Biogen Exceeds Estimates with Cost Reductions and New Therapies, Yet Profit Outlook Falls Short

On Wednesday, Biogen announced its fourth-quarter results, revealing that revenue and profits exceeded expectations. The company attributed these positive figures to successful cost management and growth in new products, particularly its innovative Alzheimer's medication, Leqembi.

Despite this success, Biogen's guidance for the upcoming year did not meet the expectations set by Wall Street. For the full year 2025, Biogen projected adjusted earnings of $15.25 to $16.25 per share, which was lower than the $16.34 per share that analysts had anticipated.

Biogen also indicated that it sees a "mid-single digit" percentage decline in revenue for 2025 compared to the previous year. This expected drop is largely linked to decreasing sales of its multiple sclerosis products, as these therapies are facing increased competition from generics.

However, the company is optimistic about its ability to mitigate these losses. Biogen is counting on the revenue generated from Leqembi, as well as new treatments targeted at rare diseases and depression, to offset the anticipated decline.

During the fourth quarter, Leqembi generated $87 million in revenue, including $50 million from U.S. sales. This surpassed analysts' expectations, which had forecasted sales of around $67 million.

Leqembi, co-developed with Japanese pharmaceutical company Eisai, became the second drug approved in the U.S. in 2023 that claims to slow the progression of Alzheimer's disease. The rollout of Leqembi has been gradual due to various logistical challenges, such as the required diagnostic tests and brain scans.

Biogen’s reported figures compared to Wall Street expectations include:

• Earnings per share: $3.44 adjusted vs. $3.35 expected
• Revenue: $2.46 billion vs. $2.40 billion expected

Overall, Biogen’s revenue of $2.46 billion for the quarter represented an approximate 3% increase compared to the same period last year. The company also posted a net income of $266.8 million, or $1.83 per share, which was an increase from $249.7 million, or $1.71 per share, in the prior year.

After adjusting for one-time charges and other costs, Biogen reported earnings of $3.44 per share.

Biogen has been implementing a cost-cutting initiative initiated in 2023 and anticipates that these reductions will lead to $1 billion in gross savings by the end of 2025.

In a separate announcement, Royalty Pharma stated that it would provide Biogen with $250 million in research and development funding for litifilimab, which is under investigation for treating lupus. Royalty Pharma will receive a share of any regulatory milestones and royalties linked to the drug.

Sales from New Treatments

Another new drug, Skyclarys, achieved sales of $102 million in the fourth quarter, nearly doubling its results from the previous year. Analysts had projected about $112 million in sales for Skyclarys.

Skyclarys was introduced to the market following Biogen's acquisition of Reata Pharmaceuticals in July 2023. The drug received FDA approval in 2023, making it the first-ever approved treatment for Friedreich's ataxia, a rare genetic disorder affecting coordination and walking abilities starting from age five.

Additionally, Zurzuvae, recognized as the first pill for postpartum depression, recorded sales of $22.9 million in the fourth quarter, falling short of the anticipated $26 million.

Amid these developments, sales from Biogen's multiple sclerosis treatments declined by 8% in the second quarter, totaling $1.07 billion.

Biogen, Leqembi, Earnings