Biogen’s Oral MS Drug Tops Estimates, Brings in $192M in First Quarter

7/25/13Follow @benthefidler

The hype for Biogen Idec’s (NASDAQ: BIIB) oral pill for multiple sclerosis, dimethyl fumarate (Tecfidera), was deafening when the FDA gave the biotech the green light to begin selling the drug in March.

Though Biogen didn’t blow the doors down today with its first look at the drug’s sales, the Cambridge, MA-based company still beat the numbers predicted by analysts by a sizeable margin.

Biogen released its second-quarter earnings today, which, importantly, gave investors their first official look into dimethyl fumarate’s launch trajectory. Those numbers showed that the drug hauled in $192 million in U.S. sales in its first quarter on the market, but the key number here is that $110 million of that total comes from underlying patient demand. The other $82 million is attributed to wholesalers stocking up their inventory of the drug. Going forward, Biogen executives indicated on a conference call with analysts Thursday, wholesale inventory levels will remain stable, meaning growth will primarily come from prescriptions.

While those numbers aren’t jaw-dropping, they tracked ahead of analysts’ estimates for the quarter. ISI Group’s Marck Schoenbaum, for example, predicted at least $90 million worth of sales due to patient demand. Leerink Swann’s Marko Kozul estimated $73 million. Consensus estimates overall were around $65 million.

“We’ve now seen [dimethyl fumarate’s] launch trajectory exceed all previous MS launches,” said Tony Kingsley, Biogen’s executive vice president of global commercial operations, on the call.

Dimethyl fumarate is expected by several investors to eventually become the best-selling treatment for MS, a debilitating neurogenerative disease. MS has traditionally been treated by injectable drugs, such as Biogen’s own natalizumab (Tysabri) and interferon beta (Avonex), but effective and safe oral treatments have long been sought after due to their convenience. Biogen’s drug is one of a growing class of those oral treatments. Novartis’s fingolomid (Gilenya) was cleared by the FDA in September 2010, and Sanofi’s terflunomide (Aubagio) followed in September 2012. Biogen’s drug, however, boasts the best safety rating of the bunch. Fingolomid posted $252 million in sales in its most recent quarter, while terflunomide had $26 million.

In a recent research note, Leerink’s Kozul projected that dimethyl fumarate’s U.S. revenue will climb to $4 billion in 2017. The drug is currently sold in the U.S., Canada, and Australia. Biogen’s plans to sell the drug in Europe have been delayed due to regulatory data protection issues. Executives declined to give a timeline for the drug’s availability in Europe, and also indicated that it isn’t expecting the drug to “meaningfully” contribute to its revenue in its 2013 fiscal year.

The numbers for Biogen across the board were solid on what was a good earnings day for biotech. The company raised its guidance for 2013, projecting year-over-year revenue growth of between 22 and 23 percent and earnings per share of $8.50. Total revenue for the quarter was $1.7 billion, a 21 percent jump compared to the same period in 2012.

Ben Fidler is Xconomy's Deputy Biotechnology Editor. You can e-mail him at bfidler@xconomy.com Follow @benthefidler

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