Neurocrine Biosciences (NBIX) is nearing a buy point amid rising enthusiasm.

Neurocrine Biosciences (NBIX), a leading neuroscience-focused biopharmaceutical company, is approaching a buy point as market excitement heats up. The stock has surged more than 19% in the past six months and nearly 42% in the past year.

One of the factors fueling this optimism is NBIX’s flagship product, INGREZZA.®Diagnosis rates for these drugs, which target tardive dyskinesia, a movement disorder associated with certain antipsychotic drugs, are increasing. The launch of INGREZZA in 2017 sparked interest in this little-known disease.

Moreover, Neurocrine’s early-stage plan to target muscarinic receptors in the brain has attracted investor interest. This research could potentially lead to new treatments for a variety of movement disorders, schizophrenia and other central nervous system diseases.

Now, let’s take a closer look at NBIX’s fundamentals and growth prospects.

Promising Recent Developments

On May 8, NBIX announced the initiation of a first-in-human Phase 1 clinical study to evaluate safety, tolerability, pharmacokinetics, and pharmacodynamics. Investigational Compound NBI-1117567 For adult participants. NBI-1117567 is an oral, investigational, M1/M4 (M1 preferred) selective muscarinic agonist for the potential treatment of psychiatric and neurological disorders.

On April 30, NBIX announced: FDA APPROVED INGREZZA® SPPRINKLE CAPSULES, introducing a new oral granular version of INGREZZA® capsules, indicated to treat adults with tardive dyskinesia and chorea associated with Huntington’s disease. INGREZZA SPRINKLE provides an alternative option and is especially beneficial for individuals who have trouble swallowing or who have trouble swallowing.

Neurocrine also reported: Positive Topline Data from Phase 2 SAVITRI™ Study This was a randomized, double-blind, placebo-controlled, dose-finding trial designed to evaluate the efficacy and safety of NBI-1065845 in adults with major depressive disorder (MDD).

NBI-1065845 is an investigational alpha-amino-3-hydroxy-5-methyl-4-isoxazole propionic acid (AMPA) positive allosteric modulator (PAM) for the treatment of patients with MDD who have not responded adequately to at least one antidepressant. For potential treatment. While currently experiencing depression.

Also in the same month, NBIX and Sentia Medical Sciences Inc. Expanding research cooperation Discovering new long-acting corticotropin-releasing factor (CRF) receptor antagonist peptide therapeutics.

This partnership will continue to leverage Sentia’s proprietary peptide-based platform and Neurocrine’s drug development expertise in CRF biology to develop medicines with the potential to treat a variety of hypothalamic-pituitary-adrenal (HPA) axis-regulated diseases. , will manufacture and commercialize it.

Last March, Neurocrine announced the start of a Phase 1 clinical study to evaluate safety, tolerability, pharmacokinetics, and pharmacodynamics. Research Compound NBI-1065890 In healthy adult subjects.

NBI-1065890 is a next-generation, highly potent, internally discovered, oral, selective vesicular monoamine transporter-2 (VMAT2) inhibitor for the potential treatment of certain neurological and neuropsychiatric disorders.

Moreover, NBIX is poised to become a leader in neuroscience with its recent New Drug Application submission for crinecerfont and optimistic Phase 2 results for NBI-‘845 (a potential first-in-class drug for major depression).

Solid First Quarter 2024 Financial Results

for First quarter ended March 31, 2024, NBIX’s revenue increased 22.6% year over year to $515.3 million. This exceeded analysts’ estimates of $512.01 million. Net product sales increased 22.7% year over year to $509 million, while INGREZZA net product sales increased 23% year over year to $506 million.

Year-over-year growth in INGREZZA product sales was driven by robust underlying patient demand and improved gross net dynamics. Additionally, Neurocrine’s non-GAAP net income and earnings per share of $124.8 million and $1.20 per share compared to non-GAAP net loss of $49.5 million and loss per share of $0.51 in the first quarter of 2023.

Additionally, the company had total cash, cash equivalents and marketable securities of $1.91 billion as of March 31, 2024, compared to $1.72 billion as of December 31, 2023.

Optimistic analyst expectations

Analysts expect NBIX’s revenue to hit $547.13 million in the second quarter ending June 2024, up 20.9% year-over-year. The consensus EPS estimate of $1.49 for the quarter represents a 19.3% improvement over the year-ago period. Moreover, Neurocrine has topped consensus revenue and EPS estimates in three of the last four quarters, which is surprising.

Additionally, NBIX’s fiscal year (ending December 2024) revenue and EPS are expected to grow 17.7% and 54.8% year-on-year, respectively, to $2.22 billion and $5.98. The Street expects the company’s revenue and EPS to hit $2.54 billion and $7.34 in fiscal 2025, up 14.4% and 22.9%, respectively, from the previous year.

Favorable trends and dynamics in the pharmaceutical industry

Demand for pharmaceuticals and healthcare services is increasing globally due to population growth, aging populations, and increasing prevalence of chronic diseases. Additionally, regulators are increasingly implementing expedited review pathways and flexible approval processes to accelerate innovation and access to new treatments.

According to Statista, sales of the pharmaceutical market are expected to reach $1.16 trillion by 2024. Comparing globally, the United States is expected to generate the highest revenue this year at $636.9 billion. Going forward, sales in this segment are expected to continue to increase. Average annual growth rate 6.2% From 2024 to 2028, the market size is expected to reach $1.47 trillion by 2028.

Moreover, advancements in biopharmaceuticals, increasing adoption of precision medicine approaches, increasing investments in specialty medicines targeting specific diseases or patient populations, and orphan medicines for rare diseases are key trends shaping the pharmaceutical sector.

Ace from IQVIA, U.S. pharmaceutical spending is expected to increase by 4 to 7 percent. This growth will be fueled by the adoption of newly launched innovative products, such as medicines for oncology or rare conditions, along with several traditional treatments, with an average of 50-55 new drugs launched each year over the next five years. In the fields of diabetes, neurology and obesity.

Accelerate Profitability

NBIX’s trailing 12-month gross margin of 68.54% is 21.7% higher than the industry average of 56.34%. Likewise, the stock’s trailing 12-month EBIT margin and leveraged FCF margin of 23.73% and 36.29%, respectively, are significantly higher than the industry average of 0.53%.

Moreover, the stock’s trailing 12-month net income margin is 18.65% compared to the industry average of minus 5.52%. Trailing 12-month ROCE, ROTC, and ROTA are 18.16%, 12.36%, and 10.65%, respectively, which compare favorably to their respective industry averages of minus 40.87%, minus 20.89%, and minus 29.54%.

conclusion

Neurocrine reported excellent results for the first quarter of 2024, with revenue exceeding analyst expectations. The neuroscience-focused biopharmaceutical company’s INGREZZA® net product sales contributed significantly, recording 23% year-over-year growth, driven by robust patient demand and improved gross net dynamics.

Dr. Kevin Gorman, CEP at NBIX, expressed confidence in the company’s lead product, INGREZZA, while emphasizing the continued need for treatment for patients with tardive dyskinesia.

In fiscal 2024, the company expects INGREZZA net product sales to range from $2.1 billion to $2.2 billion.

Neurocrine is also actively pursuing strategic initiatives to develop medicines to alleviate the burden of debilitating diseases and disabilities. This includes ongoing research and development (R&D) efforts to create new and effective treatments for neurological, neuroendocrine, and neuropsychiatric disorders.

Wells Fargo analyst Mohit Bansal Maintain BUY rating on NBIX, the target price is $170. Mohit Bansal has assigned a Buy rating to Neurocrine due to several factors that point to its solid business fundamentals and bright future development. The company’s flagship product, INGREZZA, delivered solid performance, contributing to increased operating margins and serving as a solid foundation for the business.

Additionally, according to analysts, Neurocrine is actively preparing to launch its upcoming new drug, crinecerfont, and management has expressed confidence in the likelihood of priority review by the FDA. Bansal also highlights the company’s proactive approach to ensuring study quality, which bodes well for future clinical trials.

Considering these factors, it may be wise to scoop up shares of NBIX for potential profits.