(Bloomberg) — Biogen Inc. raised its annual profit forecast after reporting better-than-expected third-quarter sales and profits, driven by ongoing cost-cutting measures and strong performance of its new treatment for Alzheimer’s disease.

The biotech company now expects 2024 adjusted earnings per share in the range of $16.10 to $16.60, an increase of 35 cents from the midpoint of its previous projection.

Third-quarter adjusted earnings were $4.08 per share, the Cambridge, Mass.-based company said in a statement Wednesday. Although this represents a 6% decline from the previous year, it exceeds analyst estimates.

The results could help Biogen begin to restore investor confidence. The stock is down 29% this year as of Tuesday’s close, largely due to a sluggish start to Leqembi – on the market to treat Alzheimer’s disease since January 2023 – and recent rejection by European regulators for security reasons.

Biogen shares were up 2.2% in early trading as of 7:02 a.m. New York time.

Since taking office in late 2022, CEO Chris Viehbacher has worked to strengthen Leqembi’s sales, cut expenses and diversify Biogen’s portfolio to ease its reliance on pharmaceutical companies. high-risk neuroscience. In May, Biogen agreed to buy Human Immunology Biosciences Inc. for up to $1.8 billion to expand its portfolio of treatments for immune diseases. Viehbacher also led Biogen’s largest-ever acquisition last year, buying Reata Pharmaceuticals Inc. for $7.3 billion to get its treatment approved for Friedreich’s ataxia, a rare neurodegenerative disease.

Last year, Biogen announced plans to cut 1,000 jobs, or more than 11% of its workforce, and cut operating expenses by an additional $700 million by 2025. On Wednesday, the company Expected that these cost-cutting efforts would help drive operating profit growth into the high teens percentage range for the year.

Quarterly sales of Leqembi, which Biogen developed in partnership with Japan’s Eisai Co., reached $67 million, up from about $40 million in the previous quarter, beating analysts’ expectations of $51 million.

Biogen is banking on Leqembi to offset the decline of its multiple sclerosis drugs. Leqembi is the first drug capable of slowing the progression of Alzheimer’s disease, the mind-bending illness that affects some 6 million Americans, but sales in the United States have been slowed by logistical hurdles.

Regulators in Europe and Australia have rejected the drug, fearing its risks outweigh its benefits, which would be a setback as Biogen and Eisai face new competition. In July, U.S. regulators approved a competing Alzheimer’s therapy from Eli Lilly & Co.

Biogen’s total third-quarter sales reached $2.47 billion, slightly above analysts’ average estimate of $2.43 billion. The company reiterated its expectations for a “low single-digit percentage” revenue decline for the year, driven primarily by lower sales of its multiple sclerosis drugs.

Sales of Skyclarys, which treats Friedreich’s ataxia, were $102 million, a slight increase from $100 million in the second quarter. Analysts had expected revenue of $107 million.

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