Ipsen slips despite raising outlook on broad-based drug sales growth

Investing.com -- Shares in French drugmaker Ipsen SA slippedon Thursday even as the company’s second-quarter product sales of €1,115 million beat company-compiled consensus of €1,048 million by 6%, or €67 million, helped by strong Somatuline sales amid limited generic competition.

Second-quarter product sales grew 24.5% at constant exchange rates (CER) from €901 million a year earlier. Somatuline sales rose 29.7% at CER to €358 million, beating consensus of €330 million by 8%, or €27 million, driven by limited disruption from generic lanreotide.

First-half total sales rose 20.4% as reported, or 23.5% at CER, to €2,190.2 million from €1,819.8 million a year earlier, according to the company’s press release. First-half product sales of €2,190 million beat consensus of €2,123 million by 3.2%, or €67 million.

First-half core operating income rose 28.8% to €844.9 million from €655.8 million, with a core operating margin of 38.6%, beating consensus of 36.0% by 261 basis points.

First-half core consolidated net profit rose 19.6% to €607.7 million from €508.3 million, and core earnings per share rose 20.7% to €7.33 from €6.07. First-half IFRS consolidated net profit rose 20.0% to €402.6 million from €335.5 million.

Ipsen raised its full-year 2026 guidance for total sales growth to greater than 20.0% at CER, from prior guidance of greater than 13.0%, and raised its core operating margin guidance to greater than 37.0% of total sales, from prior guidance of greater than 35.0%.

The company said an adverse currency effect of around 1% on total sales is expected, based on average June 2026 exchange rates.

Guidance assumes accelerated sales growth of the portfolio excluding Somatuline and continued Somatuline growth despite potential entry of generic lanreotide, the company said.

The company reported positive Phase III topline results for Dysport in episodic and chronic migraine and for Iqirvo in primary biliary cholangitis. A Phase III trial of Bylvay in biliary atresia did not meet its primary endpoint of improved native liver survival.

Ipsen also announced the acquisition of Memo Therapeutics AG and an agreement to acquire Kartos Therapeutics, with the latter deal expected to close by the end of the third quarter of 2026.

Closing net cash was €1,004.9 million as of June 30, 2026, up from €487.6 million a year earlier. Free cash flow rose 34.9% to €651.7 million from €483.2 million.

"Our excellent first-half performance demonstrates the strength of Ipsen’s strategy, with all three therapeutic areas contributing to growth and the portfolio beyond Somatuline continuing to accelerate," said David Loew, Chief Executive Officer, Ipsen.

Barclays said the raised guidance implies 2026 revenue of €4,366 million, 4% above company consensus of €4,195 million, and core operating income of €1,615 million, 8% above company consensus of €1,498 million.

The broker set its €170 price target using a target price-to-earnings multiple of about 12.5 times projected 2027 earnings, a roughly 10% discount to the midcap/specialty sector to reflect what it called the stock’s "heightened LOE risk and weaker mid-term EPS growth outlook vs. peers."

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