Financial Data and Key Metrics Changes - Revenue for the second quarter was $1.6 billion, down 1% at constant currency, primarily due to the loss of exclusivity of Adazet in the EU [6][21] - Adjusted EBITDA for the quarter was $522 million, representing a 32.7% margin, with year-to-date adjusted EBITDA at $1 billion or a 32.4% margin [6][7] - The company is raising its revenue guidance range by $100 million at the midpoint due to favorable operational performance [6][34] Business Line Data and Key Metrics Changes - Women's health franchise grew 2% at constant currency, with the fertility business growing 15% driven by increased demand [9][10] - Sales of Nexplanon declined 1% at constant currency in the second quarter, with a 5% decline in the U.S. but a 10% growth outside the U.S. [11][12] - Biosimilars, particularly HEDLEMA, performed better than expected, generating nearly $100 million, up 68% year-over-year [14][15] Market Data and Key Metrics Changes - The U.S. market for Nexplanon is facing funding constraints from federal and state programs, impacting purchasing decisions [12][51] - Pricing pressure was noted primarily from the loss of exclusivity of Adazet and certain mature products in the U.S. [22] - Volume increased by $90 million in the quarter, representing a growth of about 5.6% [23] Company Strategy and Development Direction - The company is focused on reducing its debt burden, having repaid approximately $350 million of principal on long-term debt instruments [8][9] - A strong emphasis on EBITDA generation is aimed at delivering over $900 million of free cash flow before one-time costs in 2025 [7][8] - The company is committed to building Nexplanon into a billion-dollar franchise, reflecting confidence in its long-term growth potential [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving revenue growth despite challenges from the loss of exclusivity of Adazet [19][40] - The company anticipates continued global growth for Nexplanon, with a five-year indication submission to the FDA expected to enhance market potential [13][54] - Management highlighted the importance of VITAMMA as a growth catalyst and expects significant progress in access objectives [20][19] Other Important Information - The adjusted gross margin for the second quarter was 61.7%, slightly down from 62% in 2024, primarily due to pricing pressures [25] - The company expects total operating expenses to be generally flat with the prior year, aiming for $200 million of operational savings in 2025 [26][30] - The company is on track to achieve a net leverage ratio below four times by year-end 2025 [9][41] Q&A Session Summary Question: Can you talk about incremental sales and marketing investment for VITAMMA? - Management confirmed the start of new telehealth and DTC campaigns and an increase in sales force to support VITAMMA [44][45] Question: Can you elaborate on the federal funding headwinds for Nexplanon? - Management indicated that the decline in U.S. Nexplanon sales was due to a combination of purchase timing and underlying market pressures, but expressed confidence in growth moving forward [50][54] Question: What impact might tariffs have on margins in 2026? - Management stated it is too early to speculate on tariff impacts for 2026, but noted that the EU is the largest import exposure for the company [58] Question: How should we think about free cash flow conversion and one-time items? - Management expects free cash flow to grow in line with the business, with a continued reduction in one-time costs [61] Question: What is the status of the 6219 endometriosis program? - Management confirmed the discontinuation of the program due to lack of efficacy signals [86] Question: Will the FDA update the real-time release study for Nexplanon? - Management is working closely with the FDA for appropriate labeling for the five-year indication but did not comment on specific FDA decisions [87]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $1.6 billion, down 1% at constant currency, primarily due to the loss of exclusivity of Adazet in the EU [5][20] - Adjusted EBITDA for the quarter was $522 million, representing a 32.7% margin, with year-to-date adjusted EBITDA at $1 billion or 32.4% margin [5][6] - The company is raising its revenue guidance by $100 million at the midpoint for the full year based on year-to-date performance and foreign currency movements [5][33] Business Line Data and Key Metrics Changes - Women's health franchise grew 2% at constant currency, with the fertility business growing 15% in Q2 2025 [7][8] - Sales of Nexplanon declined 1% at constant currency in Q2, with a 5% decline in the U.S. but a 10% growth outside the U.S. [10][11] - Biosimilars, particularly HEDLEMA, performed better than expected, generating nearly $100 million, up 68% year-over-year [12][13] Market Data and Key Metrics Changes - The U.S. market for Nexplanon is facing funding constraints from federal and state programs, impacting purchasing decisions [10][11] - Pricing pressure was noted primarily from the loss of exclusivity of Adazet and certain mature products in the U.S. [21][22] - Volume increased by $90 million in Q2, representing a growth of about 5.6%, driven by fertility, HEDLEMA, Emgality, and VITAMMA [22] Company Strategy and Development Direction - The company is focused on reducing its debt burden, having repaid approximately $350 million of long-term debt in Q2 [6][31] - Aiming for a net leverage ratio below four times by year-end and further improvements to 3.5 times or below by 2026 [6][31] - The company is committed to building Nexplanon into a billion-dollar franchise and expanding its market presence [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving free cash flow of over $900 million before one-time costs in 2025 [6][41] - The company is optimistic about the growth potential of VITAMMA and expects to achieve significant access improvements by early 2026 [15][18] - Management acknowledged challenges in the U.S. market due to federal funding issues but remains confident in Nexplanon's long-term growth potential [11][53] Other Important Information - The company expects to see a modest decline in adjusted gross margin in the second half of the year but aims to land closer to the high end of the 60% to 61% range [36][39] - One-time costs related to restructuring are expected to decline, improving free cash flow conversion in the coming years [60][61] Q&A Session Summary Question: Can you talk about incremental sales and marketing investment for VITAMMA? - The company has started new telehealth and DTC campaigns and added more sales representatives, totaling over 125 in the field [44][45] Question: Can you elaborate on the federal funding headwinds for Nexplanon? - The decline in U.S. Nexplanon sales is attributed to both purchase timing and underlying pressures, with confidence in growth despite market confusion [48][52] Question: What is the expected impact of tariffs on margins in 2026? - It is too early to speculate on tariff impacts for 2026, but the EU is the largest import exposure for the company [56][57] Question: How should we think about free cash flow conversion and one-time items? - Free cash flow should grow in line with the business, with a continued reduction in one-time costs expected [60][61] Question: What is the status of the 6219 endometriosis program? - The company has decided to discontinue the program due to lack of efficacy signals [80][82] Question: Will the FDA update the guidance for generics regarding Nexplanon? - The company is working closely with the FDA for the new labeling for the five-year indication, but the FDA will make its own assessment [82][86]