BioMarin Q3 Loss Narrower than Expected, View Raised
BioMarin Pharmaceutical Inc.’s (BMRN) third-quarter 2014 loss of 16 cents per share was much narrower than the Zacks Consensus Estimate of a loss of 22 cents but wider than the year-ago loss of 12 cents per share. The narrower-than-expected loss was primarily due to higher revenues, driven by strong Vimizim sales.
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Total revenues climbed 32.2% to $177.1 million in the reported quarter but failed to beat Zacks Consensus Estimate of $198 million. The year-over-year increase was attributable to higher net product revenues.
The Quarter in Detail
Vimizim contributed $25.2 million to total revenues in the third quarter of 2014.
Net product revenues from Kuvan were up 22.5% to $53.4 million. The impressive rise was due to higher demand for the drug. BioMarin had launched Kuvan in powder form for oral solution earlier in the year. The launch of the new formulation also contributed to sales growth.
Naglazyme sales in the quarter increased 6.8% year over year to $67.5 million.
BioMarin receives royalties from its partner Sanofi (SNY) on Aldurazyme. Aldurazyme royalties (excluding transfer revenues) amounted to $22.9 million in the third quarter, up 11.7% year over year.
Firdapse revenues came in at $4.7 million, up 14.6% year over year.
Both research & development (R&D) expenses (up 42.7%) and selling, general & administrative (SG&A) expenses (up 20.6%) were steeper during the quarter. BioMarin’s efforts to develop its pipeline led to the increase in R&D expenses. Costs associated with the marketing of Vimizim pushed up SG&A expenses.
Ups View Again
BioMarin upped its earnings guidance for 2014 yet again. BioMarin now expects total revenues in the range of $700 million to $710 million (old guidance: $680 million to $700 million).
The raised outlook reflects the continued strong performance of Vimizim and updated expectations.
Naglazyme revenues are still expected in the range of $305 million to $320 million. The company expects Kuvan net product sales in the range of $190 million to $200 million (old guidance: $180 million to $200 million). The company projects 2014 Vimizim sales in the range of $65 million to $70 million (old guidance: $60 million to $70 million).
SG&A guidance remains unchanged at $280 million to $295 million. The company lowered its R&D guidance to the range of $455 million to $470 million (old guidance: $460 million to $480 million).
BioMarin lowered its net loss guidance to $50 million to $65 million (old guidance: $60 million to $80 million). The guidance reflects higher revenues and lower R&D expenses.
The U.S. adoption of Vimizim as well as uptake in the EU has been promising, even surpassing the company’s expectation.
BioMarin expects multiple pipeline related news in 2015. Successful pipeline development at the company will drive long-term growth.
BioMarin carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the health care sector include Medivation, Inc. (MDVN) and Illumina Inc. (ILMN). Both carry a Zacks Rank #1 (Strong Buy).
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