We recently upgraded our recommendation on BioMarin Pharmaceutical Inc. (BMRN) to Neutral from Underperform owing to the impressive sales of the company’s key drugs and diversified pipeline.
Even though BioMarin suffered a wider loss in the fourth quarter of 2011, due to higher operating expenses, the key products of the company, namely Naglazyme and Kuvan, continued to perform well. Total revenue climbed 6.1% to $107.8 million in the final quarter of 2011.
Expecting the trend to continue, BioMarin is forecasting an increase in 2012 revenues compared to 2011. Total revenue is expected in the range of $465 million-$510 million, up from $441 million in 2011. The increase is due to higher product sales expected in 2012. Net product revenue is expected in the range of $460 million-$505 million, well above $438 million in 2011. We expect BioMarin to easily achieve the revenue guidance driven by Naglazyme and Kuvan. Our 2012 revenue estimate is well within the company’s guidance range.
The marketed products at BioMarin are Aldurazyme (co-marketed with Sanofi (SNY)), Naglazyme, Kuvan and Firdapse. Aldurazyme is marketed for the treatment of MPS-I (mucopolysaccharidosis). Naglazyme is marketed for treating MPS-VI, a rare genetic enzyme deficiency disorder. Kuvan is marketed for treating patients suffering from phenylketonuria (PKU). Firdapse, added to BioMarin’s portfolio through the October 2009 acquisition of Huxley Pharmaceuticals, was launched in the EU in April 2010 for treating patients suffering from Lambert Eaton Myasthenic Syndrome (LEMS) – a rare autoimmune disorder.
Moreover, we are pleased by the company’s efforts to develop its pipeline with multiple pipeline events lined up. Positive news regarding the pipeline would boost the stock. These catalysts have induced us to upgrade the stock to Neutral.
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