Jazz Pharmaceuticals plc

Good day, and thank you for standing by. Welcome to Jazz Pharmaceuticals' 2025 Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Jack Spinks, Executive Director of Investor Relations.

Thank you, Operator, and good afternoon, everyone. Today, Jazz Pharmaceuticals reported its second quarter 2025 financial results. The slide presentation accompanying this webcast is available on the Investor section of our website. Investors should also refer to the press release we issued earlier today that is available on our website. On the call today are Bruce Kozad, Chairman and Chief Executive Officer, Rene Gallat, President and Chief Operating Officer, and recently announced Chief Executive Officer, effective August 11th, Robbie Annone, Executive Vice President, Global Head of R&D and Chief Medical Officer, and Phil Johnson, Executive Vice President and Chief Financial Officer. On slide two, I'd like to remind you that today's webcast includes forward-looking statements, such as those related to our future financial and operating results, growth potential, and anticipated development regulatory and commercial milestones and goals, which involve risks and uncertainty that could cause actual events, performance, and results to differ materially from those contained in those forward-looking statements. We encourage you to review the statements contained in today's press release in our slide deck and the risks and uncertainties described under the caption risk factors in our annual report on Form 10-K for the fiscal year ended December 31st, 2024, and our subsequent filings with the SEC, including our quarterly report on Form 10-Q for the fiscal quarter ended June 30th, 2025. which identifies certain factors that may cause the company's actual events, performance, and results to differ materially from those contained in the forward-looking statements made on today's webcast. We undertake no duty or obligation to update our forward-looking statements. As noted on slide three, we will discuss non-GAAP financial measures on this webcast. Descriptions of these non-GAAP financial measures and reconciliations of GAAP to non-GAAP financial measures are included in today's press release and the slide presentation available on the Investors section of our website. I'll now turn the call over to Bruce. Thanks, Jack. Good afternoon, everyone. Thank you for joining us today to discuss Jazz's second quarter 2025 results. Starting on slide five, I'd like to congratulate Renee on her unanimous selection by the Jazz Board of Directors as President and CEO. I'm confident Renee is the right leader to build on Jazz's momentum and serve as a catalyst in driving long-term growth. After working with Renee closely for more than five years, I've seen firsthand that she has the right skill set and experience to further drive innovations. while nurturing the culture of purpose and patient impact that is at the center of everything we do at Jazz. Since co-founding Jazz in 2003, I've had the extraordinary privilege of leading the company through its growth and significant diversification that has transformed the business into the fully integrated biopharma company it is today. I'll continue serving as chairman of the board of directors, providing strategic guidance, and look forward to seeing Jazz continue delivering for patients employees, and shareholders. Now, turning to slide six, Jazz continues to demonstrate considerable progress across commercial, R&D, and corporate development. We remain confident in the strength of our diversified portfolio and excited about the potential for future growth as we prepare for the anticipated approval of Dordavacrom and approval of Zebzelka in an earlier line of treatment. We're approaching a significant milestone for Dordavacrone with the upcoming FDA PDUFA target action date of August 18th. We added Dordavacrone to our pipeline through the Chimerix acquisition we closed in April, enhancing our presence in rare oncology. Given its patent protection into 2037, with potential to receive patent term extension and the opportunity for expanded use in the frontline setting, We view Dordaviprone as a meaningful and durable revenue opportunity for JADS. In addition, we have the right capabilities in place to deliver a successful commercial launch and are positioned to initiate key activities immediately upon receiving FDA approval. We remain excited about bringing this first-in-class therapy to patients with H3K27M mutant diffuse glioma who currently have very limited treatment options. Additionally, on the regulatory front, I'm pleased that Zyhera was recently granted conditional marketing authorization by the European Commission for Advanced HER2-Positive Biliary Tract Cancer, or BTC, and we look forward to the upcoming October 7th PDUF target action date for Zebselka in first-line maintenance for extensive-stage small-cell lung cancer. Turning to our commercial business, in the second quarter of 2025, we generated over a billion dollars in total revenue across our portfolio, led by our neuroscience assets. ZyWave grew 13% year over year, with robust net patient ads seen across both narcolepsy and idiopathic hypersomnia, or IH. ZyWave remains the only low-sodium oxidate, the number one branded treatment for narcolepsy as measured by revenue, and the only FDA-approved therapy to treat IH. Epidiolex continues to have strong underlying demand, and we remain confident in its blockbuster potential. While our oncology portfolio is facing near-term headwinds, we remain confident in the outlook for growth driven by multiple near-term catalysts, including the upcoming Dordavacrone-Pedufa for the treatment of recurrent H3K27M mutant diffuse glioma, Zepzelkis potential move into first-line maintenance in extensive stage small cell lung cancer, and the top-line data readout from Xanidatamab's Phase III first-line gastroesophageal adenocarcinoma, or GEA, trial expected late in the fourth quarter of 2025. Turning to our pipeline, at the ASCO annual meeting in June, we presented potentially practice-changing Phase III data for Zepzelka and updated Phase II data, including long-term survival, for Xanidatamab, which demonstrated unprecedented advances in their respective tumor types. Our Xanidatamab clinical development program continues to progress well and enroll patients across our numerous ongoing registrational trials. Additionally, we initiated a new Phase II trial in neoadjuvant and adjuvant HER2-positive breast cancer. With the first half of the year complete, we've revised our financial guidance, including a modest reduction in the midpoint of our revenue guidance, while reductions in SG&A, R&D, and effective tax rate guidance support raising the lower end of our ANI and EPS guide. We generated robust operating cash flow in the first half of the year and remain confident in the overall strength of the business. In summary, we're focused on execution and delivering innovative therapies for patients and their families. Our diversified portfolio, robust pipeline, and disciplined approach to capital allocation position us well for sustainable long-term growth. I'll now turn the call over to Renee to discuss our commercial performance after which Rob will cover our R&D pipeline. Phil will then provide a financial overview and discuss our updated guidance. And after that, we'll open the call to Q&A. Renee?

Thanks, Bruce. I'm thrilled to be stepping into the CEO role to build upon Jazz's incredible success and transformation over the last several years. I'd like to thank the board for their trust and confidence in me and Bruce for his dedicated leadership of Jazz over the past two decades. I believe this company has immense potential and I look forward to continuing the important efforts underway and working with our team to drive greater value for our patients and shareholders. I know there may be questions about potential changes to Jazz's future direction. Right now, my focus is on ensuring a smooth transition into the CEO role. As we shape our next phase of growth, I plan to listen and gather insights from a broad range of internal and external voices And as decisions are made, they will be shared broadly. In the meantime, I appreciate your patience and support, and I look forward to engaging on this topic in the future. Now, I'll begin on slide eight to discuss the progress of our commercial portfolio. Starting with our sleep therapeutic area, total sleep revenue, which includes Zyraib and Zyraim net product sales plus royalties from high-sodium oxibate authorized generics, or AGs, was $505 million in the second quarter of 2025. ZyWave delivered another strong quarter with net product sales increasing 13% year-over-year to approximately $415 million. As the only low-sodium-oxibate therapy, the benefits of ZyWave in reducing sodium intake and individualized dosing continue to resonate with patients and HCPs. This is reflected by the approximately 625 net patient ads across both narcolepsy and IH exiting the second quarter. We continue to focus on strong execution and enabling as many patients as possible to benefit from low sodium thigh waves. Our field teams are generating strong demand with medical science liaisons and a suite of patient services like field nurse educators, working in an integrated fashion to educate HCPs and help patients from their initial diagnosis through titration of ZyWave. We've been particularly pleased with the continued momentum in IH, where we had approximately 400 net patient ads this quarter. Our consumer targeted digital and media campaigns are performing well and building disease awareness and patient education. These initiatives, coupled with our ongoing HCP education around proper diagnosis and identifying appropriate patients who can benefit from ZyWave, are contributing meaningfully to growth in IH, where ZyWave is the only FDA-approved therapy. We were pleased with our robust medical presence at the APSS annual meeting in June, with 24 total presentations, including 19 posters and five oral presentations. These included results from the Phase IV open-label Xylo trial, showing that a switch from high-sodium oxidate to the same dose of low-sodium oxidate was associated with clinically meaningful reductions in blood pressure. Additionally, two presentations from the DUET trial evaluating sleep architecture demonstrated the effectiveness of ZyWave on improvements in sleep quality among patients with IH or narcolepsy. These data presentations continue to strengthen the clinical evidence supporting Zyway's differentiated therapeutic value. Moving to slide nine, underlying demand for Epidiolex remained strong, with second quarter net product sales of approximately $252 million, representing a 2% increase compared to the same quarter in 2024. Year-over-year revenue growth was impacted by a number of factors, including U.S. inventory dynamics. As noted on a prior call, we experienced an earlier than expected build of inventory in the second quarter of 2024, which negatively impacts our current year-over-year growth rate. Based on typical seasonality, we anticipate a gradual build of inventory throughout the second half of this year. Our Epidiolex field teams in the U.S. and Europe are executing well. focusing on the product's unique differentiation, including the robust body of evidence supporting both seizure and non-seizure benefits. The adult segment and long-term care facilities continue to be a focus of growth for Epidiolex. LGS has historically been underdiagnosed in adult patients due to the evolution of symptoms over time. However, the refractory epilepsy screening tool for LGS is helping some providers to more readily identify adult patients living with LGS. With our ongoing momentum, we continue to expect Epidiolex to reach blockbuster status this year. Moving to oncology on slide 10. Rylase net product sales were approximately $101 million in the second quarter of 2025, a decrease of 7% year over year. Updates to Children's Oncology Group pediatric ALL treatment protocol that impacted the timing of asparaginase administration. which were first recommended a year ago, have been broadly adopted. Although claims data indicate that pediatric asparaginase use as a class remains below pre-protocol implementation levels, Rylase use in pediatric ALL patients relative to the asparaginase class as a whole has remained broadly stable. We are focused on continuing efforts to ensure switching to Rylase at the first sign of hypersensitivity reaction and expanding our presence in the adolescent and young adult market. We view these as the greatest opportunities for Riley's growth. On slide 11, Zepselka net product sales for the second quarter of 2025 were approximately $75 million, a decrease of 8% year over year. While we have seen increased competition in the second line small cell lung cancer setting, Zepselka continues to be a highly prescribed treatment for patients. Of note, the adoption of immunotherapy in first-line limited-stage small-cell lung cancer is improving PFS and delaying the progression of patients into the second-line setting, thereby reducing the number of patients available for second-line treatment. Importantly, we believe the Inforte data presented at ASCO will set a new treatment standard for extensive-stage small-cell lung cancer patients in the first-line maintenance setting. Our SNDA has been granted priority review with the PDUFA target action date of October 7, 2025, and we have submitted the data for potential inclusion in NCCN guidelines, which is generally a path for broader uptake and reimbursement. This potential to move into first-line maintenance therapy represents an important opportunity to enable patients to benefit from ZEPS-ELCA earlier in their treatment and represents an opportunity to redefine the treatment paradigm in first-line extensive stage small cell lung cancer. Moving to slide 12 in Zyhera, we recognized approximately $6 million of net product sales in the second quarter of 2025, which given the patient population in BTC, is aligned to our expectations at this early stage of launch. We are receiving feedback from oncologists that continues to confirm the real-world clinical profile at benefit matches what was observed in clinical trials. We're pleased with this positive feedback as HCPs gain experience and confidence with prescribing Zyhera. As we look ahead to GEA, we would anticipate rapid NCCN guideline inclusion if data are positive and strong clinical adoption following potential regulatory approval. We believe ZANI DataMap has the potential to be the HER2-targeted agent of choice Finally, we were pleased the European Commission granted conditional marketing authorization for Second Line HER2-positive BTC in June, and we are initiating the rolling launch across Europe. I'll now turn it over to Rob for an update on our pipeline and upcoming milestones. Rob?