A big Wall Street flip just changed the Regeneron narrative

Bank of America Global Research upped its rating on Regeneron Pharmaceuticals and its price target to $860 because it has a better view on Eylea HD, Dupixent is growing steadily, and there are several catalysts for 2026.

Bank of America Global Research raised its rating on Regeneron Pharmaceuticals. The firm said that its earlier worries regarding the company's main eye medicine had mostly been resolved and that new products and pipeline catalysts might change the stock's outlook over the next year.

Bank of America revised its rating on Regeneron from "underperform" to "buy" and boosted its price target from $627 to $860. At the time of the article, Regeneron shares were worth $796.55, which means the revised target is nearly 8% higher.

The call is about Eylea, Regeneron's long-term treatment for retinal illness, and more specifically, Eylea HD, the company's higher-dose version. Bank of America said it is now more hopeful that Eylea HD can perform better than what most people think it would, thanks to recent label modifications and what the company called helpful input from industry experts.

In its note, the company succinctly expressed its shift in perspective:

Eylea HD becomes the focus as older concerns fade

Bank of America said that its previous thesis about Eylea's standard-dose medicine not doing well has "played out," and that market expectations and consensus forecasts have already gone down.

The company's upgrade suggests that investors should now focus on whether Eylea HD can gain traction and whether adjustments to the label impact how doctors prescribe it, particularly at large practices that comprise a significant portion of the anti-VEGF market.

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What Bank of America says is changing about the Eylea story:

• Standard-dose reset: The company indicated that expectations for Eylea SD have already gone down, which has lowered the earlier overhang.
• HD momentum: People think that the new labels make Eylea HD more appealing in therapeutic settings.
• Behavior in practice: Large retina practices are a major swing factor since they do a lot of business.
• Biosimilar dynamic: Some channel feedback revealed that SD biosimilars may not put as much pressure on HD as was thought.

The report talked about recent changes to the label for Eylea HD, such as the fact that it can now be taken every four weeks and that it has been approved for retinal vein occlusion. It also talked about the planned road to approval for a prefilled syringe, with an FDA resubmission likely in January and possible approval in the middle of 2026.

Bank of America noted that channel checks showed that some bigger practices may now choose Eylea HD to Roche's Vabysmo. The company also noted that comments disputed a major bear fear that standard-dose biosimilars will surely hurt the uptake of Eylea HD. Some people who answered thought that the opposite could happen: more standard-dose biosimilars could make practices lean toward premium options like Eylea HD.

Bank of America predicted that the U.S. Eylea franchise will generate $4.35 billion in revenue in 2026, which is more than the $3.86 billion that the research said was the average estimate. The company also noted that its prediction doesn't include any return of investment from charitable foundations after 2026.

Key numbers highlighted by Bank of America:

• Price target: $860 (up from $627)
• Share price cited: $776.54 (as of Jan. 7)
• Implied upside: about 10.7% to 11%
• Eylea U.S. franchise (2026E): $4.35B (vs. $3.86B consensus cited)

Dupixent remains the anchor, with upside optionality

Dupixent is still the major driver, with a possibility for growth.

Through its partnership with Sanofi, Regeneron benefits from Dupixent's economics. Bank of America mostly agreed with the broader market in its base-case projection. The company predicted that Dupixent would make $20.7 billion in 2026, which was the same number as the average.

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Dupixent sales drivers:

• Established growth engines: Atopic dermatitis and asthma are still on the rise.
• Newer indications: New uses that have just come out are expected to add to growth.
• The competitive landscape: New drugs may take market share, but also grow the market as a whole.

The letter noted that Dupixent is still growing in established indications, including asthma and atopic dermatitis, and that novel indications are expected to help it develop steadily. Bank of America also discussed the policy background on medicine prices, stating that Regeneron had not yet reached a deal with the White House on what is known as "most favored nation" pricing. Analysts noted that a favorable decision might lower what it called an overhang on the stock. It also pointed to Sanofi's recent MFN agreement, which it said did not mention Dupixent.

Policy watchlist investors should track:

• MFN discussions: Potential resolution could remove an overhang.
• Exemption question: The note suggested an outcome that could limit MFN-related exposure.
• Timing: The firm framed this as a near-term issue, with January a key window.

2026 catalysts include oncology data and a potential filing

My review of the analyst report revealed several factors that could impact sentiment and valuation in 2026, in addition to the commercial portfolio.

Catalysts Bank of America highlighted:

• January: Industry updates tied to a competitor conference
• January: MFN-related developments with the White House
• January: Eylea HD prefilled syringe FDA resubmission
• Mid-2026 (possible): Eylea HD prefilled syringe approval
• First half of 2026: Phase 3 fianlimab (LAG-3) readout in first-line metastatic melanoma
• First quarter of 2026: Cemdisiran filing in generalized myasthenia gravis (expected)

A phase 3 readout for fianlimab, a LAG-3 program that Regeneron is exploring for use in combination with Libtayo (cemiplimab) in first-line metastatic melanoma, is one of the most closely watched developments.

The analysts believe the business may provide phase 3 data in the first half of 2026. They also said that doctors had shown interest in how the regimen compares to current options. The letter added that key opinion leaders were most interested in objective response rates and progression-free survival as outcomes that might have a big effect on business. It also noted that investors will look to the head-to-head phase 3 outcome.

Bank of America also said Regeneron has finished enrolling in a phase 3 adjuvant melanoma setting. The firm has talked about intentions for an interim analysis and a "substantial" readout in 2026, although it is not yet fully mature.

The memo mentioned cemdisiran, a C5 siRNA treatment, in immunology and other fields. It is planned to be filed for generalized myasthenia gravis in the first quarter of 2026, after phase 3 data is reported in August 2025. Bank of America warned that the gMG market is congested because there are currently several licensed complement inhibitors.

Valuation target changed with the rating

Bank of America also changed how it valued things, going from an earnings-multiple framework to a discounted cash flow sum-of-the-parts examination.

Analysts said that the biggest drivers of its value came from income from working with Sanofi, followed by the Eylea business and Libtayo.

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It also gave some value to the pipeline and net cash. The company said it utilized a 7% weighted average cost of capital and didn't forecast a terminal value.

How the firm framed its new valuation approach:

• Method: DCF-based sum-of-the-parts
• Major components: Sanofi collaboration revenues, Eylea franchise, Libtayo, pipeline, net cash
• Assumption: 7% weighted average cost of capital
• Structure choice: No terminal value in the model

The change reflects the company's future vision for the stock, focusing on cash flow streams with potential risk based on regulatory changes rather than near-term profitability.

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