BIIB - Biogen trims down R&D programs Q1 revenue dips but reaffirms FY23 outlook

2023-04-25 08:01:00 ET

Biogen ( NASDAQ: BIIB ) stock is trading in the red premarket Tuesday after the company said it is discontinuing certain drug programs amid reporting its Q1 results, which beat estimates.

Biogen said it will terminate its involvement in developing BIIB093 (glibenclamide IV), currently in a phase 3 trial for large hemispheric infarction and a phase 2 trial for brain contusion, due to operational challenges and other strategic considerations.

The company has sent a letter of termination to Remedy Pharmaceuticals, the original developer of BIIB093. Remedy has 30 days to exercise its reversion right to take over development of both programs.

During this period, both trials will continue as planned. Biogen expects its decision to lead to a modest reduction in full year 2023 R&D expense with more meaningful savings expected in coming years.

In addition, Biogen said it is pausing the start of a phase 2b trial of BIIB131 (TMS-007) for acute ischemic stroke and is evaluating whether to begin the study.

Biogen also noted that as part of its ongoing R&D prioritization activities, it is discontinuing the development of BIIB132 in spinocerebellar ataxia type 3.

"We also continue to remain diligent in prioritizing our R&D pipeline, optimizing our operating model, and evaluating external opportunities as we work to establish a sustainable growth trajectory," said Biogen President and CEO Christopher Viehbacher.

Q1 Non-GAAP EPS declined -6% Y/Y to $3.40, while total revenue fell ~3% Y/Y to ~$2.46B. However, both top and bottom line surpassed analysts estimates.

Revenue from new Alzheimer's therapy Leqembi (lecanemab) was -$18.9M. The company said that starting in Q1 the reimbursement to Eisai ( OTCPK:ESALF ) ( OTCPK:ESALY ) for Biogen's share of U.S. Leqembi SG&A expense is reflected as a component of revenue rather than SG&A.

Multiple sclerosis franchise sales declined -19% Y/Y to ~$1.13B. Tecfidera revenue fell -33% Y/Y to $274.5M.

Spinal muscular atrophy (( SMA )) revenue, which is from the drug Spinraza, fell -6% Y/Y to $443.3M.

Outlook :

Biogen reaffirmed its FY23 outlook and expects total revenue to be mid-single digit percentage decline versus reported full year 2022.

Non-GAAP EPS is expected between $15 to $16 ( Consensus $15.43).

BIIB -1.72% to $288 premarket April 25

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