Biogen will set the tone for the actively-traded biotech space. Biogen Third Quarter Earnings Report (Tuesday, October 24, before the open)

Biogen's report will be important for the S&P 500 Health Care sector (the third highest-weighted sector in the S&P 500).

BIIB is a leader in the treatment of multiple sclerosis, investors will be looking closely at sales trends for core drugs like Tecfidera and Tysabri to determine how Biogen is faring amid the intense competition from other bio companies.

The IBB has dropped 3.8% since its high on October 6 and is sitting above of its 50-day MA in front of BIIB's report.

 IBB D

IBB D

TECHS:

Options Volatility:

 BIIB Options Volatility

BIIB Options Volatility

BIIB Puts outpaced Calls at a 1.3x pace going into earnings report with IV sitting at 29%. Options is are pricing an approximate 6% move on the report.

Stocks to Watch:
 

  • IBB:. BIIB is the third-largest holding at 7.91% of assets
  • Primary competitors for Multiple Sclerosis drugs (Tecfidera, Avonex, Plegridy, Tysabri, Zinbryta)*
  • Sanofi (SNY)
  • Teva Pharmaceuticals (TEVA)
  • Bayer Group (BAYRY)
  • Novartis (NVS)
  • Ionis Pharmaceuticals (IONS)
  • Amgen (AMGN)
  • Johnson & Johnson (JNJ)
  • Gilead Sciences (GILD)
  • Bristol-Myers Squibb (BMY)
  • Pfizer (PFE)
  • AmerisourceBergen (ABC)... More than 10% of BIIB's total revenue in 2016
  • McKesson (MCK)... More than 10% of BIIB's total revenue in 2016

RESULTS: Biogen prelim Q3 $6.31 vs $5.73 Capital IQ Consensus Estimate; revs $3.08 bln vs $3.05 bln Capital IQ Consensus Estimate


Biogen beats by $0.58, beats on revs.


  • Reports Q3 (Sep) earnings of $6.31 per share, excluding non-recurring items, $0.58 better than the Capital IQ Consensus of $5.73; revenues rose 4.1% year/year to $3.08 bln vs the $3.05 bln Capital IQ Consensus. 
  • TECFIDERA revenues (+3% to $1.07 bln) comprised $836 million in sales in the U.S. and $233 million in sales outside the U.S. In the third quarter of 2016, U.S. TECFIDERA revenues benefited by ~$40 million to $50 million due to inventory build in the channel, affecting the year over year comparison. Inventory levels in the third quarter of 2017 for TECFIDERA in the U.S. were relatively flat versus the second quarter of 2017. 
  • SPINRAZA (marketed for IONS) revenues (+34% Q/Q to $271 mln) comprised $198 million in sales in the U.S. and $73 million in sales outside the U.S. Inventory levels for SPINRAZA in the U.S. were relatively flat versus the second quarter of 2017, as compared to a $30 million increase in the second quarter of 2017. Outside the U.S., SPINRAZA revenues were primarily from Germany and Turkey.

Ionis Pharma down 13% after Biogen (BIIB -7%) reported Spinraza sales

While Q3 Spinraza sales beat estimates, they were flat Q/Q in the US, which disappointed some investors. BIIB markets SMA drug Spinraza for Ionis,


Biogen makes one-time $150 mln payment to Neurimmune Holding AG in exchange for a 15% reduction in the previously negotiated royalty rates


BIIB -7.18%: Reports Q3 EPS and revenue beats; Biogen (markets SMA drug for IONS) reported Spinraza sales +34% Q/Q to $271 mln, above estimates but flat Q/Q in the U.S.

BIIB -5% with price probing its rising 50-day ma's along 315/316 for the first time since June.

BIIB breaking below 50EMA