2020 is looking like a year to forget for BioMarin Pharmaceutical (BMRN -0.28%). The decision by the Food and Drug Administration (FDA) to not approve Roctavian (valoctocogene roxaparvovec) in treating severe hemophilia A rocked the company and its share price.
BioMarin had an opportunity to give investors some good news when the company announced its third-quarter results after the market closed on Thursday. Here are the highlights from BioMarin's Q3 update.
By the numbers
BioMarin reported revenue of $476.8 million in the third quarter, a 3% increase from the $461.1 million reported in the prior-year period. This result topped the average analyst's revenue estimate of $454.64 million.
The biotech announced net income in the third quarter of $784.8 million, or $4.01 per share, based on generally accepted accounting principles (GAAP). This was a huge improvement over the GAAP earnings of $55 million, or $0.30 per share, posted in the same quarter of 2019. It also blew away the consensus Wall Street earnings estimate of $1.29 per share.
On a non-GAAP adjusted basis, BioMarin recorded earnings of $98.7 million. This result reflected a big jump from the company's adjusted earnings of $78.1 million in the prior-year period.
Behind the numbers
BioMarin's best news in Q3 came from its phenylketonuria (PKU) franchise. In particular, net product sales for Palynziq increased by $22 million year over year. In total, the company's PKU franchise revenue jumped 18% higher year over year to $170.2 million. In addition, net product revenue for MPS I drug Aldurazyme, which is marketed by Genzyme, soared 79% to $40.9 million.
The bad news, however, was that net product revenue for Naglazyme, which treats rare disease mucopolysaccharidosis VI (MPS VI), dropped 19% year over year to $76.3 million. Net product revenue for Vimizim, which treats a related rare disease MPS IVA, fell 10% to $147.9 million. BioMarin attributed these declines to the timing of Latin American orders and the impact of the COVID-19 pandemic.
BioMarin's GAAP bottom line received a boost from an $800.8 million income tax benefit related to the completion of the transfer of intellectual property rights to its Irish subsidiary. The company also had lower research-and-development costs resulting from a reduction in clinical manufacturing costs for PKU drug BMN 307 and decreased spending for clinical testing for Roctavian.
BioMarin now anticipates full-year 2020 revenue of between $1.81 billion and $1.87 billion. This is lower than the company's previous guidance range of revenue between $1.85 billion and $1.95 billion. The company expects GAAP net income will be between $760 million and $820 million, down from its previous outlook for GAAP earnings between $720 million and $980 million.
However, BioMarin looks for higher non-GAAP earnings of between $280 million and $330 million. It previously projected non-GAAP earnings in the range of $260 million to $310 million.
The near-term fortunes for the biotech stock will depend largely on how the COVID-19 pandemic continues to impact the sales of its products. BioMarin also has several key milestones on the way, notably including potential U.S. and European regulatory approvals for vosoritide in treating achondroplasia, the most common form of dwarfism.