Lantheus Holdings, Inc. Q1 FY2025 earnings call

Management Statement and Operational Highlights

• Acquisitions: Announced acquisitions of Evergreen Theragnostics and Life Molecular Imaging (LMI) to strengthen radiodiagnostic and therapeutic capabilities, expand commercial portfolio and pipeline. Closed Evergreen in early April, expect to close LMI in coming weeks.
• Divestment: Plan to divest SPECT business to SHINE Technologies, streamlines organization and focuses on core capabilities.
• Operational Updates: Focused on integrating Evergreen and LMI, advancing pipeline including MK-6240 (planned NDA submission in Q3 2025, potential market launch in 2026) and PNT2003 (planned launch in 2026 pending FDA approval and patent litigation resolution).

Segment Performance

• Radiopharmaceutical Oncology (PYLARIFY): Contributed $257.7 million in sales, flat year-over-year.
• Precision Diagnostics: Revenue of $104.4 million, flat year-over-year. DEFINITY achieved approximately $79 million in sales, 3.5% higher; TechneLite had $19.7 million, down 9.2% due to a brief MOLE supply issue in March (now resolved).
• Strategic Partnerships and Other: $10.7 million, up 65.1% due to continued contribution from use of investigational asset MK-6240 in third-party clinical trials and the first sale milestone from Mercado.

Guidance

• Revenue: Expected to be $1.55 billion to $1.585 billion, with Evergreen adding approximately $10 million for the balance of the year.
• EPS: Adjusted EPS range $6.60 to $6.70, down from prior guide due to dilution from Evergreen and LMI, but LMI expected to be accretive to revenue and earnings immediately.
• R&D: Expected to be ~7.5% of revenue, up ~100 basis points for the full year.

Risks

• Competitive Pressures: Short-term disruption in smaller non-contracted sites due to Medicare fee-for-service transition to mean unit cost.
• Reimbursement Uncertainties: Uncertainty around ASP emergence and impact on PYLARIFY revenue.
• Patent Litigation: Pending resolution for PNT2003 patent litigation.
• Market Dynamics: Uncertainties in Alzheimer's diagnostic market encroachment by serum-based biomarkers.

Question and Answer

Q: Anthony Petrone from Mizuho Financial Group asked about PYLARIFY competitive dynamics.

A: Paul Blanchfield responded that strategic partnerships with longstanding hospitals and freestanding imaging centers stabilized the business, but there was short-term disruption among smaller non-contracted sites due to MUC-related reimbursement.

Q: Roanna Ruiz from Leerink Partners asked about SPECT divestiture and resource allocation.

A: Bob Marshall and Paul Blanchfield responded that divestiture frees resources for core growth areas like PET radiodiagnostics and radiotherapeutics, and Paul mentioned organizational focus on key growth areas.

Q: Richard Newitter from Truist Securities asked about 2026 guidance and acquisition dilution.

A: Bob Marshall responded that low-single-digit dilution from Evergreen and LMI is still expected, with LMI expected to be accretive immediately.

Q: Unidentified Analyst from Goldman Sachs asked about PYLARIFY ASP trends and Alzheimer's PET market growth.

A: Paul Blanchfield and Amanda Morgan responded that they are in discussions with CMS regarding ASP, and they are optimistic about the long-term growth of the Alzheimer's radiodiagnostic market driven by approved therapeutics and clinical development of candidates targeting beta-amyloid or tau.