Insmed's Q3 2025: Contradictions Emerge on Patient Population, Reimbursement, and Pricing Strategies

Date of Call: None provided

Financials Results

• Revenue: Brensupri: $28.0M net sales in partial Q3 launch (~6 weeks); ARIKAYCE 2025 guidance raised to $420M–$430M (from $405M–$425M; +15%–18% vs 2024)
• Gross Margin: Cost of product revenues $29.4M (20.6% of revenues), lower percentage than historical performance—implies gross margin ≈79.4%, reflecting Brensupri contribution

Guidance:

• ARIKAYCE 2025 full‑year net revenue guidance raised to $420–$430M (up from $405–$425M; +15%–18% vs 2024)
• First full quarter of Brensupri launch (Q4) to be reported early 2026 and will give clearer launch trajectory
• EMA decision expected by year‑end; potential EU launch early 2026; UK approval/launch targeted H1 2026; Japan filing accepted, potential H2 2026 launch
• BIRCH top‑line results no later than early January 2026
• CDER (hidradenitis) top‑line readout planned in H1 2026
• TPIP single Phase‑3 PAH trial start expected early 2026; registrational starts in PPF/IPF likely H2 2026
• ENCORE (ARIKAYCE label expansion) readout expected H1 2026
• Cash position ~ $1.7B

Business Commentary:

* Brensupri Launch Success: - Brensupri achieved $28 million in net sales in its first partial quarter of launch, with approximately 2,550 new patients starting treatment and about 1,700 physicians writing scripts. - The strong launch is driven by broad physician engagement, especially in academic centers and community settings, and positive market access with broad patient coverage.

• ARIKAYCE Revenue Growth:
• ARIKAYCE posted its largest quarter of revenue ever, up 22% compared to the same quarter last year, with international business growing over 50%.

• This growth is attributed to the continued strong execution of commercial strategies globally and the broadening demand for the product.

• Pipeline and Clinical Milestones:

• Insmed anticipates numerous clinical and commercial catalysts over the next 18 months, including launches and readouts from various studies.

• The robust pipeline and planned initiatives are driven by the successful development of first and best-in-class therapies and strategic investments in research and development.

• Financial Performance and Cash Position:

• Insmed increased its full-year 2025 global ARIKAYCE net revenue guidance to $420 to $430 million, reflecting strong financial execution.
• The company maintains a strong cash position of approximately $1.7 billion, which supports its continued research and development efforts and commercial expansion.

Sentiment Analysis:

Overall Tone: Positive

• Management: "enormously pleased" with Brensupri launch; Roger: Brensupri achieved $28M, ~2,550 new patients and ~1,700 prescribers in six weeks; Sara: raising ARIKAYCE 2025 guidance to $420–$430M; repeated emphasis on strong pipeline catalysts and market access progress supports a positive tone.

Q&A:

• Question from Jessica Fye (J.P. Morgan): Early field feedback on physician experience with Brensupri and reimbursement process?
  Response: Management: Field feedback is net positive—broad prescribing and patient enthusiasm; reimbursement approvals broadly straightforward so far but may tighten as payers finalize criteria; Q4 will clarify adoption depth.

• Question from Ritu Baral (TD Cowen): What payer coverage thresholds (covered lives, time to fill, prior authorization) are you targeting?
  Response: Management: Goal is 'frictionless' access—clear, simple prior‑authorization mirroring trial entry (≥2 exacerbations), minimizing back‑office burden; engaging payers covering ~90% targeted lives and willing to modestly discount.

• Question from Joseph Swartz (Leerink Partners): How frictionless has the launch been regarding documentation required by payers?
  Response: Management: So far manageable—some payers require CT documentation and exacerbation history but physicians report it isn't overly onerous; IRA accounts for about half of early launch discounting.

• Question from Jason Zymanski (BofA Securities): How has DTC impacted awareness—patient vs prescriber interest?
  Response: Management: Patient awareness and enthusiasm are high (patients sharing on social media); physician awareness is strong, but it's too early to quantify prescription impact.

• Question from Andrea Newkirk (Goldman Sachs): What investments are needed for European commercial preparation and what was Brensupri gross‑to‑net this quarter?
  Response: Management: European investment will be cautious pending reimbursement outcomes; Japan salesforce already expanded; gross‑to‑net not disclosed quarterly but launch analogs ~25%–35% (≈half due to IRA).

• Question from Vamil Devon (Guggenheim Securities): TPIP Phase‑3 design and overcoming orphan exclusivity—how will you design to ensure launch?
  Response: Management: Plan to initiate Phase‑3 program; expect to permit individualized titration and believe orphan exclusivity can be addressed by demonstrating superiority in efficacy, safety, or patient‑care impact.

• Question from Gavin Clark Gartner (Evercore ISI): BIRCH—expectations for control arm TSS reduction, baseline TSS, and eosinophil strata?
  Response: Management: Enrollment requires baseline TSS ≥5 (max 9); trial is on top of stable steroid therapy; both <300 and ≥300 eosinophil patients enrolled and primary analysis will assess the full population.

• Question from Clara Dong (Jefferies): Any seasonality impact on patient flow or CT availability for Q4 and beyond?
  Response: Management: No material CT access issues expected; possible modest holiday slowdown; monitoring 2026 Medicare deductible/copay and reauthorization impacts.

• Question from Ash Verma (UBS): Do you already have BIRCH data in house and timing for top‑line?
  Response: Management: Majority of data are in cleaning with final patients completing; database lock ongoing—top‑line planned for early January.

• Question from Ben Burnett (Wells Fargo): Are physicians prescribing to moderate patients or mainly severe/exacerbators?
  Response: Management: Early prescribing focused on patients with ≥2 exacerbations (moderate‑to‑severe) per trial entry criteria; potential to expand to other populations over time as experience grows.

• Question from Leonid Taimashev (RBC Capital Markets): Which BIRCH subgroups will you examine beyond eosinophils and is this commercially or clinically driven?
  Response: Management: No prespecified subgroups beyond planned stratifications; will follow the data to identify any responsive subpopulations—decision driven by clinical signals, not presumption.

• Question from Olivia Brayer (Cantor Fitzgerald): Why match EU list price to U.S. and what is the prescriber mix (academic vs community)?
  Response: Management: Policy is to match U.S. list price in EU/Japan; net price will depend on local negotiations; early prescribers are broadly split across centers of excellence and community, but most have written only 1–2 scripts so far.

• Question from Stephen Willey (Stifel): Will the Phase‑3 PAH population mirror Phase‑2 and any label expectations?
  Response: Management: Phase‑3 will be consistent with Phase‑2 but allow titration up to 1,280 mcg per patient; final label scope will depend on Phase‑3 outcomes.

• Question from Matthew Phipps (William Blair): Which Brensupri dose are physicians preferring (25 mg vs 10 mg)?
  Response: Management: Majority of prescriptions are 25 mg; some physicians start at 10 mg and up‑titrate—25 mg lung‑function benefit resonates with thought leaders.

• Question from Maxwell Score (Morgan Stanley): How does Brensupri launch performance compare to analogs and expectations for upcoming quarters?
  Response: Management: No formal guidance; analogs suggest high‑double‑digit millions combined across first two full quarters is a benchmark aspiration, but management is cautious and awaits Q4 data to assess trajectory.

• Question from Sam Long for Greg Suvanove (Mizuho): Have payers begun restricting use to patients with fewer than two exacerbations?
  Response: Management: Focus and expected payer criteria mirror clinical trial (≥2 exacerbations); no significant payer restrictions to <2 exacerbations observed.

• Question from Brandon on behalf of Andy Chin (Wolfe Research): Will CDER top‑line include HiSCR data and how might brensocatib fit in HS treatment landscape?
  Response: Management: Top‑line CDER will report 16‑week primary AN count and include HiSCR50/75 as secondary endpoints; 52‑week HiSCR data will inform Phase‑3 planning and could position brensocatib as an oral HS option if positive.

Contradiction Point 1

Patient Population and Awareness

It involves the company's expectations and strategies related to patient awareness and identification, which are critical for marketing and sales forecasts, especially for a new drug like Brensupri.

What factors are impacting Brensupri's patient journey? - Jason Zymanski (BofA Securities)

2025Q3: Enthusiasm among patients is evident from social media. Physicians are also well aware. Practical application of awareness to patient population is the focus, with broader adoption expected in Q4 and 2026. - Will Lewis(CEO)

Are eligible bronchiectasis patients accurately identified and reported in medical records? How is this strategy implemented? - Dingding Shi (Jefferies)

2025Q2: We sizes the market to 250,000 patients with two or more exacerbations, verified through ICD-10 codes and surveys. Additional undiagnosed patients may be uncovered, which could be significant. We expect more patients to be identified as we educate physicians and patients on bronchiectasis symptoms. - William Lewis(CEO)

Contradiction Point 2

Frictionless Launch and Reimbursement Process

It involves the company's expectations and strategies related to the launch process and reimbursement procedures, which are critical for the successful adoption of Brensupri by physicians and patients.

How smooth has the launch been regarding payer documentation requirements? - Joseph Swartz (Leerink Partners)

2025Q3: Will Lewis: So far so good, but may not be the norm going forward. Some documentation required, but considerable flexibility provided. Roger Adsett: No concerns raised by physicians about the documentation process. The aim is to make it easier for physicians and back office staff. - Will Lewis(CEO), Roger Adsett(COO)

What aspects of your approach for patients with CT-diagnosed two exacerbations have received positive payer feedback? Are there additional diagnostic requirements? - Ritu Baral (TD Cowen)

2025Q2: Our objective is a frictionless launch with smooth prior authorization. Physicians need to attest to a bronchiectasis diagnosis with CT and two exacerbations in the last 12 months. This is the appropriate patient population. Payer feedback is supportive of our approach, acknowledging the need for a solution for patients experiencing exacerbations. - Roger Adsett(COO)

Contradiction Point 3

Pricing Strategy and Patient Access

It involves the company's pricing strategy and its impact on patient access to its product, which are crucial factors for market acceptance and revenue generation.

Why keep EU list price equal to the US price? - Olivia Brayer(Cantor Fitzgerald)

2025Q3: We match US price in EU and Japan. Discounts are negotiated with payers, impacting net price. We aim for a list price that represents value for patients. - Will Lewis(CEO), Sara Bonstein(CFO)

How much will potential MFN legislation influence pricing for brensocatib's global launch in the U.S. and globally? - Andrea Newkirk(Goldman Sachs)

2025Q1: The pattern of behavior suggests that sometimes dramatic statements are made, and then there's reflection leading to compromise. We're uniquely positioned because we're setting prices in the U.S. first before other regions. ARIKAYCE was priced at parity between the U.S., Europe, and Japan. Despite potential MFN legislation changes, we have flexibility to respond to the environment. - Will Lewis(CEO)

Contradiction Point 4

Launch Frictionlessness and Patient Awareness

It concerns the ease of the product launch and patient awareness, which directly impacts market penetration and acceptance.

What factors are impacting the patient journey for Brensupri's launch? - Jason Zymanski(BofA Securities)

2025Q3: Enthusiasm among patients is evident from social media. Physicians are also well aware. Practical application of awareness to patient population is the focus, with broader adoption expected in Q4 and 2026. - Will Lewis(CEO)

What are the key levers for transitioning an interested patient to therapy? - Jason Zemansky(Bank of America)

2025Q1: The landscape is favorable with enthusiasm from patients and physicians. The New England Journal of Medicine publication received overwhelming response. About 53,000 self-identified patients have taken action on the website. We anticipate a frictionless launch, which is easy and rapid uptake for appropriate patients. - Will Lewis(CEO)

Contradiction Point 5

Market Access and Reimbursement Strategy

It involves the company's approach to market access and reimbursement for Brensupri, which is crucial for successful market penetration and revenue generation.

What criteria do you use for payer coverage and time to fill coverage? - Ritu Baral (TD Cowen)

2025Q3: We're engaging with 90% of targeted payers preapproval, aiming for clear criteria. No formal targets for formulary addition, but ease for patients and physicians is the goal. - Roger Adsett(COO)

What factors under your control will ensure a successful Brenso launch besides clinical data and sales force? - Joe Schwartz (Leerink Partners)

2024Q4: Our market access strategy is to create a frictionless launch with verbal attestation by physicians for patient eligibility. We are willing to engage in minor contracting to facilitate this. - Will Lewis(CEO)