Core Insights - Amgen reported third-quarter 2025 adjusted earnings of $5.64 per share, exceeding the Zacks Consensus Estimate of $5.00 per share, with a year-over-year earnings increase of 1% driven by higher revenues despite increased operating costs and taxes [1] - Total revenues reached $9.6 billion, surpassing the Zacks Consensus Estimate of $8.9 billion, marking a 12% year-over-year increase [1] Revenue Breakdown - Total product revenues increased by 12% year-over-year to $9.17 billion, with volume growth of 14% offset by a 4% negative impact from pricing [2] - Other revenues amounted to $420 million, reflecting a 19.3% year-over-year increase [2] Key Drug Performance - Evenity sales reached $541 million, up 36% year-over-year, exceeding both the Zacks Consensus Estimate of $519 million and the model estimate of $463.9 million [3] - Repatha generated revenues of $794 million, a 40% year-over-year increase, beating the Zacks Consensus Estimate of $720 million and the model estimate of $672.2 million [3] - Prolia revenues were $1.14 billion, up 9% year-over-year, significantly surpassing the Zacks Consensus Estimate of $911 million and the model estimate of $812.8 million [4] - Xgeva delivered revenues of $539 million, flat year-over-year, but exceeded the Zacks Consensus Estimate of $428 million and the model estimate of $408.6 million [5] - Blincyto sales were $392 million, a 20% increase year-over-year, but missed the Zacks Consensus Estimate of $413 million [7] - Otezla sales were $585 million, up 4% year-over-year, beating the Zacks Consensus Estimate of $582 million but missing the model estimate of $648.2 million [8] - Enbrel revenues declined by 30% year-over-year to $580 million, missing the Zacks Consensus Estimate of $645 million but beating the model estimate of $530.4 million [9] - Tezspire recorded sales of $377 million, a 40% year-over-year increase, exceeding both the Zacks Consensus Estimate of $364 million and the model estimate of $270.6 million [10] Cost and Margin Analysis - Adjusted operating margin decreased by 2.5 percentage points to 47.1%, with adjusted operating expenses rising by 18% to $5.25 billion [14] - R&D expenses increased by 31% year-over-year to $1.89 billion, reflecting ongoing investment in the late-stage pipeline [14] Future Outlook - Amgen raised its 2025 revenue and earnings guidance, expecting total revenues between $35.8 billion and $36.6 billion, and adjusted earnings per share in the range of $20.60 to $21.40 [15] - The company anticipates continued growth from key drugs like Repatha, Evenity, Tezspire, and its biosimilar portfolio, although erosion from biosimilars of Prolia and Xgeva may offset some growth [21] Pipeline Developments - Amgen is advancing its obesity drug MariTide, which has shown strong efficacy in clinical studies, with six global phase III studies currently underway [16][17] - Enrollment has been completed in two phase III studies for MariTide, with ongoing studies for cardiovascular disease and heart failure [18]

Financial Data and Key Metrics Changes - The company reported an 11% growth in both portfolio receipts and royalty receipts, reflecting strong business momentum [4][20] - Return on invested capital was 15.7% and return on invested equity was 22.9% for the last 12 months [5][23] - Portfolio receipts for the third quarter reached $814 million, with a projected full-year guidance increase to between $3.2 billion and $3.25 billion, representing growth of approximately 14-16% [25][28] Business Line Data and Key Metrics Changes - The company actively engaged in royalty transactions, deploying $1 billion in the quarter, totaling $1.7 billion for the first nine months [5][24] - Key drivers of growth included strong performance from Voranigo, Tremfya, and the Cystic Fibrosis Franchise [20] Market Data and Key Metrics Changes - The company expanded its development stage pipeline to 17 therapies, with significant potential for cumulative peak sales exceeding $36 billion [14][18] - The company noted a growing market for synthetic royalties, with $1.8 billion in synthetic royalty transactions announced in 2025, surpassing previous years [15][16] Company Strategy and Development Direction - The company aims to be a premier capital allocator in life sciences, focusing on innovative therapies with high patient impact [4][13] - The strategy includes a therapy area agnostic investment approach, allowing for diversification across various disease areas [9][16] - The company raised its full-year guidance for 2025, reflecting confidence in its diversified portfolio and ongoing capital deployment [25][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the uptick in biotech M&A activity, viewing it as beneficial for capital needs in the sector [34][37] - The company is excited about growth opportunities in China, particularly in out-licensing to multinationals [38] - Management emphasized a disciplined approach to capital allocation, focusing on transactions that align with their investment criteria [40][46] Other Important Information - The company repurchased 4 million shares in the quarter, totaling $1.15 billion in share repurchases for the first nine months [5][24] - The company maintains a strong financial position with cash and equivalents of $939 million and access to $2.9 billion in financial capacity [23][24] Q&A Session Summary Question: Impact of biotech M&A and interest rates on royalty-driven deal activity - Management noted that increased M&A activity does not significantly impact their operations, as large pharma companies require capital, which the company provides [34][37] Question: Updates on China strategy - Management highlighted ongoing efforts to build relationships in China, viewing it as a growth opportunity in the royalty marketplace [38] Question: Frequency of collaborations with large pharma - Management indicated that the use of royalties to fund trials is becoming mainstream, presenting a significant opportunity for the company [40][41] Question: Potential changes in risk appetite due to new launches - Management stated that while returns may fluctuate, their investment behavior remains consistent, focusing on attractive transactions regardless of market conditions [46][47] Question: Insights on the Amvuttra deal and competition - Management expressed confidence in the Amvuttra investment, highlighting a unique structure that allows for long-term royalty ownership [60][62] Question: Implications of trial outcomes for LP(a) products - Management remains optimistic about the probability of success for their LP(a) investments, despite potential challenges in trial outcomes [64][66] Question: Updates on obexelimab and market potential - Management noted that recent positive data for obexelimab validates its potential in treating autoimmune diseases, with a focus on IgG4-related disease [75][76]

Financial Data and Key Metrics Changes - The company reported an 11% growth in both portfolio receipts and royalty receipts, indicating strong business momentum [4][20] - Return on invested capital was 15.7% and return on invested equity was 22.9% for the last 12 months [5][23] - Portfolio receipts for the third quarter reached $814 million, reflecting an 11% increase [20] - Full year 2025 top line guidance was raised to between $3.2 billion and $3.25 billion, representing growth of approximately 14%-16% [8][25] Business Line Data and Key Metrics Changes - The company maintained strong returns with significant contributions from Voranigo, Tremfya, and the Cystic Fibrosis Franchise [20] - The development stage pipeline expanded to 17 therapies, with multiple pivotal readouts expected in the near future [7][14] Market Data and Key Metrics Changes - The company is actively participating in the growing market for royalties, with recent acquisitions including a royalty interest in Amgen's Imdelltra and Alnylam's AMVUTTRA [6][10] - The company has seen a significant uptick in deal activity, with a total of approximately $1.6 billion in announced value across three different disease areas [9] Company Strategy and Development Direction - The company aims to be the premier capital allocator in life sciences, focusing on innovative therapies with high patient impact [4][13] - The strategy includes a therapy area agnostic investment approach, allowing the company to invest across various disease areas [15][16] - The company is committed to creating value for shareholders through investments in innovative therapies [13][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the external environment, noting that increased biotech M&A activity could benefit their capital allocation strategy [38] - The company is excited about growth opportunities in China, particularly in out-licensing deals with multinationals [39] - Management emphasized the stability and consistency of their return metrics, indicating confidence in maintaining attractive returns [48][23] Other Important Information - The company has returned a record $1.5 billion to shareholders in the first nine months of the year, including share repurchases and dividends [24][25] - The company maintains financial flexibility with cash and equivalents of $939 million and access to a $1.8 billion revolver [23][24] Q&A Session Summary Question: Impact of biotech M&A and interest rates on royalty-driven deal activity - Management noted that increased M&A activity does not significantly impact their operations and that they see it as beneficial for capital needs in the sector [38][39] Question: Frequency of collaborations with large pharma - Management indicated that as the largest royalty buyer, they are actively looking at all deals and see a growing opportunity for using royalties to fund trials with both biotech and big pharma [41][42] Question: Insights on AMVUTTRA deal and competition - Management highlighted their confidence in AMVUTTRA's potential despite competition from Nucresiran, emphasizing their thorough analysis of various scenarios [51][55] Question: Implications of trial designs in the LP(a) space - Management acknowledged differences in trial designs and expressed optimism about both Amgen's and Novartis's trials, maintaining a positive outlook on their investments in this area [67][75] Question: Updates on obexelimab and its market potential - Management confirmed that the recent phase II data for obexelimab validated their investment thesis and highlighted the focus on IgG4-related disease for near-term capital needs [77][76]

Financial Data and Key Metrics Changes - The company reported an 11% growth in both portfolio receipts and royalty receipts, indicating strong business momentum [4][22] - Return on invested capital was 15.7% and return on invested equity was 22.9% for the last 12 months [6][25] - Portfolio receipts for Q3 2025 reached $814 million, reflecting an 11% increase [22] Business Line Data and Key Metrics Changes - The company maintained strong growth driven by key products such as Voranigo, Tremfya, and the Cystic Fibrosis Franchise [22] - The development stage pipeline expanded to 17 therapies, with multiple pivotal readouts expected in the near future [7][15] Market Data and Key Metrics Changes - The company raised its full-year 2025 top line guidance to between $3.2 billion and $3.25 billion, representing growth of approximately 14-16% [9][20] - Milestones and other contractual receipts are now expected to be around $125 million, up from $110 million previously [20] Company Strategy and Development Direction - The company aims to be the premier capital allocator in life sciences, focusing on innovative therapies with high patient impact [4][31] - The strategy includes a therapy area agnostic investment approach, allowing for diversification across various disease areas [10][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for funding life sciences innovation, highlighting the potential for annualized total shareholder returns in the mid-teens over the next five years [31] - The company is excited about growth opportunities in China, particularly in out-licensing to multinationals [39] Other Important Information - The company deployed $1 billion in capital for value-creating royalty transactions in Q3 2025, totaling $1.7 billion for the first nine months [6][26] - Share repurchases amounted to $1.15 billion in the first nine months of 2025 [26] Q&A Session Summary Question: Impact of biotech M&A and interest rates on royalty-driven deal activity - Management noted that the uptick in M&A activity does not significantly impact their operations, as large pharma companies require capital, which the company provides [38] Question: Thoughts on the China opportunity - Management is optimistic about growth in China and is actively building relationships to capitalize on this market [39] Question: Frequency of collaborations with large pharma - Management believes the use of royalties to fund trials is becoming mainstream, indicating a growing opportunity in this area [41] Question: Insights on the Amvuttra deal and competition - Management expressed confidence in the Amvuttra investment despite potential competition from Nucresiran, citing a broad range of scenarios considered [60] Question: Updates on the LP(a) space and trial designs - Management acknowledged differences in trial designs and remains optimistic about the prospects of their investments in this area [90] Question: Updates on obexelimab and its market potential - Management highlighted the strong phase 2 data for obexelimab, validating its potential in treating autoimmune diseases [92]

Q3 2025 Financial Results November 5, 2025 Forward Looking Statements This presentation has been prepared by Royalty Pharma plc (the "Company"), is made for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy securities. The information set forth herein does not purport to be complete or to contain all of the information you may desire. Statements contained herein are made as of the date of this presentation unless stated otherwise, and neither the deliv ...

Financial Data and Key Metrics Changes - Revenues increased by 12% year over year to $9.6 billion, driven by strong performance across key growth drivers [12][20] - Non-GAAP operating margin was reported at 47%, reflecting significant investments across the business [12][15] - Free cash flow generated in the third quarter was $4.2 billion, indicating operational momentum [15] Business Line Data and Key Metrics Changes - Repatha sales reached $794 million, up 40% year over year, now annualizing at approximately $3 billion [20] - EVENITY delivered $541 million in sales, a 36% increase year over year, with U.S. sales growing 44% [23] - The rare disease portfolio grew 13% year over year to $1.4 billion, with Uplizna sales increasing 46% to $155 million [25] - Tezspire sales rose 40% year over year to $377 million, achieving over $1 billion in sales year to date [27] - The oncology portfolio generated $2.3 billion in sales, growing 9% year over year [29] Market Data and Key Metrics Changes - The biosimilar portfolio saw sales increase by 52% year over year to $775 million, now annualizing at $3 billion [30] - Prolia sales increased by 9% year over year to $1.1 billion, although future quarters may see increased competition negatively impacting sales [24] Company Strategy and Development Direction - The company is focused on expanding access to medicines through initiatives like AmgenNow, which offers Repatha at a significantly reduced price [5][23] - Continued investment in manufacturing with over $3 billion planned for the U.S. in 2025, building on over $40 billion invested since 2017 [7][12] - The company aims to drive innovation in areas of high unmet medical need while maintaining rigorous financial discipline [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining long-term growth, supported by a broad base of innovative medicines [4][11] - The company raised its 2025 guidance for total revenues to a range of $35.8 billion to $36.6 billion and non-GAAP earnings per share to between $20.60 and $21.40 [17] - Management highlighted the importance of the VESALIUS-CV study results for Repatha, which demonstrated significant cardiovascular event reduction [61][62] Other Important Information - The company is actively engaging with policymakers to support policies that improve access and protect innovation [10] - The anticipated approval of Uplizna for generalized myasthenia gravis is expected to expand its patient base significantly [36] Q&A Session Summary Question: Confidence in Olpasiran and Business Development Approach - Management expressed strong confidence in Olpasiran's potential, emphasizing its best-in-class properties and the importance of the Ocean A study [46][47] - The return to pre-Horizon debt levels does not significantly impact the company's business development strategy, which remains focused on earlier-stage opportunities [49] Question: 2026 Guidance and R&D Expenses - Management discussed key growth drivers and the focus on maintaining industry-leading margins while investing in R&D [52][53] - R&D expenses are expected to stabilize after a significant increase, with ongoing investments in late-stage programs [54] Question: VESALIUS-CV Results Impact - The VESALIUS-CV results are anticipated to significantly enhance Repatha's market opportunity, with a focus on improving cardiovascular care [59][60] - Management highlighted the importance of these results in promoting Repatha as a solution for primary prevention of cardiovascular events [62][64] Question: New Biosimilar Guidance Impact - The company does not foresee a change in its strategic focus on biosimilars despite new FDA guidance, maintaining confidence in its competitive position [66][67] - Management believes the biosimilar market is performing well and is committed to ensuring continued access to important medicines [69][70]

Financial Data and Key Metrics Changes - Revenues increased by 12% year over year to $9.6 billion, driven by strong performance across key growth drivers [12][20] - Non-GAAP operating margin was reported at 47%, reflecting significant investments across the business [12][15] - Free cash flow generated in the third quarter was $4.2 billion, indicating operational momentum [15] Business Line Data and Key Metrics Changes - Repatha sales reached $794 million, up 40% year over year, now annualizing at approximately $3 billion [20] - Evenity delivered $541 million in sales, a 36% increase year over year, with a 44% growth in the U.S. [22] - The rare disease portfolio grew 13% year over year to $1.4 billion, now annualizing at over $5 billion [24] - Oncology portfolio generated $2.3 billion in sales, growing 9% year over year [27] Market Data and Key Metrics Changes - The biosimilar portfolio saw sales increase by 52% year over year to $775 million, now annualizing at $3 billion [28] - Uplizna sales increased 46% year over year to $155 million, with significant uptake among rheumatologists [24] Company Strategy and Development Direction - The company is focused on expanding access to medicines through initiatives like Amgen Now, which offers Repatha at a significantly reduced price [5][22] - Continued investment in manufacturing with over $3 billion planned for the U.S. in 2025, building on over $40 billion since 2017 [7][12] - The company aims to drive innovation in areas of high unmet medical need while maintaining rigorous financial discipline [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining long-term growth, supported by a broad base of innovative medicines [4][11] - The company raised its 2025 guidance for total revenues to a range of $35.8-$36.6 billion and non-GAAP earnings per share between $20.60 and $21.40 [17] - Management highlighted the importance of the Vesalius CV study results for Repatha, which demonstrated significant cardiovascular event reduction [58][60] Other Important Information - The company is actively engaging with policymakers to support policies that improve access and protect innovation [10] - The launch of Uplizna in new indications is anticipated, with a PDUFA date set for December 14, 2025 [33] Q&A Session Summary Question: Confidence in Olpasiran and Business Development Approach - Management remains confident in Olpasiran's potential, citing strong genetic and epidemiological data supporting its efficacy [44] - The return to pre-Horizon debt levels does not significantly impact the company's business development strategy, which remains focused on earlier-stage opportunities [45][46] Question: 2026 Guidance and R&D Expenses - Key growth drivers will influence the top line, with a focus on maintaining industry-leading margins while investing in R&D [50][52] - R&D expenses are expected to stabilize after a significant increase over the past year, with ongoing investments in late-stage programs [51] Question: Vesalius CV Results Impact - The Vesalius CV study is expected to significantly enhance Repatha's market opportunity, with a focus on improving cardiovascular care [58][60] - Management emphasized the importance of the study's findings for primary care physicians and the broader healthcare community [61] Question: New Biosimilar Guidance Impact - The new FDA biosimilar guidance does not change the company's strategic focus on biosimilars, which continue to be a strong growth area [65] - The company is well-positioned to adapt to any new regulatory requirements while maintaining competitiveness in the biosimilar market [66][67]

Financial Data and Key Metrics Changes - Revenues increased by 12% year over year to $9.6 billion, driven by strong performance across key growth drivers [10][18] - Non-GAAP operating margin was reported at 47%, reflecting significant investments across the business [11] - Free cash flow generated in the third quarter was $4.2 billion, indicating operational momentum [12] Business Line Data and Key Metrics Changes - Repatha sales reached $794 million, up 40% year over year, now annualizing at approximately $3 billion [18] - Evenity delivered $541 million in sales, a 36% increase year over year, with a 44% growth in the U.S. [20] - The rare disease portfolio grew 13% year over year to $1.4 billion, with Uplizna sales increasing 46% to $155 million [23] - Tezspire sales rose 40% year over year to $377 million, achieving over $1 billion in sales year to date [25] - The oncology portfolio generated $2.3 billion in sales, growing 9% year over year [26] Market Data and Key Metrics Changes - The biosimilar portfolio saw sales increase by 52% year over year to $775 million, now annualizing at $3 billion [27] - Evenity holds over 60% market share in the U.S. bone builder segment, with significant untapped potential [21] - Repatha is now accessible to over 95% of insured patients in the U.S., with most paying less than $50 out of pocket [19] Company Strategy and Development Direction - The company is focused on expanding access to medicines through initiatives like Amgen Now, which offers Repatha at a significantly reduced price [20] - Continued investment in manufacturing with over $3 billion planned for the U.S. in 2025, building on over $40 billion since 2017 [5] - The company aims to drive innovation in areas of high unmet medical need while maintaining rigorous financial discipline [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining long-term growth, supported by a broad base of innovative medicines [3] - The company raised its 2025 revenue guidance to a range of $35.8-$36.6 billion and non-GAAP earnings per share to between $20.60 and $21.40 [15] - Management highlighted the importance of the Vesalius CV study results for Repatha, which could significantly impact cardiovascular care [57][59] Other Important Information - The company plans to continue leveraging AI across various stages of the value chain to enhance productivity [12] - Capital expenditures for 2025 are expected to be approximately $2.2-$2.3 billion, focusing on expanding network capacity [13] Q&A Session Summary Question: Confidence in Olpasiran and Business Development Approach - Management remains confident in Olpasiran's potential, emphasizing its best-in-class properties and the importance of the Ocean A study [42][43] - The return to pre-Horizon debt levels does not significantly alter the company's approach to business development, which remains focused on earlier-stage opportunities [44] Question: 2026 Guidance and R&D Expenses - Management discussed key growth drivers and the focus on maintaining industry-leading margins while investing in R&D [46][49] - R&D expenses are expected to stabilize after a significant increase, with ongoing investments in late-stage programs [50][51] Question: Vesalius CV Results Impact - The Vesalius CV study is anticipated to enhance Repatha's market opportunity, with management highlighting its significance in preventing first cardiovascular events [54][57] - The study's results will be shared at the upcoming AHA meeting, emphasizing the need for improved cardiovascular care [59][60] Question: New Biosimilar Guidance Impact - The company does not foresee a change in its strategic focus on biosimilars, viewing the market as performing well despite new guidance [63][66] - Management remains committed to competing effectively in the biosimilar space, regardless of regulatory changes [64][65]

Core Viewpoint - Amgen's stock presents an attractive long-term investment opportunity despite recent share price declines and upcoming patent cliffs [1][2]. Group 1: Promising Drug Developments - Amgen is developing MariTide, a weight management drug that has shown a mean weight loss of up to 20% over 52 weeks, with a favorable monthly dosing schedule [4][5]. - The anti-obesity market is rapidly growing, and MariTide could generate sales of up to $3.7 billion by 2030, helping Amgen offset losses from patent expirations [6]. - Amgen has a robust pipeline with several ongoing programs, including bemarituzumab, which has shown promising results in a phase 3 study for metastatic gastric cancer [7][8]. Group 2: Recent Product Launches - Amgen's recent product approvals, such as Imdelltra for lung cancer, Tezspire for asthma, and Uplizna for rare diseases, are expected to contribute to top-line growth [9][10]. Group 3: Financial Strength and Dividends - Amgen has a strong dividend track record, having increased its dividend by 201.3% over the past decade, with a current yield of 3.5% [11][12]. - The company's cash payout ratio of 46.5% provides room for further dividend increases, making it an attractive option for investors seeking income [12][13]. Group 4: Valuation - Amgen's shares are considered reasonably valued, with a forward price-to-earnings ratio of 12.6, lower than the healthcare industry average of 16.4 [14][15]. - The market may be pricing in upcoming patent losses, but long-term investors could benefit from potential revenue and earnings growth as new products are launched [15].

Core Insights - Investing in dividend growth stocks is highlighted as one of the easiest and most effective strategies on Wall Street [1] Company Analysis: Watsco - Watsco, the largest HVACR parts distributor in America, has increased its dividend payout by 69% over the past five years, currently offering a yield of 2.8% [4][5] - The company has grown by acquiring over 70 businesses and has no debt on its balance sheet as of June [5] - Watsco is leveraging online applications for contractors, with 70,000 mobile app users facilitating the quote process and ordering parts [6] - Despite a 3% revenue decline in the first half of 2025 due to temperate weather and lower homebuilding activity, Watsco's sales are primarily from repairs and replacements, which may mitigate investor concerns during economic slowdowns [7][8] Company Analysis: Amgen - Amgen, a long-established biotechnology company, has raised its dividend payout by 48% over the past five years, currently offering a yield of 3.4% [10] - The company reported a 34% year-over-year decline in sales of its arthritis treatment Enbrel, amounting to an annualized $2.4 billion, but has invested profits into new drug developments [10] - Amgen's overall sales grew by 9% year over year to $8.8 billion, with double-digit growth in 15 products [11] - The new treatment Imdelltra for small-cell lung cancer has shown promising results, potentially becoming standard care, which could drive future sales growth [12][13]