Insmed (INSM) Lags on Q2 Earnings, Tops Sales, Reiterates View

Core Viewpoint - Insmed reported a wider loss per share in Q2 2024 compared to estimates, despite a year-over-year revenue increase driven by its only marketed drug, Arikayce [1][2][3] Financial Performance - Insmed's Q2 2024 loss per share was $1.94, exceeding the Zacks Consensus Estimate of a loss of $1.22, and wider than the previous year's loss of $1.78 [1] - Total revenues for the quarter reached $90.3 million, marking a 17% increase year-over-year, and surpassing the Zacks Consensus Estimate of $88.0 million [1] - Arikayce sales contributed entirely to the revenue, with U.S. sales up 11% to $63.8 million, Japan sales up 35% to $21.1 million, and sales in Europe and the rest of the world up 37% to $5.4 million [2][3] Expenses - Selling, general and administrative (SG&A) expenses rose 26% year-over-year to $106.6 million, primarily due to increased compensation and benefits [4] - Research and development (R&D) expenses decreased by 25% to $146.7 million compared to the previous year, attributed to a non-cash cost recognized in the prior period [4] Cash Position - As of June 30, 2024, Insmed's cash, cash equivalents, and marketable securities totaled $1.2 billion, a significant increase from $595.7 million on March 31, 2024, due to a secondary stock issue that generated net proceeds of $713.2 million [5] Guidance - Management maintained its sales guidance for Arikayce, projecting product sales between $340 million and $360 million for 2024, indicating a 15% year-over-year growth at the midpoint [6] Recent Developments - Insmed aligned with the FDA on the primary endpoint of the phase III ENCORE study for Arikayce, with top-line data expected in Q1 2026 [7] - Positive top-line data from the phase III ASPEN study for brensocatib indicated significant reductions in pulmonary exacerbations, with a regulatory filing expected in Q4 2024 [8] - If approved, brensocatib could be the first treatment for bronchiectasis, with a U.S. launch anticipated in mid-2025 and potential for blockbuster sales [9] - Upcoming data from a mid-stage study on treprostinil palmitil inhalation powder (TPIP) is expected in H2 2025, with plans for a late-stage study next year [10]