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UPDATE 3-Regeneron boosts Eylea sales forecast - again
July 25, 2012 / 11:13 AM / 5 years ago

UPDATE 3-Regeneron boosts Eylea sales forecast - again

 * 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)
 

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