Avadel Pharmaceuticals Misses Earnings Estimates But Posts 150% Sales Increase From Narcolepsy Drug LUMRYZ

Avadel Pharmaceuticals AVDL slipped by 25.63% in after-hours on Wednesday after it missed the fourth quarter sales estimate by 5.12%. Still, the sales of its narcolepsy drug, LUMRYZ rose by 150% on an annual basis.

What Happened: The preliminary earnings results for the fourth quarter pegged a 150% increase in net product revenue to $50 million, as compared to $19.5 million in the fourth quarter of 2023. This missed the consensus analyst estimate by 5.12%, which was expected to be $52.7 million, according to Benzinga.

The biopharmaceutical company is focused on treating cataplexy, excessive daytime sleepiness, and other sleep disorders in adults and children above seven.

The company reported a full-year net product revenue of approximately $169 million compared to $28 million in 2023. Its cash flow from operations stood at approximately $73 million for the quarter ended Dec. 31, 2024.

Greg Divis, CEO of Avadel Pharmaceuticals, highlighted 2024 as a pivotal year, emphasizing the consistent patient adoption of LUMRYZ and the overwhelmingly positive feedback from both patients and providers regarding the life-changing benefits of its once-nightly dosing regimen.

Why It Matters: There was a 275% increase from 900 patients on LUMRYZ in 2023 to 2,500 in 2024. According to its press release, demand continued across all three patient segments in the fourth quarter, with 34% of patients being new to oxybates and 38% switching from first-generation oxybates.

The company expects the net product revenue for 2025 in the range of $240 million to $260 million, representing a 50% increase at the midpoint of guidance from 2024 and a positive cash flow of $20 million – $40 million.

Divis added that moving into 2025, the company is refining its strategy to increase LUMRYZ’s demand and aiming to drive uptake across all narcolepsy patient segments. “We’re well-positioned to lead in the sleep space and transform care for patients with sleep disorders.” he said.

Price Action: Avadel shares have fallen by 32.72% over the last six months, underperforming the Nasdaq Biotechnology Index, which fell by 5.07% in the same period. Furthermore, the exchange-traded fund tracking the index, iShares Biotechnology ETF IBB fell 2.9% over the last six months.

According to Benzinga Pro data, AVDL has a consensus price target of $20.9 per share, with a ‘buy’ rating based on the ratings of 10 analysts. The highest price target out of all the analysts tracked by Benzinga is $30 issued by Oppenheimer as of Oct. 31, 2024. The lowest target price is $11 per share issued by Jefferies on Nov. 30, 2024.

The average price target between HC Wainwright & Co., Needham, and Needham implies an 189.31% upside for AVDL.