Biogen Surprise Boost From Alzheimer's Drug Wasn't Enough

Biogen (BIIB) stock dipped Wednesday despite an unexpected boost from its new Alzheimer's drug, Leqembi, and an earnings guidance hike.

Leqembi sales, recorded by partner Eisai (ESAIY), came in at $67 million. That topped forecasts ranging from $54 million to $58 million, according to analysts' reports. U.S. sales fell short at $39 million, though. Analysts projected $42 million to $43 million, RBC Capital Markets analyst Brian Abrahams said in a client note.

And, less promisingly, "across the rest of the business, results were less robust," he said. Revenue from Friedreich's ataxia treatment Skyclarys lagged. Spinal muscular atrophy drug Spinraza also generated lower-than-expected sales in the September quarter. And Biogen's multiple sclerosis drugs franchise was "also generally soft."

"In our view, Biogen remains a company in transition, with some potentially concerning signals in the base business likely to further investors' push for more external business development," he said. "Though favorable traction for Leqembi in ex-U.S. markets (is) likely not given much previous credit from the Street."

In early trading on today's stock market, Biogen stock fell more than 1% to 180.83. Shares are down 29.1% in 2024 as of the close on Tuesday.

Biogen Stock: Sales And Earnings Decline

Overall, Biogen earned $4.08 per share, minus some items, on $2.47 billion in September-quarter sales. Earnings declined 6% while sales fell 3%. Earnings beat forecasts for $3.77 a share, and sales topped the $2.44 billion estimate from analysts polled by FactSet.

Revenue from Biogen's biggest business, multiple sclerosis drugs, tumbled 9% to $1.05 billion. Piper Sandler analyst Christopher Raymond noted two key misses from Tecfidera and Vumerity. Combined, the pair of MS drugs generated $391 million, but missed the Street's projection for $402 million.

Meanwhile, revenue from Spinraza skidded 15% to $381.4 million, below expectations for $438 million, according to FactSet. RBC's Abrahams said this was somewhat expected "given some one-time second-quarter benefits."

"We believe the Street had been mismodeling the run-rate," he said.

Skyclarys sales also missed at $102.3 million. Analysts projected $110.9 million.

But Abrahams kept his outperform rating on Biogen stock, noting the company was able to raise its outlook for the year. Biogen now expects to earn $16.10 to $16.60 a share. It's important to note the midpoint at $16.35 is well below analysts' call for $16.17.

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