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Investors Business Daily
Technology
ALLISON GATLIN

Regeneron Takes A Ghastly Turn As High-Dose Eylea Lags And Biosimilars Loom

Regeneron stock toppled Thursday after the biotech giant reported lighter-than-expected sales of its new eye disease drug.

Though U.S. revenue from Regeneron Pharmaceuticals' standard Eylea came in ahead of forecasts at $1.54 billion, the company's newer high-dose Eylea lagged projections at $392 million. Analysts called for Eylea HD to generate $415 million to $425 million, Piper Sandler analyst Christopher Raymond said in a report.

The news comes as standard Eylea faces competition from biosimilar copycats. But RBC Capital Markets analyst Brian Abrahams noted biosimilars are being offered at a limited discount to Eylea, and it will take some time for insurers to add them to formularies.

"While this may disappoint some, especially given the shorter time to convert the market given biosimilar entry, we continue to believe intermediate-term effects of the biosimilar are overstated and believe the Street likely recognizes consensus numbers were likely overly optimistic given second quarter benefiting from the post J-code uptick," he said in a report.

Regeneron stock lost 9.2% and closed at 838.20. Shares have fallen roughly 33% since hitting an intraday record high at 1,211.20 on Aug. 27.

Regeneron Stock: Praluent Beats, But Libtayo Misses

Across all products, Regeneron's sales advanced 11% to $3.72 billion, beating expectations for $3.68 billion, according to FactSet. Adjusted earnings of $12.46 per share handily topped forecasts for $11.70 a share, and rose 8% year over year.

U.S. sales of Praluent, which Regeneron books as revenue in its partnership with Sanofi, came in $4 million north of expectations at $53 million, Piper Sandler's Raymond said.

Global sales of cancer treatment Libtayo surged 25% to $289 million. But that missed views for $313 million.

Collaboration revenue from Sanofi and Bayer topped projections at $1.26 billion and $391 million, respectively. Regeneron and Bayer partner on Eylea.

RBC's Abrahams kept his outperform and 1,260 price target on Regeneron stock.

"Near- and long-term Eylea/HD consensus expectations likely need to moderate and the third-quarter print should catalyze this, but rest of business remains very strong and with shares having pulled back considerably, best-in-class growth beyond next year and multiple near-term pipeline catalysts over the next 12 months, we see meaningful upside potential for shares," he said.

Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.

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