Zinger Key Points
- Needham forecasts Biogen revenues to remain stable until 2025, rising ~3% by 2026.
- Biogen will face ongoing challenges as expectations for Leqembi need to adjusted to more realistic levels.
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Needham downgraded Biogen Inc BIIB, citing limited catalysts for the company over the next year.
Alzheimer’s drug Leqembi’s (lecanemab) sales growth is expected to stay gradual without a sharp increase in the near future. The analyst remarked that the physician feedback and expert opinions indicate this slow pace will continue.
Leqembi’s third-quarter global in-market sales were approximately $67 million, including U.S. in-market sales of approximately $39 million.
Although investors are aware of this, market expectations are still high. Biogen will face ongoing challenges as these expectations are adjusted to more realistic levels.
In a positive move, last week, the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) recommended approval of Eisai Co., Ltd ESALY and Biogen’s lecanemab for early Alzheimer’s disease.
Needham projects Skyclarys’ fourth-quarter sales to reach approximately $116 million and $608 million for 2025. This aligns with management’s comments suggesting that U.S. sales growth may be uneven, while international growth could be slower due to pricing negotiations and a gradual increase in the number of patients on treatment.
Revenues from Skyclarys, acquired via Reata acquisition, reached $102.3 million during the quarter.
Needham writes that revenues are expected to remain flat or decline slightly until 2026, as it will take time for new products like Leqembi, Skyclarys, and Zurzuvae to grow enough to offset the drop in existing business.
Postpartum depression drug Zurzuvae’s third-quarter sales reached $22 million.
Needham has downgraded the stock from Buy to Hold with no price target, compared to $270 earlier.
Revenues are projected to fall by a small percentage in 2024, remain stable in 2025, and increase by about 3% in 2026, assuming continued growth from key product launches.
Operating margins are anticipated to improve by 80 basis points in 2025, driven by the Fit for Growth program, though this is already widely expected.
Business development could support growth in the short to medium term, but the timing and nature of such deals are hard to predict.
Price Action: BIIB stock is down 1.15% at $158.15 at the last check on Monday.
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