Biotech Earnings Review: Celgene, Biogen

An overview of how seven big biotech companies fared in the January-March quarter.
By Elizabeth Trotta ,

On Thursday,

Celgene

(CELG) - Get Report

aired its quarterly results, marking the last report of the

big biotech companies previewed

before

Genentech

(DNA)

kicked off earnings season for the sector.

In review, these companies didn't disappoint on profit -- all seven beat consensus targets (which typically factor out one time charges) with their adjusted earnings-per-share results. Revenue came in close to estimates for most of the biotechs, with

Biogen Idec

(BIIB) - Get Report

and Celgene providing the largest surprise.

Among other things, the quarter included the Food and Drug Administration's decision against the recommendation of its advisory panel to approve Genentech's Avastin for the breast cancer indication.

Recent guidance adjustments include Celgene accounting for its Pharmion aqusition -- a 5- to 10-cent dilution on EPS and a $300 million addition to revenue for 2008. Also,

Genzyme

(GENZ)

scaled back its guidance to account for regulatory delays for the manufacturing of a larger-scale ver%sion of Pompe disease drug Myozyme.

Meanwhile, Biogen Idec increased sales and revenue guidance while

Cephalon

(CEPH)

nudged its sales guidance a bit higher for 2008.

Here's a summation of last quarter's results:

Genentech: April 10

Genentech delivered a per-share earnings beat of 2 cents but missed on expected sales of lead product, cancer drug Avastin.

The company earned $895 million, or 84 cents a share, on an adjusted basis, vs. $792 million, or 74 cents a share, on the same basis, the year prior. Revenue increased 8% to $3.06 billion, while Wall Street was looking for earnings of 82 cents a share on $3.1 billion in revenue.

Sales of cancer drug Avastin came in at $600 million, missing analyst estimates of between $614 million and $621 million. The company won U.S. regulatory approval for the drug in the breast cancer indication in February, marking a rare occurrence of the FDA going against the recommendation of one of its advisory panels.

Sales of Rituxan increased 13% year over year to $605 million, just beating the consensus target of $603 million, and Herceptin sales increased 9% to $339 million, surpassing expectations for $329 million. Lucentis sales came in at $198 million, short of the $202 million expectation.

Genentech maintained prior full-year earnings guidance of $3.35 to $3.45 a share.

For more on Genentech, check out these recent headlines from

TheStreet.com

:

Gilead (GILD) - Get Report: April 16

Gilead presented higher-than-expected sales in its HIV franchise and managed a 3-cent per-share profit beat on roughly in-line total revenue.

The company reported earning $522.1 million, or 54 cents a share, before items. Revenue rose 22% to $1.26 billion. Results beat the Thomson Reuters consensus target of 48 cents a share on $1.2 billion in revenue.

Sales totaled $1.14 billion for the quarter, with $946.7 million of that from the HIV franchise. Some highlights in the HIV franchise: Truvada brought in $479.4 million, beating the Wall Street consensus target of $468 million. Atripla sales totaled $324.2 million, beating the consensus target of $311 million. Viread sales decreased 5% to $152.7 million, but still beat Wall Street's target of $146 million.

On the quarterly conference call, management reiterated its full-year sales guidance and lowered its expected effective tax rate to between 28% and 29% from between 29% and 30% for full-year '08.

For more on Gilead, check out these recent headlines from

TheStreet.com

:

Genzyme: April 23

Genzyme managed a 2-cent per-share profit beat on revenue that was relatively in line with expectations. However, two days before earnings the company scaled back full-year guidance due to a regulatory delay for the manufacturing of the 2,000L scale of Pompe Disease drug Myozyme, and not long after it also announced greater-than-expected requirements for its joint-venture cholesterol drug Mipomersen that stand to lengthen the drug's path to approval.

On an adjusted basis (factoring out a $56 million charge related to the company's deal with Isis Pharmaceuticals), Genzyme reported profit of $260 million, or 95 cents a share, up from 78 cents a share in the year-ago quarter. Revenue increased 25% year over year to $1.1 billion. Wall Street analysts, who usually factor out one-time charges, were looking for earnings of 93 cents a share on revenue of $1.085 billion.

First quarter sales of Myozyme rose 78% to $67.3 million - Wall Street was looking for $68 million. Sales of Gaucher disease drug Cerezyme and Fabry disease treatment Fabrazyme came in at $304 million and $117 million, vs. consensus targets of $301 million and $118 million respectively.

Because of the

delay in larger-scale Myozyme

, the company is now predicting an adjusted profit of $3.90 a share for this year, compared with $4 a share previously expected, and GAAP earnings of $2.65 a share, also down 10 cents from its prior guidance.

Since earnings, Genzyme and partner

Isis Pharmaceuticals

(ISIS)

have announced expected delays in approvals of their cholesterol lowering product, Mipomersen. The FDA is now asking for data from two ongoing preclinical carcinogenicity studies in order for the drug to be filed in homozygous familial hypercholesterolemia, a severe form of high cholesterol that creates an increased risk of premature cardiovascular disease. And for broader, high-risk populations, the U.S. regulatory agency will require an outcomes study, which the company's plan to begin in 2009.

It is not clear yet if that delay will affect the terms of the deal between the companies, which has yet to close.

For more on Genzyme, check out these recent headlines from

TheStreet.com

:

Biogen Idec: April 23

Biogen beat on adjusted earnings and revenue, aided by strong sales of two key drugs, and upped its expectations for the year.

Sales of Rituxan, a treatment for B-cell non-Hodgkin's lymphomas and rheumatoid arthritis, rose 19% to $247 million as reported by Biogen's partner Genentech. Analysts had looked for $251 million.

But Biogen's multiple sclerosis drugs Avonex and Tysabri beat estimates. Sales Avonex increased 19% to $536 million, vs. the Street consensus of $490 million. Sales of MS and Crohn's disease drug Tysabri, for which Biogen partners with

Elan

(ELN)

, totaled $160 million. Biogen recognizes $115 million of that, edging past the $113 million consensus target.

Factoring out pre-tax charges of $100 million for in-process R&D and one-time items, the company reported adjusted profit of $250 million, or 83 cents a share. Revenue rose 32% to $942 million, and results beat the expectations of Wall Street analysts who were looking for 79 cents a share on revenue of $890 million.

Biogen also raised its full year guidance for adjusted profit of $3.25 to $3.45 a share, up from prior guidance of $3.20 to $3.35 a share. The company also predicts total revenue growth of roughly 20% of the prior year, which translates to $3.8 billion, compared to prior guidance of 15%-20% growth, or between $3.6 billion and $3.8 billion.

For more on Biogen, check out these recent headlines from

TheStreet.com

:

Amgen (AMGN) - Get Report: April 24

Its anemia-drug franchise still in decline, Amgen posted a mixed quarter with declining top and bottom lines but an adjusted per-share profit that beat expectations.

Amgen said adjusted net income fell 4% to roughly $1.2 billion. But on a per-share basis, the company reported adjusted profit of $1.12 a share, compared to $1.08 a share in the year-ago quarter. The company beat the Street's $1.05-a-share profit target, but revenue decreased 2% to $3.613 billion, relatively in line with the $3.624 billion consensus.

Roughly in line with estimates, Aranesp sales fell 25% to $761 million, including a 4% benefit from foreign exchange. But Epogen revenue fell 11% to $554 million, falling short of the Street's $604 million expectation. Amgen said sales were affected by dose reductions, revised demand estimates and unfavorable inventory changes.

Combined sales of Neulasta and Neupogen increased 7% to $1.08 billion, shy of the $1.1 billion Wall Street estimate. And Sales of Enbrel increased 30% to $951 million, much higher than the $855 million consensus. (However, the company said the increase included $120 million in stocking.)

Amgen's Research & Development expenses decreased 18% to $661 million.

The company reaffirmed its 2008 guidance of adjusted profit between $4 and $4.30 a share, and revenue in a range of $14.2 billion to $14.6 billion.

For more on Amgen, check out this recent headline from

TheStreet.com

:

Cephalon: May 1

Factoring out buyout and restructuring charges and other costs, Cephalon earned $1.12 a share in the recent quarter on revenue of $443.2 million.

Analysts polled by Thomson Reuters had pegged profit of 96 cents a share, on revenue of $444.6 million.

Cephalon reaffirmed expectations for profit between $3.75 and $3.85 per share, or between $5.10 and $5.20 on an adjusted basis. The company updated its total sales guidance to between $1.83 billion and $1.88 billion from between $1.8 billion and $1.85 billion.

Since then, a Food and Drug Administration advisory panel voted 17-to-3 to recommend the regulatory agency not grant wider approval for Cephalon's pain treatment Fentora on the premise that such an expansion could increase the potential for drug abuse.

The drug is currently approved to treat breakthrough pain, or severe pain in cancer patients who are already taking prescription opioids. But Cephalon was seeking to expand the approved uses to include chronic pain in non-cancer patients. FDA action on the Fentora supplemental new-drug application (sNDA) is expected by Sept. 13.

The company has reiterated the above guidance for 2008 since the panel, expecting 2008 financials to be unaffected.

For more on Cephalon, check out this recent headline from

TheStreet.com

:

Celgene: May 8

Factoring out a $1.74 billion charge related to the acquisition of Pharmion, Celgene reported adjusted profit of $159.3 million, or 36 cents a share. Sales of multiple myeloma (MM) drug Revlimid totaled $286.8 million, surpassing analysts' expectations of $272 million, and helping total revenue rise 58% to $462.5 million.

Results surpassed the Thomson Reuters target of 34 cents a share on revenue of $444 million.

The company updated its guidance to include the Pharmion acquisition, which closed on March 8. It's expecting adjusted profit of $1.45 a share, including a 5-cent to 10-cent dilution from the Pharmion acquisition, on revenue of roughly $2.1 billion, a 60% increase year over year.

(Prior to factoring the acquisition into guidance, the company expecting between $1.50 a share and $1.55 a share on total revenue of $1.8 billion.)

For more on Celgene, check out this headline from

TheStreet.com

:

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