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Biogen Inc BIIB

Morningstar Rating
$230.06 −6.74 (2.85%)
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Company Report

Biogen: Lowering Our Moat Rating to Narrow Based on MS Sales Pressure and Leqembi Uncertainty

We're lowering Biogen's moat rating to narrow from wide after reassessing the firm's competitive advantages. As the firm faces steady pressure on its older multiple sclerosis drugs from generic and branded competitors, we think returns on invested capital will be under pressure, particularly as Alzheimer's drug Leqembi (via a collaboration with partner Eisai) has launched more slowly than we had expected. We still think global Leqembi sales will eventually surpass $6 billion, but we see high uncertainty around this estimate and around our Biogen valuation more broadly. We assume that Biogen’s share of revenue (from partner Eisai) won’t be significant until 2025 as Biogen and Eisai are in the process of boosting their marketing efforts and expanding approval to include maintenance and subcutaneous dosing.

Price vs Fair Value

BIIB is trading at a 543% premium.
Price
$230.06
Fair Value
$151.00
Uncertainty
High
1-Star Price
$835.16
5-Star Price
$635.70
Economic Moat
Bmybmfd
Capital Allocation
Scyfqvtk

Bulls Say, Bears Say

Bulls

Biogen is a significant player in the $20 billion global MS market with Avonex, Plegridy, Tysabri, and Tecfidera. The launch of Vumerity partly protects Tecfidera sales from generic headwinds in the US.

Bears

Biogen's MS portfolio is under pressure from newer branded drugs as well as generic and biosimilar versions of its older therapies.

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News

Trading Information

Previous Close Price
$236.80
Day Range
$226.50238.00
52-Week Range
$189.44281.12
Bid/Ask
$230.34 / $232.76
Market Cap
$33.50 Bil
Volume/Avg
232 / 1.1 Mil

Key Statistics

Price/Earnings (Normalized)
15.34
Price/Sales
3.47
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield

Company Profile

Biogen and Idec merged in 2003, combining forces to market Biogen's multiple sclerosis drug Avonex and Idec's cancer drug Rituxan. Today, Rituxan and next-generation antibody Gazyva (oncology) and Ocrevus (multiple sclerosis) are marketed via a collaboration with Roche. Biogen markets several multiple sclerosis drugs including Plegridy, Tysabri, Tecfidera, and Vumerity. Biogen's newer products include Spinraza (SMA, with partner Ionis), Leqembi (Alzheimers, with partner Eisai), Skyclarys (Friedreich's Ataxia, Reata), Zurzuvae (postpartum depression, Sage), and Qalsody (ALS, Ionis). Biogen has several drug candidates in phase 3 trials in neurology, immunology, and rare diseases.
Sector
Healthcare
Industry
Drug Manufacturers - General
Stock Style Box
Mid Value
Total Number of Employees
7,570

Competitors

Valuation

Metric
BIIB
NVS
SNY
Price/Earnings (Normalized)
15.3416.1910.80
Price/Book Value
2.195.741.68
Price/Sales
3.474.642.54
Price/Cash Flow
14.3415.4112.56
Price/Earnings
BIIB
NVS
SNY

Financial Strength

Metric
BIIB
NVS
SNY
Quick Ratio
0.950.610.83
Current Ratio
2.100.901.27
Interest Coverage
5.3811.3211.03
Quick Ratio
BIIB
NVS
SNY

Profitability

Metric
BIIB
NVS
SNY
Return on Assets (Normalized)
8.32%13.39%8.05%
Return on Equity (Normalized)
15.02%31.09%14.38%
Return on Invested Capital (Normalized)
10.29%19.67%10.85%
Return on Assets
BIIB
NVS
SNY
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