NovoCure Limited Q3 FY2025 earnings call

• Mission: Novocure's mission is to extend survival in aggressive cancers, evolving from a single indication company to a platform therapy company. - GBM: Active patient count grew 5%-12% YOY for 9 quarters, ending Q3 with 4,277 patients; France, Japan, and Germany drove growth; Spain received a positive national coverage decision. - Non-small cell lung cancer: Launch behind expectations due to patient health, competition, and device experience; Japan launch approved, planning strong adoption; working on LUNAR-2 and product development. - Regulatory updates: PANOVA-3 data submitted to FDA for pancreatic cancer, expected approval mid-2026; METIS brain metastases data presented, PMA submission timeline unchanged. - Product development: New patient app launched in U.S., portal for GBM prescribers, updated MAXPOINT software submitted to FDA, HFE arrays rolled out, next-gen torso array in development; clinical readouts expected in H1 2026.

Novocure's net revenues for the third quarter were $167 million, representing an 8% increase from the third quarter of 2024. The GBM business remained solid with active patients growing 5% to 12% year-over-year for 9 consecutive quarters, ending the quarter with 4,277 GBM patients on therapy. France, Japan, and Germany were the largest contributors to active patient growth. In non-small cell lung cancer, the launch was behind expectations with 100 lung cancer patients on therapy in Q3, 94 in the U.S. and 6 in Germany. Gross margin for the quarter was 73%, impacted by the global rollout of HFE arrays, the ongoing lung cancer launch, and a $2.9 million inventory obsolescence provision for Optune Lua arrays.

• Prepare to treat 4 cancer indications by year-end 2026. - Aim to reach profitability. - Expect to break even sustainably on an adjusted EBITDA basis in 2027 with revenue contribution from new indications. - Anticipate FDA approval mid-2026 for pancreatic cancer and finalize brain metastases PMA filing by year-end 2025.

• Launch progress in non-small cell lung cancer may be slower than expected. - Potential regulatory approval delays for pancreatic cancer and brain metastases. - Intense market competition in lung cancer and other indications affecting adoption. - Challenges in securing reimbursement and NCCN guideline inclusion impacting growth.

Q: Jason Bednar asked about lung cancer launch comparisons in Germany and Japan vs the U.S., reimbursement, and NCCN guidelines.

A: Ashley Cordova stated Germany is early days with no specific differences from U.S. dynamics; Japan has higher lung cancer prevalence, comfortable device-based therapy use, and local ICI use; Frank Leonard discussed learnings in U.S. launch, pivoting to high-interest doctors; Ashley mentioned NCCN guidelines submitted, commercial reimbursement going well, and Spain's ramp-up similar to Japan's Optune Gio launch.

Q: Kevin Joaquin inquired about lung cancer initial expectations, LUNAR-4 termination, and spend.

A: Ashley said internal launch expectations not shared; LUNAR-4 terminated for cost-efficient real-world evidence; Christoph Brackmann noted savings in the mid to high single digits.

Q: Tanmay Patwardhan asked about non-small cell lung cancer active patient sequential decline and gross margin trajectory.

A: Frank Leonard said to ignore prescription noise; Christoph Brackmann explained gross margin impacted by launches and reimbursement gap, expected to recover to higher levels.

Q: Evelyn asked about Optune Lua launch prescribers and profitability.

A: Ashley said 84 unique prescribers in Q3; Christoph stated the goal is to break even on adjusted EBITDA at $700-$750 million revenue in 2027.

Q: Emily Bodnar asked about lung launch expectations and learnings for pancreatic launch.

A: Ashley said adjusted internal expectations; Frank said learnings include educating practice staff and continued evidence generation for pancreatic launch.