管理層發言
Please stand by. We are about to begin. Good morning. My name is Jess, and I will be your conference operator today. At this time, I would like to welcome everyone to Biogen's second quarter 2026 earnings call and business update. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. To ask a question, please press star one on your telephone keypad. If you require any further follow-up, you may press one again to rejoin the queue. Today's conference is being recorded. Thank you. I would now like to turn the conference over to Tim Power. Tim, you may begin your conference.
Thanks, Jess, and good morning, everyone. Welcome to Biogen's second quarter 2026 Earnings Call. During this call, we will make forward-looking statements which involve risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. We provide a comprehensive list of risk factors in our SEC filings, which I encourage you to review. Our earnings release and other documents related to our results as well as reconciliations between GAAP and non-GAAP results discussed on this call can be found in the Investor section of biogen.com. We have also posted slides to our website that will be used during the call. On today's call, I am joined by our President and Chief Executive Officer Christopher A. Viehbacher; Dr. Priya Singhal, Head of Development; and Robin Kramer, our Chief Financial Officer. Alisha Alaimo, President, North America, will also be available for the Q&A section of the call. We will make some opening comments and we will move to Q&A. To allow us to get through as many questions as we can, we kindly ask that you limit yourself to just one question. And I will now turn the call over to Christopher.
Thank you, Tim. So if I take the three elements that I think contribute to that, first is our growth product portfolio. Now even before we include the products from Apellis, we have seen significant growth. In fact, our growth portfolio now is greater than our legacy MS portfolio. That has really been most recently enhanced by two important achievements. The first is SPINRAZA high-dose, where we have seen strong uptake across all markets. The first market to be approved was Japan, then Europe, and now the U.S. And we are starting to see this roll out into more international markets. In all of those markets, this conversion has gone much faster than we expected. That is an important development for us because this is an extremely competitive market where efficacy matters. We have seen considerable efficacy benefits come from the high-dose of SPINRAZA. This is a franchise we see for the longer term because we have salinursen coming along behind that. We are maintaining market share, and in fact we are seeing some anecdotal switchbacks particularly from the oral product to SPINRAZA. This is important not only for the quarter but for the franchise long-term. The second major achievement this quarter was really the LEQEMBI IQLIK approval. It is the first of its kind Alzheimer's treatment offering home dosing for both initiation and maintenance. I see two, maybe three, opportunities here. First, with the biweekly infusion, physicians are thinking carefully about which patients are eligible for treatment. If they do not think a patient can get to infusion centers on their own or lacks a caregiver to take them, those patients are often not offered treatment. This home dosing option should make it easier for a broader set of patients to become eligible. We also think there could be a benefit in maintaining patients longer on therapy. Finally, we think there is a competitive advantage because the competitor's once-monthly dosing advantage appears reduced when you have a home option. The second element is our pipeline, and Priya will speak to that in a few minutes. The third element is SYFOVRE and Empaveli from the acquisition of Apellis. You have seen strong double-digit growth for both the full quarter and year-to-date for the combined sales of those two products. We only began consolidating revenue from May 14 when we closed the transaction, but those products are already contributing significantly to our growth. On integrations, one of the most important metrics is how revenue performs through the period of turbulence in the organization. Major transactions bring uncertainty; the ability to maintain continuity of revenue is the number one measure of integration success. So far, we have seen that, largely because this is mostly a U.S. transaction. This is a credit to Alisha's leadership and her team. Reaching out and making sure the former Apellis employees feel great about joining Biogen has been critical. When I speak to them, one senses energy, passion, and commitment. We are encouraged by the importance of this acquisition. Next, Priya will talk more about our late-stage registrational pipeline, but we now have five registrational Phase 3 clinical trial results coming along: two in SLE for lupus, one in CLE for lupus, one for AMR, and one from our partner Stoke for Dravet syndrome. These are within the next four quarters and are imminent; they could make a difference to Biogen's long-term growth outlook. As we discussed before, we are also rebuilding our early-stage pipeline. We went three years without filing an IND. We made dramatic moves to overhaul our research organization and approach to research. The encouraging thing is that we are now in a much better place in our early-stage pipeline. We have had three INDs already this year and more to come. We've done key collaborations like with Vanqua and Dayra last year, and the acquisition of Braceira this year substantially boosted our early-stage pipeline. This is investing today for products that would launch in the mid-2030s. You have to start now to have growth tomorrow. At JPMorgan earlier this year, we highlighted near-term growth drivers: LEQEMBI, ZURZUVAE, VUMERITY, SPINRAZA, SKYCLARYS, and QALSODY. That group now exceeds our legacy MS portfolio and grew strongly in the quarter. When you add SYFOVRE and Empaveli, these products are enough to help Biogen return to a growth story. Looking ahead to imminent data readouts and the second wave of registrational late-stage pipeline, these are all products with significant opportunity. This marks a major shift for Biogen. Three-and-a-half years ago, when I arrived, we primarily visited neurologists. We had a few MS products and SPINRAZA. We are now engaging rheumatologists, dermatologists, nephrologists, epileptologists, and transplant nephrologists outside the U.S. Our portfolio breadth has expanded significantly. That is exciting, but now we must execute on that growth story. Many efforts across the company are focused on making those launches successful. We are also keeping an eye on longer-term opportunities—the third wave. You have seen promising data on new modalities in Alzheimer's. While not part of the equity story near-term, longer term this could significantly contribute to Biogen's growth. A renewed early-stage pipeline is important to that research portfolio. From a BD/M&A perspective, we have what we need to grow near-term. We will be less intentional about large M&A and more opportunistic, but intentional about early-stage development. Ideally, we want assets between development candidates and IND stage. When you look at potential addressable markets coming from the pipeline, lupus could be a potential $8 billion market. The MS market is over $20 billion. Today, it may be a $2 to $3 billion market, but there is no real reason the lupus market should not be the size of MS. Even the $8 billion figure is significant. We hope to be first for CLE. AMR has approximately 11,000 patients in the U.S. alone, with Phase 3 data coming in early 2027; that's at least a $2 billion addressable market depending on pricing, and IgAN pricing will have a spillover effect on AMR. Microvascular inflammation is another indication with growth potential. For felzartamab we have IgAN and PMN data coming later. For Dravet syndrome, we have U.S. rights and ex-U.S. markets include about 7,000 patients in Europe alone, which across key territories could be at least a $2 billion opportunity. We're about 18 to 24 months from launch for some of these, but the potential highlights why we must execute with excellence and why we're investing today to make those launches successful. If you look at Biogen pre-Apellis, consensus was roughly flat through 2030. I think we are already seeing that consensus shift as people appreciate the Apellis transaction. When you add Apellis marketed products to our growth portfolio, we are seeing a growing picture. With the late-stage registrational pipeline on top of that growing base, the strategy to return to sustainable revenue growth is clear. With that, Priya can talk a little bit more about the late-stage registrational pipeline.
Thank you, Christopher, and good morning, everyone. As we deliver the new Biogen, a large part of our transformation and near-term opportunity for growth comes from our late-stage pipeline, as Christopher mentioned, and I am excited about this future. That is because today we have one of the strongest and most diversified late-stage pipelines in Biogen's history with multiple near-term opportunities to create value in the upcoming years. We shared this slide with you at the beginning of the year, and today you can see that we are delivering on the opportunities we outlined, including the FDA approval of IQLIK initiation, which is an important innovation for patients and caregivers. Beyond IQLIK, Biogen and Eisai presented new data at AAIC earlier this month. This included real-world evidence supporting the long-term benefits of continuous LEQEMBI treatment. We also shared new data for BIIB080/dirinersen establishing proof-of-concept in Alzheimer's disease and we are now focused on developing the next steps for the program. More broadly, we continue to demonstrate medical leadership across our portfolio with important new data presentations for both felzartamab and zolevameran. While these milestones reinforce the potential of our portfolio today, what makes this period particularly exciting is what lies ahead in the near-term. We are now entering a multiyear registrational cycle beginning with SLE data by the end of this year and followed by multiple catalysts extending through the remainder of the decade. While we remain focused on advancing our high-conviction late-stage opportunities, in parallel we continue to invest in the next wave of innovation. The progress we have made this quarter has meaningfully accelerated the transformation of our pre-proof-of-concept pipeline. At this point in the year, we are now beyond our high-risk, high-reward readouts as we mentioned at the outset. This includes our Phase 2 BTK inhibitor, BIIB091, where we achieved proof-of-concept in relapsing remitting MS. In line with our disciplined approach in how we advance assets, we are evaluating next steps given the increasingly competitive nature of that market. As we rebuild our early-stage pipeline, we expect to add six new programs this year, including new Phase 2 proof-of-concept studies to broaden the potential of felzartamab and Empaveli in autoimmune disease, as well as first-in-human studies from our internal pipeline and the lead asset from the pending Braceira acquisition, which is already in Phase 1. Overall, we believe these investments are building a durable innovation engine with the promise of delivering sustainable, long-term growth and value creation. As we look across the next several quarters, we expect readouts from five registrational studies across four important indications: SLE, CLE, AMR, and Dravet syndrome. Reflecting the strong execution of our teams and enrollment momentum, we have accelerated the expected Phase 3 readouts for felzartamab in AMR and litifilimab in CLE, with data now expected in the first half of 2027. Later this fall, we also look forward to presenting new 52-week data from the Phase 2 portion of the ongoing AMETHYST study at the EADV annual conference, which we believe will provide important insights into the durability of response for litifilimab in CLE. Taken together, these milestones are expected to generate important data over the next several months that have the potential to shape our next phase of growth. In summary, the strategic decisions and investments we have made over the past three to four years have positioned us to deliver near-term readouts while advancing long-term innovation. We look forward to continuing to share our progress with you. With that, I would now like to turn the call over to Robin who will provide a financial update for the quarter.
Thank you. Thank you, Priya. Good morning, everyone. I am pleased to be speaking with all of you today following a strong revenue performance in the second quarter. Total second-quarter core pharmaceutical revenue was $1.8 billion, up 4% year-over-year and 12% quarter-over-quarter. This performance was driven by our growth portfolio, which generated over $1 billion of revenue in the quarter, up 24% year-over-year and 25% quarter-over-quarter. The Biogen standalone growth products, excluding Apellis' SYFOVRE and Empaveli revenue, were $933 million, up 9% year-over-year and 10% quarter-over-quarter, generating revenue in excess of our legacy MS portfolio again this quarter. Our growth portfolio has been further strengthened with the addition of SYFOVRE and Empaveli from the Apellis transaction, which generated $128 million in combined revenue for the period post the May 14 acquisition date. This quarter's results demonstrate strong commercial execution and the significant progress we have made in our portfolio transition. Let me now take you through some key highlights from our core pharmaceutical product performance in the second quarter. First, for the growth portfolio: SPINRAZA revenue was $402 million, up 2% year-over-year and 7% quarter-over-quarter. This was driven by both demand and stocking for the high-dose regimen in the U.S., partially offset by shipment timing in certain ex-U.S. markets. High-dose SPINRAZA was approved in the U.S. in March, the EU in January, and Japan last year. During the period of patient transition to the high-dose regimen, we benefited from revenue associated with the one-time transition dose. SPINRAZA high-dose maintenance is priced at parity with SPINRAZA. We are pleased the pace of conversion to high-dose has been going well, and enthusiasm from the patient community for a higher efficacy option has been strong. We also believe this is encouraging for the opportunity for our registrational pipeline asset salinursen, which has recently received Breakthrough Therapy designation. VUMERITY revenue was $197 million, down 7% year-over-year partly driven by inventory dynamics, and up 10% quarter-over-quarter. Revenue for the first half of 2026 was up 7% versus the comparable period in the prior year. LEQEMBI end-market revenue was $184 million, up 15% year-over-year and 9% quarter-over-quarter. We saw continuation of market growth in key markets, including the U.S., Japan, and China. We are pleased to have received FDA approval for IQLIK initiation earlier this month. SKYCLARYS saw patient demand growth both in the U.S. and ex-U.S. In the second quarter, revenue was $168 million, representing 29% growth year-over-year and 11% quarter-over-quarter. SKYCLARYS is now available in 36 countries, and we continue to expect SKYCLARYS growth to come largely from ex-U.S. as we advance the launch. ZURZUVAE continued to show strong underlying demand growth with revenue of $71 million, and we are pleased to announce ZURZUVAE is now launched in Germany. For the MS portfolio, TYSABRI continued to demonstrate resilience in the midst of a biosimilar launch in the U.S. and Europe. Second quarter revenue of $451 million was down 1% year-over-year and up 2% quarter-over-quarter. We have invested for a long time to establish TYSABRI as an important option for MS patients, and we are pleased to see this reflected in its resilience. Turning now to an update on the Apellis acquisition, which closed mid-quarter on May 14: the integration is progressing well, and both SYFOVRE and Empaveli had strong performance in the quarter. SYFOVRE continued to demonstrate market leadership with total revenue in the quarter of $162 million, up 8% year-over-year, with total commercial injections up 13% year-over-year. Empaveli continues to launch in C3G and primary IC-MPGN, with total revenue of $46 million, up 123% year-over-year and 12% quarter-over-quarter. The Apellis acquisition accelerates our return to growth. It adds two best-in-class commercialized medicines to our growth portfolio, which we expect to contribute materially to our top-line growth in the near and long term. We expect SYFOVRE and Empaveli on a combined basis to grow in the mid- to high-teens through at least 2028. In addition, we expect this transaction to materially increase our non-GAAP diluted EPS CAGR through the end of this decade. We expect approximately $120 to $130 million of impact to our other income and expense line in both 2026 and 2027 associated with interest expense and foregone interest income associated with financing the transaction. We expect to generate at least $250 million of run-rate synergies by the end of 2027, largely from optimization of general and administrative expenses and research and development. For 2026, we expect approximately $0.85 of non-GAAP EPS dilution primarily from financing costs associated with the transaction. We expect the transaction to be accretive to non-GAAP diluted EPS in 2027. We believe this transaction represents an attractive use of capital that will further bolster both our top-line and bottom-line growth prospects in therapeutic areas aligned to our immunology and rare disease strategy. Moving on to financial highlights: total revenue for the quarter was $2.7 billion, up 3% year-over-year. Revenue from anti-CD20 royalties and profit share included in other revenue was $514 million, up 10% year-over-year. This increase was driven by royalties from Ocrevus, which benefited from the recent subcutaneous launch, and resilience from Rituxan in the U.S. In addition to the revenue contribution in the quarter from SYFOVRE and Empaveli, our results of operations for the second quarter of 2026 include a half quarter of operating expenses and financing costs associated with the Apellis acquisition. Non-GAAP cost of sales as a percentage of revenue was 22% in Q2 2026 versus 21% last year, primarily due to product mix and increased contract manufacturing revenue. GAAP cost of sales as a percentage of revenue was also impacted by higher amortization costs associated with acquired inventory fair value step-up adjustments for SKYCLARYS from the Reata transaction and SYFOVRE and Empaveli from the Apellis transaction. Non-GAAP core OpEx (combined R&D and SG&A) increased 20% year-over-year. This reflects approximately $95 million of Apellis operating expenses from the May 14 acquisition date through the end of the quarter. For R&D, it reflects investments in our Phase 3 clinical programs, including felzartamab's indication in MVI and salinursen, which were advanced as registrational studies in the second half of 2025, and litifilimab where we expect the Phase 3 SLE data later this year, including a $25 million year-over-year decrease in R&D funding from royalty pharma funding for litifilimab. For sales and marketing, it reflects support of our U.S. and international product launches and investments in prelaunch activities for our late-stage high-conviction pipeline. As previously announced, we recorded $164 million of acquired IPR&D and milestone charges associated with our investments in the development pipeline in the second quarter of 2026, including a $100 million upfront to TJ Bio associated with acquisition of felzartamab rights in China, giving us worldwide rights, a $45 million milestone payment to Ionis in connection with initiation of the Phase 3 trial for salinursen in SMA, and a $15 million upfront to Ionis to opt in to BIIB147 in broad ALS. Turning to cash flow and the balance sheet: we continue to generate strong cash flow, with $408 million of free cash flow generated in the second quarter. We exited the quarter with $1.3 billion of cash and $6.8 billion of net debt. We closed the Apellis transaction in the second quarter, which was funded with $3 billion of cash from the balance sheet and a $1 billion term loan. During Q2, we repaid $200 million of the term loan and continue to expect to repay the remainder by the end of 2027. Turning now to guidance: based on the expected revenue performance of our base business, including our products and TYSABRI, our guidance update reflects a 60-point increase in the underlying business guidance compared to our previous guidance. We are increasing total revenue guidance from a mid-single-digit percentage decrease to a mid-single-digit percentage increase. This reflects the expected performance of our growth products and TYSABRI as well as the addition of SYFOVRE and Empaveli. Our guidance also reflects updates to core operating expenses, other income and expense, and our full-year tax rate primarily to incorporate the impact of the Apellis acquisition. We expect core operating expenses in the second half of 2026 to be between $2.65 billion and $2.7 billion. Our guidance reflects updates associated with investments in the early and late-stage pipeline as well as near- and midterm growth and incorporates transactions executed and our current expectations for the remainder of the year. It incorporates approximately a $3 non-GAAP diluted EPS impact of charges associated with IPR&D and milestones, including the Q2 TJ Bio transaction, the Ionis milestone associated with achieving first patient dosed in STELLAR (our pivotal Phase 3 salinursen study in SMA), the pending Braceira transaction adding a Phase 1 immunology asset into the early-stage pipeline expected to close in Q3, and the expected full-year 2026 $0.85 dilution associated with the Apellis transaction, largely driven by financing costs. Our updated 2026 full-year non-GAAP diluted EPS range is now between $12 and $13. Please review the slide and slide 25 in the appendix and our press release for other important full-year 2026 guidance assumptions. In closing, strong commercial execution in the Biogen base business and the addition of SYFOVRE and Empaveli resulted in strong top-line performance in Q2, and the completion of the Apellis acquisition accelerates our near- and mid-term top-line and bottom-line growth potential. With that, I would like to pass the call back to Tim to open us up for questions.
Thanks, Robin. Jess, could we go to our first question, please?
Certainly. To ask a question, please press star one on your telephone keypad. Your first question comes from the line of Chris Schott with JPMorgan.
分析師問答
Great. Sorry, on mute again. Just a quick question on high-dose SPINRAZA. Can you elaborate a little bit more on how the ramp is coming here compared to internal expectations? Any metrics you can share on the conversion you are seeing in some of the markets where the product has been launched longer? Maybe as part of that answer, can you just talk about how meaningful the impact from patients switching back to high-dose is to overall volumes of the product as well? I am trying to get a general sense of how this is progressing and impacting the franchise. Thank you.
Hi, Chris. I will take that question. If you think about SPINRAZA, it was almost a decade ago when the first SMA treatment was introduced. SPINRAZA still sets the bar on efficacy in this space. SPINRAZA high-dose came from patients asking if a higher dose could deliver greater benefit. Biogen developed this new formulation, and now we have high-dose. We are seeing demand and urgency driven by the patient community. In terms of metrics, SPINRAZA high-dose is exceeding the original launch of SPINRAZA in both starts and GRADs in the first 13 weeks of launch, and we are growing every single week. In Q2 revenue, sites are ordering high-dose to prepare for each patient's next dose. Because of the dosing schedule, you may wait a quarter or two depending on when the last dose was given. Feedback from patients and physicians who have received the product has been quite positive. Our teams are supporting payer approvals, P&T reviews, and patient transitions. In this initial bolus of launch demand, the majority of patients are transitioning from SPINRAZA 12 mg to high-dose. However, we also have several patients who are new to SPINRAZA, particularly babies who had not been dosed in years, and we are seeing babies now getting dosed. We have also had several switchbacks from Evrysdi. For this year, you will see the bolus of transitions through the beginning of next year, but our big focus for 2027 is on new starts and switchbacks. One advantage that we did not realize would be so positive is that SPINRAZA 12 mg had four loading doses, whereas high-dose requires only two. Some patients are more willing to do two loading doses versus four, and that is contributing to switchbacks and starts.
The U.S. was actually one of the last countries to launch unusually. In Japan and Europe, particularly Germany, we are seeing a reversal of the trend of switching to oral therapy and some movement back to SPINRAZA. It is still early, and as Alisha said, it is largely people moving from the lower dose to the high-dose. But across markets, when I speak with physicians around the world, efficacy in these devastating diseases really matters, and there is an enhanced opportunity here.
Thank you. Let's go to the next question, please.
We will go next to Umer Raffat with Evercore.
Great. Thanks for taking my question. I want to touch on expectations ahead of your lupus readouts this fall. Specifically, we've seen Benlysta track at mid-teens separation on SRI and SAPHNELO at something in the 20s. Based on your work, what separation versus placebo would constitute something clinically meaningful and differentiated versus what's out there today? Priya, could you also remind us what dose of your BTK inhibitor is going forward? I'm thinking about liver implications, but I'd love to know the dose. Thank you.
Thanks. I will take that. We are excited about our TOPAZ trials—TOPAZ-1 and TOPAZ-2—with results from both expected in Q4 this year. We've taken learnings from prior trials to set these up appropriately, addressing high placebo responses seen in past trials by limiting standard-of-care utilization, such as NSAIDs and corticosteroid tapers, and by handling data for responders and nonresponders carefully. We also worked to control for heterogeneity by modeling inclusion/exclusion criteria to track closely to the Phase II LILAC proof-of-concept. We remain confident in our trial design, site selection, and patient selection to achieve a robust response. I will not speculate on a specific numerical separation versus placebo; our primary endpoint is SRI-4, and we have a key secondary endpoint in BICLA plus multiple patient-reported outcomes. We will evaluate the totality of the data, including interferon signature analyses. Mechanistically, we believe litifilimab is differentiated: it affects the interferon pathway and also chemokines and cytokines, which we think will provide benefit. For CLE, we expect data next year and will present 52-week data at EADV this fall, which we believe will inform durability of response. Regarding the BTK inhibitor, we have not disclosed doses, so I won't share more on that. We are evaluating next steps and remain disciplined in advancing assets given competitive dynamics.
Alisha, from the market perspective—because success is not one thing—there's steroid-sparing and endpoints like SRI-4, but in clinical practice fatigue is consistently cited by patients as a major unmet need. Real-world evidence will play a role. Alisha, could you add some comments on what it will take commercially?
Hi, Umer. We have recruited several senior leaders with lupus experience, built a medical team and marketing leaders with lupus expertise, and gained insights that go beyond third-party market research. Clinician-patient expectations often differ: physicians tend to focus on labs, while patients emphasize fatigue, brain fog, and joint pain. In CLE, fewer than 5% of patients receive an advanced therapy and prevalence may be undercounted; the 75,000 figure is likely an underestimate. Patients can get lost moving between dermatology and rheumatology. Existing treatments have drawbacks: one doesn't work quickly or well, another has infection safety issues. Physicians are looking for treatments that act more rapidly and can work in both CLE and SLE. There's a long runway for this therapeutic area. Because most patients are diagnosed, we can track them in the system and identify which physicians manage them. Despite the work required, this looks to be a strong therapeutic area to enter.
Go to the next question, please.
We will go next to Marc Goodman with Leerink Partners.
Yes. Can you give us a little more insight on SYFOVRE and what's happening behind the scenes—new patient starts, durability of patients, etc.? We understand injections were up 13%, but we're trying to understand what's driving that and what kind of growth we should expect from here. Thanks.
Thank you. Since integrating SYFOVRE and Empaveli, I've been impressed and grateful for the talent that joined from the SYFOVRE team. We found the original launch plans were similar to other companies' templated approaches. Having launched seven products over the last seven years, we tailor launch plans from the ground up based on what drives sales and where to reallocate capital. I'm encouraged by SYFOVRE's strongest quarter since launch and the best month in the brand's history in June. We're seeing quality growth across several areas. First, our free drug utilization has been lowered by half after putting guardrails in place to ensure only patients who need free drug receive it. That has contributed to momentum. Second, sentiment among HCPs toward SYFOVRE's ability to slow progression of geographic atrophy has improved dramatically due to strong data and the team's education efforts, which is driving new prescribers and more patients starting treatment. Long-term data and education around progression are helping. The market is underpenetrated: only about 50% of retina specialists are treating and only 20% of patients are diagnosed. We plan a direct-to-consumer campaign timed for market readiness and expect a prefilled syringe launch to support physician workflow—saving about 15 minutes per injection and increasing efficiency. Previously, our diligence showed a disconnect where many patients appear to discontinue after one year, but we now see most discontinuations happen after the first injection. We've handled similar early discontinuation issues in other brands and know what to do: support education for patients and physicians so they do not disconnect after the first injection. HCP growth is trending well and we will continue to educate patients and drive activation through DTC.
Let's go to the next question, please.
We will go next to Salveen Richter with Goldman Sachs.
Thank you. Good morning. Circling back on your BTK inhibitor, BIIB091: could you speak to how you expect this asset to be differentiated versus later-stage assets under development, and how you're thinking about safety given what has been seen? Thank you.
Thank you. We took BIIB091, a peripheral, noncovalent BTK inhibitor, into a Phase 2 trial in RRMS a few years ago. We concluded the trial and see potentially compelling efficacy in RRMS. However, RRMS is a very crowded market, and we are evaluating next steps given the competitive landscape and external inflections in the BTK space. We have not decided to advance it into a specific indication yet; we are still evaluating the data. This illustrates our prioritization approach: we consider both scientific data and the value opportunity in terms of market and capital allocation. We are taking a pause to assess how and if we advance BIIB091 beyond its current status.
Thank you. Let's go to the next question, please, Jess.
We will go next to Michael Yee with UBS.
Thanks. Back to litifilimab in CLE: do you believe CLE has a higher probability of success given perhaps less heterogeneity than SLE? You mentioned risks in SLE like heterogeneity and placebo rates. Could you comment on CLE versus SLE and the data you might present at EADV that could increase confidence? Thanks.
Stepping back, I do not see a difference in probability of success between SLE and CLE. I remain confident in the LILAC Phase 2 proof-of-concept data, which was compelling. Although LILAC tested SLE patients, it was enriched for the population where we expect litifilimab to have the strongest effect. We focused our SLE trials on patients with skin and joint involvement, which is why we remain confident in trial setup and probability of success. For CLE, we are also confident based on the focus on skin and the data generated so far. For SLE we have two Phase 3 trials due to the broad indication; CLE is a Phase 2/3 seamless AMETHYST trial, which allowed us to present Phase 2 randomized controlled data earlier this year and now present 52-week data at EADV to inform durability of response. We remain confident in all three trials. This is an undertreated area: very few biologics have penetrated the CLE market, and we believe the right mechanism of action can meet a high unmet need.
Go to the next question, please.
We will go next to David Amsellem with Piper Sandler.
On Empaveli, I noticed you are initiating a Phase 2 in FSGS. Broadly, how wide will development be given its C3 inhibition mechanism, and how are you thinking about other potential indications beyond FSGS? Second, can you comment on your anti-CD40 ligand that is Phase 1 ready and how it is mechanistically different from dapirolizumab that's running a Phase 3 in Sjogren's? Thank you.
I'll start with Empaveli. We're excited to bring in Empaveli with its nephrology and PNH indications. The legacy Apellis team had been working across indications. Two nephrology trials were being considered: delayed graft function, which we've paused, and FSGS, which we believe is an important indication. FSGS has high unmet need, clarity on a primary endpoint, a regulatory path, and biological rationale for Empaveli's impact on the C3/C3b cleavage pathway to affect autoantibodies. We have real-world data and murine models showing elevated C3. We will prosecute FSGS as a Phase 2 proof-of-concept and could have data in short order once initiated. The legacy team has already sought FDA feedback, so the program comes with a supportive regulatory package. We'll look across diseases where C3 plays a significant role. We also consider the value proposition and addressable market—for example, FSGS has about 27,000 patients in the U.S. We'll run a decision-enabling trial. Regarding the anti-CD40 ligand, we remain excited about the pathway and think it could be differentiated in autoimmune disease. We have not shared detailed mechanistic differences publicly yet, but we will communicate more at the appropriate time.
Jess, could we go to the next question, please?
We will go next to Alex Hammond with Wolfe Research.
Thanks. A few weeks after presenting the CELIA-AD data at AAIC, what feedback have you received from the medical and regulatory community? Has any feedback shifted your thinking for Phase 3 design, particularly regarding early combination with anti-beta antibodies? Thank you.
BIIB080/dirinersen is part of Biogen's longer-term story. The Phase 2 was exploratory, aimed at determining whether reducing tau could move cognition—tau has been a theory, and this is the first time any data have shown such a link. After the data, we had an independent biostatistician and external experts review it before the announcement, and we presented at AAIC. Strong feedback indicates the signal is real and not due to chance. There has been analysis and discussion about dosing; hypotheses include tau's role in neurotransmission and whether reducing it too much might be detrimental. This is the nature of breakthrough science: exciting but high-risk, high-reward. We decided not to build the company solely around such a program. We're investigating and discussing with the neurology community and will consult with the FDA. We have long-term extension data coming and will share when appropriate. This is a long-term investment: we are confident in the signal but Phase 3 is required, and it is unlikely to affect Biogen's growth in the current decade. That is what we can say about BIIB080/dirinersen at this stage.
Thank you. Let's go to the next question, please.
We will go next to Brian Abrahams with RBC Capital Markets.
Good morning. Congrats on the solid quarter. On subcutaneous LEQEMBI induction, what has initial demand or interest looked like compared to your expectations, and what are your latest views on access dynamics and potential timelines? Thanks.
I'll take that. Earlier this month we received approval for LEQEMBI IQLIK for induction; it will be available by the end of August. Our field teams are trained and educating HCPs about expected availability next month. We've already had some demand—physicians have written scripts that are in the queue—but we won't count that until the product is readily available in the market. Eisai is working to make access easy and is negotiating with payers on Part D access, and we'll learn more in several months about initial coverage. Even if some Part D plans don't contract for LEQEMBI, the alternative route has been medical exceptions. Medical exception grant rates have been quite high historically for this class of therapy, meaning physicians can often secure treatment for patients. It remains to be seen what happens starting January 1 next year for coverage; even with Part D plan coverage, a prior authorization is required, or a medical exception form, so physicians will still have to complete paperwork. Market research indicates IQLIK will evolve the market and contribute to growth once it gains traction. Also note many protocols for LEQEMBI were written for IV, so IDNs, hospitals, and systems are rewriting protocols to incorporate IQLIK into workflow. Drop-off rates occur at many points in the patient journey; one significant drop-off happens when patients are offered IV—they may decline IV treatment. Market research shows those patients would opt for subcutaneous dosing, which we believe will accelerate the market.
Go to our next question, please.
We will go next to Paul Matteis with Stifel.
Great. Good morning. How are you thinking about the brain shuttle space right now? As you invest significantly in building the Alzheimer's market, do you feel Biogen needs a brain shuttle to capture peak sales potential of anti-A-beta therapies? If so, what's the best way to get there? Thank you.
It's an important area that predates recent data readouts. We are working internally and looking externally on shuttle delivery and tissue delivery modalities. We're deep in this area and remain very interested in tissue delivery modalities across several targets. This is a high priority for us.
Longer term, Alzheimer's will be a core part of Biogen's portfolio, especially if BIIB080/dirinersen ultimately advances—subject to Phase 3. Clinicians will treat based on moving cognition. We are considering a portfolio approach: for example, combining an A-beta with an anti-tau, or using an anti-A-beta to maintain effects after a limited anti-tau course. These are strategic possibilities we are war-gaming. Brain shuttles would be a next-generation advancement and we've been working on them for several years, as Priya noted.
We might try to squeeze two last ones in. Could we go to the next one, please, Jess?
We will go next to Evan Seigerman with BMO Capital Markets.
Christopher, you mentioned felzartamab in AMR could be a $2 billion opportunity. What do you think investors need to see to be convinced of that, and what could you show us when we get the data next year? Thank you.
When we did diligence on Apellis, some assets' values were underappreciated. People often place placeholder values and wait for data. AMR has no approved product today and about 11,000 patients in the U.S. If you assume pricing in the range of recent rare nephrology pricing—Otsuka's IgAN price as an example—it can equate to a multi-billion dollar market. Phase 2 data showed high rates of resolution of AMR in a small open-label study; Phase 3 must confirm it. For patients, current options are limited: felzartamab could potentially avoid repeat transplants. In settings like Brazil, many transplant patients on waiting lists are patients who've already had transplants. There is a huge unmet need. The mechanism addresses plasma cells via anti-CD38, and the initial data are promising, so we have high hopes for this product.
Let's go to our last question, please, Jess.
We will go to Terence Flynn with Morgan Stanley.
Maybe a follow-up on TRANSCEND. Can you remind us of the powering on the primary endpoint and what is required from the FDA to support approval in late AMR? How should we think about lateral implications from TRANSCEND for microvascular inflammation? Thanks.
We have not commented publicly on specific powering details, but we believe TRANSCEND has a robust trial design and adequate power to give confidence in the outcome. TRANSCEND is a six-month, placebo-controlled, biopsy-driven trial with patients moving to maintenance for the next six months. Both the six-month endpoint and durability are important. We've been able to accelerate the trial and expect data in the first half of 2027. Microvascular inflammation (MVI) is a recently emphasized diagnostic category under the Banff criteria; these are donor-specific antibody-negative patients and represent an important population. We initiated the MVI trial as soon as possible; it is not the TRANSCEND trial and is already underway. We expect data from that program as well. We believe felzartamab's mechanism of addressing plasma cells via anti-CD38 will have impacts in both MVI and AMR. MVI in the U.S. is a sizable population—about 6,000 patients—so it represents an important opportunity and we are confident in the trial design and probability of success.
Thanks, everybody, for joining us today. If you have follow-ups, you know where to find us. Take care.
Thank you. Ladies and gentlemen, that will conclude today's call. We thank you for your participation. You may disconnect at this time.