Regeneron Pharmaceuticals Inc.‘s (REGN) fourth quarter 2010 net loss of 17 cents per share was narrower than the Zacks Consensus Estimate of a net loss of 32 cents. The company suffered a loss of 46 cents per share in the year-ago quarter. The narrower loss was attributable to higher revenues which more than offset the rise in operating expenses.
Quarterly Results in Detail
Total revenue in the reported quarter climbed 38.1% to $133.7 million. Revenues comfortably surpassed the Zacks Consensus Estimate of $120 million. Total revenues included collaboration revenue, technology licensing revenue, net product sales and contract research and other revenue.
The rise in total revenue came on the back of higher revenues in the reported quarter from Regeneron’s antibody collaboration with Sanofi-Aventis (SNY). Moreover, the recognition of a $20 million substantive milestone payment from Bayer (BAYRY) also contributed to the increase. Collaboration revenues climbed 45.3% to $117.1 million in the final quarter of 2010.
Revenues from technology licensing, arising out of Regeneron’s license agreements with AstraZeneca (AZN) and Astellas, remained flat at approximately $10 million. Net product sales from the company’s only marketed product, Arcalyst, approved for treating cryopyrin-associated periodic syndromes, climbed 6% to $5.3 million. Revenues from contract research and others accounted for the balance in the reported quarter.
Both research and development (R&D) expenses (up 5.4%) and selling, general and administrative (SG&A) expenses (up 21.2%) were on the upswing during the reported quarter. Total operating expenses in the quarter climbed 7.6% to $146.5 million.
The rise was primarily attributable to the higher R&D expenses incurred in connection with the efforts to develop the pipeline at Regeneron and the higher employee headcount in connection with the antibody collaboration with Sanofi.
Annual Results
For full year 2010, Regeneron suffered a loss of $1.26 per share which was 15 cents narrower than the loss projected according to the Zacks Consensus Estimate but 41 cents wider than the 2009 loss.
2010 revenues at Regeneron climbed 21% to $459.1 million. Annual revenues comfortably surpassed the Zacks Consensus Estimate of $445 million. Operating expenses climbed 22.8% to $556.6 million in 2010. Both R&D expenses (up 22.7%) and SG&A expenses (up 24.7%) contributed to the increase.
Our Recommendation
Currently, we have a Neutral recommendation on Regeneron, which is supported by a Zacks #3 Rank (short-term Hold rating).
ASTRAZENECA PLC (AZN): Free Stock Analysis Report
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SANOFI-AVENTIS (SNY): Free Stock Analysis Report
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