US Biotechs to Benefit from Prices and Demand

(DOW JONES NEWSWIRES) The large biotech drug makers will begin reporting first-quarter results next week and should face easier year-over-year comparisons from last year's tough period. Demand is expected to be stronger, and many companies are expected to continue benefiting from price increases on
key products.

Aside from the numbers, a key area of discussion will be the effect of health-care legislation on the industry. The law is largely seen as helping companies by providing coverage to more patients and giving long exclusivity to lucrative biologic drugs.

Aside from the removal of that overhang, analysts warn that the dollar's strength may make overseas revenue growth lower than expected, something that could continue in subsequent quarters.

"We don't anticipate any major beats vs consensus, and on this basis we would not anticipate any of the companies making major revisions to their 2010 guidance this quarter," writes Sanford Bernstein analyst Geoffrey Porges.

COMPANIES TO WATCH:


Biogen Idec Inc. (BIIB) - reports April 20 (AM)

Wall Street Expectations: Analysts expect earnings of $1.13 a share on revenue of $1.12 billion, according to Thomson Reuters. A year ago, earnings were 84 cents a share, or $1.05 a share excluding items, on revenue of $1.04 billion.

Key Issues: Biogen recently cut a deal with activist shareholder Carl Icahn to give him more board representation, but the possibility of restructuring and other changes remains. Current Chief Executive Jim Mullen is retiring this summer, and the company is continues its replacement search. Aside from product sales, Wall Street will be looking at patient numbers for multiple sclerosis drug Tysabri, which Biogen sells with Elan Corp. (ELN) and is key to the growth of both companies. Any additional updates or related news on cases of a rare
brain infection, known as PML, among users of the drug will be notable.

Genzyme Corp. (GENZ) - reports April 21 (AM)
Wall Street Expectations: Analysts predict Genzyme will report earnings of 33 cents on revenue of $1.14 billion. A year ago, the company reported earnings of 70 cents a share, or $1.04 excluding items, on revenue of $1.15 billion.

Key Issues: Few people will focus on Genzyme's quarterly financial performance, as operational issues dominate investor concerns. Meanwhile, Icahn is trying to put himself and three others on the company's board. Genzyme has had manufacturing and regulatory problems stretching back to 2008 at its main production facility, the sole source of its two top-selling drugs. The company
expects a consent decree from the Food and Drug Administration, which probably will add years of third-party oversight to the Allston, Mass., facility. Lumizyme, a long-delayed version of Pompe disease treatment Myozyme produced at a larger scale, should get an FDA decision by June 17, and related comments also could be important.

Amgen Inc. (AMGN) - reports April 21 (PM)

Wall Street Expectations: Analysts predict earnings of $1.24 a share on revenue of $3.65 billion. A year ago, profit was 98 cents a share, or $1.08 excluding items, on revenue of $3.3 billion.

Key Issues: Investors will watch the sales strength of core products, anemia drugs Epogen and Aranesp and anti-inflammatory Enbrel. Amgen sells Enbrel with Pfizer Inc. (PFE) and has given it an increased sales push in recent months.
Investors will focus on the ongoing FDA review of experimental bone drug denosumab after its initial attempt was rejected in October. A decision on the resubmission is expected by July 25. The company plans to file for approval in a second use in cancer patients later this year.

Celgene Corp. (CELG) - reporting April 29 (AM)

Wall Street Expectations - Analysts are expecting earnings of 60 cents a share on revenue of $757 million. A year ago, Celgene reported earnings of 35 cents a share, or earnings of 44 cents a share excluding items, on revenue of $605.1 million.

Key Issues: Celgene's investors will watch for sales updates on flagship drug Revlimid, along with associated insights about market share and duration of usage among patients. Celgene recently held a pipeline review but may provide more insight into plans for expanding Revlimid's approval as an initial treatment and maintenance option for multiple myeloma patients.