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Will Biogen (BIIB) Succeed in Beating Q1 Earnings Estimates?
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We expect Biogen (BIIB - Free Report) to beat expectations when it reports first-quarter 2022 results on May 3, before market open. In the last reported quarter, the company delivered an earnings surprise of 2.11%.
The company’s earnings beat estimates in each of the last four quarters. The company has a four-quarter earnings surprise of 11.72%, on average.
Biogen’s stock has declined 13.8% this year so far compared with a decrease of 17.1% for the industry
Image Source: Zacks Investment Research
Factors to Consider
Biogen’s sales in the first quarter are likely to have been hurt by lower sales of Tecfidera and Spinraza.
Biogen’s multiple sclerosis revenues have been declining since the past few quarters. It is unlikely that MS sales 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. Tecfidera generics are also expected to be launched in Europe in the first half of 2022. It remains to be seen if generics were launched in Europe and hurt sales from the drug.
Sales of another MS drug, Tysabri may have benefited from volume increases and patient growth, despite increased competitive pressure and price reductions in certain European markets.
The Zacks Consensus Estimate for sales of Tecfidera in the first quarter is pegged at $403 million while that for Tysabri is $495 million.
Sales volumes of new MS drug Vumerity are likely to have increased compared with the year-ago quarter, continuing the trend observed in the past three quarters of 2021. The Zacks Consensus Estimate for Vumerity is $127 million.
Biogen receives royalties on U.S. sales of Roche’s (RHHBY - Free Report) MS drug, Ocrevus, which is also expected to have contributed to the top line. The Zacks Consensus Estimate for Ocrevus royalties is $238 million.
Roche’s Ocrevus (ocrelizumab) was approved for the treatment of relapsing MS (RMS) and primary progressive MS (PPMS) in March 2017
Revenues from Biogen’s share of Roche’s drugs, Rituxan and Gazyva are also likely to have declined in the quarter due to biosimilar competition and the impacts of COVID-19.
The negative impact of COVID-19 and increased competition in the United States are likely to have hurt sales of Biogen’s spinal muscular atrophy drug, Spinraza, in the United States. Outside the United States, sales of Spinraza might have been hurt due to competition and pricing pressure in Europe. The Zacks Consensus Estimate for sales of Spinraza is $408 million.
Sales of the new Alzheimer’s drug, Aduhelm, are likely to have been minimal as patient access is limited.
Earlier this month, the Centers for Medicare & Medicaid Services (“CMS”) released its final National Coverage Determination (NCD) decision for the class of anti-amyloid antibodies approved by the FDA like Aduhelm. Per the final NCD decision, Medicare said it would cover FDA-approved drugs like Aduhelm only for patients enrolled in CMS-approved studies. This means Medicare will not cover Aduhelm for patients treated outside of clinical studies.
With the CMS now abiding by the draft decision released in January, it will restrict patient access to Aduhelm and limit its commercial potential.
In Europe too, Biogen announced last week that it had withdrawn its marketing authorization application (MAA) for aducanumab. The decision to withdraw the MAA was based on a suggestion by the EMA’s Committee for Medicinal Products for Human Use (CHMP) that the data provided thus far would not be sufficient for a positive opinion from the agency to support marketing approval of the candidate.
Management is likely to face questions on these setbacks related to Aduhelm on the first-quarter conference call.
Biosimilars revenues may have benefited from volume increase, which is likely to have been offset by pricing pressure. The Zacks Consensus Estimate for sales of biosimilars is $213 million.
The reduction in revenues from Tecfidera and Rituxan, both high-margin products, is expected to have lowered Biogen’s gross margin in the first quarter.
Earnings Whispers
Our proven model predicts an earnings beat for Biogen in the to-be-reported quarter. 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. This is the case here, as elaborated below.
Earnings ESP: Biogen’s Earnings ESP is +1.57% as the Most Accurate Estimate of $4.43 is higher than the Zacks Consensus Estimate of $4.36. 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 large drug/biotech stocks that also have the right combination of elements to beat on earnings this time around:
AbbVie’s stock has surged 17.6% this year so far. AbbVie topped earnings estimates in three of the last four quarters. AbbVie has a four-quarter earnings surprise of 2.55%, on average. ABBV is scheduled to release its first-quarter 2022 results on Apr 29.
Moderna (MRNA - Free Report) with an Earnings ESP of +3.89% and a Zacks Rank #3.
Moderna topped earnings estimates in three of the last four quarters. Moderna has a four-quarter earnings surprise of 11.88%, on average. The stock has declined 42.6% this year so far.
Image: Shutterstock
Will Biogen (BIIB) Succeed in Beating Q1 Earnings Estimates?
We expect Biogen (BIIB - Free Report) to beat expectations when it reports first-quarter 2022 results on May 3, before market open. In the last reported quarter, the company delivered an earnings surprise of 2.11%.
The company’s earnings beat estimates in each of the last four quarters. The company has a four-quarter earnings surprise of 11.72%, on average.
Biogen Inc. Price and EPS Surprise
Biogen Inc. price-eps-surprise | Biogen Inc. Quote
Biogen’s stock has declined 13.8% this year so far compared with a decrease of 17.1% for the industry
Image Source: Zacks Investment Research
Factors to Consider
Biogen’s sales in the first quarter are likely to have been hurt by lower sales of Tecfidera and Spinraza.
Biogen’s multiple sclerosis revenues have been declining since the past few quarters. It is unlikely that MS sales 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. Tecfidera generics are also expected to be launched in Europe in the first half of 2022. It remains to be seen if generics were launched in Europe and hurt sales from the drug.
Sales of another MS drug, Tysabri may have benefited from volume increases and patient growth, despite increased competitive pressure and price reductions in certain European markets.
The Zacks Consensus Estimate for sales of Tecfidera in the first quarter is pegged at $403 million while that for Tysabri is $495 million.
Sales volumes of new MS drug Vumerity are likely to have increased compared with the year-ago quarter, continuing the trend observed in the past three quarters of 2021. The Zacks Consensus Estimate for Vumerity is $127 million.
Biogen receives royalties on U.S. sales of Roche’s (RHHBY - Free Report) MS drug, Ocrevus, which is also expected to have contributed to the top line. The Zacks Consensus Estimate for Ocrevus royalties is $238 million.
Roche’s Ocrevus (ocrelizumab) was approved for the treatment of relapsing MS (RMS) and primary progressive MS (PPMS) in March 2017
Revenues from Biogen’s share of Roche’s drugs, Rituxan and Gazyva are also likely to have declined in the quarter due to biosimilar competition and the impacts of COVID-19.
The negative impact of COVID-19 and increased competition in the United States are likely to have hurt sales of Biogen’s spinal muscular atrophy drug, Spinraza, in the United States. Outside the United States, sales of Spinraza might have been hurt due to competition and pricing pressure in Europe. The Zacks Consensus Estimate for sales of Spinraza is $408 million.
Sales of the new Alzheimer’s drug, Aduhelm, are likely to have been minimal as patient access is limited.
Earlier this month, the Centers for Medicare & Medicaid Services (“CMS”) released its final National Coverage Determination (NCD) decision for the class of anti-amyloid antibodies approved by the FDA like Aduhelm. Per the final NCD decision, Medicare said it would cover FDA-approved drugs like Aduhelm only for patients enrolled in CMS-approved studies. This means Medicare will not cover Aduhelm for patients treated outside of clinical studies.
With the CMS now abiding by the draft decision released in January, it will restrict patient access to Aduhelm and limit its commercial potential.
In Europe too, Biogen announced last week that it had withdrawn its marketing authorization application (MAA) for aducanumab. The decision to withdraw the MAA was based on a suggestion by the EMA’s Committee for Medicinal Products for Human Use (CHMP) that the data provided thus far would not be sufficient for a positive opinion from the agency to support marketing approval of the candidate.
Management is likely to face questions on these setbacks related to Aduhelm on the first-quarter conference call.
Biosimilars revenues may have benefited from volume increase, which is likely to have been offset by pricing pressure. The Zacks Consensus Estimate for sales of biosimilars is $213 million.
The reduction in revenues from Tecfidera and Rituxan, both high-margin products, is expected to have lowered Biogen’s gross margin in the first quarter.
Earnings Whispers
Our proven model predicts an earnings beat for Biogen in the to-be-reported quarter. 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. This is the case here, as elaborated below.
Earnings ESP: Biogen’s Earnings ESP is +1.57% as the Most Accurate Estimate of $4.43 is higher than the Zacks Consensus Estimate of $4.36. 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 large drug/biotech stocks that also have the right combination of elements to beat on earnings this time around:
AbbVie (ABBV - Free Report) with an Earnings ESP of +0.18% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
AbbVie’s stock has surged 17.6% this year so far. AbbVie topped earnings estimates in three of the last four quarters. AbbVie has a four-quarter earnings surprise of 2.55%, on average. ABBV is scheduled to release its first-quarter 2022 results on Apr 29.
Moderna (MRNA - Free Report) with an Earnings ESP of +3.89% and a Zacks Rank #3.
Moderna topped earnings estimates in three of the last four quarters. Moderna has a four-quarter earnings surprise of 11.88%, on average. The stock has declined 42.6% this year so far.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.