• Total Sales Growth: 9.9% at constant exchange rates, exceeding EUR3.4 billion.
• Core Operating Margin: 32.6%.
• Core Operating Income: EUR1.1 billion, a growth of 10.8%.
• Free Cash Flow: EUR774 million, an increase of 8.9%.
• Revenue from Ex-Somatuline Portfolio: Grew by 12.2%.
• Cabometyx Sales: Increased by 13.3% for the full year.
• ONIVYDE Sales: Grew 23.7% for the full year.
• Fidrisertib Sales: Rose by 24%.
• Dysport Sales Growth: 9.2% for the full year.
• Bylvay Sales: EUR136 million.
• IQIRVO Sales: EUR22 million.
• R&D Costs: Increased by 10.9%, exceeding 20% of sales.
• SG&A Costs: Increased by 3.3%, with a ratio to sales at 34.4%.
• Net Cash Position: EUR160 million at the end of December.
• Dividend Increase: From EUR1.2 to EUR1.4 per share.

• Warning! GuruFocus has detected 4 Warning Signs with IPSEF.

Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ipsen SA (IPSEF) reported a 9.9% increase in total sales for 2024, driven by strong performance in their ex-somatuline portfolio.
• The company achieved a core operating margin of 32.6%, reflecting efficient cost management and strong sales performance.
• Ipsen SA (IPSEF) received a positive FDA decision for ONIVYDE in first-line pancreatic ductal adenocarcinoma, with subsequent approvals in the US and EU.
• The company anticipates significant pipeline milestones in 2025, including potential approvals for Cabometyx in neuroendocrine tumors and Tovorafenib in Europe.
• Ipsen SA (IPSEF) has a strong balance sheet with no debt and EUR 2.3 billion available for external innovation, indicating financial stability and capacity for growth.

Negative Points

• Ipsen SA (IPSEF) faces increased competition and pricing pressure for Cabometyx in Europe and China, impacting sales growth.
• The company recognized an impairment loss of EUR 281 million related to Sohonos due to lower-than-anticipated patient uptake.
• Somatuline is expected to face accelerated erosion due to increased generic competition, impacting profitability.
• The aesthetics market in the US is experiencing some softening, which could affect future growth prospects for Dysport.
• Ipsen SA (IPSEF) anticipates a contraction in core operating profit margin in 2025 due to increased R&D expenses and competitive pressures.

Q & A Highlights

Q: Could you provide more details on the expected erosion pattern for Somatuline in 2025 and the current state of generic competition in Europe and the US? A: David Loew, CEO: The erosion pattern for Somatuline is expected to accelerate compared to historical levels due to anticipated market entry by additional generics, likely around mid-year. In Europe and the US, we have seen significant shortages from existing generics, but we expect increased competition and accelerated erosion moving forward.

Q: Can you explain the drivers behind the expected margin contraction in 2025 and how it will phase between H1 and H2? A: Aymeric le Chatelier, CFO: The margin contraction is primarily due to increased erosion from Somatuline and continued investment in R&D and SG&A to support ongoing and future launches. H1 margins will be higher due to lower costs and less impact from generics, while H2 will see more erosion and investment, leading to lower margins.

Q: How is the launch of IQIRVO progressing, and what are the competitive dynamics in the market? A: David Loew, CEO: The IQIRVO launch is progressing well, with most patients being de novo second-line. We are seeing good feedback from prescribers despite competition from Gilead. We have increased our field force and presented new data on fatigue, which affects 80% of PBC patients.

Q: What is the current market share for ONIVYDE in first-line pancreatic cancer, and what is the potential for growth in the community setting? A: David Loew, CEO: ONIVYDE is used by 32% of large academic centers, with growth primarily from the first-line setting. The patient flow is about 50-50 between academic and community settings, indicating significant potential for growth in community practices.

Q: What are your expectations for the growth trajectory of IQIRVO in 2025, and how does it compare to Gilead's product? A: David Loew, CEO: We anticipate market expansion and are sticking to our peak sales guidance for IQIRVO. While we can't comment on Gilead's trajectory, we are pleased with our current uptake and expect continued growth.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.