Regeneron Pharmaceuticals Inc.‘s (REGN) third quarter 2010 net loss of 41 cents per share was wider than the Zacks Consensus Estimate of a net loss of 34 cents. The company suffered a loss of 1 cent per share in the year-ago quarter. The wider loss was attributable to lower revenues and higher expenses incurred in the reported quarter.

Total revenue in the reported quarter declined 9.8% to $106 million. Revenues fell well short of the Zacks Consensus Estimate of $114 million. Total revenues included collaboration revenue, technology licensing revenue, net product sales and contract research and other revenue.

The fall in total revenue was mainly attributable to the receipt of a $20 million substantive milestone payment from Bayer HealthCare in the year-ago quarter, partly mitigated by higher revenue in the reported quarter from the company’s antibody collaboration with Sanofi-Aventis (SNY). Collaboration revenues declined 11.3% to $89.3 million in the third 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, were flat at $4.9 million. Revenues from contract research and others accounted for the balance in the reported quarter.

Both research and development (R&D) expenses (up 15.8%) and selling, general and administrative expenses (up 21.9%) were on the upswing during the reported quarter. Total operating expenses in the quarter climbed 16.3% to $138.1 million.

The rise was primarily attributable to the higher R&D expenses incurred in connection with the higher employee headcount at Regeneron and the expanding R&D activities in connection with the antibody collaboration with Sanofi.

Currently we have a Neutral stance on Regeneron with the company enjoying a short- term Zacks #3 Rank (short-term Hold rating) on the stock.

 
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