Biogen Idec (BIIB) reported third quarter 2014 earnings per share of $3.79 (including the impact of stock-based compensation expense), way above the Zacks Consensus Estimate of $3.22 and the year-ago earnings of $2.34 per share.
Third quarter 2014 revenues increased 37% to $2.5 billion, topping the Zacks Consensus Estimate of $2.4 billion.
Including one-time items, third quarter 2014 earnings increased 77% to $3.62 per share.
The Quarter in Detail
Third quarter Tysabri revenues increased 25% to $501 million (U.S. – $275 million, ex-U.S. – $226 million) from the year-ago period. Biogen is booking 100% of Tysabri revenues following its acquisition of Elan’s rights in Tysabri.
Combined interferon revenues (Avonex and newly launched Plegridy), in the third quarter were $745 million (U.S. – $482 million, ex-U.S. – $263 million). Avonex revenues increased 1.1% to $741.8 million. Plegridy contributed $3.4 million to third quarter revenues.
Rituxan and Gazyva related revenues were $291 million in the third quarter.
Oral multiple sclerosis (MS) drug, Tecfidera, continues to perform well with sales coming in at $787 million – this included U.S. sales of $638 million and EU sales of $149 million.
Alprolix and Eloctate, Biogen’s recently launched hemophilia treatments, recorded revenues of $25 million and $22 million, respectively.
Ups View Again
Biogen upped its earnings guidance for 2014 yet again. The company now expects earnings in the range of $13.45 – $13.55 per share on revenue growth of 38% – 41%. Earlier, Biogen had guided towards earnings of $12.90 – $13.10 per share on revenue growth of 38% – 41%. The Zacks Consensus Estimate of $12.66 per share is below the company’s guidance range. The Zacks Consensus Estimate for revenue growth is within the guidance range at 39.4%.
The significantly higher guidance reflects the continued strong performance of Tecfidera and updated expectations.
The company continues to expect R&D spend in the range of 20% – 21% of total revenues. SG&A guidance also remains unchanged at 22% – 23% of total revenues.
Our Take
Biogen's third quarter earnings were way above expectations. Tecfidera continues to perform well in the U.S. and EU where it was launched recently. Biogen, which launched several new products in the last few months, remains poised for strong growth.
Biogen is a Zacks Rank #3 (Hold) stock. Some better-ranked stocks in the biotech sector include Medivation Inc. (MDVN), Halozyme Therapeutics, Inc. (HALO) and Ligand Pharmaceuticals Incorporated (LGND). All three are Zacks Rank #1 (Strong Buy) stocks.
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