UPDATE 3-Biogen raises outlook as new MS drug again tops forecasts
(Adds investigation into sales and promotional practices; updates stock price, 6th paragraph)
By Bill Berkrot
April 23 (Reuters) - Biogen Idec Inc on Wednesday raised its full-year earnings and revenue forecasts as first-quarter sales of its new Tecfidera multiple sclerosis drug extended a run of eclipsing Wall Street sales expectations.
Tecfidera racked up sales of $506 million for the quarter, easily topping analysts' expectations of about $440 million and the previous quarter's sales of $398 million.
The oral medicine, which was approved in the United States in March 2013, had been on track to become the drug to reach $1 billion in sales in the shortest time. But that pharmaceutical industry record was shattered on Tuesday, when Gildead Sciences Inc said its Sovaldi hepatitis C treatment logged more than $2 billion in sales in its first full quarter on the market.
Based on the strong performance of its MS drugs, Biogen raised its full-year forecast and now expects revenue growth of 26 percent to 28 percent, up from a prior range of 22 percent to 25 percent.
The U.S. biotechnology company said it expected 2014 earnings, excluding items, of $11.35 to $11.45 per share, compared with a prior outlook of $11.00 to $11.20. Analysts on average are looking for a profit of $11.32 per share, according to Thomson Reuters I/B/E/S.
Shares of Biogen were down 0.6 percent at $304.41 in late afternoon trading.
"The raised guidance is a testament to the U.S. beat on Tecfidera sales and signals confidence in both the hemophilia launch as well as the Tecfidera launch in Europe," RBC Capital Markets analyst Michael Yee said.
Biogen plans to begin selling Alprolix, its recently approved long-acting treatment for hemophilia B, in the United States in early May. The company said last week it would price Alprolix on a par with older, less convenient treatments, which should help it get off to a strong start.
The company reported net income of $479.9 million, or $2.02 per share for the quarter, compared with $426.7 million, or $1.79 per share, a year earlier.
Excluding special items, Biogen said it earned $2.47 per share, missing the analysts' average estimate of $2.55. But the company said its earnings were reduced by about 35 cents a share due to a $118 million expense from a collaboration with Japan's Eisai Co on development of Alzheimer's disease treatments.
Without that expense, "the (earnings) number could have been as high as $2.82, which would have crushed expectations," Yee said.
Revenue jumped 51 percent to $2.1 billion, edging past Wall Street estimates of $1.99 billion.
Biogen said $46 million of the Tecfidera sales came from outside the United States. The drug began selling in Germany in February, and the company said it planned to introduce the medicine in additional European countries in the coming months, with reimbursement agreements already secured in Norway and Scotland.
"We're encouraged by the signs from Germany," Tony Kingsley, Biogen's head of global commercial operations, told analysts and investors on a conference call.
Biogen's older MS drugs also performed well in the quarter.
Sales of Avonex rose 2 percent to $761 million, topping Wall Street estimates of about $735 million.
Tysabri sales were $441 million, an increase of 41 percent, due in part to Biogen's regaining full rights to the drug in the second quarter of last year.
Biogen said some patients were still discontinuing use of Tysabri, but the company had retained 70 percent of that business, primarily due to switchovers to Tecfidera.
The company also said in a regulatory filing that it was subpoenaed by state and federal authorities investigating its sales and promotional practices, and by the federal government for documents related to Biogen's relationship with certain pharmacy benefit managers.
The company, which had previously said it was being investigated by governmental authorities, said it was cooperating in the investigations. (Additional reporting by Deena Beasley; Editing by Lisa Von Ahn and Jonathan Oatis)
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