Why Jazz Is Expected to Report a Robust Revenue Growth Rate



Key milestones in 2017

On August 3, 2017, Jazz Pharmaceuticals (JAZZ) managed to secure regulatory approval from the FDA (US Food and Drug Administration) for its innovative drug, Vyxeos, as a treatment option for two types of AML (acute myeloid leukemia) characterized by poor prognosis. The drug targets a newly diagnosed therapy-related AML as well as AML with myelodysplasia-related changes and managed to secure approval two months ahead of the FDA’s PDUFA (Prescription Drug User Fee Act) date.

On June 6, 2017, the company also presented positive data from its phase-3 trials evaluating the investigational drug JZP-110 in patients suffering from narcolepsy, obstructive sleep apnea, and excessive sleepiness at the 31st Associated Professional Sleep Societies annual SLEEP meeting.

Jazz Pharmaceuticals also reported positive data from its phase-3 trial evaluating Xyrem in pediatric narcolepsy patients with cataplexy.

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Robust revenue growth in 2017

Wall Street analysts have estimated JAZZ’s fiscal 2017 revenues to be ~$1.6 billion, which would be a YoY (year-over-year) growth of ~10.1%. JAZZ expects its total revenues to be in the range of $1.63 billion–$1.70 billion for fiscal 2017.

By comparison, Peers AbbVie (ABBV), Celgene (CELG), and Ionis Pharmaceuticals (IONS) are expected to report revenues close to $27.9 billion, $13.3 billion, and $431.3 million, respectively.

JAZZ has been involved in patent litigations related to its flagship product Xyrem with generic players like Lupin Pharmaceuticals, Allergan’s Watson Laboratories, Par Pharmaceuticals, and Amneal Pharmaceutical. The consolidated litigation may be scheduled to be heard in court in 1H18.

In June 2017, JAZZ received notice about Ascent Pharmaceuticals’ submission of an ANDA (abbreviated new drug application) to the FDA for Xyrem. To protect its patent estate, JAZZ filed litigation against Ascent Pharmaceuticals in July 2017.

Notably, the SPDR S&P Pharmaceuticals ETF (XPH) has about 4.1% of its total portfolio holdings in JAZZ.

In the next part of this series, we’ll discuss JAZZ’s margin performance.


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