Lantheus Holdings(LNTH) - 2025 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Consolidated net revenue for Q2 2025 was $378 million, a decrease of 4.1% year over year [20] - Adjusted net income for Q2 was $110.6 million, a decrease of 12.8% [24] - GAAP fully diluted earnings per share for Q2 were $1.12, with adjusted earnings per share at $1.57, both down 12.8% [24] Business Line Data and Key Metrics Changes - Sales of Polarify were $251 million, down 8.3% year over year, with U.S. volumes up 2% year over year and over 4% sequentially [12][21] - Precision Diagnostics revenue was $115.8 million, up 3.3%, with DEFINITY sales at $83.9 million, up 7.5% [21] - Strategic partnerships and other revenue increased by 32.8% to $11.6 million, driven by contributions from MK6240 and the newly acquired Evergreen CDMO business [22] Market Data and Key Metrics Changes - The PSMA PET market faced competitive pricing pressures, particularly from an F-eighteen competitor, leading to account losses and renegotiations [13][14] - The broader market for PSMA PET is expected to grow in the mid to high teens, while Polarify is anticipated to grow in the low single digits [39] Company Strategy and Development Direction - The company is focused on diversifying its portfolio and enhancing its capabilities in the radiopharmaceutical value chain through acquisitions [9] - A new $400 million stock repurchase program was authorized, reflecting confidence in the business's intrinsic value and future growth potential [11] - The FDA has accepted the NDA for a new formulation of Polarify, expected to increase batch size by approximately 50%, enhancing production efficiency and patient access [6][17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that Q2 results were below expectations and lowered the financial outlook for the remainder of 2025 [4] - The company is taking a disciplined approach to pricing to preserve the long-term value of its PSMA PET franchise [7][16] - Management expressed confidence in the long-term strategy and the ability to execute, despite current market dynamics [11][28] Other Important Information - The company expects full-year revenue to be in the range of $1.475 to $1.51 billion, down from the previous range of $1.55 to $1.585 billion [27] - The anticipated launch of four additional radiopharmaceutical products is expected to diversify revenue streams [10] Q&A Session Summary Question: Thoughts on achieving double-digit growth in 2026 - Management believes it is achievable through a combination of organic and inorganic growth, with key factors including the performance of DEFINITY and the impact of recent acquisitions [30][31] Question: Guidance for LMI's contribution to revenue - The forecast for LMI's contribution is $40 million to $45 million in net revenue with an EPS accretion of $0.04 [37] Question: Impact of new formulation on long-term contracts - The new formulation will be an add-on to existing contracts, potentially allowing for a 340B price reset [49] Question: Commercial opportunity for tau imaging - The company sees significant potential in the tau imaging market, which could be similar in size to Polarify [52] Question: Market share and contracted business for Polarify - The majority of the business is under contract, and management has made strategic decisions to walk away from certain accounts to protect long-term value [56][61]