Biogen's second-quarter report was "fine," according to one analyst. But without an update on its strategy for life after Aduhelm, Biogen stock fell.
The company is at a turning point. Biogen has effectively abandoned its commercial efforts for the controversial Alzheimer's drug, Aduhelm. Meanwhile, Chief Executive Michel Vounatsos is stepping down once the board finds his replacement.
Biogen's earnings release didn't offer an update on either matter, analysts noted. On today's stock market, Biogen stock skidded 5.8% to 207.49. Mizuho Securities analyst Salim Syed — who called the report "fine" — noted sales of spinal muscular atrophy treatment Spinraza and biosimilars came in light.
Wedbush analyst Laura Chico said Biogen's business continues to decline.
"We continue to see Biogen in a holding pattern and while the commercial results are better than anticipated, this remains a declining business," she said in a note. She has a neutral rating and 188 price target on Biogen stock.
Biogen Stock: Misses Within Its Sales Beat
Biogen earned $5.25 per share, minus some items, on $2.59 billion in second-quarter sales. On a year-over-year basis, Biogen earnings dipped 4.5% and sales decreased 7%. Excluding the impact of exchange rates, sales fell 5%.
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Both metrics beat forecasts, however. Biogen stock analysts were looking for $4.08 in adjusted earnings per share and $2.48 billion in sales, according to FactSet.
Sales of Biogen's biggest product, multiple sclerosis treatment Tecfidera, tumbled more than 18% to roughly $398 million. Tecfidera is now facing generic rivals. Still, that was above views for $344 million, Mizuho's Syed said. Sales of another MS drug, Tysabri, fell 1.5% to about $516 million, but beat expectations.
But Spinraza sales toppled almost 14% to a hair north of $431 million and missed projections for $439 million, Syed said. Biosimilar sales also came in short at $194 million.
"Somewhat surprisingly," Biogen raised its guidance for the year, RBC Capital Markets analyst Brian Abrahams said in a report. Now, Biogen expects $9.9 billion to $10.1 billion in sales and $15.25 to $16.75 per share in adjusted earnings.
It previously targeted adjusted income of $15.13 a share on sales of $9.85 billion. Biogen stock analysts had projected adjusted income of $15.47 per share and $9.84 billion in sales.
Biogen Trims Its Pipeline
The company also is making some notable cuts to its pipeline, RBC's Abrahams said.
Importantly, Biogen remains on track to disclose the results of final-phase testing for another Alzheimer's treatment, dubbed lecanemab, this fall. But the company scrapped a schizophrenia drug on Wednesday that didn't meet any of its goals in testing.
"We do not expect any significant downside on this setback as we do not believe any value was attributed to this asset," Abrahams said of the schizophrenia drug.
He also noted Biogen's pipeline no longer includes two experimental treatments for multiple sclerosis and Alzheimer's disease.
"We believe this highlights further the high-risk/high-reward nature of their pipeline, though the clearly lower bar for discontinuing programs after initial setbacks should be welcome by investors," he said.
Abrahams has an outperform rating and 264 price target on Biogen stock.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
