Back to top

Analyst Blog

BioMarin Pharmaceutical Inc.’s (BMRN - Analyst Report) fourth quarter 2012 loss of 43 cents per share was wider than the Zacks Consensus Estimate of a loss of 27 cents per share and the year-ago loss of 23 cents per share. The wider loss was due to higher operating expenses.

For full year 2012, BioMarin reported a loss of 95 cents per share, wider than the year-ago loss of 48 cents and the Zacks Consensus Estimate of a loss of 79 cents per share. The company’s total revenues for the year 2012 came in at $500.7 million, up 13.4%. Reported revenues beat the Zacks Consensus Estimate of $495 million.

The Quarter in Details

Total revenues climbed 22.3% to $131.9 million in the reported quarter, beating the Zacks Consensus Estimate of $129 million. The increase in total revenues was attributable to higher net product revenues.

Net product revenues in the reported quarter climbed approximately 23.5% to $131 million. Naglazyme, approved for treating MPS-VI, a rare genetic enzyme deficiency disorder, accounted for a significant portion of the net product revenues recorded in the quarter. Revenues from the drug shot up 31% to $63 million during the quarter.

Net product revenues from Kuvan tablets, indicated for treating mild-to-moderate forms of phenylketonuria, were up 29.9% to $40 million. BioMarin is conducting a randomized, placebo-controlled, 13-week outcomes study (PKU-016) in patients treated with Kuvan. The company recently announced positive results from the PKU-016 study. BioMarin now plans to submit data from the study to the US Food and Drug Administration (FDA) to include this in the Kuvan label.

BioMarin recorded revenues from another enzyme replacement therapy, Aldurazyme, co-marketed by Sanofi (SNY - Analyst Report), of $24.6 million, up 3.4%.

Net revenues from Firdapse, currently marketed in the EU, were $3.4 million in the quarter, up 3% year over year. Firdapse was launched in Apr 2010, in the EU, for treating patients suffering from LEMS, a rare autoimmune disorder. The drug has performed disappointingly since launch.

Both research & development (R&D) expenses (up 45.7%) and selling, general & administrative (SG&A) expenses (up 13.6%) shot up in the quarter, leading to a 38.3% rise in total operating expenses.

Pipeline Update

In Nov 2012, BioMarin reported positive results from the much awaited phase III study of Vimizim (GALNS) for the treatment of patients suffering from mucopolysaccharidosis Type IVA (MPS IVA) or morquio A syndrome.

The company now plans to seek US approval for Vimizim soon, with potential approval of the candidate expected by the end of 2013. BioMarin also plans to submit the EU application for the candidate in the second quarter this year.

The company also plans to initiate two more late stage studies this year for PEG-PAL (PKU) and BMN-673 (solid tumors). Apart from these, BioMarin has several data readouts and trial initiations throughout the year.

2013 Outlook

Apart from announcing financial results for the fourth quarter and full year 2012, the company also provided its outlook for 2013. BioMarin expects total revenues in the range of $530–$555 million. The Zacks Consensus Estimate of $554 million is on the higher end of the company’s guidance.

The company expects total Naglazyme revenues in the range of $265–$285 million and Kuvan net product sales in the range of $155–$170 million in 2013.

Meanwhile SG&A expenses are expected in the range of $220–$250 million and R&D expenditure are expected to be $340–$380 million in 2013.

Our Take

The company’s fourth quarter financial results were disappointing. We are, however, impressed with the company’s pipeline. Late stage candidate Vimizim can drive growth at BioMarin. The company can swing to profitability on the back of Vimizim. We expect investor focus to stay on the candidate’s regulatory progress.

BioMarin currently carries a Zacks Rank #3 (Hold). However, other bio pharma stocks such as Alkermes plc (ALKS - Analyst Report) and Cytokinetics Incorporated (CYTK - Snapshot Report) carry a Zacks Rank #1 (Strong Buy).

Please login to Zacks.com or register to post a comment.