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Biogen (BIIB) to Report Q1 Earnings: Will It Beat Estimates?

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We expect Biogen, Inc. (BIIB - Free Report) to beat expectations when it reports first-quarter 2021 results on Apr 22, before market open. In the last reported quarter, the company delivered a negative earnings surprise of 7.10%.

The company’s earnings beat estimates in three of the last four quarters while missing in one. The company has a four-quarter earnings surprise of 12.11%, on average.

Biogen Inc. Price and EPS Surprise

Biogen Inc. Price and EPS Surprise

Biogen Inc. price-eps-surprise | Biogen Inc. Quote

Biogen’s stock has risen 10.4% this year so far against a decrease of 2.4% for the industry

Factors to Consider

Biogen’s MS revenues, excluding Ocrevus royalties, declined over year in the past two quarters. MS sales are unlikely to have improved in the first quarter.

Among Biogen’s MS drugs, sales of Tecfidera are likely to have declined steeply hurt by the launch of multiple generics products in the United States.

Sales of another MS drug, Tysabri may have benefitted from patient growth. However, the impact of COVID-19 infections on Tysabri sales remains to be seen when the company reports.

The Zacks Consensus Estimate for sales of Tecfidera in the first quarter is pegged at $467 million while that for Tysabri is $473 million.

Sales of new MS drug Vumerity are likely to have been hurt by lower new patient starts and switches due to COVID-19 and reduced physician interaction. However, in the second half of 2020, the company saw improvement in new patient starts. It remains to be seen if the positive trend continued in the first quarter when the company reports. The Zacks Consensus Estimate for sales of Vumerity is $44.2 million.

Biogen receives royalties on U.S. sales of Roche’s (RHHBY - Free Report) MS drug, Ocrevus, which is also likely to have contributed to the top line. The Zacks Consensus Estimate for Ocrevus royalties is $208 million.

Meanwhile, the negative impact of COVID-19 as well as increased competition in the United States is likely to have hurt Spinraza’s sales in the United States. Outside the United States, sales of Spinraza might have increased though lower prices in some international markets might have hurt sales. The Zacks Consensus Estimate for sales of Spinraza is $484 million.

Biosimilars revenues improved sequentially in the fourth quarter. However, sales continued to be impacted by slowdown in new treatments and reduced clinic capacity for immunology patients as a result of COVID-19. It remains to be seen if sales recovered in the first quarter. The Zacks Consensus Estimate for sales of biosimilars is $215 million.

Key Development in Q1

In January, the FDA extended the review period of biologics license application (BLA) filing for Biogen’s controversial Alzheimer’s drug aducanumab by three months and will now give its decision on Jun 7, delayed from the prior expectation of March 2020.

Biogen submitted a response to an information request by the FDA, including additional analyses and clinical data as part of the ongoing review. The agency considered this a major amendment to the application that will require additional time for review. In November 2020, an FDA advisory committee voted against approving aducanumab. The FDA, in its decision, is not bound by the advisory’s committee’s opinion but will definitely take into account the panel’s recommendation, especially while considering such a negative opinion.

Earnings Whispers

Our proven model predicts an earnings beat for Biogen in the soon-to-be-reported quarter because it has the right combination of the two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for a likely positive surprise.

Earnings ESP: Biogen’s Earnings ESP is +2.70% as the Most Accurate Estimate of $5.21 is pegged higher than the Zacks Consensus Estimate of $5.07. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Biogen has a Zacks Rank #3.

Other Stocks to Consider

Here are some other large drug/biotech stocks that have the right combination of elements to beat on earnings this time around:

AstraZeneca (AZN - Free Report) with an Earnings ESP of +13.08% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Gilead Sciences (GILD - Free Report) has an Earnings ESP of +3.54% and a Zacks Rank #3.

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Gilead Sciences, Inc. (GILD) - free report >>