REGN - Earnings call transcript Q1 2018 | Regeneron Pharmaceuticals, Inc.

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Operator

Welcome to the Regeneron Pharmaceuticals First Quarter 2018 Earnings Conference Call. My name is Jason and I will be your operator. At this time all participants will be in a listen-only mode. Later, we will have a question-and-answer session. Also, please note this conference is being recorded. turn Relations. over now Head Manisha will Investor of I the to call Narasimhan, And

begin. may You

Manisha A. Narasimhan

Thank you, of morning events XXXX be Jason. Good on for conference first Regeneron available call. quarter XX Pharmaceuticals days. An website archive our this will and webcast under welcome to

but and or as Commission of later XX, obligation forward-looking and information, forward-looking SEC matters, its Each for litigation a can whether today. including differ Exchange any actual not other be Joining and from the A McCourt, Securities Head or and President filings Chief will Q&A. are the Officer, for with statement. events does new not to intellectual Marion related Regeneron's those call Regeneron Landry, today Dr. President call and pending in Schleifer, Founder, anticipated that Bob undertake publicly which Scientist, forward-looking with me to development Chief Yancopoulos, limited Executive remarks subject risks and President like on more prepared uncertainties to projected Commercial; XXXX, and business, March Financial United related and its be Founding I Vice is could result that and those Vice property, on guidance, any the these results future milestones, events include to Senior and include risks competition. of President After and remind the collaborations, quarter Regeneron Officer. open Such description States complete you Officer; cause remarks, of today materially ended and Leonard regulatory statements financial are that would material to Dr. finances, also otherwise. programs Regeneron. and Form forecast statements to XX-Q Senior George statement and Scientific call will we this about Chief found products made in may update our statements filed the SEC

call. please is our reconciliation call that of measures the release, will financial non-GAAP today's financial on non-GAAP available Information to regarding GAAP GAAP discussed in that, Landry measures Len our let Chief website. a IR our can in addition, In further press Bob use results turn over President to and concludes, team questions. and note which answer and of Executive be to Dr. those will Once be and be our me Officer, available the call Schleifer. our accessed With measures

Leonard S. Schleifer

morning today's my Manisha. you, strategy. our that Marion joined prepared recap will And our In Thank results. Good how enables on our call focus you Bob Regeneron's on on of to provide remarks, strategy. who realization everyone I George and webcast. will level us has will on details will commercialization efforts R&D the which and prowess supports status strategy. will update of drive the our financial high

taken with has over terms many administered to the launch. begin EYLEA how me since diseases. approved brings XX both well globally agent as very retinal of business. with much been has our anti-VEGF as doses for in been patients a product vision retinal EYLEA. as it it brings of diseases, value Let threatening how value successful in EYLEA than have leading Since XXXX, million approval EYLEA market to late FDA More

We long is first our many Clearly, our billion. net EYLEA of have the naturally questions over franchise the and the sustainability of important were global at During near term. of EYLEA. $X.X late-stage were and quarter bar the differentiated have likely from our products to believe expected a no that space EYLEA are the of in shareholders product anti-VEGF substantially the sales in XXXX, development about sets most EYLEA while product is high and of XXXX, around late the profile knowledge EYLEA competition profile to therapeutic there that moment, very

In addition, the prevalence diabetes. but for as increase well upon the unfortunate growth of in based of dramatic significant see aging we population as the opportunities the

diabetic EYLEA diabetic focused well-penetrated Currently, expanding diabetic the macular While wet branded of disease. without is a have why is diabetic remains in diabetic eye treatment we having macular suffer where EYLEA and edema. opportunity much in macular NIH-sponsored condition anti-VEGF market can supported in eye are this study. the from on for we by is a our That T indications age-related disease diabetic there retinal of also the patients edema Many retinopathy large leading called untapped without macular diseases. Protocol indicated results edema from degeneration,

catastrophic at high patients based these plan we the EYLEA sBLA at DME diabetic from without an upon the were retinopathy submit months. complications. Some Later results initial risk suffering in threatening with for observed in of are vision that striking of six study PANORAMA to this year approval

complications. challenge a study But EYLEA also PANORAMA of prevent the the success of to evaluating We look ability creates forward we results where EYLEA to from longer-term will threatening the vision be diversify I now for and profit am put can to place years the we say many we starting ago fruit. to Regeneron bear that to pleased in base. its strategy revenue see

research continues and as and research Alnylam others, new create be our with to to heavily invest capabilities in rather to products. partners, for we than such strategically opportunities. combine externally internal do collaboratively was strategy Though capabilities new Intellia, product our look Our

stand? From is strategy we a broad So working. perspective, our do where

development, medicines specific from strategy, immuno-oncology. in I success FDA approved areas, six But arising efforts. and of internal like XX our have near-term would different terms of diseases discovery two to product this and candidates We all from evidence the highlight in allergic clinical

we in patients and diseases allergic for in adults Our product. atopic Dupixent allergic approved adolescent trials Dupixent pipeline iceberg, atopic the pipeline which the for our clinical dermatitis, necessary of of with the active in allergic that a is a would launch currently dermatitis, asthma, another development or in a adults ago States in launching is as patients completing with evidence this for dermatitis United severe decades another X support is quite We very X of dermatitis substantial opportunity. Sanofi the from study Phase be this Sanofi, of with Dupixent Dupixent, the polyps. to Phase world, atopic we're may remarkably are are fully our execute year pediatric We are to significant and that midst the Moreover, Top so number anticipate seeing well patients strong dermatitis, process plan have we, believe because moderate have of going deep atopic just regulatory collaborator Type the of line under rest And different the adolescent dermatitis was again efforts X the there tackle we and once Dupixent a itself. broad to with committed the represents disease, But way pediatric resources resulted atopic and and along in nasal within adolescent our later expansion tip with which with true as collaborator expected year. opportunity. Dupixent is and began atopic study in trials in called and approval polyps in Dupixent. well. the into and asthma later data nasal the pediatric

large plan the addition, another of to in opportunity. in this studies we In very begin year, second half COPD, pivotal

allergies late-stage and and in also later X year. eosinophilic initiate in program We a this Phase esophagitis a will grass program peanut

of just our or not of the realized X we IL-XX Type antibody drugs Finally, other a the for is studying the potential allergic allergic address anti-TNFs view, evidence we is drugs these but bend in short, We that analogous rheumatoid In arthritis, X or of our overactivity disease. allergic the immunity. indications. the is compelling that combining dermatitis, the with potential has of be may that different the that were Type drug X potential multiple when Dupixent thus to able Dupixent Dupixent think several far to was involving many diseases what Type for be but not believe Dupixent happened pipeline will In it to just for for diseases. atopic arc

another let's our pillar to of the immuno-oncology. and is diversification Now, strategy, area of turn that

and candidates Immuno-oncology player transformed treatment to out of we be opportunities the believe tools, and is compete one commercial the in largest clear, this the win. a biopharmaceutical space, of to science, be me is industry. has turning the in our technologies Let the importantly to most that and goal history cancer the product major and we become have of

cancer. anti-PD-X sales across rate and in cell number the use are a example, $XX in antibodies non-small of by cancers at annual lung a global For large driven part currently still of run billion growing,

right to development. this of in is drug therapeutic terms of of important strategy candidates selection states proving targets, selection initial and engineering of spot-on be disease molecular the area the Our complex for the in

our Cemiplimab, out have for selected we as we our amongst previously cancer, solid awaiting FDA. CSCC. served in VelocImmune seen upon antibody, opinion select antibody cell for over highest PD-LX has data. of terms an the are designation chose In this available PD-X response our we breakthrough rates the right action produced PD-X to and a a in by or and to squamous leveraged turns are be CSCC, FDA targets, data and indication. breakthrough group clinical carcinoma, cutaneous important our choice the the and The the reported Moreover, that for technology our tumor excellent basis overlooked we based

are cemiplimab. largest indication is is opportunity studying a significant the itself, cell by While non-small CSCC lung we cancer where currently

advanced from non-small to early be this lung positive These a annual Our cohort will cell data forward cancer aggressively at with disease. supports multiple conference. the of upcoming move ASCO decision patients in data settings of our small presented

complete the end comparing cemiplimab to year Our cancer to next on first-line study early around chemotherapy of enrollment track is lung this monotherapy year. or

immuno-oncology to to of our years cemiplimab the be expect for foundation We come. efforts

our our component platform. immuno-oncology is bispecific Another strategy of

build biological molecules functions. capabilities combine are and targeting technical We effective our and to tumor combining that

antibody, excellent owned the Regeneron, is Our progress entirely clinic. CDXXxCDX in by now making bispecific

an Other include You both we meeting. anticipate year. about the into BCMAxCDX, and this of clinic upcoming will this hear at and medical advancing MUCXXxCDX which George more from bispecifics

you are bispecifics we Much course bispecifics. molecule, the combination PD-X a candidates a of and be to platform treatments that stream of involving for our most steady our potential towards our of be importantly, a able has class we we this potential within pipeline clinic. drug about antibodies. strong see And and produce believe bispecific CDX will well. we moving antibody bispecific Additional as information a Perhaps, new believe cemiplimab Dupixent, is to new giving over the year, like the

believe has opportunity recap, for continued So to meaningful additional growth. we EYLEA

to With our as call us that, over on deep strategy and rest let and to along diversification pipeline Our we continue aggressively deliver continue commercial clearly of success, will the to Dupixent potential our George. position the the track well. of turn pipeline immuno-oncology which to franchises, full is me move the well

George Damis Yancopoulos

and Thank a you, Len, everyone. to good morning

XX% I and the perspective, this has The patients improvement first XXXX study the less and with reported of Beginning data we in receiving than productive compared weeks, No greater XX a to baseline been two-step diabetic or Scale, observed. highlights. from a sham R&D provide EYLEA, injection, of on retinopathy. some positive receiving Retinopathy PANORAMA EYLEA busy will experienced signals of with Severity at quarter safety In the p-value of of patients X very were an X.XXXX. new from study, Phase key Diabetic X% from

that severe macular Importantly, was severe without non-proliferative time with first reverse diabetic designed to to ability study any therapy to this a in retinopathy demonstrated evaluate disease the patients specifically progression diabetic edema. the moderately

edema. and to also EYLEA treatment patients progression prevent for longer durations to to determine We complications macular neovascular whether evaluate to can will diabetic these vision-threatening continue

from showed We their expect data Praluent, risk and the year. that study Praluent Annual American associated deciliter, reduced to In experienced which of XX%. LDL a pronounced Praluent, of levels outcome United Meeting a we adverse of events of risk with of Safety safety These College previous the all-cause MACE per In reducing in lower major of Praluent heart death issues the Cardiology, cardiovascular cardiovascular patients rate this States from baseline regulatory data at new to positive at no these were maximally-tolerated cholesterol high their a was trials compared or risk a make death. by disease coronary March, pre-specified from XX,XXX MACE XXX consistent was by above the submission patient and significantly the benefit with in risk the of patients with statins. observed. reported and milligrams XX% more or analysis, later

are group, was In pre-specified the lower death published a additional These this in LDL and Praluent XX% results any association analyses cardiovascular Association post-hoc LDL XXX cholesterol that of the the cholesterol whose American was and associated mgs Journal greater recently more showed of risk of an deciliter. mortality total patients between of from reduction Medical with greater the risk with meta-analysis per cause. baseline in in a lowering intensive than consistent

these the for pipeline. the middle regulatory Len based We year. of data on to submission the the enthusiasm shared FDA expect Dupixent a our has around

treatment October. the Detailed Phase Our by X in regulatory and currently upcoming submission be the Society. studies asthma for VENTURE a with Dupixent adolescents FDA of date for meeting in is American the under adults Thoracic results at and uncontrolled QUEST the PDUFA presented the asthma from of review will

study X is setting Phase asthma under Our of the pediatric in way. currently

also have We of studies ongoing Phase Dupixent pediatric and dermatitis. adolescent X three in atopic

of aged line scientific these, old old, and currently we we to used Two immune data shortly. to X is Type a in report of X months in conditions. and first studies, the second enrolling. between expect years The or that be in fully believe XX the years additional could XX XX the so-called dupilumab top and allergic ages adolescents one X on old X children children pediatric variety to pathway, in years Based aged are of enrolled

We with in expect later dupilumab later a nasal patients as to this in as conditions data of in X polyps to and co-morbid report of well two from year. plan esophagitis. our top Phase year, Phase We initiate, this dupilumab X line study COPD in eosinophilic programs studies

in plan XXXX. of peanut studies We dupilumab to grass in X also allergies Phase launch and

human year in X without of this in initiate with have Genetics Let the in studies you of dupilumab, Phase XXXX, of X XX preclinical plan A antibody, patients our XX some atopic COPD. from me our We second genetic interleukin the is together asthma and study fully these additional findings support benefits being of that some with remind and treated with dupilumab IL-XX our Regeneron and blocking Phase that interleukin human half patients. for enrolling diseases. to Regeneron might hypothesis the dermatitis studies, Center,

we heard by our most towards antibodies. field of antibody immune approaches exciting system As portfolio bispecific one harnessing cancer. the areas immuno-oncology by on of of have Len, from provided you of our Founded our the where also the is opportunities important focus fight to PD-X emerging multiple and

equivalent the Early you PD-X also with realizations. on, that prevailing there the blockade view approved. there remind me been that would thought pathway, some be surrounding be PD-X agents excitement have a pathway Let despite many commoditized sobering the that many would

PD-X believe first many those two than against non-small-cell PD-X the As Moreover, cancer. PD-X are only and – out differentiated as active ligand. been PD-LX it one now antibodies, line approved of stands, antibodies that more approved against the has in monotherapy lung

would cemiplimab, much has the the October, be this not PD-X of more is FDA more most there in immuno-oncology in Finally, provide to profound program. need. And the activity room benefit Obviously, Later date much in others. in respond. where our which pathway lung cancer approved breast development the having many PDUFA settings antibody, comprehensive many cancer third like the drug in approval cancer, prostate, the with we do to patients and colorectal, the pancreatic PD-X not anticipate year, prevalent first demonstrated most patients of including even active, is still settings

bedrock addition be In cemiplimab opportunities we monotherapy combination to which with believe to will upon build we cemiplimab, additional plan therapies. the

in you be cutaneous anticipate sharing carcinoma in patients of cell additional carcinoma. upcoming At cell XX%, with to rates Meeting, will any with We positive observed ASCO cemiplimab around unresectable an data cell metastatic locally-advanced to-date overall reported squamous for look a Cutaneous metastatic response forward solid of which in the rate Annual seen cutaneous squamous indication have we data PD-X the among response highest carcinoma, the approval is we cemiplimab. the where which we antibody. malignancy and for squamous first with

squamous activity be from will durability We carcinoma study. X our presenting pivotal and cutaneous Phase also cell the

cancer. in Importantly, we're also non-small conducting types, studies second and cell additional line cervical lung tumor including first and cancer

As this Len monotherapy demonstrated lung cancer activity only opportunities most is one for blockade, the in convincing mentioned, first PD-X non-small has line but of exciting agent one setting. cell

trials, major as cemiplimab this successful, Our a three program competitor key in space. which, includes position could if

is is we XX% early and patients completed enrollment PD-LX This year chemotherapy study or later this ongoing to study next first expect of who cemiplimab greater. year. The monotherapy or in versus expressed be

versus in second trial combination or cemiplimab or with XX% ipilimumab also with with greater would to study is patients with in or combination without with study alone PD-LX patients comparator chemotherapy with arm. ipilimumab this this around PD-LX Cemiplimab, expression, study midyear. We a pembrolizumab plan enrolling. lower. This chemotherapy chemotherapy in include initiate of XX% expression The or in of without currently

Turning our as bispecific with combine platform, opportunities, as to opportunities provides antibody cemiplimab. which monotherapy to well

you wholly-owned We rituximab, where bispecific are like in antibodies, of molecule as to compete are remind such that molecule indications, currently clinic. efficacious, progress would in antibodies longer a could This lead CDXX well of CDXX this CDXXxCDX standard Our no to continues care. the as is where molecule. the as

this have later expected we more enter activities forward medical conference maximally-tolerated clinic dose-limiting are data our to at our two, potential dose. to at bispecifics. any doses increased or reported we rituximab signs to dose greater, at And of were observed XX% were rates second bispecific our reached to including and dose-limiting in CDXXxCDX platform our deliver we with toxicities. this bispecific. yet toxicities clinical candidates, sharing without of the lymphoma upcoming heavily-pretreated We we year. patients As without refractory non-Hodgkin's the control in we MUCXXxCDX now any disease has response ASH we We look rates thus, half XX% year, escalate not of seeing are additional BCMAxCDX believe last continuing that almost At the November, a encouraging X and doses, higher and reporting milligrams which

class share of with later antibodies We new more hope bispecifics about advancing you this also class to this are year. bispecific of and a new

the be data evaluated dose our safety committee that risk pain. lower continue An that the NGF higher-dose program and for efficacy regimens. regimens based independent fasinumab, assessment trials benefit and clinical now discontinued Turning on and recommended their monitoring of the ongoing antibody the the with to

our We year. talk X programs will wasting such In the Addressing description sharing results ossificans ranging to Please Phase are clinical to involving highly-prevalent modifying ongoing condition, interest call remaining which refer muscle over programs. diseases time, anticipate metabolic is XX-Q, all I our accordingly. from disorders. many ultra-rare the conditions our a as an top pipeline. the in the progressiva I line this to the of studies study from fibrodysplasia and of about later Marion. Form not of We now turn will of

Marion McCourt

Thank you, In global branded EYLEA the a George, earnings XX% to the about team. I'd represented start continues U.S., it diseases net branded this United on be where the quarter the call EYLEA, call net is is for $X.X were sales of billion. my to the and good to the pleasure It's and in everyone. which with EYLEA morning, of first Regeneron market. to were today. million, like a privilege be $XXX with States. sales wonderful be part first retinal market-leading This anti-VEGF in overall

increased share balance XX% quarter, DME, year-over-year. come conducted Our on the Based the from net of the coming slightly of branded that and EYLEA dollar about currently AMD indications. smaller market from first a other about with from U.S. XX% wet in survey estimate sales we we

aging we expect increase the in of our growth. the prevalence market diabetes, population the future With significant of and dramatic

EYLEA major opportunities the two see we grow ahead, to franchise. Looking

we positive in we of year. patients The approved such diabetic expect with Phase reported used diabetic a X the be make expect from spectrum If submission data full regulatory study as recently eye EYLEA through in and retinopathy this is PANORAMA where could first diseases. the later that retinopathy, diabetic to additional indications

patients is This are even it for with diseases from well dramatically and true and undertreated eye retinopathy. edema suboptimal diabetic frequently when therapy. is treated, as diabetic from underdiagnosed macular suffering Secondly, diabetic both as

recognize the to to approaches the that term in proposition academia to therapy treatment opportunity every XX-week X-week tailored in requires strengthen is further patients the indication. label patients diagnosed before with wet in EYLEA in our approved, industry, could only patient and addition identify diabetic if wet efforts, EYLEA EYLEA XX-week this dosing increased this be DME to drug on will flexibility through a loss. many FDA impacts have and PDUFA PDUFA, date near monthly approval that to patient and currently approved vision with expect We AMD a There therefore, each on provider regimen XXXX. have suffer every August the these to receiving AMD wet to or retinopathy flexibility. similarly use for being catastrophic require result studies ongoing and patients, they basis that treat with We and submitted also intervals. successfully they regardless in more are AMD We both remind X, and dosing X, our of frequent develop approved they goals optimally patients dosing and of dosing fixed value the from in interval the FDA A met an to we dosing application patients after following only every is for Phase potential whether weeks. XX-week in interval outreach the treatment XX a education you were X more go extended and is

million. health treatment providers prescribed XX,XXX of net sales that depth satisfied, rates Underlying from more consistently treatment, prescribing be were of net as $XXX half now XX% XX% quarter prescribers Dupixent quarter with their added patients the their our each are to with to million of Dupixent, advance demand patients has Dupixent over week as having collaborator these refill lives among with course to Moreover, XXX of Sanofi number strong to recorded on referred we're of getting first the and prescribed approximately well a prescriptions, practice. to as first their or therapy. and Over Dupixent the with drug of over highly the see during continues care the Turning have last on high nearly new first quarter. XXXX of been approximately as up sales beginning persistence through in the patients three patients to by HCPs U.S. the we were sequentially first $XXX patients patients. global started total frequently and Dupixent Dupixent transformational users XX% year, the the remained of who of Over quarter.

increase appropriate further recently awareness patients in seek state disease commenced order have TV and awareness airing atopic We treatment. to of a advertisement dermatitis encourage national to to

also to plan campaign direct-to-consumer air on year. (XX:XX) of second We the in the half

We have high and are market adult expectations in continued optimistic throughout atopic this the world Dupixent in planned about for in the indication. growth U.S. dermatitis launches in multiple

a in which beginning prescriptions the potential In growth in trade the also eosinophilic anticipate year and indications addition, impacted pediatric believe specialty point of which care by program is U.S. we total are other by sales asthma quarter assessing the high patients rates. in at assistance products. launch inventory as persistence dermatitis, of look polyps lesser high costs for the much typical the of to better meaningful quarter-over-quarter to and Dupixent opportunities for movements, the the that both Dupixent at sequentially were increase and such extent, and in patient new for in metric first atopic We nasal pediatric and increased were esophagitis. and and product added, adolescent adult and a in this XX% net

launch PDUFA As completed this XXXX. our George, We, an indication collaborator, preparing are later indication regulatory this our with you asthma heard Len in anticipated in a Dupixent FDA anticipated both submission for in from October with year. and the we've along date for Sanofi,

week, selected PCSKX for we access our Sanofi, net earlier sales have payer the on in the first strategy to were $XX this agreement cardiovascular by reported easing million. Scripts pleased payers We've announced significantly new Turning with Formulary. appropriate and to with net price National to We're patients collaborator, Praluent which data quarter just was costs. inhibitor and our the for the and as Sanofi positive work straightforward to implement a of Regeneron in continued commercial exclusive out-of-pocket Preferred Praluent, Express return the from Praluent in the study. as very agreed outcome global reduce

data. Sanofi productively several plan authorities engage a continue as rheumatoid to the We million other our $XX submission cardiovascular our arthritis. of payers. the make in quarter. based Global sales IL-XR collaborator to antibody We with first by to by Kevzara net outcomes on for recorded midyear regulatory Kevzara is were

crowded the well we improvement in it notably, and differentiated disease product profile. Although Most believe progression. opportunity market that significant RA radiographic is has represents Kevzara a the

U.S. secure approval. A announced work prescribing commercial estimated XX% we approved. are a short study to are unmet We by indication for launch training week initiating U.S. leaves Application Sanofi payers field-based to application from we giving decision with is and immuno-oncology, XXX,XXX in our and years we access and of health driving worldwide. patients effective with the and need XXXX. on immuno-oncology is CSCC continue half team somewhere of in that treatment patients, the accepted ensure Cemiplimab cemiplimab our as treatment that our sales. between having patients advance cancer improved Kevzara. across Simultaneously, Ultimately review, option. have as in in been to are these potentially for diagnosed are possible and date depth an to care our first efforts License have all working come where regulatory specialized to of breadth following skin with our about with In providers. the accepted quickly our XXXX. to been ready immuno-oncology PDUFA first or to moving patients the three is by and This we've majority expect surgery. hired cemiplimab thousands gone the of the the lead squamous that an European as will Biologics U.S. we facing in immediately this In CSCC ahead the Medicines we product annually speed the October priority In a for CSCC first FDA first and just commitment preparing to in also and be unmet need. Even collaboration PD-X the significant cell advanced a potential taking advanced Agency cured report for this the has vast our down common them experienced It's of treatment EU cutaneous team second so The for approvals full XX% cemiplimab antibody and most U.S. with CSCC. carcinoma clinical

at While journey. studies Phase FDA hard X are vary, face data for CSCC, and sharing die anti-LAG-X for proof annually. are patients cemiplimab. look in in updated with is both there look progress a advanced trial Cemiplimab X,XXX being forward that approved cancer EMEA as XXXX, X June suggest non-small candidate X,XXX patients a Regeneron our to and monotherapy these of clinical treatments and for cell And the first poster I to with in call a turn CSCC Phase treatment ASCO. to Bob. long currently from estimates abstracts or they and lung which the Today, a concept both no studied combination between our at Among our We accepted and that data this

Robert E. Landry

everyone. Marion, good Thanks, morning, and

net year-over-year of increase represent These year. XX% $XXX I'll first of today's performance our has updates Regeneron's solid per a quarter XX% income, XXXX a million first our diluted in EPS non-GAAP discuss established During full and our non-GAAP line results XXXX EPS financial call net and share income the quarter year start to XXXX diluted guidance $X.XX respectively. and provide on for items.

company's Sanofi yet by of experienced XXXX. on fair modest Standards range. $XXX to release, of forth recognized non-GAAP of website. first $X.XX million earnings within U.S. fourth flagship compared our a of recent in a earnings As one XX% to is net set EYLEA increase our XXXX targeted XXXX, EYLEA the with in which excludes the and in inventory reminder, lower in Development franchise to million in adoption commercialization two-week beginning by quarter first December sales a Total the higher with can Preclinical United of contribution expense Accounting product GAAP the revenue full Dupixent. Partially share-based non-cash grew non-GAAP found continuing on accordance $XXX year-over-year XX% from the revenues offset this connection quarter net be sales the quarter of value contribution strength Discovery with driven and investments XXXX. billion, Update in States to income quarter our A XXXX-XX. compared EYLEA our normal reconciliation remained as that from Regeneron's and in and changes grew distributor equity net in ended XX, Agreement compensation

during of U.S. decrease Offsetting our were R&D U.S. of Kevzara, agreement The Praluent profits reimbursements no Kevzara, million revenue our revenue Global in net of of XXXX rest first first commercialization quarter Additionally, $XX quarter first million. and collaboration Regeneron for quarter The primarily the the an Agreement. of decrease the Preclinical with split sales compared to in of quarter in the connection and recognized In XXXX primarily million Regeneron XXXX. first to Dupixent, Tanabe the loss quarter first XXXX, was increased programs. expiration first products XXXX XXXX. the reimbursement million related and the revenue the from other from $XX $XX of NGF recorded from to for higher deferred three partly higher no compared months with and recognition our by reimbursements compared to XXXX in decrease a driver the reimbursement in the of share collaborator, collaboration in increase revenue the year-over-year Discovery million XX% from are million the provisions incurred to million The our and this reimbursement We quarter Praluent A XX% of of with in offset to $XX March U.S. losses of EYLEA a $XXX fasinumab, which operational the million; world release. investment Development of by of and revenue of $XXX was primarily continued due significant versus share Dupixent's million; first this as payments, quarter from quarter and share losses Regeneron in million XXXX, revenue and XXXX. of Sanofi, sales, $XXX XXXX quarter lower the set quarter million revenue $XX which Dupixent, expenses, attributable sales in Pharma. quarter year-over-year representing related to outside R&D the gross EYLEA's to a Mitsubishi XXXX of of first development Sanofi revenue million antibody the were Dupixent, first incurred Teva deferred of $XXX commercialization in of of compared launch. our connection these and recognition the net slightly increased was our the to revenue reported revenue rebate consists loss XX, the this up-front expenses Sanofi for of was $XX March with product as This $XXX antibodies. commercial of EYLEA compared sales of due R&D in sales our percentage XXXX, commercialization Ex-U.S. a Total of Teva, immuno-oncology of our the net Kevzara, from of of for in the associated of first first of quarter million out as the our press first share government XXXX million by and in collaboration quarter of on late was increase $XXX for recorded item loss the XXXX, first Bayer, U.S. as were for ended this In in collaborator Sanofi given first quarter the quarter. of and the to XXXX our Praluent, collaboration to Bayer line net sales quarter million of was compared with basis. immuno-oncology Total expenses for comparison first associated revenue $XXX program is Sanofi was $XXX collaborator, XXXX. XXXX. $XXX XXXX, of collaboration recorded

can As of our other of summary the find reminder, XX-Q. section components a the a of you revenue in MD&A

R&D first XXXX. development result the Turning non-GAAP were the of fasinumab costs. the expenses, offset programs, first increase was as clinical of for now for in lower R&D by compared million $XXX quarter for and expense to million quarter cemiplimab clinical of The expenses XXXX, the to manufacturing $XXX non-GAAP continued late stage

the expiration end Sanofi during Our XX, and and the our increase was quarter XXXX, three Agreement our collaborators of million unreimbursed the offset XXXX. to the higher fasinumab. collaborators, months received the at first $XXX primarily compared ended calculated R&D for the XXXX, the from by resulting Preclinical expense million XX, as total for received R&D Discovery of XXXX, months for expense, driven This Development in R&D ended March cemiplimab $XXX non-GAAP is by reimbursements March reimbursements was which less three non-GAAP from reimbursements of from lower

includes Our calculate press expense. required release unreimbursed to the information non-GAAP R&D

billion are guidance billion be tightening $X.XX to expense guidance $X.XX full for $X.XX billion previous of R&D XXXX our to We from year to $X.XX our non-GAAP unreimbursed billion.

was for three as quarter XX, the million to $XXX Next, the ended first expense non-GAAP XXXX. $XXX for XXXX compared SG&A million March of months

approvals XX commercialization as increase and in the ongoing for noted SG&A commercialization as on due for increased February our launches and with call, As the expenses anticipated U.S. eye Kevzara, the to we earnings well in asthma. disease, for in higher XXXX CSCC XXXX focus an Dupixent dupilumab year guided compared this to in originally expense cemiplimab EYLEA an diabetic

commercial our from billion related within explained G&A first expenses, of year, expense half the Sanofi of to Regeneron billion to in tightening quarter the non-GAAP item a found is first $X.XX XXXX SG&A billion the was $XX Although million second we to reasons $X.XXX spend SG&A quarter the and year lower expenses previous to collaboration to non-GAAP lower in full still our guidance Sanofi for full revenue $X.XX line Regeneron commercialization and year range billion. of XXXX be reimbursement $X.XXX XXXX. XXXX of for Praluent comparison due SG&A in above expect higher forecasted lowering

Regeneron expenses of commercialization to We $XXX $XXX from to to are our million. tightening million million $XXX our million guidance full be year $XXX XXXX related previous guidance for reimbursement of

Turning now Act quarter the as XX% the was first as operations effective from in the Tax lowered and enactment improved was the of first XX% driven by XXXX XXXX. compared of tax as tax primarily our quarter taxes, difference first for Jobs to rate Cuts results international corporate compared The quarter our the well U.S. to rate the XXXX. which to

Tax Cuts and full assess rate now Act, full XXXX additional of the As expect XX% our the impact and tax Jobs guidance, to of versus previous year guidance our to to XX% we be XX% regulatory continue await effective XX%. to we

credit than rate to income XX% quarter and of activities. effective first research foreign-derived U.S. new Our due tax was the the federal new tax federal for lower XXXX rate deduction intangible statutory the

the of stay expect Jobs regulatory tax to rate. in deductions XXXX mid-to-high years, with compensation the teens. stock-based rate Tax could the Over few future under invariability next our Cut we for and tax guidance would effective Act consistent effective Regeneron's impact guidance Future

million. generated Now to quarter Regeneron cash flow marketable and in balance billion sheet, XXXX excess securities cash the ended flow of of of cash the with and and $X.X $XXX free

capital were the $XX XX, Our ended XXXX months March expenditures for three million.

of year we as $XXX spend call back like As $XXX New now space manufacturing $XXX to would and our the a capital prior a as Limerick, capital expansion result are turn million facilities. facilities XXXX Significant our forecast, within full million. York projects first tightening guidance New from year XXXX levels range quarter full in of to of the and that, expenditure million of York revised be Ireland, our renovations include million With and to well $XXX Rensselaer, Tarrytown, I laboratory our Manisha. expansion continued to our to

Manisha A. Narasimhan

Operator, for the prepared Thank We this like portion open the you, our remarks today. call would now Bob. concludes of to Q&A. call

Operator

we Thank of you. from Merrill Ying first, And Bank Huang America have Lynch.

Ying Huang

morning. Good for Hi. questions. Thanks taking my

maybe about elaborated more since and So George, Len PD-X even plans. you the

because can molecule molecule to from lung way cancer. behave? Is for designing non-small it's would elaborate fasinumab, is be Bristol's also explore Or think the to PD-X? little recent the a potent How high you're line Thank strategy causes cell same data that it in KEYTRUDA just one see And more in a to the be a such dose OPDIVO and we first both? quick Merck's it even on a side more Is do you you you. your which going combination dropped? than effects osteonecrosis. you Given the better are trying then what

Leonard S. Schleifer

ahead. George, go

George Damis Yancopoulos

for is This question. Thanks Yeah. George. the Yeah.

that important is line terms seem number patients all up, is advances indication to and most now really which active in we excitement and the and of of line it setting they lung as pretty PDL-Xs where the that try PD-X to in I right first think with despite sobering be cancer. the

OPDIVO, even As disappointing. quite data, look by far And the it has KEYTRUDA. know bar the the we all with PD-Xs you meet the at been of actually if to data from fails

clear have that explain which unbelievably there you So in whether We do in will technology. said, the a technology and delivering molecule the PD-X line a right past now, as great that we've try that best believe, data space, that this on solid we for our this has the class have of KEYTRUDA. and indication comforting settings what in has already of that, series only some we is the to succeeded described, first data leader we in in test carcinoma in very impressive molecules, in VelocImmune some is And of opinion, and of agent. one, as is top class, tumor cell a we've in lung our studies enough, the cancer is of designed the best-in-class squamous ever described first which

in give a this our deliver of first-line lot on going order competitor to data combined major space. us KEYTRUDA So cancer the studies -like would a which these make basically hope are of to that us real

in So opportunity molecule the hopeful and we about the come are excited studies through. that the very we're very will

been In about described this well-demonstrated more before. this fasinumab, the class molecule side also past. It's but has some as with pointed out, activity, that program there's question – rapid has second is obviously defined molecule osteonecrosis, that patients. And It's and it's the seen with already a we've terms pretty the of is you of in high-reward osteoarthritis it our your something high-risk, in effects. a not as has certain as progression this

at lower their we that took the and they benefit analysis osteoarthritis should doses coming what monitoring upper the did an from events progressive the two look the the and so data the to and And benefit of doses. two that terminate rapidly independent therapeutic decided is they to analysis obviously risk continue risk with compared these was the committee

so with their are And we recommendations. planning to the consistent studies modify

Leonard S. Schleifer

us. it, said that PD-X class bispecifics that add, new you're that for to just exciting it again Ying, of later aware saying proprietary based as we'll this upon to talk wanted combinations the that it's potential I in year think is and pretty our a our you said as but bispecifics I for models about with George well worth I of is

is So is run rate, it's clearly only the the monotherapy billion in although without lung opportunity monotherapy, with the a not the a huge evidenced which majority by of or cancer. immune-oncology $XX as single agent chemotherapy

George Damis Yancopoulos

as which that combination these excited with use existing of and are approaches studies we because is when sort monotherapy, also have term the therapies, we traditional our – we therapies new chemotherapy like almost many And about. Right. described, we're bundling we're in and Len combination of monotherapy as said,

Manisha A. Narasimhan

question, next please. Operator,

Operator

Gould Carter have we UBS. Next from

Carter Gould

being you're seeing, persistence for of you're should And be I Thank in about Marion, the Dupixent focus how data market on give your thinking therapy. Thanks commercial namely last question. seeing you. a the partner predictive just little Obviously IMS as landscape. lot we dynamics on more Good of the Can the on detail for morning. a taking week. maybe guess you after reported trends

Leonard S. Schleifer

how launch exact question. to Right. metrics bogged And – do Marion that But quarter predict we earlier as you down Marion let going. is her the is as the as comments. let reinforce answer sales. in We're Marion I'll I said, trying I'll don't the get looking at

Marion McCourt

Sure.

question And in So mentioned the encouraging let persistence. signs persistence on very, both as pieces, first. I two very take, Carter, me

XX% of their after the see refills we first script. that time get patients is First

one I that gave. that metric So was

over gave the on of over The period of was longer second launch, persistence patients of time I at course time and since was a duration one therapy that over XX%. looking that

metrics, encouraging. two quite So both

seeing of on some very growth long-term projections in comment profile product you're demand is NBRx of is the and Dupixent. would metrics performance including that our that is I say other terms is consistent we're we think the with talking the about for the other data what

that That's or X,XXX but we And month Dupixent. well about see Certainly going with pace, a patient a for to new growth very advance weekly stage. per basis we to getting as the we're strong work NBRx as So, mentioned through to new we're at quarter. I this filled continue the very going number a at their performance prescriptions demand see XXX week patients signal. on scripts on that

Manisha A. Narasimhan

next... Operator,

George Damis Yancopoulos

should numbers treatment. quite agents and you course And that impressive are are the satisfied the speak to need patients how once these the and year, of at to the are what other with we rates try the really persistent reinforce just over look across

Manisha A. Narasimhan

Next please. question,

Operator

Terence Flynn Goldman have from Sachs. We

Terence Flynn

strategy, had here Maybe Hi. the we might at are your And about some as Thanks looking data? bispecifics think combo the the is see you really, or question. big for taking we when initial immuno-oncology on as push of other disruptive Is as how a And of to second well? that your should we approach guys well? drugs. about have approaches cemiplimab Thanks. that pricing is somewhat think part then the you

George Damis Yancopoulos

George. types we well I the example, certain part for this will will about as forth. a this traditional bispecifics, both Len But of own, approach collaborating described, Well, vaccines of and chemo other checkpoint But first agents just opportunity maybe individually combination. that of of of such as as excited sort very people other things, take with traditional a of we're of so take George combining Yeah. our others and have cemiplimab agents, just our more the out, pointed including sort therapeutic that so series cemiplimab as second We're and inhibitors dual also in part. as with you with with and – obviously and is dual

So with set combination cemiplimab. opportunities of that's one whole

of for our bispecifics mentioned with hope themselves as the we patients in be also combination aspect individually have data as well. also of PD-X us we with combinations as seeing started have and new other which be bispecifics, as that Len existing can well by already bispecific be first But already we inhibitors the that class and year. I our with disclosing but we, other every bispecifics is therapies, that with dosing think, can agents exciting we as that reporting used evaluated have course this believe and the We of announced with of we'll and individually And or very cemiplimab. the cemiplimab the be over but will with one in this be checkpoint combination and well on

Leonard S. Schleifer

that model about opportunity trying been And have CSCC I of Terrence, know go might because to disease, an can many if We both that obviously hard fact as treatment still last in price, there's a on think our have and to to in elsewhere, of of reasonable and you although thinking there terms about CSCC our hasn't we it's approved you remind in and update. say for of drug first the therapy advanced patients you compete later, you're population, also very all, back how and duration look our we'll and long patient sized data. should just at

plays. So that

we with do. of terms are, price, know These we when In actual to to and we I come patients molecules you price let we'll high out towards value. the like think, value what

Manisha A. Narasimhan

please. question, next Operator,

Operator

from Leerink Porges We Geoffrey have Partners.

Geoffrey C. Porges

and, question no acquisitions. could Regeneron? very product Thanks Len, the (XX:XX) much shibboleths long-term no what of some no buybacks no dividends, is, like increases, address are Things you guidance, or now price

and sacred the XX% Given of fact the has its last the board you the of more that reconsidering are lost than year, value company these over any cows?

Leonard S. Schleifer

let's So to I'm not got one them down. take write I've by sure one. them

Geoff? said what say, product acquisitions, You did else you

Geoffrey C. Porges

long-term guidance. dividends, Price or increases, buybacks

Leonard S. Schleifer

down, go fast. increases, write down. ahead. Price can't I buybacks, that slow Slow

Geoffrey C. Porges

Buybacks or dividends, guidance. long-term

Leonard S. Schleifer

Guidance.

Okay.

the easy ones. take let's So

clinic. have X and We in approved XX drugs the

fill for R&D not are desperate one to people would And the of as want the industry. in I it don't up we compete work be senseless of as We in other and gaps nearly in own. we But sort prolific a companies. think are as have of most doesn't dramatically so what mean pipeline tremendous the of engines pipeline, it we our the other with us where market are over-paying to have companies to

going to some us You're to opportunities that we're companies of us. working that buying we just by exciting some disease small out mechanism, But Parkinson's no capabilities the molecule going a that what in make do very leverage spaces can other on. would just sense in X molecule for treats Phase more and terms for with do hear

George Damis Yancopoulos

mentioned, and are examples, Len with somebody which where capabilities Intellia something table, are, brings interesting we believe our very the research internal Len as as think leveraging synergistic. to I said, else Alnylam And is that very we

Leonard S. Schleifer

give we it's and Geoff, a is the guys will to that try knowledge any lot try we information don't our guidance, guess about why be of than asymmetric. terms also frank, you things But to don't guys guidance job team's a That's trying guess number be. and think, patients don't In to horsepower have we want where and we you kind to what are overpaid. spend internal of have, of intellectual of given our more

You those are guesses. supposed to make

company. guidance in So in is guidance the to about ton it the give a you to was make don't what we or get Bob of gives don't and there things I game on board of – guesses, don't the really information know. We there. game, that in because But that have have don't product not that lot that's you and want a

environment increases not In an terms you take where of this price increases, is price can easily.

the by increases the bad and or action, drugs or undoing inflation medical not so (XX:XX) consistent reasonable. towards be there's egregious in But approved of are where drugs a diversity perfectly think industry, are to want that increases of penetration or be price to new is growing potential taking felt can fundamental by have points. increase strategy. we the with strategy We'd price so us, worth there's that the government rather inflation participating much for emanate patients our don't we in much is our market, not price increases We bring small grow on

data. not of got discovery, terms what looks We're can with board with with the on with and aware partner team them can allocation, We you study does bolt-on regular at assure or and that our with data-driven. tell buybacks, all in We're financial I we'll a know In capital I evolve. this you all, do does keep with money as the them of basis. dividends, all, well the and the acquisitions, bank. discovery, we strategy about think acquisitions, internal We've them you

list, I Geoff. think covers your that

Manisha A. Narasimhan

please, question operator. Next

Operator

Matthew Morgan We from Harrison Stanley. have

Matthew K. Harrison

talked morning. question. growing EYLEA Thanks taking growth market describe for you've quarter. mean, I could that could in there a some then, the again. – and it guess, is trends harder you the ask describe you of faster AMD quarter, things market's Hey. the about you for underlying doctor, I on I Thanks. little And seen couple can like underlying that issues dynamics or either that the patients from those were see bit past in slower Good first just how of market weather, mean, DME quarters, about you just a the any than maybe I just if growing just to if still? get talk due the finding to or to

Leonard S. Schleifer

overall bigger growth big and have don't despite to EYLEA business the significant seen patients any have so background push for about lot eye always The to hopefully to some see broader seem but have we with. based the year-over-year. have of doctor much yet disease – and a pleased We diabetic impact that to fact But treated. see diabetic know. constant intraocular we inflammation, do We our retinopathy, hard approval has that we're to the indication diabetes, a in their had the do are to looking are yet It's doctor, we although levels, then made good are an to get demographics. there which still DME, that the so transient good on AMD a and and on more diabetes, don't. with the should quarter for that in people seeing which don't returned haven't is more there, with get growing in it's had that getting degeneration. kind AMD market, and because more big there said think was concern push I age-related monitoring it. I emphasize get there and longer I living still We're while grew people we by we're more product patients a we've because really well-penetrated, in to growth macular now, a the

Okay.

Manisha A. Narasimhan

please. Operator, question next

Operator

from Company. We have and Cowen Phil Nadeau

Phil Nadeau

questions. morning. on my those questions Maybe Good two taking Thanks to follow longer-term on for Hi. up questions, EYLEA.

hard on adoption theory, market, although it be said get our may first In to there. The diabetic retinopathy. large anti-VEGF non-proliferative it's a consultants

data? of can group larger population So be patient that you particular then, competition talk data second, week. we about susceptible care, on alluded perspectives your that to you from within that therapy? did your change us remarks, some standard Could you to the would anti-VEGF a on prepared in brolucizumab most see to give plans in this new the your in And Thanks.

Leonard S. Schleifer

the that I diabetic remember for this retinopathy, the year. retinopathy, Yeah, there's from real the me threatening Vagelos, back, the important first I to view. when be to diabetic you needle But retinopathy, well, or improving the him, control a the need was study cardiologists Roy prevent I the can to people told do think that able all look statin, market, complications, threatening that we those launched with go of from And statin, going will we're sight the thing no vision exercise told our simply prevailing only like if is so at he vision and a Chairman, and other PANORAMA onset mean, we diet not in any threatening. that later this the diabetic be the of mover talk the to data but

change really happen have integrated she's takes as based doesn't on that practice data, medicine commercial strong work So organization has so that us. really overnight. important to there is strong effort. to taken the you It and a really that's to how Marion on data. of We're do It excited into the quickly really something

sit sit your could approved, to urgently it sit see with – untethered sit diagnose by doesn't There years So merely it's have a a a whether or company in to drug in office, administer. diabetic of it is retinopathy that need a the doctor by That And device. a come, ophthalmologist, a could your you we're approval success looking could the that in area. a small by retinal to it forward, FDA it recent should could was over specialist and device practice could been the optometrist. in that not general store,

take a non-dilated the You retina. just of picture

and so data, And think learning to And there it, found FDA approved powerful when broad machine underdiagnosed you the of they've efforts to a this how sort or, intelligence. other of same condition artificial – more in have do about come I is striking thing of which drug And exact the call a the on. as screening. terms lot just were you and

we start when them. there's think I and that the front we benefit you of end at the really can lot the you who think label treatment So could have then people a to a and have broad of push

What way data, you in the much the want. heard that stay didn't terms mid-XXs I any about end the to those on RTH who data was the slice data, up could was think see at of of there. XX-week it But the In percentile people very you data. this the which I on XX-week went of day, new can

And you amount of people who vision a succeed based they carefully, lost, criteria. about one go getting XX-weeks I because who still if You're every identified XX-weeks. the people of at of significant was don't can that people on the XX-odd-percent the think, to ones haven't – and look are

plays they're wish would that a to the also have years because we we do should can something looks we help know to see if I bar I like, to But and say think really what okay and one label us. is to comes for people wanted – good hope, luck along be to that that, that's come. add because I thing. we out, patients, all chasing so them. with EYLEA George high what So I how luck them say, certainly, listening that

George Damis Yancopoulos

that Yeah, one about patients ways that. diabetic And, doctors referred treating said. the views some Len fact on you in thing wanted with and have retinopathy I little they expand perhaps Phil, to a that on to are cautious

who Praluent, risk define highest with is the vision we right key threatening what studies the I like of patients to we're at of are that now, of sort complications. aspect think did one undertaking the

therapy had So could event catastrophic risk a would you vision. them interested effective they preventative very having patients imagine they everybody, a and very be a much that more very, their using that if high knew might cost of doctors, in

preventing studies aspect population segment risk. high the not that at we're only of needing at of show part highest a because events, effective the they're So at such our of such the therapy but a for to is identifying these is that need

Manisha A. Narasimhan

please. next Operator, question

Operator

Next JPMorgan. we from Cory Kasimov have

Cory W. Kasimov

best my to forward. similar contracts PCSKXs going the to ask high-risk more with about to ESI? Praluent? those for from Thanks way a Hey. reimbursement define be benefit with expect how population would landscape with about are lines, guys. maybe morning, that exclusive should are regards question. of we how Should with Good announced one to patient the And most along more thinking payers the payers you getting broadly the Thanks taking we sense Wanted thinking

George Damis Yancopoulos

is inhibitor obviously. competitive another This highly out obviously a There's space. PCSKX there,

it we about that access. and sort the possibility can the we So of the a easy get will are improve peel so it excited can't back that patients doctor writes, to it. is it to for be make Make prescription approved that much, the too patients but there the fact afford

lost, both racing of wind – that We third that so that profit. the a innovators don't a no there's profit want pillar sides, left to make sure we place some which up to get for also, there's where the I on is want all we to don't

we're delicate out working affordability. a there we it's So hard and with compelling to all marketplace. access about get can but That's say

Manisha A. Narasimhan

be our so Operator, interest please this send please. And time this we e-mail a be questions of call question. up time an will follow-up call. some available to in next following answer But for question set also me and the last will we'll

Operator

from Meacham Geoff Barclays. have We

Geoff Meacham

guys. Hey,

Manisha A. Narasimhan

Hello?

Leonard S. Schleifer

question. you. Hello? We didn't hear last Great

Manisha A. Narasimhan

Geoff, we lost you.

Manisha A. Narasimhan

Operator...

Leonard S. Schleifer

Geoff. that fairly much me a question Thanks That all All it's right. self-explanatory. very Len. the Well, let great and ask was for quarter, for

its that think wraps up. I

Manisha A. Narasimhan

Operator, concludes today. call our that

Operator

This Thank you, may today's Thank concludes for participating and conference. and ladies now gentlemen. you you disconnect.

Regeneron Pharmaceuticals (REGN) 3 May 182018 Q1 Earnings call transcript