Biogen, a leading biotechnology company, recently reported a decline in revenue and profit for the fourth quarter of the year. This drop can be attributed to various factors, including expenses related to the withdrawal of its controversial Alzheimer’s drug Aduhelm and decreasing sales of its multiple sclerosis treatments.
The company’s revenue for the quarter amounted to $2.39 billion, marking a 6% decrease compared to the same period last year. Net income also saw a significant decline, falling from $550.4 million to $249.7 million. These numbers were adjusted for one-time items, with the company reporting earnings per share of $2.95.
One of the main culprits behind Biogen’s declining revenue is the withdrawal of Aduhelm. The drug faced polarizing approval and rollout in the U.S., resulting in charges associated with its discontinuation. As Biogen cuts costs, it is placing its hopes on other Alzheimer’s drugs, including its highly anticipated treatment Leqembi, as well as other newly launched products, to compensate for the revenue lost from multiple sclerosis therapies.
The decline in revenue from multiple sclerosis products is another contributing factor to Biogen’s financial struggles. Sales of these treatments decreased by 8% in the fourth quarter, reaching $1.17 billion. This can be attributed to increased competition from cheaper generic alternatives. Tecfidera, once a blockbuster drug for Biogen, saw its revenue fall by 17.8% to $244.3 million.
Biogen’s rare disease drugs, on the other hand, experienced a 3% increase in sales, reaching $471.8 million. Spinraza, a medication used to treat spinal muscular atrophy, generated $412.6 million in sales. Although slightly below analysts’ estimates, the drug continues to be a significant revenue driver for the company.
Looking ahead, Biogen issued full-year 2024 guidance that predicts adjusted earnings of $15 to $16 per share. This is slightly lower than analysts’ expectations, which were set at $15.65 per share. The company anticipates a low to mid-single digit percentage decline in sales for 2024, but it expects its pharmaceutical revenue to remain flat compared to 2023.
Despite the challenges Biogen is facing, there are some promising developments on the horizon. The company’s recently launched drug, Leqembi, has shown potential in slowing the progression of Alzheimer’s disease. However, its adoption rate has been slow, with only around 2,000 patients currently using the treatment. Biogen aims to reach 10,000 patients by the end of March 2024, although CEO Christopher Viehbacher emphasized the company’s focus on long-term reach rather than meeting short-term benchmarks.
Investors are also keeping an eye on other newly launched drugs from Biogen, such as Skyclarys, which is used to treat Friedreich ataxia, and Zurzuvae, a pill for postpartum depression. These drugs have the potential to contribute to the company’s growth in the future.
In conclusion, Biogen’s recent financial report indicates a decline in revenue and profit, primarily due to expenses related to Aduhelm and decreasing sales of multiple sclerosis treatments. However, the company remains optimistic about its future prospects, placing its hopes on other Alzheimer’s drugs and newly launched products. Biogen will need to navigate these challenges carefully and focus on innovation and expansion to regain its financial stability.
