IND-enabling studies are ongoing for EPS-1421, the lead candidate in the KIT inhibitor program for chronic spontaneous urticaria[3](index=3&type=chunk)[5](index=5&type=chunk) - Cash and marketable securities totaled **$193.4 million** at quarter-end, strengthened by a **$33.8 million** federal tax refund received in April 2025[5](index=5&type=chunk)[12](index=12&type=chunk) [Fiscal Second Quarter 2025 Financial Results](index=1&type=section&id=Fiscal%20Second%20Quarter%202025%20Financial%20Results) Enanta reported total revenue of **$14.9 million** and a net loss of **$22.6 million** for Q2 FY2025, an improvement from the prior year due to reduced operating expenses, maintaining a strong cash position expected to fund operations into fiscal 2028 Q2 FY2025 vs Q2 FY2024 Financial Summary | Financial Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $14.9 million | $17.1 million | -12.9% | | R&D Expenses | $28.1 million | $35.6 million | -21.1% | | G&A Expenses | $11.4 million | $14.2 million | -19.7% | | Net Loss | ($22.6 million) | ($31.2 million) | +27.6% (Loss narrowed) | | Net Loss per Share | ($1.06) | ($1.47) | +27.9% (Loss narrowed) | - Revenue consists of royalties from AbbVie's HCV regimen MAVYRET®/MAVIRET®, with **54.5%** of this royalty servicing debt from a **$200.0 million** royalty sale transaction with OMERS[4](index=4&type=chunk)[6](index=6&type=chunk) - The decrease in R&D expenses was primarily due to the timing of clinical trials in the RSV program[7](index=7&type=chunk) - The decrease in G&A expenses was mainly due to lower legal costs related to the patent infringement lawsuit against Pfizer[8](index=8&type=chunk) - Cash, cash equivalents, and marketable securities totaled **$193.4 million**, with a subsequent **$33.8 million** tax refund, the company expects to fund operations into fiscal 2028[12](index=12&type=chunk) [Pipeline and Program Updates](index=2&type=section&id=Pipeline%20and%20Program%20Updates) Enanta is advancing a dual-focused pipeline in virology and immunology, with two Phase 2 RSV candidates exploring partnership opportunities and immunology programs progressing towards lead candidate selection and IND-enabling studies [Virology](index=2&type=section&id=Virology) Enanta's virology efforts focus on its leading RSV portfolio, featuring two oral antiviral candidates, zelicapavir and EDP-323, both with Fast Track designation, for which the company is evaluating potential partnerships - **Zelicapavir (N-protein inhibitor):** Met target enrollment of **180 high-risk adult patients** in the Phase 2b RSVHR study, with topline data expected late in Q3 2025[16](index=16&type=chunk) - **EDP-323 (L-protein inhibitor):** Demonstrated highly statistically significant reductions in viral load and clinical symptoms in a human challenge study, usable as monotherapy or in combination[16](index=16&type=chunk) - Both zelicapavir and EDP-323 have received Fast Track designation from the U.S. FDA[16](index=16&type=chunk) - The company will evaluate potential partnership opportunities to further develop its RSV assets[14](index=14&type=chunk) [Immunology](index=3&type=section&id=Immunology) The immunology pipeline focuses on oral inhibitors for inflammatory diseases, with the lead KIT inhibitor EPS-1421 in IND-enabling studies and a STAT6 inhibitor program poised to select a development candidate in late 2025, alongside plans for a third program - **KIT Inhibitors:** The lead candidate, EPS-1421, is a potent and selective oral inhibitor of KIT, currently undergoing scale-up activities and IND-enabling studies[16](index=16&type=chunk) - **STAT6 Inhibitors:** The program targets the transcription factor for IL-4/IL-13 signaling, with prototypes showing nanomolar inhibition, high selectivity, and in vivo target engagement, and a development candidate selection planned for 2H 2025[16](index=16&type=chunk)[20](index=20&type=chunk) - Enanta plans to expand its immunology pipeline by introducing a third program in 2025[20](index=20&type=chunk) [Corporate Updates](index=4&type=section&id=Corporate%20Updates) Enanta received a **$33.8 million** federal income tax refund in April 2025 and is proceeding with its patent infringement lawsuit against Pfizer regarding Paxlovid™, having filed an opening brief in March 2025 - Received a **$33.8 million** federal income tax refund in April 2025[20](index=20&type=chunk) - Filed an opening brief with the U.S. Court of Appeals on March 21, 2025, in its patent infringement lawsuit against Pfizer concerning the COVID-19 antiviral, Paxlovid™[20](index=20&type=chunk) - The company plans to issue its fiscal third quarter 2025 financial results on August 11, 2025[20](index=20&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) The unaudited condensed consolidated financial statements provide a comprehensive view of Enanta's financial position as of March 31, 2025, and its operational results for the three and six months then ended, detailing revenues, expenses, assets, liabilities, and stockholders' equity [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended March 31, 2025, Enanta reported revenues of **$14.9 million** and a net loss of **$22.6 million**, with both periods showing narrower losses compared to the prior year due to reduced operating expenses Condensed Consolidated Statements of Operations (Unaudited, in thousands) | | Three Months Ended March 31, | Six Months Ended March 31, | | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | **Revenue** | **$14,926** | **$17,054** | **$31,885** | **$35,057** | | Total operating expenses | $39,453 | $49,820 | $79,955 | $102,709 | | Loss from operations | ($24,527) | ($32,766) | ($48,070) | ($67,652) | | **Net loss** | **($22,644)** | **($31,157)** | **($44,934)** | **($64,564)** | | **Net loss per share, diluted** | **($1.06)** | **($1.47)** | **($2.11)** | **($3.06)** | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, Enanta reported total assets of **$323.0 million**, including **$193.4 million** in cash and marketable securities, with total liabilities of **$229.5 million** and total stockholders' equity of **$93.5 million** Condensed Consolidated Balance Sheet Highlights (Unaudited, in thousands) | | **March 31, 2025** | **September 30, 2024** | | :--- | :--- | :--- | | **Assets** | | | | Cash and marketable securities | $193,375 | $248,186 | | Total current assets | $242,860 | $299,852 | | **Total assets** | **$322,993** | **$376,652** | | **Liabilities and Equity** | | | | Liability related to sale of future royalties (Total) | $156,060 | $169,241 | | Total liabilities | $229,455 | $247,838 | | **Total stockholders' equity** | **$93,538** | **$128,814** |

Core Viewpoint - Enanta Pharmaceuticals (ENTA) has received an upgrade to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with near-term stock price movements [4][6]. - Institutional investors often rely on earnings estimates to determine the fair value of a company's shares, leading to buying or selling actions that affect stock prices [4]. Recent Performance of Enanta Pharmaceuticals - Enanta Pharmaceuticals is projected to earn -$4.65 per share for the fiscal year ending September 2025, reflecting a year-over-year change of 15.2% [8]. - Over the past three months, the Zacks Consensus Estimate for Enanta has increased by 7.3%, indicating a positive trend in earnings estimates [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have generated an average annual return of +25% since 1988 [7]. - The upgrade of Enanta Pharmaceuticals to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Financial Position - As of December 31, 2024, the company had $216.7 million in cash, cash equivalents, and short-term marketable securities, expected to fund operations into fiscal 2028[72]. - The company received a $200 million cash payment in April 2023 from a royalty sale agreement, which will impact future royalty payments[81][100]. - The company has funded operations primarily through royalty payments from AbbVie and the $200 million received from the royalty sale agreement, enabling funding into fiscal 2028[85]. - Cash used in operating activities was $16.8 million for the three months ended December 31, 2024, a decrease of $8.2 million compared to $25.0 million for the same period in 2023[110]. - Cash provided by investing activities was $68.9 million for the three months ended December 31, 2024, an increase of $82.0 million compared to cash used in investing activities of $13.1 million for the same period in 2023[112]. - Cash used in financing activities decreased by $2.4 million to $5.0 million for the three months ended December 31, 2024, compared to $7.4 million for the same period in 2023[113]. - Total estimated minimum lease payments for the next five years are projected to be $6.7 million for 2025, $8.5 million for 2026, $8.7 million for 2027, $9.0 million for 2028, and $9.3 million for 2029[120]. Research and Development - The company is developing two clinical stage product candidates for RSV: zelicapavir and EDP-323, both of which have received Fast Track designation from the FDA[74]. - Zelicapavir demonstrated a viral load decline of 1.0 log at Day 3 and 1.4 log at Day 5 in a Phase 2 study, with a favorable safety profile observed across all age groups[75]. - EDP-323 achieved statistically significant reductions in viral load and clinical symptoms in a Phase 2a challenge study, with a p-value of <0.0001 compared to placebo[76]. - EDP-235, an oral inhibitor targeting SARS-CoV-2, showed a dose-dependent improvement in total symptom score, achieving statistical significance (p<0.05) in the 400 mg treatment group[76]. - The company plans to select a lead development candidate for oral STAT6 inhibitors in the second half of 2025, focusing on type 2 immune-driven diseases[76]. - The company has ongoing development programs targeting chronic spontaneous urticaria (CSU) and atopic dermatitis (AD), with CSU affecting approximately 1.75-3.5 million people in the U.S.[70][71]. - The company expects to complete enrollment for a Phase 2b study of zelicapavir in high-risk adults by the end of the current Northern Hemisphere RSV season, with topline data expected in Q3 2025[75]. - The company is focusing on collaborations to progress EDP-235 into Phase 3 studies, as it will not advance this candidate independently[77]. - The company has identified novel oral KIT inhibitors for preclinical development, with a lead candidate selected in Q4 2024[77]. - The company plans to expand its presence in immunology with the introduction of a third program in 2025[78]. - The company is conducting a Phase 2b study of zelicapavir in high-risk adults and has completed a Phase 2b study in pediatric patients[83]. Expenses and Revenue - Royalty revenue for the three months ended December 31, 2024, was $16.96 million, a decrease of $1.04 million from $18.00 million in the same period of 2023[86][98]. - Research and development expenses for the three months ended December 31, 2024, decreased by $8.7 million to $27.66 million compared to $36.37 million in the same period of 2023[101]. - The company expects a reduction in external research and development expenses in the next 12 months, primarily due to the completion of key studies[84][91]. - The total revenue recognized for the three months ended December 31, 2024, was $16.96 million, attributed to AbbVie's lower reported HCV sales compared to the previous year[98]. - Research and development expenses in the virology program decreased by $9 million, mainly due to the timing of clinical trials[102]. - Immunology program costs increased by $2.5 million due to scale-up and IND-enabling activities related to the KIT program and initiation of preclinical studies for the STAT6 program[103]. - Other program costs decreased by $2.2 million due to the completion of discovery and optimization activities related to the STAT6 program[104]. - General and administrative expenses decreased by $3.7 million for the three months ended December 31, 2024, primarily due to a decrease in legal expenses related to a patent infringement suit against Pfizer[105]. - Interest expense decreased by $1.5 million for the three months ended December 31, 2024, due to the paydown of obligations associated with a royalty sale agreement[106].

Financial Performance - Enanta Pharmaceuticals reported a quarterly loss of $1.05 per share, which was better than the Zacks Consensus Estimate of a loss of $1.16, representing an earnings surprise of 9.48% [1] - The company posted revenues of $16.96 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 5.93%, although this is a decrease from $18 million in the same quarter last year [2] - Over the last four quarters, Enanta has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] Stock Performance - Enanta Pharmaceuticals shares have declined approximately 14.8% since the beginning of the year, contrasting with the S&P 500's gain of 2.5% [3] - The current Zacks Rank for Enanta is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Future Outlook - The consensus EPS estimate for the upcoming quarter is -$1.37 on revenues of $15.6 million, and for the current fiscal year, it is -$5.05 on revenues of $64.77 million [7] - The outlook for the Medical - Drugs industry, to which Enanta belongs, is currently in the top 34% of over 250 Zacks industries, suggesting a favorable environment for stock performance [8]

Financial Performance - Total revenue for the fiscal first quarter ended December 31, 2024, was $17.0 million, a decrease from $18.0 million in the same period of 2023, primarily due to a decline in AbbVie's sales of MAVYRET®/MAVIRET®[4] - Net loss for the three months ended December 31, 2024, was $22.3 million, or a loss of $1.05 per diluted common share, compared to a net loss of $33.4 million, or a loss of $1.58 per diluted common share, for the same period in 2023[10] Expenses - Research and development expenses decreased to $27.7 million for the three months ended December 31, 2024, from $36.4 million in the same period of 2023, attributed to timing of clinical trials in the RSV program[6] - General and administrative expenses were $12.8 million for the three months ended December 31, 2024, down from $16.5 million in the same period of 2023, due to reduced legal expenses related to a patent infringement lawsuit[7] - Interest expense for the three months ended December 31, 2024, was $2.0 million, down from $3.4 million in the same period of 2023[5] Cash and Assets - Cash, cash equivalents, and short-term marketable securities totaled $216.7 million at December 31, 2024, expected to support operations into fiscal year 2028[11] - Cash and cash equivalents increased significantly from $37,233 million in September 2024 to $84,349 million in December 2024, representing a growth of 126.5%[22] - Total current assets decreased from $299,852 million in September 2024 to $268,145 million in December 2024, a decline of approximately 10.6%[22] - Property and equipment, net increased from $32,688 million in September 2024 to $37,368 million in December 2024, a growth of about 14.0%[22] - Short-term marketable securities decreased from $210,953 million in September 2024 to $132,342 million in December 2024, a decline of approximately 37.3%[22] Liabilities - Total liabilities decreased from $247,838 million in September 2024 to $236,826 million in December 2024, a reduction of about 4.5%[22] - Accounts payable decreased from $8,002 million in September 2024 to $4,726 million in December 2024, a decrease of about 41.4%[22] - Accrued expenses and other current liabilities decreased from $13,547 million in September 2024 to $10,575 million in December 2024, a decline of approximately 22.8%[22] - Liability related to the sale of future royalties decreased from $34,462 million in September 2024 to $32,743 million in December 2024, a reduction of about 5.0%[22] - Operating lease liabilities increased slightly from $1,524 million in September 2024 to $1,006 million in December 2024, a decrease of approximately 34.0%[22] Future Developments - Enanta is on track to report topline results for RSVHR, a Phase 2 study of zelicapavir, in the third quarter of 2025[3] - The company plans to announce a lead development candidate for its STAT6 program in the second half of 2025[3] - Enanta aims to develop a first-in-disease and best-in-class RSV antiviral treatment portfolio, with both zelicapavir and EDP-323 in clinical development[13] Royalty Revenue - A portion (54.5%) of ongoing royalty revenue from AbbVie's net sales of MAVYRET®/MAVIRET® is paid to OMERS, with a liability of $200.0 million recorded for the royalty sale transaction[5]

Company Overview - Enanta Pharmaceuticals is a biotechnology company focused on developing small-molecule drugs for viral infections, with its lead candidate being zelicapavir, an oral N-protein inhibitor currently in midstage studies for treating respiratory syncytial virus infection in both pediatric and adult patients [1][5]. Stock Performance - Enanta Pharmaceuticals' shares experienced a rally of 7.2% in the last trading session, closing at $6.28, which is notable given the stock's 37.1% loss over the previous four weeks [4]. - The stock currently holds a Zacks Rank of 3 (Hold), indicating a neutral outlook [1][7]. Earnings Expectations - The company is expected to report a quarterly loss of $1.15 per share, reflecting a year-over-year change of +27.2%, while revenues are projected to be $17.51 million, down 2.7% from the same quarter last year [5]. - The consensus EPS estimate for the upcoming quarter has been revised 7.3% higher over the last 30 days, suggesting a positive trend that may lead to price appreciation [6]. Industry Context - Enanta Pharmaceuticals is part of the Zacks Medical - Drugs industry, which includes other companies such as Neurocrine Biosciences, whose stock has shown a return of 8% over the past month [3].