Regeneron, Sanofi Could Appease LDL-Frustrated Buyers On Eczema Drug – Investor’s Business Daily

Regeneron could still get an on-time OK for an eczema drug, despite a recent legal loss to Amgen. (Regeneron)

Though Regeneron (REGN) and Sanofi's (SNY) LDL-buster lost in a patent battle with Amgen (AMGN), the duo could appease investors with an on-time approval of extreme eczema drug dupilumab, says RBC analyst Adnan Butt.

Butt expects dupilumab to beat expectations and turn momentum positive. The latter is particularly important after a U.S. District Court judge on Jan. 6 sided with Amgen in a patent battle pitting Amgen's Repatha against Praluent. In her decision, the judge banned Regeneron and Sanofi's Praluent.

Regeneron stock toppled 6% that day, and Sanofi shares dipped 3%. Since then, Regeneron shares have fallen an additional 3%. Praluent is slated to be pulled from shelves Feb. 21 if a federal circuit judge doesn't grant a stay on the injunction pending the appeal.

Analysts have already largely removed Praluent from their expectations for Regeneron, Butt wrote in a research report Monday. Fortunately for Regeneron and Sanofi, an on-time approval for dupilumab to treat extreme atopic dermatitis looks likely, he says.

"The FDA deemed the Sanofi facility 'acceptable' and Regeneron has a backup third-party facility it can use if it needs to," he wrote in a research report. "We forecast sales of $123 million while consensus for 2017 is $177 million to 196 million."

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Butt kept his outperform rating and 598 price target on Regeneron stock. In the stock market today, though, Regeneron stock slipped 0.58% to 344.50, and Sanofi edged upa fraction to 40.

Regeneron's pipeline "has delivered more than disappointed," Butt said.

Besides dupilumab,he's bullish on Eylea, an injection for wet macular degeneration, diabetic macular edema and macular edema following retinal vein occlusion. There, Regeneron faces competition from Novartis (NVS).

On its Q4 earnings conference call with analysts last week, Novartis noted Phase 3 data for its wet AMD drug, RTH258, is due in Q2.Novartis is seemingly aiming at fewer objections, Adnan wrote. But "Eylea sets a high bar," he added.

"What would be worth watching is if RTH258 dries patients who remain nonresponsive to Eylea, similar to how Eylea gained share over Lucentis and Avastin," he wrote.

This month, Regeneron preannounced $858 million in Q4 Eylea sales. Sequentially, growth has slowed over the past two quarters, but the consensus still sees year-over-year growth of 12% in 2017. A guide of 10% in 2017 could be well-received, Butt wrote.

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The Medicines Company outperformed Amgen stock early Friday, rocketing after No. 1 biotech Amgen said LDL-buster Repatha curbs cardiac events. (Kris Tripplaar/Sipa USA/Newscom)

2/03/2017 The Medicines Company outperformed Amgen stock early Friday, rocketing after Amgen said Repatha curbs cardiac events.

2/03/2017 The Medicines Company outperformed Amgen stock early Friday, rocketing after...

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Regeneron, Sanofi Could Appease LDL-Frustrated Buyers On Eczema Drug - Investor's Business Daily