Release Date: July 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Ipsen SA (IPSEF, Financial) reported a strong financial performance with total sales growth of 9.5% in the first half of the year.
- The company achieved a core operating margin of 32.4%, reflecting efficient cost management.
- Ipsen SA (IPSEF) generated free cash flow of EUR394 million, indicating strong cash generation capabilities.
- Regulatory successes included FDA approvals for Onivyde in first-line pancreatic cancer and Iqirvo in second-line PBC.
- The company expanded its pipeline with in-licensing of ex-US rights to savolitinib in pediatric oncology and executed multiple early-stage transactions in oncology and neuroscience.
Negative Points
- Somatuline sales in North America fell by 6.3% due to adverse US pricing, and a sharp decline is anticipated in the second half due to increased generic penetration.
- The gross margin decreased by 1.6 points, driven by an unfavorable sales mix and higher royalty payments.
- R&D costs increased by 11%, impacting the overall profitability despite strong sales growth.
- The company faces potential challenges with the erosion of Somatuline sales due to generic competition, particularly in the US.
- There is uncertainty regarding the impact of potential market changes, such as the removal of Ocaliva, which could affect Iqirvo's market dynamics.
Q & A Highlights
Q: Can you provide insights on the expected erosion of Somatuline sales in the second half of the year and how it factors into the 2024 guidance?
A: David Loew, CEO, explained that they anticipate an acceleration of Somatuline erosion due to increased generic competition, particularly in the US. This expectation is already factored into their 2024 guidance, assuming supply recovery in Europe and stronger erosion in the US.
Q: What is the potential impact of Ocaliva's market removal on Iqirvo's opportunity in second-line PBC?
A: David Loew noted that if Ocaliva is removed without a compassionate use program, it could accelerate Iqirvo's penetration. The current guidance already assumes some cannibalization of Ocaliva, but a complete removal could present an upside.
Q: Are there any concerns about Dysport's performance in the US, and how does it relate to the broader aesthetics market?
A: Aymeric le Chatelier, CFO, clarified that Dysport's quarterly performance can be affected by shipment phasing. Despite a softer US market, Dysport showed strong growth in the first half, and they expect continued performance in the second half.
Q: Could you provide an update on the patent dispute regarding Onivyde?
A: David Loew stated that patent disputes typically take a long time to resolve. Ipsen is confident in the stability of their patents, but no immediate updates are expected.
Q: How does Ipsen view the sales potential for tovorafenib in Europe, and what is the confidence level in securing approval?
A: David Loew expressed confidence in the data supporting tovorafenib's approval in Europe. They are working on CMC data for filing next year and anticipate a couple of hundred million in sales potential, although official guidance is not yet provided.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
