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Why Is Alexion (ALXN) Up 9.7% Since Last Earnings Report?

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It has been about a month since the last earnings report for Alexion Pharmaceuticals (ALXN - Free Report) . Shares have added about 9.7% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Alexion due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Alexion Beats on Earnings and Sales in Q4

Alexion posted fourth-quarter 2018 adjusted earnings of $2.14 per share, which increased 45% from the year-ago quarter’s $1.48. Earnings also beat the Zacks Consensus Estimate of $1.83. Strong product revenues drove the bottom line in the quarter.

Revenues rose 24% year over year to $1.128 billion and exceeded the Zacks Consensus Estimate of $1.060 billion. Revenues were driven by increased sales of Soliris, Strensiq and Kanuma. 

Revenues in Detail

Soliris (paroxysmal nocturnal hemoglobinuria [“PNH”] and atypical hemolytic uremic syndrome [aHUS]) sales were up 23% to $976.7 million in the reported quarter, driven by strong volume growth. While Strensiq (hypophosphatasia [“HPP”]) contributed $126.1 million to revenues, up 32% year over year, Kanuma (lysosomal acid lipase deficiency [LAL-D]) contributed $25.7 million (up 17%) to quarterly revenues.

Cost Summary

Adjusted research and development (R&D) expenses were $164 million, down 13% year over year.

Adjusted selling, general and administrative (SG&A) expenses were $278 million, up 13.4% year over year.

Full Year 2018 Results

The company reported adjusted earnings of $7.92, up 35% year over year. The company’s revenues were $4.131 billion, up 16% year over year.

2019 Guidance

The company expects earnings per share to be $9.10-$9.30. Alexion projects revenues of $4.63-$4.70 billion in 2019. The Zacks Consensus Estimate for earnings in 2019 is pegged at $8.78, while for sales it is $4.76 billion.

Revenues for Soliris and Ultomiris are expected in the $3.97-$4.02 billion range.

Pipeline Update

In January 2019, Alexion announced positive top-line results from a phase III study of Ultomiris in complement inhibitor naïve patients with aHUS. The study met its primary objective with 53.6% of patients demonstrating complete thrombotic microangiopathy (TMA) response.

In December 2018, the FDA approved Ultomiris for adults with PNH. Applications for approval in the European Union (EU) and Japan are currently under review.  A phase III study of Ultomiris in children and adolescents with PNH is currently underway.

Alexion plans to initiate a proof-of-concept study for Ultomiris in Amyotrophic Lateral Sclerosis (ALS) anda proof-of-concept study in Primary Progressive Multiple Sclerosis (PPMS).

Alexion has submitted applications in the United States and the EU for the approval of Soliris for the treatment of Neuromyelitis Optica Spectrum Disorder (NMOSD).

A phase I study of subcutaneous ALXN1210 co-administered with Halozyme Therapeutics, Inc.’s ENHANZE drug-delivery technology, PH20 is underway. Pending co-formulation data, this next-generation subcutaneous formulation will be called ALXN1810, and has the potential to further extend the dosing interval to once every two weeks or once per month.

During the fourth quarter of 2018, Alexion acquired Syntimmune. The acquisition added anti-FcRn antibody ALXN1830 (SYNT001) to the company's clinical pipeline. ALXN1830 is currently in phase Ib/IIa development in patients with warm autoimmune hemolytic anemia (WAIHA) and those with pemphigus vulgaris (PV) or pemphigus foliaceus (PF).

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.




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