Incyte's Q3 2025 Earnings Call: Contradictions Emerge on Therapeutic Priorities, PD-1 TGF-β Timelines, and BET Inhibitor Program Decisions

Date of Call: October 28, 2025

Financials Results

• Revenue: $1.37B total revenue; product sales $1.15B, up 20% and 19% YOY, respectively

Guidance:

• Jakafi full-year guidance raised to $3.05B–$3.075B.
• 2025 net product revenue guidance raised to $4.23B–$4.32B.
• Maintained 2025 GAAP OpEx guidance at $3.25B–$3.31B (R&D + SG&A).
• Ruxolitinib XR stability data to FDA by year-end with expected launch mid-2026.
• Plan to file Opzelura for moderate AD in EU by year-end; potential approval H2 2026.
• Povorcitinib submissions: EU by year-end, U.S. early 2026; potential approvals late 2026/early 2027.
• Phase III for TGF‑beta x PD‑1 in first-line MSS CRC planned in 2026; 989 pivotal trials planned in 2026.

Business Commentary:

• Revenue and Product Sales Growth:
• Incyte Corporation reported total revenues of $1.37 billion and product sales of $1.15 billion for Q3 2025, representing a 20% and 19% increase year-over-year, respectively.

• The growth was driven by strong performance across key products like Jakafi, Opzelura, Niktimvo, and the launch of new products.

• Jakafi and Opzelura Performance:

• Jakafi sales reached $791 million, marking a 7% increase year-over-year, with growth across all indications.

• Opzelura saw sales of $188 million, up 35% year-over-year, driven by strong prescription demand and favorable formulary placement.

• Niktimvo Launch Success:

• Niktimvo achieved sales of $46 million, up 27% from the previous quarter, with 90% of BMT centers adopting the product.

• The adoption and positive feedback from BMT centers were key factors contributing to its growth trajectory.

• Pipeline and Product Development:

• Incyte continues to streamline its pipeline, pausing or stopping certain preclinical and early clinical stage programs to focus on high-impact projects.
• Key advancements include potential approvals for povorcitinib in HS and ongoing pivotal data for the TGF-beta x PD-1 bispecific antibody in solid tumors.

Sentiment Analysis:

Overall Tone: Positive

• Management described a "strong quarter" with $1.37B total revenue and $1.15B product sales (up 20% and 19% YOY), raised Jakafi and net product guidance, highlighted exceptional Opzelura and a strong Niktimvo launch, and presented encouraging povorcitinib, KRAS G12D and TGF‑beta x PD‑1 data supporting near‑term catalysts and multiple 2026 program starts.

Q&A:

• Question from Tazeen Ahmad (BofA Securities): How important is the 989 monotherapy data at ASH to convince on single‑agent efficacy versus the view it may need synergy with Jakafi; what benchmark would be convincing?
  Response: Management: Single‑agent activity is essential; the ASH update (~50 patients with substantial follow‑up) will show clinical (SVR25/35, TSS50, anemia) and translational endpoints to demonstrate disease modification, with momelotinib (SVR35 7–22%, TSS50 ~25–26%) cited as a reference benchmark.

• Question from Andrew Berens (Leerink Partners): Why terminate povorcitinib in CSU after a successful Phase II and will the data be presented; and will combination data for the TGF‑beta x PD‑1 program be available before advancing to Phase III?
  Response: Management: Povo in CSU was deprioritized based on return profile, differentiation, timing and regulatory bar; the Phase II data will likely be presented at a future conference; for TGF‑beta x PD‑1 they are advancing the Phase III now while combination data are being generated in parallel and will be released next year.

• Question from Stephen Willey (Stifel): What should we expect from the 989 abstract vs the later presentation; and does Sanofi's Rezurock frontline failure inform read‑through to Niktimvo's Phase III?
  Response: Management: Wait for the larger year‑end 989 data cut with more patients/longer follow‑up; regarding Rezurock, endpoint definitions and event criteria matter—Incyte believes its definitions are robust and having two combination trials for Niktimvo (with Jakafi and with steroids) gives multiple paths to success.

• Question from Jay Olson (Oppenheimer): Why terminate the BET inhibitor program and how soon can mCALR (989) enter registrational studies?
  Response: Management: BET was stopped due to a challenging class risk/benefit and priority for higher‑return programs; 989 pivotal trials are targeted to start in 2026 (ET likely H1 2026; MF planned for later in 2026).

• Question from James Shin (Deutsche Bank): Should we expect 989's SVR, TSS and anemia kinetics to resemble ruxolitinib, and what's the progress toward a frontline MF development path and timing relative to Jakafi LOE?
  Response: Management: 989 will be evaluated on standard MF clinical endpoints (SVR25/35, TSS50, anemia) which are critical; pivotal planning aims to start studies in 2026 with potential readouts toward 2029–2030 to establish a frontline pathway and long‑duration revenue stream.

• Question from Salveen Richter (Goldman Sachs): What VAF reduction do you seek and how well does VAF correlate with clinical outcomes; and how are you thinking about OpEx and target margin profile through Jakafi LOE?
  Response: Management: They will report three molecular endpoints (whole‑blood VAF, CD34+ mutant CALR in PBMCs, mutant CALR megakaryocytes in marrow) to show disease modification, but approvals will likely rely on clinical endpoints; on OpEx they will prioritize funding for high‑value programs, expect lower spending growth and margin improvement via sales leverage rather than fixed percentage targets.

• Question from Peter Lawson (Barclays): How sustainable is Niktimvo's growth trajectory and what is its profitability profile?
  Response: Management: Launch is strong with ~90% BMT center adoption, repeat orders, ~800 patients YTD toward a 1,000‑patient year‑end goal, annualizing near $200M and offering a high contribution margin given its targeted specialty account base.

• Question from Evan Seigerman (BMO Capital Markets): How must the pipeline mature to replace Jakafi revenue through LOE and what BD would be necessary; what does Incyte look like with/without mCALR by decade end?
  Response: Management: They focus on seven priority drivers (povorcitinib, 989, 617F, three solid‑tumor programs including TGF‑beta x PD‑1 and KRAS G12D, plus Niktimvo); they need 2–3 successful assets (and BD where needed) to replace Jakafi and build a larger, durable business into the next decade.

• Question from Derek Archila (Wells Fargo): Will 989 pivotal trials use IV or the enFuse on‑body pump; and how will you position XR with payers and expected IR→XR share conversion?
  Response: Management: ET pivotal is likely to start before enFuse rollout while MF aims to deploy enFuse for subcu as soon as available; XR expected to launch mid‑2026 with a 15–30% IR→XR conversion by 2028, focusing on rapid formulary access and payer engagement.

• Question from Ashwani Verma (UBS): Can you pursue first‑line/naive patients in registrational studies for 989, and will the subcu form factor enable home self‑administration (device volume)?
  Response: Management: They intend to develop 989 in first‑line MF (ongoing treatment‑naive combo with ruxolitinib) and the Enable collaboration targets a home, self‑administered subcu device with plans to realize this in 2026.

• Question from Reni Benjamin (Citizens JMP): Will you seek to combine XR with pipeline assets to blunt LOE and for the TGF‑beta registrational study what size/delta will you require?
  Response: Management: No current plans to develop XR in combination with pipeline assets—focus is pure launch; the TGF‑beta Phase III will use FOLFOX+bevacizumab in first‑line MSS CRC with PFS primary and will be a large study likely >500 patients, powered to show a meaningful PFS advantage.

• Question from Jessica Fye (JPMorgan): What post‑Jakafi and add‑on evidence would give confidence to move 989 to frontline without a control arm, and how do you use SVR25 vs SVR35 in decisions?
  Response: Management: Confidence derives from safety, clear monotherapy efficacy on SVR35/TSS50/anemia plus translational signals; meaningful improvements in the difficult suboptimal‑responder add‑on cohort are impactful; SVR35 is the key regulatory endpoint (SVR25 reported for directional context).

• Question from Srikripa Devarakonda (Truist): Is it rational to develop both rux‑suboptimal and rux‑naive 989 programs long term or focus on one, and what is FDA guidance on endpoints—co‑primaries and hit requirements?
  Response: Management: They intend to develop 989 for both naive and ruxolitinib‑experienced patients (monotherapy and add‑on); regulatory discussions with FDA are ongoing but clinical endpoints (SVR35, TSS50, anemia) will drive pivotal design, with potential for co‑primary considerations to be finalized with regulators.

Contradiction Point 1

Priority of Therapeutic Areas

It highlights a shift in emphasis on therapeutic areas, which could influence resource allocation and strategic focus.

How will Incyte's target margin change in the coming years, and how will you manage OpEx? - Salveen Richter (Goldman Sachs Group)

2025Q3: MPNs is the most important therapeutic area, with a window of opportunity to transform the treatment of blood cancers. - [William Meury](CEO)

How will you balance pipeline advancement with external opportunities, and what is your 5-year outlook for Incyte? - Jessica Macomber Fye (JPMorgan Chase)

2025Q2: We'll be disciplined about capital allocation, focusing on internal investments first. Our goal is to create a long-term growth foundation, prioritizing strategic business decisions, R&D productivity, cost base, and BD opportunities. - [William Meury](CEO)

Contradiction Point 2

PD-1 TGF-β Program Timeline

It involves differing statements on the timeline for advancing the PD-1 TGF-β program, which may impact expectations and strategic planning.

Can you explain the decision to terminate the povo program for CSU after announcing its success in April? Will data be presented at a medical meeting? - Andrew Berens (Leerink Partners)

2025Q3: Yes, we'll release combination data next year, but we're moving forward with the Phase III study due to the urgency of executing the trial. The goal is to initiate the Phase III study in first-line MSS CRC in 2026. - [Pablo Cagnoni](President and Head of Research & Development)

Can you provide more details on the proof-of-concept data for G12D and the key success metrics? - Yuxi Dong (Jefferies LLC)

2025Q2: We are committed to first-line MSS CRC, and we're going to see what the combination data looks like in 2024. So, if the combination data looks good, we'll jump into that frontline space. - [William Meury](CEO)

Contradiction Point 3

BET Inhibitor Program Rationale

It highlights a shift in the company's strategic focus and prioritization of drug development programs, which can impact investor expectations and resource allocation.

Will combination data be available before advancing the PD-1 TGF-beta program to Phase III? - Andrew Berens (Leerink Partners)

2025Q3: The decision to stop the BET inhibitor program was due to risk-benefit calculus, prioritizing projects with better returns and clarity. - [William Meury](CEO)

What are the implications of the CALR data on curative efficacy and potential mono vs combo with Jakafi? - Salveen Richter (Goldman Sachs)

2025Q1: We are working towards advancing our BET inhibitor program for chronic graft versus host disease through potential proof-of-concept studies. - [Pablo Cagnoni](Head of R&D)

Contradiction Point 4

CSU Povo Program Status and Future Data Release

It involves the status of a specific drug program and the company's commitment to sharing data, which can impact investor understanding of the company's pipeline and transparency.

Why was the povo program for CSU terminated after its April success announcement? Will the data be presented at a medical meeting? - Andrew Berens (Leerink Partners)

2025Q3: The decision was based on prioritizing projects with better returns and market potential. Mohamed added that the regulatory bar for CSU was high, and we decided to focus on other priorities. - [William Meury](CEO), [Pablo Cagnoni](Head of R&D)

How does Povo fit into the treatment landscape for chronic spontaneous urticaria, and will it compete with biologics such as XOLAIR? - David Lebowitz (Citi)

2025Q1: Povo will offer an oral option for patients who prefer it over biologics. Over half of patients fail conventional antihistamines, and Povo may be an option before biologics. - [Herve Hoppenot](CEO)

Contradiction Point 5

Termination of BET Inhibitor Program and Prioritization of Projects

It reflects a change in the company's strategic priorities and the fate of a specific research program, which could impact investor expectations and future research directions.

Will we have combination data prior to advancing the PD-1 TGF-beta program into Phase III? - Andrew Berens (Leerink Partners)

2025Q3: The decision to stop the BET inhibitor program was due to risk-benefit calculus, prioritizing projects with better returns and clarity. - [William Meury](CEO)

What is the role of the BET inhibitor in a post-Jakafi setting? What are the latest plans for frontline development? - Brian Abrahams (RBC Capital Markets)

2024Q4: The BET inhibitor is being advanced for second-line treatment in MF. Plans for a first-line study await more data on safety and endpoint combination with Jakafi. - [Pablo Cagnoni](EVP)