Core Insights - Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) has shown steady revenue growth, with a 3% increase in fourth-quarter sales compared to the previous year, driven by double-digit growth in three key products [2][3] Sales Performance - Global net sales of DUPIXENT increased by 32%, while LIBTAYO sales rose by 13% on a constant-currency basis [3] - In the U.S., EYLEA HD sales surged by 66%, indicating strong momentum in the domestic market [3] Product Highlights - DUPIXENT is described as a core pillar of Regeneron's business, currently used by over 1.4 million patients worldwide, with further growth anticipated [4] - LIBTAYO has shown progress, particularly in adjuvant CSCC and gaining market share in advanced non-small cell lung cancer, becoming the second most prescribed immunotherapy in the first-line setting in the U.S. [4] Future Outlook - The company has a busy regulatory and development agenda, expecting at least four FDA approvals, including three new molecular entities and the EYLEA HD prefilled syringe [5] - Plans include launching 18 additional Phase III studies over the coming years, with an estimated total enrollment of about 35,000 patients, aimed at supporting the next wave of potential blockbuster products [5]

Core Insights - Longleaf Partners Fund returned 3.35% in Q4 2025, outperforming the S&P 500's 2.66% but underperforming the Russell 1000 Value Index's 3.81% [1] - The firm faced challenges in 2025, with only 5% of the portfolio gaining 20% or more compared to 35% of the S&P 500 [1] - The firm emphasizes strengthening portfolio outcomes over chasing short-term winners, advocating for a focus on real companies during speculative periods [1] Company Focus: Regeneron Pharmaceuticals, Inc. - Regeneron Pharmaceuticals, Inc. had a one-month return of -5.94% and a 52-week gain of 7.55%, with a market capitalization of $77.693 billion [2] - Initially a detractor, Regeneron became a contributor in Q4 2025, with a phased buy-in strategy proving effective [3] - The company is well-positioned in allergic diseases and oncology, with a focus on its pipeline value rather than just EYLEA, which constitutes less than 20% of its value [3] - Regeneron has a net cash balance sheet, strong owner-partners, and has avoided large M&A, opting for significant share repurchases in 2025 [3]

Financial Data and Key Metrics Changes - Regeneron reported total revenues of $3.8 billion for Q3 2025, reflecting a 1% increase compared to the prior year, driven by higher collaboration revenue from Sanofi and growth in net sales of Dupixent and LIBTAYO, partially offset by lower EYLEA sales [39][40] - Diluted net income per share was $11.83, with net income reaching $1.3 billion [39] - Gross margin on net product sales was 86%, lower than the previous year due to a changing product mix and increased investments in manufacturing operations [41] Business Line Data and Key Metrics Changes - Dupixent achieved worldwide net sales of $4.9 billion in Q3 2025, a 26% increase year-over-year at constant currency, with U.S. sales growing 28% [7][35] - LIBTAYO's global net sales were $365 million, up 24% on a constant currency basis, with U.S. sales growing 12% [9][36] - EYLEA HD reached U.S. net sales of $431 million, an all-time high, while EYLEA sales decreased 10% to $681 million due to competitive dynamics and patient affordability issues [10][33] Market Data and Key Metrics Changes - Dupixent is positioned to address over 4 million patients in the U.S., with more than 1.3 million patients currently treated globally [8] - LIBTAYO is the market leader in advanced non-melanoma skin cancers and has recently been approved for high-risk adjuvant cutaneous squamous cell carcinoma, with an estimated 10,000 eligible patients in the U.S. [9][37] - EYLEA HD now represents approximately 40% of Regeneron's U.S. retina franchise, with expectations for moderate to high single-digit demand growth in the upcoming quarter [34] Company Strategy and Development Direction - Regeneron is focused on maximizing growth from existing brands while launching new products and indications, with significant investments in R&D to support its pipeline [16][39] - The company is engaged in discussions with the U.S. government to lower drug costs while preserving innovation and has committed over $7 billion to infrastructure and manufacturing in the U.S. [15][39] - The pipeline includes advancements in immunology, oncology, and rare diseases, with positive Phase III data for several programs [12][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ongoing discussions with the U.S. government regarding drug pricing and the importance of U.S. manufacturing for national security [15] - The company anticipates continued growth across its commercial portfolio, with a focus on addressing unmet patient needs and expanding treatment options [16][39] - Regeneron expects to advance multiple registrational programs in 2026, with a mid-teens percentage increase in R&D expenses planned [43] Other Important Information - The FDA issued a complete response letter for the prefilled syringe supplemental BLA for EYLEA HD due to unresolved inspection findings at a third-party facility [11] - Regeneron is advancing its siRNA portfolio and has made significant progress in clinical trials for various conditions, including ultra-rare diseases [29][30] Q&A Session Summary Question: Changes in EYLEA commercial strategy and pricing - Management acknowledged competitive issues and emphasized the importance of EYLEA HD's clinical efficacy and safety in driving its performance [45][48] Question: Future balance sheet utilization for large deals - Management indicated openness to using the balance sheet for strategic opportunities and highlighted ongoing investments in domestic manufacturing [54][56] Question: Importance of label enhancements for EYLEA HD - Management noted that label enhancements are crucial for providing dosing flexibility and improving market share [59][60] Question: Insights from IL-33 COPD trials - Management refrained from commenting on specific insights but indicated plans for further discussions with the FDA [63][64] Question: Probability of approval for RVO and dosing filing - Management discussed the complexities of the approval process and the timeline for the new filler, expressing cautious optimism [66][68] Question: Internal changes to prevent CRLs - Management clarified that issues were not due to internal regulatory problems but rather manufacturing challenges, emphasizing ongoing efforts to rectify the situation [72][75] Question: Factor XI antibody program and future opportunities - Management highlighted the focus on understanding the benefit-risk ratio and the potential for broader applications of the Factor XI antibodies [78][80]

Financial Performance - Regeneron reported total revenues of $3.75 billion for Q3 2025[8] - The company's Non-GAAP EPS for Q3 2025 was $11.83[8] - Dupixent global net sales reached $4.9 billion in Q3 2025, representing a 26% year-over-year increase[12] - EYLEA HD and EYLEA together held approximately 60% of the U S branded anti-VEGF category share in Q3 2025[26] - Libtayo global net sales for Q3 2025 were $365 million, a 24% increase year-over-year[34] Pipeline Developments and Regulatory Milestones - A positive CHMP opinion was received for CSU, with an EC decision expected soon[8, 12] - FDA approved Libtayo for adjuvant treatment of CSCC with high risk of recurrence[11, 32] - Positive Phase 3 data was announced for cemdisiran in generalized myasthenia gravis, with FDA submission expected in 1Q26[11] - Positive Phase 3 data was announced for garetosmab in FOP, with FDA submission expected by year-end 2025[11] Strategic Initiatives - Regeneron Genetics Center has created a large DNA sequence-linked healthcare database to improve drug discovery and healthcare analytics[6] - The company anticipates reimbursing approximately $1 billion in 2025 towards Sanofi's antibody development balance[18] - The company is investing >$5 billion into R&D in 2025[112]