4. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)
Stake Value as of Q2 2024: $734,197,383
Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is an American biotechnology company that uses scientific innovation to develop transformative medicines for patients with serious diseases. It is headquartered in Boston, Massachusetts.
During Q2 2024, the company reported revenues worth $2.65 billion, up 6% from last year, driven by its cystic fibrosis (CF) treatments and a reduction in channel inventory in international markets. Revenue grew a solid 7% in the United States during the quarter amid strong demand for TRIKAFTA, a mixed dose medication used to treat CF. Outside the US, the company noted a 5% surge in sales, attributed to an increase in the use of KAFTRIO among children.
After the robust quarter, Vertex Pharmaceutical raised its product revenue guidance for the full year 2024 to between $10.65 billion and $10.85 billion, indicating a 9% revenue growth at the midpoint. The company anticipates upcoming commercial launches of new medicines to contribute to revenue growth in the quarters ahead. One of these is CASGEVI, which will be used to treat patients with beta-thalassemia and sickle cell disease (SCD). Vertex is also optimistic about the clinical benefits of Vanzacaftor, a new drug for the treatment of people aged 6 and above living with CF. It received FDA approval in July this year.
The biotechnology firm’s financial position also remains strong, as it ended Q2 with $10.2 billion in cash and equivalents. The bullish sentiment around the stock was further strengthened in April with the $4.9 billion acquisition of Alpine Immune Sciences, with which Vertex gained access to treatments for autoimmune diseases related to the kidney. PGIM Jennison Health Sciences Fund stated the following regarding Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) in its Q2 2024 investor letter:
Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is a commercial stage biopharmaceutical with a core franchise of small molecule CFTR modulators for cystic fibrosis (CF), a genetic and progressively fatal respiratory disease. Vertex has built a unique and unrivaled market position as the dominant market leader in CF, having created and expanded the market into a nearly $10B franchise and growing. Later this year, we expect them to receive approval for their next-gen CF triple therapy, which we think will drive top-line growth and margin expansion in 2025 onwards. Vertex is also developing an acute and chronic pain franchise. Vertex reported positive Phase 3 data in acute pain and Phase 2 data in chronic pain earlier this year; the FDA filing in acute pain has been completed, and pending approval, Vertex expects to launch in acute pain in early 2025. Beyond CF and pain, Vertex has focused its pipeline around genetically driven diseases with the potential for a transformative clinical benefit. It currently spans 5 disease verticals: sickle cell/beta thalassemia, type 1 diabetes, APOL-1 kidney disease, IgA nephropathy (from the recent acquisition of Alpine Immune Sciences), and alpha-1 antitrypsin disease. Vertex has had a strong start to the year and has delivered positively on several clinical trial readouts, as well as beat Q1 revenue estimates and maintained what was a better than expected ’24 guidance. Vertex has a busy catalyst calendar in 2H24 which include next-gen CF approval, acute pain approval for their first-in-class pain drug, and additional data sets in chronic pain.
Wall Street analysts have consensus on the stock’s Buy rating and expect a share price appreciation of over 9%. It is one of the best stocks to buy from the Renaissance Technologies portfolio, with the hedge fund having a stake of $734 million in the company.
