(Reuters) – A quicker-than-expected U.S. approval for Regeneron Pharmaceuticals’ high-dose eye disease drug, Eylea, should help return the blockbuster treatment back to growth in the next few years, Wall Street analysts said.
The U.S. Food and Drug Administration approved the newer version of the drug on Friday, a few weeks ahead of schedule. In June, the agency had declined to approve it due to manufacturing issues at contract manufacturer Catalent.
The higher dose of the drug was approved for the same diseases as the previous version, wet age-related macular degeneration, diabetic macular edema and diabetic retinopathy.
A longer dosing gap for the drug could help Regeneron take on rival Roche’s Vabysmo and also help soften the blow from incoming cheaper copycat drugs, analysts said.
Shares of Regeneron rose 1.7% to $826.4 in early trading.
The approval does not, however, eliminate all concerns around competition, but it does minimize the hit to Regeneron that has new intellectual property and potential regulatory exclusivity around the higher-dose version, BMO analyst Evan Seigerman said.
“We feel like this approval … still could not come soon enough. We believe now that this franchise is well positioned to return to growth,” Piper Sandler analyst Christopher Raymond said.
Regeneron priced the drug at $2,625 per single-use vial, which at least four analysts said was above their expectations. The price represents a roughly 20% premium to Roche’s Vabysmo.
Analysts also said Regeneron could switch over patients taking the standard dose to the high-dose version, which would be protected by patents, and cushion the impact from cheaper biosimilar drugs expected for the standard dose in 2024.
While Eylea’s sales have fallen for the past few quarters, Regeneron’s shares trade at 19.1-times their 12-month forward earnings estimates, higher than 10.8 for rival biotech firm Gilead and 13.6 for AbbVie.
(Reporting by Manas Mishra and Khushi Mandowara in Bengaluru; Editing by Shinjini Ganguli)
