BioMarin Pharmaceutical Inc.’s (BMRN) first quarter 2010 earnings of 8 cents per share (excluding special items), easily surpassed the Zacks Consensus Estimate of break-even earnings. The company earned 9 cents per share (excluding special items) in the year-ago quarter.
Total revenues in the reported quarter climbed 14.8% year-over-year to approximately $85 million. The increase in the quarter was driven by strong sales of its enzyme replacement therapies.
Total net product revenues increased to $84.1 million from $71.9 million in the first quarter of 2009. Royalty and license revenues in the quarter slipped to $0.7 million from $1.6 million in the year-ago quarter. Revenues from collaborative agreements accounted for the remaining total revenues in the reported quarter.
Revenues from Naglazyme in the reported quarter leaped 23% year-over-year to $48.6 million. Naglazyme is an enzyme replacement therapy for treating mucopolysaccharidosis VI, a rare genetic enzyme deficiency disorder.
Revenues from Aldurazyme recorded by Genzyme Corp. (GENZ) who sells the drug, an enzyme replacement therapy for treating mucopolysaccharidosis I, climbed 8% year-over-year to $39.9 million. Changes in foreign currency rates caused Aldurazyme sales to increase $1.7 million in the reported quarter.
Net product revenues for BioMarin from Aldurazyme slipped to $14.2 million in the reported quarter from $17 million in the first quarter of 2009. Net product revenues from Kuvan tablets, for treating mild-to-moderate forms of the genetic disease phenylketonuria, grew 37% year-over-year to $21.2 million. However, the demand for Kuvan tablets in the reported quarter declined 7% sequentially.
In addition to the three marketed products, BioMarin possesses the rights to Firdapse through the acquisition of Huxley Pharmaceuticals in October 2009. Firdapse (Amifampridine phosphate) is indicated for treating Lambert Eaton Myasthenic Syndrome (LEMS), a rare autoimmune disease. Net revenues from Firdapse were negligible in the quarter but are expected to pick up in the coming quarters. Firdapse sales are expected in the range of $10 million-$15 million for the entire year.
The company launched the LEMS drug in the European Union last month, starting with Germany and the UK . The drug is expected to be launched in other major European markets by the end of the year.
Operating expenses rose 4.8% year-over-year to $82.2 million in the reported quarter. BioMarin exited the quarter with approximately $109 million in cash and cash equivalents.
2010 Outlook
The company reaffirmed the guidance it had previously provided for 2010. BioMarin expects to end 2010 with a net income (excluding special items) between $39 million and $49 million. The Zacks Consensus Estimate for 2010 hints at earnings of 8 cents per share. Total revenues in 2010 are projected between $374 million and $405 million. Total net product revenues in 2010 are expected to range between $368 million and $398 million.
Our Take
Currently, we have a Neutral outlook on BioMarin. Even though we are pleased with the acquisition of Huxley Pharmaceuticals, which has added Firdapse to its product portfolio, we remain concerned about the less than impressive growth rate of the company’s first approved product Aldurazyme.
However, we believe that the company’s other two marketed products Naglazyme and Kuvan, will continue performing well in the coming quarters.
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