Yesterday, biopharma giant Genzyme (NASDAQ:GENZ) announced unexpectedly strong first-quarter financial results on the back of higher sales of recently launched compounds.

With the higher sales ramp-up of its newly marketed drug Myozyme, which treats a neuromuscular disorder, Genzyme is continuing to grow sales at a high rate (see the chart below). The biopharma also upped earnings guidance due to the strong sales trends in the first quarter. For the full year non-GAAP earnings per share are now expected to be in the range of $3.20 to $3.25 per share.


Y-O-Y Growth

Q1 2007



Q4 2006



Q3 2006



Q2 2006



Q1 2006



*in millions

Genzyme is also doing a good job of controlling costs, which only increased 13% despite the addition of new clinical stage programs with its acquisition of AnorMED. Not all of the larger biotechs have proven to be good at controlling expenditures; Genzyme deserves kudos for its success.

So what's not to like about shares of Genzyme? For one, it is not particularly cheap in my view, trading at a 20 times its 2007 earnings guidance. With the uncertainties inherent in the drug development and marketing processes, I'd generally like to have more of a discount before owning shares. Then again, Genzyme has a solid drug pipeline and no major near-term competitive threats for its top products. Less risk-averse investors could do worse than owning shares of this best-in-class biotech, especially if clinical stage programs like the recently acquired Mozobil pan out.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool has a disclosure policy.