Vertex(VRTX) - 2025 Q1 - Quarterly Results

Financial Performance First Quarter 2025 Financial Results Vertex reported a 3% increase in total revenue to $2.77 billion for Q1 2025, with GAAP Net Income decreasing to $646 million from $1.1 billion due to a $379 million impairment charge and increased operating expenses Q1 2025 Financial Highlights | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $2.77 billion | $2.69 billion | +3% | | U.S. Revenue | $1.66 billion | - | +9% | | International Revenue | $1.11 billion | - | -5% | | GAAP Net Income | $646 million | $1.1 billion | -41% | | Non-GAAP Net Income | $1.1 billion | $1.2 billion | -8% | | Cash & Marketable Securities | $11.4 billion | - | - | - A significant intangible asset impairment charge of $379.0 million was recorded related to the discontinued VX-264 program for type 1 diabetes, impacting GAAP operating income[6] - Combined GAAP R&D, Acquired IPR&D, and SG&A expenses increased to $1.4 billion from $1.2 billion in Q1 2024, driven by investments in late-stage clinical programs and the commercial launch of JOURNAVX[5] Full Year 2025 Financial Guidance Vertex raised the lower end of its full-year 2025 revenue guidance by $100 million to a new range of $11.85 billion to $12.0 billion, while operating expense and tax rate guidance remains unchanged FY 2025 Financial Guidance Update | Guidance Metric | Current FY 2025 | Previous FY 2025 | | :--- | :--- | :--- | | Total Revenue | $11.85 billion to $12.0 billion | $11.75 billion to $12.0 billion | | Combined GAAP R&D, AIPR&D and SG&A Expenses | Unchanged ($5.55 billion to $5.7 billion) | $5.55 billion to $5.7 billion | | Combined Non-GAAP R&D, AIPR&D and SG&A Expenses | Unchanged ($4.9 billion to $5.0 billion) | $4.9 billion to $5.0 billion | | Non-GAAP Effective Tax Rate | Unchanged (20.5% to 21.5%) | 20.5% to 21.5% | - The updated revenue guidance reflects continued growth in the Cystic Fibrosis franchise, uptake of CASGEVY, and early contributions from the launch of JOURNAVX[9] Business and Pipeline Highlights Marketed Products Update Vertex is seeing strong commercial momentum across its portfolio, with continued growth in the Cystic Fibrosis franchise, expanding global launch of CASGEVY, and rapid initial uptake of JOURNAVX - Cystic Fibrosis (CF): ALYFTREK, the new once-daily CFTR modulator, is now approved in the U.S. and U.K., with a positive CHMP opinion in Europe potentially leading to H2 2025 approval, and the KAFTRIO label expanded in the EU to include patients aged 2 and older[12][14] - CASGEVY (SCD/TDT): The global launch is expanding with reimbursement secured in England, Wales, Austria, and parts of the UAE, over 65 authorized treatment centers active, and approximately 90 patients starting treatment as of May 1st[13][15] - JOURNAVX (Acute Pain): Following its U.S. launch in March, over 20,000 prescriptions have been filled, with payer coverage rapidly expanding to 94 million lives covered and 42 million having unrestricted access as of May 1st[18] Select Clinical-Stage R&D Pipeline Vertex's R&D pipeline is advancing with four programs in pivotal development, including povetacicept and zimislecel, both on track for potential 2026 filings, spanning multiple diseases with several studies expected to start or report data in 2025 - The company has four programs in pivotal development, with plans to start a fifth pivotal study for povetacicept in primary membranous nephropathy (pMN) this year[2] - Key programs are on track for potential regulatory filings in 2026, including povetacicept for IgAN and zimislecel for Type 1 Diabetes[2][26][27] Cystic Fibrosis (CF) Pipeline - Phase 3 studies are ongoing to expand labels for TRIKAFTA/KAFTRIO (1-2 year olds) and ALYFTREK (2-5 year olds)[18] - The next-generation, once-daily combination therapy VX-828 is expected to enter clinical trials in people with CF this year[19] - The Phase 1/2 study of VX-522, an mRNA therapy, is temporarily paused to assess a tolerability issue observed in the multiple ascending dose portion[19] Pain Portfolio (Acute and Neuropathic) - Acute Pain: A Phase 2 study of an oral formulation of the next-generation NaV1.8 inhibitor, VX-993, is expected to complete this quarter, with results anticipated in H2 2025[21][24] - Neuropathic Pain: A Phase 3 pivotal trial of suzetrigine (the active ingredient in JOURNAVX) for diabetic peripheral neuropathy (DPN) is currently enrolling patients[22][24] Type 1 Diabetes (T1D) - Enrollment and dosing for the pivotal Phase 3 study of zimislecel (VX-880) are expected to be completed in Q2 2025, with marketing applications planned for 2026[23][26] - Development of the VX-264 "cells plus device" program has been discontinued as it did not meet its efficacy endpoint[26] Kidney Diseases - IgAN & pMN: The Phase 3 interim analysis cohort for povetacicept in IgA nephropathy (IgAN) is fully enrolled, with a potential accelerated approval filing in H1 2026, and a pivotal Phase 2/3 trial in primary membranous nephropathy (pMN) will begin this year[25][27][31] - AMKD: Enrollment for the interim analysis cohort of the Phase 3 AMPLITUDE trial of inaxaplin is expected to complete in H2 2025[28][31] - ADPKD: Following a completed Phase 1 study, VX-407 will advance into a Phase 2 proof-of-concept study this year in a subset of ADPKD patients[30][32] Myotonic Dystrophy Type 1 (DM1) - The company continues to enroll and dose patients in the multiple ascending dose (MAD) portion of the Phase 1/2 trial of VX-670, which will assess both safety and efficacy[29] Financial Statements Consolidated Statements of Income The income statement for the three months ended March 31, 2025, shows total revenues of $2.77 billion and a GAAP net income of $646.3 million, or $2.49 per diluted share, compared to $1.1 billion, or $4.21 per diluted share, in Q1 2024 Consolidated Statements of Income (in millions, except per share) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total revenues | $2,770.2 million | $2,690.6 million | | Total costs and expenses | $2,140.1 million | $1,551.1 million | | Income from operations | $630.1 million | $1,139.5 million | | Net income | $646.3 million | $1,099.6 million | | Diluted net income per common share | $2.49 | $4.21 | Total Revenues Breakdown Revenue for Q1 2025 was primarily driven by TRIKAFTA/KAFTRIO, which generated $2.54 billion, with newly launched ALYFTREK contributing $53.9 million and other product revenues totaling $170.8 million Total Revenues by Product (in millions) | Product | Q1 2025 Revenue (millions) | Q1 2024 Revenue (millions) | | :--- | :--- | :--- | | TRIKAFTA/KAFTRIO | $2,535.5 | $2,483.6 | | ALYFTREK | $53.9 | $— | | Other product revenues | $170.8 | $207.0 | | Total revenues | $2,770.2 | $2,690.6 | - In Q1 2025, "Other product revenues" included $14.2 million from CASGEVY[40] Reconciliation of GAAP to Non-GAAP Financial Information Vertex provides a reconciliation of GAAP to Non-GAAP results, adjusting for items like stock-based compensation and impairment, with Q1 2025 Non-GAAP operating income at $1.18 billion and net income at $1.05 billion GAAP to Non-GAAP Reconciliation (in millions, except per share) | Metric | Q1 2025 GAAP | Q1 2025 Non-GAAP | Q1 2024 GAAP | Q1 2024 Non-GAAP | | :--- | :--- | :--- | :--- | :--- | | Operating Income (millions) | $630.1 | $1,183.0 | $1,139.5 | $1,336.3 | | Net Income (millions) | $646.3 | $1,054.1 | $1,099.6 | $1,241.8 | | Diluted EPS | $2.49 | $4.06 | $4.21 | $4.76 | - Major adjustments from GAAP to Non-GAAP pre-tax income in Q1 2025 included a $379.0 million intangible asset impairment charge and $166.1 million in stock-based compensation expense[45] Condensed Consolidated Balance Sheets As of March 31, 2025, Vertex held $11.4 billion in cash, cash equivalents, and marketable securities, with total assets at $22.88 billion and total shareholders' equity at $16.50 billion Condensed Consolidated Balance Sheets (in millions) | Metric | March 31, 2025 (millions) | December 31, 2024 (millions) | | :--- | :--- | :--- | | Cash, cash equivalents and marketable securities | $11,357.7 | $11,223.8 | | Total current assets | $10,008.8 | $9,596.4 | | Total assets | $22,880.5 | $22,533.2 | | Total current liabilities | $3,783.2 | $3,564.6 | | Total liabilities and shareholders' equity | $22,880.5 | $22,533.2 |