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Apellis Pharmaceuticals, Inc. (APLS)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $212.5M, up 45% YoY, driven by SYFOVRE ($167.8M) and EMPAVELI ($23.4M); net loss narrowed to $36.4M vs $88.6M in Q4 2023 .
  • Management flagged Q1 2025 SYFOVRE net revenue will be lower than Q4 due to seasonal Medicare reverifications, winter storms, and a temporary spike in samples (~5,000 incremental vials), despite injections rising QoQ; gross-to-net expected to remain low–mid 20% through 2025 .
  • Strategic momentum: SYFOVRE maintained >60% injection market share with ~94k doses delivered in Q4 and is the only GA therapy with monthly or every-other-month dosing and preferred positioning at many payers; >2,300 sites have ordered SYFOVRE .
  • Rare disease optionality: sNDA submitted for EMPAVELI in C3G/IC‑MPGN with U.S. launch targeted for 2H 2025 if approved; Phase 3 programs in FSGS and DGF planned for 2H 2025; VALIANT showed a 68% proteinuria reduction and strong secondary endpoints .
  • Estimates: S&P Global consensus (revenue, EPS) could not be retrieved due to a daily limit error at request time; we cannot quantify beat/miss and will update once data is available.*

What Went Well and What Went Wrong

What Went Well

  • SYFOVRE leadership sustained: ~94,000 Q4 doses (≈89,000 commercial vials; 4,600 samples); total injection market share >60% and new patient share approaching 50% into year-end .
  • Durable demand indicators: cumulative SYFOVRE injections surpassed 510,000 through December; >2,300 sites have ordered; payer wins include preferred formulary status at sizable plans .
  • Rare nephrology pipeline de-risked: VALIANT met primary and key secondary endpoints (68% proteinuria reduction; eGFR stabilization; 71% zero C3c staining), broad across C3G/IC‑MPGN and transplant settings, supporting the sNDA and EU path via Sobi .

What Went Wrong

  • Near‑term revenue headwinds for Q1 2025: management guided Q1 below Q4 due to seasonality (Medicare reverifications, winter storms) and a temporary spike in samples linked to a funding gap at nonprofit co‑pay assistance organizations (≈5,000 incremental samples) .
  • Gross‑to‑net and ASP pressure: SYFOVRE gross‑to‑net guided to remain low–mid 20% in 2025; a 1% price increase took effect Jan 1 to offset ASP erosion .
  • International uncertainty in GA: EU path remains curtailed after prior negative CHMP; focus shifted to select ex‑U.S. markets (e.g., Australia approval, Switzerland review) .

Financial Results

MetricQ4 2023Q2 2024Q3 2024Q4 2024
Total Revenue ($M)$146.4 $199.7 $196.8 $212.5
Net Product Revenue – SYFOVRE ($M)$114.3 $154.6 $152.0 $167.8
Net Product Revenue – EMPAVELI ($M)$24.4 $24.5 $24.6 $23.4
Licensing & Other Revenue ($M)$7.7 $20.5 $20.3 $21.4
Cost of Sales ($M)$19.9 $23.1 $33.6 $40.9
Operating (Loss) ($M)$(84.5) $(29.4) $(47.3) $(26.2)
Net Loss ($M)$(88.6) $(37.7) $(57.4) $(36.4)
EPS (Basic & Diluted) ($)$(0.73) $(0.30) $(0.46) $(0.29)
Gross Margin % (calc)86.4% 88.4% 82.9% 80.8%
Operating Margin % (calc)(57.7%) (14.7%) (24.0%) (12.3%)
Net Margin % (calc)(60.5%) (18.8%) (29.2%) (17.1%)

Segment/product breakdown (quarterly):

Revenue Detail ($M)Q4 2023Q2 2024Q3 2024Q4 2024
SYFOVRE U.S. Net Product$114.3 $154.6 $152.0 $167.8
EMPAVELI U.S. Net Product$24.4 $24.5 $24.6 $23.4
Licensing & Other$7.7 $20.5 $20.3 $21.4
Total Revenue$146.4 $199.7 $196.8 $212.5

KPIs:

KPIQ2 2024Q3 2024Q4 2024
SYFOVRE doses delivered (k)~84.0 ~88.5 ~94.0
Cumulative SYFOVRE injections (k)>330 >420 >510
Sites of care ordering SYFOVRE>2,100 >2,200 >2,300
SYFOVRE market share (injections)—~65% >60%
New patient share~50% ~50% Approaching 50%
EMPAVELI compliance97% 97% 97%
Cash & equivalents ($M)$360.1 (6/30/24) $396.9 (9/30/24) $411.3 (12/31/24)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
SYFOVRE net revenue cadenceQ1 2025 vs Q4 2024Not providedQ1 below Q4 due to seasonality and elevated samples; injections up QoQ New near‑term caution
SYFOVRE gross-to-netFY 2025Low–mid 20% (Q3 guide) Low–mid 20% reiterated Maintained
PriceEffective 1/1/2025—+1% price increase to offset ASP erosion New
Operating expensesFY 2025—Relatively stable vs 2024 New
Liquidity/runwayThrough profitabilitySufficient to positive cash flow (Q3) Cash + sales sufficient to fund core business to profitability Maintained
EMPAVELI (C3G/IC‑MPGN) launch timingU.S.—Target 2H 2025, if approved New timing
PipelineFSGS, DGF—Phase 3 starts planned 2H 2025 New timing

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q4 2024)Trend
Competitive GA dynamicsQ2: Emphasis on efficacy, every‑other‑month dosing; payer wins (two PBMs) . Q3: 65% share; gross‑to‑net step-up discussed; efficacy messaging simplified; DTC Phase 2 planned .Maintained leadership (>60% share), ~94k Q4 doses; payer preferred positions; competitor label update seen as reinforcing SYFOVRE’s strengths .Stable leadership; narrative shifting to efficacy and dosing flexibility.
Gross‑to‑net/ASPQ2: modest increases typical; ASP pressure manageable . Q3: GN jumped; guided low–mid 20% through 2025 .Reiterated low–mid 20% for 2025; 1% price increase .Stabilizing after Q3 “perfect storm”.
Demand cadenceQ2: Double‑digit growth; June best month . Q3: Vial growth low‑mid single digits; market growth slowed .Q1 2025 net revenue to dip QoQ due to samples/seasonality, but injections rising .Near‑term revenue headwinds; underlying injections healthy.
Payer accessQ2: Two national PBMs preferred SYFOVRE . Q3: Large MA plan pref. from Jan 1 .Aetna example; multiple sizable plans/PBMs with preferred status .Expanding preferred access.
SafetyQ2: Risk committee alignment; first‑injection phenomenon . Q3: Safety transparency; adherence similar to anti‑VEGF .Safety profile stable; adherence remains strong .Stable.
Rare nephrologyQ2: Await VALIANT; broad inclusion . Q3: VALIANT positive across endpoints .sNDA filed; 2H 2025 U.S. launch goal; Phase 3s in FSGS/DGF planned .Accelerating.
InternationalQ2/Q3: EU setbacks; ex‑U.S. selective focus .Australia approval; Switzerland review ongoing .Selective ex‑U.S. progress.

Management Commentary

  • “SYFOVRE maintained its market leadership with approximately 94,000 doses delivered... Total market share remained stable at over 60% and new patient share trended positively, ending the year approaching 50%.” — EVP Commercial David Acheson .
  • “We anticipate gross to net to be in the low to mid‑20% range through 2025... We took a 1% price increase on January 1.” — CFO Tim Sullivan .
  • “We do think that Q1 will be lower than Q4... [but] we’re seeing injections... grow in Q1 versus Q4.” — EVP Commercial David Acheson .
  • “Pegcetacoplan rapidly, significantly, and consistently improved key outcomes... 68% proteinuria reduction... stabilization of eGFR... 71% zero C3c staining.” — VALIANT highlights .

Q&A Highlights

  • Q1 outlook: Net revenue to be lower than Q4 due to seasonal factors and ~5,000 incremental samples tied to co‑pay assistance funding gaps; injections are up QoQ, supporting 2025 growth resumption .
  • Competitive label dynamics: Management emphasized SYFOVRE’s every‑other‑month dosing and increasing effects over time vs competitor’s lack of q8w approval; payer preference and efficacy narrative cited as differentiators .
  • Payer access: Examples include Aetna and two major PBMs with preferred policies; downstream PBM decisions vary, but preferred positioning expanding .
  • Medicare redesign impact: Too early to quantify; monitoring closely .
  • Inventory/sampling: Modest Q4 inventory movement with typical EoQ dynamics; expected early Q1 drawdown, unrelated to core demand .
  • Patent/exclusivity: Composition of matter runs to ~2035 with customary extensions; lifecycle initiatives ongoing .

Estimates Context

  • We attempted to pull S&P Global consensus (revenue, Primary EPS, and # of estimates) for Q4 2024 and the two prior quarters; the request failed due to a daily request limit at the time of retrieval. As a result, we cannot quantify beat/miss versus consensus in this report. We will update the estimates comparison as soon as S&P Global data is accessible.*

Key Takeaways for Investors

  • Near‑term setup: Expect softer Q1 net revenue despite rising injections, driven by seasonal reverifications, weather disruptions, and a temporary sample mix spike; watch for revenue normalization as samples abate and GN stabilizes in low‑mid 20% .
  • Medium‑term thesis: SYFOVRE’s efficacy narrative, every‑other‑month dosing, and expanding payer preference underpin category leadership and durable adoption; preferred status is a tangible moat vs q4w-only competition .
  • Profitability path: 2024 revenue ($781.4M) nearly matched non‑GAAP spending; OpEx flat YoY in 2025 and GN stabilization support the path to profitability without external capital .
  • Rare nephrology optionality: VALIANT’s broad and robust dataset plus sNDA set up a potentially meaningful 2H 2025 U.S. launch for EMPAVELI in C3G/IC‑MPGN; Phase 3 starts in FSGS/DGF expand TAM and duration .
  • Watchlist catalysts: FDA review progress and label/launch timing for EMPAVELI (C3G/IC‑MPGN), payer wins and DTC impact on GA referrals, and updates on APL‑3007 + SYFOVRE Phase 2 design and initiation in 2Q 2025 .
  • Risk checks: GN/ASP pressure, sampling dynamics, competitive messaging, and any policy impacts (Medicare redesign) warrant monitoring for quarterly cadence variability .

Footnotes:

  • S&P Global consensus values were unavailable at request time due to a daily limit error; we will refresh and provide beat/miss analysis once accessible.

Sources: Q4’24 earnings call transcript ; Q4’24 earnings press release (financials) ; Q3’24 press release and transcript ; Q2’24 press release and transcript ; VALIANT results press release .