Jillian Dabney

Amgen (AMGN) launched Enbrel in the US in 1998. It became a major success for Amgen in no time and recorded $5.4 billion sales in 2015.

In the absence of biosimilars, the biotechnology industry enjoys benefits after patent expiry for a longer period.

Amgen (AMGN) is primarily focused on six therapeutic areas: oncology/hematology, cardiovascular, inflammation, bone health, neuroscience, and nephrology.

YTD, Amgen’s (AMGN) stock has already fallen 9%. Perhaps the pressure that Enbrel (etanercept) is seeing is to blame for the negative investor sentiment.

Amgen’s top-line growth is under pressure following the rising competition for key drug Enbrel, which had a 26% share in Amgen’s total product sales in 3Q16.

According to a Thomson Reuters Eikon consensus of six brokerage firms on December 17, 2016, 83.3% of the firms rated Horizon Pharma (HZNP) a “buy.”

Horizon plans to drive Krystexxa through increased awareness and outreach, investing in its marketing and medical education as well as commercial infrastructure.

During the third quarter of 2016, Rayos, a delayed-release prednisone, rose 15.0% to $13.4 million compared to 3Q15.

With the Express Scripts agreement, Horizon Pharma’s net sales in 2017 are expected to rise. The probability of a top-line expansion has boosted investor sentiment.

In 3Q16, Horizon Pharma’s (HZNP) net sales on a GAAP basis fell to $208.7 million. Non-GAAP net sales were $273.7 million.

On December 8, 2016, Horizon Pharma (HZNP) announced that its Phase 3 STEADFAST trial for Actimmune didn’t meet its primary endpoint. Horizon stock fell 22.5% that day.

During 2016, Pfizer (PFE) succeeded in expanding its label for Ibrance, its breast cancer treatment.

As of November 1, Pfizer had ~94 projects in various development stages. More than 40% of these projects are in phase three or the registration phase.

Year-to-date, Pfizer’s (PFE) stock has already fallen 4.2%. Despite its multiple acquisitions to boost its falling top line, investors are cautious about the company.

With the loss of patent protection for its flagship drug, Lipitor, Pfizer’s revenue fell to $48.8 billion in 2015, compared to $67 billion in 2010.

After Pfizer lost patent protection for Lipitor, Lyrica became increasingly important to it. During its peak in 2014, Lyrica added $5.2 billion to Pfizer’s top line.

Pfizer plans to use avelumab, a PD-L1 (programmed death-ligand 1) class immuno-oncology product, as a backbone therapy in its immuno-oncology programs.

Pfizer’s avelumab seems to be its potential growth driver for the next one to five years. Pfizer is developing the product with its partner Merck KGaA.

Since its launch in February 2015, Pfizer’s Ibrance has quickly captured the advanced breast cancer market and has reached more than 40,000 patients.

During 3Q16, Pfizer (PFE) recorded revenue amounting to $13 billion. Excluding the impact of foreign exchange, the company’s revenue rose 8% annually.

Considering the robust growth prospects for many of its products going forward, Pfizer should return to robust top line growth.

Specialty Generics’ contribution to Mallinckrodt’s net sales fell by 18% to $1 billion in 2016. The business had a 31% share in total net sales in 2016.

Specialty Brands had a 69% in Mallinckrodt’s total revenue in 2016, while Specialty Generics had a 31% share.

On an annual basis, MNK’s net sales soared by 16% to $3.4 billion in 2016. Despite its better-than-estimated performance, shares fell by 9% on November 29.

Of its three businesses, Bausch & Lomb’s share in Valeant Pharmaceuticals’ (VRX) overall EBITA (earnings before interest, tax, and amortization) was 32%.

Of its total outstanding shares, Valeant Pharmaceuticals’ (VRX) institutional ownership stood at 69.2%.

Mallinckrodt (MNK) has recently been making news due to its business model being questioned. A Citron Research report focused on the sustainability of Acthar’s higher level of exposure to government-oriented franchise.

With its continuous revenue fall, Gilead Sciences (GILD) could opt to restore its growth through acquisitions.

According to a Reuters consensus of 26 brokerage firms on November 22, 2016, 88% of the analysts recommended Gilead as a “buy.”

Gilead Sciences (GILD) is expected to garner $28.3 billion in 2017 and $26.7 billion in 2018.

With its costly HCV drugs, Gilead Sciences (GILD) has one of the highest net margins in the biotechnology industry.

With three products—Sovaldi, Harvoni, and Epclusa—in its arsenal, Gilead Sciences (GILD) dominates the HCV (hepatitis C virus) market.

Gilead Sciences’s (GILD) TAF-based (tenofovir alafenamide) regimen comprises three products: Genvoya, Descovy, and Odefsey.

During 3Q16, Gilead Sciences’s (GILD) total revenues fell 10% to $7.5 billion.

Gilead Sciences (GILD) holds a share of nearly 80% in the antiretroviral therapy market, which covers ~840,000 patients.

When compared with its estimated $30.2 billion total revenue for 2016, Gilead Sciences’s (GILD) $99 billion market capitalization on November 23 seemed to be at a greater discount. GILD had a forward PE ratio of ~7.0x against its peers’ average PE of ~12.1x.

BMY’s Orencia is the only biologic approved for three modes of administration (IV infusion, prefilled syringes, and autoinjectors) for treating RA.

Opdivo’s significant regulatory advances over the past quarter include approval for head and neck cancer indications, among others.

After its 3Q16 earnings, there were multiple positive triggers for Bristol-Myers Squibb (BMY) stock.

Bristol-Myers Squibb’s (BMY) Opdivo’s will now share the second-line lung cancer therapy market with Roche’s Tecentriq, along with Merck’s Keytruda.

The PD-1 (programmed death-1)/PD-L1 (programmed death-ligand 1) class consists of Bristol-Myers Squibb’s Opdivo, Merck’s Keytruda, and Roche’s Tecentriq.

Despite fierce competition in the lung cancer space, Opdivo is leading with its superior safety and efficacy profile.

During the third quarter of 2016, Bristol-Myers Squibb (BMY) fetched revenues of $4.9 billion—a 21% rise.

The effects of repealing Obamacare Donald Trump is definitely not in favor of the Affordable Care Act, known as Obamacare. As he wants to repeal the act completely and replace it with another policy, the hospital sector fell on November 9, the day after the election. Trump believes that providing healthcare facilities to illegal immigrants costs […]

Trump’s healthcare agenda During his campaign, Trump came up with a seven-point plan for the healthcare industry. In this plan, he proposed to repeal the Affordable Care Act. Although a complete repeal doesn’t seem feasible, if applied, it would definitely take a toll on hospitals and insurance companies. In the next article, we’ll discuss the severity of […]

During 3Q16, Nitropress earned $36 million compared with $35 million in 3Q15.

Over the past five quarters, the Bausch & Lomb business had shown a variation in the margins, where its gross margin fell to 61% in 3Q16 from 67% in 3Q15.

Valeant Pharmaceuticals (VRX) announced its 3Q16 earnings on November 8. On a GAAP basis, Valeant reported a loss of ~$1.2 billion, which reflects a loss of $3.49 per diluted share during the period.

Regeneron Pharmaceuticals (REGN) released earnings for 3Q16 on November 4, 2016.

In fiscal 3Q16, Regeneron Pharmaceuticals (REGN) recorded revenue amounting to $1.2 billion and net product sales amounting to $857 million.

On November 3, 2016, Valeant along with many other generic and Specialty Pharma drug companies plunged.

The consensus 12-month target price for Valeant Pharmaceuticals is $36, which translates to a ~77.3% return potential compared to Valeant’s closing price of $20.3 on November 2, 2016.

With the sale of Salix, Valeant’s adjusted revenues will fall 14.0%. Since Salix is a high-margin business, the sale will adversely impact Valeant’s margins.

The gastrointestinal (or GI) drug market in the United States is expected to grow at a CAGR of 5.0% over a five-year period from 2014 to 2019.

Valeant won the acquisition race for Salix by valuing it at $14.5 billion, inclusive of net debt. In April 2015, Valeant paid $158 per Salix share.

Danish company Novo Nordisk (NVO) released earnings for 3Q16 on October 28, 2016.

Novo’s (NVO) Biopharmaceuticals segment rose 5.2 billion Danish kroner during 3Q16.

During the first nine months of 2016, Novo’s (NVO) new generation portfolio garnered 2.8 billion Danish kroner.

Novo Nordisk’s (NVO) diabetes and obesity care portfolio consists of modern insulin, Victoza, human insulin, new generation insulin, and other diabetes and obesity care products.

Novo’s (NVO) Victoza is a glucagon-like peptide-1 (or GLP-1) therapy for type 2 Diabetes patients.

In the diabetes space, Novo shares the market with Sanofi (SNY), Eli Lilly (LLY), and Merck (MRK).

During 3Q16, Novo’s sales in the US rose 2% in local currency terms to 14.2 billion Danish kroner.

During 3Q16, Novo Nordisk’s (NVO) net sales rose 2.8% to 27.5 billion Danish kroner from 26.8 billion Danish kroner in 3Q15.

Novo Nordisk (NVO) disappointed investors with reported revenues of ~27.5 billion Danish kroner for 3Q16.

BioMarin Pharmaceutical (BMRN) reported its 3Q16 earnings on October 27, 2016. Revenues were $279.9 million, which was lower than Wall Street analysts’ projections.

A Bloomberg survey of two brokerage houses on October 24, 2016, reflected a 50% “buy” rating and a 50% “hold” rating for the stock.

Roche Holding (RHHBY) reported earnings for 3Q16 on October 20, 2016. Wall Street analysts expected Roche to report 12.6 billion Swiss francs in revenue during 3Q16 while the company reported ~12.5 billion Swiss francs.

Once Alexion taps the numbers of Strensiq and Kanuma, its share price will most likely rise.

Following analysts’ projections, Soliris revenues in 3Q16 and 4Q16 should rise 9.0% and 10.0%, respectively, YoY to reach $725.9 million and $760.6 million, respectively.

Although there are 12,000 eligible patients in Europe who are 12 years and older, Orkambi hasn’t yet received reimbursement approvals for these patients.

The slower launch of Orkambi in Germany is to blame for the drug’s lowered guidance.

Over the past year, VRTX stock has fallen 31.0%. But perhaps the entire biotechnology industry, not just Vertex, has suffered during the period.

On October 6, 2016, Pfizer (PFE) announced one deal to “off-load” all of the global infusion therapy business known as “Hospira Infusion Systems.”

Over the past year, Pfizer completed multiple acquisitions to restore its top line growth. They will offset the revenue decline and fuel Pfizer’s top line.

Over the past two years, Pfizer hasn’t really offered lucrative returns to shareholders. The stock rose 13% from October 10, 2014, to October 11, 2016.

Like other big pharmaceutical companies, Pfizer witnessed negative top line growth. With multiple acquisitions recently, it’s poised to grow its top line.

In the US, the Opdivo and Yervoy combination is the most prescribed regimen in first-line metastatic melanoma.

With Bristol-Myers Squibb’s (BMY) Opdivo being the standard of care in the second-line lung cancer space, it faces cutthroat competition from Merck’s (MRK) Keytruda.

Analyst recommendations for BMY Bristol-Myers Squibb (BMY) is a leading immuno-oncology company. According to a Bloomberg consensus of 26 brokerage firms recorded on October 5, 2016, 42.3% of analysts recommended Bristol as a “buy” and 50% of analysts issued a “hold” rating for the company. Around 7.7% of analysts rated the stock as a “sell.” The […]

CheckMate-141 Bristol-Myers Squibb’s (BMY) CheckMate-141 evaluated Opdivo for the treatment of squamous cell carcinoma of the head and neck. The study was stopped after meeting the primary endpoint in January 2016. The drug is under priority review by the FDA with an action date set for November 11, 2016. With similar approved indications, Opdivo and Merck’s (MRK) […]

Bristol-Myers Squibb’s valuation  On October 5, 2016, Bristol-Myers Squibb (BMY) was trading at 12.98x its forward EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) multiple. The valuation multiple was quite close to that of Eli Lilly and Company (LLY), which was trading at 13.04x its forward EBITDA. Peers Celgene (CELG), Roche (RHHBY), […]

On October 4, 2016, Bristol-Myers Squibb (BMY) was trading at a forward PE (price-to-earnings) multiple of 16.8x. With products Opdivo and Yervoy, the company leads the immuno-oncology space.

Although hepatitis C is the most common cause resulting in liver transplants today, NASH (nonalcoholic steatohepatitis) will replace it by 2030.

Simtuzumab is Gilead Sciences’ (GILD) most advanced NASH (nonalcoholic steatohepatitis) anti-fibrotic product.

Gilead Sciences (GILD) recently launched three TAF-based (tenofovir alafenamide) STRs (single-tablet regimens), including Genvoya, Descovy, and Odefsey.

Gilead’ share in the HIV space in terms of overall volume translates to ~78%, whereas 627,000 patients have remained on Gilead’s regimen.

Immuno-oncology has been quite an interesting area with increasing innovation and lot of new developments.

On September 20, 2016, Regeneron Pharmaceuticals (REGN) entered a collaboration agreement with Teva Pharmaceuticals (TEVA).

Regeneron’s (REGN) flagship product, Eylea (Aflibercept), was launched in the US in November 2011.

BioMarin’s (BMRN) early-stage pipeline includes BMN-270, a gene therapy program for hemophilia A and vosoritide, which is indicated for achondroplasia.

BioMarin Pharmaceutical (BMRN) expects its existing commercialized drugs to add $1.1 billion and $1.2 billion to its top line in 2016.

BioMarin’s application for cerliponase alfa, an enzyme replacement therapy, is under review by the FDA for the treatment of CLN2 disease.

The Bloomberg consensus of 24 brokerage firms shows that 66.7% brokerage firms recommend Vertex as a “buy,” while 33.3% analyst issued a “hold” ratings.

The addressable population for Vertex Pharmaceuticals’ (VRTX) two commercialized products Kalydeco and Orkambi is currently 27,000.

Despite a slower launch of the drug in Germany, Orkambi is expected to generate $1 billion–$1.1 billion in 2016.

With products such as Descovy, Odefsey, Genvoya, Stribild, Complera/Eviplera, Atripla and Truvada, Gilead Sciences (GILD) dominates the HIV market.

In January 2012, Gilead Sciences (GILD) acquired Pharmasset and got access to sofosbuvir. In December 2013, the FDA approved sofosbuvir under the brand name Sovaldi.

There are six distinct genotypes of HCV (hepatitis C virus). If we know the genotype, recommending the treatment and duration becomes easier.

On September 20, 2016, Gilead Sciences (GILD) was trading at a forward PE (price-to-earnings) multiple of 7.14x, which was at a discount compared to its peers.

According to Horizon Pharma’s (HZNP) estimates, Procysbi holds a peak sales potential of more than $300 million.