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Vertex Pharmaceuticals Incorporated (VRTX - Free Report) reported adjusted earnings of $4.38 per share for the third quarter of 2024, surpassing the Zacks Consensus Estimate of $4.13. In the year-ago quarter, the company had recorded adjusted earnings of $4.08 per share. Earnings grew year over year owing to increased product revenues.
The company reported total revenues of $2.77 billion for the third quarter, comprising cystic fibrosis (CF) product revenues. The figure beat the Zacks Consensus Estimate of $2.67 billion. Total revenues rose 12% year over year, primarily driven by higher sales of Trikafta/Kaftrio (marketed as Kaftrio in Europe).
Stay up-to-date with all quarterly releases:See Zacks Earnings Calendar.
More on VRTX's Q3 Earnings
The company currently markets four CF products — Trikafta/Kaftrio, Symdeko (marketed as Symkevi in Europe), Orkambi and Kalydeco.
CF product sales rose 10% year over year in the United States to $1.71 billion, while sales outside the United States increased 14% to $1.06 billion.
Trikafta generated sales worth $2.59 billion, up 13.7% year over year. Trikafta sales beat the Zacks Consensus Estimate and our model estimate of $2.48 billion and $2.45 billion, respectively.
Trikafta sales were driven by strong demand in both the United States and outside the U.S. market. In the outside U.S. market, growth was driven by continued uptake from the Kaftrio launches in children aged two to five years.
Sales from other CF products declined 10.6% year over year to $186.9 million. Sales of these drugs were hurt by patients switching to Trikafta.
Shares of Vertex have rallied 16.2% so far this year against the industry’s decline of 4%.
Image Source: Zacks Investment Research
While CF remains the main area of focus, Vertex has seen rapid success in its non-CF pipeline candidates’ development in the past year. Vertex and partner CRISPR Therapeutics’ (CRSP - Free Report) one-shot gene therapy Casgevy was approved for two blood disorders, sickle cell disease and transfusion-dependent beta-thalassemia, in multiple regions in late 2023/early 2024. Casgevy’s approval has diversified its commercial opportunity.
VRTX’s product revenues in the quarter included $2 million from Casgevy sales as the first patient was treated with the medicine. On the earnings call, the company mentioned that Casgevy has seen a strong launch so far.
Vertex leads the global development and commercialization of Casgevy under the terms of the 2021 agreement with support from CRISPR Therapeutics.
On the conference call, Vertex said that it now has more than 45 activated authorized treatment centers or ATCs in all regions where the therapy is approved, up from 35 at the end of the second quarter. Multiple patients have initiated cell collection.
VRTX's Cost Discussion
Adjusted research and development (R&D) expenses were up 5.2% year over year to $764 million due to higher investment in various ongoing clinical studies. Adjusted selling, general and administrative (SG&A) expenses increased 39.1% to $300.1 million in the reported quarter due to expenses for the commercial launch of Casgevy and pre-launch activities for suzetrigine.
During the reported quarter, Vertex recorded acquired in-process research and development (AIPR&D) costs of $15 million compared with $52 million reported in the year-ago quarter.
Adjusted operating income was $1.31 billion in the quarter, reflecting an increase of almost 12% year over year.
2024 Guidance
Vertex raised its total product sales guidance from a range of $10.65-$10.85 billion to $10.80-$10.90 billion for 2024. The revenue range indicates growth of 10% at the midpoint owing to the expected growth in CF. The revenue guidance also includes sales from Casgevy in approved indications and geographies.
Combined adjusted R&D and SG&A expenses for 2024 are expected in the band of $4.2 billion to $4.3 billion. Adjusted AIPR&D charges are expected to be approximately $4.6 billion for 2024, including Alpine acquisition costs recorded in the second quarter of 2024. The guidance for the adjusted R&D and SG&A expenses as well as adjusted AIPR&D charges remain unchanged from the previous expectation.
VRTX's Pipeline Update
Vertex has additional near-term launches planned. These include suzetrigine (VX-548) for acute pain and vanzacaftor triple for CF.
The FDA accepted Vertex’s new drug application (NDA), seeking approval for suzetrigine in moderate-to-severe acute pain in July 2024. The regulatory body has granted a priority review to the NDA, with a decision expected on Jan. 30, 2025.
Vertex has initiated a pivotal phase III program of suzetrigine in diabetic peripheral neuropathy, a form of peripheral neuropathic pain caused by damage to nerves. The company has also completed a phase II study on suzetrigine in patients with painful lumbosacral radiculopathy, another form of peripheral neuropathic pain. Data from this study is expected by 2024-end.
Per VRTX, suzetrigine has the potential to transform the treatment paradigm of pain, both acute and neuropathic. Pain is an area with limited treatment options, mostly highly addictive opioid-based medications.
Vertex’s NDA seeking approval for vanza triple, a next-in-class triple combination regimen for treating people with CF aged six years and older, is under review with the FDA. It has granted priority review to this NDA, with a decision expected on Jan. 2, 2025. Vertex’s regulatory application for vanza triple is also under review in the EU and some other countries.
Vanza triple is a combination of vanzacaftor, a CFTR potentiator, deutivacaftor, a CFTR corrector and tezacaftor. This new once-a-day oral combination medicine has the potential for enhanced patient benefit than Trikafta. It has the potential to become a new standard-of-care treatment in CF. It can potentially treat CF patients who have discontinued Trikafta or other Vertex CF medicines. It can also improve dosing (once daily) and lower the royalty burden.
Vertex has a rapidly advancing mid- to late-stage pipeline in other disease areas like APOL1-mediated kidney diseases, alpha-1 antitrypsin deficiency and cell therapy for type I diabetes.
During the quarter, Vertex initiated a phase II study with an oral formulation of next-gen Nav1.8 inhibitor, VX-993, for the treatment of moderate-to-severe acute pain following bunionectomy surgery. The candidate is also in phase I development for the IV formulation.
An oral formulation of VX-993 is also being investigated in a phase II study for treating diabetic peripheral neuropathy.
The acquisition of Alpine in May 2024 added povetacicept to Vertex’s pipeline. Povetacicept is designed to target two proteins, namely BAFF and APRIL, which are jointly responsible for the cause of multiple serious autoimmune diseases.
During the quarter, Vertex initiated the phase III RAINIER study on povetacicept for the treatment of IgA nephropathy. Povetacicept is also being evaluated in two phase II basket studies, one in renal diseases and a second in B cell mediated diseases.
Vertex Pharmaceuticals Incorporated Price, Consensus and EPS Surprise
In the past 60 days, estimates for Atea Pharmaceuticals’ 2024 loss per share have narrowed from $2.55 to $2.22. Loss per share estimates for 2025 have narrowed from $2.58 to $1.80 during the same time. Year to date, shares of AVIR have increased 9.8%.
AVIR’s earnings beat estimates in two of the trailing four quarters while missing on the remaining two occasions, the average surprise being 5.23%.
In the past 60 days, estimates for Amicus’ 2024 earnings per share have moved up from 21 cents to 22 cents. Earnings per share estimates for 2025 have improved from 50 cents to 53 cents during the same time. Year to date, shares of FOLD have declined 20.2%.
FOLD’s earnings beat estimates in three of the trailing four quarters while missing on the remaining occasion, the average surprise being 23.96%.
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VRTX Q3 Earnings & Sales Trump Estimates, '24 Sales View Raised
Vertex Pharmaceuticals Incorporated (VRTX - Free Report) reported adjusted earnings of $4.38 per share for the third quarter of 2024, surpassing the Zacks Consensus Estimate of $4.13. In the year-ago quarter, the company had recorded adjusted earnings of $4.08 per share. Earnings grew year over year owing to increased product revenues.
The company reported total revenues of $2.77 billion for the third quarter, comprising cystic fibrosis (CF) product revenues. The figure beat the Zacks Consensus Estimate of $2.67 billion. Total revenues rose 12% year over year, primarily driven by higher sales of Trikafta/Kaftrio (marketed as Kaftrio in Europe).
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
More on VRTX's Q3 Earnings
The company currently markets four CF products — Trikafta/Kaftrio, Symdeko (marketed as Symkevi in Europe), Orkambi and Kalydeco.
CF product sales rose 10% year over year in the United States to $1.71 billion, while sales outside the United States increased 14% to $1.06 billion.
Trikafta generated sales worth $2.59 billion, up 13.7% year over year. Trikafta sales beat the Zacks Consensus Estimate and our model estimate of $2.48 billion and $2.45 billion, respectively.
Trikafta sales were driven by strong demand in both the United States and outside the U.S. market. In the outside U.S. market, growth was driven by continued uptake from the Kaftrio launches in children aged two to five years.
Sales from other CF products declined 10.6% year over year to $186.9 million. Sales of these drugs were hurt by patients switching to Trikafta.
Shares of Vertex have rallied 16.2% so far this year against the industry’s decline of 4%.
Image Source: Zacks Investment Research
While CF remains the main area of focus, Vertex has seen rapid success in its non-CF pipeline candidates’ development in the past year. Vertex and partner CRISPR Therapeutics’ (CRSP - Free Report) one-shot gene therapy Casgevy was approved for two blood disorders, sickle cell disease and transfusion-dependent beta-thalassemia, in multiple regions in late 2023/early 2024. Casgevy’s approval has diversified its commercial opportunity.
VRTX’s product revenues in the quarter included $2 million from Casgevy sales as the first patient was treated with the medicine. On the earnings call, the company mentioned that Casgevy has seen a strong launch so far.
Vertex leads the global development and commercialization of Casgevy under the terms of the 2021 agreement with support from CRISPR Therapeutics.
On the conference call, Vertex said that it now has more than 45 activated authorized treatment centers or ATCs in all regions where the therapy is approved, up from 35 at the end of the second quarter. Multiple patients have initiated cell collection.
VRTX's Cost Discussion
Adjusted research and development (R&D) expenses were up 5.2% year over year to $764 million due to higher investment in various ongoing clinical studies. Adjusted selling, general and administrative (SG&A) expenses increased 39.1% to $300.1 million in the reported quarter due to expenses for the commercial launch of Casgevy and pre-launch activities for suzetrigine.
During the reported quarter, Vertex recorded acquired in-process research and development (AIPR&D) costs of $15 million compared with $52 million reported in the year-ago quarter.
Adjusted operating income was $1.31 billion in the quarter, reflecting an increase of almost 12% year over year.
2024 Guidance
Vertex raised its total product sales guidance from a range of $10.65-$10.85 billion to $10.80-$10.90 billion for 2024. The revenue range indicates growth of 10% at the midpoint owing to the expected growth in CF. The revenue guidance also includes sales from Casgevy in approved indications and geographies.
Combined adjusted R&D and SG&A expenses for 2024 are expected in the band of $4.2 billion to $4.3 billion. Adjusted AIPR&D charges are expected to be approximately $4.6 billion for 2024, including Alpine acquisition costs recorded in the second quarter of 2024. The guidance for the adjusted R&D and SG&A expenses as well as adjusted AIPR&D charges remain unchanged from the previous expectation.
VRTX's Pipeline Update
Vertex has additional near-term launches planned. These include suzetrigine (VX-548) for acute pain and vanzacaftor triple for CF.
The FDA accepted Vertex’s new drug application (NDA), seeking approval for suzetrigine in moderate-to-severe acute pain in July 2024. The regulatory body has granted a priority review to the NDA, with a decision expected on Jan. 30, 2025.
Vertex has initiated a pivotal phase III program of suzetrigine in diabetic peripheral neuropathy, a form of peripheral neuropathic pain caused by damage to nerves. The company has also completed a phase II study on suzetrigine in patients with painful lumbosacral radiculopathy, another form of peripheral neuropathic pain. Data from this study is expected by 2024-end.
Per VRTX, suzetrigine has the potential to transform the treatment paradigm of pain, both acute and neuropathic. Pain is an area with limited treatment options, mostly highly addictive opioid-based medications.
Vertex’s NDA seeking approval for vanza triple, a next-in-class triple combination regimen for treating people with CF aged six years and older, is under review with the FDA. It has granted priority review to this NDA, with a decision expected on Jan. 2, 2025. Vertex’s regulatory application for vanza triple is also under review in the EU and some other countries.
Vanza triple is a combination of vanzacaftor, a CFTR potentiator, deutivacaftor, a CFTR corrector and tezacaftor. This new once-a-day oral combination medicine has the potential for enhanced patient benefit than Trikafta. It has the potential to become a new standard-of-care treatment in CF. It can potentially treat CF patients who have discontinued Trikafta or other Vertex CF medicines. It can also improve dosing (once daily) and lower the royalty burden.
Vertex has a rapidly advancing mid- to late-stage pipeline in other disease areas like APOL1-mediated kidney diseases, alpha-1 antitrypsin deficiency and cell therapy for type I diabetes.
During the quarter, Vertex initiated a phase II study with an oral formulation of next-gen Nav1.8 inhibitor, VX-993, for the treatment of moderate-to-severe acute pain following bunionectomy surgery. The candidate is also in phase I development for the IV formulation.
An oral formulation of VX-993 is also being investigated in a phase II study for treating diabetic peripheral neuropathy.
The acquisition of Alpine in May 2024 added povetacicept to Vertex’s pipeline. Povetacicept is designed to target two proteins, namely BAFF and APRIL, which are jointly responsible for the cause of multiple serious autoimmune diseases.
During the quarter, Vertex initiated the phase III RAINIER study on povetacicept for the treatment of IgA nephropathy. Povetacicept is also being evaluated in two phase II basket studies, one in renal diseases and a second in B cell mediated diseases.
Vertex Pharmaceuticals Incorporated Price, Consensus and EPS Surprise
Vertex Pharmaceuticals Incorporated price-consensus-eps-surprise-chart | Vertex Pharmaceuticals Incorporated Quote
VRTX's Zacks Rank
Vertex currently carries a Zacks Rank #3 (Hold).
Key Picks Among Biotech Stocks
Some better-ranked stocks from this space are Atea Pharmaceuticals, Inc. (AVIR - Free Report) and Amicus Therapeutics, Inc. (FOLD - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, estimates for Atea Pharmaceuticals’ 2024 loss per share have narrowed from $2.55 to $2.22. Loss per share estimates for 2025 have narrowed from $2.58 to $1.80 during the same time. Year to date, shares of AVIR have increased 9.8%.
AVIR’s earnings beat estimates in two of the trailing four quarters while missing on the remaining two occasions, the average surprise being 5.23%.
In the past 60 days, estimates for Amicus’ 2024 earnings per share have moved up from 21 cents to 22 cents. Earnings per share estimates for 2025 have improved from 50 cents to 53 cents during the same time. Year to date, shares of FOLD have declined 20.2%.
FOLD’s earnings beat estimates in three of the trailing four quarters while missing on the remaining occasion, the average surprise being 23.96%.