Regeneron Pharmaceuticals Inc. (NASDAQ: REGN) has outpaced its peers in the medical space in what is turning out to be a break out year for the biopharmaceutical giant. The stock is up by more than 50% for the year, with more room to run on the upside, after consolidating in the recent past.
Regeneron Pharmaceutical Outlook
The strong performance stems from a perfect business opportunity triggered by the COVID-19 pandemic. Reports that the company’s COVID-19 trial drug was given to President Donald Trump while hospitalized at Walter Reed is one of the developments that strengthen the stock's sentiments in the market.
While the pharmaceutical stock is up by more than 50% for the year, it looks set to continue powering higher as underlying fundamentals continue to support further upside action. The rally could as well be fuelled by reports that the company’s experimental drug REGN-COV2 could play a pivotal role in combating the havoc causing virus.
Shares of the company surged by more than 7% as it became clear that the Pharma drug could help relieve the coronavirus's effects. A rally back to 52-week highs of $664 looks likely amid renewed investor interest in the stock.
Immediate support on any downside action is seen at the $557 level, whereby Regeneron Pharmaceuticals remains well supported for further upside action.
REGN-COV2 Emergency Regulatory Approval
Reports that REGN-COV2 could get an emergency regulatory authorization in a matter of days after President Trump's validation should continue to strengthen Regeneron Pharmaceuticals sentiments in the market.
Emergency Use Authorization would be a major milestone for Regeneron Pharmaceuticals, given the number of people struggling with the disease worldwide. Likewise, it could allow the company to generate significant revenues as the U.S continues to tackle the second wave of infection that has already taken a toll on economic activity.
If Approved, REGN-COV2 would provide a new and reliable stream of revenue for the Regeneron Pharmaceutical gave millions of people battling the virus around the world. The biopharmaceutical company has already inked a supply agreement with the U.S government to supply the experimental drug worth $450 million.
Regeneron Pharmaceuticals has already inked a strategic partnership with Swiss Pharma giant Roche RHHBY for the development, manufacture, and distribution of REGN-COV2 in the United States.
Roche RHHBY would be tasked with distributing the experimental drug outside the country once it gains all the necessary regulatory approval. The ultimate goal is to increase the geographical reach and generate as much revenues as possible before the market gets flooded with drugs from other companies, also under development.
Apart from the COVID-19 treatment, Regeneron Pharmaceuticals has continued to race higher on investors taking note of the company’s efforts to expand its label of approved drugs and develop a new pipeline as well.
Dupixent is the Regeneron Pharmaceutical's lead drug approved for the treatment of moderate to severe atopic dermatitis. The drug maintains momentum for the pharmaceutical drug giant, helping offset a slowdown in sales on lead drug Eylea's.
Regeneron Robust Pipeline
Likewise, Regeneron Pharmaceuticals boasts of a diverse portfolio of drugs that continue to reap returns. The drugs are also expected to offset any losses that the company might incur on REGN-COV2, failing to secure regulatory approval or losing steam on vaccines coming out.
Regeneron Pharmaceuticals' financials have been improving after taking a hit at the pandemic's peak in the first quarter. The biopharmaceutical company reported a 24% increase in revenues in the second quarter that came in at $1.95 billion amid significant challenges owing to the COVID-19 pandemic.