Although many popular biotech stocks peaked in 2020 and early 2021 and then started to decline, early 2024 has seen signs of recovery and a return of investors’ trust. Nonetheless, this biotech stock powered through the period, achieving miracle growth and maintaining its decades-long tradition of positive returns.
The biotech stock in today’s limelight is BioMarin Pharmaceutical (NASDAQ: BMRN), a biotechnology and pharmaceutical company focusing on tackling rare genetic diseases through an innovative portfolio of therapies and products. Founded in 1997 and publicly traded since 1999, it averaged significant returns through decades of its existence, cultivating the trust of its shareholders.
About BioMarin Pharmaceutical
Founded in 1997 and based in San Rafael, California, BioMarin Pharmaceutical has offices and facilities worldwide. It was the first company to offer therapeutics for mucopolysaccharidosis type I and phenylketonuria. Its core products include orphan drugs like Vimizim (the only enzyme replacement therapy for Morquio A Syndrome, a skeletal development condition), Kuvan (for the treatment of phenylketonuria), and Naglazyme (used to treat Maroteaux-Lamy syndrome, a lysosomal storage disorder).
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With a developed and robust product pipeline and a tradition of successful innovative therapies, BioMarin boasts solid growth potential despite the recent stagnation of the wider biotech industry. Its position in precision medicine and gene therapy secures it in a rapidly evolving biotech and healthcare markets. Considering everything, BioMarin has significant potential for long-term value appreciation within its sector.
BioMarin Pharmaceutical trades on the NASDAQ stock exchange under the BMRN ticker symbol.
BioMarin Pharmaceutical stock price today
At the time of writing, BioMarin Pharmaceutical stock price stands at $84.39, reflecting a slight decrease of 12.50% year-to-date.
BioMarin Pharmaceutical financial performance
On February 26, 2024, the company filed the annual 10-K report with the SEC, giving comprehensive insight into its finances. The financial tables reflect a commendable performance, with a market capitalization of $10.1 billion and an expanded portfolio with recently green-lighted therapies like Roctavian and Voxzogo.
The report also showed improvements over the same one from 2022:
- Revenue: $2.42 billion (up 15% from 2022);
- Net income: $167.6 million (up 18% from 2022);
- Profit margin: 6.9% (up from 6.8% in 2022 due to higher revenue);
- Earnings per share: $0.89 (up from US$0.76 in 2022).
When it comes to returns in the past, the company had a period of slightly negative net income until early 2020 when it recorded substantial profits and returns. However, after the end of the “golden age of biotech” in late 2021, BioMarin Pharmaceutical kept booking net returns while most of its established competitors started backsliding.
Coupled with their consistent growth over the years, this could signal a sturdy pace of growing returns, which is not that common today in the industry many investors decided to turn their backs on.
Investing in BioMarin Pharmaceutical stock: Pros & cons
Pros
- The global leader in rare-disease therapies: BioMarin Pharmaceutical specializes in rare-disease therapies within the biotech sector. Its brand strength is reinforced by patented treatments and minimal competition in the U.S. and EU markets. This advantageous position enables the company to capture significant market share and sustain high prices per patient, bolstering its profitability;
- Robust portfolio: BioMarin holds numerous registered trademarks for its crucial products. By actively bolstering and expanding its patent portfolio through new filings, prosecutions, and strategic acquisitions, the company gains a competitive advantage and removes obstacles for potential competitors. This proactive management of intellectual property guarantees sustained market exclusivity and revenue streams in the long term.
Cons
- Coverage reliance: The high cost of rare-disease therapies requires hefty coverage and reimbursement from governments and other payers. This reliance puts BioMarin at a financial risk, as shifts in these coverages might negatively affect the company’s profitability. This reliance on subsidies and coverages makes the company susceptible to changes in healthcare policies and legislation;
- Generic competition: The generic iteration of Kuvan from competitors has reduced BioMarin’s revenues, showing the company’s weakness in this trend. As patents expire, the onslaught of generic therapies remains a significant vulnerability that could cause a decline in revenues.
Looking forward: What is the price prediction for BMRN stock?
Despite the recent slowdown of biotech stocks, BioMarin Pharmaceutical has maintained above-average growth and shown commendable financial indicators. If the company keeps up the pace of innovation and maintains the leading position in its niche, it will have a substantial chance of remaining a profitable investment opportunity.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
