Eylea may be giving Regeneron trouble in the U.S., but it's pumping up for Bayer in EU

Bayer has been reaping the benefits from hot launcher Eylea since the drug made its European debut in November 2012. But even with the eye med's success so far, Eylea's market potential may be a bit underestimated, one analyst believes.

According to Bernstein's Ronny Gal, while the wet age-related macular degeneration market--Eylea's first--"appears to be saturating," there's plenty of room to grow in other indications. In particular, use of so-called VEG-F products such as Eylea in patients with diabetic macular edema is expanding, giving the treatment an opportunity to outshine Bayer's current sales forecasts.

For one, Eylea "has share gain potential" from its first-to-market competitor, Novartis' ($NVS) Lucentis, Gal wrote in a recent note to clients. And payers seem "unlikely to materially engage on the category" in the near term, giving the pair space to go at it in a head-to-head battle.

Overall, he sees Eylea raking in €2.5 billion by 2020, "significantly ahead of the €1.5 billion guided by Bayer"--and likewise ahead of the estimated €1.2 billion the med chipped in in 2015 sales.

After 2020, though, it could be a different story. At that point, competition could get tougher for both Eylea and Lucentis, Gal notes, with "a wave of new products" emerging on the scene--including complementary therapies, long-lasting VEG-F alternatives, and biosimilars.

Just how much that'll hurt Bayer--and U.S. marketer Regeneron ($REGN)--remains to be seen, though--especially considering that the pair "almost certainly" has a long-term plan of its own.

The "magnitude and timing" of the impact "is still an open question," he wrote.

Meanwhile, Regeneron is predicting a slowdown in the U.S. for its superstar in 2016, it said earlier this month. While the Tarrytown, NY-based biotech still forecasts 20% for the blockbuster at home, that's less than half of the expansion it saw in 2015, when sales grew 54% to hit $2.68 billion.

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