What drove REGN's earnings surprises in 2024?

Regeneron Pharmaceuticals Inc. (REGN) experienced notable earnings surprises in 2024, driven by strong revenue growth across its key products and strategic initiatives. Here's a detailed analysis:

1. **Robust Revenue Growth**: Regeneron reported significant increases in total revenue for Q2 and Q3 2024, with Q2 revenue reaching $3.55 billion, a 12% increase year-over-year, and Q3 revenue amounting to $3.72 billion, an 11% increase year-over-year. This growth was fueled by strong sales of key products such as EYLEA HD and Dupixent, as well as increased collaboration revenues from Sanofi and Bayer.
2. **Key Product Performance**:
- **EYLEA HD and EYLEA**: Net sales grew by 3% to $1.54 billion, with EYLEA HD contributing $304 million. Despite a slight decline in U.S. net sales by 11% year-over-year, the addition of new patients and transition from EYLEA to EYLEA HD helped maintain overall growth.
- **Dupixent**: Global net sales surged by 29% to $3.56 billion on a constant currency basis. Recorded by Sanofi, Dupixent's growth was notable across all approved indications and geographies, highlighting robust demand and market expansion.
- **Libtayo**: Global net sales increased by 43% to $297 million on a constant currency basis. The drug's growth was driven by expanded market reach in non-melanoma skin cancers and showed promise in non-small cell lung cancer.
3. **Strategic Initiatives**: Regeneron's continued investments in its pipeline and clinical manufacturing costs are evident, with approximately 40 product candidates in clinical development. The company's pipeline includes monoclonal and bispecific antibodies, collaborating with Sanofi and others, and exploring new technologies like RNAi and CRISPR-based gene editing.
4. **Financial Metrics**: Regeneron's GAAP diluted EPS increased by 30% to $11.54, reflecting strong operational performance. Net income rose by 33% to $1.34 billion, indicating robust profitability.
5. **Share Repurchases**: Regeneron's share repurchase program was active, with over $1.6 billion repurchased through the first nine months of 2024. This reflects the company's confidence in its cash flow generation and commitment to returning value to shareholders.

In conclusion, Regeneron's earnings surprises in 2024 were primarily driven by strong revenue growth from key products, strategic initiatives, and effective financial management. The company's robust pipeline and collaborations position it well for future growth and innovation.