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Will Loss of REGEN-COV Sales Hurt Regeneron (REGN) in 2022?

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Biotech giant Regeneron Pharmaceuticals (REGN - Free Report) witnessed a massive surge in sales in 2021, driven by an exemplary contribution from REGEN-COV, a cocktail of two monoclonal antibodies — casirivimab and imdevimab) — for COVID-19. However, 2022 has seen a massive decline from those levels, thereby pulling down the year-over-year growth.

While sales in 2021 came in at $5.8 billion in the United States, sales in the first half of 2022 were negligible as FDA revised the authorizations for a few monoclonal antibody treatments, including Regeneron’s REGEN-COV, as data indicated that these treatments are highly unlikely to be active against the Omicron variant.  Therefore, REGEN-COV is not currently authorized for use in any U.S. states, territories or jurisdictions. Sales outside the country came in at $658.4 million in the first half of 2022.

Further, with the pandemic largely under control, sales of COVID-19 treatments will decline.

Regeneron, however, has many arms in its arsenal. Lead drug Eylea (aflibercept), approved for various ophthalmology indications, has been a steady growth driver and should maintain momentum on sustained label expansions.

The company recently announced that the two studies evaluating aflibercept 8 mg with 12- and 16-week dosing regimens in patients with diabetic macular edema (DME) and wet age-related macular degeneration (wAMD) were successful. The company is evaluating a higher dose of aflibercept with less frequent injections in the targeted population. The results impressed investors and should bode well for Eylea.

Regeneron is jointly developing aflibercept 8 mg with Bayer AG (BAYRY - Free Report) . While REGN records net product sales of Eylea in the United States, Bayer records net product sales of the drug outside the United States. Regeneron records its share of profits/losses in connection with sales of Eylea outside the United States.

However, stiff competition from the potential entry of generics and new treatment options weigh on Eylea and has been an overhang on Regeneron’s shares in recent months.

In January 2022, Roche (RHHBY - Free Report) won FDA approval for Vabysmo (faricimab-svoa) to treat wAMD and DME. Roche has designed Vabysmo to block pathways involving Ang-2 and VEGF-A. It has ongoing long-term extension studies for Vabysmo in people with nAMD and DME. The European Commission too recently approved Vabysmo (faricimab) for these indications.

Another growth driver in Regeneron’s armory is Dupixent, for which it has a collaboration with Sanofi (SNY - Free Report) . Solid sales of Dupixent (approved for use in certain patients with atopic dermatitis, asthma, chronic rhinosinusitis with nasal polyposis, eosinophilic esophagitis) have boosted the top line significantly. Sanofi records global net product sales of Dupixent, while REGN records its share of profits/losses in connection with global sales of the drug.

Regeneron is also looking to make a place in the lucrative oncology space with Libtayo, indicated in certain patients with advanced basal cell carcinoma (BCC), advanced cutaneous squamous cell carcinoma (CSCC) and advanced non-small cell lung cancer (NSCLC). While Libtayo holds promise, competition is stiff in this oncology space with many formidable drugs. Hence, Libtayo has a long way to go before contributing significantly to the top line.

Regeneron is also looking to foray into the challenging but promising nonalcoholic steatohepatitis (NASH) space with Alnylam Pharmaceuticals, Inc. and CRISPR/Cas9 genome editing therapy with Intellia Therapeutics, Inc.



 

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