Hello. Hello, I'm Shan Hama from the European Pharma Biotech team here at Jefferies. Today I have with me the CFO of Formycon, Enno Spillner, and he'll be giving a short presentation, and then we'll go into the Q&A portion of this session. Thank you.
Yes. Thank you, Shan, a warm welcome to everyone from my side as well. Great pleasure having you here. First of all, thank you to Jefferies for hosting this event and the conference once again. It's a pleasure being here and updating you on our latest achievement and progress on Formycon as we move forward.
You all know this kind of slide, and I just kindly ask you to apply appropriate care on our forward-looking and optimistic statements due to certain risks and uncertainties that we do not control, and therefore, please interpret our numbers and statements with care.
For those of you who don't know Formycon yet, we are a company, we are fully owned and only dedicated and focused on the development of biosimilars. That's our core focus, that's our expertise, and that's where we have assembled all our knowledge and expertise and platforms around.
That means we have about 200 employees located in the Munich area, all under one roof. Most of them obviously dedicated to science and development of new biosimilars, and are combining really a high level of seniority, professionalism, and track record that we have assembled over the years building that biosimilar platform.
On which basis we have built a very attractive and nice biosimilar portfolio, which I will introduce in a couple of minutes to you in more detail, consisting today of seven assets from different fields of indications.
Therefore, we are a player that is positioned in a way that we can select, analyze, develop, and approve new biosimilars across all different kind of indications, and therefore also being a very attractive partner to other industry players who want to introduce biosimilars to patients and doctors, and do the respective sales and marketing.
Not all of them can select and develop biosimilars. This is what we can offer and do on our platform. Of course, with that, we have a very clear mission which is dedicated to providing more access for more patients to effective and efficacious therapeutics being available at a heavily reduced price.
This means access for more patients or earlier access for patients for treatments, because sometimes biologics are, especially in Europe, only applied quite late in the treatment regimen. If you can move that up the value chain, that is certainly helpful for patients.
The other part is taking off the financial strain from our healthcare system, especially in the Western world, by significantly reducing prices for good and efficacious drugs being available for the respective patients.
I think I don't have to convince this audience here today about the future upside and potential of biosimilars. Just reminding you that more biologics are running off exclusivity in the next years to come. Just looking at the major blockbusters, which is in the next couple of years around 40,
We are looking at a market potential of the originator volume, of course, of roughly $200 billion coming off exclusivity. There's a huge amount, a huge upside. To be added recently, by the change in attitude of the FDA, but also the EMA, that phase III is not necessarily required anymore as a development part of biosimilars.
The barrier is reducing even to go into what we call niche busters, assets in the range of EUR 500 million-EUR 2 billion, which in the past were maybe not fully attractive from a return on investment perspective, with that change, cutting timelines and costs significantly going forward for biosimilar development, that's adding actually to what we see here on the slide. The potential is even further broadening.
Already today, more than 50% of all originator products that are losing exclusivity or have lost exclusivity already are not being covered by biosimilars. There's an urgent need and demand for more capacity and more biosimilar players pushing forward, and certainly Formycon will play a crucial role here in the future. This growth that we see is across the major markets, Europe and in the U.S.
In the U.S., even more dynamics in the recent years, but also other regions are joining, so MENA or LATAM, APAC becoming more and more relevant, especially for a smaller player like Formycon. This is why we really carefully select our partners for the respective regions going forward and trying to take advantage of the local or regional activities of certain players.
I'll come back to that when talking about our products in more detail. To maintain this momentum and take advantage of that, Formycon is focusing on what we call our fit for growth strategy, which is consisting of four major pillars. Number one is really geographical diversification.
Not only focusing on Europe and the U.S., but obviously also looking at other emerging regions like, as I said, MENA or LATAM, where we clearly feel that things are better coordinated now, things are well-aligned, and with the reduced prices, more of these products are becoming attractive for patients and health organizations in this region, and they can afford them if they are on a biosimilar level with regard to the pricing perspective.
Really here, diversifying beyond the U.S. and Europe for us is a key objective in the next years to come. That goes well along with what I indicated already before, having a smart mix of portfolio between large-scale assets like Stelara or KEYTRUDA or others, but also what I call the niche busters before, having smaller ones. Obviously also being diversified across different indications that we have ongoing already.
Really here, selecting very carefully products of the future is one of our key expertises and focus topics that we are working on to have a broad and diverse portfolio in place. Of course, to the third pillar about excellence and innovation, biosimilars, we cannot bring a new breakthrough therapeutic approach, because that's simply not our business model.
Within biosimilars, we can still be innovative by, for instance, introducing a prefilled syringe for the first time in Europe, or working on an auto-injector like we did recently with Fresenius Kabi for our FYB202, namely Stelara biosimilar.
For the first time, filing for a second BLA in the U.S. for a biosimilar, which is kind of unusual in this part, and I'll come back to this later once again. Really trying to be creative, pushing innovation in other fields for devices and applications as an example.
Last but not least, being competitive from the cost and organizational point of view. Certainly, cost during the development period, but also later on COGS during being on the market with a mature product is of essence. Therefore, we really make sure at Formycon we stay lean, and you heard in the beginning,
As I said, we have about 200 people who are covering the full value chain, and we are very agile here and very flexible in taking up any challenge that is coming along the value chain. Staying focused, staying lean, taking advantage of automatization, digitalization, AI, going forward in the development is one of our key objectives to stay competitive against other players. This is a snapshot of our pipeline as you can see it today.
It consists of seven products, and what you can see clearly is we are agnostic in terms of indications. We have ophthalmology, we have immunology, we have immuno-oncology, and we could also go in other indications that are not yet on the list. In this regard, we have no limitations from a technical point of view or from an indication point as well. Out of these seven products, three are now in the market.
Lucentis, Stelara, and very recently Eylea have now been launched, Eylea in Europe, and will then follow later this year also in the U.S. In the end, we have now three products where we have the full track record from selection of the product up to market approval. We have never experienced any kind of delay in terms of Complete Response Letters or setbacks of this kind.
The quality level while we develop these assets is extremely high at Formycon, and we are really fully dedicated to pushing these products through. You can see there's some very renowned assets in here like Stelara, Eylea, KEYTRUDA. DUPIXENT has been recently disclosed last fall once we achieved what we call TPOS, technical proof of similarity. This is being prepared for the clinic as we move forward.
It's a diverse portfolio, and of course, we also want to add further assets in the future, extending the seven assets beyond what you see here today. Right now we are very busy with accelerating those that are in the market and getting KEYTRUDA obviously ready, where we have very recently completed our phase I/PK study very successfully.
We are now wrapping up the data, getting ready to file with the authorities, or especially with the FDA here going forward. We had a lot of positive news along that part as well already. Speaking of positive news, let me at least summarize the highlights so far for our 2026 year that we started, where we have already ticked quite a few boxes. With regard to FYB201, which is our Lucentis biosimilar, we continue to launch in other regions across the world.
I mentioned the regional activities that we have, for instance, for Brazil. Also with FYB206, our KEYTRUDA biosimilar, we have added a new partner for the APAC region, not covering all of APAC, but significant part of that. We are planning also this year to announce further activities in the field of LATAM and, of course, also further APAC activities.
Europe, which is not yet partnered for our KEYTRUDA asset, probably is going to come in 2027. We don't have a lot of pressure here as the loss of exclusivity comes a bit later compared to the U.S., for example, going forward. On the portfolio progress, FYB201, LUCENTIS is being relaunched in the U.S. It was paused by Sandoz for a while.
Very interesting, we have added a second BLA and a second permission now for the U.S., and having a second partner now with Sitos who's awaiting their start. We assume that Sitos will launch in the U.S. in parallel to Sandoz during the course of the second half of the year. That's quite exciting for us, not only having one, but two partners for this product in the market. FYB203, which is our STELARA, sorry, our EYLEA biosimilar.
Here, I mentioned already the settlement with Bayer/Regeneron for Europe, which allowed us to launch the product in mid-May of this year. That is happening now as we speak. The launch in the U.S. stands ready. We have settled last year with Regeneron that we are allowed to launch in Q4 of this year. That's really good progress that we are seeing here going forward.
I also mentioned the field of excellence and innovation, here just a few topics. I mentioned already the PK study successfully concluded for our KEYTRUDA asset, where we are preparing now the submission, also for 208, our DUPIXENT asset, we are getting ready for the clinic, preparing things, most likely we will enter the clinic here in 2027 going forward.
I also mentioned the auto-injector that we have recently achieved, or where we have recently achieved approval in Europe together with our partners from Fresenius Kabi, which by the way, also triggered a milestone payment to our benefits, which was very helpful for revenue recognition in Q1, certainly.
Last but not least, fit for future, staying lean, really reviewing internally, how can we improve, how can we move faster at reduced cost, and certainly here also alignment with further or future potential CDMO partners across the world is one of the key topics, because this is not only key during the development phase of a product,
But in the end, costs will be one of the key success and differentiating factors in the future, being competitive while you are on the market, and therefore you need the right partner in place who is not only cost competitive, but also on a high quality level, very reliable in terms of amounts being agreed to deliver.
I will not go into the details of these slides for every single product. What I would like to explain to you and get across is that we have shifted our strategy a little bit in terms of partnering. While in the past we would go really for exclusive, larger collaborations across the world, we changed gears here a little bit and now breaking things down into more regional or more local deals,
Because we clearly feel that you need that local expertise in the specific region, that the local players have quite a lot of momentum, and they are very engaged because they only make their money in a certain region, and therefore they are fully committed for this region. That's a little bit more administrative for us because we need more contracts with different players.
In the end, we clearly think it will pay out as these players are very knowledgeable in their respective region and fully committed. The second part is that we try to walk away from exclusive deals, but having semi-exclusive agreement, pushing a little bit for competition and taking advantage of several players running in parallel for a certain region.
That applies obviously also for other assets, maybe on Stelara here, just to remind you that we are still in the launching phase together with Fresenius Kabi in particular. Also Teva or ratiopharm is pushing here within Germany, for instance, MS Pharma is our player across basically the whole pipeline today, our first leading assets for the MENA region. They are kind of repeat partner for us.
FYB203, which is our Eylea biosimilar, as I mentioned already, that we recently launched in Europe or about to launch right now and U.S. to come. This is very exciting because it really confirms that we now have three products in the market at the end of this year. For a company like Formycon, that's a great success going forward. KEYTRUDA is certainly one of our future value drivers that we clearly see today.
We are really pushing hard here to get this forward, and we think we are within the leading group of developers right now from what we can see. Of course, not everyone discloses all details, but with having concluded our phase I PK study in February of this year, I think we are progressing quite well.
What is also important to know for you, we partnered already for North America end of last year with Zydus. Zydus is very committed to biosimilars and recently, due to their strategic measures, they also have manufacturing in India and in the U.S. and they also based on their other products that they have and their hospital approach,
They have a good oncology network within the U.S. that they keep expanding, and this is one of the reasons why we think this is a highly attractive player going forward. We have partnered for the MENA region, once again with MS Pharma, as I already indicated, and Lotus for the APAC region. Operational progress, partnering progress, and more news to come, hopefully during the course of 2026.
I skip DUPIXENT and remind you of the numbers which we just recently published in context of our Q1 report on May 28th. What you can clearly see for 2026, we are expecting significantly increased revenues in the range of EUR 60 million-EUR 70 million. Q1 was already a good head start here with EUR 13 million of revenues being realized. That's a significant uptake compared to last year at the same time, we reported EUR 5.2 million.
Here you have a significant step up. The same applies for EBITDA and the adjusted EBITDA, where we still last year at the same time had been at low teens negative EBITDA. That's changed quite a bit. We are improving. We are clearly targeting to have a black zero as our target for 2026. At this point in time, we think that is absolutely feasible.
This is not a one-off, but this should really confirm the turn in a way that from then onwards, we grow our EBITDA and have a sustainable, profitable or EBITDA profitable organization going forward. Maybe also important for you to know is we have a fairly stable set of anchor investors accompanying Formycon since multiple years, actually. With the Santo Holding, behind them being the Strüngmann family,
But also Wepart or Gedeon Richter as a strategic partner, by the way. They are basically covering roughly 50% of the organization. The rest is free float that we have today available of investors, a lot of retail investors, and today, still a little bit Europe or DACH region-focused. Of course, the reason why we're here also in the U.S. is we want to extend this. We want to attract also international and institutional investors.
With products being on the market here in the U.S., we think we have good reason to tell the story also here in the U.S. On that basis, I just repeat, Formycon clearly dedicated to biosimilars, full focus on this class of assets. We have all the ingredients in-house at Formycon to select, to analyze, to develop, and to approve respective products together with our partners like Teva, like Fresenius Kabi, Sandoz, and other renowned players in the industry.
We will continue to do so and therefore be one of the key players delivering new biosimilars into the market. That's what we stand for, and this is where we will continue to work on. With that, I'm at the end of my high-level presentation and open for Q&A from the audience or from Shan. Thank you.
Thank you so much. Firstly, are there any questions from the audience from the presentation? Okay. Thanks so much for that. Let's think about the KEYTRUDA asset, because I think that's very interesting. We know that there's a number of players who are trying to enter that space. What are the next steps for you following the positive study readout? After, could you explain a little bit about what we could expect in a potential partner for that asset?
Yes. First of all, it's not at all a surprise that this is a competitive asset. Last year, we have seen $32 billion of revenues growing, so the asset is still increasing. In that regard, it is totally clear that competition is to be expected.
Currently, we think the leading group is probably Sandoz, Samsung, Celltrion, and us, who are really kind of on the front, at least from what we see and what we perceive, and we feel very well positioned within that group going forward.
As I said, we have recently concluded on the phase I/PK study with data which we think should be sufficient based on the discussion that we had last year with the FDA, where, by the way, Formycon was the first one to have a positive interaction with the FDA, which led to a scientific advice at the FDA allowing us, obviously, to waive the phase III. Other players followed.
Again, this shows a little bit the "innovation" or agility character of Formycon that we really try to push things here and go new ways that others have not gone. Where are we? We are in the partnering stage and have successfully concluded on a couple of deals, especially Zydus joining us for North America with a good upfront payment, with first milestones being achieved. That's certainly a key one.
Europe, again, we don't feel a lot of pressure to partner right now, we will hold that back a little bit and kind of looking for the best suitable partner going forward. We will continue to partner for other regions like LATAM for certain countries or in the APAC region, that's probably where the news flow is coming from in the next month.
I cannot or will not disclose the exact date when we intend to file for competitive reasons. I hope you understand that. You can be assured that we're doing everything to wrap up the data on a high-quality level right now then basically file as soon as possible with the FDA for approval.
On that basis, looking at the current timeline, I think it's realistic that if things go well and according to plan, that an approval within 2027, latest 2028, is absolutely feasible. Yeah.
Makes sense. Thank you for that. You also have FYB208, which is the DUPIXENT asset. Also very interesting, big commercial opportunity. Could you perhaps tell us how you're thinking about Sanofi's ambitions to potentially delay the loss of exclusivity and sort of how that informs your plans for that asset?
Yes. I assume, just as a background for those that may not have heard about it, that Sanofi made some statements here that they think they can push out the IP extension, so to say, up to, I think, 2031 it was. We clearly are monitoring that. Overall, again, it's not a surprise that the originator always tried to find some ways to secure certain parts of the assets or simply maintain or prolong the exclusivity in general.
We have seen that with Eylea, with Regeneron applying the high dose as a new offer or now also on KEYTRUDA with Merck developing the SC, subcutaneous version rather than IV, and trying to extend the IP part is obviously another approach. You always have to be prepared for that.
From what we see right now, we cannot fully follow the approach that has been mentioned here by the originator. Of course, we will take a look at that. We will reevaluate that. From what we see today, we are not too concerned about this potential prolongation, honestly, and we currently remain with the assumption that the old approach still is in place. We will review.
Makes sense. We think about Cimerli, which is your Lucentis biosimilar. We know that a while ago it was removed from the market, and it's recently been reintroduced by Sandoz, your partner. Could you potentially provide us with some insight as to how that reintroduction is going and what Sandoz's strategy is there to ensure that the same things don't happen again?
Yeah. What happened here, as a reminder, for those who are not familiar, Sandoz last year, after Q1, decided to pause the product on the market in the U.S. for a while. They came back. That's great. Early this year, Sandoz relaunched the product into the U.S., and of course, that is combined with significant hopes on our side that they will again cover a significant part of the market.
When they left the market, they were in a market share position of 40%-45%, if I recall correctly. It would be great if they can upswing again. Of course, it's too early to judge. They only started in January of this year, and now in the first couple of months, we do see an acceleration, but obviously starting from a very low level, that requires some monitoring.
We think it's encouraging, as this is in the buy-and-bill market. There's certainly price pressure that they have to monitor and making sure that the ASP trap doesn't hit the product. From what we see right now, they're probably in the lower price segment within the biosimilar range here right now, and then now accelerating the units being sold. That's all I can say from what we see today.
That's very clear. Actually, if we zoom out on pricing, particularly in the U.S., are we seeing sort of irrational generics pricing, or would you say that things are sort of stabilizing?
That's a good question. I would say, again, also DUPIXENT is a large product. Again, here, competition is to be expected and is already visible from what we know today. It will be competitive, and that's part of our market. That's what we all prepare for. Again, you need to differentiate between the buy-and-bill market and the PBM controlled or regulated market, and for us,
The PBM market is the more critical one than the buy-and-bill part. In that regard, you have to differentiate a little bit on where things are going. In the buy-and-bill market, you see that things are more stable, that prices are not so much under pressure from day one, and there's more consistency also over long period. In the PBM market, that's different.
There you have steep drops from day one. That's something that will probably remain that way unless the regulator or the U.S. authorities here change the system, where there have been some indications for that. Some political statements also earlier this year, where they said they want to change the PBM approach.
It's unclear, at least from our point of view, when and how that exactly is going to happen. That certainly would unlock a lot of additional value for biosimilar players, because that's certainly a gate where everyone tries to get through, and that causes the deep drop in the pricing, and that could be avoided in a certain way.
That's very clear. Thank you. If we think about Otulfi or FYB202, which is in partnership with Fresenius, in your 1Q 2026 call, you mentioned that Fresenius' U.S. team had secured a contractual agreement for Otulfi, with a large federal buyer. Could you elaborate on what this means for Formycon and sort of the revenues that can be generated from that?
Yes. Obviously, Fresenius Kabi tries to strike additional deals like they did last year successfully with CivicaScript, and then these partners do upload their stock, so to say, and that then triggers revenues for us. That's why, for instance, in Q4, we had fairly good revenues from Otulfi in the U.S. on that basis. This will also cause the product for us to go a little bit in waves,
because if a contractual partner in Q1 is not stockpiling, and they don't do that every quarter, but maybe every Q4 or so, then that means that there's no revenue coming from that particular partner. Adding new partners for us is really good news and very encouraging. That's exactly what we are hoping and aiming for, that Fresenius can deliver on this. We don't know any details, not much more than the public knows.
We know that it's obviously some federal organization behind that, which is clearly encouraging, and that the management of Fresenius Kabi stated in their Q1 call that it is in a range of up to EUR 140 million of revenues within the next four years.
For us, that's clearly positive news. We also now are curious for the details. That's exactly where we would love to see more of, and obviously supporting Fresenius where we can from our side to make this happen, to be competitive and having an attractive product in place.
Brilliant. I think we're at time. Any questions? No. Thank you so much, Enno. Really appreciate your time. Thanks everyone for joining.
Thank you.