United Therapeutics Corp 2026 Q2 Earnings Call

Thank you, JL. Good morning, everyone. It is my pleasure to welcome you to the United Therapeutics Corporation Second Quarter 2026 Corporate Update webcast. Remarks today will include forward-looking statements representing our expectations or beliefs regarding future events. These statements involve risks and uncertainties that may cause actual results to differ materially. Our latest SEC filings, including Forms 10-K and 10-Q, contain additional information on these risks and uncertainties. We assume no obligation to update forward-looking statements. Today's remarks may discuss the progress and results of clinical trials or other developments with respect to our products. These remarks are intended solely to educate investors and are not intended to serve as the basis for medical decision-making or to suggest that any products are safe and effective for any unapproved or investigational uses. Full prescribing information for the products is available on our website.

Accompanying me on today's call are Dr. Martine Rothblatt, our Chairperson and Chief Executive Officer, Michael Benkowitz, our President and Chief Operating Officer, James Edgemond, our Chief Financial Officer and Treasurer, Dr. Leigh Peterson, our Executive Vice President of Product Development and Xenotransplantation, and Patrick Poisson, our Executive Vice President of Strategic Development. Note that Martine Rothblatt, James Edgemond, and I will participate in a fireside chat and one-on-one meetings at the Wells Fargo Healthcare Conference, September 8th in Boston, the Cantor Fitzgerald Global Healthcare Conference in New York on September 9th. Patrick Poisson will join us for the Morgan Stanley Global Healthcare Conference in New York on September 14th. Lastly, the Bernstein Third Annual Healthcare Forum in New York on September 23rd.

Our scientific, commercial, and medical affairs teams will be present at the European Respiratory Society Congress in Barcelona, September 5th through the 9th, and the American College of Chest Physicians CHEST 2026 annual meeting in Phoenix, October 18 through 21. I will turn the webcast over to Martine for an overview of our development pipeline and business activities.

Martine. We have slides available for reference.

I encourage you to review those at your leisure. I'm not going to speak directly to the slides. The first half of 2026 has been one of the most consequential periods in United Therapeutics' history. First, we delivered exceptional clinical results from our ADVANCE OUTCOMES study, demonstrating ralinepag's potential to become a major new oral therapy for patients with PAH. We unblinded TETON-1, which surpassed the impressive TETON-2 results we reported last September. These results put us in an extraordinary position. A new molecule advancing toward the PAH market and a potential new indication for Nebulized Tyvaso in IPF, representing an opportunity meaningfully larger than our currently approved markets and a new option for patients.

With these highly statistically significant clinical results, we recently submitted to the FDA what we believe are two of the most important new drug applications in rare pulmonary disease, the sNDA for Nebulized Tyvaso in IPF and the NDA for ralinepag in PAH. We are not stopping there. With additional filings planned later this year, including an IND for ralinepag DPI and an NDA for treprostinil SMI. We are moving with urgency toward what we believe will be a pivotal change in our growth trajectory as we plan to bring pioneering advanced inhalation technologies to patients. We expect potential approvals in 2027 for Nebulized Tyvaso in IPF, ralinepag in PAH, and the SMI device in PAH and PH-ILD. These are not incremental opportunities.

We believe they are multibillion-dollar catalysts with the potential to redefine patient treatment paradigms, improve outcomes for patients, and fundamentally transform our growth profile and competitive position. Looking further ahead, enrollment in our TETON PPF trial is nearly complete, paving the way for another substantial phase III readout in the back half of 2027. Based on the successful TETON-1 and TETON-2 studies, as well as the similarities in underlying fibrosis and disease progression between IPF and PPF, we have a high degree of confidence in our ability to report another positive outcome. If successful, TETON PPF would open the door to an even larger opportunity, at least double that of IPF, and position Nebulized Tyvaso to become a leading therapy for patients with pulmonary fibrosis. Turning to our organ pipeline, we continue to make strong progress toward our goal of expanding the availability of transplantable organs.

The UKidney EXPAND study continues to make great progress, with completion of the initial six-patient cohort expected later this year. In parallel, we soon anticipate initiating the UThymoKidney EXTEND Registration Enabling Study. Lastly, with recent clearance from the FDA, we are working to commence our EXPRESS-UHeart study. Moreover, by the end of this year, we will complete construction of our two additional commercial-scale DPFs in Minnesota and Texas. With three authorized clinical trials, United Therapeutics is not just participating in the future of xenotransplantation, we are leading it. We believe this work can redefine organ transplantation, save countless lives, and create one of the most significant growth opportunities in our company's history. Our deep organ pipeline represents a bold and differentiated extension of United Therapeutics' mission, with the potential to transform how patients access life-saving organs and how United Therapeutics will create substantial value over the long term.

We will be sharing with you more details about these programs as each moves through their development timelines. Our ability to pursue these opportunities is supported by a disciplined approach to capital allocation through our budget algorithm, which has positioned us near the top of our industry in operating efficiency. We have also been thoughtful in deploying capital toward internal growth objectives while remaining mindful of returning capital to shareholders. As an example, we recently deployed capital to acquire Thymmune Therapeutics, adding a promising thymus-based regenerative medicine platform that fits squarely within our mission. This acquisition broadens our organ alternative strategy and strengthens our ability to pursue therapies that could restore immune function for patients with serious diseases. We see tremendous potential ahead, and we're excited to welcome the Thymmune team to United Therapeutics.

To close, we believe United Therapeutics is entering a defining era, one shaped by scientific ambition, innovative platforms, and a pipeline with the potential to transform care across some of the most challenging areas of medicine. As these opportunities advance, we see a future in which our impact on patients, our industry, and our growth trajectory can reach an entirely new level, making United Therapeutics a growth story unlike any other in biotech. With that, I'll turn the call over to our President, Michael Benkowitz, who will provide an overview of our commercial performance for the quarter.

Mike? Thank you, Martine. Good morning, everyone.

For the second quarter of 2026, we generated approximately $783 million in total revenue, essentially flat with the first quarter. While these results were below our expectations, they do not change our confidence in the strength of our business, the opportunities in front of us, or our ability to create substantial value over the coming years. I want to start by acknowledging something directly. Over the last several quarters, we understand investors have been looking for a faster acceleration in growth, and we recognize that confidence is earned through execution, not projections. Our focus is on improving results. As we evaluate the current state of the business, we believe the underlying fundamentals are strong, and we believe we are positioned to deliver improved performance in the second half of the year.

Simply put, we exited the second quarter with considerably more momentum than the reported revenue line alone would suggest. Based on the trends we're seeing today, we expect the second half of 2026 to be stronger than the first half of 2026, and we remain focused on accelerating revenue growth as we move through the balance of the year. That said, we are not reaffirming or updating any prior revenue growth expectations for 2026 today. Turning to Tyvaso, total revenue for the quarter was $453 million. Nebulized Tyvaso remained pressured by competitive dynamics within the inhaled prostacyclin category as patients and providers evaluate an increasing number of treatment options. We expected this market to become more competitive over time, and that's precisely what we are seeing today. Tyvaso DPI, meanwhile, continued to demonstrate growth and, more importantly, exited the quarter with what we view as significant underlying momentum.