* Sees full-year Eylea sales of $700 mln-$750 mln
* CEO cites market share gains at expense of Roche drugs
* Shares up 5.3 percent (Adds analyst comment, background, updates shares)
By Bill Berkrot
July 25 (Reuters) - Regeneron Pharmaceuticals Inc significantly boosted its 2012 sales forecast for its new eye drug Eylea for the third time this year as second-quarter sales of the sight-restoring medicine cruised past Wall Street's rising expectations.
The biotechnology company said on Wednesday that it expected full-year U .S. E ylea sales of $700 million to $750 million. In April, it had forecast Eylea sales of $500 million to $550 million, nearly double its previous projection.
Shares in Regeneron surged as much as 11.5 percent in early trading on Wednesday, b ut gave back mu ch o f those gains a nd were up 5. 3 per cent in afternoon trading.
BMO Capital Markets analyst Jim Birchenough called the second quarter results "phenomenal" and said the muted stock response was likely due to concerns over potentially slowing Eylea growth in the second half of the year as initial patients move from monthly dosing in the first three months of treatment to less frequent injections.
"We would advise looking past that to all the growth drivers beyond the second half of this year," said Birchenough, who raised his rating on Regeneron stock to "buy" from "market perform" and his price target to $158 from $143. "Once we get to a steady state of dosing frequency, we think there is a lot of room for market share gains, a lot of room for geographic expansion and a lot of room for label expansion."
J.P. Morgan analyst Geoff Meacham, in a research note, said questions remain regarding the durability of Eylea growth given the potential for competition on the intermediate-term horizon.
Privately-held biotechnology company Ophthotech last month released promising data from a mid-stage clinical trial of an eye drug that could become a strong future rival to Eylea.
Second-quarter sales of the Eylea, which since its November approval has been gaining market share from Roche Holding AG's Lucentis and off-label use of the cancer drug Avastin, were $194 million, up 57 percent from the previous quarter.
On Tuesday, Robert W. Baird analysts raised their Eylea sales forecast for the quarter to $155 million, ahead of Wall Street consensus expectations of about $143 million, and even that proved to be not aggressive enough.
"If we hit our new forecast we will be one of the best launches in the history of the biotechnology industry," Chief Executive Leonard Schleifer said in a telephone interview.
"We got a very good label for the product that clearly stated what we think are its advantages to patients, and doctors tried the product and I think were very pleased," he said of the early success.
FEWER INJECTIONS, LOWER COST
Eylea treats wet age-related macular degeneration (AMD) -- the leading cause of blindness in the elderly. Like its Roche rivals, it has shown an ability to restore some lost vision, but offers the advantage of roughly half as many injections in the eye as well as a lower cost than Lucentis.
"We're taking market share based on new patients, based on people switching from Lucentis and based on people switching from Avastin," said Schleifer, who estimated that Eylea currently has about 14 percent of the AMD market, giving it plenty of room to grow.
"There's an opportunity to grow this product in the United States, based on increasing the market share as well as hopefully getting new indications," the CEO said. "There's also the possibility to grow product revenues for us based on geographic expansion."
Regeneron owns full U.S. rights to Eylea and will get about half the profits from any overseas sales from marketing partner Bayer Ag.
Regeneron posted second-quarter net profit of $76.7 million, or 70 cents per share, marking its second profitable quarter. The company posted a loss of $62.5 million, or 69 cents per share, in the year-ago quarter.
Revenue of $304 million for the quarter easily beat Wall Street expectations of $257 million, according to Thomson Reuters I/B/E/S.
Regeneron shares were up $6.46 or 5.3 percent, at $12 7.90 in afternoon trading on Nasdaq.
The company is not expected to depend solely on Eylea for long as Regeneron has several other promising products in development for a variety of disease categories.
"We have a robust pipeline of about a dozen different things in clinical development at all stages," Schleifer said. "The best we hope may be yet to come." (Reporting by Bill Berkrot in New York; Editing by Lisa Von Ahn, Jeffrey Benkoe, Sofina Mirza-Reid and Carol Bishopric)