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Regeneron Pharmaceuticals is making less money, but the company has a plan to fix this

The revenue of Regeneron Pharmaceuticals Inc. (REGN) dropped sharply in the last quarter, both compared to the same quarter last year and to the quarter before that. The drop in sales of the drug used to treat COVID-19 was the main reason for the drop in income. Regeneron Pharmaceuticals is already working to bring in money again, though. Smaller developers are likely to be the ones that will be bought first. Regeneron Pharmaceuticals’ sales dropped by 40% in the first quarter of 2022 when compared to the fourth quarter of 2021.

The drug REGEN—COV, which is used to treat COVID-19, is to blame for the sharp drop in sales. Due to the fact that it doesn’t work against the omicron variant, the FDA recently put limits on how this drug can be used. This means that sales of REGEN-COV are not likely to improve soon. At the same time, Regeneron Pharmaceuticals is making a lot of investments in joint projects. This type of activity increased revenue by 63 percent in the first quarter of 2022 compared to the same period last year.Most of the money comes from agreements to share in the profits. In the near future, Regeneron Pharmaceuticals may make more money by making deals that are good for both sides.

This month, the company announced that it had bought all the rights to Libtayo, a drug for cancer that it had made with Sanofi. The deal is set to close in the third quarter of this year. After that, Regeneron Pharmaceuticals will record all sales and income from the product. Last year, Libtayo made $458.2 million all over the world. Also, Regeneron Pharmaceuticals just bought Checkmate Pharmaceuticals for $250 million, which should make its portfolio of drugs for treating cancer stronger. Regeneron Pharmaceuticals has a lot of hopes for the candidate drug vidutolimod, which is being tested for head and neck cancer and other types of cancer in phase II studies.

Regeneron Pharmaceuticals has about $14 billion in cash on hand, which it can use to make deals. The company plans to diversify its portfolio and make up for the drop in sales caused by its COVID-19 drugs by making transactions. Will this plan work? Only time will tell. But the company is in a transitional phase right now, so it’s risky to put money into it.

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