Regeneron — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenues increased 36% year-over-year to $5.116 billion in Q3 2026, compared to $3.754 billion in Q3 2025.
• GAAP net income rose 33% to $1.949 billion, while GAAP net income per share (diluted) increased 35% to $18.45.
• Non-GAAP net income increased 67% to $2.150 billion, and non-GAAP net income per share (diluted) surged 70% to $20.07.
• Net product sales totaled $1.805 billion, up 14% from $1.588 billion in the prior year period.
• Collaboration revenue grew 68% to $3.001 billion, driven by a 68% increase in Sanofi collaboration revenue to $2.724 billion.
• Research and development (R&D) expenses increased 22% to $1.795 billion (GAAP) and 23% to $1.654 billion (non-GAAP).
• Selling, general, and administrative (SG&A) expenses rose 3% to $678 million (GAAP) and 9% to $588 million (non-GAAP).
• Gross margin on net product sales remained stable at 82% (GAAP) and 86% (non-GAAP).
• Free cash flow for the nine months ended September 30, 2026, was $2.904 billion, down from $3.159 billion in the same period of 2025.
• Cash and marketable securities stood at $18.859 billion as of September 30, 2026.
• Deferred revenue increased to $970.0 million from $761.7 million at the end of 2025.
• Long-term debt remained relatively flat at $1.987 billion.

Guidance and Future Outlook:

• Updated full-year 2026 GAAP R&D guidance raised to $6.600–$6.735 billion (from $6.500–$6.635 billion).
• Updated full-year 2026 non-GAAP R&D guidance raised to $6.050–$6.150 billion (from $5.950–$6.050 billion).
• Updated full-year 2026 GAAP SG&A guidance lowered to $2.730–$2.860 billion (from $2.830–$2.960 billion).
• Updated full-year 2026 non-GAAP SG&A guidance lowered to $2.400–$2.500 billion (from $2.500–$2.600 billion).
• Updated full-year 2026 GAAP gross margin on net product sales raised to approximately 80% (from 78%–79%).
• Updated full-year 2026 non-GAAP gross margin on net product sales raised to approximately 86% (from 84%–85%).
• Updated full-year 2026 capital expenditures guidance raised to $1.050–$1.100 billion (from $1.030–$1.100 billion).
• Updated full-year 2026 GAAP effective tax rate guidance raised to approximately 14% (from 13%–14%).
• Updated full-year 2026 non-GAAP effective tax rate guidance raised to approximately 15% (from 14%–15%).
• Management expects an FDA decision for cemdisiran in generalized myasthenia gravis in the following month (November 2026).
• Phase 3 programs in multiple myeloma, lymphoma, anticoagulation, and obesity are advancing.
• Encouraging early data has been generated in MASH, POTS, and ovarian cancer.
• A Phase 3 study in metabolic dysfunction-associated steatohepatitis (MASH)/MASLD is planned for initiation in Q4 2026.
• A Phase 3 study in postural orthostatic tachycardia syndrome (POTS) is planned for initiation in the first half of 2027.

Business Segments and Product Lines:

• Dupixent® global net sales (recorded by Sanofi) increased 35% to $6.541 billion.
• EYLEA HD® U.S. net sales increased 62% to $699 million, driven by higher sales volumes.
• EYLEA® U.S. net sales decreased 41% to $400 million due to competitive pressures and patient transition to EYLEA HD.
• Total EYLEA HD and EYLEA U.S. net sales decreased 1% to $1.099 billion.
• Libtayo® global net sales increased 51% to $550 million, with U.S. sales up 81% to $396 million.
• Praluent® U.S. net sales increased 21% to $81 million.
• Evkeeza® U.S. net sales increased 28% to $55 million.
• Lynozyfic® global net sales were $19 million.
• Pasatru™ (garetosmab) received FDA approval for the treatment of fibrodysplasia ossificans progressiva (FOP).
• The FDA accepted for review the resubmission of the BLA for Ordspono™ (odronextamab) in relapsed or refractory diffuse large B-cell lymphoma (DLBCL), with a target action date in February 2027.
• The European Medicines Agency's CHMP adopted a positive opinion recommending approval of an alternative dosing schedule for Libtayo (every six weeks after initial 12 weeks).
• A three-arm Phase 3 study was initiated for cenvacibart and amrecibart for the prevention of venous thromboembolism in patients with PICCs.
• Interim results from an RNAi therapy targeting CIDEB showed a 70% average reduction in liver fat at 12 weeks in adults with MASLD.

Market and Competitive Landscape:

• EYLEA U.S. sales faced continued competitive pressures.
• The Company is advancing a pipeline of approximately 50 product candidates.
• Sanofi collaboration revenue growth was driven by higher profits associated with increased Dupixent sales.
• Bayer collaboration revenue decreased 23% to $267 million.

Risks and Challenges:

• Forward-looking statements involve risks including competing products, market acceptance uncertainty, and regulatory approval timing.
• Risks include safety issues, manufacturing supply chain management, and trade restrictions/tariffs.
• Reimbursement and pricing regulations, including changes to drug pricing strategies and government agreements, pose potential challenges.
• Litigation and intellectual property proceedings, including pending civil proceedings by the U.S. Department of Justice, present risks.
• The potential for collaboration agreements to be cancelled or terminated is a stated risk.
• The 2026 financial guidance does not assume the completion of any business development transactions not completed as of the release date.

Management Commentary and Tone:

• Leonard S. Schleifer, M.D., Ph.D., described the quarter as "outstanding," noting record net sales for Dupixent, EYLEA HD, and Libtayo.
• Christopher Fenimore, Executive Vice President and CFO, expressed pleasure with results, citing the third consecutive quarter of double-digit growth in revenue and non-GAAP EPS.
• Management attributed the 36% revenue increase to strong commercial execution and the anticipated step-up in Sanofi collaboration revenue following the repayment of the Development Balance.
• The Company expects to deliver "one of our strongest years ever."

Other Key Points:

• Regeneron expanded its collaboration with Sanofi, adding four next-generation, long-acting antibodies; the Company received a $1.0 billion up-front payment to be recognized as collaboration revenue in Q4 2026, with potential for up to $7.0 billion in future milestones.
• During the nine months ended September 30, 2026, the Company repurchased $2.3 billion of common stock, with $2.2 billion remaining available.
• In October 2026, the Company declared a cash dividend of $0.94 per share, payable on December 3, 2026.
• The Company announced an agreement with BARDA to provide additional supply of Inmazeb® for U.S. preparedness against Ebola disease, with deliveries scheduled from 2027 through 2031.
• The Sanofi Development Balance was fully repaid as of the end of Q2 2026, meaning no further reduction to Sanofi collaboration revenue.
• GAAP effective tax rate for Q3 2026 was 14.7%, compared to 17.2% in Q3 2025, which was negatively impacted by the "One Big Beautiful Bill Act."