Ipsen S.A. ($IPN)

Hello and welcome to Ipsen's Conference Call and Webcast on Q1 2026 Results. I'll now hand you over to David Loew, Ipsen, CEO.

Thank you, operator, and hello, everyone. I'm pleased to welcome you this afternoon to our Q1 sales presentation, which can also be found on ipsen.com. Please turn to Slide 2. Please take note of our forward-looking statements, which outlines the routine risks and uncertainties contained within this presentation. Also, all of my comments on growth will be based on constant exchange rates. Please turn to Slide 3. I'm going to take you through our first quarter sales performance and provide you with a business update, after which our CFO, Aymeric Le Chatelier will join me for the Q&A session. Let's begin by taking a look at today's highlights. Please turn to Slide 4. We delivered a strong top line growth in Q1. Total sales grew by 22.6% this quarter, driven by all 3 therapeutic areas. We are pleased to see the very strong performance of our portfolio outside Somatuline, which grew by 27.5% in the 3-month period. Based on this continued solid momentum and strong growth, we confirm our 2026 guidance with total sales growth greater than 13% at constant exchange rates, and the core operating margin greater than 35% of sales. Turning to the pipeline. We were delighted to announce the approval of Agenda following the positive CHMP opinion in the European Union as the first targeted therapy in relapsed or refractory pediatric low-grade glioma regardless of BRAF alteration. Looking ahead, 2026 promises to be an exciting year for our pipeline with several key milestones, including 3 pivotal Phase III readouts expected in H2 2026, as well as the launch of 3 late-stage programs starting this year. Please turn to Slide 5. Our Q1 sales delivered solid 22.6% growth, fueled by all 3 therapeutic areas. The portfolio outside of Somatuline grew by 27.5% in the quarter. Oncology performed well with sales up 13%, driven by the strong performance of all products. Rare disease continues to stand out, propelled by the sustained performance of Accorvo and Bellway. Neuroscience with this board delivered 18.5% growth this quarter. I'll now turn to oncology for more detail. Please turn to Slide 6. Starting with Somatuline sales were up by 12.8% in Q1, both the U.S. and Europe continues to benefit from shortages of generic lanreotide in addition to a solid performance in Rest of the World. We do anticipate lanreotide generic competition to resume in H2 2026. CABOMETYX sales were up by 16.4% with solid performance in Europe and in Rest of the World. NET launch in Europe continues to progress with additional launches planned this year. The capacity sales were up by 8.4% as we experienced volume growth in Europe and China, despite continued competition and some pricing pressure in some countries. Now let's turn to rare disease. Please turn to Slide 7. In rare disease, Acorvo continued to track very well with sales reaching EUR 79 million this quarter. In Q1, we continue to see strong growth in the U.S. We believe that the switching of Ocaliva patients on to PPARs has now happened and took place mostly during Q4 last year. On the European side, we observed a sustained momentum with more countries coming online and further reimbursements achieved. Turning to [indiscernible]. We continue to perform well with Q1 sales of EUR 61 million, growing by 51.5% and driven by strong demand in the U.S. in addition to Europe and some rest of world countries such as Japan, where we recently opened a new affiliates. We're also starting to see benefits as the dedicated field force comes fully online in the U.S. Moving to neuroscience. Let's turn to Slide 8. The Dysport performed very well in aesthetics this quarter with sales up 24.3%. We have seen continued growth in most territories augmented by share gains in some countries. European markets have remained robust. The good performance includes positive phasing of shipments in the rest of the world. In therapeutics, Dysport sales grew by 10.5%, driven by both Europe and the U.S. This concludes the review of sales. Now let's turn to the pipeline. Please turn to Slide 9. We have a well-balanced pipeline across the 3 therapeutic areas. I will cover the late-stage assets shortly, but you can see we are building an early to mid-stage pipeline, including several Phase I oncology assets and an extensive program across both aesthetics and therapeutics for our long-acting recombinant molecule IPN10200 now known by its generic name [indiscernible]. Please turn to Slide 10. Now I will provide more detail on the key results expected in the second half of this year. We have pivotal Phase III readouts for Dysport in chronic and episodic migraine, equal in the less severe PBC patients, [indiscernible], and lastly, further data from our Phase II LANTIC trial for corabotes in 2 additional aesthetic indications of 4 headlines and lateral cancel lines. Please turn to Slide 11. We're excited to be starting 3 late-stage trials with a view to registration. Following the acquisition of ImCheck Therapeutics last year, we're initiating activities for the Phase IIb/III trial in frontline unfit AML. For accrual, following encouraging Phase II data in PSE, we have initiated a Phase III trial. Given it is a long-term [indiscernible] study, we anticipate the readout in 3 to 4 years. Finally, for the long-acting recombinant molecule corabotase following last year's proof-of-concept data, we have started the Phase III program in glabeloline with patients enrolling quickly. The data from the Stage 1 of the Phase II LANTIC trial in glabeloline will be presented at the SCALE Symposium in Nashville in May. I would now like to conclude. [indiscernible] delivered a strong start to 2026. We are on track to build further momentum in our transformation and to achieve our objectives for the year. Our top line continues to deliver driven by the launches and continued portfolio performance. We're increasing our investment in our launches and our preparations for upcoming launches as we advanced our pipeline. To further strengthen our pipeline, we will continue to diligently evaluate external innovations, leveraging our increasing firepower with priorities unchanged. With that, please turn to Slide 13. This concludes our presentation, and we will now take your questions. Operator, over to you.

[Operator Instructions] And your first question today comes from the line of Yihan Li from Barclays.

Congrats on the quarter. Yihan Li from Barclays. So I guess I have 3 questions, if I may. So the first one is to [indiscernible] business. So we saw it as a very strong quarter. So could you please help us to understand how much of that was onetime in nature versus a most sustainable improvement in the base business and with this performance improving across a number of projects, so what makes you cautious on potentially reaching the guidance at this stage? And my next question is on Cabometyx, the IP -- so could you please help us to understand how much the strategic flexibility, which has on the future commercialization asthenic, or more broadly, how should we think about the options to maximize the value of assets? Is that still possible to collaborate with other companies other than your current [indiscernible] partner? And the last one, I just wanted to clarify on the timing of rIqirvo Phase III data readout in the second half we saw the primary completion in June. So just curious, are we going to potentially see the data in the third quarter?

Okay. Yihan, thanks a lot. On Somatuline, we indeed had a strong quarter. This was driven by, of course, the stock outs of the generics -- now this allowed us to recapture market share volume, obviously, through market share, but also price. So there is your question on, okay, how much is this a onetime versus sustainable lift. I think we have guided the market to say we expect around Q3, Q4 generics to come back. We know that [indiscernible] yesterday, that they plan to intend to launch in Q3. I just want to remind everybody, it's a really hard to produce product. You have seen that over the past years, several of the generic producers were struggling. So we have to see how this is going to develop. And so therefore, we are a bit cautious on raising the guidance right now. So you will have to just be a bit patient and we have to observe what's going to happen and that might influence what we're going to tell the market. On the corabotase, we have strategic flexibility. The arbitration was clear. We fully own the product. We are not going to elaborate now on what we are going to do in terms of partnering or not. I just want to remind you that we're also still in those filings in some of the indication in aesthetics with FHL and LCL, as I said, where we're going to show results towards the end of the year. And then also in the therapeutic space, we also have still the dose finding. And your third question on Iqirvo in Phase III, so we are going to unblind this summer. Indeed, as you say, we assume that we would submit the data to AASLD, which is, I think, in Q4, if I recall it right, in November. So you will probably see a press release when we unblind and then you're going to see the data towards the end of the year. Thank you.

So I just wanted to clarify on my first question. I think I was asking about the business upside of Somatuline. So what is the onetime nature versus sustainable improvement?

When you have an increase in sales, and we have seen that the market is growing. We have taken back market share. Of course, if you get affected by generics, that will have that effect of the lift that you come from a higher level will have a carryforward effect we have to assume. So there's partially -- there is a carryforward on this beneficial effect. Next question?

Your next question comes from the line of Xian Deng from UBS.

Okay. Could you hear me now?

Yes, we can hear you.

Xian Deng from UBS. So two, please. So first, both on Bylvay. So first one is Bylvay did really, really well this quarter with EUR [ 16 ] million growth from Q4 2025. So just wondering, is this rate of growth, something that we can expect for the rest of the year? Or do you think this will more sort of stabilize a bit? And then the second one is the Phase III readout of Bylvay in BA. So just wondering if you could comment on your thoughts on the probability of success and commercial opportunity here, that would be great. Sorry, if I can maybe just squeeze one in quickly, kind of a follow-up from the previous question. So the Decapeptyl and Dysport, you got a bit of positive phasing for Q1. Just wondering if you could maybe quantify the size of positive phasing, please.

Thank you, Xian. So on Bylvay growth, we are very pleased, obviously, with the dynamic as you have heard us say -- we have a dedicated field force that we have put in place in September last year. So the rollout started. And so clearly, it does have an effect. Now it's a bit early days to say, okay, is that going to totally change the trajectory or there are a bit of a catch-up on some of the patients. So we -- I think we have to observe that, but we are definitely very pleased with the dynamic of the drug. On the Phase III on biliary atresia. I mean, as you know, the hurdle is relatively high on biliary atresia because we have a very hard endpoint on liver transplant. And so therefore, we will have to see the children need to have a Kasai procedure sometimes deliver functions properly after this high procedure. Sometimes it doesn't fully function. So this is also why the hurdle on BA is relatively high. The commercial opportunity that we have guided is about as big as PFIC and allergies together. So it's a significant upside if we hit it. And then on your third question on the Decapeptyl and this word phasing, I'll let Aymeric comment.

Yes. So thank you, David. Thank you for the question. Yes, it is true to [indiscernible] that the performance of Decapeptyl, as you can see, has been boosted especially in Rest of the World by some extra shipment, especially related to supplying the Middle East market. So I think you should not expect the Rest of the World to continue to grow at a very strong double-digit, while at the same time, the product is doing very well, including in China. Regarding Dysport, you have the same effect on the aesthetic sales where you see that we are growing by 35%, this is also based on very high level of shipments for the quarter. Having said that, we also are very happy with the performance, both of Galderma and on the Ipsen territory for also the world of Dysport.

Thank you. Operator, next question, please.

Your next question comes from the line of Sofia Graeff Buhl-Nielsen from JPMorgan.

Could you talk about how you see the growth potential at iuvo going forward now the impact of the Ocaliva withdrawal is largely behind us? In the second half. We have the Phase III SBIA study in second-line PBC patients with lower ALP coming up? Just how are you thinking about the market expansion opportunity for this and the potential for [indiscernible] from this trial? Is there any use of the product already in these patients? And then just also any additional color you could share in terms of market share developments to [indiscernible] in Europe would be great.

Okay. Thank you, Sofia. So taking your first question on [indiscernible]. What's going to be the dynamic now that Ocaliva withdrawal has basically washed out. So what you have observed is that we had a very nice growth in Q1 to mid -- let's say, middle of Q3. And then Ocaliva was with Crown and Q4 was a notable significant acceleration. So what you should think of looking forward now is that the growth which we are going to see from, let's say, Q2 to Q4 is going to be probably around the speed that you have seen at Q1 to Q3 last year because this jump that we have done on Q4 has lifted up on the next level on a much higher level. And of course, we're going to continue growing on this higher level. So that is probably how you need to think about it. And then comes on top of it the unblinding of else buyer. So what I was just saying on the growth rate was just relating to the above 1.67. Now if you now assume that we would have a positive readout of [indiscernible] in the below 1.67, that would give an additional lift. Just to give you a bit of an idea in terms of the size of the pools that we have in these different populations. So when you take the U.S., PBC overall are about 100,000 patients, out of which in second line then in the above 1.67, we estimate to have about 30,000 patients and in the below 1.67, you have about 20,000 patients. So it's a sizable business opportunity adding to the 30,000 where we can be used 20,000 on top of it. Now some of those are potentially not going to be eligible because they're very close to 1, but there is a good part of the patients that are eligible there, and they also sometimes have symptoms despite being below 1.67. And it therefore constitutes a clear market expansion opportunity. We do see and we estimate that on our current sales, we have about 20% of the scripts coming from the below 1.67 already. So there is already some news there. So the [indiscernible] trial is really going to turbo-boost the penetration in the below 1.67 because it's going to add data to help you, we don't need to wait until we would have a label update because the label is actually not restricted to the above 1.67. So this is why you see already some use in the below 1.67 despite the fact that the [indiscernible] didn't have data yet, both companies are going to show data, and that's probably going to significantly enlarge the market because with data in hand, physicians are probably going to increase the use in a significant manner in the below 1.67. And then to the market share question, if I understood you right, this word, the [indiscernible] let Aymeric answer.

Yes. So thank you, David. So regarding the question on market share, I think you should ask our partner Galderma. We are not commenting on market share. What you can see is that we are very pleased with the performance of sport in aesthetic in Europe, growing by 9.5% this quarter, and we expect that to continue for the year.

Your next question comes from the line of Victor Floch for BNP Paribas.

Victor Floch, BNP Paribas. Maybe first one on [indiscernible], I think in the past, you've recently pointing out to a base case LOE around 2031. But if I'm not mistaken, there is a large family of patents that could explain the IP protection of [indiscernible]. So any chance you could discuss the different options you have and whether we could expect promoted on this at some point? And my second question is on Somatuline. So I think from [indiscernible] yesterday that they were actually asked the FDA to accelerate the review of their signing. So just wondering whether you think that the Q3 is still a reasonable timing for potential entry? And also whether we should assume that the long-term contracting that you have in the U.S. should also be helpful when it comes to protect your market share in this market.

Thank you, Victor. So on Acervo, as you have seen from our UDR document, we have the base patent expiring in 2031, but there are method of use patents, which indeed can go significantly longer. So we are not expressing ourselves as a company on what our assumption is. I think you have to make your own decisions here. What I can say in addition is that if we would hit it in primary sclerosing cholangitis, we would launch the drug, elafibranor under a different brand name, given that it's a different dosing -- and given that the tablets are not split tablets, we assume that the generics are not going to penetrate there on PSC and we have orphan drug protection so you would have an additional 7 years on top of this for the PSC indication. Then on Somatuline, I mean, [indiscernible] asking FDA to accelerate. You have seen the FDA stating that they want to accelerate some drugs, but I don't think that they talked about generics. I mean they have talked about some real breakthrough drugs. Like when you have massive overall survival benefit with the new drug, et cetera. I mean, that was basically the discussion. So I would certainly not assume that they would come anytime earlier than what they have said. They have also a little bit of a track record of having delays. As you know, I mean, they gave originally the date of Q1, then they pushed it out to Q2. And then they said in Q2, now it's Q3. So let's see what's going to happen there. To your question then on the long-term contracts, I mean, of course, we're not going to comment on what our strategy is. So you have to make your assumptions here yourself. Thank you.

[Operator Instructions] And the next question comes from the line of Charlie Haywood from Bank of America.

Charlie Haywood with Bank of America. I have 3 questions, please. So the first is just on the potential to commercialize IPN10200 alone, which I know is an option for you and obviously would be a significant strategic decision. So if you were to go it alone, how do you think about your ability to compete commercially and the feasibility of scaling up that sales force? And then any sort of magnitude or phasing of costs to ramp that up. Second question on sort of Galderma, recent commentary post the arbitration, there looks to be a slight sort of discrepancy and who has the rights to the commercialization. I guess any color on that from your side or if it's been clarified with the party? And would there be a potential need for another arbitration down the line to resolve that issue? And then third question, if we only see one [indiscernible] generic in '27 and let's say we assume it's Amneal, how should we broadly think about the [indiscernible] outlook for '27? It feels like 1 generic would not be your sort of mid-teens 20% annual decline needed for 2 to 3 generics. So is that close to sort of flat to slight decline. Is that fair? Or how should we think of a good proxy there?

Okay. So I start with your first question on IPN10200, which we now call corabotase. So it has a generic name. We don't need to remember any fancy figures anymore. So it's corabotase. And on our go-to-market strategy, I mean, we're evaluating all scenarios. So we're not going to comment on what we are going to do. So as I said, we are also still in the dose finding on some of the aesthetic indications, but also on the therapeutic indications, and we also want to see more data. Of course, we could choose to invest ourselves. I mean we have what is needed. But as I said, I mean, this is something that we have to carefully evaluate in the light of what I just said before. Regarding the legal statements, I do not comment on legal statements from Galderma. What I can tell you is that the arbitration was very clear, we have full rights on corabotase ourselves. And then on the third one, I hand over to Aymeric.

Yes. So -- thank you, David. So regarding the potential impact if there were to be only 1 generic to launch by the end of this year, I think you should anticipate that there will be an impact on 2027, especially given the very strong baseline for 2026. Having said that, we're not going to provide the guidance today. Just reminding you that only 1 generic will be a progressive erosion as we characterize it in the past. It's only if we see more than 1 that we see a potentially more accelerated erosion for [indiscernible]. So let's wait and see what's happened, as David said, regarding first generic to be able to launch because this is still a challenging space for companies to manufacture and to secure approval, both in the U.S. and also outside the U.S.

Let's perhaps just to add something to remember. It's an auto gel, which needs to have the right viscosity if it's too viscous, you can't push it through the syringe. If it's not viscous enough, you have leaky arranges and we have also observed that some of the generic producer had some air bubbles in there, et cetera. So the yields that you get and the compliance of the product, et cetera, the quality controls that we need to do has been an issue as testimonied by the several 483s and then OAI. So Pharma 10 got an OAI and some pharma as well. So it's not really an easy product to produce. The next question.

Your next question comes from the line of Simon Baker from Rothschild & Co.

This is [indiscernible] speaking for Simon. I have 2 questions. The first one is on Bylvay. So is the Velvet sales force change complete? Or is there more to come? And my second question is on the 10200. So what's the overall appetite for the long-acting toxin based on your discussion with prescribers and does that differ from -- between aesthetics and therapeutics?

Okay. I didn't quite get your second question. Can you just repeat this?

Yes, yes, sure. No problem. So regarding the 10200, what's the overall appetite for the long-acting toxin based on your discussion with prescribers, and does that differ between the aesthetics and theapeutics?

Okay. Yes. Great. Thank you. Okay. So on Bylvay, yes, I can say the field force implementation is complete. So they have been deployed last autumn. So now they're going at the field and we clearly see the first effect. So we're very pleased with that. On 10200, as I said, it's called chores now. We see a very, very high interest for that drug on both the aesthetics and the therapeutic. As I said, we have started the Phase III glabeloline trial, and it's recruiting extremely fast. The investigators are enthusiastic and you're going to see the data at the conference in May. We're probably also going to have an IR event at that time. And the same feedback we're getting in the therapeutics. I mean that's a real game changer in therapeutics because -- for example, if you're a migraine patient or cervical dystonia or specificity patient, if you do only inject every 6 months instead of every 3 months, that makes a massive difference; a, for the patients; b, for the physician because there are not that many physicians which know how to inject. It requires very specific know-how how to inject. It's complex to get trained and to do this procedure. So it's going to unlock a lot of additional capacity in the health care system, and it's going to make the health care system more effective. So for payers, this is also a very interesting new option. So I think this can be a drug, which is really significantly changing its if everything works out as we want to. So I'm very, very excited about this drug. And I think, operator, that was our last question, correct?

That is correct. Back to you now.

Okay. That wraps up our Q1 results conference. Thank you for having participated. Bye-bye.

Thank you. This concludes today's conference call. Thanks for participating. You may now disconnect.