Apellis Pharmaceuticals (NasdaqGS:APLS) FY 2025 Conference December 02, 2025 02:30 PM ET Company ParticipantsCedric Francois - CEOTim Sullivan - CFOConference Call ParticipantsYigal Nochomovitz - AnalystYigal NochomovitzOkay. Ready to go. All right. So, Apellis, welcome. Great to see you. So, of course, we have Cedric Francois, CEO and also the co-founder and president of the company, and Tim Sullivan, CFO. So, welcome for those listening on the webcast and then in person. I'm Yigal Nochomovitz, biotech ana ...

Core Insights - Apellis is in a strong position with a foundational technology targeting the complement cascade, specifically C3, which is believed to optimally control complement dysregulation [2] - The company has achieved three drug approvals in approximately 3 to 3.5 years, indicating a robust pipeline and growth potential [2] Drug Approvals - The first approval was for EMPAVELI, targeting paroxysmal nocturnal hemoglobinuria [3] - The second approval was for SYFOVRE, which addresses geographic atrophy, received about 2.5 years ago [3] - Recently, EMPAVELI received a second approval for C3G and IC-MPGN, bringing the total indications to four [3]

Core Insights - Apellis Pharmaceuticals, Inc. reported a revenue of $458.58 million for the quarter ended September 2025, marking a year-over-year increase of 133% [1] - The earnings per share (EPS) for the same period was $1.67, a significant improvement from -$0.46 a year ago [1] - The reported revenue exceeded the Zacks Consensus Estimate of $366.21 million by 25.22%, while the EPS surprise was 62.14% above the consensus estimate of $1.03 [1] Revenue Breakdown - Product revenue, net was $177.76 million, slightly below the nine-analyst average estimate of $178.43 million, reflecting a year-over-year change of 0.7% [4] - Licensing and other revenue reached $280.82 million, significantly surpassing the estimated $126.67 million, representing a year-over-year increase of 1286.2% [4] - Product Revenue from EMPAVELI was $26.83 million, exceeding the average estimate of $22.06 million, with a year-over-year change of 9% [4] - Product Revenue from SYFOVRE was $150.93 million, slightly below the average estimate of $156.55 million, showing a year-over-year decrease of 0.7% [4] Stock Performance - Shares of Apellis Pharmaceuticals have returned +30.1% over the past month, outperforming the Zacks S&P 500 composite's +3.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $459 million, including a $275 million upfront payment from Sobi related to the EMPAVELI royalty purchase agreement [21] - SYFOVRE net product revenue for the quarter was $151 million, with approximately 101,000 doses delivered, including 86,000 commercial doses and 15,000 free goods doses [21] - Operating expenses were $235 million in Q3 2025, down from $244 million in the same quarter last year [24] Business Line Data and Key Metrics Changes - EMPAVELI generated total net product revenue of $27 million during Q3 2025, with a focus on C3 glomerulopathy and primary immune complex membranoproliferative glomerulonephritis [24] - SYFOVRE maintained a leading position, accounting for an estimated 52% of new patient starts during Q3 2025, with a total injection growth of 4% [15][16] Market Data and Key Metrics Changes - The addressable market for EMPAVELI expanded by approximately 5,000 patients following FDA approval for C3 glomerulopathy and primary ICMPGN [6] - Only about 10% of patients diagnosed with geographic atrophy (GA) are currently treated with complement inhibitors, indicating significant room for growth [16] Company Strategy and Development Direction - The company aims to leverage its expertise in complement-mediated diseases to expand market opportunities for EMPAVELI and SYFOVRE while advancing its pipeline [8][9] - Initiatives to drive growth include targeted market education and the development of artificial intelligence tools to enhance physician understanding of GA [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential of EMPAVELI and SYFOVRE, highlighting positive early feedback from the nephrology community regarding EMPAVELI [26] - The company anticipates steady, measured injection growth for SYFOVRE, with expectations for renewed growth driven by new tools and education initiatives [8][16] Other Important Information - The company ended the quarter with $475 million in cash and cash equivalents, supported by the Sobi transaction [24] - The company plans to initiate pivotal trials for FSGS and DGF by the end of the year, expanding EMPAVELI's development into other rare kidney diseases [20] Q&A Session Summary Question: Regarding the launch of EMPAVELI and C3G - Management expects steady, consistent growth going into next year after the initial wave of early adopters [31] Question: On SYFOVRE sampling and market dynamics - Management is closely monitoring sampling and free goods programs to ensure they are utilized effectively [37] Question: Specifics on C3G patient demographics - Approximately 50 of the 152 start forms are from the Expanded Access Program, with positive feedback on efficacy leading to switches from competitive products [41] Question: Timeline for patient access to EMPAVELI - The typical timeframe for patients to start treatment is four to six weeks, with efforts underway to accelerate this process [52] Question: On the impact of co-pay assistance on patient treatment - The lack of co-pay support has created logistical and financial headwinds, affecting treatment discussions with patients [95] Question: Insights on physician behavior regarding biopsies for C3G - The availability of effective treatments like EMPAVELI motivates clinicians to diagnose and treat patients more aggressively [123]

Third Quarter 2025 Financial Results Conference Call October 30, 2025 Forward-looking statements Statements in this presentation about future expectations, plans and prospects, as well as any other statements regarding matters that are not historical facts, may constitute "forward-looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "projec ...

Group 1 - The article discusses Apellis Pharmaceuticals and its potential market position in the treatment of rare kidney diseases [2] - The author runs a pharmaceutical analysis service that provides in-depth research on various biotech companies, including a model portfolio of small and mid-cap stocks [2] - The service offers a subscription model with a promotional free trial and discounted yearly plan [1] Group 2 - The article emphasizes the importance of data from Apellis regarding rare kidney diseases, suggesting it may lead to a first-to-market advantage [2]

Core Viewpoint - Apellis Pharmaceuticals, Inc. (NASDAQ:APLS) has received mixed opinions from Wall Street following its fiscal second quarter 2025 results, despite the FDA approval of its drug EMPAVELI for rare kidney diseases [1][3]. Financial Performance - The company reported revenue of $178.49 million, which represents a decline of 10.61% year-over-year and fell short of expectations by $10.15 million [2]. - The earnings per share (EPS) was negative $0.33, but this exceeded estimates by $0.15 [2]. FDA Approval and Market Challenges - The FDA approval of EMPAVELI for treating C3 glomerulopathy and primary immune complex membranoproliferative glomerulonephritis is a significant milestone, being the first approved treatment for these conditions in patients aged 12 and older [2][3]. - Analysts have expressed concerns regarding market fragmentation and payor access challenges that may hinder the drug's launch [3]. Analyst Ratings - Tazeen Ahmad from Bank of America Securities maintained a Hold rating with a price target of $26, highlighting the small and possibly underdiagnosed patient group as a limitation for broad uptake [3]. - Conversely, Steven Seedhouse from Cantor Fitzgerald reiterated a Buy rating with a price target of $40, indicating a more optimistic outlook on the stock [4].

Core Insights - Apellis is currently leading the field in complement therapies with two approved products, SYFOVRE and EMPAVELI, and has a promising pipeline ahead [2][3] - The company has been successfully launching EMPAVELI for PNH for a couple of years and recently received approval for C3G and IC-MPGN, presenting significant opportunities to impact patient lives [3] Company Overview - Apellis has established itself as a leader in complement therapies, focusing on complement factor C3, which plays a crucial role in controlling downstream effects of the complement cascade [2] - The company is positioned for growth with its innovative products and expanding indications, particularly in the latter part of the year [2][3]

Financial Data and Key Metrics Changes - The company has a strong balance sheet with a recent financing deal adding $275 million to its resources [11] - The company reported three approvals for its products in recent years, indicating significant progress in its commercial strategy [8][10] Business Line Data and Key Metrics Changes - SYFOVRE is the market leader in the geographic atrophy market, being the first product approved for this condition [9] - EMPAVELI has expanded its market by approximately 5,000 patients with recent approvals for C3G and IC-MPGN, in addition to its initial approval for PNH [10] Market Data and Key Metrics Changes - The company anticipates a steady growth trajectory in the ultra-rare disease market, particularly for EMPAVELI, with about 5,000 patients in the U.S. potentially qualifying for treatment [22][31] - The market for geographic atrophy is substantial, with estimates of over a million patients, indicating significant growth potential for SYFOVRE [45] Company Strategy and Development Direction - The company is focused on innovation and expanding its product pipeline, including the development of APL-3007, which aims to enhance the effectiveness of SYFOVRE [10][66] - The management emphasizes the importance of educating healthcare providers and patients about the benefits of their products to drive adoption [38][48] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the early launch of EMPAVELI in C3G and IC-MPGN, noting strong interest from key opinion leaders and positive early data [13][14] - The company believes it has a blockbuster product with the potential for significant market penetration across its indications, including PNH, C3G, and IC-MPGN [31][32] Other Important Information - The company has a differentiated approach in targeting the complement system, which is believed to be more effective than other treatments currently in development [64] - Management highlighted the challenges of demonstrating significant improvements in best-corrected visual acuity (BCVA) in geographic atrophy studies, emphasizing the importance of lesion slowing as a key measure [57][58] Q&A Session Summary Question: What is the current state of the business? - The company has made significant progress with its two commercial products and a strong balance sheet, feeling positive about its current position [11] Question: How is the launch of EMPAVELI progressing? - The launch is going well, with a broad label from the FDA and strong interest from healthcare providers [13][14] Question: What is the market opportunity for EMPAVELI? - The company believes it has a blockbuster product with a potential market of 5,000 patients in the U.S. and possibly more as awareness increases [31][32] Question: How does the company view competition in the market? - The company feels confident in its differentiated product offerings and the efficacy of its treatments compared to competitors [27][64] Question: What are the growth expectations for SYFOVRE? - Management anticipates low to mid-single-digit growth for SYFOVRE, with ongoing efforts to educate healthcare providers and patients [38][39] Question: How does the company plan to manage its patent lifecycle? - The company is focused on lifecycle management and has a solid patent strategy in place, with extensions potentially extending to 2034 or 2035 [34]

Financial Data and Key Metrics Changes - Apellis Pharmaceuticals reported a strong balance sheet following a recent royalty deal that added $275 million to its resources [11] - The company has achieved three approvals for its products in recent years, indicating significant progress in its commercial strategy [8] Business Line Data and Key Metrics Changes - SYFOVRE, the company's product for geographic atrophy, is the market leader in its category and has shown substantial efficacy over four years of patient data [8][37] - EMPAVELI has expanded its market with recent approvals for C3G and IC-MPGN, increasing the potential patient base by approximately 5,000 patients [9] Market Data and Key Metrics Changes - The company estimates there are about 5,000 patients in the U.S. for C3G and IC-MPGN, with potential for more patients to be diagnosed as treatment options become available [31] - The market for geographic atrophy is large, with approximately 1.5 million patients identified, but only a small percentage currently receiving treatment [45] Company Strategy and Development Direction - Apellis aims to leverage its unique position in complement biology, focusing on the central component C3 to differentiate its products from competitors [5][64] - The company is committed to innovation, with ongoing development of pipeline products like APL-3007, which aims to enhance the effectiveness of SYFOVRE [65][66] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the early launch of EMPAVELI for C3G and IC-MPGN, noting strong interest from key opinion leaders and a broad label from the FDA [13][14] - The company anticipates steady growth in the ultra-rare disease market, with a typical launch pattern expected for EMPAVELI [20] Other Important Information - Apellis is focused on educating nephrologists about the high unmet needs in pediatric and post-transplant patient populations [25] - The company has a strong competitive advantage due to its broad label and the efficacy of its products compared to oral alternatives [27][28] Q&A Session Summary Question: What is the current state of the business? - Management highlighted the strong position of Apellis with two commercial products and a robust balance sheet following a recent financing deal [11] Question: How is the launch of EMPAVELI progressing? - The launch is going well, with a broad label and significant interest from healthcare providers [13][14] Question: What is the market opportunity for EMPAVELI? - The company believes it has a blockbuster product with potential for more patients to be diagnosed as treatment options expand [31] Question: How does Apellis view the competitive landscape? - Apellis sees its broad label and efficacy as key differentiators that set it apart from competitors [27][28] Question: What are the growth expectations for SYFOVRE? - Management expects low to mid-single-digit growth as the brand stabilizes and continues to educate the market [38][39] Question: How does the company plan to innovate moving forward? - Apellis is committed to ongoing innovation and development of new products to address patient needs in both the kidney and retina markets [65][66]