Incyte's Jakafi Patent Expiry In 2028 Poses Challenge, Analyst Says New Treatments To Battle For Market Share

Incyte Corporation's INCY Q2 adjusted EPS reached $0.99, compared to $1.01 posted a year ago. Analysts had estimated $0.87. 

Q2 revenues increased by 25% Y/Y to $954.61 million, beating the consensus of $920.18 million.

Jakafi product revenues grew 14% Y/Y to $682 million, driven by strong underlying patient demand growth across all indications. Wall Street estimate stood at $655.2 million.

Opzelura's revenues of $80 million grew 384% Y/Y, driven by patient demand growth and payer coverage expansion as the launch in AD and vitiligo continues.

William Blair says that as the Jakafi franchise matures, it continues to show promise for near-term growth across its approved applications and through the LIMBER programs' lifecycle management potential. 

The initial launch of Opzelura was rocky, but the opportunities it presents in treating atopic dermatitis, vitiligo, and other conditions currently in clinical trials could make it a significant revenue generator for Incyte as they move into dermatological diseases. 

The analyst Matt Phipps says Incyte shares have the potential for upward movement, thus maintaining Outperform rating. 

Although Jakafi remains a leading therapy with several approved applications, new competition, and potential novel therapies could affect its market share. 

The analyst also notes Incyte's heavy reliance on Jakafi sales/royalties makes competition and its patent expiration in mid-2028 ongoing issues. 

The company's novel treatments, including Monjuvi and Pemazyre, face a competitive market and must prove superior clinical outcomes to secure a significant market share.

Guidance: The company raised the low end of its annual forecast range for Jakafi sales to $2.58 billion from the $2.55 billion expected earlier while keeping the high end unchanged at $2.63 billion.

Price Action: INCY shares closed lower 0.05% at $63.69 on Tuesday.