Can Biogen Keep the Beat Streak Alive This Earnings Season?

Biogen BIIB will report first-quarter 2025 results on May 1, before market open. In the last reported quarter, the company's earnings beat expectations by 0.58%. The Zacks Consensus Estimate for first-quarter sales and earnings is pegged at $2.24 billion and $3.34 per share, respectively. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)

Factors to Consider for Biogen

In the first quarter, lower sales of multiple sclerosis (“MS”) drugs are likely to have been offset by revenues from new drugs.

Sales of Biogen’s MS drugs like Tecfidera and Tysabri are likely to have declined amid rising competitive pressure in the market. Tecfidera sales are declining as multiple generic versions of the drug have been launched in the United States, Brazil and certain EU countries.

Regulatory applications seeking approval for a biosimilar referencing Tysabri have been approved in both the United States and Europe. A Tysabri biosimilar is now available in some European countries, with additional launches in others and in the United States expected in 2025.

The Zacks Consensus Estimate and our model estimate for first-quarter sales of Tecfidera are pegged at $199.0 million and $185.7 million, respectively.

The Zacks Consensus Estimate and our estimate for Tysabri are pegged at $363.0 million and $348.6 million, respectively.

Sales of another MS drug Vumerity rose in the fourth quarter due to higher demand and favorable channel dynamics in the United States. It remains to be seen if the improving trend continued in the first quarter of 2025.

The Zacks Consensus Estimate for Vumerity is $141.0 million, while our estimate is $139.8 million.

The decline in MS revenues is expected to be steeper in 2025 than in 2024 due to the potential biosimilar entry for Tysabri in the United States and the potential generic entry for Tecfidera in some European markets.

Sales of Biogen’s spinal muscular atrophy drug, Spinraza, improved in the fourth quarter due to higher sales in the United States, as higher pricing offset the negative impact of a decrease in demand. We believe that decreased demand amid competitive pressure is likely to have hurt sales in the United States in the first quarter,too.

The Zacks Consensus Estimate and our estimate for Spinraza are pegged at $364.0 and $338.1 million, respectively.

Though sales of Biogen’s newly launched drug Skyclarys for Friedreich’s ataxia are likely to have risen on a year-over-year basis, some Medicare discount dynamics might have tempered sequential growth in the United States. Ex-U.S. sales are expected to be a more important driver of growth for Skyclarys in 2025.

The Zacks Consensus Estimate and our estimate for Skyclarys are pegged at $110.0 million and $111.4 million, respectively.

Another new drug, Zurzuvae’s launch has exceeded the company’s internal expectations backed by strong patient demand. Sales are likely to have improved sequentially in the first quarter.

Biogen has a collaboration with Sage Therapeutics SAGE for Zurzuvae. Biogen and Sage equally share profits and losses for the commercialization of Zurzuvae in the United States. In outside U.S. markets, Biogen records product sales (excluding Japan, Taiwan, and South Korea) and pays royalties to Sage. Zurzuvae has not yet been approved in the EU.

Contract manufacturing and royalty revenues and Alzheimer’s collaboration revenues are expected to have risen in the quarter. Alzheimer’s collaboration revenues include Biogen’s 50% share of net product revenues and cost of sales (including royalties) from Alzheimer’s drug Leqembi (lecanemab), which has been developed in collaboration with Eisai.

Leqembi sales improved sequentially in the past two quarters, with the positive trend expected to continue in the first quarter. Leqembi sales are recorded by Eisai. Leqembi has already been launched in the United States, Japan, China and some other countries. On the fourth-quarter conference call, the company had said it is seeing strong growth in China and Japan, which is likely to have contributed to growth in the first quarter of 2025. Leqembi was approved in the European Union earlier this month.

A less frequent maintenance intravenous dosing version of Leqembi was approved by the FDA in January 2025, while a regulatory application for the subcutaneous autoinjector is under review with a decision from the FDA expected on Aug. 31, 2025.

Overall, revenues in the first quarter of 2025 are expected to have been hurt by seasonality, driven by higher discounts and allowances as well as channel dynamics in the United States. Fx headwinds and the negative impact of the Medicare Part D redesign are likely to have hurt top-line growth.

Key Event in the Quarter

In February, Biogen announced that it has entered into a collaboration with Stoke Therapeutics STOK to develop and commercialize zorevunersen for the treatment of Dravet syndrome in all territories outside of the United States, Canada and Mexico, where Stoke has exclusive rights. Stoke Therapeutics will lead the global development of the candidate. Stoke Therapeutics is on track to begin a phase III pivotal study called EMPEROR on zorevunersen in the first quarter of 2025.

BIIB’s Earnings Surprise History

The company’s earnings beat estimates in each of the last four quarters. The company has a four-quarter earnings surprise of 11.8%, on average.

Biogen Inc. Price and EPS Surprise

Biogen Inc. price-eps-surprise | Biogen Inc. Quote

Biogen’s stock has declined 22.8% so far this year compared with a decrease of 6.0% for the industry.

What Our Model Says for BIIB

Our proven model does not conclusively predict an earnings beat for Biogen this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.

Earnings ESP: Biogen’s Earnings ESP is -15.8%. The Zacks Consensus Estimate is pegged at $3.34 per share, while the Most Accurate Estimate is pegged lower at $2.81 per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Biogen has a Zacks Rank #3.

Stock to Consider

A drug/biotech stock that has the right combination of elements to beat on earnings this time around:

AstraZeneca AZN has an Earnings ESP of +2.73% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

AstraZeneca’s stock has risen 6% so far this year. AZN beat earnings estimates in three of the last four quarters while missing on the remaining occasion. On average, AstraZeneca witnessed an earnings surprise of 3.16% in the last four quarters. AstraZeneca is scheduled to release its first-quarter results on April 29.

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This article originally published on Zacks Investment Research (zacks.com).

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