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Revolution Medicines, Inc. (RVMD)·Q2 2024 Earnings Summary

Executive Summary

  • RVMD reported Q2 2024 net loss of $133.2M (-$0.81/share) as R&D spend ramped for multiple RAS(ON) programs; revenue was $0 following the 2023 Sanofi collaboration termination .
  • Management reiterated plans to initiate the first registrational Phase 3 trial (RASolute 302) of RMC‑6236 in 2L metastatic pancreatic cancer in 2024 and to launch an NSCLC registrational study in 4Q 2024, positioning late‑stage transition catalysts in 2H24–2025 .
  • Updated July guidance raised full‑year GAAP net loss to $560–$600M (from $480–$520M in May), reflecting accelerated development; cash, cash equivalents and marketable securities were $1.59B at 6/30, supporting runway into 2027 .
  • S&P Global consensus estimates for Q2 2024 could not be retrieved due to API limits, so beat/miss vs Street could not be assessed (see Estimates Context) [GetEstimates: limit exceeded].

What Went Well and What Went Wrong

What Went Well

  • Strong clinical momentum for RMC‑6236 in PDAC: preliminary median PFS 8.1 months in KRAS G12X and 7.6 months in all RAS‑mutated tumors; OS not estimable at cutoff, underpinning Phase 3 start in 2024 .
  • Clear regulatory and development path: FDA feedback aligned on high‑level Phase 3 design and 300mg daily dose for PDAC; management also on track for an NSCLC registrational study in 4Q 2024 .
  • Organizational scaling for late stage/commercial: appointment of Frank Clyburn (ex‑Merck oncology/Keytruda) to the board and key leadership hires in medical affairs, corporate affairs, drug safety, and program leadership .
    • “We have made meaningful progress… preparing RMC‑6236… to move into its first pivotal monotherapy studies… These data have increased our confidence… and reinforce our commitment to initiate our first registrational study this year.” — CEO Mark Goldsmith .

What Went Wrong

  • Operating loss widened y/y as R&D spend increased (R&D $134.9M vs $98.0M; G&A $21.7M vs $14.6M), driving net loss of $133.2M vs $98.3M in Q2 2023 .
  • FY24 GAAP net loss guidance raised to $560–$600M (from $480–$520M), reflecting higher development costs and program breadth .
  • No collaboration revenue following Sanofi termination (revenue $0 vs $3.8M y/y), reducing reported top line and increasing reliance on financing runway .

Financial Results

Income Statement Snapshot (USD Millions, except per-share)

MetricQ4 2023Q1 2024Q2 2024
Revenue$0.7 $0.0 $0.0
R&D Expense$148.5 $118.0 $134.9
G&A Expense$32.2 $22.8 $21.7
Total Operating Expenses$180.7 $140.9 $156.6
Net Loss$(161.5) $(116.0) $(133.2)
Net Loss per Share$(1.14) $(0.70) $(0.81)
Weighted Avg. Shares (M)141.2 164.7 165.1

Liquidity (USD Millions)

MetricQ4 2023Q1 2024Q2 2024
Cash, Cash Equivalents & Marketable Securities$1,852.96 $1,703.54 $1,590.72
Working Capital$1,735.43 $1,635.48 $1,519.40
Cash Runway CommentaryInto 2027 Into 2027 Into 2027

Clinical KPIs (Q2 2024 – RMC‑6236 in PDAC, data cutoff 5/11/24)

KPIValue
Safety population127 patients across 160–300 mg QD
Grade ≥3 TRAEs~22%
Dose modifications28% (interruptions/reductions)
Discontinuations due to TRAEs0
Median PFS (KRAS G12X, n=42)8.1 months (95% CI: 5.9–NE)
Median PFS (All RAS‑mutated, n=56)7.6 months (95% CI: 5.3–NE)
Overall SurvivalNot estimable; 95% CI lower bound 8.5 months

Versus Estimates (Q4’23–Q2’24)

MetricQ4 2023Q1 2024Q2 2024
Revenue ConsensusN/A — SPGI data unavailable (API limit)
EPS ConsensusN/A — SPGI data unavailable (API limit)

Note: We attempted to retrieve S&P Global consensus (Revenue, EPS) but the service returned a daily request limit error, so we cannot assess beats/misses this quarter [GetEstimates: limit exceeded].

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
GAAP Net LossFY 2024$(480)M–$(520)M (May 8) $(560)M–$(600)M (July 15; reiterated Aug 7) Lowered earnings outlook (larger loss)
Stock‑Based Compensation (non‑cash)FY 2024$70M–$80M $70M–$80M Maintained
Cash RunwayMulti‑yearInto 2027 Into 2027 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’23 and Q1’24)Current Period (Q2’24)Trend
RMC‑6236 pivotal path (PDAC, NSCLC)Plan to initiate 2L PDAC and 2L NSCLC pivotal trials in 2H24; PFS maturity gating; FDA engagement on dose/design FDA alignment on 300mg and high‑level PDAC design; Phase 3 PDAC (RASolute 302) to start in 2024; NSCLC registrational to start 4Q24 Accelerating toward registrational
First‑line strategy & combinationsEarly combos launched: 6236+6291; 6236+pembro (±chemo); exploring GI SOC combos 6236+chemo in 1L PDAC enrolling; 6236+pembro (±chemo) NSCLC initial data expected 4Q24 Building first‑line options
Doublet (6236+6291)Rationale to improve depth/durability; initial clinical data 2H24 Initial clinical PK/safety/tolerability/activity data in 4Q24; NSCLC G12C focus Data readout near‑term
G12D program (RMC‑9805)First‑in‑human progressing; initial safety/activity 2H24 Initial clinical PK/safety/tolerability/activity in 4Q24; tumor mix reflective of G12D epidemiology Progressing dose optimization
Regulatory endpointsPFS prioritized; OS discussed for NSCLC/PDAC Dual primary endpoints PFS and OS anticipated in PDAC Phase 3 Clarified endpoint strategy

Management Commentary

  • “We disclosed recent data… showing compelling preliminary PFS and OS… These data… reinforce our commitment to initiate our first registrational study this year.” — CEO Mark Goldsmith .
  • “We ended the second quarter of 2024 with $1.59 billion in cash and investments.” — CFO Jack Anders .
  • “Based on initial feedback from the U.S. Food and Drug Administration… including a 300 mg daily dose, the company expects to initiate its Phase 3 registrational trial… called RASolute 302, this year.” — Press release .
  • “We are reiterating the updated projected full year 2024 GAAP net loss… $560 million and $600 million… [and] project current cash… can fund planned operations into 2027.” — Press release .

Q&A Highlights

  • NSCLC Phase 3 design and G12C comparator: team acknowledged complexity around potential KRAZATI approval and whether docetaxel vs a G12C inhibitor would serve as comparator; final plan to be aligned with FDA and data timing .
  • Doublet enrollment/expectations: RMC‑6236+RMC‑6291 enrolling predominantly NSCLC and CRC KRAS G12C; initial goals are safety/combinability with qualitative activity differentiation rather than preset ORR/PFS thresholds .
  • PDAC dataset maturity: censoring was standard for early cutoff; registrational readouts will use event‑driven analyses to avoid immaturity concerns .
  • First‑line combinations: 6236+pembro (±chemo) safety readouts expected to inform earlier‑line strategies including potential adjuvant; colorectal strategy viewed primarily as combination‑driven .
  • Lung PFS expectations: management emphasized clearing standard‑of‑care PFS as first bar while deferring specific thresholds until data disclosure .

Estimates Context

  • We attempted to pull S&P Global (SPGI) consensus (Revenue, EPS, target price) for Q2 2024 and prior quarters, but the API returned a daily request limit error; thus, we cannot assess beats/misses vs Wall Street this quarter [GetEstimates: limit exceeded].
  • As a result, tables show “N/A” for consensus. We will update comparisons upon SPGI availability.

Key Takeaways for Investors

  • Phase 3 inflection: RVMD expects to initiate the first registrational PDAC study (RASolute 302) in 2024 with dual primary endpoints (PFS, OS); an NSCLC registrational study is slated for 4Q 2024 — key multi‑year value drivers .
  • Multiple 4Q 2024 catalysts: updated NSCLC monotherapy data, initial 6236+pembro data in NSCLC, initial 6236+6291 doublet data, and first RMC‑9805 clinical dataset — a concentrated catalyst window .
  • Safety/tolerability remains supportive: 6236 PDAC monotherapy showed ~22% grade ≥3 TRAEs, 28% dose modifications, and no TRAE‑related discontinuations across 127 patients — favorable profile for combinations and late‑stage trials .
  • Spending ramp reflects ambition: FY24 GAAP net loss guidance raised to $560–$600M as programs advance; liquidity of $1.59B funds operations into 2027, mitigating financing risk near term .
  • Competitive dynamics (NSCLC G12C segment) will shape design details; management is engaging FDA on appropriate comparators as the landscape evolves .
  • Near‑term trading setup: concentrated 4Q data flow and Phase 3 initiations could be major stock catalysts; watch for updated durability/PFS metrics and safety readouts in key combinations .
  • Medium‑term thesis: If 6236 delivers robust PFS/OS in PDAC and competitive PFS in NSCLC with manageable safety, RVMD could establish a RAS(ON) backbone strategy across lines and genotypes, with combinations extending reach into first line .