Jazz Pharmaceuticals JAZZ reported adjusted earnings of $4.21 per share for the fourth quarter of 2021, beating the Zacks Consensus Estimate of $3.71. Earnings rose 5.3% year over year.

Total revenues in the reported quarter rose 35% year over year to $897.0 million, beating the Zacks Consensus Estimate of $861 million. The increase was driven by sales of new drugs and drugs added from the acquisition of GW Pharmaceuticals.

Net product sales increased 35% from the year-ago quarter to $892.9 million. In the quarter, 59% of Jazz’ net product sales came from newly launched and acquired products.

Royalties and contract revenues declined 8.7% to $3.9 million in the quarter.

Jazz’s stock was up 2.5% in after-hours trading on Mar 1 after the results were announced. This year so far, Jazz’s shares have risen 7.3%, in contrast to the industry’s decrease of 13.4%.

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Sales of Jazz’s neuroscience products increased 48% to $684.8 million.

Net product sales for the combined oxybate business (Xyrem + Xywav) increased 4% to $471.4 million in the quarter. Sales of Xyrem, approved to treat cataplexy and excessive daytime sleepiness (“EDS”) in narcolepsy patients, declined 34% year over year to $288.8 million due to patients switching to Xywav. Jazz expects an authorized generic version of Xyrem to be launched by Hikima Pharmaceuticals in the second half of 2022.

Xywav is a low sodium formulation and a Xyrem follow-on product to treat EDS or cataplexy in narcolepsy patients. Xywav recorded sales of $182.7 million in the quarter compared with $153.1 million in the previous quarter. At the end of the fourth quarter, Jazz had approximately 6,900 active Xywav patients, up from 6,000 at the end of third-quarter 2021. Jazz launched Xyway for a new indication — idiopathic hypersomnia (IH) — in November 2021. For the IH indication, the company saw positive early launch momentum with approximately 250 active Xywav patients with IH as of the end of the fourth quarter.

Another new drug, Sunosi recorded sales of $14.9 million in the quarter, up 71%.

Sales of Epidiolex/Epidyolex rose 35% (on a proforma basis) to $193.8 million due to a temporary increase in specialty pharmacy inventory levels. Excluding this temporary benefit, Epidiolex/ Epidyolex sales rose 10% on a sequential basis in the fourth quarter. Epidiolex, which is approved for the treatment of seizures associated with two rare and severe forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome, was added to Jazz’s pipeline with the GW Pharmaceuticals acquisition in 2021. Jazz is making significant progress with respect to the launch of Epidyolex in Europe.

Another drug added with the GW Pharma acquisition was Sativex, a cannabis-based mouth spray for multiple sclerosis-related spasticity, which is approved in Europe but not in the United States. The drug recorded sales of $4.6 million in the quarter.

Oncology product sales increased 5.4% to $207.1 million.

New drug Zepzelca (lurbinectedin) recorded sales of $64.8 million in the quarter compared with $71.7 million in the previous quarter. Zepzelca was launched for second-line small cell lung cancer in the U.S. market in July 2020.

Acute myeloid leukemia drug, Vyxeos generated sales of $34.8 million, up 12% from the year-ago period.

New drug Rylaze (JZP458) recorded sales of $65.0 million in the quarter compared with $20.7 million in the previous quarter, reflecting the drug’s strong early demand and an initial buildup of inventory. Rylaze was launched in July in the United States for treating acute lymphoblastic leukemia (ALL) patients who have developed hypersensitivity to E.coli-derived asparaginase. Regulatory applications in Europe are expected to be filed in mid-2022.

Defitelio sales increased 23% to $42.5 million in the quarter.

Adjusted selling, general and administrative (SG&A) expenses surged 45.8% to $328.7 million to support higher headcount costs and recent launches. Adjusted research and development (R&D) expenses increased 66.9% to $140.1 million mainly to support ongoing clinical activities of pipeline candidates of GW Pharmaceuticals.

JAZZ Q4 Earnings Top, Sales Ride on New & Acquired Drugs Edit My Quotes

Jazz reported adjusted earnings of $16.23 per share in 2021, up 30.3% year over year.

Total revenues in the reported quarter rose 31% year over year to $3.09 billion. The total revenues included neuroscience and oncology revenues of $2.3 billion and $734 million, respectively, with both franchises delivering more than 30% growth compared to 2020. Jazz reported over $3 billion in total revenues for the first time in 2021 helped by five key launches in the year.

The company expects 2022 adjusted earnings in the range of $16.00-$17.00 per share. The Zacks Consensus Estimate stands at $17.02 per share.

Total revenues are expected to be in the range of $3.46-$3.66 billion, suggesting approximately 15% year-over-year growth at the midpoint compared to 2021. The Zacks Consensus Estimate for revenues stands at $3.62 billion. In 2022, Jazz expects at least 65% of net product sales to come from newly approved or acquired products.

Neuroscience sales are expected in the range of $2.56 billion-$2.76 billion, implying growth of 14% at the midpoint compared to 2021. The Oncology franchise is expected to record sales in the range of $840 million-$920 million, indicating growth of 20% at the midpoint compared to 2021.

While adjusted SG&A expenses are anticipated between $1.12 billion and $1.19 billion, adjusted R&D expenses are expected to be in the band of $560 million to $600 million.

Over the long term, Jazz expects to grow revenues to $5 billion in 2025 and get five novel product approvals by the end of the decade.

Jazz expects its adjusted operating margin to improve by 5 percentage points from 2021 to 2025.

Jazz currently carries a Zacks Rank #3 (Hold).

Jazz Pharmaceuticals PLC price-consensus-eps-surprise-chart | Jazz Pharmaceuticals PLC Quote

Some better-ranked stocks from the same sector include Catalyst Pharmaceuticals CPRX, Chinook Therapeutics KDNY and Assertio Holdings ASRT, all with a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The stock of Catalyst Pharmaceuticals has risen 111.7% in the past year. The Zacks Consensus Estimate for Catalyst Pharmaceuticals’ 2022 earnings has gone up from 50 cents to 71 cents over the past 60 days.

Catalyst Pharmaceuticals’ earnings surprise history has been mixed with its earnings beating estimates in three of the trailing four quarters and coming in line on one occasion. The company delivered an earnings surprise of 30.56%, on average.

Estimates for Assertio Holdings’ 2022 earnings have improved from 20 cents per share to 35 cents per share over the past 60 days. The stock has declined 50.9% in the past year.

Assertio Holdings delivered an earnings surprise of 33.3% in the last-reported quarter.

Chinook Therapeutics’ stock has declined 26.3% in the past year. Estimates for 2022 have narrowed from a loss of $3.02 per share to $2.84 per share over the past 60 days.

Chinook Therapeutics delivered an earnings surprise of 17.1% in the last- reported quarter.

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