Neurocrine stock crashed to a three-month low Friday after the company's bread-and-butter drug and its guidance for 2025 both lagged Wall Street's expectations.
The company is best known for its drug, Ingrezza. Ingrezza treats tardive dyskinesia and chorea associated with Huntington's disease. Both are movement disorders. But in the fourth quarter, Ingrezza sales came in light at $615 million. Analysts called for a higher $623 million.
Neurocrine Biosciences offered a light outlook for 2025. The firm expects $2.5 billion to $2.6 billion in sales this year. The high end of the outlook completely missed analysts' call for $2.67 billion in sales. At the midpoint, sales would grow just 11%. In comparison, Ingrezza sales surged 26% in 2024.
"It certainly is unusual to see growth of a product drop from 25% to 10% so quickly, so maybe the company is being conservative, but it's difficult to know," Leerink Partners analyst Marc Goodman said in a client note.
Neurocrine stock tumbled 18.5%, closing at 122.62. Shares had run up almost 36% after hitting a recent low point in October, and recently broke out of a cup-with-handle base with a buy point at 140 on Jan. 10, according to MarketSurge.
The move Friday sent shares careening into a sell zone. Savvy investors are encouraged to cut their losses when a stock falls 7% to 8% below its entry. At its lowest point, Neurocrine shares were 11% below the 140 price target.
Neurocrine Stock: Ingrezza Sales Miss
During the fourth quarter, Neurocrine earned an adjusted $1.69 per share on $627.7 million in revenue. Earnings rose almost 10% and beat forecasts for $1.58 a share, according to FactSet. Sales cruised almost 22% higher, but missed expectations for $629 million.
Neurocrine pointed to more stringent utilization of Ingrezza in the quarter, including physicians asking for prior authorization from insurance before starting patients on Ingrezza. Neurocrine's main competitor in this space is Teva Pharmaceutical with its drug Austedo. Teva is feeling bullish on Austedo this year, guiding to $1.9 billion to $2 billion in sales.
This implies "some taking of tardive dyskinesia (TD) market share if that were to come to fruition," William Blair analyst Myles Minter said in a report.
Crenessity Makes Its Debut
This was also the first quarter that included sales from Crenessity, Neurocrine's new treatment for congenital adrenal hyperplasia, or CAH. CAH is a genetic condition that leads to the overproduction of male hormones known as androgens. Crenessity is the first treatment that doesn't rely on glucocorticoids, which carry a host of side effects.
Crenessity brought in $2 million in sales during the quarter.
But RBC Capital Markets analyst Brian Abrahams expects a fairly slow launch.
"We continue to believe that while there may be a small initial bolus of starts mostly among (pediatric) pts who are already plugged into CAH specialists in academic centers, the limited patient organization, need for proactive GC down-titration, modest (effectiveness) and infrequent doctor visits will all lead to a more gradual launch and ultimate uptake," he said in a report.
Abrahams rates Neurocrine stock a sector perform and cut his price target to 148 from 154.
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