Regeneron Pharmaceuticals, Inc.

Welcome to the Regeneron Pharmaceuticals first quarter 2022 earnings conference call. My name is Gigi, 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. Please note that this conference is being recorded. I will now turn the call over to Ryan Crowe, Vice President, Investor Relations. You may begin.

Thank you, Gigi. Good morning, good afternoon, and good evening to everyone listening around the globe. Thank you for your interest in Regeneron, and welcome to our first quarter 2022 earnings conference call. An archive of this webcast will be available on our investor relations website shortly after the call ends. Joining me today are Dr. Leonard Schleifer, founder, president, and chief executive officer, Dr. George Yancopoulos, co-founder, president, and chief scientific officer, Mary McCourt, executive 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'd also like to remind you that remarks made on this 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 forecasting guidance, development programs, and related anticipated milestones, collaborations, finances, regulatory matters, payer coverage and reimbursement issues, intellectual property, pending litigation and other proceedings, 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 10Q for the quarterly period ended March 31st, 2022, which was filed with the SEC this morning. Regeneron does not undertake any obligation to update 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 in today's call. Information regarding our use of non-GAAP financial measures and the reconciliation of those measures to GAAP is available on 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 any further questions. This earnings call is neither an offer to purchase nor a solicitation of an offer to sell securities of Checkmate Pharmaceuticals, Inc. In connection with the tender offer for Checkmate stock, Regeneron and Scandinavian Acquisition Sub Inc. filed with the SEC and tender offer statement on Schedule TO and other tender offer materials and Checkmate filed a solicitation recommendation statement on Schedule 14D9 with the SEC. Copies of the documents filed with the SEC by Regeneron and Checkmate are available free of charge on Regeneron's website at investor.regeneron.com or on Checkmate's website at ir.checkmatepharma.com as applicable or at the SEC's website at www.sec.gov. You should review such materials filed with the SEC carefully because they contain or will contain important information about the tender offer for checkmate stocks that holders of checkmate securities and other investors should consider before making any decision with respect to the tender offer. With that, let me turn the call over to our President and Chief Executive Officer, Dr. Glenn Schleifer. Glenn? Thank you, Ryan. Welcome to your first earnings call.

Thank you. I hope all of our stakeholders will and giving you a warm welcome to the Regeneron team. Thanks to everyone joining the call as well. Following an exceptional 2021, Regeneron is off to a strong start in 2022. Our first quarter results were driven by execution across the entire company as we continue to realize the benefits of our sustained investment in differentiated research and development along with our focus on commercial performance. We also continue to drive shareholder value through proven capital allocation, including approximately $350 million of share repurchases in the first three months of this year. Regarding our financial performance, we delivered strong double-digit revenue and non-GAAP earnings per share growth, excluding revenue contributions from our investigation of COVID antibody cocktails, revenues grew 25%, reflecting our increasingly diversified core business, which continues to thrive. For ILEA, global net sales grew 11% to nearly $2.4 billion in the first quarter, including $1.5 billion of revenues in the United States, up 13% versus last year, which outpaced the U.S. NIVGF category growth. In yet another milestone for ILEA, after more than 10 years, we recently surpassed 50 million ILIA injections globally, a testament to its well-established efficacy and safety profile. We believe ILIA continues to represent a significant long-term growth opportunity, primarily driven by an aging population, increasing utilization among a rapidly growing diabetic population, as well as the potential for investigational flevis at 8 milligrams to complement and enhance our retinal franchise. For depiction in quarter one, global revenues for the quarter exceeded $1.8 billion, an increase of 43% to last year, as we continue to redefine the treatment of type 2 inflammatory diseases. A significant opportunity remains to reach even more patients in already approved indications, and we look forward to potentially launching Dupixin and several new indications in the U.S. later this year and in early 2023, including pediatric atopic dermatitis, eosinophilic esophagitis, and perigo nodularis. Collectively, approximately 200,000 U.S. patients are suffering from these three indications today, but currently have no FDA-approved systemic treatment options. In oncology, LIBTIO continues to capture significant share in FDA-approved non-melanoma skin cancer indications, where it is considered the standard of care. Beyond dramatic oncology, we're beginning to generate momentum in monotherapy, non-small-cell lung cancer in the United States, helping to build a foundation for potential launch of LIBTIO plus chemotherapy later this year, which would allow LIBTIO to address a much larger population of non-small cell lung cancer patients. As we've said before, we continue to consider Liptio to be foundational to our immuno-oncology development strategy and expected to serve as the backbone for our investigation of clinical program in combination with various antibodies, bispecifics, and co-stimulatory bispecifics in our pipeline, as well as other pipeline candidates, including those from our collaborations. In April, we announced our agreement to acquire Checkmate Pharmaceuticals, Regeneron's first-ever acquisition of a company. Upon closing, we expect Checkmate's differentiated T-Tol Receptin-9 agonist, V-Dutolinod, will add a promising new modality to Regeneron's pipeline of potential approaches for difficult to treat cancers. Looking ahead, we remain on track for the second half of this year to share data in difficult-to-treat solid tumors such as ovarian and prostate cancers, to submit a BLA for ozonextamab, a potentially best-in-class CB20 by CD3 bispecific for refractory B-cell lymphomas, and to advance Regeneron 5458, our BCMA by CD3 bispecific. Finally, regarding our ongoing COVID-19 response, Regeneron remains committed to combating the virus as we head toward the likely endemic stage. We firmly believe that monoclonal antibodies will continue to play an important role, particularly to protect immunocompromised individuals who do not respond adequately to COVID-19 vaccines, as well as to treat infected patients whom an oral antiviral therapy is not well tolerated or might trigger serious drug-drug interactions. We are progressing next generation antibodies that are designed to be active against multiple variants, including those of Omicron lineage, and initiated a first-in-human study last month. Concurrently, as the FDA continues their review of our Regenco BLA for COVID-19 treatment and prophylaxis, we are working closely and collaboratively with them and other global regulatory authorities to establish clinical and regulatory pathways to bring additional safe and effective monoclonal treatment options to patients as quickly as possible. In closing, we are excited about the strong commercial momentum for our inline portfolio and the progress we have made advancing our pipeline so far this year. For the remainder of 2022, we anticipate up to eight additional U.S. and EU regulatory approvals, up to four additional U.S. or EU regulatory filings, pivotal data for FLPS at 8 milligrams, as well as various other data readouts from other pipeline programs, which George will discuss. We remain confident in the long-term outlook for our business, and our pipeline continues to be highly productive, and we are in a strong financial position, all of which positions we generate to deliver sustainable growth and long-term value creation. Now, I will turn the call over to George.