We are maintaining our Neutral stance on BioMarin Pharmaceutical Inc. (BMRN) with a target price of $30.00.
BioMarin develops and commercializes biopharmaceuticals for serious diseases and medical conditions. The company's product portfolio comprises four approved products and multiple pipeline candidates. The marketed products are Aldurazyme co-marketed with Sanofi Aventis (SNY), Naglazyme, Kuvan and Firdapse.
Aldurazyme was approved in the US in 2003 for the treatment of MPS-I (mucopolysaccharidosis). Naglazyme was approved by the US Food and Drug Administration (FDA) in 2005, the European Medicines Agency (EMEA) in 2006 and the Japanese regulatory body in 2008.
The drug is marketed for treating MPS-VI, a rare genetic enzyme deficiency disorder. Kuvan was approved in the US in 2007 for phenylketonuria (PKU). The drug is also approved in the EU.
Firdapse, added to BioMarin’s portfolio through the acquisition of Huxley Pharmaceuticals in October 2009, was launched in the European Union (EU) in April 2010 for treating patients suffering from Lambert Eaton Myasthenic Syndrome (LEMS) – a rare autoimmune disorder.
Naglazyme is the biggest contributor to revenues at BioMarin. Kuvan has also been performing well since launch. We believe that these two products will continue to perform well in the coming quarters, thereby driving growth at BioMarin.
Moreover, the company has a robust pipeline with multiple pipeline events lined up in the near future. The successful development and commercialization of the robust pipeline should help drive long-term growth at BioMarin.
The impending purchase of an integrated biologics manufacturing plant at Shanbally, Cork, Ireland from Pfizer Inc. (PFE) is another positive for BioMarin. The move will help BioMarin to expand its manufacturing capacity which is needed to manage its proliferating product portfolio and maturing pipeline.
However, the disappointing initial sales ramp of Firdapse concerns us. Moreover, we expect cash burn to increase since the company is investing heavily on its pipeline.
We prefer to remain on the sidelines with a Neutral view on the stock until further visibility is available on the pipeline development at BioMarin.
BIOMARIN PHARMA (BMRN): Free Stock Analysis Report
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SANOFI-AVENTIS (SNY): Free Stock Analysis Report
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