Regeneron Earnings: Raising Our Fair Value on Near-Term Eylea Boost, Long-Term Dupixent Prospects

We’re raising our Regeneron fair value estimate to $750 from $690 following solid second-quarter performance, particularly as we think Dupixent’s long-term prospects continue to improve and Eylea sales stay steadier than we anticipated, in the face of branded competition from Roche’s Vabysmo. Regeneron’s revenue grew 11% in the second quarter as continued stellar growth for immunology drug Dupixent (33%) drove collaboration revenue from partner Sanofi to grow by an even higher 39% as Dupixent’s profitability improves. This countered some weakness in ophthalmology drug Eylea due to price concessions in the face of the launch of Vabysmo. We assume that upcoming approvals for Dupixent will only add to the drug’s blockbuster sales, driving peak sales approaching $20 billion in 2029 (ahead of potential Medicare negotiation). We expect COPD approval in 2025, with potential approval of COPD antibody itepekimab in 2026 to complement Dupixent. Overall, we think Regeneron’s core antibody Dupixent as well as a growing oncology pipeline support a narrow moat, regardless of whether Eylea can continue to grow as the high-dose version launches later this year.