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Regeneron Q4 profit soars 371%, beats estimates

Regeneron Pharmaceuticals Inc. (REGN) reported a 371% jump in earnings for the fourth quarter helped by higher product sales and an income tax benefit as well as management of costs and expenses. The results exceeded analysts’ expectations. The company issued expenses guidance for the full year 2019.

Net income soared 371% to $820 million and earnings surged 377% to $7.15 per share. Non-GAAP earnings climbed 31% to $6.84 per share.

Total revenues grew 22% to $1.93 billion versus the prior-year quarter. Net product sales grew to $1.1 billion from $979 million last year, helped by higher sales from Eylea injection that administered into the eye to treat certain retinal diseases. Libtayo, which was approved by the FDA to treat a type of skin cancer, had net product sales in the United States of $15 million in the fourth quarter of 2018.

Regeneron fourth quarter 2018 earnings snapshot
Regeneron Q4 2018 Earnings Infographic

Revenues from Sanofi and Bayer collaboration jumped 47% year-over-year. The increase in Sanofi collaboration was due to a rise in clinical development activities for Libtayo, its share of higher net sales of Dupixent, Praluent and Kevzara, and adjustment recognition from the change in estimate of the stage of completion of the collaborations’ immuno-oncology programs.

The change in Bayer collaboration revenue was due to a rise in net profits in connection with higher sales of Eylea outside the US. Also, in the fourth quarter of 2017, the company accelerated the recognition of deferred revenue from the up-front payment previously received from Bayer in connection with the discontinuation of the Ang2 development program.

For the fourth quarter, R&D expenses increased by 13.8% on an increase in Libtayo development expenses, higher payroll and payroll-related costs, and higher facilities-related costs, partly offset by a decrease in Dupixent development expenses.

Looking ahead into the full year 2019, the company expects unreimbursed R&D expenses of $1.855 billion to $2 billion and selling, general and administrative expenses of $1.7 billion to $1.83 billion. Capital expenditures are anticipated to be $410 million to $490 million. The effective tax rate is predicted to be 14% to 16%.

Shares of Regeneron opened higher but changed course to the red territory in the early trade on Wednesday. The stock has risen over 24% in the past year and over 16% in the past three months.

 

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