Sign in

You're signed outSign in or to get full access.

AP

Alkermes plc. (ALKS)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $306.5M and GAAP diluted EPS was $0.13; proprietary net sales rose to $244.5M while manufacturing/royalty revenue stepped down as expected, and management reiterated full-year 2025 guidance .
  • The quarter came in slightly ahead of internal expectations; versus S&P Global consensus, revenue modestly beat and Primary EPS beat (see Estimates Context) .
  • Commercial highlights: LYBALVI revenue grew 23% YoY on 22% TRx growth; VIVITROL revenue reached $101.0M, with ~75% volume from alcohol dependence; ARISTADA net sales were $73.5M .
  • R&D momentum: Vibrance-1 (NT1) fully enrolled with top-line data expected early Q3; Vibrance-2 (NT2) enrollment expected to complete mid-year with fall data; Vibrance-3 (IH) initiated on Apr 1; Phase 3 preparations underway .
  • Balance sheet remains strong with $916.2M cash and investments; management may opportunistically repurchase shares under the remaining $200M authorization .

What Went Well and What Went Wrong

What Went Well

  • “Our first quarter commercial performance was solid and slightly ahead of the expectations that we provided on our last earnings call” .
  • LYBALVI delivered 23% YoY revenue growth to $70.0M on 22% TRx growth across schizophrenia and bipolar I disorder, with gross-to-net at ~31% in Q1 and expected low-to-mid 30% range for the year .
  • Vibrance-1 (NT1) is fully enrolled; top-line results expected early Q3, with broad Phase 2 momentum and Phase 3 prep including >45 sites and manufacturing/operational readiness .

What Went Wrong

  • Total revenue declined YoY to $306.5M from $350.4M, primarily reflecting a step-down in manufacturing and royalty revenues (including long-acting INVEGA royalties) versus prior-year levels .
  • ARISTADA net sales fell to $73.5M from $78.9M YoY; adjusted EBITDA declined to $45.6M from $81.8M YoY, consistent with expected royalty/manufacturing normalization and higher R&D investment .
  • Analysts probed safety signals (visual disturbances) in orexin programs; management emphasized DSMB oversight, baseline and follow-up ophthalmologic exams, and the need to await Phase 2 data for definitive exposure–AE characterization .

Financial Results

Headline metrics vs prior quarters

MetricQ3 2024Q4 2024Q1 2025
Total Revenues ($USD Millions)$378.1 $430.0 $306.5
GAAP Diluted EPS ($USD)$0.55 $0.88 $0.13
Operating Income ($USD Millions)$104.8 $162.7 $13.8
EBITDA ($USD Millions)$111.8 $171.1 $22.8

Segment and revenue composition

MetricQ4 2024Q1 2025
Total Proprietary Net Sales ($USD Millions)$307.7 $244.5
VIVITROL ($USD Millions)$134.1 $101.0
ARISTADA ($USD Millions)$96.6 $73.5
LYBALVI ($USD Millions)$77.0 $70.0
Manufacturing & Royalty Revenues ($USD Millions)$122.3 $62.0
VUMERITY manufacturing & royalty ($USD Millions)$35.0 $27.8
Long-acting INVEGA royalties ($USD Millions)$36.5 $17.7
RISPERDAL CONSTA manufacturing ($USD Millions)$14.7 ~$9.0
Total Revenues ($USD Millions)$430.0 $306.5

KPIs and operating line items

KPIQ4 2024Q1 2025
Cash, Cash Equivalents & Total Investments ($USD Millions)$824.8 $916.2
R&D Expense ($USD Millions)$58.2 $71.8
SG&A Expense ($USD Millions)$147.0 $171.7
Cost of Goods Manufactured & Sold ($USD Millions)$62.1 $49.2
Weighted Avg Diluted Shares (Millions)166.6 168.7
EBITDA ($USD Millions)$171.1 $22.8

Versus S&P Global Consensus (Q1 2025)

MetricConsensus Estimate*Actual
Revenue ($USD Millions)$304.1*$306.5
Primary EPS ($USD)$0.2448*$0.2910*

Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total RevenuesFY 2025$1.34B–$1.43B Reiterated Maintained
Proprietary Net SalesFY 2025$1.09B–$1.15B Reiterated Maintained
VIVITROL Net SalesFY 2025$440–$460M Reiterated Maintained
ARISTADA Net SalesFY 2025$335–$355M Reiterated Maintained
LYBALVI Net SalesFY 2025$320–$340M Reiterated Maintained
Cost of Goods SoldFY 2025$185–$205M Reiterated Maintained
R&D ExpensesFY 2025$305–$335M Reiterated Maintained
SG&A ExpensesFY 2025$655–$685M Reiterated Maintained
EBITDAFY 2025$215–$245M Reiterated Maintained
Adjusted EBITDAFY 2025$310–$340M Reiterated Maintained
Effective Tax RateFY 2025~17% Reiterated Maintained
Proprietary Net SalesQ2 2025—$260–$280M New intra-year color

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
Orexin 2 program (ALKS 2680)Phase 2 NT1/NT2 ongoing; IH Phase 2 planned for 2025 ; Robust Phase 2 design (80 pts/study), NT1/NT2 data in H2 2025; IH IND filed; foundational design toward registration NT1 fully enrolled; top-line early Q3; NT2 enrollment completes mid-year with fall data; IH Phase 2 initiated Apr 1; Phase 3 prep with >45 sites; once-daily, dose flexibility emphasized Accelerating
Sales force expansion & commercial executionPlan to add ~80 reps; expect contributions later in 2025 Psychiatry sales force expansion completed; expect tangible contributions within a few quarters; wholesale inventory normalized Increasing
Policy/macro (Medicaid, tariffs, FDA)Monitoring IRA/Medicaid; Part D exposure ~1% in 2025; advocate to protect access U.S.-based manufacturing; imported API <5% of COGS; tariffs immaterial; focus on Medicaid changes and FDA continuity Watchful, low direct impact
LYBALVI demand and gross-to-netAccess improvements; GTN to mid-30s; demand growth target ~25% Q1 GTN ~31%; expect low-to-mid 30% for remainder of 2025; TRx +22% YoY; $70.0M revenues Stable GTN, strong uptake
VIVITROL AD focus & generic dynamicsAD growth driving brand; mid-single digit demand growth expected ~$101.0M net sales; ~75% volume from AD; less reliance on government funding; planning for competitive entrant with atypical erosion curve Resilient

Management Commentary

  • “We are well positioned and we’re right on plan. Our first quarter commercial performance was solid and slightly ahead of the expectations that we provided on our last earnings call… and this morning, we reiterated our financial expectations for the year.” — Richard Pops .
  • “Investigators… are gaining experience… screening and enrollment accelerated significantly… Vibrance-1 is now fully enrolled… We expect to report top line data… early in the third quarter.” — Craig Hopkinson .
  • “All of our proprietary products are manufactured at our Ohio facility… We import a small amount of API… less than 5% of our cost of goods sold.” — Blair Jackson .
  • “For TRxs [LYBALVI], it’s roughly about a 50-50 split for schizophrenia and bipolar; for new patient starts… ~55% bipolar.” — Todd Nichols .
  • “We continue to have $200 million of remaining share repurchase authorization… may opportunistically repurchase shares dependent on market conditions.” — Blair Jackson .

Q&A Highlights

  • Orexin endpoints and dosing: Elevated Epworth to dual primary in NT2; flexible titration in open-label extensions for real-world dose selection .
  • Safety oversight: DSMB ongoing; baseline and follow-up ophthalmologic exams; no study modifications to date; visual disturbances to be more fully characterized with Phase 2 data .
  • LYBALVI positioning and competition: Mix ~50/50 schizophrenia/bipolar TRx; HCPs view Cobenfy more as adjunct therapy; LYBALVI trajectory supported by broad indications and expanding access .
  • Medicaid exposure and funding: Medicaid ~45–50% across VIVITROL, LYBALVI, ARISTADA; business less reliant on state/federal funding for VIVITROL; macro focus remains on protecting access .
  • Phase 3 timing: Plan to bring NT1/NT2 into end-of-Phase 2 FDA meeting promptly after data; multi-dose approach targeted for Phase 3 .

Estimates Context

  • The company modestly beat revenue consensus ($306.5M actual vs $304.1M estimate*) and beat Primary EPS ($0.291 actual vs $0.2448 estimate*). Values retrieved from S&P Global.
  • Given reiteration of FY25 guidance and stronger proprietary net sales trajectory, consensus models may need to reflect lower manufacturing/royalty baselines and sustained LYBALVI TRx growth with GTN in the low-to-mid 30% range .

Key Takeaways for Investors

  • Slight beat on revenue and Primary EPS with reiterated FY25 guidance reduces near-term estimate risk; commercial engine appears intact despite royalty normalization .
  • LYBALVI momentum (23% YoY revenue growth, 22% TRx growth) and completed sales force expansion support continued psychiatry franchise growth through 2H25 .
  • Orexin catalysts are the key stock drivers: NT1 top-line early Q3, NT2 in fall, and IH Phase 2 underway; Phase 3 preparation should enable rapid pivot on positive readouts .
  • Policy headwinds (Medicaid/tariffs) appear manageable given U.S. manufacturing and limited imported API exposure; monitoring remains prudent .
  • VIVITROL resilience anchored in alcohol dependence; management expects non-typical erosion curve upon potential generic entry, mitigating long-term downside .
  • Strong liquidity ($916.2M) and remaining $200M buyback authorization provide flexibility for opportunistic capital deployment and BD to broaden the neuroscience pipeline .
  • Near-term trading: stock likely to be sensitive to orexin safety/tolerability color and NT1 efficacy magnitude; medium-term thesis rests on psychiatry growth plus validated orexin platform progression .