Shares of Regeneron (NASDAQ:REGN) gained over 1% in pre-open trading Monday after the FDA on Friday approved EYLEA HD Injection 8 mg for the treatment of patients with wet age-related macular degeneration, diabetic macular edema, and diabetic retinopathy. The approval process for EYLEA HD had been awaiting resolution since the unexpected Complete Response Letter (CRL) issued by the FDA in late June and prompted several Wall Street analysts to raise their price targets.
Following the approval, individuals diagnosed with wet age-related macular degeneration or diabetic retinal disease can now undergo fewer injections after their initial monthly doses, while still attaining comparable visual improvements, anatomical enhancements, and the safety benefits associated with EYLEA.
Peter Kaiser, M.D., Chaney Family Endowed Chair in Ophthalmology Research at the Cole Eye Institute and Professor of Ophthalmology at Cleveland Clinic Lerner College of Medicine, called the news "an important advancement in retinal care." Meanwhile, Allen C. Ho M.D., Director of Retina Research and Co-Director of the Retina Service of Wills Eye Hospital and Professor of Ophthalmology at Thomas Jefferson University, said, "[i]n its clinical trial program, EYLEA HD demonstrated an unprecedented ability to maintain vision with extended dosing intervals, which created an exciting new advancement in the treatment of our patients with serious retinal diseases."
Oppenheimer analysts raised the price target on the stock to $1050 from $950 while reiterating an Outperform rating following the news. "While there have been concerns about competition to Eylea 2mg over the last year, we expect Eylea HD to give REGN's eye franchise its mojo back," they commented. "We currently model flat to lowsingle digit sales growth for the Eylea franchise in 2023 and beyond; assuming midsingle digit sales growth and some earnings leverage going forward materially affects our model to the upside. While we await greater visibility on launch dynamics to update our P&L estimates, we update our PT to $1,050 (from $950) and stay bullish."
Meanwhile, BMO Capital analysts raised their price target to $985 from $960 and also reiterated an Outperform rating. The analysts note the Eylea HD approval comes sooner than expected. "Friday's approval is a significant step for Regeneron to solidify its ophthalmology franchise and could allow for transitioning of new patient starts to Eylea HD ahead of new Eylea biosimilar entrants and increasing competition from Roche's Vabysmo," they commented.
Elsewhere, Wells Fargo raised its price target to $980, RBC to $830, and Barclays to $925.