Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Celgene (CELG) Tops On Q1 Earnings, Sales Miss, Raises View

Published 04/26/2017, 11:11 PM
Updated 07/09/2023, 06:31 AM

Celgene Corporation (NASDAQ:CELG) reported first-quarter 2017 earnings of $1.53 per share (including share-based compensation expense and tax adjustments), beating the Zacks Consensus Estimate of $1.47 but up from $1.18 per share in the year-ago quarter.

Celgene’s share price movement shows that the stock outperformed the Zacks classified Medical-Biomedical and Genetics industry in the past year. Specifically, the stock gained 13.8.% during this period, compared with a decline of 8.6% for the industry.

Excluding share-based compensation expense, Celgene’s earnings climbed approximately 27.3% year over year to $1.68 in the reported quarter.

Total revenue grew 17.8% to $2.96 billion in first-quarter 2017. Revenues were boosted by consistently strong performance of the company’s key growth driver, Revlimid. However, revenues were below the Zacks Consensus Estimate of $3.04 billion.

Revlimid Continues to Shine

Net product sales increased 18.2% year over year to $2.95 billion. Net sales of Revlimid came in at $1.9 billion, reflecting a year-over-year increase of 19.7%. The drug did well in the U.S. (up 23.8%). Growth in the reported quarter was driven by increased volume as a result of increases in duration and market share.

Net sales of another cancer drug, Abraxane increased 4.9% to $236 million as sales in the U.S. declined 1.4% but increased 16% internationally. Sales of oncology drug, Pomalyst/Imnovid, came in at $364 million, up 32.8%. Sales were driven by increased volume from duration gains.

Newly launched Otezla reported sales of $242 million in the reported quarter, up 23.5% driven by market share gains in the U.S. and continued launches in international markets.

All other product sales (including Istodax, Thalomid, Vidaza and an authorized generic version of Vidaza in the U.S.) totaled $224 million in the reported quarter, roughly flat.

Adjusted research and development expenses inched up 0.7% to $595 million, while adjusted selling, general and administrative expenses increased 15.2% at $539 million.

2017 Outlook Updated

For 2017, Celgene now expects earnings around $7.15–$7.30, compared to the earlier forecast of $7.10–$7.25 per share. The Zacks Consensus Estimate for earnings is $6.59. Net product sales are still expected around $13.0–$13.4 billion.

Revlimid sales are projected between $8 billion–$8.3 billion. Abraxane sales are estimated to be around $1 billion. While Pomalyst’s revenues are projected around $1.6 billion, the same for Otezla are estimated around $1.5 billion– $1.7 billion.

Our Take

Celgene’s first-quarter results were mixed, with the company beating on earnings but missing on sales. Nevertheless, Revlimid continued to outperform in the quarter. Other key products – Pomalyst/Imnovid, Abraxane and Otezla – also performed well. The increase in earnings guidance for 2017 was encouraging.

Meanwhile, the company continues to progress with its label expansion efforts and pipeline development. Revlimid was approved as a single agent for maintenance therapy in adult patients with newly diagnosed multiple myeloma (NDMM) following autologous stem-cell transplantation (ASCT) both in the U.S. and EU.

Celgene submitted a New Drug Application (NDA) to the FDA for Idhifa (enasidenib) in relapsed and/or refractory acute myeloid leukemia (AML) with isocitrate dehydrogenase 2 (IDH2) mutation. The NDA was granted Priority Review with a Prescription Drug User Fee Act (PDUFA) action date of Aug 30, 2017. Celgene has a collaboration agreement with Agios Pharmaceuticals, Inc (NASDAQ:AGIO) for the candidate.

Zacks Rank & Key Picks

Celgene is a Zacks Rank #3 (Hold) stock.

Better-ranked stocks in the health care sector include Grifols, S.A. (NASDAQ:GRFS) and Infinity Pharmaceuticals, Inc. (NASDAQ:INFI) . Both Grifols and Infinity sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Grifols' earnings estimates increased 10.6% for 2017 over the last 60 days. The company’s shares have appreciated 31.4% so far this year.

Shares of Infinity have gained 58.5% this year so far, while the company’s loss estimates for 2017 narrowed almost 6% in the past 60 days.

The Best & Worst of Zacks

Today you are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. From 1988 through 2015 this list has averaged a stellar gain of +25% per year. Plus, you may download 220 Zacks Rank #5 "Strong Sells." Even though this list holds many stocks that seem to be solid, it has historically performed 6X worse than the market. See these critical buys and sells free >>



Agios Pharmaceuticals, Inc. (AGIO): Free Stock Analysis Report

Celgene Corporation (CELG): Free Stock Analysis Report

Grifols, S.A. (GRFS): Free Stock Analysis Report

Infinity Pharmaceuticals, Inc. (INFI): Free Stock Analysis Report

Original post

Zacks Investment Research

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.