The year 2020 has been a roller coaster for investors. The market crashed after the COVID-19 pandemic took hold in late March, and while it has recovered nicely since then, many stocks remain in the negative (or with modest gains) on the year.

However, some companies have consistently performed well since the year started, and healthcare giant Regeneron Pharmaceuticals (REGN 1.48%) is one. 

REGN Chart

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There are several reasons why the biotech has outperformed the market of late, including its promising coronavirus-related efforts and its good financial results. Can Regeneron maintain its momentum? I think so, and here's why. 

Regeneron's COVID-19 program

Regeneron is currently developing an antibody cocktail called REGN-COV2 to treat and prevent COVID-19. Antibodies are proteins that defend healthy cells from pathogens. The company recently reported positive results from a phase 1/2/3 clinical trial for this candidate. According to Regeneron, REGN-COV2 reduced viral load (the amount of virus in a person's blood), and it also helped relieve COVID-19 symptoms faster in non-hospitalized patients. Finally, REGN-COV2 helped reduce medical visits.

These results are promising, and given that REGN-COV2 is being developed to both treat and prevent coronavirus, it could make serious headway in the market if it ends up earning regulatory approval. The antibody cocktail is also undergoing a phase 3 clinical trial in the U.K., where researchers are evaluating its effect (in combination with standard of care) on mortality, hospital stays, and the need for ventilation in hospitalized COVID-19 patients.

In yet another phase 3 clinical trial for REGN-COV2 in the U.S., Regeneron is investigating the candidate's ability to prevent infection in those who have been in close contact with COVID-19 patients.

Doctor holding a piggy bank.

Image source: Getty Images.

Regeneron was hoping Kevzara -- an already approved treatment for rheumatoid arthritis (RA) -- would be effective in treating the novel coronavirus. In collaboration with Sanofi, the biotech ran a phase 3 clinical trial for the RA drug (in combination with supportive care) as a potential treatment for COVID-19 patients requiring mechanical ventilation. However, Kevzara failed to meet its primary and secondary endpoints during the trial.

Recent financial results 

Regeneron's best-selling product remains Eylea, a treatment for wet age-related macular degeneration. During its second quarter, which ended on June 30, the company reported net sales of $1.8 billion from this product. That represented a 6% year-over-year decrease, which the company attributed to the COVID-19 pandemic. Thankfully, Regeneron is generating healthy revenue growth from other sources. During the second quarter, sales of atopic dermatitis treatment Dupixent jumped by 70% year over year to $945 million.

Meanwhile, cancer treatment Libtayo recorded sales of $80 million, 96% higher than the prior-year quarter. And while Kevzara may have been a flop as a COVID-19 treatment, the RA medicine is far from being a dead weight on Regeneron's top line. During the second quarter, the company's sales from Kevzara came in at $68.3 million, 17% higher than the year-ago period. Regeneron reported total revenue of $1.95 billion during the quarter, a 24% year-over-year increase. Non-GAAP net income also grew by 24% to $854 million. Overall, it was a solid quarter for the biotech. 

Looking forward

Regeneron is currently running more than two dozen clinical trials, including nine phase 3 studies. The company is poised to continue adding new indications to its existing medicines even as it develops new drugs, beefing up its lineup and continuing to grow its revenue and earnings. Investors should especially keep an eye on Regeneron's COVID-19 efforts, which could turn into a major opportunity for the company. Even if not, though, the biotech looks to be in a strong position to continue beating the market in the long run.

Regeneron is trading at 20 times future earnings, which is a bit high. However, the company seems a bit cheaper when taking into account its expected earnings growth; the biotech's price-to-earnings growth ratio is an attractive 0.5. Considering all these factors, Regeneron looks like a strong biotech stock to buy right now.