Regeneron hits the gas on R&D, pouring cash into a blockbuster pipeline

Regeneron Chief Scientific Officer George Yancopoulos

Regeneron ($REGN) has again dialed up its R&D budget, spending more and more on a slew of late-stage assets that promise to line its pockets and an emerging crop of early drugs the Big Biotech believes can beat a path to blockbuster status.

The Tarrytown, NY, company laid out $295 million for R&D in the second quarter, a roughly 58% jump over the same period last year to account for more and bigger studies on a cadre of near-market candidates. And Regeneron plans to keep up the accelerated pace, projecting its 2014 solo R&D spend--the work not reimbursed by partners like Sanofi ($SNY)--to come in at up to $510 million, a nearly 8% hike over its early-year guidance.

That ever-escalating research budget has Regeneron sitting on a trio of late-stage assets, poised to pay big if all goes according to plan.

Leading the way is alirocumab, a Sanofi-partnered cardio treatment gearing up to contend with offerings from Amgen ($AMGN) and Pfizer ($PFE) in the soon-to-be market for drugs that slash bad cholesterol by blocking a gene called PCSK9. The injectable antibody was widely considered second in line behind Amgen until Regeneron and its French compatriot took advantage of a regulatory wrinkle that will speed up the drug's FDA review, setting up alirocumab for marquee billing and an estimated sales peak north of $1 billion.

Behind that is sarilumab, a Sanofi-shared rheumatoid arthritis treatment that works by halting the IL-6 receptor to tamp down inflammation. The partners disclosed some strong Phase III results earlier this summer and expect to report results from their 6-study late-stage program next year, targeting regulatory applications after that.

And then there's dupilumab, an IL-4 and IL-13 antibody that beat back eczema in a Phase IIb study disclosed last month, leading Regeneron to draw up plans for a Phase III effort later this year. The drug, also licensed to Sanofi, has already come through in a mid-stage study in asthma, and Regeneron is studying its potential to treat nasal polyps.

But the company's most promising assets may lay in its early-stage pipeline. As Chief Scientific Officer George Yancopoulos told investors on an earnings call, Regeneron is shouldering its way into the immuno-oncology space, planning to hit the clinic this year with a CD20-CD3 bispecific antibody and a treatment targeting the en-vogue PD-1 pathway. And the company's discovery engine is humming, too, Yancopoulos said, pointing to the Regeneron Genetics Center, a recently launched initiative that brings in academic partners to advance personalized medicine.

- read the results (PDF)
- listen to the earnings call

Special Report: The top 15 late-stage blockbusters in the pipeline - Alirocumab

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