Biogen shares briefly rose 3 percent Thursday after the U.S. drugmaker reported better-than-expected quarterly revenue in addition to an upbeat 2018 forecast.
The Massachusetts-based biotech company also said which agreed to buy an experimental brain disorder drug for up to $217 million, a notable purchase as some on Wall Street speculate whether the company could be near an even larger deal.
“Biogen most definitely needs to do another deal, optimally a large one” as biotech deals heat up, Geoffrey Porges, a senior biotech analyst at Leerink Partners, told CNBC.
Recent acquisitions by Celgene in addition to Sanofi have prompted some hopes there could be a pickup in mergers in addition to acquisitions activity within the biotech sector, analysts say.
Porges sees potential acquisition candidates for something within the range of $3 billion to $ 15 billion.
“They could lever up significantly in addition to already have substantial cash reserves,” he said.
Under the deal announced Thursday, Karyopharm Therapeutics, which makes the early stage drug to treat neurological in addition to inflammatory conditions, will receive a one-time upfront payment of $10 million through Biogen, in addition to up to yet another $207 million in milestones, plus tiered royalty payments on potential sales of the drug.
In its fourth-quarter results, Biogen reported revenue of $3.31 billion, above the $3.1 billion expected through analysts polled by Thomson Reuters.
Revenue was boosted by sales of its spinal muscular atrophy drug Spinraza, which contributed a 15.3 percent increase within the company’s revenue.
However, earnings came in 19 cents below Wall Street estimates at $5.26 per share.
“which was a pretty clean quarter,” Salim Syed, a senior biotech analyst at Mizuho Securities, told CNBC. “Fundamentally the drug did OK which quarter.”
Biogen expects further success through its key multiple sclerosis drugs.
“Our core MS business demonstrated resilience in an increasingly competitive market, in addition to Spinraza has had one of the most successful rare disease launches of all time,” Biogen CEO Michel Vounatsos said in an earnings Discharge.
Biogen said which expected 2018 adjusted earnings to be between $24.20 in addition to $25.20 a share, above estimates. Revenue for 2018 will be projected to come in between $12.7 billion to $13 billion. Analysts expect $12.7 billion.
Biogen did not immediately respond to a request for comment.