Jazz Pharmaceuticals (JAZZ -0.23%) hasn't given investors much good news so far in 2020. The drugmaker's first-quarter results announced in May were disappointing. Jazz stock has dropped 23% year to date.
But Jazz appears to be hitting more right notes now. The company announced its second-quarter results after the market closed on Tuesday. Here are the highlights from Jazz's Q2 update.
By the numbers
Jazz reported revenue in the second quarter of $562.4 million. This reflected a 5% increase from the prior-year period revenue total of $534.1 million. It also easily beat the consensus Wall Street Q2 revenue estimate of $504.65 million.
The company announced Q2 net income of $114.8 million, or $2.06 per share, based on generally accepted accounting principles (GAAP). This represented a decline from GAAP earnings of $261.9 million, or $4.56 per share, posted in the prior-year period.
On a non-GAAP adjusted basis, Jazz's net income in the second quarter totaled $207.3 million, or $3.71 per share. This reflected deterioration from adjusted earnings of $232.5 million, or $4.05 per share, recorded in the same quarter of 2019. However, Jazz topped the average analysts' adjusted earnings estimate $3.11 per share.
Behind the numbers
Xyrem remains the most important drug for Jazz right now. The good news for the company was that sales for the narcolepsy drug increased 8% year over year to $446.8 million.
Jazz reported even stronger growth for two other products. Sales for narcolepsy drug Sunosi, which launched in the U.S. in July 2019, soared to $8.6 million from $1.9 million in the prior-year period. Sales for leukemia drug Erwinaze/Erwinase jumped 18% year over year to $32.7 million.
There were a couple of problem areas in Q2, though. Net product sales for veno-occlusive disease drug Defitelio/defibrotide fell 7% year over year to $42.7 million in Q2. Sales for leukemia drug Vyxeos also sank 15% to $26.6 million. The culprit behind sales declines for both drugs was the COVID-19 pandemic. However, Jazz saw improvement in demand for the two drugs late in the second quarter.
Another key development for Jazz in Q2 didn't show up in the details of its financial results. The company won FDA approval for Zepzelca in June for treating metastatic small cell lung cancer. Jazz launched the drug in the U.S. in July.
Jazz now anticipates revenue in full-year 2020 will be between $2.225 billion and $2.325 billion, up from its previous guidance of $2.12 billion to $2.26 billion. The company also projects 2020 GAAP earnings per share (EPS) will between $3.40 and $4.85, up from its previous forecast of a range of $2.70 to $4.30. Adjusted EPS is expected to come in between $11.90 to $13.00, compared to a range of $11.25 to 12.50 provided in the previous outlook.
Perhaps the most important potential catalysts for the biotech stock are the five key product launches expected throughout the rest of 2020 and into 2021. These include the European rolling launch of Sunosi, the U.S. launch of Zepzelca, and the U.S. launch of Zywav this year.