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PIERIS PHARMACEUTICALS, INC. (PIRS)·Q1 2023 Earnings Summary

Executive Summary

  • Q1 2023 was operationally on plan but financially soft: revenue fell sharply year over year due to prior-year milestone timing, and net loss widened as collaboration revenue normalized; management reiterated mid‑2024 topline for elarekibep (AZD1402) and advanced PRS‑220 and PRS‑400 toward 2H’23 milestones .
  • No formal financial guidance; program timing was maintained vs Q4: elarekibep Phase 2a topline mid‑2024, PRS‑220 Phase 1 top line 2H’23, PRS‑400 DCN 2H’23 .
  • Liquidity remained adequate for >12 months per management, with cash, cash equivalents and investments of $48.4M at 3/31/23 and reduced operating cash burn vs Q1’22 .
  • Estimates context: S&P Global consensus was unavailable; per Zacks, EPS was −$0.18 vs −$0.14 consensus (miss); we could not verify S&P revenue consensus and thus do not present it .
  • Potential stock catalysts cited: elarekibep Phase 2a progress, PRS‑220 Phase 1 readout, PRS‑400 preclinical updates, and partnering outcomes for PRS‑343 after striking AACR signals (100% unconfirmed ORR in 5 gastric cancer patients) .

What Went Well and What Went Wrong

What Went Well

  • Enrollment initiatives for elarekibep appeared to improve screening throughput after protocol amendments and site expansion; management reiterated topline mid‑2024 and completed a positive safety review of the 10 mg cohort, enabling higher future dosing if needed .
  • Pipeline execution: PRS‑220 Phase 1 in healthy volunteers remained on track for 2H’23 top line; PRS‑400 advanced toward DC nomination in 2H’23, with new preclinical data slated for ATS 2023 .
  • Partnered IO momentum: Seagen dosed first patient in SGN‑BB228/PRS‑346 (4‑1BB/CD228), triggering a $5M milestone; Servier continued dose escalation in PRS‑344/S095012 (4‑1BB/PD‑L1) .
    • Quote: “With this broader clinical footprint…we are witnessing the positive impact in patient screens…We anticipate this to result in a meaningful uptick in the rate of patients randomized” .

What Went Wrong

  • Revenue declined 82% YoY to $1.94M as prior‑year milestones and collaboration mix did not repeat; net loss widened to $(13.18)M; EPS of −$0.18 compared unfavorably to a −$0.14 loss per Zacks consensus .
  • Cash and investments fell to $48.4M from $59.2M at year‑end as the company funded operations; although operating cash burn improved vs Q1’22, the balance remains a watch item ahead of mid‑2024 elarekibep data .
  • Continued dependence on ex‑US partners and grant income to offset R&D spend; R&D remained elevated at $13.4M, driven by proprietary respiratory programs, partly offset by lower IO spend .

Financial Results

Core P&L and Cash Metrics

MetricQ1 2022Q1 2023
Revenue ($USD Millions)$10.988 $1.936
Net Loss ($USD Millions)$(5.101) $(13.183)
EPS (Basic/Diluted)$(0.07) $(0.18)
R&D Expense ($USD Millions)$14.066 $13.424
G&A Expense ($USD Millions)$4.379 $4.023
Operating Cash Flow ($USD Millions)$(22.643) $(10.996)

Liquidity

MetricQ3 2022Q4 2022Q1 2023
Cash, Cash Equivalents & Investments ($USD Millions)$69.8 $59.2 $48.4

Revenue Breakdown by Partner

Partner Revenue ($USD Thousands)Q1 2022Q1 2023
Seagen$1,189 $1,423
AstraZeneca$4,753 $434
Servier$4,734 $(74)
Genentech$312 $153
Total$10,988 $1,936

Estimates vs Actuals

MetricActualConsensusBeat/Miss
EPS (Basic/Diluted)$(0.18) $(0.14) (Zacks) Miss
  • S&P Global consensus estimates were unavailable for PIRS at the time of this analysis.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Elarekibep (AZD1402) Phase 2a topline (asthma)Program timing“Q3 2023” (Q3’22 call) Mid‑2024 (Q4’22 call and reaffirmed Q1’23) Delayed in Q4’22; Maintained in Q1’23
PRS‑220 Phase 1 topline2H 2023“Next year” (2023) (Q3’22) 2H 2023 (Q4’22/Q1’23) Maintained
PRS‑400 DC nomination2H 2023“Later this year” (2023) (Q3’22) 2H 2023 (Q1’23) Maintained
Seagen SGN‑BB228/PRS‑346Phase 1 start“Initiate in coming months” (Q3’22) First patient dosed; $5M milestone achieved (Q1’23) Achieved

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3’22, Q4’22)Current Period (Q1’23)Trend
Elarekibep enrollment & timelineQ3’22: Completed 10mg safety enrollment; targeted Q3’23 topline; protocol amendments to broaden funnel . Q4’22: Topline shifted to mid‑2024; added sites/countries; protocol changes approved .Reaffirmed mid‑2024; positive screening trend with >100 sites planned; 10mg DPI safety review completed .Stabilizing after delay; execution improving
PRS‑220 (IPF)Q3’22: Phase 1 initiated; 2023 readout; grant support . Q4’22: 2H’23 results .On track for 2H’23; new data at ATS showing collagen reduction in inhaled model .On track
PRS‑400 (Muco‑obstructive)Q3’22: Preclinical PoC; advancing; avoid systemic Notch toxicities .Data at ATS on reducing goblet metaplasia/mucus; DC nomination targeted 2H’23 .Progressing
IO portfolio & milestonesQ3’22: Servier PRS‑344 escalation ongoing; Seagen program to start; BOS‑342 to clinic .Seagen BB228 first‑patient dosed; $5M milestone; Servier escalation continues; BOS‑342 to begin Phase 1 “in coming months” .Positive partner momentum
Cash runway & gatingQ4’22: >12 months; gating PRS‑220/400 to prioritize elarekibep .Reaffirmed cash >12 months; prepared to gate Phase 2 readiness (PRS‑220) and IND‑enabling (PRS‑400) if needed .Discipline maintained

Management Commentary

  • “Top line results…are anticipated to be reported by the middle of 2024…This readout will focus on the 3 milligram DPI dose versus placebo.”
  • “The safety review of the 10 milligram DPI dose cohort…was successfully completed…[enables] higher doses to be evaluated in the future if needed.”
  • “We expect to report Phase 1 [PRS‑220] study results in the second half of this year…[and] present new preclinical PRS‑220 data at the ATS 2023 International Conference.”
  • On PRS‑343 (cinrebafusp alfa): “An unconfirmed 100% objective response rate…in the five patients…We are considering a range of transactions…to facilitate the continuation of this program.”
  • “Cash, cash equivalents and investments totaled $48.4 million…The company believes that operations are sufficiently funded for more than the next 12 months.”

Q&A Highlights

  • PRS‑220 path post‑FibroGen readout: Management expects a positive pamrevlumab Phase 3 could be a strong inflection point; multiple funding options (equity, partnering) contemplated; if the trial fails, Pieris would assess reasons (e.g., under‑dosing, systemic exposure limits) and still sees rationale for local inhaled CTGF blockade .
  • PRS‑343 strategy: Not pursuing internally; exploring spin‑out or partnership given compelling early gastric cancer activity; more color expected in 2H’23 .
  • Servier PRS‑344 timing: Dose escalation continues; expansion decisions depend on OBD/RP2D and competitive landscape in 2H’23; flexible expansion design .
  • Delivery modality: Nebulized PRS‑220 viewed as suitable for IPF population; modern handheld nebulizer delivery time “minutes” .

Estimates Context

  • S&P Global consensus data were unavailable for PIRS at the time of this analysis; therefore, we could not anchor to S&P for revenue or EPS.
  • As a proxy, Zacks/ Yahoo Finance indicated Q1’23 EPS of −$0.18 vs a consensus of −$0.14 (miss) .
  • Given the lumpy nature of collaboration revenue, we expect estimate models to reduce near‑term revenue run‑rate and maintain operating loss forecasts until clearer milestones or partnering revenues materialize (especially around elarekibep and PRS‑220).

Key Takeaways for Investors

  • Execution on inhaled respiratory strategy remains the core driver: elarekibep topline mid‑2024 is the pivotal catalyst; PRS‑220 Phase 1 2H’23 provides modality/tolerability de‑risking and potential partnering leverage .
  • Financials reflect “milestone‑light” quarter; YoY revenue down sharply and EPS missed proxy consensus; however, operating cash flow improved vs Q1’22, and cash runway >12 months under prudent gating .
  • Partnered IO portfolio de‑risks cash needs and offers embedded optionality (Seagen, Servier, Boston Pharma), with recent $5M milestone validating the platform .
  • Watch for near‑term scientific catalysts (ATS data for PRS‑220/400) and business development around PRS‑343 to potentially extend runway without heavy equity reliance .
  • Risk skew is tied to AstraZeneca’s elarekibep study execution and data; management cited improved screening/site expansion but investors should monitor quarterly 10‑Q disclosures and call updates for enrollment progress .
  • For trading: absence of S&P consensus and small‑cap liquidity can amplify move on incremental program news; pre‑ATS and mid‑2024 milestones are likely narrative inflection points; downside risk if program timelines slip or partnering stalls .

Source Documents

  • Q1 2023 10‑Q (filed May 11, 2023): revenue, P&L, cash/investments, partner revenue mix, cash flows .
  • Q1 2023 earnings call transcript (May 10, 2023): program updates, cash runway, milestones .
  • Q4 2022 call (Mar 29, 2023): timing shift to mid‑2024; cash year‑end; runway/gating .
  • Q3 2022 call (Nov 2, 2022): initial Q3’23 timing; cash at 9/30/22 .
  • Q1 2023 press release (May 10, 2023): financial results and business update .
  • Proxy estimate source (Zacks/Yahoo): EPS miss vs proxy consensus .