Executive Summary / Key Takeaways

• BioMarin Pharmaceutical Inc. is undergoing a significant strategic transformation, focusing on its core Enzyme Therapies and Skeletal Conditions business units, which collectively delivered 11% year-to-date revenue growth in 2025.
• The company reported robust financial performance in Q3 2025, with total revenues of $776.1 million and year-to-date operating cash flow of $728 million, contributing to a strong cash and investments balance of approximately $2 billion.
• A key strategic shift involves the decision to divest ROCTAVIAN, a gene therapy for severe hemophilia A, to sharpen focus on higher-priority assets and business units.
• BioMarin's pipeline is advancing with promising candidates like BMN 333 for achondroplasia, aiming for superior efficacy, and BMN 401 for ENPP1 deficiency, acquired through the Inozyme Pharma acquisition, with pivotal data expected in H1 2026.
• While the specific $4 billion 2027 revenue target has been rescinded due to competitive uncertainties, particularly for VOXZOGO, the company maintains a 2026 non-GAAP operating margin target of 40% and sees significant opportunity for growth through strategic business development.

A Rare Disease Powerhouse Evolves

BioMarin Pharmaceutical Inc., established in 1997, has carved out a distinctive niche in the biotechnology landscape, dedicated to developing and commercializing transformative therapies for life-threatening rare diseases. The company's foundational strength lies in its specialized focus on genetically defined conditions, a strategy that has culminated in a portfolio of eight commercial therapies and a robust clinical pipeline. This commitment to addressing high unmet medical needs has positioned BioMarin as a leader in orphan diseases, a sector characterized by significant barriers to entry due to high research and development costs and complex regulatory pathways.

The company embarked on a strategic transformation in 2024, reorganizing its operating model around two core business units: Enzyme Therapies and Skeletal Conditions. This initiative, coupled with a $500 million cost transformation program, aimed to amplify financial performance and accelerate innovation. This strategic pivot is now yielding tangible results, with BioMarin leveraging its deep expertise in rare disease drug discovery, development, manufacturing, and global commercialization to drive value for patients and shareholders alike.

Technological Edge and Innovation Engine

BioMarin's competitive moat is significantly reinforced by its differentiated technological platforms, particularly in enzyme replacement therapies and C-type natriuretic peptide (CNP) analogs. These technologies underpin its commercial success and future growth prospects.

VOXZOGO (vosoritide), the company's flagship product in the Skeletal Conditions unit, exemplifies this technological leadership. As a once-daily injection analog of CNP, it directly addresses achondroplasia, the most common cause of dwarfism. Beyond its proven impact on annualized growth velocity, recent data presented at the American Society for Bone and Mineral Research (ASBMR) in September 2025 demonstrated VOXZOGO's positive influence on spinal morphology in children under five. This includes improved spinal measurements across all lumbar vertebrae and an overall improved curvature of the spine after just one year of treatment compared to placebo, suggesting benefits beyond height and potentially reducing the risk of spinal stenosis, a leading cause of morbidity in achondroplasia.

Building on this success, BioMarin is actively developing BMN 333, a next-generation, longer-acting CNP for achondroplasia. Phase 1 healthy volunteer data revealed free CNP levels more than three times greater than those reported for another long-acting CNP, with no safety signals observed. This significant increase in exposure is anticipated to translate into superior efficacy compared to VOXZOGO, with preclinical data showing roughly double the attributable growth at high free CNP exposures. The company plans to initiate a Phase II/III registrational study in the first half of 2026, aiming to establish BMN 333 as a new standard of care by 2030.

In the Enzyme Therapies segment, PALYNZIQ (pegvaliase-pqpz) showcases the power of enzyme substitution. Positive pivotal Phase 3 data in adolescents (12-17 years old) demonstrated a 49.7% decrease in mean blood phenylalanine (Phe) levels, offering the potential for normal Phe levels and an unrestricted diet—a transformative benefit for PKU patients. This underscores the company's ability to develop therapies with profound, quantifiable patient benefits.

The "so what" for investors is clear: BioMarin's continuous investment in and refinement of its core technologies create a sustainable competitive advantage. These innovations translate into best-in-class or first-in-disease therapies that command strong market positions and pricing power, driving long-term revenue growth and profitability.

Financial Fortitude and Strategic Allocation

BioMarin's financial performance in 2025 reflects the initial successes of its strategic transformation. For the nine months ended September 30, 2025, total revenues reached $2.35 billion, an increase from $2.11 billion in the same period of 2024. Net product revenues for the nine months ended September 30, 2025, were $2.31 billion, up from $2.07 billion in the prior year period. This growth was primarily driven by the Skeletal Conditions and Enzyme Therapies business units.

VOXZOGO continued its strong trajectory, with net product revenues of $653.5 million for the nine months ended September 30, 2025, a 24% increase year-over-year. PALYNZIQ also demonstrated robust growth, with net product revenues of $308 million for the nine months ended September 30, 2025, up from $254.6 million in the prior year period. While Q3 2025 VOXZOGO sales were slightly down quarter-over-quarter due to the timing of large international orders, management reaffirmed the full-year 2025 VOXZOGO outlook of $900 million to $935 million, representing 25% growth at the midpoint.

Profitability, while impacted by a one-time event, remains a key focus. The third quarter of 2025 saw a GAAP net income of $30.7 million, a decrease from $106.1 million in Q3 2024, primarily due to a $221 million acquired In-Process Research & Development (IPR&D) charge related to the Inozyme Pharma acquisition. However, looking past this charge, year-to-date GAAP and non-GAAP diluted earnings per share increased, driven by strong underlying revenue performance and operational efficiencies. The gross margin expanded during the three and nine months ended September 30, 2025, primarily due to a favorable product mix and reduced ROCTAVIAN inventory reserves.

BioMarin's liquidity position is robust, with approximately $2 billion in cash, cash equivalents, and investments as of September 30, 2025. The company generated $728 million in operating cash flow year-to-date, demonstrating its ability to self-fund its growth initiatives. Management views business development as the greatest opportunity to drive significant incremental top-line growth, estimating a total "firepower" of $4 billion to $5 billion, combining existing cash and leverage from its growing EBITDA profile.

Portfolio Evolution: Sharpening the Focus

A significant strategic decision announced in October 2025 was the pursuit of options to divest ROCTAVIAN, its gene therapy for severe Hemophilia A. This move aims to streamline BioMarin's portfolio and concentrate resources on business units aligned with its strategic priorities. While ROCTAVIAN is an innovative therapy, this divestment underscores BioMarin's commitment to optimizing its asset base for maximum impact and value creation, ensuring the therapy can reach its full potential under alternative ownership.

Conversely, the acquisition of Inozyme Pharma, Inc. in July 2025 for approximately $285 million (net of cash acquired) strategically strengthened the Enzyme Therapies portfolio. This acquisition brought BMN 401 (formerly INZ-701), a late-stage enzyme replacement therapy for ENPP1 deficiency, a condition with high unmet medical need. Pivotal data from the ENERGY III study in children aged 1 to 12 is anticipated in the first half of 2026, with a potential launch in 2027, positioning BMN 401 as a potential first-in-disease medicine.

Competitive Arena: Defending and Expanding Dominance

BioMarin operates in a highly competitive rare disease market, where its specialized focus provides both advantages and vulnerabilities. The company's primary competitive advantage stems from its proprietary technologies and first-mover status in several indications.

In achondroplasia, VOXZOGO currently holds a leading position as the only approved therapy. However, the competitive landscape is intensifying with two notable competitors: Ascendis Pharma (TransCon CNP) and BridgeBio (a small-molecule drug). Ascendis Pharma has a target action date of November 30, 2025, for TransCon CNP, which offers a weekly injection compared to VOXZOGO's daily administration, potentially presenting a convenience advantage. BioMarin has initiated legal action against Ascendis in the European Unified Patent Court for infringement of a patent covering long-acting CNP variants, with a decision expected in 12-15 months. BridgeBio (BBIO) is also developing a small-molecule drug that addresses the root molecular cause of the condition.

BioMarin's strategy to counter this competition involves leveraging VOXZOGO's extensive safety and efficacy data, including its unique positive impact on spinal morphology, and expanding its label to new indications like hypochondroplasia. Furthermore, BMN 333 is being developed with the explicit goal of demonstrating superior efficacy over VOXZOGO, aiming to set a new standard of care and maintain BioMarin's leadership. Management believes that patients satisfied with their current treatment are less likely to switch, providing a degree of "stickiness" for VOXZOGO.

In its Enzyme Therapies segment, BioMarin faces competition from generic versions of products like KUVAN, which has impacted revenues. However, products like PALYNZIQ, with its unparalleled efficacy in reducing Phe levels and enabling an unrestricted diet, maintain strong competitive positioning. The company's deep global footprint, with approximately 75% of year-to-date VOXZOGO revenue generated outside the U.S., provides a strategic advantage in reaching dispersed rare disease patient populations, a capability that larger, more diversified competitors like Novartis (NVS) or Sanofi (SNY) may not replicate with the same specialized focus.

Outlook and the Path Ahead

BioMarin has updated its full-year 2025 guidance, reflecting confidence in its strategic execution. The company raised the lower end of its total revenues guidance to $3.15 billion, with the midpoint representing double-digit year-over-year growth. The full-year 2025 VOXZOGO revenue outlook was reaffirmed at $900 million to $935 million. However, the full-year 2025 non-GAAP operating margin guidance was updated to between 26% and 27%, and non-GAAP diluted EPS guidance to between $3.50 and $3.60, primarily reflecting the impact of the Inozyme acquisition IPR&D charge.

A significant adjustment was the rescission of the specific $4 billion 2027 revenue outlook. Management cited "many unknowns and variables," particularly the impact of potential VOXZOGO competition, as the reason for this change. BioMarin now outlines a range of estimates, with the lower end aligning with current FactSet consensus (approximately $3.65 billion excluding ROCTAVIAN) and reflecting a scenario with two competitors successfully launching and taking significant share by 2027. The higher end of the range, potentially reaching $4 billion, assumes less competition or successful intellectual property defense.

Despite these competitive dynamics, the company maintains its 2026 non-GAAP operating margin target of 40%, emphasizing its commitment to driving efficiency without compromising value-creating activities. The long-term outlook for the Enzyme Therapies business unit remains a high single-digit sustainable growth rate.

Key Risks and Investment Considerations

Investing in BioMarin involves several key risks. The intensifying competitive landscape for VOXZOGO, particularly from new entrants with potentially differentiated profiles, could impact future market share and revenue. Regulatory hurdles remain significant, with the lengthy and uncertain approval processes for new indications and products, as well as ongoing compliance requirements for existing therapies. The outcome of intellectual property litigation, such as the ongoing case against Ascendis Pharma (ASND), could materially affect BioMarin's competitive position.

Macroeconomic factors, including inflation, foreign currency exchange rate fluctuations, and geopolitical instability, continue to pose risks to global revenue sources and operational costs. Changes in healthcare policies and pricing regulations, both in the U.S. (e.g., the Inflation Reduction Act) and internationally (e.g., EU HTA regulation), could exert downward pressure on product pricing and reimbursement. Furthermore, manufacturing complexities, reliance on single-source suppliers, and the inherent risks of product liability and cybersecurity incidents are ongoing concerns.

Conclusion

BioMarin Pharmaceutical Inc. is at a pivotal juncture, strategically reorienting its business to capitalize on its deep expertise in rare disease innovation. The company's robust financial performance, driven by its Enzyme Therapies and Skeletal Conditions business units, provides a strong foundation for future growth. While the decision to divest ROCTAVIAN and the revised 2027 revenue outlook reflect a pragmatic assessment of an evolving competitive landscape, BioMarin's commitment to its core strengths and pipeline advancement remains unwavering.

The company's technological differentiators, particularly in CNP analogs and enzyme replacement, are critical to its long-term success, promising superior efficacy and addressing significant unmet needs. With a strong balance sheet and a clear focus on strategic business development, BioMarin is poised to unlock further value. Investors should closely monitor the competitive dynamics for VOXZOGO, the progress of its advanced pipeline candidates like BMN 333 and BMN 401, and the company's ability to execute its focused growth strategy amidst broader market uncertainties.