Arrowhead Pharmaceuticals Inc (ARWR) Q2 2025 Earnings Call Highlights: Strong Financials and ...

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Tue, May 13, 2025, 1:07 AM 4 min read

Net Income: $370.4 million or $2.75 per share for the quarter ended March 31, 2025.
Revenue: $542.7 million for the quarter ended March 31, 2025.
Operating Expenses: $161.5 million for the quarter ended March 31, 2025.
Cash and Investments: $1.1 billion as of March 31, 2025.
Common Shares Outstanding: 138.1 million as of March 31, 2025.
Cash Flow from Operating Activities: $460.1 million provided during the quarter ended March 31, 2025.
Sarepta Agreement Revenue Recognition: $542.7 million recognized during the quarter ended March 31, 2025.
Future Revenue Guidance: $90 million to $125 million expected over the next 12 months from initial fixed contract revenue.

Warning! GuruFocus has detected 5 Warning Signs with ARWR.

Release Date: May 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) is on track to launch its first commercial product, plozasiran, this year, pending regulatory approval.
The company has a strong financial position, with $1.1 billion in cash and investments, and is funded into 2028.
Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) has a robust pipeline with multiple Phase III studies and potential launches in the coming years.
The company has secured a significant partnership with Sarepta Therapeutics, bringing in $500 million upfront and additional potential milestones.
Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) is making progress in expanding its RNAi technology to new areas, including CNS and obesity treatments.

Negative Points

The biotech market remains uncertain, which could impact future funding and partnerships.
Regulatory approval for plozasiran is still pending, with a PDUFA date set for November 18, 2025.
There is competition in the triglyceride-lowering market, which could impact the commercial success of plozasiran.
The company faces challenges in patient identification and market education for its rare disease treatments.
Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) has not yet finalized its commercialization strategy for plozasiran outside the U.S., which could delay international market entry.

Q & A Highlights

Q: For INHIBNY and ALK7, how are you setting expectations for initial monotherapy and potential combo data, including changes on weight loss, body composition, and relevant biomarkers? A: James Hamilton, Chief of Discovery and Translational Medicine, stated that they are not providing guidance on expectations as this is a first-in-human study. The animal data were compelling, showing good weight loss both as a monotherapy and in combination with tirzepatide. They are particularly interested in the quality of weight loss, such as the loss of visceral fat and retention of lean muscle mass, which was observed in animal models. Initial data is expected towards the end of the year.

Q: Ahead of the plozasiran FDA review decision, how do you think about the robustness of your pancreatitis data and potential label differentiation? A: Bruce Given, Chief Operating Officer and Head of Research and Development, mentioned that they haven't had labeling negotiations with the FDA yet. They are confident in their data, which focused on confirmed pancreatitis using the AtLAA criteria, unlike Ionis, which included possible and probable cases. The focus is on achieving low triglyceride levels, which correlates with reduced pancreatitis risk.

Q: For plozasiran in SHTG, what is the expected baseline rate of acute pancreatitis in your population for SHASTA-3 and 4, and what magnitude of effect do you expect to show? A: Christopher Anzalone, President and CEO, explained that they expect to replicate Phase II results, with mean triglycerides around 850 to 900 and a placebo-adjusted change of 53% reduction. For the pancreatitis study, the baseline might be closer to the PALISADE study, around 2,000, as patients with a history of pancreatitis are more susceptible even at lower triglyceride levels.

Q: How are you thinking about advancing both ARO-ALK7 and ARO-INHBE through clinical development, and do you have interest or capacity to advance both? A: James Hamilton stated that both programs are being advanced through Phase I to assess safety, PD, and efficacy data. ARO-INHBE uses the well-vetted GalNAc technology, while ARO-ALK7 uses a new platform. They plan to choose one to move forward after reviewing the data, with potential for partnership opportunities.

Q: How are you thinking about commercialization of plozasiran ex-U.S.? Are you planning to do that by yourself or looking for a partner? A: Christopher Anzalone mentioned that they are preparing for commercialization in Europe and are open to finding partners. They believe the European markets, particularly the large four European markets and the U.K., are well-suited for commercialization of a rare disease like FCS, with limited infrastructure and resources needed to reach centers of excellence.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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