Investors may want to mark their calendars for Dec. 11. That’s when Regeneron Pharmaceuticals Inc.'s (REGN, Financial) shares could be driven up even further when the company updates its developing hematology portfolio at the American Society of Hematology meeting in Atlanta. One of the drugs that will be reviewed is REGN5458, an experimental treatment the company thinks may be a major advance in treating patients who have failed several prior lines of therapy.
Regeneron has enjoyed a wealth of riches lately. The company’s third-quarter results far exceeded expectations, trouncing estimates for both sales and earnings thanks to higher demand for its two biggest sellers, Eylea and Dupixent.
Regeneron’s third-quarter earnings were $15.37 per share, far outpacing the Zacks consensus estimate of $9.81. Earnings jumped 84% from the year-ago quarter due to higher sales. Revenue of $3.4 billion blew well past the Zacks estimate of $2.7 billion and were more than 50% over the same period a year earlier.
A welcome surprise of sorts was the contribution of the company’s antibody cocktail for Covid-19. Sales of REGEN-COV, which is available in the U.S. under emergency authorization by the Food and Drug Administration, were just short of $680 million.
Demand for the drug combination was up sharply in the third quarter due to growing use of the treatment in the fight against Covid. The drug is “ increasingly seen as standard of care for outpatient treatment and post-exposure prophylaxis in appropriate patients,” Marion McCourt, executive vice president of Commercial, told analysts on the company’s earnings call.
Even though Covid cases have declined recently, McCourt said REGEN-COV has a broad use in cases involving pre-exposure prevention to hospitalization. The company expects the FDA to rule on its application for full approval in April 2022.
In September, a phase 3 study in patients hospitalized with Covid met its primary goal, showing REGEN-COV significantly cut the viral load. The FDA is currently reviewing the company's request to expand the Emergency Use Authorization (EUA) to include treatment in hospital settings.
Regeneron expects further growth for its multibillion-dollar sellers Eylea and Dupixent as the drugs increase their market penetration. The company is hardly resting on its laurels, though. President and CEO Dr. Len Schleifer emphasized to analysts that the company’s extensive pipeline now includes more than 30 clinical-stage drug candidates, with many more on the way. Most of the company’s prospects have been developed in-house, supplemented by relationships that bring in novel technologies.
Regeneron shares are up nearly 25% this year to about $622. Yahoo Finance says the company is undervalued. Of the 25 analysts providing recommendations, 13 rate the stock a buy or strong buy. They assign the shares an average target price of $700, a high of $850 and a low of $565.
