Biogen Inc. Q2 FY2025 earnings call

Key Points from Chris Viehbacher: - Strong Q2 performance with growth from new product launches offsetting MS decline. - Highlighted VUMERITY's growth, LEQEMBI's enablers like blood-based biomarkers and subcutaneous formulation PDUFA date, SKYCLARYS' rollout in 29 markets, and ZURZUVAE's strong quarter. - Mentioned pipeline progress including initiated Phase III studies for felzartamab, salanersen's Phase III start, and research agreement with City Therapeutics. ### From Priya Singhal: - Pipeline progress with initiated Phase III studies for felzartamab and salanersen, positive data on salanersen in SMA and dapirolizumab in lupus. - Discussed lupus pipeline with data on dapirolizumab's impact on fatigue and other domains. ### From Alisha Alaimo: - Commercial execution of launch products, including LEQEMBI's 20% QoQ U.S. revenue growth, SKYCLARYS' 5% global revenue growth, and ZURZUVAE's 68% QoQ U.S. revenue growth. - Talked about market dynamics for LEQEMBI, including market infrastructure maturing and direct-to-consumer campaigns.

The MS franchise was resilient this quarter. VUMERITY showed growth, with Alisha and her team in the U.S. emphasizing it over the last 2 years. LEQEMBI had growth enablers like blood-based biomarkers and a PDUFA date for subcutaneous formulation. SKYCLARYS is available in 29 markets with strong take-up in early access programs. ZURZUVAE had a very strong quarter, outperforming internal expectations. In terms of revenue contribution, the 4 launch products (LEQEMBI, SKYCLARYS, ZURZUVAE, etc.) generated $252 million in Q2, up 26% QoQ and 91% YoY. LEQEMBI U.S. revenue grew 20% QoQ. SKYCLARYS had global demand growth, with U.S. growth offsetting Medicare discount dynamics. ZURZUVAE had Q2 revenue of $46 million, up 213% YoY and 68% QoQ.

Guidance Details: - Raised full-year 2025 non-GAAP diluted EPS to the range of $15.50 to $16 from $14.50 to $15.50. - Total revenue for 2025 is expected to be roughly flat compared to full year 2024, reflecting strong first half revenue performance. - Anticipates increased competitive pressures on the ex-U.S. MS business, particularly for TECFIDERA in Europe. - Expects minimal contract manufacturing revenue in Q4 2025 due to planned plant maintenance activities. - Remains on track to deliver $1 billion of gross savings and $800 million of net savings under the Fit for Growth initiative.

Risks: - Competitive pressures on the ex-U.S. MS business, especially for TECFIDERA in Europe. - Potential impact of arbitration with Eisai regarding commercialization allocations in Europe. - Uncertainty around CMS reimbursement for blood-based biomarkers and whether they will be sufficient for therapy reimbursement. - IQVIA's updated methodology for reporting shipped prescriptions for ZURZUVAE may affect capture rates.

Q: Phil Nadeau asked about the AHEAD 3-45 trial and differences between AHEAD 3-45 and TRAILBLAZER-ALZ 3.

A: Priya Singhal discussed the scientific questions, recruitment/inclusion differences, and endpoints of the trials, noting a readout expected in 2028.

Q: Eric Schmidt inquired about LEQEMBI's market share and competitive dynamics.

A: Alisha Alaimo stated LEQEMBI still holds the majority market share (almost 70%), had strong new writer growth, and benefits from maintenance and subcu options. Priya Singhal added on indirect treatment comparison data at AAIC.

Q: Michael Yee asked about SMA market dynamics and myostatin.

A: Alisha Alaimo said myostatin is additive to SMN correctors and not a main competitor.

Q: David Amsellem questioned the lupus pipeline.

A: Priya Singhal discussed dapirolizumab, litifilimab, and timeline for data from the second Phase III of dapirolizumab (expected in '27-'28) and litifilimab SLE data (early next year).

Q: Umer Raffat asked about the Eisai relationship.

A: Christopher Viehbacher said the partnership with Eisai is strong, and arbitration regarding Europe launch is part of the contract process.

Q: Brian Abrahams asked about blood-based biomarkers.

A: Alisha Alaimo talked about educating physicians, reimbursement clarity, and test adoption, noting tests are evolving and guidelines were issued.

Q: Jay Olson asked about subcu LEQEMBI.

A: Priya Singhal and Alisha Alaimo discussed physician feedback, patient choice, auto-injector use, and human factors study results showing patient ability to self-administer.

Q: Salveen Richter asked about business development.

A: Christopher Viehbacher talked about early-stage assets being a lever, focusing on I&I, and strategic fit for pipeline drivers.

Q: Julian Pino asked about subcu lecanemab logistics.

A: Priya Singhal and Alisha Alaimo discussed administration optionality (patient, caregiver, etc.) and human factors study showing auto-injector simplicity.

Q: Jake asked about felzartamab in AMR.

A: Christopher Viehbacher and Priya Singhal talked about the addressable market for felzartamab in AMR (~$1.5B) and its potential in late MVI (~5,000-6,000 patients).