Regeneron Misses Q1 Earnings Due to Lower Eylea Sales

Regeneron Pharmaceuticals reported its financial results for the first quarter of 2024, revealing numbers that fell short of Wall Street's predictions for both earnings and revenue. Analysts had anticipated earnings of $10.18 per share and revenues of $3.23 billion for the quarter. However, the company's adjusted earnings were $9.55 per share, with sales totaling $3.15 billion.

One significant factor in the underperformance was the softer-than-expected sales of Regeneron's eye drug, Eylea, which was developed in collaboration with Bayer. The company attributed this shortfall to a $40 million reduction in inventory and shifts in market conditions. Eylea generated $1.4 billion in sales during the first quarter, marking a 2% decline from the $1.43 billion reported in the same period of 2023. This figure also fell considerably below Wall Street's forecast of $1.86 billion. A newly introduced higher dose (HD) version of Eylea contributed $200 million to overall sales, and analysts predict that Eylea HD will capture more market share over the coming year.

Despite the challenges, Regeneron has managed to extend Eylea’s market exclusivity until June 2027 through a court ruling, even though biosimilars were expected to enter the market this year. However, Roche's eye drug Vabysmo, which received FDA approval in 2022, has been gaining market share and reported $927 million in sales in the first quarter of 2024.

Regeneron also saw less-than-expected results for its asthma drug Dupixent, developed in partnership with Sanofi. The drug’s sales reached $3.08 billion, falling short of the $3.19 billion anticipated by analysts. Nonetheless, this still represented a robust 24% growth compared to the same period in the previous year.

The company's oncology portfolio showed positive progress, particularly with its skin cancer drug Libtayo. Global sales of Libtayo rose by 49% to $264 million in the first quarter, up from $177 million in the same quarter last year. Additionally, Regeneron's cholesterol treatment Praluent experienced a notable 75% increase in sales, reaching $70 million.

Overall, Regeneron’s total net product sales amounted to $1.76 billion for the quarter, a 6% increase compared to the $1.67 billion reported in the first quarter of 2023.

In a bid to enhance shareholder value, Regeneron's board has sanctioned a $3 billion share buyback program, which adds to the $1.2 billion buyback initiative announced in March 2024. CFO Christopher Fenimore stated that this repurchase program will offer the company "additional flexibility to continue returning capital to shareholders over time."