Regeneron Pharmaceuticals, Inc.

Welcome to the Regeneron Pharmaceuticals Q2 2019 Earnings Conference Call. My name is John, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. During the question-and-answer session, if you do have a question, press star then 1 on your touch-tone phone. Please note the conference is being recorded. And I will now turn the call over to Justin Holko.

Thank you, John. Good morning. Good afternoon and good evening to everyone listening around the world. Thank you for your interest in Regeneron Pharmaceuticals and welcome to the second quarter 2019 conference call. An archive of this webcast will be available on our website. Joining me today are Dr. Leonard Schleifer, Founder, President and Chief Executive Officer, Dr. George Yancopoulos, Founding Scientist, President and Chief Scientific Officer, Marion McCord, Senior Vice President and Head of Commercial, and Bob Landry, Executive Vice President and Chief Financial Officer. After our prepared remarks, we will open the call for Q&A. I would also like to remind you that our remarks made on the call today include forward-looking statements about Regeneron. Such statements may include but are not limited to those related to Regeneron and its products and businesses, financial forecasts and guidance, development programs and related anticipated milestones, collaborations, finances, regulatory matters, payer coverage and reimbursement issues, intellectual property, and pending litigation and competition. Each forward-looking statement is subject to risks and uncertainties that could cause actual results and events to differ materially from those projected in that statement. A more complete description of these and other material risks can be found in Regeneron's filings with the United States Securities and Exchange Commission, including its Form 10-Q for the quarterly period ended June 30, 2019, which has been filed with the SEC today. Regeneron does not undertake any obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. In addition, Please note that GAAP and non-GAAP measures will be discussed on today's call. Information regarding our use of non-GAAP financial measures and the reconciliation of those measures to GAAP is available in our financial results press release, which can be accessed on our website. Once our call concludes, Bob Landry and the IR team will be available to answer further questions. With that, let me turn the call over to our President and Chief Executive Officer, Dr. Len Schleifer. Thank you, Justin.

Before we begin, I'd like to extend a warm welcome to Justin, who joined us earlier this summer after completing a 19-year training program at Merck and has immediately hit the ground running here at Regeneron. We're thrilled to have him as part of the team, and we worked hard to make his first quarter a straightforward one. Thanks to everyone for joining the call and turning to our business. We had a great quarter, actually, marked by top and bottom line growth as well as important advances across our innovative R&D engine. Sales of Regeneron products, including those recorded by our partners, grew 32% compared to the second quarter of 2018. ILEA global net sales grew 13% to $1.9 billion, including U.S. ILEA net sales growth of 17% to $1.16 billion. The diabetic retinopathy approval in May continues to build upon ILEA's leadership position in treating retinal diseases, including wet age-related macular degeneration, diabetic macular edema, and retinal vein occlusion. We are also pleased to announce that our antibody collaboration with Sanofi achieved profitability this quarter. We expect profits to continue to increase, driven by growth in dupixin, as well as disciplined cost management across the collaboration to stem losses from Pryor by better aligning investments with revenues. Depiction is fulfilling its potential to improve the lives of patients by transforming the treatment of a variety of type 2 allergic diseases. Global net sales are now annualizing at more than $2 billion. Patient initiations in the U.S. are growing, and many ex-US launches are just beginning. Building on this commercial momentum, in June we received FDA approval for Dupixent in chronic rhinosinusitis with nasal polyposis. In the EU, Dupixent was approved in May for severe asthma in adults and adolescents, and as we announced this morning, was just approved for atopic dermatitis in adolescent patients. We also announced today the strong positive results of our Phase III study in children aged 6 to 11 with severe atopic dermatitis. We are enthusiastic about the current and future prospects for Depixin as a treatment directed at the underlying cause of allergic diseases. Additionally, we are making significant progress towards our goal of building a leading presence in immuno-oncology, The U.S. and EU approvals for libtio and advanced cutaneous squamous cell carcinoma are just the beginning. Our clinical efforts, which now include multiple different immuno-oncology programs, are studying a wide variety of potential drug candidates in several difficult-to-treat cancers, including non-small-cell lung cancer, basal cell carcinoma, cervical cancer, ovarian cancer, non-Hodgkin's lymphoma, multiple myeloma, and prostate cancer. Beyond oncology, we continue to move novel programs forward throughout early and late stage development. George will speak to a few of these programs, and additional data readouts are expected later this year. We've made critical advances that have led both to top-line and bottom-line growth, but we recognize that these advances may be overshadowed by the current policy debates on the affordability and accessibility of innovative medicine. We continue to work with policymakers to develop responsible solutions that address affordability and accessibility while preserving incentives to develop transformative treatments of the future. Now I'll turn the call over to George.