Allergan, Inc. (AGN), Regeneron Pharmaceuticals Inc (REGN), And What You Should Know

Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on big changes — just in case they’re material to our investing thesis.

Editor’s note: This article was originally published yesterday.

What: Shares of biopharmaceutical companies Allergan, Inc. (NYSE:AGN) and Regeneron Pharmaceuticals Inc (NASDAQ:REGN) are heading in notably different directions today following an announcement from Allergan that data from its phase 2 study of vision-loss drug DARPin didn’t support proceeding to late-stage trials. Allergan shares fell 15% on the news while Regeneron shares spiked as much as 17%.

So what: It’s been a miserable day for Allergan, Inc. (NYSE:AGN), which started the day off by slightly lowering its full-year EPS forecast from a range of $4.75-$4.83 to $4.70-$4.76. To add the icing on the cake, its midday report that DARPin did show some differentiation from Novartis AG (ADR) (NYSE:NVS) and Roche (OTCBB:RHHBY)‘s Lucentis but didn’t demonstrate enough to move the drug onto phase 3 trials, sent Allergan into the abyss. It probably doesn’t help, either, that MAP’s inhaled migraine drug Levadex, which Allergan acquired when it purchased MAP for nearly $1 billion earlier this year, also recently received its second complete response letter. Allergan, Inc. (NYSE:AGN) just can’t seem to catch a break.

On the flipside, Regeneron Pharmaceuticals Inc (NASDAQ:REGN) shares are soaring on the news as DARPin would have been a direct competitor to its lead drug Eylea in terms of wet age-related macular degeneration. With DARPin’s development delayed, Eylea has a chance to continue to grow sales at a tremendous pace. Deutsche Bank AG (USA) (NYSE:DB) took the opportunity to boost its price target on Regeneron up to $310.