After Columns and Reports in The Hartford Business Journal, Connecticut Post and New Haven Register, all questioning the health and even the viability of New Haven’s flagship company Alexion Pharmaceuticals, amidst management changes and media criticism, this writer took the contrary approach.
Writing in May “I said, "On the other hand, all eighteen investment analysts that research the company, have it as a buy, expecting gains from 30% to 70%. Adding, Make some money, buy their stock, before the second quarter results come in. [ I would if I had the dough]."
The stock has continued to gain and you would be up more than 35% from our report, rising more than $37+ per share from the naysayers' low.
Why did we get it right?
We’re not content with consensus thinking backed by uninformed opinion and when it comes to a public company, we’re never going to follow the lead of self-serving short sellers or stock promoters.
Our approach, research and information, beyond just regurgitating press releases.
Our mission is not to steer you, but on the rare occasion we do, it will be backed by a foundation of vetted information, hopefully our colleagues will adopt that approach as well, when reporting on important companies in Connecticut.
If you think we’re boosters of Alexion, you can re-read our stories on the Search [Alexion] page at Conntact.com.
Alexion Shakes Off Management Change and Bad Press With Strong Financial Results
By Mitchell Young
NEW HAVEN: Alexion Pharmaceuticals, Inc. (ALXN) blew out estimates of sales and earnings for the second quarter, and new CEO Ludwig Hantson outlined some important directions on the company’s research and “pipeline” direction.
Total revenues in the quarter were $912 million, a 21% percent increase compared to the same period in 2016. Earnings were $1.56 per share, compared to $1.13 per share in the second quarter of 2016, a 38% increase.
The company’s stock price reached as high as $142 per share, after the earnings report before dropping back into the $130s, still up from a low of $96.75 in November. 2016, when the company announced an internal investigation of how it was booking certain sales, which was followed by the resignation of its CEO and CFO.
The company’s flagship product Soliris continued to move ahead generating a 16% sales increases in spite of media criticism about it marketing approach. Soliris has also been advancing for regulatory approval of other rare diseases. The company is also in clinical development of a replacement to stave off competitor drugs and generics.
The company also laid out markers for future drug development, announcing it was terminating its partnerships with three bio-techs, Moderna Therapeutics, Blueprint Medicines, both in Cambridge, MA and Arbutus Biopharma of Burnaby, Canada.
The company said it was dropping certain research approaches and sticking with its “complement franchise.” The body’s complement system is an important part of the innate immune system.
On June 13, Hantson floated the idea at the Goldman Sachs Healthcare Conference, that he was considering writing off the investment of one of the company's key drugs, Kanuma. Hantson referred to the commercial results as near the bottom on biotech launches.
Kanuma is an enzyme replacement therapy for an ultra-rare inherited metabolic disorder, it was approved by the FDA at the end of 2015.
Sales of the drug were under $26 million for the full 2016 year. Alexion paid $8.4 billion in June of 2015 for Cambridge based Synageva BioPharma Corp. [Nasdaq:GEVA].
Hantson apparently has changed his mind, as Kanuma sales did double for the quarter to $15 million and was included in the company’s presentation for an ongoing “strategic” effort, with Alexion trying to open more global markets to boost sales.
Alexion’s other acquired drug Strensiq was classified by the company as a new “growth driver,” with sales increasing 85% to $83 million for the quarter.
Hantson described the announcements saying, "Alexion delivered strong performance in the second quarter of 2017 while also executing on several initiatives to position the company for the future, including strengthening the Soliris patent portfolio, reaching a funding agreement for Strensiq in England, advancing the late-stage pipeline, enhancing compliance and culture and building a strong leadership team." He added, "Our strategy for the next phase of growth will focus on our strengths to deliver sustainable long-term performance and increased value for shareholders. We will achieve this by growing our rare disease business, leveraging our expertise in complement, pursuing disciplined business development to expand the pipeline, and taking steps to optimize our infrastructure and operating model."