While the biotech’s third-quarter revenue beat Wall Street expectations, its $7.3 billion acquisition of Reata Pharmaceuticals—which closed in September—negatively impacted 2023 per-share earnings.
Pictured: Biogen sign/The Boston Globe via Getty, John Tlumacki
Biogen did not see any significant gains in revenue in the third quarter, while its full-year guidance has been reduced due to the costs of the biotech’s $7.3 billion acquisition of Reata Pharmaceuticals.
According to its third-quarter report released on Wednesday, Biogen saw total revenue of over $2.53 billion, a 1% increase from the same period last year. However, the company has reduced its guidance for 2023, stating that this year will have a “low-single-digit percentage decline versus reported the full year 2022.”
This percentage decline stems from Biogen’s acquisition of Reata, which was announced in July 2023 and closed in September. Biogen also laid off 113 workers from Reata’s site in Plano, Texas, in early October. Other factors that Biogen detailed were the regulatory approval for Zurzuvae in post-partum depression and the “modification” made to the “presentation of Leqembi expenses.”
For the sales of Leqebmi, the Alzheimer’s medication approved in the summer of 2023, Biogen reported that “in-market product revenue” was around $2 million, which Eisai recorded. However, Biogen also saw a dip in revenue from its multiple sclerosis products, pulling in $1.1 billion for the quarter, a 14% drop from the third quarter of 2022.
Total product revenue was also recorded at $1.8 billion in the third quarter of 2023, an 8% drop from the prior year period. However, one area in which Biogen saw a massive jump in sales was in the contract manufacturing sphere, where it secured $304 million in the quarter—a 135% jump from the third quarter of last year.
“We believe we have the key elements to position Biogen for long-term sustainable growth. Biogen has made significant progress on the business priorities outlined at the beginning of the year. During the third quarter alone, we received FDA approval for Leqembi and Zurzuvae, announced the closing of the Reata transaction, and initiated our $1 billion Fit for Growth cost savings program. As we look ahead, the focus remains on execution,” Biogen CEO Christopher Viehbacher said in a statement.
Mizuho analyst Salim Syed noted in a report that the third quarter “overall seems fine” for Biogen, with product sales coming “in line” against consensus estimates.
For Leqembi, Viehbacher also said that Biogen plans to “further its leadership” in Alzheimer’s by driving the launch of Leqembi and advancing the development of its tau-directed investigational antisense oligonucleotide (ASO), giving the company another “foothold in the fight against Alzheimer’s disease.”
“In addition to potential revenue and EPS growth from new launches, Fit for Growth is expected to significantly strengthen our bottom-line growth,” Viehbacher added.
Biogen and Eisai have been forging ahead with its Alzheimer’s portfolio ever since its Leqembi landed full FDA approval earlier this year. In October, both companies revealed new data from the open-label extension phase of the Clarity AD study, revealing that the subcutaneous formulation of Leqembi can effectively clear amyloid plaques in the brain.
Tyler Patchen is a staff writer at BioSpace. You can reach him at tyler.patchen@biospace.com. Follow him on LinkedIn.
