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AIM ImmunoTech Inc. (AIM)·Q3 2016 Earnings Summary

Executive Summary

  • ANMAT approved Ampligen for severe ME/CFS in Argentina—Ampligen’s first commercial approval and the first drug approved for CFS globally; early access sales in Europe/Turkey targeted following Dec-2016 lot release, creating new near-term catalysts .
  • Q3 2016 showed disciplined expense control: total operating expenses fell 19% YoY to $3.248M and quarterly cash used was $3.061M, down 13% YoY, while net loss improved to $2.862M from $3.803M YoY .
  • Operations reset continued: reverse split restored NYSE compliance; $5.0M gross capital raise funds manufacturing tech transfer and working capital, and litigation settlements were completed, freeing resources .
  • Revenue remains de minimis ($0.022M), with no Alferon product sales; the investment case hinges on regulatory/mfg execution and early-access monetization rather than quarterly financials .
  • Consensus estimates were unavailable via S&P Global for Q3 2016; comparisons to Street were not possible (limited microcap coverage) (S&P Global data unavailable).

What Went Well and What Went Wrong

What Went Well

  • Argentina approval and path to launch: “Ampligen was approved by ANMAT… the first drug to receive approval for CFS anywhere in the world,” with post-approval steps and pricing discussions underway; timeline 12–18 months to commercial launch with GP Pharm .
  • Manufacturing progress for EAP: technology transfer to Avecia completed; first cGMP lot expected filled/finished Nov and released in Dec 2016 for EAP in Europe/Turkey—supports near-term product availability .
  • Cost discipline and liquidity actions: Q3 operating expenses cut to $3.248M (-19% YoY); cash used in Q3 was $3.061M (-13% YoY); $5.0M gross financing targeted tech transfer/Ampligen lots and working capital .

What Went Wrong

  • Revenue remained negligible and product sales absent: Q3 revenue was $0.022M (clinical programs only); no Alferon sales due to halted production pending revalidation and FDA pre-approval steps .
  • Alferon facility challenges: flood-related repairs completed, but manufacturing is still on hold; revalidation requires additional funds and timing remains uncertain, risking longer path to Alferon revenue .
  • Street estimate context unavailable: lack of consensus EPS/revenue estimates limited external validation and beat/miss framing (S&P Global data unavailable).

Financial Results

MetricQ3 2015Q2 2016Q3 2016
Revenues ($USD Millions)$0.023 $0.015 $0.022
Operating Loss ($USD Millions)$(3.983) $(2.814) $(3.226)
Net Loss ($USD Millions)$(3.803) $(1.303) $(2.862)
Diluted EPS ($USD)$(0.18) $(0.01) $(0.13)
Production Costs ($USD Millions)$0.353 $0.290 $0.272
Research & Development ($USD Millions)$1.968 $0.900 $1.342
General & Administrative ($USD Millions)$1.685 $1.639 $1.634

Revenue composition (no segment sales):

  • Clinical treatment programs revenue: $0.022M in Q3 2016 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Ampligen cGMP lot release (Avecia)Q4 2016NoneFirst cGMP lot compounded/filled/finished in Nov; release in Dec for EAP Europe/Turkey Introduced timeline
Argentina ME/CFS commercial launch (Ampligen)12–18 months post-approvalNonePost-approval steps incl. mfg inspection & pricing; launch in ~12–18 months Introduced timeline
Europe/Turkey EAP monetizationLate 2016/early 2017Early access framework activeSales expected as new lots released for EAP; first shipment to myTomorrows completed Operationalized EAP
AMP 511 price per 400mg doseEffective Oct 2016$150 per dose (historical)$400 per dose approved by FDA (cost recovery) Raised

Earnings Call Themes & Trends

TopicQ1 2016 (prior two quarters)Q2 2016 (prior quarter)Q3 2016 (current)Trend
Regulatory (Ampligen)Emphasis on FDA CRL and planning end-of-review path; open-label AMP 511 continued Strategy to regain listing, conserve cash, and advance EAP; continued CRL context ANMAT approval in Argentina; first global CFS approval; setting pricing & inspection steps Improving regulatory momentum
Manufacturing (Ampligen)Flood impacts on Alferon facility; mfg on hold; seeking additional funding; planning tech transfer Avecia (Avrio) engaged for Ampligen; first shipment to myTomorrows; repair progress Tech transfer completed to Avecia; first cGMP lot expected Nov/Dec release Execution advancing
Alferon facility statusFlood damage described; repairs and revalidation needs; no timetable Repairs near completion; HVAC and pump qualifications outlined Repairs completed; manufacturing still on hold; funding needed for revalidation Operationally constrained
Capital markets & listingPlan reverse split to maintain NYSE MKT listing Reverse split approved (1-for-12) and implemented; compliance targeted NYSE compliance regained post-split; monitoring continues Listing risk reduced
Litigation/legalMultiple actions active; strategy to settle or defend; CFO litigation resolved Insurance proceeds booked; derivative/class actions moving to settlement Settlements finalized; insurance funded, freeing management focus Legal overhang easing
Commercial pathways (EAP/LatAm)Negotiating reinstatement of EAP in EU/Turkey; GP Pharm agreements in LatAm EAP reinstated with myTomorrows; first shipment in July EAP supply starting Dec; Argentina launch prep with GP Pharm Monetization set-up

Management Commentary

  • “Ampligen was approved by ANMAT… the first drug to receive approval for CFS anywhere in the world.”
  • “Total operating expenses for the third quarter in 2016 were $3.248 million… cash used for the third quarter was $3.061 million… no Company funds were used to pay for costs related to the litigation settlements.”
  • “We anticipate the first lots of Ampligen to be filled and finished this month, with release in late December or early January for the Early Access Program in Europe…”
  • “We anticipate [Argentina commercialization] could take as long as 12 months to 18 months to complete.”

Q&A Highlights

  • Clinical strategy: FDA indicated proposed high-responder subgroup for Phase 3 design is acceptable—supports robust efficacy focus; SPA discussions ongoing .
  • Asset monetization: LOI signed to sell underutilized warehouse; proceeds to support operations (details pending definitive agreement) .
  • Partnerships: Active outreach with Huron and internal resources; prioritizing value-accretive deals—timeline uncertain .
  • Monetization timing: Europe EAP revenue expected as new lots are produced; Argentina sales require inspections, testing, pricing discussions (12–18 months) .
  • Capital use and corporate actions: $5M financing directed to mfg acceleration and R&D; no plans for another reverse split in foreseeable future .

Estimates Context

  • S&P Global consensus EPS and revenue estimates were unavailable for Q3 2016; therefore, beat/miss analysis versus Street could not be performed (S&P Global data unavailable).

Key Takeaways for Investors

  • Near-term catalyst: Dec-2016 release of Ampligen cGMP lot for EAP in Europe/Turkey could initiate first tangible revenues outside AMP 511; monitor supply ramp and reimbursement approvals .
  • Medium-term catalyst: Argentina commercialization (12–18 months) offers a defined regulatory launch path; pricing/reimbursement outcomes with GP Pharm will be pivotal .
  • Execution focus: Expense discipline and legal clean-up improved operating leverage, but investment case remains binary on manufacturing validation and regulatory milestones for Ampligen/Alferon .
  • Balance sheet runway: $8.009M in cash, equivalents, and marketable securities at 9/30 supports the tech transfer and EAP kick-off; additional funding likely needed for Alferon revalidation .
  • Pricing uplift: FDA-approved increase to $400 per 400mg Ampligen dose under cost recovery enhances unit economics for AMP 511 and potentially supports EAP pricing .
  • Trading implications: Stock could react to formal confirmation of Dec lot release, early-access country reimbursements, and any partnership announcements; lack of quarterly revenue means catalysts—not financials—drive sentiment .
  • Risk management: Continued uncertainty around Alferon pre-approval inspection and funding; investors should size positions accordingly given regulatory/manufacturing dependencies .

Supporting documents:

  • Q3 2016 call transcript
  • 8-K with Q3 PR and conference call info
  • Q3 2016 Form 10-Q (financials, mfg, legal, liquidity)
  • Q2 2016 Form 10-Q and call transcript
  • Q1 2016 Form 10-Q and call transcript