Telix Pharmaceuticals Limited Q2 FY2025 earnings call

Management Statement and Operational Highlights

• Financial Performance: Group revenues reached $390 million, a 63% year-on-year increase. R&D investment surged 47% to $82 million. The company finished the half-year with $207 million in cash on hand.
• Growth Strategy: Focus on growing the precision medicine/commercial stage imaging business, advancing the late-stage therapeutics pipeline (including alpha therapy candidates), and expanding global delivery infrastructure. Acquisitions led to 38 manufacturing/distribution sites and over 1,000 employees globally.
• Product Launches: Preparing to roll out Illuccix in Europe, and gearing up for the launch of Zircaix and Pixclara. Gozellix was launched, with HCPCS reimbursement effective October 2025.
• Therapeutics Pipeline: Has 10 early and late-stage assets in urology oncology, neurology oncology, and solid tumors. Progressed in Phase III trials for TLX591 (prostate cancer) and secured Human Research Ethics Committee approval for the first-in-human study of TLX592 (alpha therapy).
• RLS Integration: Synergies in commercial teams, with a 50% increase in Illuccix dose volume through the RLS network. Margin improvement potential as Illuccix volume grows through RLS.

Segment Performance

• Precision Medicine: Revenues increased 30% year-on-year, with EBITDA improving 24%. Gross margin remained stable at 64%. Precision Medicine generated $311 million in revenue, contributing approximately 80% of the total group revenue of $390 million.
• RLS (Radiopharmacies): Generated $79 million in third-party sales, processing 1/3 of the group's revenue. In the 5 months since acquisition, RLS EBITDA was close to breakeven. RLS has a gross margin of 7%, reflecting manufacturing and distribution costs related to radiopharmacies.

Guidance

• Revenue: Reaffirmed full-year revenue guidance of $770 million to $800 million from Illuccix and RLS.
• R&D Investment: Expected to increase by 20%-25% year-on-year.
• Long-Term Focus: Aim to grow revenues by advancing assets to commercialization, expanding indications and geographies, and reinvesting earnings into the portfolio to support therapeutic program delivery.

Risks

• SEC Subpoena: Relates to disclosure activity on prostate cancer therapeutic candidates. No impact on the commercial portfolio or pipeline momentum, but the company is actively responding to resolve the subpoena.

Question and Answer

• Q: Outlook for gross margins and PSMA pricing impact on Illuccix and Gozellix. A: Illuccix gross margin remained stable at 64%. RLS has a 7% gross margin; as Illuccix volume increases through RLS, RLS gross margin is expected to improve. PSMA pricing is managed through clinical value proposition, service, and strategic commercial actions.
• Q: Illuccix sales growth slowing, impact of pass-through status loss. A: Stabilization strategy for Q3, with Q4 benefiting from Gozellix launch. Continued growth through clinical accuracy, reliability, and a customer-facing team managing average selling price and volume mix.
• Q: Zircaix launch readiness. A: Commercial team is ready, leveraging Illuccix customer base, with excitement for launch given unmet medical need.
• Q: BiPASS study secondary endpoints and patient outcomes. A: Study launching, endpoints to be disclosed, with a monitoring period and follow-up to evaluate prostate imaging utility.
• Q: ProstACT study parameters and Part 2 plan. A: Part 1 recruited 30 patients, monitoring safety/dosimetry. Part 2 plan continues with 3 combinations unless data changes, aiming for seamless transition.
• Q: PSMA pricing pressure contagion. A: Managed through innovation, clinical value, and life cycle management strategy to address pricing pressures.
• Q: Aluminum fluorine technology commercial implications. A: Allows interchangeable use of gallium-68 and F-18, fitting vertical integration goals. Focus on customer preference between F-18 and gallium through distribution and commercial networks.