Earnings call transcript: United Therapeutics Q2 2025 misses EPS, stock drops

United Therapeutics Corporation reported its second-quarter earnings for 2025, revealing a slight miss in both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $6.41, falling short of the anticipated $7.35. Revenue reached $799 million, just below the forecasted $804.98 million. Following the announcement, United Therapeutics’ stock fell by 2.63% to $285.49 during pre-market trading, reflecting investor disappointment. According to InvestingPro analysis, the company maintains an EXCELLENT financial health score of 3.77, and current valuations suggest the stock may be undervalued. For detailed insights into UTHR’s valuation metrics and 12 additional ProTips, consider exploring the comprehensive Pro Research Report.

Key Takeaways

• United Therapeutics reported 12% year-over-year revenue growth, marking its 12th consecutive quarter of double-digit growth.
• The company launched a $1 billion share repurchase program, signaling confidence in its future prospects.
• Tyvaso DPI achieved record revenue of $315 million, with a 22% increase year-over-year.
• The stock price dropped by 4.06% in pre-market trading following the earnings release.

Company Performance

United Therapeutics continues to demonstrate robust growth, with a 12% increase in total revenue compared to the same quarter last year. This marks the 12th consecutive quarter of double-digit revenue growth, driven by strong performance across its commercial portfolio, including Tyvaso DPI, Orenitram, Remodulin, and Humatuxin.

Financial Highlights

• Revenue: $799 million, up 12% year-over-year
• Earnings per share: $6.41, below the forecasted $7.35
• Tyvaso DPI revenue: $315 million, a 22% increase from the previous year

Earnings vs. Forecast

United Therapeutics reported an EPS of $6.41, missing the forecast of $7.35 by 12.79%. Revenue also fell short of expectations at $799 million compared to the anticipated $804.98 million. This represents a minor revenue surprise of -0.79%, indicating a slight miss in financial performance.

Market Reaction

Following the earnings announcement, United Therapeutics’ stock experienced a decline, dropping 2.63% to $285.49 in pre-market trading. The stock’s movement reflects investor reaction to the earnings miss, despite the company’s consistent revenue growth. Trading near its 52-week low, the stock currently maintains an attractive P/E ratio of 10.69, suggesting potential value opportunity. InvestingPro analysis indicates the stock is currently undervalued, with analysts setting price targets ranging from $314 to $510. Over the past 52 weeks, the stock has seen a high of $417.82 and a low of $266.98, with the current price nearing its lower range.

Outlook & Guidance

Looking ahead, United Therapeutics remains optimistic about its pipeline and market position. The company expects data readout for the TETON-two study in September and potential expansion of Tyvaso for idiopathic pulmonary fibrosis (IPF). Future EPS forecasts for the coming quarters range from $7.32 to $9.58, with revenue projections between $800 million and $844.82 million. With a market capitalization of $13.42 billion and analyst consensus leaning strongly toward "Buy," the company appears well-positioned for future growth. Discover more detailed analysis and growth projections in the comprehensive Pro Research Report available on InvestingPro.

Executive Commentary

CEO Martine Rothblatt highlighted the company’s performance, stating, "We have achieved another record quarter of earnings, marking 12 consecutive quarters of double-digit year-over-year revenue growth." President and COO Michael Benkowitz added, "We believe that over the long term, with Tyvaso’s product profile, along with the deep experience we’ve built in the pulmonary hypertension marketplace, we are positioned for continued growth."

Risks and Challenges

• Potential competition in the IPF market could impact future revenue growth.
• Regulatory challenges in drug approvals might delay new product launches.
• Market volatility and economic pressures could affect investor sentiment and stock performance.

Q&A

During the earnings call, analysts inquired about the competitive dynamics of Tyvaso DPI and the design of the TETON study. Executives addressed potential market impacts of competing therapies and provided insights into the mechanisms of IPF treatment, reinforcing confidence in the company’s strategic direction.

Full transcript - United Therapeutics Corporation (UTHR) Q2 2025:

Steve, Conference Operator: Good morning, and welcome to the United Therapeutics Corporation Second Quarter twenty twenty five Corporate Update. My name is Steve, and I’ll be your conference operator today. All participants on the call portion of the webcast will be in a listen only mode until the question and answer portion of this earnings call. Please note this call is being recorded. I would now like to turn the webcast over to Dhiv Steedman, Head of Investor Relations at United Therapeutics.

Please go ahead.

Dhiv Steedman, Head of Investor Relations, United Therapeutics: Thank you, Steve, and good morning. It’s my pleasure to welcome you to the United Therapeutics Corporation’s second quarter twenty twenty five corporate update webcast. Remarks today will include forward looking statements representing our expectations or beliefs regarding future events. These statements will involve risks and uncertainties that may cause actual results to differ materially. Our latest SEC filings, including Forms 10 ks and 10 Q, contain additional information on these risks and uncertainties.

We assume no obligation to update these forward looking statements. Today’s remarks may discuss the progress and results of clinical trials or other developments with respect to our products. These remarks are intended solely to educate investors and are not intended to serve as the basis for medical decision making or to suggest that any products are safe and effective for any unapproved or investigational uses. Full prescribing information for our products are available on our website. Accompanying me on today’s call are Doctor.

Martine Rothblatt, our Chairperson Chief Executive Officer Michael Benkowitz, our President and Chief Operating Officer Jane Sechmond, our Chief Financial Officer and Treasurer Doctor. Lee Peterson, our Executive Vice President of Product Development and Xenotransplantation Pat Poisson, our Executive Vice President of Technical Operations Gil Golden Doctor. Gil Golden, our Executive Vice President and Chief Medical Officer and C. Q. Ding, our Senior Vice President of Biostatistics, Statistical Programming and Data Management.

Note that James Edgemond, my colleague, Carrie Silvers and I will participate in a fireside chat and one on one meetings at the Morgan Stanley Global Healthcare Conference in New York on September 8. Along with Martine Rothblatt, Harry and I will be at the Bernstein’s Second Annual Healthcare Forum in New York on September 23 for fireside chat and one on one meetings. Additionally, our Scientific Commercial and Medical Affairs team will present at the World Transplant Congress in San Francisco, August ’6 the European Respiratory Society Congress in Amsterdam on September 27 through October 1 the eighteenth Congress of the International Xenotransplantation Association in Geneva, September 30 to October 3 and the American College of Chest Physicians meeting at CHEST twenty twenty five in Chicago, October ’22. Now I’ll turn the webcast over to Martine for an overview of our development pipeline and business activities. Martine?

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Dewey, and good morning, everyone. We have slides available for reference and I encourage you to review those at your leisure. Today, we’re proud to report that United Therapeutics has achieved another record quarter of earnings, marking 12 consecutive quarters of double digit year over year revenue growth. Our performance is a testament to our unwavering strategic approach, which has allowed us to consistently drive sustainable growth while improving the lives of the patients we serve. Our strong foundational business is supported by our robust Tyvaso franchise, which continues to achieve record results underpinned by our first in class Tyvaso DPI device and enduring market fundamentals expect will propel future growth.

Additionally, Orenitram, Remodulin and Unituxin remain integral components of our commercial portfolio and continue to deliver strong performance. Our next wave of growth, which we call our innovation wave consists of our TETON studies in idiopathic pulmonary fibrosis and our advanced outcome study in pulmonary arterial hypertension, which were on the cusp of reporting results starting with TETON-two in September. Each of these catalysts has the potential to fundamentally change our revenue profile and deliver growth well into the next decade. Our largest potential wave of growth, a revolution wave continues to make progress and we are on track to conduct the first transplant in our EXPAND U kidney clinical study shortly. Concurrently with this first ever phase of study and as part of our multiple shots on goal approach, we’re also proud to announce that we have filed an investigational new drug application for our EXTEND study evaluating our U thymo kidney and we expect to file for our EXPRESS study evaluating our U Heart.

Additionally, last month we announced that we enrolled and treated the first patient in our MIRA liver ELAB study. Recently, our Investor Relations team launched a new pipeline website at pipeline.unither.com that contains detailed information and links to publications about our pipeline candidates. I encourage you to take a look. Our ability to deliver such remarkable growth and pipeline innovation is matched only by our commitment to financial prudence. The exceptional operating efficiency that we have cultivated has allowed us to generate nearly $1,500,000,000 in annual operating cash flow.

Our disciplined approach allows us to strategically allocate capital ensuring that United Therapeutics remains flexible, resilient and well positioned for sustained success in the years ahead. Given the strength of our commercial business, our robust balance sheet and confidence in our upcoming catalysts, we believe that the recent dislocation in our share price presents a particularly compelling investment opportunity. And as such, our Board of Directors has authorized the repurchase of up to $1,000,000,000 in our shares through March. We will continue to regularly evaluate our capital needs and deploy cash toward the highest and best uses. Even after the potential repurchase of shares as authorized by our Board, we remain well capitalized to continue advancing our commercial and development programs.

As we approach these meaningful and potentially value creating catalysts across pulmonary fibrosis and pulmonary arterial hypertension, we could not be more confident in the future of our business. To conclude, we expect to sustain growth in our foundational business, which continues to drive significant cash flow and opportunity while also progressing our innovative small molecule pipeline and our platform of organ alternative technologies. We’re excited about our current business and our growth potential and we appreciate the feedback and support from our shareholders. We have a number of different presentations this morning with Michael Benkowitz addressing our commercial performance, Lee Peterson outlining our TETON-two study for which we expect to report data in September, C. Q.

Deng, our Chief Biostatistician to talk about the recent Insmed Phase two data and then Doctor. Gil Golden, our Chief Medical Officer, who will outline the expected limited impact we believe TPIP will have on the market if it is approved. Mike?

Michael Benkowitz, President and Chief Operating Officer, United Therapeutics: Thank you, Martine, and good morning, everyone. Today, we are pleased to report record total revenue of $799,000,000 reflecting 12% growth over the 2024. This is our twelfth consecutive quarter of double digit year over year total revenue growth, driven by robust results across our commercial portfolio. Underpinning this performance, Tyvaso DPI achieved a record total revenue of $315,000,000 representing 22% growth over the 2024. This quarter also marked a record for patient shipments for Tyvaso DPI as well as the total Tyvaso franchise.

The underlying dynamics remain strong with referrals and starts each reaching record levels for Tyvaso DPI during the quarter. We also saw year over year double digit revenue growth for nebulized Tyvaso, Orenitram and Humatuxin. For Orenitram, this quarter represented a record in both total revenue and patient shipments. Touching briefly on Remodulin performance, we are still seeing strong demand for Remodulin, which now is a top five quarter in total patient shipments and we are confident that parental prostacyclines will continue to play a meaningful role in the marketplace. We look forward to the launch of our next generation pump for Immunity Pro later this year.

With the recent launch of a competing treprostinil dry powder inhaler, I’d like to address several areas of misinformation in the marketplace about Tyvaso DPI. Liquidia is attempting to differentiate their product in the areas of dosing, tolerability, particle deposition and ease of use. First, there is no maximum dose for Tyvaso DPI and there’s no commercial available treprostinil DPI that has published higher published data at higher doses than Tyvaso DPI. Recall in the BREE study of Tyvaso DPI, we saw patient exposure up to 33 nebulized breath equivalents or one hundred and seventy six micrograms at fifty one weeks. Next, tolerability.

Clinical data for Tyvaso DPI show that key tolerability factors like cough and throat irritation decreased meaningfully over time. Contrary to that clinical data for Liquidia’s product shows that cough and throat irritation actually increase over time. Now turning to deposition. It has been previously shown in peer reviewed publications that the optimal particle size for pulmonary deposition is one to five microns, thus leading to effective delivery and absorption to more peripheral areas of the lungs. Tyvaso DPI particles at 2.6 microns are in the optimal size range to promote efficient medication delivery.

This feature coupled with our low flow and low inspiratory effort device has been shown to allow for the deep deposition of Tyvaso DPI in the lung. Finally, there’s ease of use and convenience and we believe that Tyvaso DPI is a better all around package for patients. Tyvaso DPI only requires one breath per cartridge four times a day. When administering Tyvaso DPI patients can hold their head position and Tyvaso DPI requires no daily cleaning where patients could potentially come in contact with DPI powder causing unwanted effects. As we begin our competitive journey with Tyvaso DPI, we understand that physicians and patients may want to try new product offerings.

However, we believe that over the long term with Tyvaso DPI’s product profile, along with the deep experience we’ve built in the pulmonary hypertension marketplace over the last three years, we are positioned for continued growth. I’ll now turn the call over to Leigh to discuss the T Hunt studies.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Thanks, Michael, and good morning, everyone. As we look ahead to the expected September data readout for our TETON-two registration study, we wanted to spend some time today providing a brief landscape of idiopathic pulmonary fibrosis, or IPF. So I’ll cover the biological rationale behind treprostinil as a therapeutic approach, provide details regarding our clinical trials, and set the stage for interpreting the forthcoming results. So, IPF is a progressive scarring disease of the lungs of unknown cause. It’s most common after age 50, and it’s linked to risk factors like smoking, genetics, and certain environmental exposures.

It affects approximately one hundred thousand people in The U. S. And currently there’s only two approved therapies for Nintenanib and Prophenidone. And these drugs only slow lung function decline. They’re used by about thirty percent of The U.

S. Patients largely due to their unpleasant side effects, yet together they generate over $4,000,000,000 globally. As mentioned, these two therapies only showed a decrease in the rate of decline in FVC at fifty two weeks in the registration studies. The mean FVC change from baseline for nantenenab was approximately 111 milliliters from placebo and 148 milliliters for perfenidone. However, the studies had very different placebo effects with over 200 milliliters of FVC loss in nanteneneb study and more than 300 milliliters for perfenadone, demonstrating the wide variety in the placebo responses that have plagued development efforts in IPF.

Many investors and even physician experts in the space believe that treprostinil is just a vasodilator, and that’s likely because treprostinil has become, it’s much more than a vasodilator. It’s likely because treprostinil has become widely used in pulmonary hypertension, but it also has activity on the IP, EP2, DP1, and PPAR receptors, collectively inhibiting fibroblast proliferation and migration, fibroblast to myofibroblast differentiation, extracellular matrix deposition, and inflammation, all of which contribute to fibrosis. These findings are supported by a post hoc analysis from our INCREASE study where a subset of pulmonary hypertension patients with IPF treated with Tyvaso showed an improved FVC and reduced exacerbations of underlying lung disease. This, along with treprostinil’s anti fibrotic properties, makes us optimistic that Tyvaso may benefit IPF patients by improving lung function through multiple pathways beyond those typically associated with pulmonary hypertension. The TETON program is made up of three studies.

TETON-one is a five ninety eight patient study of nebulized Tyvaso in IPS for participants in The U. S. And Canada. TETON-two is a five ninety seven patient study identical to TETON-one, but evaluating participants outside The U. S.

And Canada. And TETON is a worldwide study evaluating the use of nebulized Tyvaso in or progressive pulmonary fibrosis. As we’ve been saying, we expect TETON-two to report data in September, while TETON-one, which was fully enrolled in January 2025, should report data in the 2026. And our focus today is on TETON-two. So again, TETON-two is a five ninety seven patient multicenter, randomized, double blind, placebo controlled Phase III study evaluating nebulized Tyvaso in IPS patients over fifty two weeks outside The U.

S. And Canada. Full enrollment was reached in July ’4. Participants were randomized to Tyvaso or placebo starting at three breaths four times daily, or QID, titrated as tolerated up to 12 or more breasts, QID. The primary endpoint is a change in FVC at fifty two weeks, and the secondary endpoints include time to clinical worsening, time to acute IPS exacerbation, overall survival, percent predicted FBC quality of life measured by the King’s brief ILD questionnaire and change in lung diffusing capacity.

Safety is assessed via adverse events, labs, vital signs, and ECGs. Key inclusion criteria of note include subjects who are 40 or more years of age, have a predicted FVC of forty five percent or more, be on a stable dose of Nintaneb or Perfentadone if using one, and have a diagnosis of IPF confirmed by HRCT within the last twelve months. The inclusion criteria of note include obstructive diseases, high supplemental oxygen use, use of drugs commonly used for PAH, recent IPF exacerbations, or pulmonary infections. Per the TETON-one and TETON-two protocols, we reviewed the blended blinded data and adjusted the sample size considering the FCC variability, discontinuation rate, background therapy use, and regulatory feedback. And in 2024, we expanded each of these studies from three ninety six to five seventy six participants to account for observed data, patient retention, and better alignment with the other major IPF trials.

At ATS this year, we presented fully enrolled baseline data for TETON-one and TETON-two, reflecting the full populations of both studies. The baseline demographics of TETON-one and TETON-two are largely similar and compares favorably with the recently reported Fibromir IPF study and earlier clinical programs for Nanteneneb and Provenidone. While our statistical analysis plan is very long and detailed, we’ve been getting some questions in four key areas that I’d like to address. First, the study is 80% powered to detect an 80 milliliter change in FVC. This compares to a 90% power to detect a 74 milliliter change in FVC for the recent FibroNir IPF study.

Next, deaths in the study will be penalized with an FVC value at the 2.5 percentile of observed values across arms. This is based on recent feedback from the FDA. This is more conservative than the tenth percentile value used in the FibroNir IPF study. Discontinuation for other reasons will be handled through statistical models like the mixed model repeated measures or multiple imputation. Finally, we’ve had five data monitoring committee reviews that evaluated safety over the course of the studies, and the last one occurred in February, which covered more than 1,100 patients between the two studies.

To close, our expectation is that our TETON-two study will report top line data in September, as said, and TUTOM-one will report top line data in the 2026. And if both trials are successful, we intend to use the data from the studies to support a regulatory filing with the FDA to add IPF to the labeled indications for nebulized Tyvaso and setting up a commercial launch by 2027. And with that, I’ll now turn the call over to CQ to discuss TPIP.

C.Q. Ding, Senior Vice President of Biostatistics, Statistical Programming and Data Management, United Therapeutics: Thank you, Lee. It’s a pleasure to speak with you today about the questions we have concerning the TTEC Phase 2b PAH data that was recently presented. Of course, our discussions are based on publicly available information. First, we believe the patient population in the recently announced Phase 2b PAH study was imbalanced between the active and placebo groups that may have favored the treatment effect in the active group. Second, we believe inappropriate to study to analysis was conducted in the PAH study, again favoring the active arm of the study and potentially overestimating the treatment effect.

And finally, we do not see a compelling data in the Phase 2a PH ILD study that give us confidence that TPEP can be successful in a Phase three PH ILD study. We think the study population in the Phase IIb PH study was imbalanced and not reflective of PH patients who present today that are more heavily pretreated and less symptomatic than when we first developed nebulized the Thai vessel. The combined baseline 16 walking distance in Phase the 2b study was meaningfully lower, at least 45 meters lower relative to the recent clinical studies in PAH, potentially favoring a treatment effect. Most, if not all, recent PAH studies conducted this decade have had baseline six meter walking distance of 400 meters or more, reflecting improvements in the standard of care of this patient population globally. Further, there was an imbalance between the two arms of the study with baseline 16 working distance.

The 23 liter difference in baseline 16 working distance between the active and the placebo arms is more than three times that of previous well controlled studies in PAH. Of course, this favored the treatment arm of the study, potentially leading to a great treatment effect. Moving to study discontinuations, we also saw a large imbalance that could favor the active arm, with ten percent of active participants discontinued the study versus the new discontinuations within the control group. The high discontinuation level imbalance, especially relative to the control group could influence how leasing values should be imputed. Moving to statistical analysis, the change from baseline to week sixteen data is not symmetric and it’s skewed to opposite directions.

In the T PAP group, the mean value was approximately 20% higher than the median, suggesting that the data was right skewed or positively skewed. In the placebo group, the mean was 40% lower than the median, suggesting that the data was left skewed or negatively skewed. The non parametric method used to report this data in this case, rank ANCOVA and the Hodges Lemma estimate relied on the data to be symmetric or at least skewed towards the same direction. However, the right skewed data in the active arm and the left skewed data in the control arm is likely causing the overestimation of the treatment effect by Haji’s Lemma estimate or making the Hodges Lemma estimate of the location shift in readings not interpretable. Finally, there were eight subjects or twelve percent with missing data at week sixteen in the active group and zero in the control group.

A severe imbalance in dropout rate suggests that the data is not missing at random. The multiple imputation method relies on the data actually being leaving at random, which is not the case here. As such, we think this analysis may have overestimate the treatment effect of the TPAP in PAH. Beyond the concerns with the recent Phase 2b PAH data, we continue to question the earlier Phase 2a PAH ILD data. And it may not be an indicator of potential phase three success in this indication.

First, the study was extremely small in sample size with a three to one randomization ratio. There were only 10 patients in the placebo arm. So it’s difficult to draw any efficacy conclusion from the study. In addition, low baseline six new working distance was given and the six new working distance result was not statistically significant. Further, the ILD subtypes of results in the PH ILD study were not balanced between arms.

For example, only two CPSE patients were randomized into the study, but were all randomized to placebo group on a three:one triple to placebo randomization ratio. CTFE is known to be a category in which inhaled treprostinil is less effective. Finally, the safety data in the PH ILD and covers additional imbalance between arms as a five subjects or seventeen percent of active subjects had a dyspnea compared to only one subject or ten percent of subjects in the control group. Dyspnea is not a prostacyclin class adverse event and we saw more dyspnea in the control group than the active group in INCREASE study. As you can tell, we think investors have overreacted to the TPEP Phase 2b PAH data.

The baseline imbalance, the skewed data in opposite directions and aggressive statistical analysis based on the missing and random assumption may all contribute to the potential overestimation of the treatment effect. And we still have no convincing data in PH ILD. I will now hand the call to Gil Gordon, our Chief Medical Officer to outline the expected immediate impact we believe TPAP will have on the market if it’s approved.

Gil Golden, Executive Vice President and Chief Medical Officer, United Therapeutics: Thank you, CQ. We believe that investors have overreacted to the TPIP data and misunderstand the opportunity or lack thereof in the marketplace. Specifically, we do not see a near term path to market in IPF. Long term safety has not been proven. A potential launch even if it happens is many years away and our business profile will look very different if and when TPIP reaches the market.

So first TPIP lacks a clear path to approval in IPF before 2034 if Tyvaso gains approval in 2027 due to orphan drug exclusivity. Further as an ester pro drug TPIP would need to show clear clinical superiority over Tyvaso or a meaningful improvement in patient care and less frequent dosing may not qualify. The slide lists an example for LUMRIZE from Avedel that was the only recent declaration of meaningful improvement in patient care by FDA that was of the same dosage form. Next, long term safety data for a liposomal pro drug and pulmonary hypertension is lacking with the longest studies covering only sixteen weeks. For progressive diseases like PAH, PHILD and IPF robust long term data is essential.

Recent experience with sotatercept for example shows that even after FDA approval unexpected safety issues can arise over time highlighting the need for caution. So if TPIP were to pass through all these remaining hurdles, it’s still the end of the decade or even the next decade before the product will reach the market. Recent Phase three studies in PH have taken an average of three years to complete with clinical outcome studies taking even longer to complete. So if everything works perfectly, we could see a product on the market in late twenty twenty nine or 02/1930. Looking ahead to 2030 then the market landscape will likely shift significantly.

If the true if the advanced outcome study succeeds next year, Ralinepag may become the first true once daily oral prostacyclin for PAH, potentially reducing the need for inhaled therapies like TPIP. We’re also working on our own once daily inhaled prostacyclin, which is on a similar development timeline as TPIP and could serve both PAH and PH ILD. Additionally, in line with our approved and improved strategy, we are developing new Ty vaso devices and combinations to enhance convenience for patients. And lastly, by 02/1930, our organ development programs could begin generating revenue, making competition from small molecule drugs relatively minor compared to our broader long term opportunities. So to close with no near term path to market in IPF unproven safety and many, many years before reaching the market, we have little reason to be concerned about our prospects in the face of TPIP.

And with that, I’d like to turn the call back to Martin to start our Q and A session. Martin?

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Gil. Operator, you can open up the phones for Q and A.

Steve, Conference Operator: Thank you. We will now begin the question and answer session. The first question comes from Olivia Braver from Cantor Fitzgerald. Please go ahead.

Dhiv Steedman, Head of Investor Relations, United Therapeutics: Olivia, are you on mute?

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Operator, maybe you should proceed to the next question.

Steve, Conference Operator: Ms. Olivia, can you hear us?

Olivia Braver, Analyst, Cantor Fitzgerald: Yes. Can you guys hear me?

Steve, Conference Operator: Yes. Please go ahead.

Dhiv Steedman, Head of Investor Relations, United Therapeutics: Yes, we can.

Olivia Braver, Analyst, Cantor Fitzgerald: Okay, perfect. Sorry about that. Hi, good morning. Thank you for the question. Any comments on what you’re seeing in terms of Utopia uptake in both PH and ILD so far?

I mean, it looks like you’re not really seeing any impact on DPI, but appreciate anything you can tell us. And any color on why ex U. S. Nebulized Tyvaso was down sequentially, whether that had more to do with ordering patterns or any sort of demand trend that you’re seeing? And then I’ve got one follow-up question on Teton, if you don’t mind.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Olivia, there’s no more there’s so many people in the queue, there’s not going to be time for a follow-up question. Sorry. The marketing question, Michael will handle.

Michael Benkowitz, President and Chief Operating Officer, United Therapeutics: Sure. Thanks for the question, Olivia. Based on the visibility we have into what’s going on, which admittedly is not perfect, we’re things are going about as we expected in terms of the launch. Mean we finished Q2 really strong in terms of shipments and orders in June. July based on what we’re seeing so far looks really good.

So really from our standpoint, surprises in terms of what we’re seeing in terms of the launch. As I said in my opening remarks, we know that docs are curious people. There’s a new kid on the block, new product and some of them are going to want to try it out and see what it could potentially do for patients, I think particularly in light of some of the claims that Liquidia is making about their product. And so we’re seeing a little bit of But as I said, and to really kind of to wrap up my opening remarks, I think we’re really confident that with Tyvaso’s Tyvaso DPI’s product profile, plus the associated support that we provide to physician offices and patients, along with the really deep experience. I mean, really more than 10,000 patients have used DPI.

You’ve got almost 3,000 prescribers for Tyvaso DPI. So we think over the long term, that’s going to support continued growth of Tadeso DPI well into the future.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Michael. Operator, next question.

Steve, Conference Operator: Next question comes from the line of Joseph Thome with TD Cowen. Please go ahead.

Joseph Thome, Analyst, TD Cowen: Hi, there. Good morning. Congrats on the progress and thank you for taking my question. Lee called out the variability seen in FTC decline in placebo arms of IPF studies. Is there a way in the TETON trial that you attempted to standardize this?

Or is there a way to make this predictable? And when we think about any considerations in clinical practice between The U. S. And ex U. S.

Experience, what should we think about when we see the first data in September and translatability into The U. S. Trial in the first half of next year? Thank you.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Joe. Questions relating to TETON will be answered by Doctor. Kubashin.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Thanks, Marcin. Yes, so again, as you noticed, wide very wide variability in FVC measures, and this really shows in the placebo arms, especially of the two approved drugs. What we’ve done to really narrow that is we have central readers of our SEC results. And we’ve also made huge attempts at at the site level in order for training and for, you know, on the procedures and to make sure that people are doing everything consistently with regard to the pulmonary function testing. And so, that’s really been at the top of our list as far as management of these studies.

And so hopefully, will see that we have less variability, which will show better true results.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you very much, Doctor. Peterson. Operator, next question please.

Steve, Conference Operator: The next question is from the line of Jessica Fey from JPMorgan. Please go ahead.

Jessica Fey, Analyst, JPMorgan: Hey guys, good morning. Thanks for taking my question. Another one for Doctor. Peterson, which is really a question that we hear from investors. And that is how to read across from the compelling increased IPF subgroup where the patients saw improvement in FVC, but they also all had pulmonary hypertension.

And so the question is, how do we read that across to an IPF population where presumably, you know, the majority of folks are not going to

Martine Rothblatt, Chairperson and CEO, United Therapeutics: have

Jessica Fey, Analyst, JPMorgan: pulmonary hypertension. Can you address that kind of question on the read across? And if I can ask one more, it would be just whether you can touch on the circumstances under which you would deploy the share repo authorization. Thank you.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Jess. Doctor. Peterson, it’s another TETOM question for you.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Yeah, sure. Yeah, so for, I mean, as I discussed in my script earlier, treprostinil has very, you know, multiple mechanisms of actions. It works through multiple receptors. And so an increase, of course, already seen Tyvaso had already been approved for PAH. And we believe and some non clinical studies support that that really is, you know, for PAH, the main mechanism, as I also discussed, is through maybe a vasodilation function.

And that tends that at least the nonclinical studies have shown that really is working through the IP receptor to do that. But on top of it, there’s other receptors, EP2 receptor, DP1, PPAR receptors that they have additional functions that they basically, you know, as I went through, they can inhibit fibroblast activity and extracellular matrix deposition and really work on

Dhiv Steedman, Head of Investor Relations, United Therapeutics0: the

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: fibrosis end of the disease.

C.Q. Ding, Senior Vice President of Biostatistics, Statistical Programming and Data Management, United Therapeutics: And so,

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: while treprostinil does work on IP, working through these other receptors, we believe that it can work on fibrosis, which means it would be effective in IPF and So again, multiple mechanisms of action would lead to efficacy in multiple indications.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Superb answer Doctor. Peterson. James Edgemond, could you kindly address Jess’ question regarding the buyback?

Dhiv Steedman, Head of Investor Relations, United Therapeutics1: Yes. Thanks, Martine. And Jess, thanks for the question. Good to hear your voice this morning. We did announce this morning that our Board of Directors authorized a share repurchase of up to $1,000,000,000 of our shares and we plan to implement this Board of Director authorization expeditiously.

As a little bit of background, maybe as to why now, it really is given the continued strength of our commercial business, our robust balance sheet, our confidence in our upcoming catalysts and our belief in our share price potential, we and the Board of Directors concluded that now was the right time to authorize this share repurchase. And like many shareholders we’ve met with, we believe the return of capital represents confidence in our near term as well as long term business prospects. And we share the view of many shareholders that our stock is an excellent investment opportunity. So Jeff thanks for the question and Martine back to you.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you so much for that great response James. Operator you may take the next question.

Steve, Conference Operator: The next question is from the line of Roger Song from Jefferies. Please go ahead.

Dhiv Steedman, Head of Investor Relations, United Therapeutics2: Great. Congrats for the progress and thank you for taking our question. Also a question related to Qi Tom. So given the increased subgroup data and then the powering assumption 80% detect the 80 ml difference, so what will be considered clinically meaningful for FVC results from that trial? And then what will be the homerun scenario from that trial?

And then also follow-up on Jessica’s question earlier. So do you have a sense or any top level comment on how many patients from the TETON is actually having the pulmonary hypertension with the IPF versus a pure IPF? Thank you.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Roger, for that concatenated question. It’s all basically in the domain of biostatistics. So I’ll ask Doctor. Deng to kindly answer that question.

C.Q. Ding, Senior Vice President of Biostatistics, Statistical Programming and Data Management, United Therapeutics: Since the T1 study, are testing the anti fibrotic effect, not the vessel dilate effect. So we design our study that to enroll the patient similar to other IPF studies, not try to design the study similar to previous PH ILD studies. So we actually did not perform the hemodynamic measure to actually determine if the subject had pulmonary hypertension or not.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, CQ for responding to Roger’s question. Operator, you could open the line for the next question.

Steve, Conference Operator: The next question is from the line of Andreas Argyris from Oppenheimer. Please go ahead.

Dhiv Steedman, Head of Investor Relations, United Therapeutics0: Good morning. Thanks for taking our question. Congrats on the quarter, all the positive updates. Appreciate the additional color here. I wanted to ask about Ralinepag.

With the PH space moving towards more convenient dosing, can you share your thoughts more on the Ralinepag opportunity with once daily oral dosing and the powering assumptions from the advanced outcome study? And then just a quick question for Doctor. Peterson. You mentioned the refined imputation for TETON2. Can you expand on how that method aligns with the FDA expectation on whether this adds confidence and the strength of the upcoming readout?

Thank you.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: All right, Andreas. Thanks for the kudos on the quarter. And both of those questions are really within Doctor. Peterson’s domain. So Doctor.

Peterson, could you address them?

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Yeah. So I guess, for the powering, I’m not sure that I got all of the questions. But the powering for Ralinepag, it’s powered at 80% to detect a treatment difference, the point six five hazard ratio. So that’s for clinical worsening events. And we’re on target to achieve the number of clinical worsening events to be able to see a difference and to detect a treatment difference by the end of the year.

And so I think that was your question about the powering. And then you had a Teton question and I didn’t quite get all of that. I’m sorry.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: And James, can you repeat your Teton question? He’s out of the queue now. Okay. Well, I’m sure IR can follow-up with him. Operator, can you answer the next question?

Steve, Conference Operator: Yes. The next question is from the line of Ashwarma from UBS. Please go ahead.

Joseph Thome, Analyst, TD Cowen: Yes. Thanks for taking my question. So I wanted to ask about the design of ketone studies, specifically about the potential amputation of measurement for discontinuation for the protocol. So in this case, based on your protocol, would these be reported as a missing or a zero or excluded from the analysis? So that’s one.

And then secondly, to the extent like there is ibiso induced cough in the study, wouldn’t that mean functional unblinding if patients are only seeing that in the ibiso arm? Thanks.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Okay. Thank you, Ash, for that question. I’d like to ask CQ if he could answer the first part of the question, CQ if you got it all. And then Doctor. Peterson to answer the second part of the question on the unblinding.

C.Q. Ding, Senior Vice President of Biostatistics, Statistical Programming and Data Management, United Therapeutics: I’ll address that potential unblinding due to the cause event. Actually, based on the previous study, even the patient who are randomized to placebo group, they will also experience some cough event. So it’s a lot just once you see there’s a cough event, you can guess that the subject will be in the active arm. So you probably see a little more cough in the active group than placebo group, but placebo patient also experienced a cough event. So we don’t think that unblinding, potential unblinding is an issue there.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Sichu. Doctor. Peterson, since Sichu answered kind of the second question, do you want to comment on the first question?

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Yes. So we talked quite a bit about the deaths, how they’ll be penalized with the SVC value at two point five percentile of observed values, and then discontinuations for other reasons will be handled through statistical models like the mixed model repeated measures or multiple imputation. And, yeah, and I agree with what CQ said. I mean, we it’s just like any study where there’s a known AE that can be associated with the treatment, but very often, you know, there’s a similar AE that’s seen with the placebo and we, I mean, we generally are we definitely are surprised at the end of the day sometimes where we see things, we think, oh, yes, maybe that’s not active because of cough. It’s definitely not.

So I would say there’s no risk, and especially in this study of cough because people cough a lot just by inhaling placebo. So no worries there.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Perfect, Doctor. Peterson. Thank you so much. Operator, can you take the next question, please?

Steve, Conference Operator: The next question is from the line of Jason Gerberry from Bank of America. Please go ahead.

Dhiv Steedman, Head of Investor Relations, United Therapeutics3: Hey, guys. Thanks for taking my question. Mine’s also just on IPF. And I guess the physician KOLs seem to think that the NeurodomaLast data at ATS were pretty underwhelming, just the neutral benefit on exacerbation as a secondary endpoint and the lack of a p value in the monotherapy subgroups. I’m just kind of curious, how important is it in your view to show a meaningful improvement on the exacerbation as well as sort of establish with stats benefit maybe in a pooled manner in the monotherapy subgroup?

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you so much for the question. And Doctor. Peterson, I think you’d be the best person to answer it.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Okay. Yes. So I mean, yes, there was definitely a positive study for the Thybronir IPS and But and they met their endpoints. They had 90% power to detect a 74 milliliter change in FVC. We’re 80% power to detect 80 milliliter change.

But we, you know, obviously we look forward to seeing events or seeing results where, you know, there’s ideally we would see that our Tyvaso is disease modifying and that patients don’t decline. However, we may see a slight decline or more decline, but we fully anticipate having a clinically meaningful effect, which would be greater than an 80 milliliter change in FVC. So again, but blinded, we will know in September.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Well, thank you so much, Doctor. Peterson. That’s an excellent answer. And operator, you can take the next question.

Steve, Conference Operator: The next question is from the line of Terence Flynn from Morgan Stanley. Great.

Michael Benkowitz, President and Chief Operating Officer, United Therapeutics: I’ll stick to one. Just on TETON, when you look at background therapy from the INCREASE study, it looked like there was maybe a difference in terms of patients that were on background TKI versus those that were on no background TKI. And so maybe you could just talk through that dynamic. And then as we think about the Phase three, the mix there and how that might impact the overall treatment effect that you’re expecting to see? Thank you so much.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Thank you, Terrence. Good to hear your voice this morning. Doctor. Peterson, you’d be the best person.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Yes. So we I mean, definitely versus increase, we see more background therapy use in both TETON-one and TETON-two as shown on one of the slides that I went through today. TETON-one and TETON-two have, you know, seventy seven percent background therapy use and seventy five percent. So it’s more I mean, it can just like any again, any study when you have effective background therapy, then it can mute your efficacy of your investigational drug. But, again, we’re right in there.

FiberNeer IPF also had, you know, seventy eight percent use of background therapy. And there’s a lot of room for improvement. I mean, I also showed the slides that the patients even on the active background therapies have, you know, have a significant decline in SVC. So there’s a lot of room for improvement and this is exactly what we expected as far as the use of background therapies. So, again, stay tuned in September, but that doesn’t it’s not a concern.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Doctor. Peterson, thank you so much. And just because you’ve been on the phone so much answering these questions, I do want to toot your horn for a moment to make sure these questioners understand your expertise, that you are the lead author on the New England Journal of Medicine publication on our INCREASE study. In addition to being the lead author of our physiological reviews publication on xenotransplantation. So folks on the phone, your privilege really to hear from such an expert source as Doctor.

Peterson. Operator, I think we’re ready to take the second questions from people. So next question.

Dhiv Steedman, Head of Investor Relations, United Therapeutics: Martin, there’s no more questions in the queue, but I do have Andreas’ follow-up question. And he was asking, can you expand on how the FVC imputation method in Teton aligns with FDA expectations and whether this adds confidence in the strength of the upcoming readout? So it relates to the recent change and how we handle deaths in that study.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Sure. Well, since we have the New England Journal of Medicine lead author in this field on the line, we’ll ask Doctor. Peterson to answer.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: Yes. And I must correct. I’m not lead, but I’m one of them for that one. But thank you, Martine. Very, very good.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: But I think you are the boss of the lead.

C.Q. Ding, Senior Vice President of Biostatistics, Statistical Programming and Data Management, United Therapeutics: Okay.

Lee Peterson, Executive Vice President of Product Development and Xenotransplantation, United Therapeutics: What was the question? Yes. So, we have our statistical analysis plan is, you know, very lengthy and very long, and all of that is submitted to FDA for their feedback. And so, and often they and they have given us feedback. Again, we’ve talked extensively about the death penalty with them.

This is what this is the current feedback as just, you know, just a few weeks ago. So that’s already set. And then CQ and his group have been in conversations with FDA about, as was true for INCREASE, the same for these studies where, you know, what specific statistical models should be used and how to impute the measures. Again, the mixed model repeated measures or multiple imputation.

Martine Rothblatt, Chairperson and CEO, United Therapeutics: Perfect. Thank you so much, Doctor. Peterson. Thank you, folks on the call. Operator, you can wrap up the call now.

Steve, Conference Operator: Thank you for participating in today’s United Therapeutics Corporation earnings webcast. A rebroadcast of this webcast will be available for replay for one week by visiting the Events and Presentations section of the United Therapeutics Investor Relations website at ir.unither.com. Thank you.

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