Takeda Pharmaceutical Company Limited Q3 FY2025 earnings call

• Fiscal year '25 is pivotal with preparations for significant new product launches like oveporexton, rusfertide, and zasocitinib. - Financial results: 9-month revenue over JPY 3.4 trillion, down 3.3% YTD; core operating profit down 3.4% YTD but improving. - Pipeline updates: oveporexton and rusfertide NDA filed with FDA; zasocitinib Phase III psoriasis data positive, with launch expected in H1 2027. - Organizational changes: Julie Kim taking lead, structural changes effective April 1 to position for growth and launches.

GI: ENTYVIO grew 7.4% at constant exchange rate (CER) in Q3, with ENTYVIO Pen now on formulary with 80% commercial coverage. Rare diseases: TAKHZYRO saw 2.4% growth at CER, impacted by new competitors in the US. PDT: Q3 revenue growth improved, but albumin growth was 1.3% due to softening demand in China. IG growth was 4.3% YTD. Oncology: FRUZAQLA continues to expand. Vaccines: QDENGA growth accelerated to 22.1% driven by Brazil. Revenue contribution details: Growth and launch products represent over 50% of total revenue and grew 6.7% at CER.

• Revised revenue guidance to low single-digit decline at CER due to stronger-than-anticipated VYVANSE generic erosion. - Maintained full year guidance for core operating profit and core EPS. - Upgraded adjusted free cash flow forecast.

• Impact of VYVANSE generic erosion on revenue. - Competition affecting TAKHZYRO growth in the US. - Softening demand in China affecting albumin revenue in PDT. - Uncertainty in IRA price negotiations for ENTYVIO potentially affecting peak sales.

Q: Thoughts on next fiscal year, dividend?

A: Guidance to be provided in May, balancing growth and launch costs, with efforts to save costs ongoing but launch costs for new products posing load burden.

Q: Zasocitinib UC/CD Phase II timing?

A: Data from UC and Crohn's disease Phase IIb studies expected this year, dose-ranging studies ongoing, with higher exposures likely needed for efficacy in IBD.

Q: IRA impact on ENTYVIO?

A: Anticipated, with preparation underway; price cut details to be known later, impact on peak sales yet to be determined.

Q: TAKHZYRO trends?

A: Market maturing, impact from new competitors and Medicare Part D redesign in US, but TAKHZYRO remains gold standard with strong real-world efficacy data.

Q: Zasocitinib regulatory timeline?

A: Submission likely this summer, with FDA review timeline to be determined post-submission.