Analyst Conference Summary

Biotechnology

conference date: February 3, 2025 @ 5:30 AM Pacific Time
for quarter ending: December 31, 2024 (Q4, fourth quarter 2024)

Forward-looking statements

Overview: Growing revenue. Initiated a dividend.

Basic data (GAAP):

Revenue was $3.79 billion, up 2% sequentially from $3.72 billion and up 10% from $3.43 billion in the year-earlier quarter.

Net income was $0.918 billion, down 31% sequentially from $1.34 billion, and down 21% from $1.16 billion year-earlier.

Diluted Earnings Per Share (EPS) was $8.06, down 30% sequentially from $11.54 and down 21% from $10.19 year-earlier.

Guidance:

For 2025 did not give revenue guidance. Expenses include $5.56 to $5.795 billion in GAAP R&D, $2.91 to 3.095 GAAP SG&A. Cap ex $850 to $975 million. COCM (cost of contract manufacturing) $1 to $.15 billion. GAAP effective tax rate 9% to 11%.

Conference Highlights:

Leonard S. Schleifer, CEO, said "In 2025, we will continue to focus on our four blockbuster medicines as we progress our approximately 40 investigational candidates covering dozens of disease states with expansive market potential." EPS includes negative $0.11 impact from acquired IPRD charges. Has 40 product candidates and has already produced 5 blockbuster drugs. 10 late pipeline opportunities could address a $220 billion market [/what?]. But expects continuing competitive pressure on Eylea in 2025.

Declared first dividend ever. $0.88, payable on March 20, 2025 to shareholders of record on February 20. Also authorized an additional $3 billion in share buyback program.

Dupixent sales grew 22% in full year 2024 to $14.15 billion. Q4 Sales $1.5 billion. Sales are by Sanofi. In September 2024, the FDA approved Dupixent as an add-on maintenance treatment for adults with inadequately controlled COPD and an eosinophilic phenotype. Also FDA approved Dupixent as an add-on maintenance treatment for adolescents aged 12 to 17 years with inadequately controlled chronic rhinosinusitis with nasal polyposis (CRSwNP). In Novembe 2024 the EMA approved Dupixent for children with eosinophic esophagitis. In Q4 an sBLA for bullous pemphigoid was submitted. Also in a Phase 3 trial for lichen simplex chronicus. But there are new entrants in the atopic dermatitis market.

Competition is increasing in the anti-VEGF eyecare space. But HD is differentiated from other products. In Q4 2024 Eylea HD pre-filled syringe submitted to FDA; decision expected mid-2025. The primary endpoint was met in the Phase 3 QUASAR trial of EYLEA HD for macular edema following RVO.

In January 2025, resubmitted to the FDA the BLA for linvoseltamab, a bispecific antibody targeting BCMA and CD3, in relapsed/refractory (R/R) multiple myeloma. That followed resolution of third-party manufacturing issues.

In January 2025, resubmitted to the FDA the BLA for odronextamab, a bispecific antibody targeting CD20 and CD3, in R/R follicular lymphoma. Presented new and updated data for odronextamab spanning several B-cell non-Hodgkin lymphoma (B-NHL) subtypes, across earlier lines of treatment, at ASH. Expects FDA decision in second half of 2025.

In Q4 announced positive updated data from a Phase 3 study of pozelimab (C5 antibody), in combination with cemdisiran (siRNA therapy), against ravulizumab, a standard-of-care C5 inhibitor, for paroxysmal nocturnal hemoglobinuria (PNH). The treatment helped patients achieve and maintain greater disease control compared to ravulizumab.

In Q4 completed enrolling a Phase 2 study in obesity for trevogrumab, an antibody to myostatin (GDF8), in combination with semaglutide with and without garetosmab, an antibody to Activin A.

A large number of potential milestones are possible in 2025, including FDA decisions, new submissions, and new trial starts.

Itepekimab anti IL-33 for COPD in former smokers is in two Phase 3 trials with results expected 2H 2025.

Phase 2 obesity trial underway combining semaglutide with and without garetosmab is underway, hoping for better weight loss with muscle retention.

Regeneron is testing several potential cancer agents, including in combo with Libtayo and 8 different bispecifics, plus one CAR-T therapy. Continues to pursue siRNA therapies generated by Alnylam.

Future growth will be fueled by the breadth and depth of the pipeline. Genetic medicines portfolio pipeline has high potential future value.

Revenue by type: product sales $2.00 billion. Collaboration revenue $1.61 billion (includes Sanofi Dupixent sales), including Dupixent sold by Sanofi. Other income $179 million.

Non-GAAP results: net income $1.39 billion, down 5% sequentially from $1.46 billion and up 2% from $1.37 billion year earlier. Diluted EPS $12.07, down 3% sequentially from $12.46 and up 2% from $11.86 year-earlier.

See also the Regeneron Pipeline.

Cash and equivalents balance ended at $17.9 billion, down sequentially from $18.3 billion. $2 billion long-term debt. Full Year 2025 Cash from operations was $4.42 billion, free cash flow $3.66 billion. Cap ex $756 million. $976 million was used for shares repurchased in the quarter.

GAAP expenses of $2.89 billion consisted of: cost of goods sold $327 million; research and development $1.41 billion; acquired in-process R&D $14 million; selling, general and administrative $792 million; collaboration manufacturing costs $239 million; other operating expense $16 million. Leaving income from operations of $990 million. Other expense was $32 million. Income tax $40 million.

Q&A selective summary:

Analysts expect 7% decrease annually in Eylea revenue next few years? We don't give guidance. We think Eylea HD with profile and prefilled syringe as compelling, despite competitive biosimilar pressure on Eylea. We had a 46% category share in Q4.

Dividend, reasoning? We had thought to wait until repayment on Sanofi development balance, but we are confident we can pay that down. Remain focussed on stock repurchasers. Opens up investment to funds that require stocks to pay dividends.

Libtayo adjuvent CFCC data hurdles? Earlier-state patients, longer survival times. Confident the package will look attractive to the FDA. Estimate 10,000 patients might benefit.

There may be less competitors with generic Eylea due to some court decisions. That could help with maintaining pricing.

Partnering or keeping, operating expenses? We have an incredibly productive R and D capability. We are open to financial or strategic partners. We have no fixed allocation rules.

Eylea price increase, strategy? No comment.

Anti-coagulant? We believe ours is best in class. We also have a slightly gentler option, causing less bleeding. We see a huge unmet medical need.

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