Biogen optimistic as new products gain traction | BioPharma Dive

Even though Biogen raised earnings guidance, the company still has “some potentially concerning signals” in its base business, according to one analyst.

Biogen expects to do better this year on a key metric of financial health after a strong performance this summer from its newer products, including Leqembi, the closely watched drug for Alzheimer’s disease.

On Wednesday, the Massachusetts-based biotechnology company raised its diluted earnings per share guidance for the year. That metric, which reflects the profit made for each share of a company’s common stock, is now in the range of $16.10 to $16.60, up from a previous estimate of $15.75 to $16.25.

Biogen disclosed the raise in its latest earnings report, in which the company recorded $2.5 billion in revenue over the three-month period from July through September.

Biogen still forecasts a low single-digit percentage decline in total revenue for 2024, but noted how, in the third quarter, revenue from product launches offset declines in the company’s flagship business of multiple sclerosis therapies.

Those products include Leqembi, the postpartum depression drug Zurzuvae and the rare disease medication Skyclarys. Biogen recorded $67 million in Leqembi revenue during the third quarter. That’s 66% higher than the prior quarter and, according to RBC Capital Markets analyst Brian Abrahams, above the $58 million Wall Street had anticipated.

Skyclarys revenue, meanwhile, totaled $102 million, or about $10 million less than the average analyst estimate.

In Biogen’s core business, its multiple sclerosis drugs continued to decline. Sales from the franchise dipped 9% between last year’s third quarter and this year’s, during which it brought in just over $1 billion. Revenue from Spinraza, a treatment for an uncommon muscle disease and a former key growth driver for Biogen, also declined 15% across those two periods, to $381 million.

Biogen has undergone a major transformation since Chris Viehbacher, the former Sanofi head, took over as CEO in late 2022. Under Viehbacher, the company has moved to cut costs, turned over much of its executive team and spent billions of dollars to diversify research beyond the “high-risk, high-reward” neuroscience programs with which Biogen had become synonymous.

That shift proceeded this week, as Biogen appointed a chief medical officer and announced it will have a new chief financial officer early next year. The company also said that a previously announced cost-cutting plan remains on track to achieve $800 million in net cost savings by the end of 2025.

On the research side, Biogen highlighted four programs that it believes, collectively, could generate around $14 billion in annual sales at their peak. The programs target early Alzheimer’s, different forms of lupus, and autoimmune conditions affecting the kidneys.

Shares of Biogen dipped slightly Wednesday morning, trading down to around $180 apiece.

For analysts, the fresh earnings were a bit of a mixed bag. Because while there were bright spots, like strong sales of Leqembi outside the U.S., overall product revenue still came in around $80 million lower than analysts generally expected, according to Salim Syed of Mizuho Securities.

Biogen “remains a company in transition, with some potentially concerning signals in the base business likely to further investors' push for more external [deals],” Abrahams, of RBC, wrote in a note to clients. Jefferies analyst Michael Yee also argued Biogen needs to do more business development and further grow its pipeline to “get investors truly engaged” and shift their focus away from Alzheimer’s.