Executive Summary / Key Takeaways

• Regeneron Pharmaceuticals (NASDAQ: REGN) continues to demonstrate robust growth driven by its diverse portfolio, particularly Dupixent and Libtayo, which are offsetting competitive pressures on the EYLEA franchise.
• The company's proprietary VelocImmune technology and significant R&D investments are yielding a prolific pipeline of approximately 45 product candidates, with multiple pivotal readouts and regulatory submissions anticipated across oncology, immunology, rare diseases, and genetic medicines.
• Strategic initiatives, including substantial U.S. manufacturing investments and a focus on enhancing the quality of weight loss in obesity, underscore a long-term vision for sustained innovation and market expansion.
• Despite recent regulatory delays related to third-party manufacturing for EYLEA HD and odronextamab, Regeneron is actively pursuing resolutions and remains confident in its regulatory pathways and product enhancements.
• Regeneron's strong financial health, characterized by substantial cash reserves, low debt, and significant free cash flow generation, supports continued internal investment and shareholder returns through an initiated quarterly dividend and ongoing share repurchase programs.

A Foundation of Scientific Breakthroughs and Strategic Expansion

Regeneron Pharmaceuticals, Inc. is a fully integrated biotechnology company with a rich history rooted in scientific innovation. Established in 1988, the company's co-founders pioneered the concept of genetically humanized mice in 1985, a breakthrough that became the bedrock of its proprietary VelocImmune and VelociSuite technologies. This foundational commitment to science has consistently propelled Regeneron's strategy, leading to the discovery and development of numerous life-transforming medicines across a broad spectrum of serious diseases, including eye conditions, allergic and inflammatory diseases, cancer, and rare genetic disorders.

The company's strategic approach emphasizes maintaining a strong foundation in scientific research and drug development, complemented by robust clinical development, manufacturing, and commercial capabilities. This integrated model has enabled Regeneron to effectively translate scientific insights into commercial successes. By 2024, Regeneron had 13 products approved or authorized globally, with several achieving blockbuster status, a testament to its sustained innovation.

Technological Edge: The VelocImmune Advantage and Beyond

Regeneron's core competitive advantage stems from its proprietary VelocImmune technology, a genetically engineered mouse platform designed to produce optimized, fully human antibodies. This technology has been instrumental in the creation of a substantial proportion of all original, FDA-approved fully human monoclonal antibodies, including key products like Dupixent and Libtayo. The tangible benefit of VelocImmune lies in its ability to streamline the drug discovery process, leading to more efficient development cycles and potentially superior therapeutic profiles. This technological prowess allows Regeneron to develop targeted therapies that often exhibit enhanced efficacy and safety, fostering stronger customer loyalty and recurring revenue streams.

Beyond VelocImmune, Regeneron is actively investing in and integrating new technologies to further accelerate its R&D. The company recently entered a licensing agreement with Telesis Bio (TBIO) to adopt the Gibson SOLA™ Platform for rapid, on-site DNA and gene synthesis. This initiative aims to enable automated, high-throughput, on-demand gene synthesis directly within Regeneron's laboratories, with the stated goal of accelerating biologics development. Furthermore, Regeneron is a leader in high-throughput human DNA sequencing, having built the world's largest DNA sequence-linked healthcare database, encompassing nearly 3 million individuals. This is being expanded through a collaboration with Truveta to include up to an additional 10 million individuals, offering unparalleled insights for genetics-guided drug discovery. The company is also emerging as a leader in high-throughput proteomics, generating data for the UK Biobank Pharma Proteomics project. These advanced genetic and genomic capabilities are foundational to Regeneron's strategy, allowing it to identify innovative targets and develop complementary approaches to treat or cure diseases, thereby strengthening its competitive moat and long-term growth prospects.

Commercial Portfolio: Growth Drivers and Evolving Dynamics

Regeneron's commercial portfolio is anchored by several key products, each contributing to its financial performance and strategic positioning.

Dupixent: A Powerhouse in Type 2 Inflammation

Dupixent (dupilumab Injection), developed in collaboration with Sanofi , remains a significant growth engine. It is a leading biologic medicine for Type 2 inflammatory diseases, approved in the U.S. to treat eight distinct conditions, including atopic dermatitis, asthma, chronic rhinosinusitis with nasal polyposis (CRSwNP), eosinophilic esophagitis (EoE), chronic spontaneous urticaria (CSU), and bullous pemphigoid (BP). By the third quarter of 2025, Dupixent was actively treating over 1.3 million patients globally.

In the nine months ended September 30, 2025, Regeneron's share of profits from Dupixent and Kevzara reached $3,755.7 million, a 30% increase from the same period in 2024. This growth was directly linked to higher Dupixent sales, which totaled $4,857 million globally in Q3 2025 alone, representing a 27% year-over-year increase. Dupixent's recent launches in COPD, CSU, and BP are progressing well, with management noting strong uptake and physician appreciation for its differentiated clinical profile. The drug's approved indications could potentially address over 4 million patients in the U.S. alone, positioning it for sustained growth.

EYLEA Franchise: Adapting to Competitive Headwinds

The EYLEA franchise, comprising EYLEA HD (aflibercept Injection 8 mg) and EYLEA (aflibercept Injection), continues to be a major revenue contributor for Regeneron in the U.S. For the nine months ended September 30, 2025, total U.S. net sales for EYLEA HD and EYLEA were $3,301.5 million. However, this represented a decrease of $1,171.7 million compared to the same period in 2024.

EYLEA HD U.S. net sales showed positive momentum, reaching an all-time high of $431 million in Q3 2025, a 10% increase year-over-year, driven by robust physician unit demand. Conversely, EYLEA U.S. net sales declined by 41% to $680.6 million in Q3 2025, impacted by competitive pressures, patient affordability issues leading to increased use of compounded bevacizumab, and the ongoing transition of patients to EYLEA HD. Regeneron anticipates continued competitive pressure on EYLEA and expects EYLEA HD's sequential demand growth to moderate to high single digits as it awaits label enhancements.

The company is actively pursuing regulatory enhancements for EYLEA HD, including a 4-week dosing interval, approval for macular edema following retinal vein occlusion (RVO), and a prefilled syringe administration. These enhancements are crucial to fully unlock EYLEA HD's commercial potential and are expected to accelerate its uptake. However, regulatory delays have occurred, with a Complete Response Letter (CRL) issued for the EYLEA HD prefilled syringe due to unresolved inspection findings at a third-party manufacturing filler, Catalent Indiana, LLC . Regeneron is working to address these issues, with plans to submit an application for a new prefilled syringe manufacturing filler by January 2026 and an additional vial filler by late December 2025.

Libtayo: Expanding Oncology Footprint

Libtayo (cemiplimab Injection) achieved blockbuster status in 2024 and continues to be a strong growth driver in oncology. Global net product sales for Libtayo reached $365.2 million in Q3 2025, a 24% increase on a constant currency basis year-over-year. U.S. net sales grew 12% to $219.1 million, while Rest of World (ROW) sales increased 47% on a constant currency basis.

Libtayo maintains market leadership in non-melanoma skin cancers and is steadily gaining share in lung cancer, where it is now the second most commonly prescribed immunotherapy for newly diagnosed patients. A significant milestone was achieved in October 2025 with FDA approval for Libtayo in high-risk adjuvant cutaneous squamous cell carcinoma (CSCC), making it the first and only PD-1 antibody indicated for this setting. This indication alone represents an addressable market of up to 10,000 patients in the U.S. The European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) also adopted a positive opinion for Libtayo in this indication, with an EC decision expected in Q4 2025.

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Financial Strength and Capital Allocation

Regeneron demonstrates robust financial health, providing a solid foundation for its ambitious R&D and commercialization efforts. As of September 30, 2025, the company held $2.51 billion in cash and cash equivalents and $16.22 billion in marketable securities, with approximately $16 billion in cash and marketable securities less debt.

The company generated $3.2 billion in free cash flow through the first nine months of 2025. This strong cash generation supports Regeneron's capital allocation strategy, which prioritizes heavy investment in internal R&D, strategic business development, and direct returns to shareholders. Regeneron repurchased approximately $2.8 billion of its shares in the first nine months of 2025, the highest amount ever allocated to open market repurchases in any full fiscal year. The company anticipates returning approximately $4 billion to shareholders through dividends and repurchases in 2025. In late 2024, Regeneron initiated a quarterly cash dividend program of $0.88 per share, reflecting confidence in future cash flows and aiming to broaden its investor base.

Operating expenses reflect the company's investment strategy. Research and Development (R&D) expenses for the nine months ended September 30, 2025, were $4,224.1 million, a 13.5% increase from the prior year, driven by the advancement of its late-stage clinical pipeline. Acquired in-process R&D (IPRD) expenses included an $80 million upfront payment for a dual GLP-1/GIP receptor agonist in-licensing agreement with Hansoh Pharmaceuticals. Selling, General, and Administrative (SG&A) expenses decreased in Q3 2025, primarily due to lower charitable contributions. The non-GAAP gross margin on net product sales for Q3 2025 was 86%.

A Pipeline Poised for Transformation

Regeneron's pipeline comprises approximately 45 product candidates in clinical development, with a focus on high-impact areas.

Oncology and Hematology

In oncology, the combination of fianlimab (LAG-3 antibody) with Libtayo in first-line metastatic melanoma is a key focus, with Phase 3 results expected in the first half of 2026. This combination aims to demonstrate meaningful additive benefit over PD-1 monotherapy without exacerbating safety, building on early compelling efficacy data.

Lynozyfic (linvoseltamab), a BCMAxCD3 bispecific antibody, was approved in the U.S. and EU for relapsed/refractory multiple myeloma in July 2025. Management believes Lynozyfic has best-in-class efficacy in this late-line setting, with nearly double the complete response rates compared to other approved BCMAxCD3 bispecifics. The company is pursuing an aggressive strategy to advance Lynozyfic into earlier lines of myeloma, including high-risk smoldering myeloma where monotherapy has shown a 100% objective response rate in initial cohorts, and a Phase 3 head-to-head study against Darzalex is planned.

Odronextamab (CD20xCD3 bispecific) for relapsed/refractory follicular lymphoma received a CRL from the FDA, also impacted by the Catalent (CTLT) inspection. However, the Phase 3 study evaluating odronextamab as first-line monotherapy in follicular lymphoma is fully enrolled, with a lead-in cohort demonstrating a 100% complete response rate.

Immunology and Rare Diseases

In immunology, Regeneron's C5 program, combining a C5 antibody with a C5 siRNA, shows promise. The once-monthly subcutaneous regimen for Paroxysmal Nocturnal Hemoglobinuria (PNH) may offer best-in-class disease control and convenience. For generalized myasthenia gravis, the C5 siRNA cemdisiran, dosed subcutaneously every three months, achieved statistically significant results for its primary endpoint in Phase 3, with numerically better cross-trial efficacy compared to other C5 inhibitors. A U.S. regulatory application for cemdisiran monotherapy is planned for Q1 2026.

In rare diseases, garetosmab demonstrated unprecedented clinical benefit in the Phase 3 OPTIMA trial for fibrodysplasia ossificans progressiva (FOP), showing a greater than 99% reduction in abnormal bone formation at 56 weeks. A U.S. regulatory submission is planned for year-end 2025. Additionally, the DB-OTO gene therapy for profound genetic hearing loss has shown meaningful hearing gains in 11 out of 12 treated children, with a BLA submission planned for Q4 2025.

Metabolic Diseases and Thrombosis

Regeneron is expanding its presence in the rapidly growing obesity market by in-licensing HS-20094, a dual GLP-1/GIP receptor agonist in Phase 3 development. This strategic move aims to enable combination studies with Regeneron's proprietary drugs to address muscle loss and other comorbidities of obesity. Interim data from the Phase 2 COURAGE study, combining trevogrumab (myostatin antibody) with semaglutide, showed a 50% to 80% reduction in lean mass loss while increasing fat mass loss, addressing a key concern with GLP-1 therapies.

The Factor XI program is advancing rapidly with two distinct antibodies, REGN7508 and REGN9933, designed to tailor anticoagulation therapy. REGN7508 targets the catalytic domain for maximal anticoagulant activity, while REGN9933 targets the A2 domain for a lower bleeding risk profile. Positive Phase 2 data demonstrated robust antithrombotic effects with no clinically relevant bleeding, supporting the initiation of broad Phase 3 programs in 2025.

Competitive Positioning and Industry Trends

Regeneron operates in a highly competitive biopharmaceutical landscape, facing rivals like Amgen , Biogen (BIIB), AbbVie (ABBV), Gilead Sciences (GILD), and Vertex Pharmaceuticals (VRTX). While these competitors have established portfolios and global reach, Regeneron differentiates itself through its R&D agility, proprietary technology platforms, and focus on targeted, first-in-class therapies.

In ophthalmology, the EYLEA franchise competes with Roche (RHHBY)'s Vabysmo and Susvimo, Novartis (NVS)' Beovu, and biosimilar versions of Lucentis and EYLEA, such as Amgen (AMGN)'s Pavblu. The increasing availability of low-cost off-label bevacizumab and biosimilars, coupled with patient affordability issues, has impacted EYLEA's market share. Regeneron's strategy to counter this involves enhancing EYLEA HD's profile with improved dosing flexibility and delivery systems.

Dupixent faces competition from systemic JAK inhibitors and other antibodies in immunology. However, its broad efficacy across multiple Type 2 inflammatory diseases and favorable safety profile continue to drive its market leadership and make it a primary beneficiary of overall market growth. In oncology, Libtayo competes with other PD-1/PDL-1 antibodies, but its success in advanced non-melanoma skin cancers and its recent approval in adjuvant CSCC, where competitors like Merck (MRK)'s Keytruda failed, highlight its differentiated efficacy.

The broader industry faces challenges from drug pricing regulations, including the Inflation Reduction Act (IRA) and potential Most-Favored-Nation (MFN) pricing policies in the U.S. Regeneron is engaging in constructive discussions with the U.S. government to balance drug cost reduction with preserving innovation. The company's significant investments in U.S. manufacturing, including over $7 billion planned for facilities in New York and North Carolina, align with national security and economic priorities, potentially mitigating some regulatory risks.

Outlook and Guidance

Regeneron's outlook for 2025 and beyond is characterized by continued heavy investment in R&D and strategic commercialization efforts. The company anticipates a mid-teens percentage increase in R&D expense in 2026 relative to 2025, reflecting its expanding late-stage pipeline. For 2025, R&D spend is projected to be in the range of $5 billion to $5.2 billion. SG&A expenses are expected to be between $2.55 billion and $2.7 billion, driven by investments in oncology launches.

The Sanofi (SNY) development balance, which impacts collaboration revenue, is expected to be fully reimbursed by no later than the end of Q3 2026, which should significantly boost future collaboration revenue and cash flow. Capital expenditures for 2025 are guided between $850 million and $975 million, supporting R&D facility expansion and manufacturing capacity increases. The effective tax rate for 2025 is projected to be in the range of 11% to 13%.

Conclusion

Regeneron Pharmaceuticals stands as a formidable force in the biotechnology sector, driven by a relentless pursuit of scientific innovation and a strategically diversified pipeline. The company's proprietary VelocImmune technology continues to be a wellspring of novel therapies, underpinning its competitive edge in developing best-in-class treatments across immunology, oncology, and rare diseases. While the EYLEA franchise faces evolving market dynamics and biosimilar competition, the robust growth of Dupixent and the promising trajectory of new oncology assets like Libtayo and Lynozyfic are poised to sustain Regeneron's revenue and profitability.

The company's substantial financial strength, evidenced by strong cash flows and a balanced capital allocation strategy that includes significant R&D investment and shareholder returns, provides resilience against industry headwinds and regulatory complexities. With numerous pivotal data readouts and regulatory milestones anticipated in the near term, Regeneron is strategically positioned to translate its deep scientific capabilities into meaningful commercial opportunities, reinforcing its long-term growth narrative and delivering value to investors.