Executive Summary

Q2 2024 revenue was $17.1M, all from AbbVie MAVYRET/MAVIRET royalties; diluted EPS was a loss of $1.47. Net loss improved year over year to $(31.2)M from $(37.7)M in Q2 2023 .
Management raised full‑year expense guidance at the fiscal mid‑point: R&D to $125–$145M and G&A to $50–$60M, citing acceleration of RSV studies, new immunology programs, stock comp, and legal costs; prior guidance was R&D $100–$120M and G&A $45–$50M in Q1 2024 .
Balance sheet remains strong with $300.3M in cash and marketable securities; company expects liquidity plus retained royalties to fund operations through Q3 fiscal 2027 .
Near‑term catalysts: topline data from the Phase 2a RSV challenge study (EDP‑323) in Q3 2024 and Phase 2 pediatric RSV study (RSVPEDs; zelicapavir) in 2H 2024; RSVHR adult high‑risk enrollment progressing with guidance forthcoming as Southern Hemisphere season advances .
Strategic expansion into immunology continues; target selection for an oral KIT inhibitor development candidate for CSU is on track for Q4 2024; management aims to announce a second immunology program in 2024 .

What Went Well and What Went Wrong

What Went Well

RSV pipeline momentum: multiple readouts expected this year; management reiterates commitment to “advancing the first antiviral treatment for RSV” and to delivering first‑in‑class replication inhibitors (N‑ and L‑protein) .
Year‑over‑year operating improvement: R&D fell to $35.6M from $43.5M, with net loss narrowing to $(31.2)M from $(37.7)M; CFO highlighted lower COVID‑19 program costs offset by RSV and immunology investments .
Strong liquidity and runway: $300.3M in cash and marketable securities; expected runway through Q3 fiscal 2027 supported by retained royalty cash flows .

Management quotes:

“We are committed to advancing the first antiviral treatment for RSV…pending positive data…we will be poised to deliver potential first‑in‑class antiviral replication inhibitors” — Jay R. Luly, Ph.D., CEO .
“We expect…current cash…as well as our retained portion of ongoing royalties…to be sufficient…through the third quarter of fiscal 2027” — Paul Mellett, CFO .

What Went Wrong

Modest top‑line declines: Q2 revenue declined to $17.1M from $17.8M YoY, reflecting lower MAVYRET/MAVIRET royalties at the 10% tier .
Higher non‑operating drag: $2.6M interest expense from royalty monetization; ongoing 54.5% pass‑through of cash royalties to OMERS until the cap is reached .
Elevated legal and G&A: G&A increased to $14.2M YoY, primarily from patent litigation costs; full‑year G&A guidance raised to $50–$60M .

Financial Results

Quarterly comparison (oldest → newest)

Metric	Q4 2023	Q1 2024	Q2 2024
Revenue ($USD Millions)	$18.9	$18.0	$17.1
Net Loss ($USD Millions)	$(28.1)	$(33.4)	$(31.2)
Diluted EPS ($USD)	$(1.33)	$(1.58)	$(1.47)
R&D Expense ($USD Millions)	$36.2	$36.4	$35.6
G&A Expense ($USD Millions)	$13.8	$16.5	$14.2
Interest Expense ($USD Millions)	$3.2	$3.4	$2.6
Cash & Marketable Securities ($USD Millions)	$370.0	$337.2	$300.3

Q2 year-over-year comparison

Metric	Q2 2023	Q2 2024
Revenue ($USD Millions)	$17.8	$17.1
Net Loss ($USD Millions)	$(37.7)	$(31.2)
Diluted EPS ($USD)	$(1.79)	$(1.47)
R&D Expense ($USD Millions)	$43.5	$35.6
G&A Expense ($USD Millions)	$13.8	$14.2
Interest Expense ($USD Millions)	$0.0	$2.6

Revenue composition / KPIs

KPI	Q2 2024 Detail
Revenue mix	100% royalties from AbbVie MAVYRET/MAVIRET
Royalty pass-through	54.5% of cash royalties paid to OMERS until 1.42x cap; accounted as debt
Cash runway	Liquidity expected to fund operations through Q3 fiscal 2027

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
R&D Expense ($USD Millions)	FY 2024	$100–$120M	$125–$145M	Raised
G&A Expense ($USD Millions)	FY 2024	$45–$50M	$50–$60M	Raised

Rationale: R&D increase driven by immunology program initiation and efforts to accelerate RSV clinical studies; G&A increase reflects additional stock compensation and litigation expenses related to Pfizer patent case .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2023, Q1 2024)	Current Period (Q2 2024)	Trend
RSV strategy (N- and L‑protein antivirals)	Initiated EDP‑323 Phase 2a challenge; targeted Q3 2024 readouts; RSVPEDs/RSVHR progressing	Multiple 2024 readouts reiterated; PEDs nearing completion; HR enrollment progressing; challenge study in Q3	Execution milestones approaching; stronger visibility
RSVPEDs endpoints & expectations	Designed to show virology trends sufficient to advance to registrational trials	Primary focus on virology improvements; acknowledges limited benchmark data; directional data acceptable	Consistent approach; emphasis on virology readouts
RSVHR powering & endpoints	Phase 2 PoC with RIIQ; look for clinically meaningful time‑to‑resolution improvements	Powered for 50% reduction; viewed as high bar; 1+ day symptom reduction judged meaningful	Clarity on powering; pragmatic expectations
EDP‑323 dosing & expectations	QD dosing supported by Phase 1; challenge data in Q3 2024	Testing 600mg QD and 600mg load→200mg; aiming for comparable efficacy to zelicapavir	Dose exploration; best‑in‑class aspiration maintained
Immunology expansion (CSU KIT inhibitor)	Announced program; development candidate planned for 2024; seek best‑in‑disease oral option	On track to select candidate in Q4 2024; second immunology program planned; biomarker (serum tryptase) to de‑risk	Program maturation; added clinical planning detail
Legal / litigation	Elevated legal expenses (Pfizer litigation) noted	G&A increase driven partly by litigation costs; trial around year‑end if it proceeds	Ongoing headwind in G&A

Management Commentary

“Pending positive data from these studies, we will be poised to deliver potential first‑in‑class antiviral replication inhibitors with differentiated mechanisms of action and advance our robust RSV portfolio.” — Jay R. Luly, Ph.D., CEO .
“We now expect our research and development expense to be between $125 million and $145 million, and our general and administrative expense to be between $50 million and $60 million.” — Paul Mellett, CFO .
“We anticipate reporting data from the Phase IIa challenge study of EDP‑323 in the third quarter and reporting data from the Phase II pediatric study of zelicapavir in the second half of this year.” — Jay R. Luly, Ph.D., CEO .

Q&A Highlights

RSVPEDs readout will emphasize virology improvements over symptoms due to size/power; directional trends would be sufficient to advance to Phase 3. Benchmark pediatric data are scarce; one cited study showed ~0.6 log drop at day 4 with symptom gains, reinforcing focus on totality of virology data .
RSVHR is powered for a 50% reduction in time‑to‑resolution (acknowledged as a high bar); management views 1+ day improvement as clinically meaningful in high‑risk adults (contextualized vs influenza outcomes) .
EDP‑323 Phase 2a challenge designs: 600mg QD or 600mg loading then 200mg; targeting efficacy in the range of best‑in‑class zelicapavir; challenge study enables rapid dose/regimen insights .
Portfolio positioning: no intent to run RSV in otherwise healthy adults given rapid self‑resolution; focus remains on high‑risk and pediatric populations; combination therapy may expand treatment window/populations longer‑term .
Immunology (CSU KIT inhibitor): QD oral dosing goal with potent, selective profile; serum tryptase biomarker in Phase 1 to confirm target engagement; exploring broader mast‑cell driven indications over time .

Estimates Context

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Key Takeaways for Investors

Liquidity is ample ($300.3M) with expected runway through Q3 fiscal 2027; supports RSV and immunology execution without near‑term financing risk .
Near‑term stock catalysts are concentrated: EDP‑323 challenge data in Q3 2024 and RSVPEDs pediatric data in 2H 2024; positive readouts would strengthen the first‑in‑class RSV antiviral narrative and value inflection potential .
Raised OpEx guidance underscores accelerated development pace and immunology build‑out; monitor burn trajectory vs milestones to assess capital efficiency .
Royalty monetization structure (54.5% pass‑through to OMERS) creates recurring interest expense and reduces cash royalties until cap is hit; investors should adjust FCF expectations accordingly .
RSVHR adult high‑risk study is powered ambitiously; management sets realistic bar (≥1 day improvement) — directional efficacy could be enough to move to Phase 3, but statistical bar is high .
CSU program targets best‑in‑disease efficacy with oral KIT inhibition and biomarker‑driven de‑risking; candidate selection in Q4 2024 could add a non‑virology growth leg .
Litigation remains a G&A headwind; management indicates potential trial timing near year‑end if proceedings continue — monitor for developments .

ENANTA PHARMACEUTICALS INC (ENTA)·Q2 2024 Earnings Summary