IBD Stock Of The Day Neurocrine Biosciences is shrugging off broader market woes, buoyed by movement disorder drug Ingrezza and hope among NBIX stock investors for another blockbuster.
The company recently scrapped a high-profile treatment for essential tremor. Typically, a move like that would tank a biotech stock.
Instead, NBIX stock surged about 8.5%. Shares have since managed to keep those gains, even as Wall Street feels the pangs of a lower-than-expected jobs report and the continued worry of rising interest rates.
On today's stock market, Neurocrine shares climbed 1.3% to close at 104.63.
During the June quarter, Neurocrine's biggest moneymaker, Ingrezza, brought in $350 million in net sales. Ingrezza treats an involuntary movement disorder called tardive dyskinesia. Sales surged by a double-digit percentage and beat expectations.
Other Drugs Boost NBIX Stock
Neurocrine also sells a Parkinson's disease med called Ongentys and two women's health drugs with AbbVie. Those sales are smaller and have disappointed investors.
True, Neurocrine just scrapped its potential essential tremor treatment, saying the drug failed in midstage testing. But there's still plenty to like in the pipeline, analysts say.
Mizuho Securities analyst Uy Ear notes Neurocrine also is testing the same drug that failed to help essential tremor patients in patients with a form of pediatric epilepsy. He expects early test results from that effort this year. Further, Neurocrine is expected to soon ask U.S. regulators to approve Ingrezza for Huntington's disease patients with movement complications.
Neurocrine also expects to begin studies in schizophrenia and an undisclosed disease this year. The company also could have test results for depression and seizure treatments next year.
"Looking into 2023, we see more room for optimism with top-line readouts expected across multiple mid- and late-stage programs," Ear said in a report to clients. He kept his neutral rating on NBIX stock, but raised his price target to 98 from 95.
Wedbush analyst Laura Chico is watching a drug called crinecerfont. Neurocrine is testing it in patients with an inherited disorder of the adrenal glands that affects growth and development. Neurocrine is on track to release additional testing data in 2023, she said in her note to clients.
Five Years And Growing
Chico recently raised her expectations for Neurocrine revenue this year, reflecting the company's guidance boost. Now, she projects $1.405 billion in Ingrezza sales, above Neurocrine's call for $1.35 billion to $1.4 billion in sales.
"Bottom line, even after five years on the market, Ingrezza appears to hold favorable growth dynamics," she said. "The (essential tremor) miss is unfortunate, but we look ahead to further pipeline opportunities to emerge over the next 12-18 months."
That's seemingly what NBIX stock investors are doing right now. Shares remain well above their 50-day moving average, according to MarketSmith.com.
Biotech stocks also hold a strong position. The industry group ranks second out of 197 groups Investor's Business Daily tracks. In that group, Neurocrine stock is fourth by Composite Rating. Its CR of 96 puts NBIX stock in the top 4% of all stocks for fundamental and technical measures, according to IBD Digital.
Meanwhile, Neurocrine's relative strength line is at a 52-week high. Shares have a Relative Strength Rating of 92. This puts NBIX stock in the leading 8% of all stocks in terms of 12-month performance.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
