BioMarin Shifts Strategy: Abandons Roctavian, Faces Voxzogo Competition, and Adjusts Revenue Targets

BioMarin Pharmaceutical Inc. has announced significant changes to its business strategy, including the divestment of its hemophilia A gene therapy Roctavian and a revision of its long-term revenue projections. The company's decision comes amid growing competitive pressures and evolving market dynamics in the rare disease space.

Roctavian Divestment and Strategic Realignment

BioMarin's president and CEO Alexander Hardy revealed during the company's third-quarter earnings call that the biotech firm is actively seeking opportunities to divest Roctavian. This gene therapy, approved by the FDA in June 2023 for hemophilia A, has struggled to gain traction in the market, generating only $26 million in revenue for 2024.

"We are looking to make Roctavian accessible to those interested in a gene therapy treatment," Hardy stated, emphasizing the company's commitment to ensuring the asset reaches its "full potential." BioMarin will maintain commercial supply in the U.S., Germany, and Italy during the divestment process.

This move marks a significant shift from the company's previous plans, which had positioned Roctavian as a key component in reaching a $4 billion revenue target by 2027. The decision to divest aligns with BioMarin's focus on "business units aligned with our strategic priorities," as explained by Hardy.

Voxzogo Faces Impending Competition

Another factor influencing BioMarin's strategic shift is the competitive landscape surrounding Voxzogo, its therapy for achondroplasia. While Voxzogo contributed $218 million to BioMarin's third-quarter revenues, growing 15% year-on-year, the company anticipates increased competition in the near future.

Two competitors are approaching market entry:

1. Ascendis Pharma, with a target action date of November 30 for TransCon CNP
2. BridgeBio, developing a small-molecule drug addressing the root cause of achondroplasia

Chief Financial Officer Brian Mueller cited the "impact of potential Voxzogo competition" as a significant factor in the company's decision to withdraw its previous revenue target. This adjustment reflects a notable change in BioMarin's outlook, with analysts from Stifel describing it as "a 180 from management's prior steadfast confidence that Vox will be resilient/durable."

Revised Financial Outlook and Future Strategy

In light of these developments, BioMarin has adjusted its 2027 revenue projections. While the company has not provided formal guidance, executives informally suggested that 2027 revenues could fall between $3.65 billion and $4 billion, according to Stifel analysts.

To navigate this transition, BioMarin is emphasizing the importance of business development. The company completed a $270 million acquisition of Inozyme in March and has indicated it has around $2 billion in cash and $4-5 billion in capacity for further deals.

"Management called out many rare disease focused biotechs who are undercapitalized and under-resourced that represent attractive opportunities for BioMarin," noted analysts from Truist Securities.

As BioMarin adapts to these market challenges, the pharmaceutical industry will be closely watching how the company repositions itself in the competitive rare disease landscape.