UnitedHealth Group cuts profit outlook, citing higher-than-expected Medicare Advantage care costs

 UnitedHealth Group reported $6.29 billion in profit for the first quarter of 2025, or $6.85 a share, far exceeding its performance in the same quarter a year ago. In the first quarter of 2024, the healthcare giant reported a loss of $1.41 billion,  or a loss of $1.53 a share.

First-quarter 2025 revenue jumped 9.8% to reach $109.6 billion, up $9.8 billion from $99.8 billion a year ago.But UnitedHealth Group cut its earnings guidance after reporting higher-than-expected care costs in its Medicare Advantage businesses, "far above" the planned 2025 increase. The "heightened care activity indications within UnitedHealthcare’s Medicare Advantage businesses" became "visible as the quarter closed," the company said in an earnings press release issued Thursday morning.

"This activity was most notable within physician and outpatient services," the company said.

UnitedHealth Group cut its outlook to net earnings of $24.65 to $25.15 per share for the year and adjusted earnings of $26 to $26.50 per share for 2025. That's down from previous guidance of net earnings of $28.15 to $28.65 per share and adjusted net earnings of $29.50 to $30 per share.

The company also cited "unanticipated changes in the profile of Optum Health members impacting planned 2025 reimbursement due to unexpectedly minimal 2024 beneficiary engagement by plans exiting markets."

Further, executives cited "greater-than-expected impact to current and new complex patients from the ongoing Medicare funding reductions enacted by the previous administration."

“UnitedHealth Group grew to serve more people more comprehensively but did not perform up to our expectations, and we are aggressively addressing those challenges to position us well for the years ahead, and return to our long-term earnings growth rate target of 13 to 16%,” said Andrew Witty, CEO of UnitedHealth Group, in a statement.

"The company believes these factors to be highly addressable over the course of this year as well as it looks ahead to 2026," executives said in the press release.

UnitedHealth Group reported adjusted earnings of $7.20 a share for the quarter.

Both first-quarter revenue and earnings missed Wall Street analysts' expectations. Analysts had been expecting adjusted earnings of $7.29 per share for the quarter and revenue of $111.58 billion, according to FactSet.

UnitedHealth shares fell 19% in premarket trading Thursday.

The company is holding a call with investors at 8:45 am ET to review its first-quarter financial performance.

https://www.fiercehealthcare.com/payers/unitedhealth-group-cuts-profit-outlook-citing-higher-expected-medicare-advantage-care-costs

Lilly's oral GLP-1 drug delivers Ozempic-like efficacy in phase 3 diabetes trial

 Eli Lilly has met its goal of achieving semaglutide-like efficacy with an oral GLP-1 drug. The phase 3 study linked the oral GLP-1 drug orforglipron to similar reductions in blood glucose and body weight to Novo Nordisk’s injectable blockbuster, although the figures are down on Lilly’s midphase data. 

Speaking on an earnings call in February, Daniel Skovronsky, M.D., Ph.D., chief scientific officer at Lilly, was clear about the objectives for orforglipron. Lilly’s goal was to deliver an oral drug  with an “efficacy, safety and tolerability profile that is similar to that of an injectable single-acting GLP-1.” Semaglutide, which Novo sells as Ozempic and Wegovy, is the leading injectable single-acting GLP-1.

Lilly reported the first phase 3 data on orforglipron Thursday. The study randomized people with Type 2 diabetes to receive one of three doses of orforglipron or placebo. After 40 weeks of once-daily dosing, A1C, a measure of blood sugar, fell between 1.3% and 1.6% in the orforglipron cohorts, compared to a 0.1% drop in the placebo group. The result caused the trial to meet its primary endpoint.

Novo reported (PDF) A1C reductions of 1.4% to 1.6% after 30 weeks of dosing with Ozempic in a previous phase 3 trial. Lilly saw a steeper drop in A1C in its phase 2 trial, when it linked orforglipron to reductions of up to 2.1% after 26 weeks of treatment. Lilly didn’t take the highest dose from phase 2 into phase 3. 

ight loss was a key secondary endpoint in Lilly’s phase 3 orforglipron trial. After 40 weeks, patients on the oral GLP-1 drug candidate had lost between 4.7% and 7.9% of their body weight, with participants on the highest dose losing the most weight. At the top dose, patients lost an average of 7.3 kg of the 90.2 kg they weighed at the start of the trial. In Novo's phase 3 trial, patients on Ozempic lost up to 4.7 kg from mean starting weights of up to 96.9 kg. 

As with A1C, Lilly saw steeper reductions in body weight in its phase 2 trial, when the company posted mean weight loss of up to 10.1 kg after 26 weeks on orforglipron. Skovronsky has said Lilly expects weight loss seen in people with diabetes to be significantly less than in people living with obesity.  

The drugmaker also shared a snapshot of safety and tolerability data. The most common adverse events were diarrhea, nausea and indigestion, which respectively affected up to 26%, 18% and 20% of patients on the oral GLP-1 drug. For comparison, Novo reported rates of nausea and diarrhea of 20% and 9%, respectively, in its phase 3 trial.

The readout marks the start of a wave of data drops for orforglipron. Skovronsky has previously said Lilly expects to see data from up to five studies in Type 2 diabetes and two trials in obesity, with two phase 3 obesity readouts scheduled for the third quarter. Lilly plans to use the data to seek approval in obesity this year, with submissions in Type 2 diabetes penciled in for 2026.

Citi analysts said in a note this morning that the readout exceeded market expectations of around 5-6% weight loss for orforglipron, while the lack of liver toxicity will be a "sigh of relief to many" after Pfizer discontinued its oral GLP-1 earlier this week for this reason. Lilly stock was up 15% to $844.69 in the opening hour of trading Thursday from a Wednesday closing price of $734.90.

https://www.fiercebiotech.com/biotech/lillys-oral-glp-1-drug-delivers-ozempic-efficacy-phase-3-diabetes-trial

Regeneron gets FDA acceptance to review expanded label for Eylea HD

 Regeneron announces FDA review of sBLA for Eylea HD to treat macular edema and expand dosing

https://seekingalpha.com/news/4432107-regeneron-gets-fda-acceptance-to-review-expanded-label-for-eylea-hd

uniQure Breakthrough Designation to AMT-130 for Huntington’s

uniQure (NASDAQ: QURE) has received FDA Breakthrough Therapy designation for AMT-130, its gene therapy treatment for Huntington's disease, a rare inherited neurodegenerative disorder with no current disease-modifying therapies.

The designation is based on promising interim data from Phase I/II trials showing dose-dependent slowing of disease progression. The company presented 24-month data in July 2024, demonstrating meaningful disease progression slowdown based on cUHDRS scores compared to natural history.

AMT-130 has already received Regenerative Medicine Advanced Therapy (RMAT), Orphan Drug, and Fast Track designations. The treatment has been administered to 45 patients to date, with additional regulatory guidance on the Biologics License Application expected in Q2 2025.

https://www.stocktitan.net/news/QURE/uni-qure-announces-fda-breakthrough-therapy-designation-granted-to-vc0byl7hn43s.html

Nurix gets FDA clearance to initiate trial for its anti-inflammatory drug candidate

 Nurix Therapeutics and Gilead secure FDA IND clearance for GS-6791, targeting IRAK4 protein in inflammatory conditions.

https://seekingalpha.com/news/4432156-nurix-gets-fda-clearance-to-initiate-trial-for-its-anti-inflammatory-drug-candidate

Sanofi in $1.8B research deal for 2 bispecific antibodies for autoimmune, immunology

 Sanofi is continuing to splash the cash for autoimmune and immunology assets this spring by penning a new deal with little-known U.S. artificial intelligence research biotech Earendil Labs in a pact that could be worth up to $1.8 billion. 

The French pharma is handing over $125 million upfront, with a near-term payment of $50 million to follow, for the exclusive worldwide rights to a pair of bispecific antibodies. HXN-1002 targets α4β7 and TL1A with the aim of treating ulcerative colitis and Crohn's disease, while HXN-1003 targets TL1A and IL23 in order to treat colitis and skin inflammation.

Should the two drugs progress through the clinic and reach the market, Sanofi will be liable to pay $1.72 billion in development and commercial milestone payments, which includes that $50 million near-term fee, alongside tiered royalties.

“We firmly believe that Sanofi's extensive expertise in the autoimmune disease field will significantly accelerate the development of HXN-1002 and HXN-1003, ultimately bringing these potentially life-changing treatments to patients worldwide as soon as possible,” Earendil Labs President & co-CEO Zhenping Zhu, M.D., Ph.D., said in an April 17 release.

Little is publicly known about Earendil Labs, which touts itself as a “global leader in AI-driven research and development of next-generation biologics therapeutics.” The biotech describes itself as affiliated with Helixon Therapeutics, a company that, like Earendil, claims to harness machine learning for protein drug design.

"Our platform leverages state-of-the-art predictive protein modeling and high-throughput biology, revolutionizing the discovery and development of bispecific antibodies,” Earendil co-CEO Jian Peng, Ph.D., said in the same release. “This collaboration underscores Earendil Labs' capability to generate potential first-in-class or best-in-class product candidates, with the aim of transforming patient care.”

Sanofi has been on a spending spree in recent weeks to bolster its autoimmune and immunology pipeline, returning to Nurix earlier this month for a $480 million autoimmune deal comprising a degrader of a once-undruggable transcription factor. In March, Sanofi penned a $1.6 billion agreement with Dren Bio for a CD20-directed antibody aimed at B-cell non-Hodgkin lymphoma.

Sanofi—which co-markets the anti-inflammatory blockbuster Dupixent with Regeneron—has been undergoing a major pipeline shake-up in an effort to become “an immunoscience powerhouse," according to an internal letter obtained by Fierce Biotech last year. 

In the pharma’s full-year earnings call in January 2025, Sanofi’s head of R&D, Houman Ashrafian, Ph.D., reiterated this point, reminding investors that the company is becoming a “premier immunology powerhouse” with the option to combine various molecules it is developing in this space.

https://www.fiercebiotech.com/biotech/sanofi-pens-18b-deal-2-bispecific-antibodies-aimed-autoimmune-immunology

Pharma companies expected to absorb any tariff hit in short term

U.S. tariffs on pharmaceuticals could eventually mean higher prices for brand-name medicines, but in the near term the costs would likely be absorbed by drugmakers rather than patients whose payments are often set by health insurance.

U.S. health insurers, which pay the bulk of prescription drug costs, act as a buffer between drugmakers and patients, with beneficiaries subject to co-pays and co-insurance based on the prices insurers negotiate with drugmakers.

"Patented drugs are already generally set at the price the market will bear, so in that sense manufacturers are not likely to substantially increase the prices of these drugs," said Melissa Barber, postdoctoral fellow at Yale University and an expert on drug pricing.

On Monday, the Trump administration said in a regulatory filing it had opened a national security investigation into pharmaceuticals to show why the U.S. needs tariffs to boost domestic manufacturing. Rates and timing remain uncertain, but the industry has been lobbying for phased-in tariffs.

The hit could be big. Close to $213 billion in pharmaceutical products were imported to the U.S. last year, nearly triple 2014's $73 billion, according to the United Nations trade database.

And equity research group Bernstein Societe Generale estimated that U.S. tariffs could add $46 billion in costs to the pharmaceutical industry, compared with current annual revenue of $700 billion for major companies. The threat of import duties has already spurred drugmakers to accelerate shipments to the U.S. and warehouse supplies, which analysts say will protect their 2025 financial outlooks and take the pressure off any immediate price increases.

Some tariff costs could eventually be shifted to patients and the taxpayers who fund U.S. government health programs, but the real risk is to lower-margin, generic drugs, said Robin Feldman, a professor at UC Law San Francisco. Cheaper generic drugs, which are allowed after patents expire on branded products and are mostly made in India and China, account for over 90% of U.S. prescriptions, but just 17% of spending, according to the Association for Accessible Medicines.

The trade group has said their members will not be able to raise prices because their margins are so thin. ING analyst Diederik Stadig estimated that a 25% tariff on India, for instance, would result in an increase of 17.5% for generic drugs produced in India.


Bill Coyle, head of biopharma at consulting firm ZS, said drugmakers will try to pass on tariff costs, but because many categories are very competitive, "the real downstream impact" would be cost-cutting by companies.


Eli Lilly (LLY) CEO Dave Ricks, in a recent BBC interview, said prices for the company's drugs are fixed under commercial and government agreements, "so we have to eat the cost of the tariffs." He said such higher costs would "typically" lead to cuts in staff or research and development activity.

Drugmakers, including Lilly, Novartis (NVS), and Johnson & Johnson (JNJ), are already committing to increasing their U.S. manufacturing footprints, while acknowledging that it will take years to complete new projects.

Pharmaceutical companies in recent decades moved production capacity outside of the U.S., including to European Union countries like Ireland in part because of low-income tax rates for intellectual property on blockbusters like Lilly's weight-loss injection Zepbound and Merck's cancer immunotherapy Keytruda.


At the same time, drugmakers have come to rely on the U.S. market for the bulk of their revenue. In 2022, the U.S. accounted for half of worldwide prescription drug revenue, but only 13% of volume, according to the Iqvia Institute for Human Data Science.

A RAND study of 2022 prescription prices found that U.S. health plans paid more than three times as much for brand-name pharmaceuticals as other countries, even after estimated discounts. A Reuters review found that Medicare's recently-negotiated prices for its 10 most costly drugs are still more than double, and in some cases five times, what drugmakers agreed to in other high-income countries.

Sources said tariffs could be part of a broader administration focus on narrowing the gap between U.S. drug prices and those in foreign countries.

"It's the threat of tariffs that could bring pharmaceutical manufacturers and payers to the table sooner rather than later (to) talk about price," said William Padula, professor of pharmaceutical and health economics at the University of Southern California.

https://finance.yahoo.com/news/analysis-pharma-companies-expected-absorb-100345370.html