Vertex Pharmaceuticals' (VRTX) cystic fibrosis drug sales popped 22% in the first quarter, helping drive a $200 million-plus sales beat and profit that topped Wall Street's expectations by a penny.
In after-hours trading, Vertex stock lifted 1.7%, near 119.40, after closing up less than 1%, at 117.23. Shares are up 59% for the year, outperforming IBD's 425-company Medical-Biomed/Biotech industry group, which is up just 12.3% since January.
For the first quarter ended March 31, Vertex reported $714.7 million in sales, up 80% vs. the year-earlier period. That was helped by a $230 million collaborative payment from Merck KGaA in the quarter. Of that, $36.4 million was paid in taxes to German authorities, but Vertex filed for, and expects, a refund.
Sales easily beat analysts' expectations for $510.55 million, but without the $230 million in collaborative payments from Merck KGaA they would have lagged the model by about $26 million. Adjusted earnings of 41 cents per share grew 356% and beat by a penny.
Vertex's bread-and-butter segment, cystic fibrosis, saw sales grow 22% to $480.6 million in the first quarter. Orkambi and Kalydeco, CF drugs, brought in $294.9 million and $185.7 million in sales, respectively, growing 32.2% and 8.9%.
IBD'S TAKE: Vertex has an IBD Composite Rating of 98 out of a best-possible 99, meaning it outperforms all but 2% of stocks in terms of key growth metrics. Head to IBD Stock Checkup for a list of the top-rated biotechs.
Vertex saw continued uptake in Orkambi among children age 6-11 in the U.S. and completed an application for the same group of patients with regulators in Europe, CEO Jeffrey Leiden said in a statement.
During the quarter, Vertex also unveiled strong data from two Phase 3 studies combining tezacaftor and ivacaftor to treat cystic fibrosis. The combination showed a statistically significant improvement in lung function for patients with the disorder.
The company is also looking at four potential drugs that could be combined with tezacaftor and ivacaftor to create a triple-pill for cystic fibrosis patients. Vertex expects three to have data in the second half of 2017 and one to have data in early 2018.
"We remain focused on advancing key CF programs, including our triple combination regimens, to support our goal of providing treatments for all people with CF," Leiden said.
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