Halozyme posted record second-quarter revenue of $326 million, up 41%, driven by 65% royalty growth from its three blockbuster subcutaneous ENHANZE therapies, with adjusted EBITDA up 65% to $225.5 million and 11 of 14 identified growth catalysts already realized. The quarter showed no notable operational setbacks, though management is contesting Merck IP litigation and patent challenges and a CMS draft Part B policy it views as flawed. The company raised full-year guidance for the second time this year, lifting total revenue projections by an additional $75 million to $1.275-$1.355 billion and increasing its royalty, adjusted EBITDA, and EPS outlooks.
Thank you, operator. Good afternoon, and welcome to our Second Quarter 2025 Financial and Operating Results Conference Call. In addition to the press release issued today after the market close, you can find a supplementary slide presentation that will be referenced during today's call in the Investor Relations section of our website. Leading the call will be Dr. Helen Torley, Halozyme's President and Chief Executive Officer, who will provide an update on our business, and Nicole LaBrosse, our Chief Financial Officer, will review our financial results as well as our outlook.
We will be making forward-looking statements as outlined on slide two. I would also refer you to our SEC filings for a full list of risks and uncertainties. During the call, both GAAP and non-GAAP financial measures will be discussed. Certain non-GAAP or adjusted financial measures are reconciled with the comparable GAAP financial measures in our earnings press release and slide presentation. I will now turn the call over to Dr. Helen Torley.
Good afternoon, everyone, and thank you for joining us today. Let me begin on slide three. I'm pleased to announce another record quarter, which highlights the significant growth and accelerating momentum we have across the business. Total revenue in the quarter was $326 million, representing a 41% increase over the second quarter of the prior year. This robust growth was driven by continued strong royalty revenue performance, driven by our three established blockbuster subcutaneous therapies, Darzalex subcutaneous, subcutaneous Phesgo, and Vyvgart Hytrulo. This quarter's royalty revenue grew an impressive 65% year-over-year to $206 million. Adjusted EBITDA increased an outstanding 65% over the prior year's second quarter to $226 million. This was driven by the accelerating growth of our high-margin royalty revenue streams, as a result of increasing demand for products, incorporating our leading drug delivery technology, ENHANZE.
Based on this strong continued performance and the growth trends, I am pleased to announce that we are raising our 2025 financial guidance for the second time this year. We are now projecting total revenue of $1.275 billion-$1.355 billion, representing 26%-33% growth over 2024. This is a further increase to revenue guidance of $75 million, after raising guidance by approximately $50 million in the first quarter reporting. 2025 full-year royalty revenue guidance has increased to $825 million-$860 million, representing growth year-over-year of 44%-51%. Adjusted EBITDA and non-GAAP EPS guidance have also been raised, and Nicole will go into more detail on this shortly. During the quarter, we completed the second $250 million share repurchase tranche of our authorized $750 million share repurchase plan. I'm pleased that we also initiated our third $250 million share repurchase program under the approved $750 million plan.
Importantly, the strength of our revenue growth and the resulting strong cash generation enable us to be able to add this additional $250 million of share repurchases, while being able to pursue our M&A goals. With regard to M&A, we are continuing to focus on identifying new drug delivery platforms where the business model results in long, durable revenue streams, such as through royalties, and where we see the opportunity to license the technology to multiple pharma partners. We heard your leverage, and we are seeking deals that can be accomplished without the need for significant increases in net debt to EBITDA leverage. I'll move now to slide four. On the first quarter call, I highlighted multiple catalysts for our current portfolio, which had just occurred, of which we are expecting throughout the year, that will drive incremental strong revenue and EBITDA growth for multiple years to come.
There are now 14 catalysts, of which I am pleased to note 11 have already occurred. While I will highlight these exciting growth catalysts in more detail as we review each product, I want to highlight and emphasize how each catalyst represents a meaningful revenue growth inflection for our royalty revenue. Let me begin with a new product approval and a new royalty revenue stream, which was for Rybrevant subcutaneous in Europe in April. Johnson & Johnson has commented on the critical role that subcutaneous Rybrevant is playing in achieving their ambitions to grow Rybrevant to become a $5 billion brand.
There are two recent first-time approvals in a major region, specifically for Opdivo subcutaneous in Europe and for Vyvgart Hytrulo in chronic inflammatory demyelinating polyneuropathy, or CIDP, also in Europe, both of which occurred in the second quarter and which represents additional revenue inflecting opportunity as adoption grows in Europe. There have been five new indication approvals. Let me highlight Darzalex subcutaneous, which gained new indication approvals in smoldering multiple myeloma and in a new frontline indication in Europe, which expands their TAM in patients early in the disease and provides a meaningful new growth opportunity and revenue inflection opportunity to Halozyme. Another new indication approval was the Vyvgart Hytrulo prefilled syringe, which we know is already contributing and creating an inflection in the growth of Vyvgart Hytrulo after just one quarter.
I will close on three major reimbursement milestones which have recently occurred, including Phesgo's reimbursement in China and permanent J codes added for Ocrevus Zunovo and Opdivo Qvantig, all of which add to and will expand our opportunity, adoption, and create royalty revenue inflections. In our history as a company, we have never had such a broad and meaningful set of growth catalysts, creating new additional incremental royalty streams and revenue inflection across so many products. These catalysts extend beyond supporting our growing commercial success, but also reflect the important role our ENHANZE technology is playing in significantly enhancing patient access, improving convenience for patients, and addressing unmet patient needs. I'll now focus on the three blockbuster products that are driving our remarkable current growth, starting with Darzalex, which is shown on slide five.
Johnson & Johnson reported strong second-quarter results for Darzalex, with revenue increasing almost 22% to $3.5 billion in the quarter. Growth was driven by share gains of approximately four points across all lines of therapy, and almost eight points in the frontline setting, in addition to market growth. I want to highlight two critical points here. Firstly, the subcutaneous delivery of Darzalex with ENHANZE has reached 96% conversion in the United States, with a similarly high conversion rate outside the United States, meaning that it is the subcutaneous treatment version on which Halozyme receives a mid-single-digit royalty that is driving and benefiting from the strong growth I just mentioned. Secondly, quarter after quarter, Johnson & Johnson has commented on the robust share gains for Darzalex subcutaneous in the frontline setting.
This is important, as frontline patients as a whole have a longer survival and often a longer duration of treatment compared to the later-line patients. The increased penetration in frontline is what is driving today's strong growth, and we project that it will continue for many years to come. Moving now to the recent catalysts that provide new opportunity and growth, Darzalex subcutaneous recently received two new approvals in Europe. The first is for subcutaneous Darzalex, as part of a quadruplet regimen for newly diagnosed patients, regardless of transplant eligibility. The second is for high-risk smoldering multiple myeloma. The approval in high-risk smoldering multiple myeloma was based on the phase III AQUILA study, which showed a significantly reduced risk of progression to active multiple myeloma or death by 51% compared to the current standard of care, which is active monitoring.
The new indication addresses a longstanding unmet clinical need, and marks a critical advancement in the early intervention of the disease for those who are at high risk. To help you dimensionalize this opportunity, in Europe in 2022, approximately 35,000 patients were diagnosed with multiple myeloma, of whom 15% had smoldering multiple myeloma. For those with high-risk smoldering multiple myeloma, half will progress to multiple myeloma within two years. For these patients, this approval for Darzalex subcutaneous marks the first ever approved therapeutic intervention, and the hope that progression to full-blown multiple myeloma can be slowed. Turning to the U.S. regulatory approval status, in May, Johnson & Johnson announced the U.S. Food and Drug Administration Oncologic Drug Advisory Committee voted in favor of the benefit-risk profile of Darzalex Faspro, for the treatment of adult patients with high-risk smoldering multiple myeloma.
The projection from analysts for Darzalex is approximately $18 billion in sales in 2028, and Halozyme will earn royalties in Darzalex with ENHANZE through 2032. Turning to our second blockbuster, Roche's Phesgo, which is shown on slide six. Phesgo, which is the combination of Perjeta, Herceptin, and ENHANZE, represented the leading growth driver in Roche's pharma portfolio, with first half 2025 revenue of CHF 1.2 billion or approximately $1.5 billion, reflecting a 55% year-over-year growth. There was strong uptake across all regions, with the global conversion from Perjeta to Phesgo at 46% across 78 launch countries, which increased from 58 launch countries in the first quarter. The convenience of Phesgo was also reinforced in April, with a CHMP recommendation for a European label expansion, allowing administration outside of clinical settings, such as at home by a healthcare professional, once safety has been established.
This label expansion represents another growth catalyst for Phesgo. Roche's project conversion from Perjeta will continue, bringing an improved treatment experience for patients and the potential to significantly reduce treatment administration costs. We're pleased with Phesgo's increasing reach, and the impact of our ENHANZE technology platform, with royalties at the full mid-single-digit rate through 2030. Let me move now to slide seven.
Our partnership with argenx reflects a shared mission to provide innovative new treatment options for patients globally. The success of Vyvgart and of Vyvgart Hytrulo, which is a subcutaneous formulation with ENHANZE, are a great demonstration of how innovation can support patient outcomes. Vyvgart Hytrulo continues to be a key driver of the exceptional growth of Vyvgart total sales, which increased 97% year-over-year in the second quarter to $949 million. Vyvgart Hytrulo is now approved in the U.S. and Europe in two indications, generalized myasthenia gravis and CIDP.
Thank you, Helen. Our outperformance in the second quarter reflects the growing momentum in the business, supporting another raise to our 2025 financial guidance. Total quarterly revenue increased by 41%, with $206 million in royalty revenue increasing 65%. Adjusted EBITDA growth of 65% once again outpaced top-line growth, with high-margin royalty revenue contributing to the $98 million in free cash flow in the quarter. Moving to slide 10. In the second quarter, we completed the $250 million share repurchases announced in May of 2025. Given our expectation for continued strong cash generation, we have allocated an additional $250 million to share repurchases. Of this third and final tranche of our current $750 million approved plan, $53.5 million was deployed in the second quarter, bringing our total share repurchases in the second quarter to $303.5 million.
This brings total share repurchases since 2019 to more than $1.85 billion, reflecting 117% of our cumulative free cash flow during that period. We continue to balance our use of capital with a focus on evaluating M&A opportunities to complement our strong organic growth profile, while remaining disciplined about our net leverage. Let me now turn to our detailed second quarter results on slide 11. Revenue grew 41% to $325.7 million compared to $231.4 million in the prior year period. Royalty revenue of $205.6 million increased by 65% from $124.9 million in the prior year period. The continued commercial success of subcutaneous Darzalex and Phesgo, and the robust growth of Vyvgart Hytrulo contributed to the higher-than-expected royalty growth. Product sales of $81.5 million increased by 3% from $78.9 million in the prior year period, mainly driven by higher proprietary product sales.
Collaboration revenue of $38.6 million, an increase of 40% from $27.5 million in the prior year period, reflect the milestone recognition of the approval and EU launch of Rybrevant SC in April, and a milestone recognized for the EU approval of Opdivo SC. Research and development expenses were $17.5 million, compared to $21 million in the prior year period. The decrease was primarily due to lower compensation expense, driven by resource optimization and labor allocation initiatives, offset by timing of planned investments in ENHANZE, related to the development of our new high-yield rHuPH20 manufacturing process. Selling, general, and administrative expenses were $41.6 million in the quarter, up from $35.7 million in the prior year period, primarily due to increased compensation expense and consulting and professional service fees. Adjusted EBITDA increased by 65% to $225.5 million from $137 million last year.
GAAP diluted earnings per share was $1.33, and non-GAAP diluted earnings per share was $1.54. This is compared with GAAP diluted earnings per share of $0.72, and non-GAAP diluted earnings per share of $0.91 in the second quarter of 2024. We continue to maintain a strong balance sheet with cash, cash equivalents, and marketable securities of $548.2 million on June 30th, 2025, compared to $596.1 million on December 31st, 2024. The decrease was primarily a result of share repurchases, offset by an increase in cash generated from operations. Our net debt position was $977 million, with a net leverage ratio of 1.2x. Turning now to slide 12 and our updated 2025 guidance, we are excited to be able to raise our guidance for the second time this year.
We now expect total revenues of $1.275 billion-$1.355 billion, representing year-over-year growth of 26%-33%, driven by an increase in projections for royalty revenues. Royalty revenue of $825 million-$860 million, representing year-over-year growth of 44%-51%. As Helen touched on, we expect Darzalex SC, Phesgo, and Vyvgart Hytrulo to drive the strong expectations, with Vyvgart Hytrulo being the largest royalty dollar growth driver. Product sales have not changed at $340 million-$365 million, representing year-over-year growth of 12%-20%. Collaboration revenue is also maintained at $110 million-$130 million. We expect adjusted EBITDA of between $865 and $915 million, representing year-over-year growth of 37%-45%, reflecting high-margin royalty growth, coupled with flat operating expense from our continued focus on operational efficiency and non-GAAP diluted EPS of $6-$6.40, representing year-over-year growth of 42%-51%.
As you refine your models, I'd also like to reiterate the following. We expect collaboration revenue for the rest of the year to be more weighted in the fourth quarter. We expect product sales for the rest of the year to also be more weighted in the fourth quarter, with quarterly sequential growth in each quarter. For royalties, we expect quarterly sequential growth for the remaining quarters in the year. With that, I'll now turn the call back over to Helen.
Thank you, Nicole. It is certainly an exciting time in Halozyme's history, as we continue to achieve new record revenue and earnings growth. With 14 catalysts for growth now realized or on the near-term horizon, we have even greater conviction and line of sight in the durability of our revenue streams, and the expanding opportunities ahead. Our success would not have been possible without the incredible dedication of our employees, and the trust and collaboration of our valued partners. With that, now operator, we are now ready to open the call for questions.