HALOZYME THERAPEUTICS, INC. Q3 FY2024 earnings call

• Delivered strong third quarter financial results with total revenues up 34% to $290 million and royalty revenue up 36% to $155 million. - Raised full-year guidance for total revenue (17%-23% growth), royalty revenue (23%-26% growth), adjusted EBITDA (40%-47% growth), and non-GAAP earnings per share. - Continued expansion of ENHANZE technology with partners: Roche gained regulatory approvals for TECENTRIQ and OCREVUS subcutaneous, J&J's DARZALEX showed strong growth, and argenx's VYVGART had momentum. - Two current partners nominated new targets for ENHANZE under expanded licensing agreements, adding new revenue potential. - Multiple partners expanded geographic approvals and advanced clinical development programs.

Halozyme reported a 34% increase in total revenues to reach an all-time high of $290 million in the third quarter. Royalty revenue saw a 36% jump to $155 million, driven by the continued expansion and adoption of the ENHANZE drug delivery technology. DARZALEX Subcutaneous worldwide sales increased almost 23%, with subcutaneous DARZALEX being a key driver. Phesgo sales for the first nine months of 2024 grew 58% to CHF1.2 billion. TECENTRIQ HYBREZA and OCREVUS ZUNOVO with ENHANZE showed strong performance, and VYVGART Hytrulo continued to experience strong momentum. In terms of revenue contribution, royalty revenue was a significant part, accounting for a large portion of the total revenue growth.

• Total revenue guidance raised to $970 million to $1.20 billion. - Royalty revenue guidance raised to $550 million to $565 million. - Adjusted EBITDA guidance raised to $595 million to $625 million. - Non-GAAP diluted EPS guidance raised to $4 to $4.20.

Refer to SEC filings for a full list of risks and uncertainties related to the business.

Q: On OCREVUS and TECENTRIQ recent launches, current view on sub-Q conversion and long-term outlook?

A: Nicole LaBrosse stated for OCREVUS, it's a market growth strategy not immediate conversion, with the availability of subcutaneous expanding the market. For TECENTRIQ, there will be a conversion focus as it offers a simpler regimen.

Q: Status update on new collaboration deals before end of year?

A: Helen Torley said they are focused on gaining new deals and are within the guidance range of $130 million to $150 million for collaboration revenue.

Q: MDASE platform opportunity and differentiation from ENHANZE?

A: Helen Torley explained MDASE is modified Hyaluronidase IP, distinct from ENHANZE's truncated human hyaluronidase. ENHANZE is the gold standard, while MDASE is for companies unable or not wanting to work with ENHANZE.

Q: Progress on VYVGART Hytrulo and pre-filled syringe?

A: Helen Torley said argenx expects a PDUFA action date in April for VYVGART Hytrulo with pre-filled syringe.

Q: Auto-injector side discussion?

A: Helen Torley said continuing discussions with high-volume and small-volume auto-injector, making progress but no updates today.

Q: MDASE platform opportunity context?

A: Helen Torley said ENHANZE is the primary focus, but MDASE is for companies using modified hyaluronidase not working with ENHANZE.

Q: Guidance update philosophy and MDASE differentiation from ENHANZE?

A: Nicole LaBrosse talked about guidance focus on current results and future projections, Helen Torley explained ENHANZE and MDASE are different patent portfolios.

Q: Collaboration revenue guidance range and MDASE partner concerns?

A: Helen Torley said guidance range is $130 million to $150 million, and no pushback from partners on MDASE.

Q: Product sales flatness in 2024 and future growth?

A: Nicole LaBrosse said product sales are lumpy due to API investments, but proprietary sales are trending as expected with future growth.