Neurocrine Biosciences (NBIX 0.29%), a biopharmaceutical company focused on innovative therapies for neurological disorders, released its third-quarter earnings on Oct. 30. The company's results exceeded analysts' expectations with total revenue reaching $622.1 million -- well above the estimated $600.64 million -- largely driven by a significant expansion in sales of its flagship product, Ingrezza.
Neurocrine also reported non-GAAP earnings per share (EPS) of $1.81, markedly higher than the consensus estimate of $1.52. The quarter reflected a constructive narrative as Ingrezza, alongside bolstered research and development strategies, positioned the company for sustained growth.
| Metric | Q3 2024 | Q3 2024 Analyst Estimate | Q3 2023 | % Change (YOY) |
|---|---|---|---|---|
| Revenues | $622.1 million | $600.64 million | $498.8 million | 24.7% |
| Non-GAAP EPS | $1.81 | $1.52 | $1.54 | 17.5% |
| Ingrezza net product sales | $613 million | - | $485.7 million | 26.2% |
| GAAP net income | $129.8 million | - | $83.1 million | 56.2% |
Source: Analyst estimates for the quarter provided by FactSet.
Understanding Neurocrine Biosciences
Neurocrine Biosciences specializes in developing therapies that address unmet medical needs for neurological and endocrine-related conditions. Ingrezza, a treatment for tardive dyskinesia and Huntington’s disease chorea, is the company's principal product. Launched in 2017, it accounted for 99% of Neurocrine's net product sales in 2023.
The company's strategic priorities include bolstering sales of Ingrezza and expanding its portfolio via substantial investment in its pipeline programs. Noteworthy projects include valbenazine for neurological disorders and crinecerfont for congenital adrenal hyperplasia. Each offers a promising avenue to diversify the company's revenue stream and lessen its dependence on Ingrezza.
Quarterly Highlights
In the third quarter, Ingrezza sales increased 26% to $613 million. This uptick stemmed from strong patient demand and beneficial gross-to-net dynamics. Correspondingly, management boosted its revenue guidance for 2024 to a range of $2.30 billion to $2.32 billion.
The company also authorized a $300 million share repurchase plan — a testament to the company's robust cash position, which stood at $1.9 billion as of the quarter’s end.
The quarter also witnessed notable advances within the R&D spectrum. Neurocrine increased its R&D expenses to $195 million, a reflection of proactive investments in drug pipelines and project milestones. Key developments included the FDA’s agreement to give priority review to Crinecerfont and a positive data release from a phase 2 study of NBI-1117568, which is being tested as a potential treatment for schizophrenia. However, another candidate hit a snag in clinical testing: In a phase 2 study of Luvadaxistat as a treatment for cognitive impairment associated with schizophrenia, the drug didn't meet its primary endpoint.
While operational efficiency remained a highlight, with non-GAAP EPS surpassing projections, the company also recorded increased SG&A expenses driven by sales force expansions. SG&A costs reached $234.3 million for Q3 2024.
Looking Ahead
Neurocrine is poised to maintain its growth trajectory. Sales of Ingrezza are expected to increase, and there is reason to anticipate an FDA approval for crinecerfont. R&D investments will remain a central theme as it attempts to bolster its position in the neurological drug market.
