- Biogen's recently spun out hemophilia business touted its better-than-expected performance in the early months of 2017, raising optimism among some industry followers that the new business will stay profitable in the face of an array of near-term competition.
- During its debut quarter as a standalone company, Bioverativ reported revenues of $259 million — 35% higher than the same period in 2016 and about 4% higher than analysts' consensus estimates. The company saw a 5% increase in Eloctate (antihemophilic factor recombinant) income quarter-over-quarter, which helped offset an 8% decline in sales of Alprolix (coagulation factor IX recombinant).
- "Absent any major pitfalls, it's difficult to see the company not beating 2017 guidance of 17-19% revenue growth and non-GAAP operating margin of 43-47%, even with the entrance of competitive long-acting therapies," analysts from investment bank Piper Jaffray wrote in a May 4 note.
While Bioverativ has two promising products in Eloctate and Alprolix, treatments for hemophilia A and hemophilia B respectively, that's all it has, at least for now. The rest of the Waltham, Mass.-based company's drugs are in preclinical and discovery stages, though it does expect BIVV001, a hemophilia A drug with a once-weekly (at most) dosing regimen, to move into human testing in the second half of the year.
In and of itself that's not a huge problem. Plenty of medicine makers have started off with fewer products and shakier footing. Ties to Biogen and about $360 million in cash and cash equivalents that could be used for M&A or R&D buildout also help. But bigger players have already entered the long-acting hemophilia drug space — Bioverativ's bread and butter — and could take a bite out of the company's earnings.
Long-acting hemophilia treatments shifted the dosing paradigm, allowing patients to take their medications two or three times a week rather than every day. Bayer's Kovaltry and Kogenate and Shire's Adynovate, all recombinant antihemophilic factors, fall into this category. Novo Nordisk's N8-GP, a glycopegylated recombinant coagulant, and Roche's emicizumab, a monoclonal antibody, are both long-acting medications in late-stage testing.
Gene therapies are also poised to disrupt hemophilia markets, carrying the potential to change dosing regimens from once-daily or once-weekly to once every couple of years. UniQure and Biomarin are two examples of developers who have had clinical success with such treatments.
With all those potential game-changing therapies, Bioverativ will have to show its own products are ready to compete. The drugmaker blamed seasonality for Alprolix's weaker first quarter revenues, reasoning that didn't appear to put investors completely at ease. The company's shares finished at $55.98 apiece on Wednesday, down 2.6% from the previous day's close of market.
Industry followers, however, viewed this initial round of earnings more favorably.
Though the company maintained its 17-19% revenue growth guidance for 2017, analysts from Jefferies said in a May 4 note that the first quarter consensus beat signals that yearlong growth will likely be more robust.
"Despite 1Q seasonality, particularly for Alprolix in hemophilia B, and an increasingly competitive landscape, the company continues to identify new patients and is positioned well," in the short run, wrote Piper Jaffray analysts. They added that while rival drug developers may shake up the longer-term landscape of the hemophilia market, Bioverativ "has a long runway to continue to execute and identify attractive BD opportunities to further improve the company's outlook."