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Regeneron (REGN) Stock Up 3.5% YTD: What's in Store for 2H21?

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Shares of bigwig Regeneron Pharmaceuticals, Inc. (REGN - Free Report) have grown 3.5% so far this year against the industry’s decline of 4.1%.

Zacks Investment ResearchImage Source: Zacks Investment Research

 

Regeneron has had a good run in 2021 so far after putting up a stellar performance in 2020 on the back of a solid product portfolio. The company’s efforts to expand the label of its approved drugs and concurrently develop the pipeline are impressive. Last month, it reported solid results for the first quarter of 2021 on broad-based portfolio growth.

Demand for ophthalmology drug, Eylea, revived after a slowdown last year.

Asthma drug, Dupixent, developed in partnership with Sanofi (SNY - Free Report) , has posted a strong performance in the last few quarters and maintains momentum. Sales are expected to get a boost on continued label expansions of the drug. 

Immunotherapy drug, Libtayo, is off to a good start. In February 2021, the FDA approved the drug for the first-line treatment of patients with advanced non-small cell lung cancer (NSCLC) and metastatic or locally advanced basal cell carcinoma (BCC). Sales are expected to get a boost from these recent approvals.

Meanwhile, incremental contribution from REGEN-COV, its antibody cocktail for COVID-19, has boosted the top line in the last couple of quarters and should propel sales as the pandemic continues. We remind investors that the antibody cocktail was granted an Emergency Use Authorization (EUA) by the FDA for the treatment of mild-to-moderate COVID-19 in adults and pediatric patients aged at least 12 years and weighing at least 40 kg.

Despite stiff competition from Eli Lilly’s (LLY - Free Report) cocktail therapy, demand for Regeneron’s antibody cocktail remains strong and sales should increase further as the pandemic refuses to lose steam, particularly in the developing countries, and the rollout of the vaccines will take time.  Regeneron has a collaboration agreement with Roche (RHHBY - Free Report) for REGEN-COV.

The phase III treatment study in high-risk COVID-19 outpatients met its primary endpoint, showing that REGEN-COV significantly reduced the risk of hospitalization or death by approximately 70% with both REGEN-COV doses (1,200 mg and 2,400 mg) compared to placebo. The trial also met key secondary endpoints. Based on these results, Regeneron submitted a request to the FDA to update the EUA to the lower 1,200 mg dose.

The FDA also approved Evkeeza for the treatment of adults and adolescents with homozygous familial hypercholesterolemia (HoFH). Approval of new drugs brings in an additional stream of revenues for Regeneron.

While competition and slowdown for Eylea are concerns, Regeneron is expected to maintain momentum on its diversified portfolio and a promising late-stage pipeline.

Regeneron currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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