CONCORD, Calif. - Cerus (NASDAQ:CERS) Corporation (NASDAQ:CERS) has announced a substantial new contract with the Biomedical Advanced Research and Development Authority (BARDA) valued at up to $248 million to support its INTERCEPT red blood cell (RBC) system in the United States. This funding aims to back the program from U.S. Phase 3 studies through to anticipated premarket approval (PMA) licensure and eventual commercialization.
The new contract with BARDA, a component of the U.S. Department of Health and Human Services, will provide $32.1 million for the initial phase, with the possibility of additional funds contingent on achieving specific milestones. The agreement is set to cover the next six years, facilitating the advancement of the INTERCEPT RBC system. This includes accelerating the development of an improved version of the system and scaling up manufacturing activities for a broader product launch if approval is granted.
Cerus reported positive topline results from the ReCePI study in March 2024, a pivotal U.S. Phase 3 clinical trial funded by BARDA. The study demonstrated non-inferiority when INTERCEPT-treated RBCs were transfused into patients undergoing complex cardiac surgery compared to conventional RBCs. The ongoing RedeS clinical trial, also funded by BARDA, is enrolling patients requiring RBC transfusion for acute and chronic anemia. The company anticipates that results from these trials will contribute to a planned modular PMA submission to the Food and Drug Administration (FDA).
In Europe, the company's application for CE Mark under the Medical Device Regulation (MDR) concluded without approval. The Competent Authority, CBG-MEB, found the data insufficient for the proposed classification of the impurity profile of the final product. Cerus, in collaboration with TÜV-SÜD, is strategizing for a potential new regulatory submission in Europe.
Cerus will host a webcast today at 5:00 p.m. EDT to provide updates on the INTERCEPT RBC program. A replay of the webcast will be available until October 30, 2024, on the company's website.
This news is based on a press release statement from Cerus Corporation.
In other recent news, Cerus Corporation has reported an upward revision in its annual product revenue guidance for 2024, reflecting a robust performance. The revised guidance now stands between $175 million to $178 million, up from the previous range of $172 million to $175 million. This adjustment is largely credited to a 16% year-over-year growth in product revenue, which amounted to $45.1 million. The surge is primarily due to the increasing use of Cerus' INTERCEPT blood system.
BTIG analysts reiterated a Neutral rating for Cerus, following the company's stronger-than-expected performance in the second quarter. The firm's analysis pointed out key factors contributing to Cerus' positive outlook, including a raised product revenue guidance for 2024 and robust growth in the U.S. and Canada, particularly from INTERCEPT platelets. Cerus is on track to reach adjusted EBITDA breakeven for the full year of 2024, a goal further supported by the generation of positive operating cash flow in the second quarter.
These recent developments indicate a potential turning point for Cerus, whose business may have experienced its lowest point in the third quarter of 2023. Analysts from BTIG suggest that the current trading price of Cerus shares at 2.1 times the Street's 2025 revenue estimate aligns with other small-cap companies tracked by the firm.
InvestingPro Insights
As Cerus Corporation (NASDAQ:CERS) secures a significant contract with BARDA, investors may find additional context from InvestingPro's data and tips valuable. The company's market capitalization stands at $333.53 million, reflecting its current market position as it pursues this major development opportunity.
An InvestingPro Tip indicates that Cerus operates with a moderate level of debt, which could be advantageous as the company embarks on this extensive development program. This financial stability may provide Cerus with the flexibility needed to navigate the lengthy process of clinical trials and regulatory approvals.
Another relevant InvestingPro Tip notes that Cerus's liquid assets exceed its short-term obligations. This strong liquidity position aligns well with the company's need for sustained funding throughout the INTERCEPT RBC system's development and potential commercialization phases.
The company's revenue growth is noteworthy, with a 10.79% increase over the last twelve months and a more impressive 16.02% growth in the most recent quarter. This growth trajectory could be further bolstered by the potential success of the INTERCEPT RBC system.
For investors seeking a more comprehensive analysis, InvestingPro offers 6 additional tips for Cerus Corporation, providing a deeper understanding of the company's financial health and market position.
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