ARROWHEAD PHARMACEUTICALS, INC. (ARWR) Q3 2025 Earnings Summary

Executive Summary

Fiscal Q3 2025 was operationally strong but financially modest: revenue was $27.8M, net loss was $(175.2)M, and diluted EPS was $(1.26), reflecting the absence of large licensing revenue recognized in Q2 .
Commercial build for plozasiran is on track ahead of the November 18, 2025 PDUFA date; payer engagement now covers >85% of U.S. covered lives, and the sales field force is hired and training, positioning Arrowhead for launch readiness .
Post-quarter catalysts: Arrowhead earned a $100M DM1 milestone (Q4 recognition) and expects $130M upfront revenue from Sanofi’s Greater China deal in Q4; a second DM1 enrollment milestone ($200M) is targeted by year-end .
Strategic momentum continues across late-stage programs (plozasiran SHTG Phase 3 enrollment completed; zodasiran HoFH Phase 3 started) and emerging platforms (obesity ALK7/INHBE, CNS delivery) supporting multi-year launch potential .

What Went Well and What Went Wrong

What Went Well

Completed enrollment in SHASTA‑3/‑4 (SHTG) and MUIR‑3, meeting regulatory design requirements and setting up mid-2026 primary completion and subsequent sNDA submission for SHTG .
Commercial readiness for FCS: payer outreach (>85% covered lives) and full rare disease sales force established; narrative centered on deep TG reduction and pancreatitis risk reduction supports access and HCP adoption .
Business development inflows: $100M DM1 milestone achieved and expected $130M upfront from Sanofi for Greater China rights to plozasiran; management expects a second $200M DM1 milestone by year-end .
Management tone on pipeline maturity and financing: “launch ready on day one” for plozasiran and a “strong balance sheet” enabling multiple innovations through clinical/regulatory pathways .

What Went Wrong

Financials normalized after the outsized Q2 licensing recognition; Q3 revenue dropped to $27.8M and GAAP net loss increased to $(175.2)M, as R&D and SG&A rose with Phase 3 and commercialization activities .
Continued operating losses reflect heavy investment: total operating expenses rose to $193.3M (vs. $176.1M prior-year), driven by Phase 3 SHTG trials and go-to-market spend; net cash used in operations was $154.7M in the quarter .
External overhang from Sarepta’s restructuring affected sentiment; management addressed obligations under the agreement and contingency (asset return) provisions but acknowledged uncertainty on Sarepta’s shareholding actions .

Financial Results

Metric	Q3 2024	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD Millions)	$0.0	$2.5	$542.7	$27.8
Net Income (Loss) ($USD Millions)	$(170.8)	$(173.1)	$370.4	$(175.2)
Diluted EPS ($USD)	$(1.38)	$(1.39)	$2.75	$(1.26)
Total Operating Expenses ($USD Millions)	$176.1	$163.9	$161.5	$193.3

Notes:

Q2 revenue and net income were driven by recognition of initial consideration from the Sarepta deal (upfront, equity premium, and multi-year installments), with CFO detailing revenue allocation and forward recognition cadence .
Q3 revenue primarily reflects ongoing Sarepta recognition and cost reimbursements; post-quarter, Arrowhead expects to recognize $100M (DM1 milestone) and $130M (Sanofi upfront) in Q4 .

Balance Sheet and Cash KPIs

KPI ($USD Millions unless noted)	Sep 30, 2024	Q1 2025 (Dec 31, 2024)	Q2 2025 (Mar 31, 2025)	Q3 2025 (Jun 30, 2025)
Cash, Cash Equivalents & Restricted Cash	$102.7	$53.9	$185.7	$129.8
Investments / AFS Securities	$578.3	$499.0	$911.7	$770.6
Total Cash Resources	$681.0	$552.9	$1,097.4	$900.4
Credit Facility	$393.2	$409.4	$273.9	$240.3
Deferred Revenue	—	—	$43.3	$23.0
Total Liabilities	$948.7	$957.6	$889.3	$860.8
Total Stockholders’ Equity	$185.4	$52.6	$683.3	$522.3
Shares Outstanding (Millions)	124.4	125.6	138.1	138.1

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue Recognition (Sanofi upfront for Greater China plozasiran)	Q4 2025	N/A	Expect to record $130M in Q4 from upfront upon closing	New commentary
Milestone Revenue (Sarepta DM1)	Q4 2025	N/A	$100M milestone recognized in Q4; targeting additional $200M milestone by YE 2025	New commentary
AdCom expectation (FCS PDUFA)	2025	Not planning to hold AdCom per earlier communication	No change: management still not anticipating an AdCom for the FCS review	Maintained
EU filings/launch readiness	2025	EMA MAA valid; EU launch preparations ongoing	Continued progress; EU/U.K./Canada prioritized in commercialization plans	Maintained

Arrowhead did not provide formal quantitative guidance for revenue, margins, or EPS; disclosures above are outlook comments tied to specific transactions and regulatory timelines .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 FY25)	Previous Mentions (Q2 FY25)	Current Period (Q3 FY25)	Trend
FCS PDUFA and launch readiness	FDA accepted NDA; PDUFA 11/18/2025; independent launch plans	No AdCom anticipated; EU MAA valid; U.S./EU commercialization plans	Field force hired; payer outreach >85%; launch-ready by PDUFA	Strengthening execution
SHTG Phase 3 program	On track to fully enroll in 2025	Enrollment expected by summer; SHASTA‑5 outcome study planned	SHASTA‑3/‑4/MUIR‑3 enrollment completed; mid‑2026 primary completion	Milestone achieved
Pancreatitis outcomes	PALISADE showed reduced pancreatitis; TG goals emphasized	SHASTA‑5 outcome study for AP reduction; focus on definite AP	Continued emphasis on TG deep reduction and AP risk reduction	Consistent focus
Obesity (ALK7/INHBE)	Initiated Phase 1/2a; adipose targeting mechanism	SAD completed for INHBE; combo cohorts enrolling; ALK7 start imminent	ALK7 Phase 1/2a first subjects dosed; initial data expected year-end	Advancing
CNS platform	Preclinical progress; CTA planning for MAPT	Expect clinic entry (MAPT, HTT, SNCA) late 2025/early 2026	Strategic BD momentum; Novartis ARO‑SNCA license post-quarter	De-risking via BD
Business development & financing	Sarepta deal closed; funded into 2028	Detailed revenue recognition & cash runway	$100M DM1 milestone; Sanofi Greater China deal; strong balance sheet	Enhanced runway

Management Commentary

“Our pipeline has become quite mature, with four Arrowhead discovered candidates currently in pivotal Phase 3 studies… our commercial buildout is designed to make us launch ready on day one, should plozasiran receive regulatory approval on the November 18, 2025, PDUFA date.” — Christopher Anzalone, CEO .
“Our market access team… connected with payers representing over 85% of US covered lives… particularly in plozasiran’s potential to deeply lower triglycerides… and significantly reduce the risk of acute pancreatitis.” — Andy Davis, SVP .
“We continue to maintain a strong balance sheet… giving us the financial resources to move multiple innovative new medicines through the clinical and regulatory process.” — Christopher Anzalone, CEO .
“Revenue for the quarter… was $27.8M driven almost entirely by recognition related to Sarepta… after the end of the quarter… $100M DM1 milestone and $130M Visirna/Sanofi upfront to be recognized in Q4.” — Daniel Apel, CFO .
“Clozasiran is not an ASCVD drug. Clozasiran is a pancreatitis drug… and should be thought of and priced as such.” — Christopher Anzalone, CEO .

Q&A Highlights

SHTG competitor comparisons and AP endpoints: Management emphasized difficulty of cross-trial comparisons and focus on adjudicated acute pancreatitis over broader abdominal pain measures; deep TG reduction and goal attainment (<500 mg/dL) are key physician metrics .
Payer access and pricing: Early payer feedback supportive for genetically confirmed and clinically defined FCS; pricing likely lower for broader SHTG versus FCS, with positioning around pancreatitis risk reduction .
Auto injector timeline: Initial FCS presentation via prefilled syringe; auto injector targeted for SHTG at launch or soon after .
Obesity programs: Expect initial ALK7/INHBE data end-2025; focus on visceral fat reduction with lean-mass preservation and quarterly dosing potential; platform novelty implies hypothesis-generating early studies .
Sarepta exposure: CEO addressed restructuring impacts, obligations under the agreement, and potential asset return provisions; acknowledged lockup and possible share sale dynamics .

Estimates Context

Consensus EPS and revenue estimates from S&P Global for ARWR were unavailable for Q3 2025, Q2 2025, Q1 2025, and Q3 2024 at the time of this analysis. As a result, estimate comparisons and beat/miss assessments cannot be provided. Values retrieved from S&P Global.*

Key Takeaways for Investors

Near-term catalyst path is robust: FCS PDUFA on November 18, 2025; mid‑2026 SHTG Phase 3 primary completion; zodasiran HoFH Phase 3 underway, enabling multi‑year launch optionality .
Commercial readiness lowers execution risk: payer engagement breadth (>85% covered lives), trained rare disease field force, and clear disease-state education focus (TG goals and pancreatitis outcomes) .
Revenue cadence to inflect in Q4: $100M DM1 milestone and $130M Sanofi upfront expected; potential $200M additional DM1 milestone by YE 2025 provides further non‑dilutive capital .
Strategic positioning: Plazasiran framed as a pancreatitis drug (not ASCVD), supporting pricing and access narratives for FCS and later SHTG; outcome study SHASTA‑5 tailored to European HTA needs .
Pipeline breadth with late‑stage leverage and platform expansion (obesity and CNS) underpins medium‑term thesis; BD (e.g., Novartis ARO‑SNCA) helps de‑risk CNS translation and fund development .
Watch external variables: competitor readouts in SHTG, payer dynamics for clinically defined FCS, and Sarepta-related headlines; Arrowhead’s adjudicated AP focus and deep TG reductions should remain central to differentiation .

Sources: Q3 FY25 press release and 8‑K ; Q3 FY25 earnings call transcript ; Q2 FY25 press release and call ; Q1 FY25 press release ; Sarepta $100M milestone PR ; Sanofi/Visirna Greater China agreement (embedded in Q3 PR/8-K) ; Novartis collaboration PR (post-quarter) .