Regeneron Pharmaceuticals, Inc. Q2 FY2025 earnings call

• Commercial Performance: EYLEA HD had strong unit demand with U.S. net sales at $393 million, a new high. Dupixent and Libtayo saw significant growth. EYLEA U.S. net sales were impacted by competition and patient conversion to EYLEA HD.
• Pipeline Advances: Progress in myeloma (Lynozyfic data), lymphoma (odronextamab), thrombosis (Factor XI program), obesity (GLP-1/GIP receptor agonist), and genetic medicines. Notable data in early-stage myeloma and lymphoma.
• Capital Allocation: Heavy investment in internal R&D, over $7 billion in U.S. investments for R&D and manufacturing, with plans for share repurchases and dividends.

Dupixent: Global net product sales were $4.3 billion in the second quarter of 2025, up 21% on a constant currency basis versus the second quarter of 2024. Libtayo: Global net product sales grew 25% on a constant currency basis compared to the second quarter of last year and are now annualizing at $1.5 billion. EYLEA: Second quarter 2025 U.S. net product sales were $754 million, down 39% compared to the second quarter of last year. EYLEA HD in the U.S. grew by 29% compared to the second quarter of last year, with U.S. net product sales reaching $393 million in the second quarter, contributing 1/3 of total combined U.S. net sales of retina products.

• Financial guidance updated with changes in SG&A, R&D, and COCM expenses, resulting in a combined net decrease of $125 million at midpoints, partially offset by slightly lower gross margin guidance. - Anticipate fully reimbursing Sanofi development balance by end of 2026, not 2025 as previously misstated.

• Catalent site inspection impacting EYLEA HD and odronextamab PDUFAs. - Competitive pressures, patient affordability issues, and pricing negatively impacting EYLEA U.S. net product sales.

Q: Good Q2 results, but I have a policy question. It's on MFN and the 17 letters that were sent out. Three of those letters had the CEO names crossed out, replaced with first names that were kind of penciled over. That was Lilly, Pfizer, and Regeneron, and it makes me wonder, is there a closer relationship between those CEOs and Trump. I know Lilly and Pfizer have been tomorrow logo a lot to influence policy. So my question is, Len, have you been down there frequently as well? I ask because the common assumption is that MFN might play out through a CMMI demo project. EYLEA is a big Part B drug. Could that get wrapped into it or not because there's a biosimilar. So perhaps you have some visibility. Any perspective on any of this would be appreciated.

A: Yes. Thanks. I've not been down there frequently. I think the President probably knows Regeneron and my first name, given that it was Regeneron's cocktail for COVID that may have saved his life. Beyond that, I don't have any great insights to the policies. I have been and the company has been outspoken that we agree with the President that the Europeans are not paying their fair share of innovation and some way that needs to change. It's complicated, and it does have to be done at a trade and policy level because it can't be done at an individual company level. It's very difficult. But we certainly agree that it's not right that Americans, American consumers should not be paying for all of the innovation. The solution is simply not to lower prices in the U.S. without some equilibrating in Europe because then there'll be no innovation. But the answer to your question, Tim, is don't have any unique insight because my first name was used.

Q: Congratulations [indiscernible] great to see this quarter. So there was a great quarter-over-quarter rebound in EYLEA HD. So curious to hear what you would attribute that to. And regarding the Catalent site inspection issue, can you provide additional color on the nature of the issue and if there's precedent for how long it might take to resolve it or how long the potential HD approvals will be pushed back by?

A: I'll let Marion get into more details about the -- what was driving the quarter for HD. In terms of Catalent, we really need to direct those calls to Novo. What we can say in a broad sense that these were not structural changes that are being requested by the FDA. It's not like they have to rebuild something of that. They're mainly process procedural those sorts of thing. As we said in our remarks, we do think that they'll provide a robust response. Novo's CEO wrote directly to the FDA and said they're going to elevate all this to the standards of Novo. I believe that we may not be the only PDUFA that's in snare because they do -- as I said, they do work for virtually all the biopharmaceutical companies. They fill -- Catalent filled in its fiscal year '24, something like 70 billion or 80 billion unit doses. So I think that this has a good chance of being done expeditiously. But more specifically than that, it's a little early. When we know a little more, we'll get that information out to you. I'll turn it over to Marion to comment on driving of sales for HD.