Pharma companies worldwide scrambled to respond to the COVID-19 pandemic early last year, but so far only a few have advanced therapies and vaccines through to the market. Regeneron is one, and now the drugmaker's antibody cocktail could bring a multibillion-dollar windfall in 2021.
After previously agreeing to supply the U.S. government with 300,000 doses of its antibody cocktail, Regeneron this week inked a much larger supply deal for up to 1.25 million doses. If the company is able to supply all doses, the deal will come out to $2.63 billion.
Under the agreement, the government will pay Regeneron for any doses it’s able to produce by the end of June. The government can also purchase any additional doses past that point at its discretion.
Regeneron’s antibody cocktail is authorized for COVID-19 patients with mild to moderate cases who are at a risk of progressing to severe disease. It's already green-lighted at a dose of 2,400mg, or 1,200mg each of components casirivimab and imdevimab, but the company is testing a dose half that size. If Regeneron is able to score an FDA authorization for the lower dose, the company expects to be able to fulfill the entire order by the end of June.
At the higher dose, the company expects to be able to produce around 750,000 doses by June 30.
Despite the new deal, antibody supply hasn’t necessarily been the big issue for Regeneron's treatment and a similar antibody therapy from Eli Lilly in recent months.
Since the drugs are authorized in mild and moderate cases, the patients who could benefit aren’t in a healthcare setting where they could be infused. In response to that hurdle, states and hospital groups created specialized infusion centers to boost usage.
At Regeneron’s presentation during the J.P. Morgan Healthcare Conference this week, R&D chief George Yancopoulos said society has to do a “much better job” getting the antibody therapies to patients.
“Right now, the vaccine is not helping any of these people,” he added. “The only thing that can really help these people … are these antibody therapies."
Regeneron’s first antibody deliveries to the U.S. government yielded sales of $144 million in the fourth quarter, the company reported. The number was lower than some investors expected, but more deliveries are set for the first-quarter of 2021, CEO Len Schleifer said.
Reacting to news of the deal, Barclays analysts wrote that they expected Regeneron and the U.S. government to negotiate another supply agreement, but that the terms "far exceed our expectations." And while Piper Sandler analysts raised the question over the profit split between Regeneron and manufacturing partner Roche, they added $1.6 billion to their Regeneron revenue projections this year.
Meanwhile, Eli Lilly is also producing and delivering its own antibody, bamlanivimab, to the U.S. government, which has negotiated a purchase of 950,000 doses through the end of this month. Between the two regimens, 414,000 patient courses have been delivered to states and other entities so far, according to government data.