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Eylea may not be Regeneron Pharmaceuticals' (Nasdaq: REGN  ) first drug, but it's the biotech's best chance at making it to profitability. Arcalyst, which treats an ultra-orphan indication, brought in about $20 million last year; Eylea hit the gates running with sales of about $24 million in just over a month after being approved in November.

That's pretty impressive considering the age-related macular degeneration market that Regeneron had to enter. Eylea can be dosed less than half as often as Roche's Lucentis, which is a big deal for a drug that has to be injected into the eye. But Roche's cancer drug Avastin is used off-label at about a 40th the cost. To counteract that, Regeneron undercut Lucentis by offering Eylea at less than half the cost of the entrenched leader.

The strategy seems to have paid off. Getting doctors excited about a new drug seems to be half the battle with launches these days. Pent-up demand isn't enough; there hadn't been a drug approved for lupus in 50 years until Human Genome Sciences' (Nasdaq: HGSI  ) Benlysta came along, but sales of the drug haven't taken off yet.

While the Eylea launch is going well, don't expect it to be an instant blockbuster like Vertex Pharmaceuticals' (Nasdaq: VRTX  ) Incivek, which brought in an unbelievable $420 million in its first full quarter on the market. Incivek has essentially no competition in the hepatitis C market; it's used in combination with the established treatments, and its efficacy is substantially better than Merck's (NYSE: MRK  ) Victrelis that was approved at the same time. Management thinks Eylea can bring in $140 million to $160 million in sales this year, although I'd guess that's a conservative estimate and they're hoping for more.

This year's sales aren't enough to justify Regeneron's $7 billion market cap on their own. The rest of the value is tied up in the potential for Eylea -- Lucentis is a $2 billion product -- and its pipeline. Arcalyst is under FDA review for gout, which should boost the current paltry sales, and an application for its colorectal cancer drug, Zaltrap, is expected to be submitted shortly.

Eylea could get Regeneron to profitability on its own, but it'll be much easier with another drug and an expanded indication for Arcalyst.

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Fool contributor Brian Orelli holds no position in any company mentioned. Click here to see his holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Vertex Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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