2018 Biotech Sector Watch on Earnings #2: ABBV, ALXN, BMY…Updates VRTX

Update 4/30… Vertex Pharmaceuticals (VRTX) Beat Consensus by 4%

Financial Results: CF Revenues rose 33% Q’18 o Q’17 from $481M to $638M; GAAP net income down 15% ,$210M from $241M. Two Phase 3  triple combination clinical development programs are underway : VX-559 and VX-441 best for 2020 launch as well as pain and sickle cell R&D. 

Financial metrics are expensive despite Vertex leadership position in cystic fibrosis (CF): PE 180.4, PS 16.3, PEG 1.97, Sales QtQ up 42.1%, EPS QtQ 191%. Stock up 1.5% YTD, up 28.25 over 12 mos.


Biotech Sector Watch: Large Cap Biopharma Boosted by Q1 Earnings Reports

IBB Up 2.2% to $105+ above 2018 low of $100.22, down 3.7% YTD

Biotech Stocks Rally Off Recent Bottom

Abbvie (ABBV) is back on track with 2018 Financial results and Q1 revenue beat and raising full-year earnings forecast. Net Revenue rose 21.4% to $7.93B ahead of average estimate of $7.59B, and sales of Humira rose to $4.71B. Imbruvica sales (Pharmacyclics acquisition) rose to $762M. Global HCV sales soared to $719M. The Company raised its expected 2018 EPS to a range of $7.66-7.76 from $7.33-7.43. Net earnings for Q1 rose to $2.78B or $1.74 per share. The Company also announced a share buyback of up to $7.5B. We reported on ABBV in January at the JPMorgan Healthcare Conference. The stock hit a high of $123 on 1/26/18 but then took a hit in mid-March from a failed clinical trial and the write-down of a key pipeline asset ROV-T and $5.8B acquisition of Stemcentrx. ABBV is up 5.8% today to $97.23.

Alexion (ALXN) stock soared 14.6% on 2018 Financial Results with sales and earnings beat. total revenues were $930.9M a 7% increase over the same period in 2017. Net profit was $249.1M or $1.11 per share.The Company also announced positive Phase 3 results from ALXN1210 a long acting C5 Complement Inhibitor for treating a rare disease PNH. The drug offers a transition therapy to Soliris. Alexion expects full year revenue of $3.93-3.99B and full year earnings of $6.75-6.90. ALXN stock at $121.5 is down 2.15% YTD off lows in the $105 area.

Bristol Myers-Squibb (BMY) raised its full year earnings forecast but near term sales disappointed. Revenues rose 5% to $5.2B which was 15 below consensus’s estimates.Net profit dropped to $1.5B or 91 cents a share compared to $1.52 or 94 cents a year ago. sales of blood clot preventer Eliquis gained market share andcsales jumped 37% to $1.5B berating estimates of $1.34B. Opdivo sales rose 34% to $1.51B but there are still concerns about competition from Merck’s Keytruda. BMY has a strong immunoscience pipeline but the stock is down 11 points to to $52 level a 52 week low since the J.P.Morgan Conference Presentation in early January with concern about of Keytruda results.

Other notable movers: CELG up 3% well off recent bottom, gene editing stocks coming back-CRSP,EDIT, XBI up 1.7% with broad biotech rally.

Disclosure: Long ABBV, BMY, FBIOX


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