Regeneron ($REGN), toasting the approval of its latest treatment and riding the success of its last one, is investing more and more into R&D, lining up a stable of new therapies with blockbuster ambitions.
The Tarrytown, NY, biotech spent $390 million on research last quarter, a roughly 32% increase over the same period last year. Regeneron is planning to put about $1.3 billion into R&D for all of 2015, roughly in line with its 2014 budget, but it's spending big in the short term to staff up and pay for a sizable Phase III effort.
The chief beneficiary of Regeneron's big research push is dupilumab, a late-stage antibody that targets the root cause of allergic ailments including eczema, asthma and nasal polyps. The treatment works by blocking the inflammatory proteins interleukin-4 and interleukin-13, thereby halting the immunological process behind certain allergic reactions. The injection is now in the midst of Phase III trials in eczema and asthma, and analysts say it could bring in more than $2.5 billion a year if it can succeed in both.
And Regeneron should have plenty of cash to see that through. The company's revenue hit an all-time-high $999 million last quarter thanks to continued growth of the ocular treatment Eylea, and last month's FDA approval of the new cardiovascular therapy Praluent is expected to keep the funds pouring in. Praluent, developed with longtime partner Sanofi ($SNY), will be the first among a new class of treatments called PCSK9 inhibitors to reach U.S. shelves, and market watchers expect it could top out at $3 billion a year in sales.
Alongside dupilumab, Regeneron is pushing forward with sarilumab, another Sanofi-partnered antibody that has successfully treated rheumatoid arthritis in a range of Phase III trials. The company plans to file that treatment for FDA approval by year's end. Rounding out the pipeline is the Phase III REGN2222 for respiratory syncytial virus, plus the midstage fasinumab, for osteoarthritis pain, and REGN2176-3, an Eylea add-on for age-related macular degeneration.