Following inactive movement during the day, stock for Unity Biotechnology, Inc. (NASDAQ: UBX) saw a fast climb in the after-hours. After a modest 6.36% rise during yesterday’s current market, UBX shot up by a further 13.17% following the closure of trade. UBX experienced a similar growth spurt a week ago, ballooning up by almost 25%, after a month of steady decline. The biotechnology therapeutics firm, specializing in anti-aging treatment has a number of candidates in its pipeline, at various clinical phases. Yesterday’s release of financial results for the prior year and its last quarter, has presumably triggered market interest surrounding UBX.
Unity Biotech’s Financial Results
Unity continued to hold an impressive liquidity position of $90.1M, despite the fall from $115.6M in the preceding year. Management reports this level of cash holding is sufficient to finance operations up to March 2023. Moreover, operating loss in the prior year fell to $56.7M, down from $93.9M in 2020, indicating an improvement towards breakeven.
However, the reduction in loss correlates less to business efficiency and more to a decrease in operational spending and overall activity. Cash operations falling from $78.3M to $45.1M, does not necessarily indicate enhancement in value-adding capability from a business standpoint. Similarly, R&D expenditure saw a significant decline from $38.4M to $28.9M. This was a result of lower research activities. Safety-based studies decreased by a considerable margin, whilst osteoarthritis studies had been discontinued entirely. This could potentially raise concerns, as the reduction in operational loss correlates to reduced activity. As a result, this translates to a decreasing potential of successful candidates launching within the market.
Unity Biotech Pipeline of Candidates
The fate of UBX is primarily tied to the progress of its lead candidate UBX1325. The release of results of the drug’s 12-week phase 2a safety trial will be near June 2022. Similarly, the announcement of the efficacy results of a 24-week study will take place towards the end of the year. The announcement would prove crucial for Unity Biotech, along with the long-term prospects of its stock trajectory.
UBX sprung into action in the aftermarket, following a relatively low-activity trajectory. The frenzy had come following the announcement of Unity’s financial results for the previous year. Moreover, the report to shareholders includes critical updates about its lead candidate UBX1325, along with the dates of important milestones.