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Regeneron Pharmaceuticals, Inc. (REGN - Free Report) reported first-quarter 2017 results wherein earnings missed estimates while revenues beat expectations.
The company reported first-quarter 2017 earnings (including the impact of share-based compensation expenses and tax adjustments) of $2.16 per share, missing the Zacks Consensus Estimate of $2.50 and were up from $1.59 in the year-ago quarter.
Excluding share-based compensation expenses, Regeneron’s earnings came in at $2.92 per share, up from $2.40 reported in the year-ago quarter.
Total revenue in the first quarter increased 9.8% year over year to $1.32 billion driven by strong sales of eye treatment, Eylea. Revenues were above the Zacks Consensus Estimate of $1.29 billion. Total revenue comprises net product sales and collaboration revenues.
Regeneron’s share price movement shows that the stock has outperformed the Zacks categorized Medical-Biomedical and Genetics industry in the past one year. Specifically, the stock gained 13.2% during this period, while the industry declined 2.8%.
Regeneron has co-developed Eylea with the HealthCare unit of Bayer AG (BAYRY - Free Report) . The company is solely responsible for the U.S. sales of the eye drug and is entitled to profits. However, it shares profits and losses equally with Bayer from ex-U.S. Eylea sales, except in Japan, where the company receives a royalty on the net sales.
Quarterly Highlights
Net product sales increased to $858.2 million in the reported quarter, up 9.5% year over year. The majority of sales came from Eylea in the U.S. ($854 million, up 9.3%). Sales of Eylea in ex-U.S. markets were $484 million, up from $419 million reported in the year-ago quarter.
Revenues also include Sanofi (SNY - Free Report) and Bayer collaboration revenues of $404 million in first-quarter 2017, compared to $399 million in the year-ago quarter. Collaboration revenues from Sanofi were $210.4 million in the quarter, compared with $219.7 million a year ago. Praluent recorded global net sales of $36 million in the reported quarter, up from $13 in the year-ago quarter. We note Praluent has been co-developed in collaboration with Sanofi. Product sales for Praluent are recorded by Sanofi, while Regeneron shares profits or losses from the commercialization of the drug.
R&D expenses increased 7.9% while selling, general and administrative (SG&A) decreased 2.5% during the quarter.
2017 Outlook Updated
In 2017, Regeneron expects U.S. Eylea net sales to grow in single digits. The company now expects adjusted unreimbursed R&D expenses in the range of $950–$1,025 million. Adjusted SG&A costs are now projected in the range of $1.140–$1.200 billion compared to the earlier forecast $1.175–$1.250 billion.
We note that the European Commission approved a dosing regimen of 300mg for Praluent to be given every four weeks. The FDA recently approved Dupixent (dupilumab) Injection for the treatment of adults with moderate-to-severe atopic dermatitis (AD). Meanwhile, a phase III study of Dupixent in adolescent patients (12-17 years of age) with moderate-to-severe atopic dermatitis was initiated in first-quarter 2017.
A phase III study of Dupixent in pediatric patients (6-11 years of age) with uncontrolled persistent asthma was initiated in second-quarter 2017.
Regeneron Pharmaceuticals, Inc. Price and Consensus
Regeneron’s first-quarter results were mixed where earnings missed estimates while revenues beat expectations. The FDA’s approval of Dupixent was a major boost to the company’s portfolio. Regeneron has earlier suffered a few setbacks related to its pipeline. Hence, we expect investor focus to remain on the performance of Eylea and Praluent, along with other pipeline-related updates.
Zacks Rank
Regeneron currently carries a Zacks Rank #2 (Buy) stock. A better-ranked stock in the healthcare sector is Infinity Pharmaceuticals, Inc. which currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Infinity’ loss estimates narrowed to $1.03 from $1.43 for 2017 over the past 60 days. The company recorded a positive earnings surprise in three of the last four quarters, the average being 36.64%.Its share price increased 43.7% year to date.
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Regeneron (REGN) Q1 Earnings Miss, Revenues Beat Estimates
Regeneron Pharmaceuticals, Inc. (REGN - Free Report) reported first-quarter 2017 results wherein earnings missed estimates while revenues beat expectations.
The company reported first-quarter 2017 earnings (including the impact of share-based compensation expenses and tax adjustments) of $2.16 per share, missing the Zacks Consensus Estimate of $2.50 and were up from $1.59 in the year-ago quarter.
Excluding share-based compensation expenses, Regeneron’s earnings came in at $2.92 per share, up from $2.40 reported in the year-ago quarter.
Total revenue in the first quarter increased 9.8% year over year to $1.32 billion driven by strong sales of eye treatment, Eylea. Revenues were above the Zacks Consensus Estimate of $1.29 billion. Total revenue comprises net product sales and collaboration revenues.
Regeneron’s share price movement shows that the stock has outperformed the Zacks categorized Medical-Biomedical and Genetics industry in the past one year. Specifically, the stock gained 13.2% during this period, while the industry declined 2.8%.
Regeneron has co-developed Eylea with the HealthCare unit of Bayer AG (BAYRY - Free Report) . The company is solely responsible for the U.S. sales of the eye drug and is entitled to profits. However, it shares profits and losses equally with Bayer from ex-U.S. Eylea sales, except in Japan, where the company receives a royalty on the net sales.
Quarterly Highlights
Net product sales increased to $858.2 million in the reported quarter, up 9.5% year over year. The majority of sales came from Eylea in the U.S. ($854 million, up 9.3%). Sales of Eylea in ex-U.S. markets were $484 million, up from $419 million reported in the year-ago quarter.
Revenues also include Sanofi (SNY - Free Report) and Bayer collaboration revenues of $404 million in first-quarter 2017, compared to $399 million in the year-ago quarter. Collaboration revenues from Sanofi were $210.4 million in the quarter, compared with $219.7 million a year ago. Praluent recorded global net sales of $36 million in the reported quarter, up from $13 in the year-ago quarter. We note Praluent has been co-developed in collaboration with Sanofi. Product sales for Praluent are recorded by Sanofi, while Regeneron shares profits or losses from the commercialization of the drug.
R&D expenses increased 7.9% while selling, general and administrative (SG&A) decreased 2.5% during the quarter.
2017 Outlook Updated
In 2017, Regeneron expects U.S. Eylea net sales to grow in single digits. The company now expects adjusted unreimbursed R&D expenses in the range of $950–$1,025 million. Adjusted SG&A costs are now projected in the range of $1.140–$1.200 billion compared to the earlier forecast $1.175–$1.250 billion.
We note that the European Commission approved a dosing regimen of 300mg for Praluent to be given every four weeks. The FDA recently approved Dupixent (dupilumab) Injection for the treatment of adults with moderate-to-severe atopic dermatitis (AD). Meanwhile, a phase III study of Dupixent in adolescent patients (12-17 years of age) with moderate-to-severe atopic dermatitis was initiated in first-quarter 2017.
A phase III study of Dupixent in pediatric patients (6-11 years of age) with uncontrolled persistent asthma was initiated in second-quarter 2017.
Regeneron Pharmaceuticals, Inc. Price and Consensus
Regeneron Pharmaceuticals, Inc. Price and Consensus | Regeneron Pharmaceuticals, Inc. Quote
Our Take
Regeneron’s first-quarter results were mixed where earnings missed estimates while revenues beat expectations. The FDA’s approval of Dupixent was a major boost to the company’s portfolio. Regeneron has earlier suffered a few setbacks related to its pipeline. Hence, we expect investor focus to remain on the performance of Eylea and Praluent, along with other pipeline-related updates.
Zacks Rank
Regeneron currently carries a Zacks Rank #2 (Buy) stock. A better-ranked stock in the healthcare sector is Infinity Pharmaceuticals, Inc. which currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Infinity’ loss estimates narrowed to $1.03 from $1.43 for 2017 over the past 60 days. The company recorded a positive earnings surprise in three of the last four quarters, the average being 36.64%.Its share price increased 43.7% year to date.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
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