Yahoo Finance Biotech Stock Roundup: BIIB, BMY's Q1 Earnings, INCY's Acquisition & Updates from VRTX
It was a busy week in the biotech sector with earnings reports from bigwigs Biogen BIIB and Bristol Myers Squibb BMY. Other regulatory and acquisition updates were in focus as well.
Recap of the Week’s Most Important Stories:
Biogen, BMY’s Q1 Earnings: Biogen reported first-quarter 2024 adjusted earnings per share (EPS) of $3.67, which beat the Zacks Consensus Estimate of $3.45. Earnings rose 8% year over year, driven by savings in operating costs and margin improvements. However, revenues of $2.29 billion were down 7% year over year on both reported and constant-currency basis. The decline in revenues can be attributed to lower sales of key multiple sclerosis drugs like Tecfidera and Tysabri, as well as spinal muscular atrophy drug, Spinraza. Total revenues also missed the Zacks Consensus Estimate of $2.32 billion.
Biogen reiterated its previously issued guidance for 2024. Total revenues are expected to decline by a low to mid-single-digit percentage in 2024 from the 2023 level. Core pharmaceutical revenues, comprising product sales plus Leqembi revenues, are expected to be flat year over year in 2024. Adjusted EPS is expected to be in the range of $15.00-$16.00. The Biogen stock rose following the results, as investors cheered the earnings beat and the upbeat performance of Alzheimer’s disease drug Leqembi.
Bristol-Myers reported an adjusted loss per share of $4.40, narrower than the Zacks Consensus Estimate of a loss of $4.53 per share. In the year-ago quarter, BMY posted adjusted earnings per share of $2.05. The year-over-year deterioration was primarily due to higher acquired IPRD costs reflecting the impact of recent acquisitions and increase in operating expenses. The bottom line was also negatively impacted due to higher interest expenses resulting from new debt issuance to fund recent acquisitions.
Total revenues of $11.9 billion surpassed the Zacks Consensus Estimate of $11.4 billion. Revenues increased 5% from the year-ago period’s level, primarily driven by Eliquis, Reblozyl and Opdualag, but partially offset by a decline in sales of Opdivo and Revlimid. Total sales of the immuno-oncology drug Opdivo, approved for multiple cancer indications, went down 6% year over year to $2.1 billion. Bristol-Myers now expects 2024 adjusted earnings in the band of $0.40-$0.70, down from the earlier guidance of $7.10-$7.40 to reflect the dilutive impact of recent acquisitions and collaborations.
Incyte Announces Acquisition: Incyte INCY announced that it will acquire clinical-stage company, Escient Pharmaceuticals, which is focused on developing novel therapeutics to address a broad range of neurosensory-inflammatory disorders. Per the terms of the agreement, Incyte will acquire Escient and its assets for $750 million plus Escient’s net cash remaining at the close of the transaction, subject to customary adjustments.
The acquisition will add EP262, a first-in-class, potent, highly selective, once-daily small molecule antagonist of Mas-related G protein-coupled receptor X2 (MRGPRX2) antagonist with the potential to treat a broad range of inflammatory disorders and EP547, a first-in-class oral MRGPRX4 antagonist with the potential to treat cholestatic pruritus and other conditions with severe pruritus to INCY’s pipeline. The acquisition complements Incyte’s expanding R&D activities in inflammation and autoimmunity.
Updates From Vertex: Vertex Pharmaceuticals VRTX entered into a licensing deal with TreeFrog Therapeutics to obtain an exclusive license to the latter’s proprietary cell manufacturing technology, C-StemTM. Vertex expects to leverage this technology to optimize the production of its cell therapies for type 1 diabetes (T1D). Both companies will collaborate to scale up TreeFrog’s process to produce and amplify cells for Vertex’s T1D therapies.
Per the terms of the agreement, TreeFrog will receive a $25 million upfront payment, an equity investment from Vertex. Additionally, Vertex will be liable to make milestone payments of up to $215 million to TreeFrog related to the development of a scaled-up process for fully differentiated islet cells. TreeFrog will also be eligible to receive an additional $540 million from Vertex upon the achievement of certain clinical, regulatory and commercial milestones on up to two future products. Subject to approval and commercialization of such products, the company will also have to pay tiered single-digit royalties on the sales of the same to TreeFrog.
Vertex also announced that the FDA has granted a rolling new drug application (NDA) submission for suzetrigine (formerly known as VX-548) in moderate-to-severe acute pain. The company has already initiated the rolling submission process and is on track to complete the NDA submission in the second quarter of 2024.
VRTX currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance
The Nasdaq Biotechnology Index has gained 1.29% in the past five trading sessions and Moderna’s shares have risen 5.23% during the same time frame. Over the past six months, shares of MRNA have risen 36.47%. (See the last biotech stock roundup here: Biotech Stock Roundup: REGN, SAGE, NMRA Down on Updates, ITCI Gains on Study Success)
Image Source: Zacks Investment Research
What's Next in Biotech?
Stay tuned for more earnings and pipeline updates.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Biogen Inc. (BIIB) : Free Stock Analysis Report
Bristol Myers Squibb Company (BMY) : Free Stock Analysis Report
Vertex Pharmaceuticals Incorporated (VRTX) : Free Stock Analysis Report
Incyte Corporation (INCY) : Free Stock Analysis Report
