Following session is not open to the press. Disclosure. Moving. Okay. Good afternoon, everyone. I'm Paul Choi, and I cover the biotechnology sector here at the firm at Goldman Sachs. It's my pleasure to welcome Lantheus. Joining me on stage to my immediate left is Brian Markison, CEO, and Bob Marshall to my far left. What I'll do is turn it over to Brian maybe for some introductory or overview comments, and then we'll get into Q&A after that. I think a lot of people are familiar with Lantheus. We've been in the nuclear medicine business for many years, actually since 1956. Lately, we've become quite well known for our blockbuster agent, PYLARIFY, a PSMA imaging agent for prostate cancer. I think if you look more broadly at the company, we're participating in some of the biggest growth markets. We're in cancer. We're in neuro with Alzheimer's dementia, a particular focus, and also therapeutic oncology, diagnostic oncology, and cardiology to some extent. We're in big markets highlighted by our molecular imaging expertise and also, as of late, therapeutic oncology with a fairly broad collection of assets. Okay. Great. Thanks for that. Maybe we'll start with the commercial side and PYLARIFY. And maybe at a high level, Brian, you guys can characterize what's happening in the PSMA PET imaging market, what are some of the impacts or recent reimbursement changes and so forth that have been happening, as well as some of the color in terms of the competitive dynamics. Yeah, sure. I think overall, you have an extremely healthy market. You've got a PSMA imaging market that's growing somewhere between in the range of 15%-20%. I think what you're seeing as of late with new entrants, Illuccix with a Gallium generator and kit, and then Posluma with a different F-18 construct, you're seeing more competitive dynamics shake out, if you will, in the marketplace. I think the reimbursement environment has been a little bit lumpy, if you will, where we lost our pass-through status at the end of last year and went to MUC pricing for the traditional Medicare outpatient population right after that. We're living through that at the moment. There's also a lot of speculation with CMS. What are they going to do? What are they going to publish in July? Are they going to go to ASP right away? Are they going to go at the end of the year? I think right now, through various conversations, there's a lot of positive momentum, but no one can really sort of play the odds one way or the other on how that's going to break because there's a few other things going on with our government these days that can be quite distracting. I am not quite sure where that's going to go. I think if you boil it all down to the impact on Lantheus and PYLARIFY, we're seeing the volume growth. We're being very careful because we're in our second quarter, so I do not want to comment on the quarter itself. I think this year is going to be a bit lumpy till things settle down. I think there's been a fair amount of testing the waters, if you will, with Posluma because they have a pricing advantage. They didn't lose pass-through. However, with that agent, and it's in their label, there's a fair degree of false positive scans and a warning and a precaution about that. I think that's playing out in the marketplace. I think people that are or physicians that are trying it are seeing it. Excuse me. I think that's kind of interesting. I think with all the different things happening in the marketplace, this year will be lumpy, and then we'll sort of settle down a bit. I think we're already seeing signs that the market's beginning to settle a bit. Bob, would you add anything to that? I think that that's pretty spot on. Okay. Great. As you think about the outlook for maybe PYLARIFY pricing, as you mentioned, some of your competitors have pass-through pricing, yours expired at the end of last year. Maybe you've characterized the rest of this year potentially as lumpy, but maybe a little bit on the forward when your competitors do not have pass-through pricing. Depending on what happens potentially with ASP and pricing, how would you sort of characterize the outlook maybe starting in 2026 and beyond? What should be more of a level playing field for all the competitors? Yeah, I think wherever the share settles out, I think we're going to return market-level growth. We're over-indexed in high decile accounts because that's where the majority of our volume is. I think we've mentioned before that the smaller accounts, which were not our major focus, there's a fair amount of growth there. That growth is really driven by the fact that there's a bit of a bottleneck in the very large institutions. That bottleneck creates an opportunity for folks to go more out to drive further, forget their scans. That's where you'll see the growth. It's accounts that were previously doing one or two scans a week with us. Now maybe they're doing like one a day. It's a very different landscape. Okay. One One thing I would add to that, though, is that it also incentivizes the market to think through expanding hours in the day. Cameras are available 24/7. A rate-limiting factor could be just literally staffing. At the same time, we are seeing extended hours during the workday and even now breaching into the weekend on Saturdays and so forth. That is not everywhere. That certainly is something that the market, and the other part of this as well is the investment that can exist from expanding camera capacities and so forth throughout the country, is certainly something that the market will recognize with PET imaging is going to be an opportunity for investment. Great. You actually bring up a very interesting point, which is that centers are not necessarily running at 24/7 capacity, but there are also some centers that have more or less full use of the boxes or suites available for that particular center. As you think about sort of market dynamics and drivers over maybe a multi-year or longer-term timeframe for PSMA PET, would you emphasize sort of one factor or another in terms of what's going to drive growth over the market? Do we just need more boxes and imaging suites, share gains versus other modalities, pricing, and just how do you think about the longer-term market growth drivers? There is going to be more cameras because they are on order now. And all the GEC means they can basically tell you what the pipeline looks like for their business. That is pretty clear. I think hospitals and the imaging centers, freestanding imaging centers that are largely financially driven, they have already made adjustments. They are open Saturdays all day. I think the hospitals, look, I was at a major teaching institution the other day and at 5:00 P.M., I was walking in the door and almost got ran over with everybody leaving to get home. They are a little slower to adjust and have staff work later hours or even open on a Saturday. It is a little more difficult. They are going to adjust and then they will get the schedule straightened out. Of course, they are all trying to put in new cameras. All of them have new cameras on order. Great. In terms of other drivers such as share gains and adoption of PET, let's say, versus some of the older modalities like CT or other technologies. We're seeing almost a one-for-one drop in bone scans with the increase of PSMA scans. I think CT will become a little less relevant. MRI for prostate's here to stay. I think when you're diagnosing prostate cancer, any urologist would tell you you have to have an MRI of the prostate. I think that's here to stay. I think as you move out in time, I think PSMA scans and other targeted scans are going to become very important. I want to maybe briefly touch on other drivers of market behavior potentially over the near to intermediate term as well, which is the penetration of therapies into earlier line settings, including recent label changes for Novartis's asset. How much of that is a factor in the near term versus longer term in your view? In the very near term, not that much because it takes time. There is an incidence and a prevalence, and these patients are not falling out of trees. I think it is going to take time for adoption. I think, again, the early adopters are the major cancer centers, and from there, it is going to trickle out to the community. A lot of these patients are really treated in the community. It is a trickle-down effect. However, the data supporting radioligand therapy after one hormone therapy in the Novartis trials is really quite strong, not only for efficacy, but quality of life. The ability to get hormone therapy and then upon failure switch to Pluvicto is a compelling case versus another hormone therapy trial or anything else. I think as you look out between now and the end of the decade, PYLARIFY scans as a complement to RLT are going to be the major growth driver. That and also on initial diagnosis because I think people are now getting more comfortable with the fact that PSMA is way more sensitive than PSA. As you're looking at very early-stage prostate cancer with low PSA, you're going to want a PSMA scan anyway. To build on what Brian was saying, because he's absolutely right in the sense that moving into early stages, RLT scanning ahead of to prove avidity, single largest driver, if not the driver of how we used to describe the TAM from going from $2 billion-$3.5 billion market opportunity by the end of the decade. That is the numbers of scans that we would see eligible. Right now, it makes up sort of mid-single-digit type of market at the moment, but then expanding significantly from here. Yeah. Maybe on the subject of the TAM, the TAM I think you have described as largely U.S.-based where your revenues are overwhelmingly U.S.-based. That could change a little bit with some of the deals you've done recently. I just wanted to ask how you think about the international opportunity for PSMA PET. There are some European and Japanese approvals happening near term or fairly soon. I am just curious thinking about the potential revenue mix and expanding your geographic footprint down the road. Yeah. In some ways, Europe is a more mature market, but the competitive dynamic is already there. The pricing dynamic is much less favorable in the U.S. We are partnered with Curium. They are selling PYLARIFY in Europe, and they are doing a very good job. They are ramping country by country. We have plans for Japan, and we also are in discussions around China as well. We do see PYLARIFY as a global brand for global growth, but the main market is the U.S. Japan, by sheer population numbers, will never be as big as the U.S. China is something that is a little bit longer down the road, but could be a tremendous market opportunity. In terms of those other markets, you talked about your partner in Europe. How do you maybe think about going direct versus partnering with a local company? After we close on Life Molecular Imaging, we'll have much more of a European infrastructure. It will be easier for us to decide on whether we go to market ourself or go with a partner. I think we're always going to evaluate that decision. As our pipeline matures, I think certainly for Neuraseek, we would probably want to scale that ourself in Europe. I think with our AD portfolio in general, we'll probably think about doing that ourself in Europe. We'll cross that bridge when we get to the approvals. Sure. As we think about some of the points you mentioned earlier, just government and policy changes here, one of the questions that frequently comes up is just thinking about what's happening with regard to Medicare payments, pass-through, and other dynamics like that. Can you maybe just remind us what is your government versus commercial exposure currently, your rough mix for PYLARIFY? As you mentioned earlier, if the government does go to an ASP-type pricing model, perhaps as early as July, maybe later this year, how does that affect your franchise? Whenever we get to ASP, it's basically a leveling effect. I think you have more even footing for the best molecule to win. That would be us. As far as our government exposure in general, right now we're living it. That's the change from ASP to MUC reimbursement. That's roughly 20% of our patient population on average in any account. The rest is fee-for-service and Medicare Advantage. Right now, our strategic contracts are in place to basically keep the account whole on that segment of the population that has that change of reimbursement. Bob, you wanted to jump in here? No, we're just going to because you talk about government reimbursement more broadly in the sense that there are other elements in terms of the VA or 340B, which is not what we're talking about in this particular sense in terms of MUC. It's a different pricing dynamic. Still, it's the intersection of Medicare fee for service and hospital outpatient fee for service is the 20%. Okay. Great. In terms of the level playing field that you described that could come with ASP, I guess, would that potentially change or maybe alter your commercial strategy now that pricing becomes theoretically less of an issue versus the competition? Do you think about going into more of those smaller accounts where you said you are not necessarily as present and just sort of thinking about addressing those greenfield opportunities? We're going there now. We're redirecting the team a little bit because if there's a waitlist at a major teaching center, our prostate cancer referral team, what do you want them to do? Build up the waiting list to another week to it? It's not going to help us in the short term. I do think we want to drive adoption out into the community. We're heading into the fifth year since product launch. That's quite a bit of time, actually, when you think about it. We always reevaluate the commercial strategy on an ongoing basis. I think we're also harmonizing that with our clinical strategy. I think we're going to do a number of things in the clinic that will demonstrate PYLARIFY as a superior asset. Okay. Great. I want to turn to Evergreen, which you guys recently closed on. Maybe can you just remind us what sort of, first of all, manufacturing and product capacity you inherited with this acquisition? One of the questions in terms of realizing cost and other synergies that we always focus on is analysis. How quickly can some synergies start to be generated here to integrate? Yeah. I think the synergies are going to happen rather quickly because we're already working with now, keep in mind, we closed on Evergreen. So that's check one. Number one synergy is launching Octavi, which is a diagnostic agent for neuroendocrine tumors. Octavi will be probably, we're looking at mid-year next year approval and launch. That's number one synergy, if you will, revenue synergy. I think the other synergies that are going to come is when our radioligand therapy pipeline begins to take shape, we're going to want to put our own assets in our own plant. It's very difficult to use contractors for the whole value chain. That's very exciting. The other thing is we're probably going to pop a cyclotron into that facility as well to really take a look at other venues for the F18 franchise or Copper 6, whatever it is that you want to spin off a cyclotron. There is a lot of R&D synergy, early development synergy, manufacturing synergy to come. Right now, what we acquired was a highly skilled team manufacturing everything from actinium to, unfortunately, iodine because no one loves to manufacture iodine. We can make our own lutetium if we need to. We are basically at scale running a CDMO business with multiple customers, multiple skill sets. Over time, we're going to commit to a few strategic customers because we want the plant utilized. We are going to begin to feather in our own assets. Right now, we're looking to get RM2 in there, LRC15 in there. CCK2R is being manufactured there. That's an Evergreen asset. We're in the clinic right now in phase I in small cell lung cancer in Europe. We opened up that trial for recruitment, I think, last week. We covered all the regulatory barriers. Hopefully, you'll be hearing from us soon that we have a couple of responses in small cell, which will be really cool. Maybe one other question on Evergreen is, as you think about the portfolio that you've acquired here, is there anything particular on the diagnostic side or the therapeutic side that is sort of potentially your favorite new toy here, or that stands out as sort of your favorite shining thing that you're most enthusiastic about? I think the standout is really Tom Reiner, who runs the development group there, and some of the key talent underneath him, like Thomas Lindner. He actually discovered and developed the first FAP compound that went to Sofie and now is with GE. There is a really small but very talented team that is working on developing a number of RLTs that we plan to move through the pipe. They have a very interesting little vivarium so they could do their own animal studies. I think what we are looking at is when you combine that with what Life Molecular Imaging can do in their core labs in Berlin, we will have one of the best development chains on the planet for radioligand therapy, whether it is imaging or therapeutics, it will not matter. Because right now, Life Molecular Imaging is in two major phase three programs and also an early phase one, phase two in imaging. They've been in the imaging business for a very long time, just like Lantheus. When we pool our skill sets, I think what we're looking to do is develop new leads at Evergreen developmental stage assets and then move them into the full pipe that we have, get them developed and either win fast or fail fast. We're looking for novel targets that are only suited for radioligand therapy. Right. It sounds like you're happy about the human capital you acquired with the fields. I think people make it work. Right? Assets come and go, but people are priceless. Great. I want to just briefly touch on your internal radio RLT pipeline, which has a little bit of litigation going on. Can you maybe just remind us sort of what are the next milestones and/or timing roughly that we should expect on that front? The one with litigation is our radio equivalent to Lutathera, which we call 0.2003. It is basically an ANDA that's been filed against Lutathera. I really won't comment on our legal case, but we're hoping and planning that the 30-month stay is up at the middle of next year. We know that we're working with a judge that would like to harmonize the timing of all of the patent litigation to sync up with the 30-month stay expiration. We kind of like where we are. We know we have a formidable opponent across from us in litigation, but we like our case. Okay. Great. Maybe turning to the rest of the internal pipeline and just thinking about, is there a clinical program or aspect of the company that you feel like is just sort of underfollowed either by the sell side or the buy side community that you think is just maybe potentially either a bigger intermediate or longer-term driver? I think the whole pipeline is undervalued by everybody. Because really, it's only been over the last year that we've been able to assemble it and advance it in a way that can really where you could see value. Let's start with the Alzheimer's dementia portfolio that we have. We're filing MK-6240 in the third quarter. Behind it, we have NAV, which is a second-generation beta-amyloid. Also running neck and neck with NAV is another tau agent at Life Molecular Imaging called 2620. That tau agent is very interesting because it expresses or it highlights the other tau pathologies other than AD, other than dementia. That's very interesting. When you look at MK, you look at Neuraseek, which is a phenomenal asset. I think by virtue of our PMF network and our reach and scale with PYLARIFY, we can easily help Neuraseek achieve significant market potential. We acquire Life Molecular Imaging hopefully in the very near future. We close. It comes with a fantastic commercial team, a medical team, and expertise. The cost avoidance for Lantheus is tremendous. That neuro portfolio team, assets, people in one bundle, we view that as a real meaningful short-term growth driver. You have next year the combination of Octavi and 2003, again, two pipeline assets launching next year potentially that look very exciting and could be meaningful growth contributors and a very efficient sale for us. From Octavi's perspective, we're already calling on nuclear medicine physicians. It's not a big reach to get them to look at Octavi and try it. For 2003, that's a nuclear medicine call point for the most part and PET committee. We're not going to be running around talking to referring oncologists and talking to them about a generic Lutathera. Just not in the cards. I think if you look at the lineup of radioligand therapies that we have going into the clinic or in the clinic, we're looking at small cell, extremely high unmet need with CCK2R. By the end of the year, this calendar year, we'll have something to say about what we're seeing in patients real time. LRRC15, we plan to be in the clinic at the end of this year in osteosarcoma. We will know rather rapidly if we've got something really that has. RM2 diagnostic and therapeutic targeting GRPR is also a very exciting combination. We're focusing on prostate cancer. Novartis has a similar program. They're in breast cancer. I believe Lilly is launching their program with a similar asset. We have a very interesting molecule with great dynamics, pharmacokinetics. We're interested to see where it goes in GRPR expression in prostate cancer is quite interesting. It overexpresses in early prostate and hormone-sensitive disease. There is a definitive role that can be carved out for GRPR and PSMA. I think finding where those two can coexist and complement each other because when one overexpresses, the other one tends to downregulate. I think that's a very exciting journey. We're just at the very beginning of it. Our diagnostic works. We know it. We've got evidence in the clinic. It's in phase two. I think we're looking at a fast track approval there that we haven't really finished off the complete strategy. As far as the therapeutic is concerned, we plan to be in the clinic early next year. We'll get a readout fairly quickly. That will be in a population that would otherwise not be eligible for Pluvicto. High GRPR expression, very low to no PSMA expression. Okay. Great. I want to dig a little bit more into the Alzheimer's diagnostic opportunity that's potentially ahead of you here. Specifically, with Leqembi and Kisunla being slowly integrated into the treatment paradigm for Alzheimer's patients, what is the current use case for imaging agents like Neuraseek? What is the current size of the market? I had a few follow-up questions. I think we have a TAM at the end of the decade of around $1.5 billion. Correct. That is with the current therapeutic agents that exist today. There are over 100 agents in development. We are in, with MK-6240, for example, 103 academic trials and over 15 major pharma sponsored studies, everyone from J&J to Lilly to Merck. We are working with everybody here. They really want our tracers. I think the use case is quite strong. I think the approval of a blood test is a significant advance. I think it can only build a more rational TAM. If you notice and if you read the FDA sort of press release when they approve the blood test, they sort of suggest that it is in place of or can be used in place of unnecessary PET scans. What does that really mean? It means if you suspect AD and you did not have a blood test available, your only real choice was to get a PET scan. However, now you have a blood test. If you are positive, then it is the absolute reason why you need a PET scan. Because you need quantification. You are trying to shrink beta-amyloid. You need to know what you are starting out with, and you need to know what is shrinking. You can quantify it with a beta-amyloid scan. Also, with a tau scan, you can track a patient longitudinally. You can see what area of the brain is affected, which would also directly correlate with symptoms: vision, memory, gait, etc. There is a real paradigm here. The blood test, I think, builds our TAM. It is more constructive. Right. In terms of patient identification. Right. Absolutely. Maybe just in terms of current utilization, how much of it is sort of pre-treatment scan versus staging and follow-up and monitoring of patients on therapy? Do you have any rough sense of how it's being utilized in real-world practice? Yeah. I think when we look at claims data, a lot of it is basically as a part of an initial diagnosis and workup. You can certainly see amyloid on an MR or CT, but you can't really quantify it. I think now what we're seeing is it's part of the initial workup. Then before patients go on a definitive beta-amyloid therapy, they're getting another scan. They would get a scan at the end of completion of that therapy or if they're going to continue on therapy for some reason, maybe at the one-year mark. We're averaging in the TAM one and a half scans a year. With a very good therapeutic, that could go for up to two or three. Right now, we're looking at one and a half scans per year per patient. Okay. Great. I want to maybe take a minute to discuss the other side of it, which you mentioned, which is the tau side and tau opportunity. In our prior conversations, you've expressed a lot of enthusiasm for the tau side of things, even though there isn't yet an approved therapeutic on that side. I guess right now, you have some relatively late-stage pipeline assets for tau could be potentially in the market in 12 to 18 months, roughly speaking. Can you help us think about what is the near-term opportunity and use case for it without a therapeutic on the market? Maybe how do you think about a longer term? Yeah. I think in the short term, without a tau-specific therapeutic, it's a build, to be perfectly honest. We're in the Stanley Cup finals. We're going to use a Gretzky. We're skating to where the puck is going to be. With tau, we believe, and I think we have a lot of support for this, that eventually it will be more important than a beta-amyloid scan. More specifically, tau deposition is directly correlated to symptomatology. Where in the brain you can trace to exactly where the symptoms are. For being able to follow a patient longitudinally, it's very important and very insightful. I think the other part of it is if you have or if a subject has a significant tau accumulation, they should absolutely not get a beta-amyloid therapy because it will not work. In fact, you're exposing them to unnecessary treatment. I think Lilly did a masterful job of keeping tau out of the label. The one thing it should have done is put tau in the label. People who have extensive tau deposition are probably not candidates for therapy. All of the trials for therapeutics are using MK and beta amyloid therapy in general as entry criteria to get into the trial. I think it's a build. Once there's a tau therapy, I think it becomes a whole different story. I could speculate on the growth, but if it's a safe product that has some effectiveness and it works against tau, it'll be a blockbuster. Okay. Great. In our remaining time, we have a few minutes left here. I want to talk a little bit about portfolio management on the other side. You've been both in acquisition mode as well as divestment mode. Can you maybe talk to us what was the reason as you reviewed your portfolio about selling your SPECT business to SHINE? How do you think about this versus sort of the broader Alzheimer's strategy that you've laid out on the imaging side and so forth? I'll let Bob comment a little bit more on the Shine divestiture. If you think about it, we're basically simplifying our organization around a strategic direction. We're driving our company to more and more innovation. We're staffing and buying and doing business development accordingly. We're also trying to find a home for a wonderful business that's been the core of this company that has growth potential in someone else's hands. Yeah, I mean, this is a win-win for both companies in the sense that this is, in their hands, an opportunity for them to draw stability in this part of the business. For us, and that's given their vertical integration into that space. For us, while we will take out $120 million worth of revenue on the top line, its gross margin had created by a couple hundred basis points, as I mentioned. Even at net income, it is effectively a break-even on an adjusted management basis. That's just in our hands. They will be able to do much more with that. From that perspective, it helps us refocus how our P&L is put together. As Brian just mentioned, it's obviously our ability to focus on these new assets as well as the continued commercialization of what we have out there in the field already. Again, it's a win-win. We're thrilled to be partnered with them. We look forward to being able to close that transaction year-end-ish. Okay. Great. I wanted to maybe just squeeze in one more quick one, please, just on the cardiology side, which I think people are just also struggling to understand a little bit. You may or may not opt in in the future at some point. Just sort of how do you and your partner think about the potential here with the GE? I think you'd have to leave it to GE. They've already put out some public commentary around what they see as the potential. I think through all the conversations we've had today, it's come up. Naturally, people think it's a very large and sizable opportunity, and we would agree. We're not opting in for anything. We're letting GE run with the program here. The co-promote option that we have sounds interesting on paper, but it's not worth it for us. It's their asset. They're running the show. We think it's got a tremendous amount of potential in their hands because they're able to sync up the technology with the drug, tracer with the camera strategy. That's perfect for them. Great. Okay. We're at time, so we'll end it on that note. My thanks to Brian and Bob for joining us. Thank you. Thank you.