Q4 2019 Earnings Call
The latest good day, ladies and gentlemen, and welcome to the Exelixis fourth quarter and for year 2019 financial results Conference call.
My name is to Wanda and I'll be your operator for today.
As a reminder, this call is being recorded for replay purposes.
I would now like to turn the call but to your host for today.
Using <unk> executive Vice President of Public Affairs, and Investor Relations you may begin.
Thank you Twanda and thank you all for joining us for the Exelixis fourth quarter and full year 2019 financial results Conference call.
Joining me on the call today, our Mike Moore see our President and CEO, Chris Center, our Chief Financial Officer, PJ, Haley, our executive Vice President of commercial and Gisela Schwab, Our Chief Medical Officer, who will together review, our corporate financial commercial and development progress for the fourth quarter ended December 31st 2019.
Peter Lamb, our Chief Scientific Officer is also with us and will be joining us for the Q any session. Following our prepared remarks.
During the call today, we will refer to financial measures not calculated according to generally accepted accounting principle. Please refer to today's press release, which is posted on our website for an explanation of our reasons for using such non-GAAP measures as well as tables driving these measures from our GAAP results.
During the course of this presentation, we will be making forward looking statements regarding future events in the future performance of the company. This includes statements about possible developments regarding discovery product development regulatory and commercial financial and strategic matters actual events or results could of course differ materially. We refer you to the documents we filed from time to time with.
The FCC, which under the heading risk factors identify important factors that could cause our actual results to differ materially from those expressed by the complete company verbally and in writing today, including without limitation risks and uncertainties related to product commercial success market competition regulatory review and approval process piece can do.
In clinical trials compliance with applicable regulatory requirements, our dependence on collaboration partners and the level of cost associated with discovery product development business development and commercialization activities now with that I will turn call over to Mike Alright. Thank you Susan and thanks, everyone for joining us on the cold today Exelixis is off to a strong.
Dark in 2020, and we're pleased to provide additional perspective on or 2019 performance as we build off the momentum from JP Morgan presentation, we see the updates at ASCO Gi <unk> do you to frame 2020 and beyond.
Well keep our prepared remarks short and address your questions as the main purpose today's update.
Please see our press release that was issue not an hour ago for an extensive list of our 2019 highlights including is the achievement of more than $1 billion of global net revenue for the accomplishing instead of franchise across the renal cancer liver cancer individually they would cancer indications.
As introduced back in January we expect the 2020 to 2021 timeframe to be a period of focus execution across all components of our business. During 2020, we expect to have 12, Cabo San <unk> label enable in trials enrolling in six topline data we don't.
It could lead to four new potential indications for Cabo and 2021.
We also expect to advance XL onein to into immune checkpoint inhibitor or ipi combination cohorts and file up to three new opportunities for compounds from internal or collaborative efforts.
Recent data presented for Cabo I see I combinations and absolute G.I. for HCC and that's good G. you for metastatic see RPC highlight encouraging data in these important indications and provide a potential read through to cabos dances differentiated activity, which has been previously document.
In the media your Cabelas Sun insult west fuel trials.
So with that I'll turn the call over to Chris who will provide more details on our fourth quarter 2019 financial results.
Thanks, Mike for the fourth quarter 2019, the company reported total revenues of $240.3 million total revenues for the quarter include a comprehensive net product revenues of $194.9 million.
Cabometyx inventory units held at our customers declined by approximately 200 units, which from weeks on hand perspective was flat at 2.6 weeks when compared to the third quarter 2019.
Cabometyx net product revenue was approximately $5 million lower than the preliminary results from the quarter that X, which was provided.
On January 12 2020.
This is due to an increase in the estimated close for chargebacks associated with that product revenues identified during the company's annual financial audit Cometra revenues were higher than they have previously trended due to a clinical trial purchase of approximately $9.4 million. Total revenues also includes the recognition of $45.4 million being collaboration revenues for the companies from the company's commercial cloud.
Operation Partners, if syndicate and genetic.
Our total operating expenses for the fourth quarter, 2019 were $163 million compared to $156.1 million in the third quarter 2019.
Question a expense was the primary driver of the increase in total operating expenses, which increased by $6.8 million has primarily related to ft expenses.
Income taxes for the fourth quarter 2019 were 100 Werent were $16.3 million at our effective tax rate for the quarter was approximately 19.1% compared to $25.2 million and 20.5% for the third quarter 2019.
The company reported GAAP net income of $68.7 million were 22 cents per share on a fully diluted basis for the fourth quarter 2019.
The company also reported non-GAAP net income of $81 million or 26 cents per share on a fully diluted basis.
Non-GAAP net income excludes the impact of approximately $12.3 million of stock based compensation expense net of the related income tax effect.
Cash and investments totaled approximately $1.4 billion at December 31, 2019, compared to approximately $852 million at December 31, 2018.
Turning to our financial guidance, which we previewed at the JP Morgan Conference in January 2020.
Total revenues or expect to be in the range of 850 $900 million net product revenues are projected to be in the range of 725 and $775 million.
Cost of goods sold we expect to be between four and 5% of net product revenues research and development expense and expect to be in the range of 460 and $500 million and includes non cash expenses related to stock based compensation approximately $25 million.
Selling general administrative expenses expects me in the range of 230 $250 million and includes non cash expenses related to stock based compensation approximately $30 million.
Guidance for the effective tax rate in 2020 is between 20 and 22%.
Finally, we are projecting cash and investments to be in the range of 1.5 and $1.6 billion this cash and investments guidance.
It does not include the impact of any potential new business development activities with that ill turn the call over to feature.
Thank you Chris I'm pleased to review the commercial performance of Cabometyx for the fourth quarter 29 team.
Cabometyx continues to be the number one prescribed teekay in RCC, which is notable in the context of three recent purslane launches and immune checkpoint inhibitor for ITI combinations.
Cabometyx demand grew by 11% in Q4 2019 relative to the fourth quarter in 2018 and grew by 3% in Q4 2019 relative to Q3 2019.
The prescriber base of Cabometyx continue to increase in grew by 35% in Q4 2019 relative to Q4 2018 and grew by 6% in Q4 2019 relative to the prior quarter.
Cabometyx continues to be used broadly in RCC across academic and community settings clinical risk groups and lines of therapy.
The first line RCC market has been very dynamic throughout most of 2019, given the launch of two additional first line IC combinations in the second quarter.
As we mentioned on our last call. The first line RCC market began to stabilize at the end of Q3.
And continued in Q4.
Cabometyx first line new patient share has remained steady and I see I combos continue to capture the majority of the first line new patient market share.
Turning to second line RCC market research continues to point to Cabometyx remaining the Asian of choice in the second line setting after any ICI combination primarily due to the fact that it's the only teekay.
With a strong Pos benefit per the label in the second line population.
In fact this support was reinforced at the recent Jiu Jitsu ASCO meeting from care wells in meetings as well as from the podium.
We are pleased to see this continue to play out in the marketplace as Cabometyx new patient market share in second line RCC is increasing and Cabometyx continues to capture the majority of patients who progress on first line IC combinations.
Furthermore, cabometyx continues to be the number would prescribe teekay.
In RCC based on the acuity prescription data.
Year over year for Q4, Cabometyx Trx volume was up 11%.
In Q4 over Q3, Trx volume was stable.
Cabometyx outperform the other teekay monotherapy suit nimbo treatment in Q4.
Turning to HCC.
We expect the combination of the test realism, and Bevacizumab, we'll get approval in first line HCC.
Subsequently the HCC landscape will likely evolve in a similar fashion to what we saw in the RCC market with ISI combination therapy moving to the truck line, which could be an important new standard of care for untreated liver cancer patients and serve to expand the first one market.
We anticipate this will in turn increased Teekay monotherapy utilization in the second line setting as second line ISI monotherapy use decreases over time.
We strongly believe that many more eligible patients could benefit from cabometyx.
Cabometyx remains the number one prescribed teekay in RCC and we look forward to building on this momentum in RCC HCC and other potential future indications such as prostate and long as the Cabozantinib development program expands and progresses.
Future growth for Cabo in RCC, HCC and beyond may be driven by the outcome of our trials evaluating cabo in combination with immune checkpoint inhibitors, including Checkmate 90, our which will be the first of these phase three Cabo ICI combination studies to read out.
As Mike highlighted the Exelixis team had a significant presence at ASCO, GPU, which took place two weeks ago.
In addition to positive support for Cabo and RCC.
In prostate cancer care wells few Cabo in combination with the Tesla is a map with optimism.
This regimen has the potential to address the significant unmet medical need in the early MCR Pcs setting and appears to have the potential to be well differentiated. According to many key opinion leaders that we heard from at an advisory board and numerous other meetings achieve Glasgow.
Our team remains highly focused and motivated to compete everyday to bring the benefit of cabometyx to all eligible patients as we continue to build the franchise and maximize its clinical and commercial potential.
With that I will turn the call over to Gisela.
Thank you Peter I'm happy to provide a brief update on our development and regulatory progress in the content.
I'll start with our current phase three program focused on team as a single agent or in combination with immune checkpoint inhibitors.
Which includes 12 ongoing or planned potentially label, enabling late stage steady.
Including company as well as industry partner and Cetip sponsored study.
Chris did most advanced is checkmate non yacht the phase three trial, comparing cabozantinib assess the volume up with Sunitinib in first line RCC in all I am DC of risk groups.
The steady completed enrollment earlier in 2019 and as previously reported and looking forward to result in the first half of this year.
Hey, John keep comparing with the BMS team, our clinical development partner, we're executing the steady to enable expeditious future regulatory filings once topline results are available and if warranted by the data.
At the recent ESCO Ci High conference in mid January beyond our development partner Dms reported encouraging results in HPC from the phase one cohort of checkmate tearfully hero of Cabozantinib in combination with new volume up plus minus any moment.
The 71 patient steady in first line and second line HCC patients yield decreased response rate of 19 and 29% for the two plant in triplet combination respectively.
The disease control rate to a 75% for the duplex and 83% for the to pick combination.
And importantly, encouraging overall survival data for reported with media known ways of 21.5 month.
Not reached before the duplex and triplet combinations respectively.
The combination showed an acceptable safety profile with no unexpected safety signals of Sir.
We believe that these data in a mixed population of first and second line HCC patients and bodes well for the combination of Copas antonym with checkpoint inhibitors in this disease.
Three additional pivotal phase three studies have been initiated in the past year, so, including importantly combinations with checkpoint inhibitors.
Such as in the Cosmic 312 trial in first line HCC with Eculizumab and the Cosmic Iffy 13 trial in first line RCC with new volume up any moment.
And also the single agent comes down to it could sneak 311 trial and differentiate thyroid cancer.
These studies and making excellent progress and actively enrolling patients globally.
As we have guided we anticipate topline results from both cosmic 311 and dependent on the events also cosmic 312 as early as during the second half of this year.
And I'm happy to important to embed the accrete that milestone of enrolling 100 patients cosmic 311 steady and DTC.
And data from this population will support the analysis of the co primary endpoints objective response rate of all our once all patients have been followed for a minimum of six months.
So the broad ongoing cabozantinib late stage development programs really making great progress and we and working on Fernandes phase three concepts and notes peak two dose of plants in a minute.
First I'd like to focus on the cosmic owed to one trial a phase on B study of comes on to NIM entities, who leads in the.
Continues to make excellent progress.
In the steady has been accruing patients actively with more than 550 patients enrolled by year end 2019 across 24 expansion cohort.
And we are seeing encouraging early results in different tumor types incenting.
As we reminded the key objective of the expansion cohorts is objective response rate per resist version 1.1.
Notably early data from the M.C. RPC corporate six has resulted in expansion of this cohort to a total of 130 patients.
And at the recent to ask continue conference we shifted results for the first 44 patients enrolled in this cohorts with the first time.
This MCR PC cohort enrolled patients with measurable disease purposes version 1.1, who had progressed and try at novel or mall therapy could if received prior to Texas, Oklahoma insensitive disease.
44 patients were included in this interim analysis.
Median follow up with 12.6 months.
The objective response rate curve resist the trials primary endpoint with 32%, including two complete responses and 12 partial responses.
Disease control rate with 80%.
Median duration of response fall responding patients with 8.3 months.
Among 12 patients who had an objective response in at least one postpaid snine prostate specific antigen evaluation, 67% had a piece a decline of at least 50%.
And importantly, the combination of Motavizumab income was antonym showed an acceptable safety profile with no unexpected safety signals.
Based on Ft, a feedback we plan to pursue an accelerated approval process, if warranted, but the data from the expanded cohorts fixed.
And from additional cohorts and the company go to one trial evaluating single agent activity of companies onto Nick and aggressively tumor.
Also we had announced previously that we are expanding the cohort of patients with checkpoint inhibitor pretreated non small cell lung cancer patients based on initial encouraging safety and anti tumor activity.
And this Mike highlighted during our presentation at JP Morgan in January we look forward to presenting data from this and other cohorts from constant go to one at various medical meetings over the course of this year.
Among other data these observations from cosmic onto one has led to a 50 50 co development agreement with Roche announced late in 2019.
Two phase three evaluation of the combination of Cabozantinib and these lease a month in three initial phase three study in metastatic CNPC non small cell lung cancer and renal cell cancer.
And we will provide more details on these trials and the are being initiated.
And lastly on the regulatory side, our partner and Japan, and Takeda completed in India filing with the Japanese regulatory authority, we presented for the treatment of patients with previously treated HCC and January Twentytwenty and we also look forward to update.
On the regulatory progress on the application filed in April 2019 for Cabozantinib in advanced RCC.
And with that I will turn the call back to Mike.
Hey, Thanks, Gisela as I said in the interim.
Off to a strong start in 2020, and we expect a data rich year as we advance cabo towards new potential indications in additional compounds into the clinic, we expect to continue to present new data throughout the year no look forward to building on the momentum from ESCO G. III in GPU as we continue to eliminate our path.
Two additional indications for combo emerging data for XL or nine two new drugs entering the clinic and new assets from our business development activities.
I'll close by thanking everyone at Exelixis for their consistent focus in superbowl leadership as we navigate the opportunities and challenges that will encounter in 2020.
The entire team is committed to making every day count as we discovered develop and commercialize the next generation of our medicines for cancer patients in need of better and more effective therapies. We look forward to update you on our progress. Thank you for your continued support and interest in Exelixis and we're happy to now open the call for questions.
Thank you, ladies and gentlemen, as a reminder, you will need to press Star then one on your telephone.
To withdraw your question first about Keith.
Again install I want to ask your question.
Please standby, while we compile the culinary roster.
Your first question comes from the line up.
As speaker on warning with Suntrust. Your line is open.
My question.
And I want to say congratulations for the progress made this year.
Being having a lot of fund keeping track of fold updates.
A few questions if I caught on.
On the prostate cancer setting.
So, yes, okay, well checks to talk.
Increasingly talk about synergy I'm curious that at ASCO Gi and that's an adequate to you when you're running our AD boards. If you got.
Dr talking about Sungy almost on prompted is this something that the reading out of the data.
Also I noticed that interview with talk to accrual you mentioned something about 70 patients already being enrolled and cohorts six.
And planning on a the next analysis for 100 patients.
Im guessing to suggest maybe a second half 2020 update on cohorts six or am I being too ambitious think that make something midway between 20 as possible and they have one will follow up afterwards.
Yes. This is schemes and then thank you for the question.
I'll take them in turn regarding your question around synergy.
Certainly and the feedback with occurred at ASHG tooling, the prostate cancer data was presented the SEC.
People were impressed with the response rate per reduced 32%.
And keeping in mind that single agent.
Response rate discovers Anjaneya no single digits and.
Seasonally zuma, the night and very few and far between.
Q2 to 2% stood out to people and they saw a co-operative activity potential here.
Now with respect to as the next day to update we'll certainly update you actually.
Received confirmation of presentation today medical meetings and.
Because even at that for the time being said I think we're very pleased with the active accrual in the phase when be steady across the board in particular onsite therapies.
Great and then.
A question for Chris here.
Chris and Mike how much more for Salesforce Bill would you need for promoting Cabo and the prostate cancer setting I'm wondering, especially since you need me I mean and reps into urologist office, what kind of.
What kind of build out could we expect in our models.
Yeah, Hey, it's it's Mike that's a that's a great question, it's a little bit early.
To be opining upon that right now obviously, we have a pretty pretty strong presence in the in the G. you space and very strong commercial team across.
All components of that for the business relative to being able to detail.
On a label to the appropriate customers and then follow up with the appropriate support from the rest of the commercial organization. So how that morphs going forward. We have a full full contingent of commercial people right now and I would I would think about that as an incremental build but we'll go into a pretty detailed analysis. So when do we.
We hold off a little bit.
And really speak to that once we have more definitive data and timelines around filings and those kinds of things. So we can put that in the proper context.
Great. Thanks for taking my question guys you bet. Thank you our thank you.
Thank you. Our next question comes from the line of Andy Steve with William Blair. Your line is open.
Great. Thanks for taking my question so.
Congratulations on the progress and very compelling prostate cancer data.
Especially.
Such.
Such challenging field for Io agents, so I'm, just kind of thinking about the landscape here.
Do you think there is no positioning headwind for the Cobley Tesla combo as double hormone therapy is kind of move into cash rate sensitive or non metastatic slash undetectable settings.
But this husky lacking and start did the response and at this can chime in of course.
So as you said.
Prostate cancer landscape is certainly a changing with more compounds.
Approved now Andy Harman sensitive stage.
And that's something that is of interest to force for our combination.
We have.
Collected today to know and patients who have received at least one novel hormonal Agented could have pretty from one in that in addition to.
Potentially having received just to check so for the farmland sensitive Tc. So it's a relatively earlier population compared to what we've studied and use that.
And with that we've seen really quite encouraging safety data and tolerability of to combination and smell is of course, the response rate and durable response rate just described earlier.
Okay. So so really just had a glut just another question on the.
Trial design suffered for cosmic three one to.
I think in you know recently the number of patients were increased by 102 740.
And the kind of given that it's a three arm trial. The distribution also was altered a little bit used to be 63 to one now it's two to one in one so.
Taking everything together I mean, obviously the biggest changes really to single agent. Cabo now has 185 patients versus 64. So maybe do you mind sharing with us the kind of the rationale behind the change.
Absolutely.
Thanks for the question does this cost mix. We went to steady is of course, the HCC Firstline steady. This compares cut the continent, plus a teaser link them up versus some rough and intensive primary endpoint.
Driving.
Yes, and Pearson analyses.
In addition, we have included a single agent couple of dungeon upon really to address the contribution of components to the activity observed.
The combination and so in order to strengthen that.
Evaluation, we have some love that not here.
When it's in the early part of last year in on the sample size.
As you described and increased the sample size in digital.
The single agent overtime to nearby.
Okay, and lastly, I'm, so happy ask or do you. The designed for a contact three was disclosed there are no intention or not.
So so to two partners or if you don't mind. So what is if you look at the low to one study the second line RCC for the combination of Cabo and it has always narrative formerly tested so just curious about why you chose the second line setting and.
Perhaps you can opine on I think.
Dr saying at Duke.
Shared her experience in kind of positioning in the second line that she she said you know for fast Progressors on I O or IOER Io Teekay ice you might consider something different which is monotherapy teekay <unk>.
And then for slow progress or she might continue on and maybe.
Do something like a context three regimen at Tesoro Cabo. So curious if you can kind of.
The question.
We haven't announced initiation of the phase three program that is team conducted under 50 50 collaboration with Roche and then extends across three phase three studies and no as you mentioned at ASCO to you on the podium and discuss in June the oral RCC.
Session.
Showed a trial design.
That.
Into Valuating Kabul, the backbone versus book.
That is the reason mob and.
Previously treated checkpoint inhibitor pretreated patients.
And as you say.
Just a new study into highlighted and sentences labeled can take three so we would expect of course to go into much more detail.
The study is actually being initiated.
Just a few things to mention first I think it's very gratifying to see cabozantinib as the backbone now and the standard of care to be evaluated in randomized sitting Cindy.
Second line.
Treatments space.
So that is one point I wanted to make the other is of course match in patients with who had been previously treated with checkpoint inhibitor and Steve now.
Not showing the data is he edge, but taken the decision to expand the non small cell lung cancer cohort.
And of course, it was based on encouraging activity and its safety observations and look forward to sharing goes.
And then lastly, also and other settings that upper described earlier in the call.
TNC RPC 15 nice.
Corporate if activity.
That checkpoint inhibitor plus I'm confident in it so.
Another three cents to evaluate this particular sitting where there is really at the current time only single arm data available.
Combinations in smaller studies.
And regarding the preferences to us as the investigated TN sung.
From Duke.
With regard to cause Progressive Inc.
Page patients with rapidly progressing Dcs benefit from.
Rapid onset of.
Of clinical benefit and as we've certainly seen that with compass on generics and in this disease and in other diseases.
Okay, great. Thanks for.
Answering all my questions really appreciate it.
Great any thank you.
Thank you. Our next question comes from the line of Michael Schmidt with Guggenheim. Your line is open.
Hi, guys. Thanks for taking my questions and congrats on the progress I had one regarding cost may go to Juan.
Regarding the the potential opportunity in non small cell lung cancer I was just wondering how much thinking about a potential.
The registration here I think as part of the.
Operationally.
You mentioned a phase three trial I was wondering if this occasion.
That's.
So.
Pathways.
John.
Yes.
Yes, thanks for the question I think.
Clearly, we are seeing activity and non small cell lung cancer and checkpoint inhibitor and pretreated.
Non small cell lung cancer patients.
Therefore, we are pursuing Pos and mention with expanded this cohort to 80 patients. We look forward of course, the more in depth affiliation and new product patient population now.
And the.
Data, thus far we hope to present tune and the year have.
Provided the springboard if you will to design a phase three study and we'll talk about the details of that study in much more detail when time comes in the initiating the trial and collaboration.
Okay. Thank you and then regarding caution Mike.
Hi.
Yeah.
Just wondering how.
How you think about the potential opportunity here.
Okay.
Setting maybe relative to.
Some of these connecting rented and put us in our be okay.
Yeah, Michael It's Mike, maybe a maybe PJ could could address that well first yeah, hi, Mycosis PJ I think we think about second one plus DTC, we've said and make sure to JP Morgan about 4000 patients in that setting.
The ret inhibitors are primarily being studied in the in the measure it direct space.
Certainly with regards to our history of come metric.
And Backgrounder Exelixis I think thyroid is space that we know well and we know the customers on for many many years now so it's certainly a.
The market we would be.
Very excited to have the opportunity to.
To commercialize in should everything play out appropriately.
And I think one that could give us a lot of synergy given our current team.
And experiences with the company.
Great and then maybe just a housekeeping question.
The the gross to net adjustment in the fourth quarter.
Chris could you share that with us how do you think about that.
20 Twond.
Yes, Michael Thanks, It's Chris.
So yes during the course of their year end financial audit.
It was determined that we had an accrued enough as we model about our chargebacks and so that was all related to trade inventory. So.
So we increased the accrual accordingly.
Looking.
On a go forward basis, we're looking we had we had gross debt around 23% in the fourth quarter and for 2020 were looking for gross to net and that 23% to 24% range.
Thank you.
Thanks, Michael.
Thank you next comp call come from a lot of Jason Gerberry with Bank of America. Your line is often.
Hi, good evening, Thanks, taking my question.
First one for me just on prostate I'm curious your discussions with the agency as we think about upcoming Readouts for Io chemo.
The ability of those types of combinations to leverage and accelerated review mechanism or was the relative toxicity profile of Io Teekay Guy and important factor and enable being able to potentially leveraged an accelerated review mechanism.
Sure.
So, but I can't really speak to the specific discussions with the FDA I think.
As I mentioned, a little bit earlier, but we're pursuing in terms of the development Pos it's really.
Potential accelerated approval pathway based upon a response rate and durable responses observed for the combination.
In TRP as it has been seen in the cool it takes a evaluation that you've just seen it as could do you think the other.
Consideration of course that has been discussed quite a bit and the era of combining therapies.
Testing and the contribution of components in that.
Of course, looking at both efficacy as well its safety.
And so in order to everything.
Proper evaluation of the risk benefit profile.
The need for the other compound if you will the combination so.
That is certainly an important aspect as Weve also built into our development program actually is designed the on 200 steady to not only evaluate the combination of fifth component is the reason up income was engineer, but also single agent evaluation of each agent and though.
To address that particular question.
Got it and and this is a follow up can you comment.
As it pertains to the.
It has a combo studies in long, what you think as sort of a meaningful threshold for efficacy here I think we've heard from some other competitors in this post IPO setting something in a low mid 20% or our arrange durable hundred plus patients just trying to get a sense of.
In terms of what we should be looking for and then.
This is a modeling question as you think about the potential approval and launch of the I'm Brave 150 regimen in frontline liver cancer.
How long you think before the second line market kind of opens up to Teekay our monotherapy. Thanks.
Yes, Hey, Jason It's Mike I'll take the first question and then pass the past that Mike over to PJ for the Embraer question. We got that question. The general question a lot in the run up to ask a g. with prostate and it's as you would imagine a bit challenging to provide any kind of quantitative guidance on where the.
Bar is relative to.
Expectations from others, and what we see in this space relative to.
Other other therapies as well so.
We're excited about the data that we've got so far in the first 30 patients. We're we're expanding aggressively here, including looking at single agent combo in that single agent cohorts. You know two one again as we as we get more data and that and it matures, we will present the data and the new can be the judge for yourself and others in terms of.
That kind of meet the expectations and pass the bar, none, but it's just it's hard for us to do that right now before the fact is kind of show our cards right as you Im sure you can imagine.
In regard to embrace of in the second line TJ you want to take them Yeah sure. Jason. Thanks for the question. So as a as I mentioned, we certainly expect it says about to be approved in first line HCC.
And really move the standard of care forward there with the doublet.
I see I sort of anti Angiogenic combination.
And potentially bring more first line patients into that.
Systemic treatment landscape of HCC as far as the timing.
When it gets approved obviously that's up to the FDA one would expect it to be relatively soon and then those patients would have to receive that combination.
And progress so thats, obviously, it's difficult to forecast all about specifically I think generally speaking HCC.
It's a bit of sicker population in RCC, so on the might expected to occur.
A little more quickly than RCC, but we're really have to wait and see there.
But.
About half the second line market is currently Ipi monotherapy. So we do expect that chica monotherapy would expand into that that portion of the marketplace.
Great. Thank you.
Thank you.
Our next question comes from the line of self in Turkey with Oppenheimer. Your line is open.
Hi, Congrats on a year and congrats on all that data and prostate cancer, a very cool great I just want to switch gears too little too RCC.
Have you seen or how have you seen the choice of therapy post to Teekay IP Teekay, a PD, one combo or PD one CLA for evolving do you think about you know that there's some more chance to eke out more volume and upsetting and second of all you know scripts have been slowing down a little bit because.
I think we discussed earlier that patients were held up by the longer.
That's in front line like is there any views on when you think this could maybe reverse.
Yeah. Thanks for the question solving this is PJ.
You know.
What we've seen in second line.
Post IC I combo is certainly all the market research indicates that.
Cabometyx does and should continue to get the.
The majority of those patients in that setting and we're really seeing you know a market share there in the.
Approximately mid sixties range in that post IC.
Combination second line setting for Cabo, which we're very pleased with.
I think you know beyond that.
What are kind of reference in the prepared remarks is that we've seen the first line setting stabilize we've seen the the cabo market share stabilize in the.
The sort of high single digits. So as those patients are flowing through and we see more flowing through week, we would anticipate continuing to get the majority of those patients in that setting and.
What we've seen there is our market share increasing in the second one setting overall and it's now sort of in that mid Thirtys range.
So as gifts Willis said June 2nd line Cabos really the.
The standard of care for clinical trials and.
And the market share a strong there with potential to continue to grow volume I think is as more of those patients flow through from the first line setting.
Into that into the second line post IC I combo, setting where as I mentioned, our market shares in the mid Sixty's.
Great. Thanks, and one more question for me to Mike.
Maybe just a big picture thinking.
When is it like that going generic and what do you think will be the impact on all the RCC landscape a generic in lighter and HM are you on track to potentially compensate topline changes to your topline. What's your four new applications by year end 2021 are you comfortable with with that speed.
So the in light of.
Timeline for low we is.
Isn't completely clear based upon.
Both their composition of matter as well as polymorph patent so I don't I don't want to speak to that per say relative to those timelines.
What I will say is that right now its label is focused exclusively on RCC and obviously the big goal for us outside of what's happening in RCC is to expand into other indications like prostate like first line liver like one et cetera, right. So so again, our our focus is to expand indications for combo in terms of.
Either single agent or combinations to build the franchise really in reinforced existing franchise that we've got in renal liver retired and certainly that is a is our main focus as we go forward.
Well, great because from Washington, Congrats again.
Okay. Thank you.
Thank you next question comes on the line of Kennen Mackay with RBC capital markets. Your line is open.
Hey, Thanks for taking my question, maybe for Mike I was wondering if you could help us understand the decision to give that odds are raising 2025 guidance a little earlier this year through what drove that especially that are given that some of the 2020 got textbooks.
Quite conservative and within that guidance it looks like a the team have seen potential for tableau to grow to 1.1 billion in sales in front line RCC, that's obviously dependent on the trusted RDR data.
But wanted to just get a sense from you and the team what needs to be seen Jim that data in order to realize spectrographs. Thank you.
Yes, So let me, let me backtrack to where we were in the at the end of last year and how we framed.
JP Morgan in the beginning of 2020.
It will be the majority of 29 team and a lot of 2018, there's been a clear myopic focus.
Around two topics both in terms of the buy side and the sell side around.
Around around the Exelixis story and that focuses every Friday on IMS scripts, and then you know a plethora of questions consistently around 90 arc, which we thought ending last year really was it was it was a good time to reorient.
People around the Exelixis story and the.
Proverbial billing focus on the forest and not a couple of trees as as our business has evolved really so dramatically over the last year or so in terms of all the work in progress that giesler talked about today in previously what you've seen at both ESCO Jee Hyun SPG EU. So the the again the goals that we outlined.
For for 2020, and 2021 12 label, enabling trial is enrolling six readouts in 2020.
Potentially for new indications I think speaks to that the 2025 number that we put out there and the math that we showed which supported that is really our attempt to show what success could look like it's not a DCF, it's not a full lasagna chart of the ramp over those revenues but.
But it really provides I think very clear picture, both the buy side and maybe especially the sell side for what the depth and breadth of our portfolio and efforts around cobble could look like if we're successful so it was a clear.
Signal that we're more than just nine yara were more than just weekly scripts and we have very ambitious plan and program to be able to maximize the value of combo for patients and for our shareholders.
And then in regard to your question about about front line RCC I'd remind you that the math that we showed on that slide at JP Morgan covered the complete frontline setting so single agent Cabo from Cabo Sun and then the doubling from 90 are as well as potential triplet.
Success in revenues from from Cosmic FY 13, so thats a a consolidation of Threed difference. If you will sub streams of revenues coming in in the frontline setting, but we think thats, a I think thats a reasonable number for what success could look like there if those trials provide competitive data.
Dr. Another that's helpful. Maybe.
Just to extend a little bit on.
For the potential successor objected Mariner are coming out of Oscar Jewett slates knew that noted are sort of two ways too.
Potentially working more competitive more efficacious than some of the Merck got obviously hitting on overall survival would be a massive women in one way to do it in other words, potentially having sort of a or better CR rate. That's obviously what is driving the use of the nivo in the front lawn, despite having a survival hazard ratio.
Thats lower than actually Pembro was wondering.
Yes that thinking.
Sure by the team or if.
It was something I'm missing, but so much.
Yeah, I think is probably a statement or the obvious that survival data from 90, our would be a good thing to house.
Since we're competing with us with somebody that has that data in their label.
The certainly we've seen the success of our ability to.
Make Cabo a second line standard of care by having survival in our label for media. So we we understand that we acknowledged that we embrace that and I think we've been working with them with our partners right to be able to maximize the chance that happening and then it's an experiment.
That's running and we'll see and you know I don't want to get ahead of that but obviously, that's a very important component for us to generate competitive data.
Beyond that we've done a lot of market research.
Yes, I think a lot of very important questions around how.
Different components, but data readout could provide additional benefits and additional momentum from marketing point of view, there's many different levers there that we could pull but again to elaborate on that now beyond.
The obvious probably have a bit of a stretch. So we'll get the data will talk about the data and then obviously I think we've got the team and the broad collaborations in place to be able to take the momentum that we've got from single agent combo in single agent.
Nivo in the case, both compounds have been use as standard of care in the second line setting for years and that name recognition could really drive I think with the appropriate level of data a very strong commercial approach.
Thanks for taking the questions from the follow up that hey, Thanks, Ken.
Thank you.
Our next question comes from the line of Yajuan Weber with Cowen Your line is open.
Good evening.
Congrats on the quarter. Thanks for taking our question. This is a little light and for your own rubber just to piggyback on the good question earlier.
He seems to me that some of those additions coming out the agriculture do you still prefer to use nivo Pete just because of the long term data the presented.
I'm just trying to understand how does could potentially affect the.
Ongoing competitive landscaping RCC what.
Now you are needs to show in terms of beating the if you will you be or the idle Chicago combo also another question is on the a.
MCR PC acute do you have a threshold incomes of give a do it for that to you want to beat for the.
At the fat Holly Thank you.
Thank you why don't we have PJ answer the first part of that question and then Gisela can talk about the see RPC question. So pges yeah. Thanks for the question.
You know.
Nivo hippies, Ben approved and on the market now for going on on two years and they did as you mentioned have sort of updated data at ASCO Gi you from the other two one for trial I think.
That market as a kind of measured in in the prepared remarks with regards to the first line has really stabilized we're seeing sort of.
Nivo it be and then Pemex here the IC accommodations at about 70% to 75% give or take of the first line market. So I think.
As I mentioned Cabo is in the high single digit Serbo what we're seeing and we would anticipate to continue as more and more of those patients.
Sort of progressing into second line setting where cabo.
Gets the vast majority of those patients I think thats an opportunity for us there.
With regards to first line setting I think as Mike said, we'll have to see the data Theres certainly reason for optimism and.
I think.
With Cabos track record and history in RCC.
Lots of opportunities for us to compete but we'll certainly wait to see the data to figure out how to best do that yes, maybe I can just add that obviously, we're talking about 90 are right now, but you know 313 is really designed to go head to head with the triplet cargo nivo it'd be versus Nivo it'd be too. So so we have a second to a second shot here that.
Enrolling very quickly we're really excited about generating a lot of newsy has globally for that trial. So so we are again, we're very committed to advancing opportunities and potential standard of care.
For RCC and we've got a great great compound in the mix based upon all the single agent data and as we get more combination data will be able to move accordingly.
So this was tableau across their sure I'm so in the M.C. RPC setting.
In patients who were previously treated like described in our patient population.
The durability of response than we've seen with 8.3 months and that in response rate of 32% is certainly very encouraging that against the backdrop, let you see an estimated.
Durability.
Benefit.
And then maybe a PC a decrease with stabilization.
More so than actual response in with the tickets in HD for example.
List data center that we have generated thus far and it's very encouraging with respect to durability of response.
Very helpful. Thank you.
Okay. Thanks Leo.
Thank you.
Our next question comes from the on the Stephen Willey Stifel. Your line is open.
Yeah, Thanks for taking my questions.
I guess, one first just on lung cancer.
I know that Theres other.
Hi, guys competitive strategy is out there looking at Teekay is an Io and.
I think some of the companion Teekay guys have.
Okay.
Somewhat of an overlap in terms of over the kinase profile as Cabo I guess, specifically with targets like axle and by Jeff and too.
Just kind of curious as to how you think cabo kind of differentiates from some of those other TJ guys that are currently being evaluated in some of those later stage studies in the post IPO setting.
Yes, Peter I'll take a crack to that.
You just generally when I'm talking on a generally don't necessarily lung specifically.
So to speak it's really the totality of the capital management profile that we think makes it particularly attractive Io combination.
So its inclusion of Matt.
You mentioned the actual we all the time family members of the vegetables component.
Okay, and kind of plays into its ability to kind of promoting immune permissive environment and that's both from.
Got to immune so a point of view as well as I think I think this was quite important from the effects of there hasn't been a variety of innate immune cell populations.
If you add back to the fact that has.
You know direct effects on the tumor so including the ability to induce humans. So I suppose in many savings, which then presents a little more entered into the immune system.
It's really that kind of totality with thing I'm I'm, just unaware of any data is that really doesn't direct comparison between some of the teekay LNG will begin.
I was asking them.
The overall profile is differentiating.
Okay, that's fair.
And then just a quick question on on 90 are I guess is.
Should we expect that the Splm Bristol filed for Q4, W. dosing of Nivo would apply to the Miami our regimen.
Yeah, I think and then it's really a question that you should ask Jim crystallized at least on what to speculate on there.
Regulatory strategies of course.
Okay, and then maybe just one quick follow up I know.
And I might have missed this if this has already discussed.
Excuse me, but.
I can help I noticed I guess when you talk about.
Longer term growth being driven by feature indications when you talk about prostate as both front in second line.
Just kind of curious where that from on part of the equation comes into play if you can provide any color on that thanks.
Yes, Steve It's Mike just again, just just to frame it from the standpoint of.
NH teas are moving up in in their line, whether it be they be hormones sensitive and door and zero population based upon the plethora data that's come on over the last the last few years, so again a.
Maybe a matter of semantics first line second line relative to.
Castration sensitive versus versus castration resistance.
Think about it as as post post the first NHP I think thats, probably the way to look at it whereas the the lines first line second line for the want gets complicated when you're looking.
Across different levels of hormonal sensitivity.
Got it alright, thanks for taking the questions and congrats on all the progress.
You bet Thanks, Steve.
Thank you.
Next question comes from a lot of George Farmer with BMO capital markets. Your line is open.
Hi, Thanks for taking my questions.
Okay and more about the.
Prostate cancer presentation.
Could you elaborate as to whether you saw any responses in bone lesions at all in this trial.
Yes, and yes focus to trial of course on resist responses in the elsewhere completion.
And to include in the trial to satisfy their need or eligibility with measurable disease being present, a and inclusion and so.
That said there is a key focus of to study and with that focusing on.
The soft tissue lesions or there could be lesions that are in association with tissue, an associate and she is still station gives me.
With bone.
And of course this round metastasis, so that that is a key focus on this study.
So looking of course at Mponeng metastasis season here in particular.
In fact bone scan, we would be looking act progression in bone rather than response in bond and those responders that we've described that's not progressing bond issuance for instance.
So George to again as we talked about previously the whole the whole focus here was to take the learnings from the comments.
And then apply apply them several years later.
Ask a simpler set of questions that we could get very clear clinical insight into without going into.
More controversial if you will read outs and certainly the bone scan.
Response, Readouts back back in the day 2012 2013.
While very interesting had had we had improve in any correlation in terms of clinical benefits right. So so that we took a step back here and instead of trying to ask.
The big question across the entire population to really focus the effort around something that we could use resist 1.1 in terms of both enrollment and response assessments that would give us a clean noncontroversial answer and I think the data and I think some of the momentum we got from ask of GE when all the excitement there is.
Because largely because that was a very simple standard read out in terms of response assessment.
Okay, and then regarding the strategy for accelerated approval I I believe F.D.A. has has also focused on progression free survival as as an important surrogate.
You talked a lot about duration of response, which is different what sort of hurdle do you think you need to show for progression free survival in this study.
If any or is deo are going to be sufficient do you think [laughter].
So in terms of progression free survival really in order to evaluate the properly when needs and randomized approach.
And then it's usually done in a randomized phase two phase three and tech setting.
When we talking about the potential.
Flora and accelerated approval pathways and you're looking at who response rate incur ability of those responses.
In a single arm study such as and in doing that with the coupon six.
Okay, great. Thanks very much.
Okay. Thanks George.
Thank you next question comes from a line of Paul Choi with Goldman Sachs. Your line is open.
Hi, Thank you and good afternoon, everyone. I also about question on prostate and maybe if you could help us I'm thinking about where.
Where in the.
Benchmarks that you think that the combination could result in terms of of PFS any sort of baseline expectations or historical compared or do you with reference to particularly given.
With that nets prior history as a monotherapy if you could maybe just sort of frame the landscape there that would be helpful. For us and then I had a follow up question on his depth.
So right now as I said, just a immunity to grow we're looking at the response rate and durability of response, I think and the our successful in a potential accelerated approval Pos of course, they are planning on conducting a phase three evaluation.
And we'll talk about the details into assumptions around that when the time Thompson the ready to do so when they're ready to initiate the steady.
But I think when you're talking about when you're talking about progression free survival.
Again that would be an evaluation that is much stronger and a randomized testing such as phase three study.
Okay. Thanks for that and then as a follow up will be sitting on a pretty nice.
Cash file at year end based on your guidance.
Could you maybe speak to you to how you think about uses of cash.
In terms of business development, I guess, depending on what Youre clinical successes over there that the next couple of quarters in terms of your your major read outs that are coming up here. Thank you.
Yes, so a pulse Mike.
Obviously, we have a lot of a lot going on with combo right now and a lot of confidence both in the progress and the opportunity that is there.
Beyond that we'd like to build you know again state the obvious write a diversified portfolio of of drugs that can help more patients across a multitude of both modalities as well as pathways and target. So so we've got a lot going on in discovery right now as you as you saw you know kind of some of the.
The year.
The press release that began the year, we've got target to have up to three new I NDS. This year from both internal and collaborative sources, we're doing a lot of work right now across the board looking at a variety of additional collaborations and or assets and or companies that we would like to understand if.
If we can.
The scenario, where we move forward with those transactions do they do they build value and where's the risk involved where's the where's the upside how do we how do we build conviction around the science around the clinical program and around the commercial opportunity and I think that latter one is probably the most important from the standpoint, when you see a variety of.
Front transactions over the last few years as well as just the the challenge of launching drugs in this space with the with arguably good data in an approval can be can be somewhat owner or so so look we have a lot of success across the board and we're looking to build the company that is based upon a diversified offer.
In both from internal as well as external sources. So that will continue but the focus is doing the right deal for the right assets at the right time for the right price and I think we're.
Intrinsically we have that discipline in place to make sure that.
You know we're doing the right.
The right work in spending the right amount of money to get the assets that we really believe can move the needle for us and for patients in the future.
Yes.
Thanks, and congrats on all the progress.
Thank you.
Thank you.
Next question comes from the line of Jeff Hong with Morgan Stanley. Your line is open.
Thanks for taking the questions you've talked about how the HCC market, what's where RCC was years ago and that you'd have to help build out that market.
And then the next few weeks cobble will have been approved for a year in second line HCC. So can you comment on how far you think you've come up on building out that market for Cabo in second line HCC and what additional work needs to be done.
Yeah. This is a PJ thanks for the question Jeff.
We're certainly pleased with the progress we've made mid are as you mentioned proximate approximately a year on.
On the market. We are the we're the number one teekay I in sort of our are setting in the second line.
Plus space, which is encouraging I think what we've always said about the market being built is.
It would take not only us, but a variety of different.
Potential combinations moving upfront and as I mentioned I think the tens of that is going to be really the first catalysts, there that could bring more patients into that sort of treatment formal so to speak in the medical oncology setting in the first line. So I think.
We're on the cost both potential more change there similar to RCC and then certainly I'm excited about.
About our study three one too as we look forward in HCC landscape, so more to come there.
Great. Thanks, and then can you talk about Zillow nine two and remind us how it's different from Cabo and any specific properties you'd highlight that you think maybe advantageous over cabo. Thanks.
Yeah, I'll be happy to take that question again, we Havent haven't said a lot about the pharmacology of that molecule and the.
The design considerations that went into that previously certainly plan to talk about that this year.
And at that at least one.
Medical meeting in the future sometime this year so stay tuned on that once we know once we get that that slot. We'll talk about when that is where that is and then we'll be certainly happy to share both the thinking behind that and the work that went into helping us understand the value that this next gen capital can bring.
Thanks.
Thank you.
I'm showing no further questions at this time, that's all I like to turn the call over to your host for today, Susan Hubbard Robert.
Thank you Twond and thank you all for joining US today, we certainly welcome your follow up calls with any additional questions. You may have that where we are we were unable to address during today's call.
Ladies and gentlemen. This concludes today's conference. Thank you for participating you may now disconnect everyone have a wants to put Oh.
[music].