Is Biogen Stock a Buy Now That Guidance Has Been Raised?

October 26, 2022 at 14:53 PM EDT

Biogen stock (NASDAQ:BIIB) continues to get excellent news. On Tuesday, the pharmaceutical company released its third-quarter results, and for the first time in a long time, investors found something to rejoice about in one of its financial reports.

Biogen stock (NASDAQ:BIIB) outperformed Wall Street on both the top and bottom lines. The business has raised its sales and profit projections for 2022. So, is Biogen stock (NASDAQ:BIIB) a good investment right now?

What is most important to Biogen Stock?

The most significant topic discussed in the recent biotech update was lecanemab. On September 27, Biogen and its partner, Japanese pharmaceutical company Eisai (ESALY 3.65%), reported the findings of late-stage clinical research testing the medicine as a therapy for Alzheimer’s disease. You simply have to look at the massive jump in Biogen stock that week to see how great those data were.

The initial remarks made by Biogen CEO Michel Vounatsos during the Q3 results call centered on lecanemab. That is not that unexpected. The Alzheimer’s disease treatment has the capacity to affect the game for the corporation.

You may even argue that lecanemab could save Biogen’s life. Overall sales for the company’s presently authorized medications continue to drop, according to Q3 statistics. The Alzheimer’s disease medicine Aduhelm was a flop since the Centers for Medicare and Medicaid Services announced that the treatment would not be covered by Medicare unless used in authorized clinical trials. Biogen and Eisai, on the other hand, are bringing lecanemab to the table, a medicine that seems to delay the course of Alzheimer’s disease.

The two businesses will It won’t take long to find out. if they will be permitted to offer lecanemab in the United States. Food and Drug Administration has established a PDUFA date of January 6 for its decision on lecanemab’s fast approval. Eisai also intends to apply for licenses in Japan and Europe and complete “conventional” permission in when the United States by the first quarter of 2023.

Should you buy Biogen stock?

Returning to the original issue, is Biogen stock (NASDAQ:BIIB) a good investment right now? It’s evident that the company’s better prognosis for 2022 doesn’t mean anything. However, lecanemab can alter the game for Biogen.

According to analysts, the Alzheimer’s disease treatment might yield peak annual sales of $6 billion to $10 billion. Biogen stands to collect 50% of all lecanemab revenues worldwide.

Several intriguing treatments are also in the company’s pipeline, awaiting approval or late-stage testing. Zuranolone, an investigational medication being researched for depression by Biogen and Sage Therapeutics, stands up as a particularly notable contender.

In my opinion, Biogen’s present market worth of roughly $40 billion undervalues the potential of lecanemab and other drugs in its portfolio and pipeline. So, although I believe biogen stock (NASDAQ:BIIB) is now a buy, it has nothing to do with its raised full-year outlook.

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