Regeneron Pharmaceuticals snagged a quarterly beat Friday, reporting triple-digit sales growth almost entirely attributed to its Covid cocktail — and REGN stock rose.
The Covid treatment generated $2.3 billion in fourth-quarter sales, handily beating expectations for $1.9 billion, Piper Sandler analyst Christopher Raymond said in a report to clients. That helped total sales rocket 104% year over year. But excluding the Covid drug left Regeneron's revenue up a more modest 17%.
Importantly, the future of antibody drugs for Covid is uncertain amid omicron's spread. The variant undoes the effectiveness of antibody drugs from Regeneron and Eli Lilly. U.S. officials have restricted their use to patients likely to have non-omicron infections.
With omicron responsible for most Covid cases in the country today, Regeneron is working on a next-generation antibody treatment. It could begin human studies in the coming months, Raymond said. He kept his overweight rating on REGN stock.
REGN Stock: Mixed Product Sales
The fourth quarter was relatively mixed for Regeneron.
Total sales were $4.95 billion, easily north of analyst predictions of $4.56 billion, according to FactSet. The company's adjusted earnings rocketed 149% to $23.72. Analysts expected just $20.40 a share.
Regeneron had already pre-announced sales of blockbuster eye drug Eylea, which beat estimates. The company records sales of Eylea in the U.S. with partner Bayer recording sales abroad.
Sales of Sanofi-partnered Dupixent — a treatment for eczema, asthma and nasal polyps — easily beat forecasts with $1.77 billion in sales. But revenue from lung cancer drug Libtayo came up short at $458.2 million. Sanofi records sales of Dupixent, but splits profits with Regeneron. Regeneron holds onto Libtayo sales in the U.S. while Sanofi records sales abroad.
Under those deals, Regeneron reported $372.4 million in collaboration revenue with Bayer and $517.9 million from its Sanofi deal. Both metrics climbed, but lagged analysts' expectations, RBC Capital Markets analyst Kennen MacKay said in his note to clients.
This hints "at a weaker-than-expected ex-U.S. quarter potentially impacted by Covid," he said. But he kept his sector perform rating and 679 price target on REGN stock.
On today's stock market, REGN stock closed up a fraction at 622.96.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
