Biogen Profit Beats Estimates as New CEO Takes the Helmby
Biogen Inc. posted fourth-quarter profit that beat analysts’ estimates after cutting expenses as sales growth of its top multiple sclerosis drug stalled, the last set of results before new Chief Executive Officer Michel Vounatsos took the helm of the biotechnology company.
Earnings were $5.04 a share last quarter, excluding some items, the company said in a statement Thursday, compared with the $4.96 average projection. The shares rose 1 percent to $276 in early U.S. trading.
Vounatsos has pledged to boost Biogen’s flagging sales and focus on a recently-approved therapy, called Spinraza, for a rare and deadly muscle disease that will cost $750,000 in the first twelve months of treatment in the U.S. and $375,000 each year thereafter. High-priced medicines have come under new pressure as President Donald Trump slammed the industry earlier this month, saying it was “getting away with murder.”
Anthem Inc., which covers around 40 million Americans, has already restricted access to Spinraza. Earlier this month, the insurer said only the most severe patients with spinal muscular atrophy would be approved to take the therapy, and would need to demonstrate a need to remain on it every six months.
The company sees earnings of $20.45 to $21.25 a share this year, excluding some items, which may not compare with the $21.03 average of predictions compiled by Bloomberg as Biogen plans to spin out its hemophilia division into a new company next month.
Vounatsos, who assumed leadership this month, said he will increase dealmaking at the Cambridge, Massachusetts-based biotech giant, where former CEO George Scangos came under fire for a conservative approach to acquisitions.
The new executive will be under continued pressure to increase sales of the company’s multiple sclerosis drugs. Biogen’s lead therapy, a pill called Tecfidera, brought in $1 billion in the fourth quarter, in line with analysts’ estimates and slightly less than the $1.03 billion in the prior quarter. Last week, U.S. regulators ordered Biogen to add warnings to Tecfidera’s label to address recent reports of liver injury.
Vounatsos also cleared a lingering worry about the company’s patent claims for Tecfidera with a $1.25 billion agreement this month with Forward Pharma A/S.