Biogen Raises 2013 Forecast After First-Quarter Profit Surges

Biogen Idec Inc. (BIIB), the fourth- largest U.S. biotechnology company by market value, raised its full-year forecast after first-quarter net income increased on a tax benefit.

Full-year earnings excluding one-time items will be $7.80 to $7.90 a share, the Weston, Massachusetts-based company said today in a statement. Analysts had anticipated $7.86, according to the average of 29 estimates compiled by Bloomberg.

First-quarter earnings excluding items were $1.97 a share, beating the average analysts’ estimate by 34 cents, as a manufacturing tax credit of $33 million helped boost the results by 17 cents. Revenue rose 9.5 percent to $1.42 billion, led by higher sales of the drugs Avonex and Tysabri, both for multiple sclerosis.

“All major product lines were roughly in-line globally and EPS was inflated by a one-time 17 cent tax benefit” and by a deal Biogen made to gain full control of Tysabri from partner Elan Corp., Mark Schoenebaum, an analyst with ISI Group, wrote in a note to clients today. “Biogen just reported a good quarter, but the headline ‘beat’ is a bit misleading.”

Biogen won U.S. approval for Tecfidera, its first pill for the central nervous system disease, March 27, and analysts expect that drug may contribute an additional $3.4 billion in sales in 2017.

“Tecfidera’s blockbuster potential, a solid base business, and a strong pipeline will allow Biogen Idec to post industry- leading long-term growth,” Eric Schmidt, an analyst with Cowen & Co., wrote in an April 22 research note.

Biogen shares rose 2.3 percent to $211 at 7:15 a.m. New York time. They had gained 41 percent this year through yesterday, rising to a record after Tecfidera gained U.S. approval.

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