Astellas Pharma Reports Earnings Rebound, PADCEV Priority Review, and Myrbetriq Settlements

Astellas Pharma reported a sharp earnings rebound for the fiscal year ended March 31, 2026, with sales rising to ¥2.14 trillion and net income to ¥291.54 billion, while securing a U.S. FDA Priority Review for a broader PADCEV plus Keytruda indication in muscle-invasive bladder cancer and closing U.S. patent disputes over Myrbetriq. The stock fell 10.6% after the earnings announcement.

The supplemental Biologics License Application for perioperative PADCEV plus Keytruda stands out among recent developments. If approved, expanding use from cisplatin-ineligible to all muscle-invasive bladder cancer patients could be important for reinforcing PADCEV's role in Astellas' portfolio. The key near-term catalyst is the August 2026 FDA decision on PADCEV in muscle-invasive bladder cancer.

For Q1 fiscal 2027, revenue was ¥640,914m versus ¥505,794m in Q1 fiscal 2026, up about 26.7%. Net income excluding extra items rose to ¥141,828m from ¥68,422m, up about 107.2%. Basic EPS was ¥79.15 versus ¥38.22, up about 107.1%. Trailing 12-month net margin reached 16.0%, up from 4.2% a year earlier. Astellas also raised its fiscal 2026 guidance earlier this month, and its shares returned 30.48% over three months and 73.62% over one year.

Astellas closed its U.S. patent disputes over overactive bladder drug Myrbetriq, securing settlement and upfront licensing payments from Lupin and Zydus, as well as ongoing per-unit fees. The company's cost optimization initiatives (SMT) are running ahead of schedule, with early realized reductions in SG&A and R&D costs directly improving net margins even as growth investments are maintained.

The bull case leans on margin power and pipeline proof, with CSP2026 targeting pipeline-led growth, more phase 3 studies and higher dividends. Bears focus on XTANDI and mirabegron erosion once generics scale, along with execution risk in a broad pipeline, recent clinical discontinuations and the June resignation of an outside director tied to R&D oversight.

Astellas is trading at ¥2,470. The most followed narrative points to a fair value of ¥1,938 using a 4.8% discount rate, implying the stock is about 27.4% overvalued. Its P/E of 13.7x looks low next to peers at 30.8x, the Japanese pharma average at 15.3x, and an estimated fair ratio of 21.5x. Astellas' narrative projects ¥1,821.9 billion revenue and ¥244.8 billion earnings by 2029, implying a 5.2% yearly revenue decline and an earnings decrease of ¥46.7 billion from ¥291.5 billion today. Some analysts assume revenue could fall to about ¥1,648.6 billion and earnings to roughly ¥118.0 billion by 2028.