What's In Store For BioDelivery (BDSI) This Earnings Season?

BioDelivery Sciences International, Inc. (NASDAQ:BDSI) is expected to report first-quarter 2017 results later this month. Last quarter, the company’s loss was wider than expected.

Year to date, BioDelivery’s shares have underperformed the Zacks classified Medical-Biomed/Genetics industry. In fact, the stock gained 2.8% during the period, while the industry recorded an increase of 3.9%.



BioDelivery missed expectations in two of the last four quarters and met estimates in the other two. The average negative earnings surprise for the last four quarters is 4.74%.

Let’s see how things are shaping up for this announcement.

Factors to Consider

BioDelivery’s key products include Belbuca (chronic pain) and Bunavail (opioid-dependence).

Bunavail’s sales performance has been lackluster so far. BioDelivery is working on improving Bunavail’s performance. To this end, BioDelivery cut the size of its sales force. The company also reduced the number of sales territories and is now focusing on the most growth-oriented territories. Apart from restructuring Bunavail’s sales territories, the company is working on securing new or improved positioning on other managed care contracts either on an exclusive or preferred status. BioDelivery is also running a highly targeted Bunavail-focused, direct-to-patient digital advertising campaign in four cities. With a reduced cost structure and growth opportunities, BioDelivery expects Bunavail to attain profitability by the end of 2017.

In May 2017, the FDA approved a supplemental new drug application (sNDA) for Bunavail’s label expansion and to include its use for the initiation of buprenorphine treatment for opioid dependence.

Meanwhile, the start of Belbuca’s sales has been slower than expected due to pain market pressures. The company launched Belbuca in the U.S. in Feb 2016.

However, in Jan 2017, BioDelivery announced the closing of its previously announced agreement with Endo Pharmaceuticals (NASDAQ:ENDP) , terminating the licensing of rights of the latter for Belbuca (buprenorphine) buccal film (CIII). As a result, the worldwide rights to Belbuca have now been transferred back to BioDelivery. The return of rights to Belbuca is expected to be accretive to BioDelivery's net income and earnings per share in 2017.

Earnings Whispers

Our proven model does not conclusively show that BioDelivery is likely to beat on earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.

Zacks ESP: The Earnings ESP for BioDelivery is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at a loss of 9 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: BioDelivery’s has Zacks Rank #3. Although the company’s favorable Zacks Rank increases the predictive power of ESP, its 0.00% Earnings ESP makes surprise prediction difficult.

Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Some stocks in the healthcare sector that have both a positive Earnings ESP and a favorable Zacks Rank are:

Editas Medicine, Inc. (NASDAQ:EDIT) is expected to release results on May 15. The company has an Earnings ESP of 32.26% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cidara Therapeutics, Inc. (NASDAQ:CDTX) is expected to release results on May 11. The company has an Earnings ESP of 1.14% and a Zacks Rank #3.

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