Regeneron’s Covid-19 Antibody Cocktail Wins FDA Emergency Use Nod

Regeneron announced that its REGN-COV2 investigational antibody cocktail therapy for the treatment of COVID-19, has been granted Emergency Use Authorization (EUA) by the US Food and Drug Administration (FDA).

Regeneron (REGN) said that REGN-COV2 is now authorized for the treatment of mild to moderate COVID-19 in adults, as well as in pediatric patients at least 12 years of age with positive results of direct SARS-CoV-2 viral testing and who are at high risk for progressing to severe COVID-19. This includes those who are 65 years of age or older. The FDA noted though that REGN-COV2 is not authorized for patients who are hospitalized due to COVID-19 or require oxygen therapy due to virus infection.

REGN-COV2 is a combination of two monoclonal antibodies (REGN10933 and REGN10987) and was designed specifically to block infectivity of SARS-CoV-2, the virus that causes COVID-19. In a clinical trial of patients with COVID-19, the administration of the experimental antibody cocktail was shown to reduce COVID-19-related hospitalization or emergency room visits in patients at high risk for disease progression within 28 days after treatment when compared to placebo.

Regeneron now expects to have REGN-COV2 treatment doses ready for approximately 80,000 patients by the end of November, approximately 200,000 patients by the first week of January, and approximately 300,000 patients in total by the end of January 2021.

“This FDA Emergency Use Authorization is an important step in the fight against COVID-19, as high-risk patients in the United States will have access to a promising therapy early in the course of their infection,” said Regeneron CEO Leonard S. Schleifer. “Even with these incredible efforts, demand may exceed supply initially, making it even more critical that federal and state governments ensure REGN-COV2 is distributed fairly and equitably to the patients most in need. In the first quarter of 2021, we expect to increase available REGN-COV2 global supply as we continue our collaboration with Roche.”

Meanwhile, REGN-COV2 continues to be assessed in Phase 2/3 clinical trials for the treatment of COVID-19 in hospitalized and non-hospitalized patients, the Phase 3 open-label trial of hospitalized patients in the UK, and a Phase 3 trial for the prevention of COVID-19 in household contacts of infected individuals. To date, more than 7,000 people have participated in REGN-COV2 clinical trials.

Shares in Regeneron have declined 8.4% over the past week but are up 38% on a year-to-date basis. That’s with a cautiously optimistic Moderate Buy consensus on the stock, alongside an average analyst price target of $678.73, indicating upside potential of another 31% lies ahead.

J.P. Morgan analyst Cory Kasimov said that while REGN continues to execute well and drive impressive growth, valuation forms the basis of his Hold rating and $550 price target.

“While we are encouraged by its innovative platform that has contributed to its broad pipeline, we believe longer-term questions on the commercial front may keep shares relatively range-bound,” Kasimov commented in a note to investors. “Investors will remain focused on COVID-19 development efforts. We broadly see promising potential for the newly launched/later-stage assets (e.g., Dupixent), although we suspect investors are already ascribing meaningful value based on data to date and relative market opportunities.” (See Regeneron stock analysis).