ARROWHEAD PHARMACEUTICALS, INC. (ARWR) Q4 2024 Earnings Summary

Executive Summary

• Fiscal Q4 2024 reporting was bundled in Arrowhead’s FY2024 year-end release; the period showed minimal revenue and significantly higher R&D-led operating spend, driving a FY2024 net loss of $599.5M ($5.00 diluted EPS), versus a FY2023 net loss of $205.3M ($1.92) .
• Strategic financing and a broad collaboration with Sarepta added immediate and near-term capital ($500M upfront cash; $325M equity at $27.25; $250M paid over five years; up to $300M near-term payments), extending cash runway into 2028 and supporting multiple launches .
• Plozasiran NDA for FCS was submitted; Phase 3 PALISADE hit primary and key secondary endpoints, including an 83% reduction in acute pancreatitis incidence versus placebo, setting a potential 2025 launch subject to FDA review .
• Management guided 2025 cash burn to $500–$550M and expects ~$$1.0B year-end cash; similar burn in 2026 with year-end cash $600–$650M, reinforcing liquidity ahead of pivotal readouts and commercial preparation .
• Street EPS/revenue consensus was not retrievable at time of analysis due to S&P Global access limits; beat/miss cannot be determined and will be updated when available (S&P Global consensus unavailable).

What Went Well and What Went Wrong

What Went Well

• Strategic capital and partner validation: “The partnership we announced today with Sarepta is transformational… puts us on a fairly straight path to profitability” with potential deal value >$11B plus royalties .
• Clinical execution and regulatory momentum: Plozasiran NDA filed for FCS; PALISADE achieved ~80% TG reduction and an 83% reduction in acute pancreatitis risk; consistent efficacy regardless of genotype .
• Commercial readiness: Medical affairs and commercial infrastructure being built, targeting mid-2025 launch contingent on approval; ex‑US partnership options under consideration .

What Went Wrong

• Revenue dried up versus the prior year as no new collaboration milestones hit in FY2024: FY revenue fell to $3.6M from $240.7M YoY .
• Operating spend increased materially with Phase 3 ramp: Total operating expenses rose to $604.6M (vs. $445.7M), and net cash used in operating activities rose to $462.9M (vs. $153.9M) .
• Quarterly granularity lacking in year-end materials: Q4 discrete revenue/EPS/margins were not disclosed in the press release, complicating near-term trend tracking; S&P Global estimates were unavailable in this session (S&P Global consensus unavailable) .

Financial Results

Annual Comparison

Quarterly Trend (Q2 and Q3 FY2024; Q4 not separately disclosed)

Notes: Q4 FY2024 quarterly figures were not provided in the year-end press release; FY totals shown above reflect full-year outcomes .

KPIs (Liquidity and Runway; Management Guidance)

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• CEO: “The partnership we announced today with Sarepta is transformational… returns balance to our business model… and puts us on a fairly straight path to profitability” .
• CEO on capital: “We are now funded toward the end of 2028 and potentially through multiple commercial launches by Arrowhead and our partners” .
• Chief Medical Scientist on PALISADE: “We observed an 80% reduction from baseline in median triglycerides… and a statistically significant 83% reduction in incidence of acute pancreatitis” .
• Commercial lead: “Plozasiran is the first and only investigational medicine to report a statistically significant reduction in the risk of developing acute pancreatitis in patients with… FCS… conveniently dosed every 3 months” .
• CFO on liquidity: “Pro forma cash resources… would be $1.5 billion… we estimate that this partnership agreement extends our cash runway into 2028” .

Q&A Highlights

• Deal competitiveness and HSR process: Management engaged multiple potential partners; chose Sarepta; expects HSR clearance timeline around early January; sees no overlap concerns from Arrowhead’s perspective .
• Debt strategy: Will pay down interest and principal over time using Sarepta and other BD cash inflows; milestones tied to DM1 cohort dosing expected across first three quarters of 2025 .
• Obesity programs: Strategically important; first-in-human plans with placebo control; combination potential with GLP‑1 for improved quality of weight loss and maintenance .
• Commercial approach: Ex‑US partnerships remain possible; US commercialization to be built around plozasiran with scaling for cardiometabolic assets .
• NDA specifics: Filing focused on 25 mg dose; agency guided inclusion of clinically diagnosed FCS alongside genetically confirmed; label scope to be determined by FDA .

Estimates Context

• Wall Street consensus EPS and revenue for Q4 FY2024 and FY2024 could not be retrieved due to S&P Global access limits during this session; beat/miss versus consensus cannot be assessed at this time (S&P Global consensus unavailable).
• Observed fundamentals indicate FY revenue fell sharply YoY with operating expense escalation tied to Phase 3 activity, suggesting near-term estimate revisions may focus on opex trajectory and timing of potential FCS revenue post‑approval .

Key Takeaways for Investors

• Liquidity and runway materially de-risked: Immediate and staged cash from Sarepta and prior financing underpin opex plans through 2028, reducing capital risk and enabling commercial build-out for plozasiran .
• Near-term regulatory catalyst: FDA acceptance/PDUFA for plozasiran (FCS) is pivotal; mid‑2025 launch window contingent on approval could initiate a rare-disease revenue base .
• Clinical differentiation: PALISADE’s pancreatitis-risk reduction is a meaningful payer/physician outcome; quarterly dosing and favorable tolerability are commercially attractive .
• Expansion optionality: SHTG Phase 3 program and potential mixed hyperlipidemia outcomes study (CAPITAN) could broaden plozasiran market and double revenue potential longer term (subject to CVOT funding) .
• Focused portfolio execution: Concentration on cardiometabolic assets while monetizing non-core programs via Sarepta and potential further BD may improve capital efficiency and valuation clarity .
• Watch operating spend trajectory: 2025–2026 cash burn guided at $500–$550M annually; investors should track Phase 3 enrollment pace and opex moderation into 2026–2027 .
• Near-term stock catalysts: FDA acceptance/PDUFA date, additional SHASTA/MIRR enrollment updates, obesity program first-in-human starts, and any ex‑US commercial partnering for plozasiran .