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Biogen's new MS drug tops expectations; ups 2013 forecast

By Bill Berkrot

Oct 28 (Reuters) - Biogen Idec Inc on Monday reported $286 million in third-quarter sales of its high-profile new multiple sclerosis drug Tecfidera, providing fresh evidence that the medicine is off to an impressive launch and exceeding all expectations.

The company also reported higher-than-expected third-quarter earnings and raised its full-year profit and revenue forecasts, and its shares rose nearly 4 percent before paring gains.

In just its second quarter on the market, Tecfidera sales easily topped Wall Street analysts' increased forecasts of between $205 million and $235 million. It had chalked up sales of $192 million in its first quarter on the market, surpassing initial Wall Street estimates of about $66 million.

"Tecfidera crushed (expectations)," ISI Group analyst Mark Schoenebaum said in a research note. "This is really, truly incredible."

Tecfidera is the third oral MS drug to market after Gilenya from Novartis and Sanofi's Aubagio, but is seen as likely to dominate the class. According to IMS, which provides data on prescription medicines, it has already laid claim to being the leading oral drug for multiple sclerosis after just six months, Biogen said.

More than 5,000 doctors had already prescribed Tecfidera, Biogen said, with about three-quarters of patients switching over from other drugs, including older Biogen products.

Analysts consider the drug to be Biogen's most important future growth driver and forecast eventual peak annual sales in excess of $3 billion.

"The company commentary suggests that the spectacular launch trajectory has started to slow down, but it's still on track to becoming a dominant, if not the dominant, treatment for MS," Sanford Bernstein analyst Geoffrey Porges said.

The company provided no new details on its efforts to ensure patent protection for Tecfidera in Europe but suggested an approval decision could be coming soon. The drug is approved in Canada and Australia, as well as the United States.

Biogen cautioned that there was a possibility of an approval delay for its experimental long-acting drug for hemophilia A, eloctate. It said discussions with the U.S. Food and Drug Administration involved manufacturing issues and not safety of the treatment.

"We're not talking jeopardy to approval here, we're talking time lines," Biogen Chief Executive George Scangos told analysts on a conference call.

Eloctate approval had been expected late in the first quarter or early in the second quarter of 2014.

"We were expecting a time to market advantage," said Bernstein's Porges. "If this is a three- to six-month delay it narrows the window to convert patients before rivals come to market."

The U.S. biotechnology company said net profit for the quarter rose to $488 million, or $2.05 per share, from $398 million, or $1.67 per share, a year before.

Excluding items, Biogen had adjusted earnings of $2.35 per share, topping analysts' average expectations by 25 cents, according to Thomson Reuters I/B/E/S.

Biogen said it now expects 2013 earnings, excluding items, of $8.65 to $8.85, up from its prior forecast of $8.25 to $8.50 per share. Wall Street is forecasting earnings of $8.62 per share for the year.

Biogen now sees full-year revenue growth of 23 percent to 25 percent. It had previously projected growth of 22 percent to 23 percent.

Revenue for the quarter rose 32 percent to $1.8 billion, edging past Wall Street estimates of $1.78 billion.

Sales of Biogen's older injectable MS drug Avonex decreased slightly to $733.4 million from $736.2 million a year ago, as the drug likely lost some sales to the company's own new drug.

Biogen reported a 46 percent increase in sales of its other injectable MS drug Tysabri to $401 million, largely due to the company's acquisition of the portion of the medicine held by Irish drugmaker Elan Corp earlier this year. Biogen now owns full rights to Tysabri.

The company also recorded $303 million from its portion of sales of Rituxan, the lymphoma drug it shares with Roche Holding AG.

Biogen Idec shares were up 35 cents to $252 in morning trading on Nasdaq after earlier reaching a new high of $262. The company's shares were already up about 70 percent this year, largely due to Tecfidera enthusiasm.