This Drug Could be the Most Crucial in Regeneron's Massive Pipeline

This Drug Could be the Most Crucial in Regeneron's Massive Pipeline
August 23, 2017
By Mark Terry, Breaking News Staff

Regeneron Pharmaceuticals is currently a stock investors and analysts are taking a closer look at. It has a Zacks’ “Strong Buy” rating, and Zacks Equity Research notes, “So if you are looking for a stock flying under-the-radar that is well-equipped to bounce down the road, make sure to consider Regeneron Pharmaceuticals. Solid estimate revisions and an impressive Zacks Rank suggest that better days may be ahead for Regeneron and that now might be an interesting buying opportunity.”

Kristine Harjes and Todd Campbell recently spoke on the Motley Fool’s Industry Focus: Healthcare podcast about Regeneron’s research-and-development efforts and why the company’s pipeline is so interesting.

First off, the company has a large pipeline, or what Harjes calls “humongous.” The pipeline has 17 drugs in it, five of which are in Phase III clinical trials. Some are for label extensions for already-approved drugs, such as for Eylea for eye care and Dupixent for asthma. Harjes says, “They’re also looking at Praluent in hypercholesterolemia, so expanding that indication to a wider set of people. But they also have completely novel candidates that they’re studying.”

Those include Fasinumab for osteoarthritis pain and chronic lower back pain. But the real focus is on its cancer drug, REGN2810, a PD-1 inhibitor. It is being evaluated in a Phase III trial in non-small cell lung cancer, which began in this year’s second quarter. It is also in a pivotal Phase II trial in basal cell carcinoma. Harjes says, “Because of the mechanism of action, it could absolutely be possible for this drug to treat a variety of different cancers, and could seriously rack up some sales there.”

Campbell agrees, noting that the two top-selling PD-1 antagonists, Opdivo and Keytruda, have combined sales of over $2 billion per quarter. “Obviously,” Campbell says, “this is a huge market that could be targeted. What companies like Regeneron are doing, they’re a little bit late to the dance, they’re looking for indications that are under-treated where they can get fast-track and early accelerated approval, so they can play a little bit of catch-up. So they’re smaller indications, but they can get to the market quicker, and then they can file for supplemental approvals after that on a little bit more of an expedited time frame so they start to generate some sales.”

He notes that the trial for cutaneous squamous cell carcinoma, the second most common form of skin cancer, is expecting a data readout soon from its Phase II trial. “If that’s good, they think they can file for approval within the next 12 months. So theoretically, depending on if they get fast-tracked or not, you could have this PD-1 drug hitting the market in, we’ll call it 18 months.”

And that’s just one big catalyst. Between now and the end of next year, there are numerous readouts or FDA filings scheduled. The company also has a collaboration with Paris-based Sanofi (SNY) for many of its drugs. It also has a partnership with Bayer on Eylea. However, Sanofi is ending its partnership with Regeneron on antibody development at the end of this year.

Campbell points out the end of some of the Sanofi partnerships could mean a cut in revenue, although it should be minor unless there are problems with some of its smaller drugs like Kevzara. However, he says, “This is a financially stable, fast-growing company. Their earnings are growing quicker than Celgene’s, for example, year over year. They have a lot going on. I think it’s worth having on people’s radar.”

is currently trading for $477.22.

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