Climbing The Cliff In Reverse

A few months ago, I found myself sipping flat champagne on a Gulfstream out of Aspen, locked in one of those altitude-fueled biotech postmortems.

On my left: a hedge fund manager freshly out of his biotech positions after a bruising year. On my right: a dermatologist who moonlights as a GLP‑1 evangelist.

Regeneron (REGN) came up. The fundie barely blinked. “Eylea’s done. Too exposed. No edge left.” The dermatologist tilted his head, then said, “Maybe. But we’re nowhere near peak Dupixent.” That was it. He wasn’t open to debate.

The conversation moved on. I didn’t.

Because when two smart people see the same company and draw opposite conclusions, I see an opportunity. And in this business, asymmetry like that is where the real money lives.

Regeneron’s Eylea franchise has clearly seen better days. With biosimilars entering the ring in 2024, including Amgen’s (AMGN) Pavblu, the classic version of Eylea took a 40% year-over-year nosedive.

But here’s what’s getting overlooked: Eylea HD, the higher-dose follow-up, is holding its own. It now accounts for nearly 40% of U.S. franchise sales, and its growth has been quietly offsetting the erosion of its predecessor. The dramatic crash many feared is looking more like a soft landing, at least until late 2026, when Teva and Alvotech finally get FDA clearance for their delayed entrant.

In the meantime, Regeneron has done what great companies do – buy time, buy margin, and keep the pipeline moving.

And that pipeline starts with Dupixent, which at this point deserves its own corporate anthem. Already approved for eight indications and now expanding into chronic spontaneous urticaria and bullous pemphigoid, it’s riding a wave of adoption across dermatology, asthma, and most recently, COPD.

Sales grew 26% last year, and there’s little reason to expect a slowdown. What’s more, there’s a financial kicker Wall Street hasn’t fully accounted for: the $900 million development balance Regeneron owes Sanofi will be paid off by Q3 2026.

That’s roughly a billion in collaboration revenue per year that suddenly stops flowing back to Paris and starts staying in-house. It’s like finding an extra barrel of oil under your refinery – and not a drop of it is priced in.

Libtayo is another underappreciated gem. It now holds a monopoly in adjuvant CSCC after Keytruda failed to deliver.

The efficacy data weren’t subtle: a 68% reduction in risk of death, and the market is vast, with over 700,000 U.S. cases per year.

With label expansions in NSCLC and BCC also ramping, Libtayo could be a $2 billion drug by the end of next year, and it’s doing so with pricing power and minimal direct competition.

Then there’s Fianlimab, Regeneron’s quiet challenger to the checkpoint inhibitor throne. Paired with Libtayo in metastatic melanoma, the upcoming Phase 3 data could be a serious threat to Opdualag’s position – and by extension, to Merck (MRK) and Bristol-Myers’ (BMY) dominance.

If the data holds (and early signals are encouraging), Regeneron could go from having a strong oncology product to owning a franchise.

In multiple myeloma, Lynozyfic is entering the fray with once-monthly dosing and a 70% objective response rate. The initial commercial impact may be modest, but it sets the stage for Regeneron to chip away at a $30 billion market.

Even a small footprint here diversifies the revenue stream and signals to the market that this company isn’t just defending; it’s attacking.

And then there’s the wildcard: Trevogrumab, Regeneron’s entry into the GLP-1 wars. This isn’t just another weight loss play.

The COURAGE trial is testing a muscle-sparing combo with semaglutide aimed at delivering “quality” weight loss, which means it’s not just shrinking waistlines but preserving lean mass.

If it works, Regeneron won’t just be another challenger for Novo (NVO) or Lilly (LLY) on their turf. A positive readout in early 2026 wouldn’t just create a new asset; it would shift the narrative and possibly attract strategic interest.

At current levels, Regeneron trades at about 17x forward earnings, and it’s a multiple that assumes tepid growth and lingering pain from Eylea. But what the numbers are beginning to show, and what 2026 could make glaringly obvious, is that the company’s margins are expanding, its product mix is improving, and its story is evolving fast.

If revenue hits $16.3 billion next year, which is actually a realistic stretch, and EPS clears $60, a 20x multiple puts the stock north of $1,200. That’s a 50% gain from here, all while the market continues to treat this like a mid-tier pharma plodder.

Regeneron isn’t trying to be flashy. It’s doing something much better: turning into a stealth growth machine right when everyone stopped paying attention.

The fundie on that plane was sitting on the left side. The dermatologist was on the right. As it turns out, so was the trade.