Legend Biotech Corporation (LEGN) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call and Q&A reveal a positive outlook with plans for CARVYKTI expansion, strong market penetration, and strategic partnerships. The company projects profitability by 2026 and is addressing hurdles for community expansion. Analysts' questions indicate confidence in growth, and management's responses highlight significant opportunities, especially in the U.S. and ex-U.S. markets. Despite some uncertainties, the overall sentiment is optimistic, supported by strategic initiatives and market validation of CAR-T therapy.
Key Financial Performance
CARVYKTI net trade sales Approximately $555 million, a 66% increase year-over-year. The increase is attributed to global growth driven by continued share gains, site expansion, and a growing geographic footprint.
U.S. net trade sales of CARVYKTI $420 million, a 38% increase year-over-year. Growth was driven by the move towards earlier line settings and increased patient adoption.
Ex-U.S. sales of CARVYKTI $135 million, representing an over threefold increase compared to the same period a year ago. Growth was supported by expansion in key markets like Germany, Spain, and Belgium, and the addition of the Tech Lane facility in Belgium for commercial production.
Revenue $306 million, representing 64% year-over-year growth. Growth was driven by the momentum of CARVYKTI and its expanding global footprint.
Gross margin 61%, with a gross margin on CARVYKTI net product sales of 57%. Stability in gross margins reflects the scalability of the CARVYKTI franchise.
Operating margin Improved from negative 142% in Q2 2023 to negative 6% in Q4 2025. This improvement reflects the scalability of CARVYKTI and disciplined cost management.
Operating loss Approximately negative $20 million, a 75% improvement compared to the prior year. This improvement is due to revenue growth outpacing operating expense growth.
Adjusted net income $2.5 million, a significant improvement from a $59 million adjusted net loss a year ago. This reflects the profitability of the CARVYKTI franchise and disciplined expense management.
Adjusted diluted income per share $0.01, compared to negative $0.15 for the same period last year. This improvement is due to the profitability of CARVYKTI and overall financial performance.
Cash position $949 million in cash, cash equivalents, and time deposits. This strong cash position supports investment priorities and reflects improved operating cash flows.
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Operating Highlights
CARVYKTI profitability: Achieved profitability in 2025, with net trade sales of approximately $555 million in Q4 2025, a 66% year-over-year increase.
CARVYKTI efficacy: Presented data showing durable responses and improved outcomes with earlier treatment, including a median PFS of 50.4 months for certain patients.
LUCAR-G39D: Presented data on this first-in-class allogeneic gamma delta CAR-T cell therapy, showing manageable safety and encouraging antitumor activity.
Global market expansion: CARVYKTI is now offered in 14 global markets with 294 treatment sites, including new production facilities in Belgium for ex-U.S. markets.
U.S. market growth: U.S. net trade sales reached $420 million in Q4 2025, a 38% year-over-year increase.
Manufacturing capacity: Expanded capacity to support annual production of 10,000 doses with a 97% manufacturing success rate.
Operational efficiency: Operating margin improved from negative 142% in Q2 2023 to negative 6% in Q4 2025, with adjusted net income of $2.5 million in Q4 2025.
Strategic focus on earlier treatment: Emphasized earlier treatment with CARVYKTI for better outcomes and lower lifetime costs, supported by CARTITUDE-5 and 6 studies.
R&D pipeline: Investing in next-generation cell therapies, including in vivo CAR-T programs and autoimmune programs, with plans to file 1-2 U.S. INDs by year-end.
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Risk or Challenges
Regulatory Risks: The company is subject to risks and uncertainties related to forward-looking statements, as discussed in their SEC filings. These could impact their actual results and operations.
Manufacturing Challenges: While CARVYKTI has a high manufacturing success rate (97%), there are still instances of out-of-spec products, particularly for patients with more than three prior lines of therapy (9.2% out-of-spec rate).
Economic and Financial Risks: The company is not yet enterprise-wide profitable, with an operating loss of approximately $20 million in the fourth quarter of 2025. Although CARVYKTI became profitable in 2025, the company-wide profitability is only anticipated in 2026.
Market Penetration Challenges: BCMA-directed therapies remain significantly underpenetrated in earlier lines, with less than 5% of patients in the second through fourth line setting treated with a BCMA-targeting agent in 2025. This presents a challenge in achieving broader market adoption.
Safety and Efficacy Risks: There are risks associated with neurotoxic events such as Parkinsonism in CARVYKTI-treated patients, particularly those who do not respond to bridging therapy. Effective bridging therapy is critical to mitigate these risks.
Competitive Pressures: The company faces competition in the CAR-T therapy market, and while CARVYKTI has shown strong results, maintaining its leadership position will require continued innovation and market expansion.
Supply Chain and Capacity Risks: Although the company has expanded its manufacturing capacity to support 10,000 doses annually, any disruptions in the supply chain or manufacturing processes could impact their ability to meet demand.
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Guidance & Outlook
Company-wide profitability: Legend Biotech anticipates achieving company-wide profitability in 2026, following CARVYKTI's profitability in 2025.
CARVYKTI sales potential: The company expects CARVYKTI to reach more than $5 billion in peak annual sales, supported by capacity expansion and earlier-line studies.
CARVYKTI market expansion: Legend Biotech is advancing earlier-line studies (CARTITUDE-5 and 6) to expand CARVYKTI's addressable market and expects to share data upon reaching prespecified events.
R&D pipeline growth: The company plans to file 1 to 2 U.S. INDs by the end of 2026 and continues to invest in blood cancers, solid tumors, and autoimmune programs with transformative potential.
Manufacturing capacity: Legend Biotech has the capacity to manufacture 10,000 doses of CARVYKTI annually and is expanding its manufacturing capabilities to meet future demand.
Revenue growth and operating leverage: The company projects continued revenue growth and operating leverage, with a focus on scaling responsibly and achieving enterprise-wide profitability in 2026.
Investment priorities: Legend Biotech will focus on advancing in vivo programs, synergistic business development, CARVYKTI profit expansion, and modest capital expenditures for manufacturing capacity.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:What are the expectations for the pace of CARVYKTI growth in 2026 and how does it compare between the U.S. and the rest of the world?
A:The company is planning for sequential growth throughout all four quarters of 2026 and is confident in delivering CARVYKTI according to the Street consensus of about 50% top-line growth from last year.
Q:What does the company mean by focused synergistic business development?
A:The company is interested in technologies complementary to their in-house capabilities, such as lentiviral vector-based delivery for in vivo CAR-T programs. They are also exploring partnerships to accelerate global development of their in vivo assets.
Q:How are providers positioning the use of bispecifics in early lines relative to CARVYKTI?
A:Providers see a significant opportunity for CAR-T adoption in second and third lines, with CARVYKTI offering unique value as a one-time infusion delivering long-term survival benefits. IMWG guidelines emphasize sequencing to prioritize CAR-T over bispecifics to maintain efficacy.
Q:What are the hurdles for community setting expansion of CARVYKTI?
A:The main hurdles include site activation and training community physicians. The company is addressing these by expanding activated treatment centers, increasing referrals, and educating community physicians about the benefits of CARVYKTI.
Q:What are the practical targets for CAR-T penetration in multiple myeloma?
A:The company aims to increase CAR-T penetration beyond the current less than 10% in fifth line and less than 5% in second to fourth line. They plan to scale up to 20,000 doses annually and emphasize CARVYKTI's efficacy, convenience, and cost-effectiveness.
Q:When did the Raritan facility receive full approval and how is it impacting gross margins?
A:The Raritan facility received full approval earlier this year. It is expected to improve gross margins over time as utilization increases and manufacturing costs decrease.
Q:What are the implications of a competitor's acquisition by Gilead and their standard review by the FDA?
A:The acquisition validates the market value of CAR-T in multiple myeloma. The FDA's standard review of the competitor's application suggests no clinical differentiation over existing therapies, reinforcing CARVYKTI's unmatched efficacy and durability.
Q:Is it feasible for multiple companies to manufacture enough BCMA CAR-T to saturate the market?
A:The company believes the market is not zero-sum and there is significant room for growth. They are scaling up capacity and exploring automation to meet increasing demand.
Q:What is the company's strategy for leveraging lentiviral infrastructure and exploring non-viral platforms?
A:The company is focusing on lentiviral vector-based delivery for in vivo CAR-T programs but is also exploring non-viral platforms like LNP encapsulated RNA or DNA for broader applications.
Q:How does the company view the potential for filing on MRD results for CARTITUDE-6?
A:The company is exploring the correlation between MRD activity and clinical outcomes in CAR-T trials. If validated, this could accelerate FDA filing for CARTITUDE-6.
Q:What is the current breakdown of CARVYKTI patients in second and third line?
A:Second and third line patients now account for 65% of CARVYKTI's business, with this segment growing the fastest.
Q:How is CARVYKTI performing in ex-U.S. markets?
A:CARVYKTI is seeing significant uptake in 13 ex-U.S. markets, with rapid adoption in early lines, particularly in countries like Spain where 75% of use is in second and third lines.
Q:What is the company's approach to developing new CAR-T modalities?
A:The company is focusing on in vivo CAR-T due to its convenience and lack of rejection issues. They are using metrics like MRD activity and PK/PD to evaluate early efficacy and long-term outcomes.
Q:What is the progress on mitigating delayed neurotoxicity events with CARVYKTI?
A:The Citadel study and other trials are investigating strategies like ALC monitoring and bridging therapy, with data expected this year. Bridging therapy is becoming a standard of care to improve safety and efficacy.
Q:When can we expect data from the company's in vivo programs?
A:The first batch of clinical data for the in vivo program is planned to be presented at a major medical meeting potentially in the middle of this year.
Q:What does the 10,000 dose capacity represent in terms of manufacturing?
A:The 10,000 dose capacity represents the overall manufacturing capacity, accounting for factors like shutdowns, non-clinical runs, and out-of-spec doses.
Q:Review of Unclear Management Responses
A:Management avoided providing specific timelines or detailed data for certain initiatives, such as the exact timing of CARTITUDE-6 filing based on MRD results and the detailed progress of in vivo CAR-T programs. Additionally, they did not provide a clear breakdown of CARVYKTI's performance in specific ex-U.S. markets beyond general trends.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
ASH Tandem
CAR sale
CARVYKTI bar
CARVYKTI manufacturing
CARVYKTI myeloma
CARVYKTI profitability
Legend
PFS month
Parkinsonism
President Investor
Relations Finance
Tandem meeting
Vice President
analysis patient
body evidence
bridging therapy
capacity dos
event
income loss
line therapy
meeting CARVYKTI
myeloma patient
outcome CARVYKTI
outcome line
patient line
patient progression
potential
rate market
safety outcome
scale
spec product
success rate
survival outcome
term benefit
treatment CARVYKTI
tumor
LEGN Transcript
Legend Biotech Corporation (LEGN) Q4 2025 Earnings Call Transcript
Positive3-10
The earnings call and Q&A reveal a positive outlook with plans for CARVYKTI expansion, strong market penetration, and strategic partnerships. The company projects profitability by 2026 and is addressing hurdles for community expansion. Analysts' questions indicate confidence in growth, and management's responses highlight significant opportunities, especially in the U.S. and ex-U.S. markets. Despite some uncertainties, the overall sentiment is optimistic, supported by strategic initiatives and market validation of CAR-T therapy.
Legend Biotech Corporation (LEGN) Presents at 44th Annual J.P. Morgan Healthcare Conference Transcript
Neutral1-14
Legend Biotech Corporation (LEGN) Q3 2025 Earnings Call Transcript
Positive11-12
The earnings call highlights operational breakeven for CARVYKTI and company-wide profitability by 2026, which are positive indicators. The removal of REMS by the FDA, expansion plans, and strong demand in international markets further support a positive outlook. However, management's reluctance to provide specific timelines and details in some areas tempers expectations. Overall, the strategic plan and Q&A insights suggest a positive sentiment, likely resulting in a stock price increase of 2% to 8%.
Legend Biotech Corporation (LEGN) Presents At Morgan Stanley 23rd Annual Global Healthcare Conference Transcript
Neutral9-9
LEGN Slides
LEGN Report
Frequently Asked Questions
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