BioMarin Pharmaceutical Inc. (BMRN) delivered a strong third-quarter performance, exceeding analysts’ expectations on both earnings and revenue. The company reported adjusted earnings per share (EPS) of 91 cents, nearly double the 46 cents reported a year ago, and surpassing the consensus estimate of 52 cents. Revenue also came in higher than anticipated, reaching $745.74 million compared to the consensus estimate of $700.14 million, marking a 28% increase year-over-year. This robust growth was driven by strong contributions from Voxzogo, BioMarin’s treatment for achondroplasia, a rare bone growth disorder, fueled by new patient starts across all regions.
Revenue from BioMarin’s Enzyme Therapies, which include Vimizim, Naglazyme, Aldurazyme, Brineura, and Palynziq, also saw a significant increase, rising 27% year-over-year.
BioMarin remains confident in its long-term outlook, reaffirming its revenue target of approximately $4 billion by 2027. The company expects a 40% adjusted operating margin starting in 2026, with projections for this margin to grow to the low-to mid-40% range over time.
Despite the positive financial performance, analysts remain cautious about BioMarin’s future prospects. William Blair downgraded its rating for BioMarin to “Market Perform,” citing concerns about the company’s current valuation reflecting the full potential of its commercial portfolio. The analyst believes that BioMarin’s clinical pipeline is unlikely to drive significant value creation in the near term. William Blair forecasts revenue of $2.8 billion in 2024 and $3.1 billion in 2025.
Voxzogo, while a key driver of BioMarin’s topline growth, is facing increasing competitive pressure. Ascendis Pharma’s (ASND) navepegritide, a long-acting CNP, demonstrated potential to deliver similar efficacy as Voxzogo with a more attractive once-weekly dosing in a recent trial for achondroplasia. This development poses a significant threat to Voxzogo’s market share and future revenue growth. While Voxzogo’s label may expand, William Blair anticipates a limited increase in the total addressable patient population until 2030.
Although BioMarin has a robust pipeline, analysts do not see data readouts from its early-stage programs over the next year as major value drivers. Only two programs are expected to contribute to BioMarin’s top line through label expansions by 2027: Palynziq for adolescent Phenylketonuria (PKU) patients and Voxzogo for Hypochondroplasia (HCH).
Analyst reactions to BioMarin’s Q3 results were mixed:
* Baird maintained its “Outperform” rating for BioMarin but lowered its price target from $72 to $65.
* UBS reaffirmed its “Buy” rating, raising the price target from $104 to $106.
* Evercore ISI maintained its “Outperform” rating but reduced its price target from $115 to $105.
* RBC Capital reiterated its “Sector Perform” rating with a price target of $80.
BioMarin’s stock price closed down 3.1% at $67.74 on Wednesday.
