Biogen (BIIB), a multinational biotechnology company based in Cambridge, Massachusetts, posted better-than-expected second-quarter financial results despite a significant decline in earnings. The company’s fully approved Alzheimer’s drug, Leqembi, is not yet profitable but played a crucial role in driving the positive outcomes. Biogen’s stock also showed signs of improvement during premarket trade.
Q2 Financial Results
Biogen reported a 23% decrease in profits, with earnings per share reaching $4.02, while revenue dropped 5% to $2.45 billion. These figures surpassed Wall Street’s predictions, which anticipated a 28% fall in earnings to $3.77 per share and a 9% decrease in revenue to $2.36 billion. The company’s stock gained 1.5% during premarket trade, building on the previous day’s fractional increase, bringing the closing price to $277. According to STA Research analysis, Biogen stock has formed a flat base with a 319.76 buy point on the weekly chart.
Leqembi’s Impact
The focus of attention during the quarter was Biogen’s Alzheimer’s drug, Leqembi, which received full approval from the Food and Drug Administration on July 6. The traditional approval enables the Centers for Medicare and Medicaid Services to reimburse patients for the cost of the treatment, which is priced at $26,500 annually without insurance. However, the drug’s launch faced challenges as the quarter saw a loss of $20.7 million from its collaboration with Eisai, the drug’s partner. For the first half of 2023, Leqembi resulted in a loss of $39.6 million. Biogen executives indicated that they expect Leqembi to remain unprofitable in 2023 as the drug’s launch continues.
CEO Chris Viehbacher expressed enthusiasm about the full approval, calling it a “historic moment” and stating that the drug’s launch in the U.S. is underway. However, uncertainties remain, and Viehbacher acknowledged that much of the drug’s future performance is unpredictable.
Biogen Stock Analysis & Forecast
According to the analysis of 17 analysts, Biogen Inc. is projected to have an average target price of USD 333.09 in the next 12 months, making it a Strong Buy according to the average analyst rating. Stock Target Advisor’s own analysis of Biogen Inc. shows a Slightly Bullish outlook, considering 9 positive signals and 6 negative signals. As of the last closing, Biogen Inc. stock price stood at USD 277.00. Over the past week, the stock price has experienced a minor decrease of -0.50%, while over the past month, it declined by -2.64%. However, over the course of the last year, the stock has shown significant growth, with a remarkable increase of +34.30%.
Outlook and Previous Results
Biogen reaffirmed its full-year outlook, anticipating a mid-single-digit percentage decline in revenue compared to 2022 and earnings in the range of $15 to $16 per share.
In the first quarter, Biogen’s earnings per share reached $3.40 (excluding certain items) on $2.46 billion in sales, exceeding expectations by 12 cents per share. The company’s earnings fell by 3%, while sales dropped 6%. Analysts had anticipated lower sales, with estimates around $2.34 billion.
The company’s multiple sclerosis portfolio continued to decline, with a 15% decrease in revenue to $1.21 billion, including sales from Tecfidera, Vumerity, Plegridy, Tysabri, and Fampyratm. Sales of Tysabri missed forecasts, reaching $473 million, while Tecfidera beat expectations with $274 million in revenue.
