Biogen Inc (NASDAQ:BIIB) Crashes and the Future Doesn’t Look BrightAuthor: Victor AlagbeLast Updated: March 30, 2020 Biogen Inc is having a rough session today as the stock plummets in early morning trading. As at 10:02AM EDT, the share price of Biogen has dropped by 16.73% ($64.43) to a $320.61 trading price. The huge haircut recorded in the trading price of Biogen today can be traced to the quality of the firm’s second quarter (Q2 2015) earnings result that was released this morning.Dismal Q2 FinancialsBiogen is a biopharma firm with a market capitalization of $75.41B. The firm discovers, develops, manufactures and delivers therapies for neurological, autoimmune and hematologic disorders. The second quarter result that was released today is very important for the firm because its financials disappointed in the first quarter.Investors were still hanging with the stock despite the dismal first quarter results with the hopes that Biogen will redeem itself in the second quarter. After all, Biogen beat estimates in 3 out of the previous 4 quarters with an average positive surprise of 12.28%. The plummet recorded in the stock shows that Biogen was not able to redeem itself in the second quarter. Highlights of Biogen’s second quarter results are presented below:Earnings: Biogen reported Q2 earnings of $4.22 per share above the consensus estimate of $4.07 per share to mark a 3.68% earnings beat.Revenue: The firm reported revenue of $2.59B below the consensus estimate of $2.71B by 4.63%. The revenue marks a 7% year-over-year increase. Revenue was also affected by a $79M currency headwind.Guidance: Biogen has reduced its guidance going forward. The firm now expects EPS between $15.50 and $15.95 on revenue growth of 6% to 8%. The new guidance is drastically lower than the previous guidance with EPS of $16.60 to $17.00 per share on revenue growth of 14% to 16%.Drug Sale Below ExpectationsThe main reason Biogen was not able to meet expectations is that its drug sales failed to meet expectations. Sales of its flagship oral drug for Multiple Sclerosis (MS) Tecfidera came in at $833M, a good $100M short of the sales expectation of $933M.One of the reasons Tecfidera did not record great sales is safety concerns arising after one of the patients taking the drug died from a rare brain infection.Its injectable MS drug, Tysabri brought in $463M below the estimate of $505M. Its interferon-based MS drug, Avonex and Plegridy brought in $690M below the expected sales of $767M.Takings from the Q2 ResultsThe reduction in guidance is the main reason the shares of Biogen are taking a drubbing today. An increase in guidance usually suggests that management is optimistic about the future and investors will be content to take the dismal Q2 results as the function of a bad quarter. However, reducing guidance after posting a bad quarter suggests that the firm expects the situation of things to worsen going forward.