Q4 2019 Earnings Call

Good afternoon, ladies and gentlemen, and welcome to the Acceleron fourth quarter and full year 2019 earnings conference call.

At this time, all participants are gonna listen only mode.

Later, we'll conduct a question and answer session and instructions will be given at that time.

As a reminder, this conference call is being recorded I.

I would now like to hand, the call over to Mr., Todd James Senior Vice President Corporate Affairs, and Investor Relations at Accelerant. Please go ahead.

Thanks, and welcome everyone to our fourth quarter and full year 2019 earnings call. The press release reporting our financial results. In addition to the presentation for today's webcast are available on that investors and media page.

Of our corporate website at Www Dot Acceleron pharma dot com joining on on the call. This afternoon, RMB doubling our Chief Executive Officer, Kevin Mclaughlin, Our Chief Financial Officer, Dr., Jay Backstrom, our head of research and development and Suji can go our chief commercial officer.

As a reminder, we'll be making forward looking statements regarding our financial outlook. In addition to regulatory product development and commercialization plans and research activities.

These statements are subject to risks and uncertainties that may cause actual results to matured differ from those forecasted a description of these risks can be found in our most recent form 10-K on file with the FCC with that I would now like to turn the call over to it'd be probably our CEO.

Great. Thank you Todd good afternoon, everyone and thank you for joining us today.

Certainly has been a busy time acceleron since our third quarter earnings call at the beginning of November shortly after that call Acceleron and our collaboration partner Bristol Myers Squibb announced the U.S. FTC approval of rebels, though for the treatment of anemia in adult patients with beta thalassemia, who require regular red blood cell transfusions.

Rubblization also known as Luspatercept is the first Acceleron discovered medicine in the first ever Threed maturation agent to received FDA approval.

We have deployed a 20 person commercial team under the leadership of our Chief Commercial Officer CJ can go to complement Bristol's hematology and oncology commercial footprint.

Our teams continue to target the top health care providers and Dallas senior centers of excellence throughout the U.S. with a sense of urgency and focus to ensure brand awareness and patient access which remain our top priorities.

Despite a short selling cycle with the beta thalassemia approval coming at the tail end of last year. The launch is off to a great start we're seeing week over week growth in a number of vials shipped to new and repeat prescribing accounts.

If we receive approval in our second indication myelodysplastic syndromes or Mds for which we are awaiting a decision by the FDA Dupont target action date of April the fourth the opportunity to reach a larger market will grow considerably.

In fact, we estimate that in the U.S. there are more than 20000 patients with lower risk Mds whoever ring sideroblasts and require red blood cell transfusions.

Much larger population than the estimated 1000 to 1500 patients in the U.S. would be to Dallas senior who require right red blood cell transfusions.

Turning to the most recent clinical updates.

At the Ash annual meeting in December we had the opportunity to share new long term analyses in a total of five abstracts from the medalist and believe pivotal phase three trials in Mds and beta thalassemia, respectively as well as the initial results from the phase two trial in patients with myelofibrosis associated anemia.

Among the highlights of the long term results from the medalist trial more than 64% of patients treated with Luspatercept achieved clinical benefit with the median duration of close to two years.

Notably we showed that the occurrence or the most common adverse events that fatigue, SDN and headache were decreasing over time.

I'm also pleased to point out that the topline results from this trial were recently published in the New England Journal of Medicine, marking our first publication in this prestigious peer reviewed journal.

Long term result from the believe trial also demonstrated strong clinical benefit for patients treated with luspatercept overall more than 45% of patients experience clinical benefit with the median duration of almost 18 months and with the occurrence in the most common adverse events a bone pain. After all gen dizziness decreasing over time.

In the phase two myelofibrosis trial patients treated with was passed that experience clinical activity, whether they received red blood cell transfusions or not the most profound effects were seen in patients receiving treatment in combination with ruxolitinib.

Following these positive results in myelofibrosis, we're now preparing for a new pivotal phase three trial called independence evaluating was potter set for the treatment of anemia in patients with myelofibrosis, who are on a JAK inhibitor and require red blood cell transfusions, we look forward to providing you with additional details, but the design of the study close.

So to the trials initiation later this year.

As we look toward the future for Brazil, the consistent positive results now seen across three distinct blood disorders. Further validates proposals novel mechanism of late stage or Threed maturation as a possible platform treatment for thousands of patients suffering from anemia caused by a variety of hematologic diseases.

Turning now to our pulmonary program as shown on slide six we were thrilled last month to announced positive top line results from the pulse our phase two trial of Sotatercept in patients with pulmonary arterial hypertension or P. H.

I'd like to quickly recap those results, which we also reviewed during an in depth investor call with two world renowned experts and ph.

As you may recall the pulse our trial is a double blind placebo controlled study in which a 106 patients on stable background P.H. specific therapies were randomized to receive placebo 0.3 milligrams per kilograms of Sotatercept or 0.7 milligrams per kilogram of Sotatercept Subcutaneously every 21 days.

Over a 24 week treatment period.

The study was powered to show a placebo adjusted 18% reduction in pulmonary vascular resistance or PV are an important human dynamic measure and the trials primary endpoint.

The trial was also powered to show a placebo adjusted 24 meter improvement in the key secondary end point of six minute walk distance.

We achieved statistically significant improvements in both the primary and key secondary endpoints.

We also achieved a clinically meaningful improvement of at least a 30 meter absolute change and six minute walk distance compared to baseline.

The trial achieved other secondary endpoints as well, including change from baseline and NP Pro BMP, an important biomarker of cardiovascular health and change in W.H.O. functional class.

In terms of <unk> of its safety profile Sotatercept was generally well tolerated with adverse events consistent with previously published data in other diseases.

Importantly, 97 patients enrolled in the pulse our trial rolled over into the 18 month extension period of the trial, which will be <unk>, which will provide further insight into long term efficacy and safety.

We could not be happier with the outcome of the Pollstar trial, we continue to believe sotatercept potential to shift the treatment paradigm in P.H. and to provide significant clinical benefit on top of currently available therapies.

I'm extremely proud of all the efforts of our team over the last few years to achieve this outcome.

We hope you can join us for the presentation I'd be more detailed review of the topline results from the pulse our trial at the American Thoracic Society International Conference also known as Ats 2020 on May 15th to the Twentyth in Philadelphia, Pennsylvania.

We also look forward to upcoming interactions with global health authorities to provide us with important regulatory feedback for the future development plan for Sotatercept in ph.

Looking at the overall pipeline the positive results from the pulse our trial further cement our commitment to pulmonary disease. We continue to enroll the spectrum open label study and so how does that patients with P.H. Our phase one healthy volunteer trial Ace 13, 34 is now underway and the close and at the close of 2019.

We announced a research and discovery collaboration with Fulcrum therapeutics to help us identify small molecules that can modulate specific pathways associated with a target indication in the pulmonary space.

With that I'd like to turn to our Hematology program. In addition to the regulatory and clinical activities that I highlighted earlier, our collaboration partner Bristol Myers Squibb recently completed enrollment in the beyond phase two trial was passed up in patients with non transfusion dependent beta thalassemia and expect topline results by the end of this year.

Yeah.

The commands pivotal phase three trial continues to enroll treatment naive patients with anemia associated with lower risk Mds, we anticipate topline results from this trial in late 2021 or early 22.

Moving to our neuromuscular program, we expect to share topline results from the part two of the phase two trial of 83 in patients with the shark cold married to disease or CMT next month.

To recap in this part of the study approximately 40 patients with CMT with mild to moderate ankle dorsa flexion weakness were randomized to receive either 83 or placebo. The trial is designed to assess change in total and contract on muscle volume and fat fraction six minute walk distance time, 10, 10 meter walk run patient reported disease bird.

And and safety and Tolerability over a six month randomized treatment period as you can see it has been a busy and productive period for us it acceleron and with that I'd like to handover the call to Kevin Mclaughlin, our CFO to review the financials.

Thanks to be good afternoon, everyone I'd like to refer you to our press release issued earlier today for a summary of our financial results for the fourth quarter and full year ended 2019 and take this opportunity to briefly review a few items.

We ended the fourth quarter and full year with approximately $453.8 million in cash cash equivalents and investments.

Collaboration revenue for the year was $74 million. The revenue was all derived from the company's partnership with Bristol Myers Squibb and is primarily related to expenses incurred by the company in support of Rubblization as well as onetime gross milestone payments totaling $60 million earned upon the after <unk>.

Acceptance of the B L. A and E. me a validation of the M.A. of Rubblization in June and the FDA approval of Rubblization in November 2019.

Total cost and expenses for the year with $210.4 million.

The company's net loss for the year.

Ended December 31st 2019 was $124.9 million beep.

Thanks, Kevin and with that I'd like to open up the call to questions operator.

Thank you Sir.

As a reminder to ask a question you would need to press star one on your telephone to withdraw your question press the pound key please standby why we compile the culinary roster.

I sure first question comes from Darren rubber from Cowen. Please go ahead.

If your your line is needed please UN mute your line.

Hey.

That's on the quarter it thanks for taking the our crash and this really <unk> honestly on werber. So I just have a cracker lugging fit trading in myelofibrosis can you. Please share with does more probably thought on that and also a incomes of the already adoption on thing you got a little deal kill show.

That's some a little economics in the field creeks. Thank you.

Yes, Hi, this is Andy Thanks for your question I, just want to make sure that I heard the question correctly I think they did the first question was can we share any more details on on the path forward with the C. In myelofibrosis and the second question what can we add any color on in terms of the run Brazil launch in the first indication is that correct.

Yes.

Thank you okay. Okay, great. So as as we announced that we shared with you. The details of the phase two data in another fibrosis, and obviously together with our collaborators at Bristol Myers, we were thrilled to announce that we'd be moving forward I would be independent study, which was basically the stage three study.

Status.

Combined with Ruxolitinib in myelofibrosis patients, which were transfusion dependent and so we said that we would initiate that study in 2020.

Things continue to go on track and really at this point, there's really nothing else to add so we're really excited about moving forward there in another safe again validating the ability for this pattern stuff to be able to restore healthy red blood cell formation in real blood disorders, where do me a it's really the hallmark of.

A lot of these orders.

With respect to your second question in terms of the launch of Revpas, though.

What I can tell you is that we continue to be I'm very very pleased with the initial launch obviously the first indication of a adult beta thalassemia patients where transfusion dependent it's a very small indication in the United States. We estimate it's roughly about a thousand or 15 hunt.

The patient.

So it's a very small indication a young that need obviously still is an important one and we're happy to be able to have an opportunity to cater to these patients with a significant unmet need but when we think about the wants itself.

You'll notice that we we didn't we don't have any specifics interest calling out the actual sales because it's pretty again, it's a very small indication in the United States. Secondly, <unk>, we got approval at the tail end of year and therefore, you think about you put it into context with the launch with the approved.

Well in November coupled that with a major Congress in a couple of holidays, the selling cycle was around four or five weeks industry, either revenues were very low not material or or even informative at this point that said when we think about how things are moving in trends a week over week sale.

Which are continuing to grow even into the new year. When we think about repeat orders, we're very happy with how all of the metrics. When we think about reimbursement hurdles. We're very pleased on how the access a it's a it's continued to progress and thus I would say all in all we're very nicely.

With the launch to date, but obviously the big indication that we're all anticipating in hoping for is the a action date due for the PDUFA date of April the fourth which would be for a second indication for lower risk Mds patients who are regularly trends.

I have just a quick follow up.

Your ROE and just to in terms of the Ats data and and rather afterward should we think about yeah campus development plan and they're sort of two or three phase three studies, including sort of it which study with PD fours or an oral it's sort of what you would think about doing strategy to move up.

Thank you.

Yes, so you're wrong.

First of all you said with respect to the 80 with you, yes presentation and the attempted studies and I'm, assuming you're talking about the PV five inhibitors. So we're not adding any color at this point other than the stuff that we plan to present the data and we can confirm that that data will be at a yes or beyond.

That we will not be sharing any details until after we've had the opportunity to meet with the regulators.

Great. Thank you.

Thank you.

Our next question coming from.

Thank you I next question comes from Daniel Brims from Piper Sandler. Please go ahead.

Hi, guys. Thanks for the questions and congrats again on all the progress I guess I have a couple of follow up.

The prior question.

If I can start their first.

Have you given how things are tracking with what the revenues, though launch do you expect that sales will be called out in and for one Q and then also just any commentary on how we should think about the launch.

He then over the remainder of the here and then can you comment I'm when you might be expecting to interact with regulators I'm on path forward for Sotatercept.

Yeah. So I still think your questions Danielle So maybe I'll answer the last one first so what we said previously that we plan to be interacting with regulators and as soon as possible that you know we said roughly before midyear. This year and then we don't share and feedback with that at the appropriate time with.

Back to what we plan to be sharing with respect to launch a proposal again just to repeat qualitatively what we're seeing in terms of repeat customers growth week over week reimbursement and access we continue to every week be pleased with the progress that we're making.

Now in terms of what you can access that again remember that that used to date for Mds indication is not until April the fourth. So you can probably expect another quarter relatively you know nonmaterial or low or do you know those sales volume because.

To the fact that beta thalassemia in the United States, just simply a very small indication, where we again, we estimate about 1000 to 1500 patients.

Obviously once then yes, you know it's been when Mds is approved.

We want people looking more likely I haven't seen significant sales in Q2, Q3, and beyond which I believe would be much more informative. So I was I would look at that in terms of the cadence in terms of the growth in what you could potentially that.

That's helpful. And then just one more if I may are there any other fibrek diseases that might be of interest protect pattern that you plan to evaluate it fine. Thanks.

Yes, so too so too early to early to talk about that we're obviously thrilled with the preliminary data in our phase two study in P.H. and we obviously have a wonderful opportunity to cater to a very significant unmet need and with potentially or the first.

Drug to be introduced this patient population outside of visa dilatory. The these are 14, but they've been dilatory drugs that are out there. So as you can imagine there's a tremendous opportunity in a lot of work to do still on seems to move so taught us a forward. There obviously its continued interrogate the data we will look for other offered.

And he's will benefit from the council and the regulators in a steering committee to identify opportunities.

Beyond the preliminary indications that we're looking for but that will come with time now what I can tell you, though we obviously are looking and other areas with other assets as well and I think we mentioned earlier at least a I know we did at JP Morgan where are we talking about a is 13 34, which is now in healthy volunteers.

Study, which we believe could potentially be targeting a more fiberoptic driven diseases within pulmonary disease, such as you know we couldn't be looking at areas such as idiopathic pulmonary fibrosis interstitial lung disease, systemic scleroderma et cetera, but we have yet to determine that indication.

Hey, Danielle it's Todd as far as that's how does that goes to the amended agreement with Celgenes last Bristol allows for our development in P.H. indications and so outside of P.A., which is P. age group. One we would have the potential ability if it makes sense from a biology science.

And business case.

For group to or the other ph groups as far as Sotatercept goes, but we'd be limited to being able to develop that based on the current in terms of the amended agreement.

Got it very helpful. Thanks again for the question. Thank you Congrats again [noise] yeah. Thanks Danielle.

Thank you Hi next question comes from Jeffrey project from SVB Leerink. Please go ahead.

Thank you, Brian I'm, not saying congratulations suburban and the team on all the progress up a one financial question, which is you haven't given us any indication about your expense trajectory for 2020, I know, it's not necessarily you're accustomed to give financial guidance, but it would seem helpful too.

Get some at least bracketing of what your expenses aren't going to be particularly I suppose since.

You are going to be Andy you remember <unk> studies on the R&D side, but Conversely, investing in history, and I sort of could you at least give us a sense of whether you expect a significant step up in overall operating expenses this year or whether this is about the right level, even though they might be some flux and then.

Just to go back to sort of tablets that I know you've been reluctant to.

To discuss things about your regulatory interaction, but should we assume that you will be going to the agency with development plan or you got to the agency with the results and Ah and then tell me back with a plan so.

Yeah, I guess setting the expectation or whether sometime in the summertime, perhaps on the Q2 coal we could here the next steps with Sotatercept and or how do you know whether that from a timing.

Okay. Thanks for your questions, Jeff So for the first question regarding the financial guidance in Bracketing I'm going ask Kevin Mclaughlin, our CFO to answer that and then after the second part regarding status and our plan. The plan discussions with the regulators I will ask a our new head of R&D.

Hey, Baxter into to address that one so Kevin do you want take the first not sure. Thanks, Hi, Jeff how are you doing.

Yeah, you're correct that we have historically thought given expense guidance for and yes, you know we no longer give cash guidance I think what safe to say, though is that.

The the we will have a step up in our expenses as the year continues on we will be preparing for additional trials with sotatercept. It. Obviously you know those are all funded by our so there's no cost sharing data. So they'll all be funded by no the size of that step up will be determined.

The type of trials, we have to run and obviously that has not yet been communicated with permanent. So I think it you know we are growing beat the footprint of the company a bit in order to support you know us moving to a fully commercial company a in so there will be growth, but I think you know what small enough to know that.

We we we we do things as necessary, we keep things you know I think well in control and we want to make sure that we Ah we are very effective in the matter, which we spend a the cash we have on board.

Jay could you can't could you answer the second question. Please yeah, Yeah, certainly high so this is Jay.

Yes, I answered the question Oh, you know we are actively interrogating data [laughter]. So our intention. Let me me was asking another health authorities is to review that data. What's embedded you can imagine. We're also in the process is developing a plan, we'd like to socialize and get some input from that as well. So we've been very aggressive an act.

On that right now gauging, our steering committee to further kinda refine that but until we actually mean health authorities, it's just that plan.

You know, we'd like to be able to Miss a beat said earlier.

When I moved forward with those meetings have by mid year. So that's a pretty reasonable time [laughter], Brett how big could I'll just follow up with one other question, which is concerned you should it could you share some of the feedback from your.

Expert advisors in PIH about what you've been able to share with them. So far could you give us a sense of how they're responding and how they're thinking about the product.

Yeah, no what I can tell you Jeff is and I'm not sure. If you had the opportunity yeah actually use I think you did we step and with respect to be the call with a well mcglaughlin and Mark and bear to thought leaders, who joined us on the on the call right. After the date and what I can tell you is that across.

The board the feedback we're getting is that the.

The treaters you opinion leaders are very very excited about having a new mechanism of action for the first time in P.A.

The staff that you know you've got.

Tremendous progress in this disease area over the last 30 years through 14 approvals.

It's really.

I think important did to comprehend in that.

Survival rates have improved from three to five years in nearly 82 now maybe that you know six seven years, that's a significant improvement because of that innovation, but there's still a horrible survival rates. When you think about five to seven years. When the median age of the patients that are being affected by this are you know 50.

55 years old we have an opportunity here could potentially be not only disease modifying that potentially re modeling the disease and if indeed, we were able to do that.

To be able to have significant impact on patient lives.

I hope that we will be able to introduced the tightest up to these patients and can cater to a very very significant unmet need and I can tell you that the community is very excited about that I think that potential but they're also on the feedback that we received or is there really.

Leave with the importance of the data its not just one signet one specific end point, that's driving the optimism, but the fact that there is consistency across multiple endpoints next according to that data seems to be driving I'm, even more of a positive reaction based on the feedback, but I'm getting today that said.

I still a lot of work to do and at the end of the day I would say everyone is excited optimistic but at the same time, we still have a lot of work to do to cross the finish line.

Right, Thanks, very much like color.

Yeah.

Thank you. Our next question comes from Carter Gould from Barclays. Please go ahead.

Hey, great guys, Oh, Thanks for taking my call and Oh. Thanks, Congrats on the progress I guess two questions. Appreciate the color on terms of timing on.

That's one or actually the regulators, but I guess to put you on the spot Habib have you specifically requested that into phase two meeting with FDA, yet and then on on for Patterson with.

On the manufacturing side I believe the phase twos that personal I provided you with material there in terms of your own or scaling up on the manufacturing side any color there and are you gonna be in a position too.

Yeah, maybe just leave it there.

Okay. So with respect to the requested the yesterday, we haven't shared any information of on any interactions with regulators and that's typically not a practice that we do one we've got the appropriate feedback from the regulators in the path forward Carter, we will definitely share that with.

Women with respect to the materials et cetera. We are we are leveraging a third party CNO a with respect to sotatercept material.

Thank you and next question comes from Eric Joseph from JP Morgan. Please go ahead.

Hi, guys. Thanks for taking the question I know, we're still ahead of a formal label and Mds I'm just wondering whether.

In any of the ordering or prescription pad interesting any pull through from a mds.

With revenues, though so far into the extent there isn't any whether there's any sort of a reimbursement pushed back or hurdles that patients are running into and just a second question on the coming back to Opex, whether there are any unique items in the fourth quarter, R&D spend where that sort of an appropriate run rate for thinking about that became spending 2020.

Thanks.

Yeah, Hey, Erika this is Kevin in the fourth quarter was the $10 million charge that went through R&D related to the fulcrum deal that we did so your it's a good observation and that you know it didnt pop up because of that.

And regarding the sales today I'll ask our chief commercial officer Mr., Jay if he wants to chime in or if there's anything that you can really say in terms of incremental color CJ.

Yeah sure Eric Thanks for that question. So as as you pointed out we are still awaiting B.M.D.S.. So approval and Dab you know until that time point very difficult for us to dig into any kind of data sets out with respect to M.D.S.

However, I can tell you is with regards to access as of today you know most of the.

Most of the insurance companies have Bob you know very good coverage for <unk>.

Brazil, and you're not seeing any kind of push back up et cetera, and they're covering two label and that's going according to plan. So we're pretty pleased with the uptake as of now that you're seeing in regards to.

There'd be a you know utilization is coming from for being a policymakers and the accounts per se and spread across the country. It's not whereby you're just seeing got pockets of it it is broadly across where the pockets of influence off would be the policy now.

That's how we're seeing the utilization you know kind of ramp up is wrong. Okay. So hope that helps.

Thank you.

Next question comes from Jeff Honk from Morgan Stanley. Please go ahead.

Thanks for taking the questions maybe if I can ask Eric's question a different way what are you hearing anecdotally about off label use of Brazil.

So maybe I can we stated right. So I guess, what they're seeing is you're not analyzing any off label data said, what we can tell you is that all queries coming in from a medical perspective that that you know information. So there is interest about it but people are up probably waiting to see the see the approvals come true and get just said around the corner.

But before they did they for floor.

So probably people are just looking into the data said to the publication and that they're getting medical <unk> inquiries about a about a the information. So that's kind of they have the right yeah.

Great. Thanks, and then you talked about repeat orders with rubble zone. So understanding limited numbers, but I guess, what proportion of patients don't reorder and where the typical reasons sided if a patient doesn't reorder.

Early days as of now I haven't seen a the repeat orders not come to a show a very positive. There by you know we are getting repeat orders the consistency of it is gonna be different for different accounts, because you know it's not one to one match up between the ordering patterns.

Right, but so far pretty much every account that has ordered at some point in time has gone back and reorder the drug so I'm sure, they're very happy with that with how we're seeing that trend line between new prescriptions and repeat prescriptions.

Okay, great. Thanks.

Thanks, Thank you.

Thank you. Our next question comes from you guys know come over from Citi. Please go ahead.

Hi, This is the mats entre at all thanks for taking my question.

Weve spoken with a couple of how else I bought a thought though and I had a salad and you know they can barely positive on expectations for prescribing and majority of that patient and yeah.

Electrical in their appeal.

But they've noted that they've run into problems that higher authorization I'm curious could you comment on what the volume of prior off you're seeing what percentage got approved and if you're seeing and I'm not far off this expanded indication for your parents discussion to sort of indicate physician interest.

Yeah very very important question then a good one right. So as I just to remind the audience and she knows very well.

Pete launch Red blood cell right now on the part B, which is a buy and bill products right and Underman under the pod beside of the medical benefit side almost always when you're doing this you're gonna have I you need a J code and be out in this period of time that'd be haven't miscellaneous G.

Cool.

And it is very common during this timeframe to you get a permanent part of cord and almost all insurance companies are going to ask for a prior authorization because of listening is J code just triggers that and so that's just part of the process its.

Not out of the ordinary that it happening I said the anticipated that they have extensive support from a BMS colleagues.

Two patient services as well as field reimbursement team members.

Not able to help these accounts appropriately to ensure that defaulted the required billing and coding processing.

So it's a matter it's sometimes could be just the timeframe that it takes to get a the product reimbursed, but it is not being denied as such in any ways for beat a ton of convenience I just want to say that that's a positive trend the anticipated that and it's not going do Londonderry in regards to it till you get.

The permanent J code.

[music].

Thank you that's helpful. And then what is normal timeframe you are getting a J code that's part of that.

It varies it depends from when you actually gone to product approved and you find for the codes et cetera, I can tell you that you've already done B M. I suppose already filed for all the required coding and up to get the Permian J codes. So we should be getting that hopefully sometime later this year.

That's our hope.

It usually takes anywhere between 10 to 12 to 18 months, depending upon when you actually get the product approved I should say cycle time frame. So we should anticipate to get it sometime later this year or early next year, so well well in time.

And other separate J codes for better style, and India, where they do the same.

The the product called the J code would be the same.

The diagnosis codes that different though.

Okay. Thanks, so much for taking my question.

Thank you. My next question comes from Kennen Mackay from RBC capital markets. Please go ahead.

Hi, Hi, Thanks for taking overcautious this is spectrum on for Ken.

Maybe quick one on C.M.T. read out a in march or going into the read all of it so whatever the internal expectations maybe around the some of the functional endpoints you talked about and how shall we be thinking about them.

Yeah, Hi. These are Mrs had the thanks for your question. So again just to remind everyone. Our plan is to reveal the topline results before the end of this first quarter and just to remind everyone. What are the hurdle rates that we've given ourselves again, just the part one.

We have typically seen a double digit increases and total muscle volume and what we hope to be able to do see that again in part to but more importantly to see that total muscle volume translate into a functional benefit.

And when you think about that when you think of functional benefits such as the six minute walk distance for example, what we hope to be able to see unit placebo corrected way, it's a benefit of at least 10% or to be able to give us confidence that to move forward and development pathway for me if we.

If we see that and continue to see some trends across multiple endpoint.

That will give us a the confidence and remember we typically want to learn as much as we've said in phase two and move into phase three with very little ambiguity and have the phase threes confirming what we're seeing in phase two and so we would only do so if we had that confidence to move forward to the next step.

Got it thank you.

Yeah. Thanks for your question.

Thank you Hi next question comes from Leland Gershell from Oppenheimer. Please go ahead.

Hey, how have you been team. Thanks for taking my questions have a couple of one yeah with respect to the J code.

I was one of the impression that at least for.

Certain products has been an acceleration in the cycles, perhaps more frequently as frequently as quarterly versus what it used to be annually is that not applied to your case or a is it just a distinction that I wasn't aware and about a couple of calls.

It's a valid question then that's correct or they are some accelerating some of these that coding so as I said normally it could take as long as 18, but we anticipate that we should have half the cold. So later this year.

Okay.

And then with regard to parents, obviously that spectra trials should be very informative on filling out more more color around sotatercept was wondering if if you could maybe provide us some more.

Sort of description of what you would define as does disease modifying activity for the agents and if there any quantifiable thresholds that you'd want to see in terms of reverse remodeling.

On the images from from spectrum.

Yeah. So I think I can start and then maybe I'll hand, it over to Jay Backstrom to fill in some of the blank. So I wanted just kind of go back in repeat what a dr. Mark from Derek said on the call when a what they would need to see if indeed this is a disease modifying.

Drug no first of all you know for remodeling et cetera, it's really hard to two to two good anything definitive with L. biopsying at that pace in which we obviously aren't gonna do a lung biopsy that said there are other metrics that that one could look at.

To give the confidence of disease remodeling or vascular remodeling and when we look at the cardiac demo rides are you can imagine there'll be a lot of information that we can gain in terms of what's happening I'm with the heart. We also have if you remember what mark them back that the most import.

And element of disease modification functional class improvement, which will pay very close attention to as well.

But at the end of the day kind of going back to Jefferies question regarding where the enthusiasm is coming from remember over half of the patients in the pulse our study we're on triplet therapy.

And.

We are showing an improvement above that they though dilation in these patients and so ultimately see it's the end benefit to the patient that they're going to be looking for whether that's an opportunity to go but not sito dilation functional class improvement.

And our their effects on on right heart function that we'll be able to its stock as we continue to interrogate the stuff the data as well so I think they're going to be looking at all of those Cleveland.

Okay, Yeah and accident. This is great sorry, yeah, just to agree no I think that was well summer.

All right now much appreciate it and then one.

More question, if I, if I may and unless Potter sept without having studied and lower in an intermediate risk Mds. Just wondering is there a scientific rationale or perhaps a clinical or both reason to not studied that agent in high risk Mds is it that the quarter cat.

Every patient is that have other issues going on a lot of them could be you know advance to frankly to two frankly I'm A.M.L. are there other hematologic you know issues going on with those patients just wondering why high risk might not be a scope of interest. Thanks.

Yeah, So maybe I'll take that this is Jay I mean with high risk.

Life expectancy enriched for progression or really different than the lower risk group. So to your point I'm, usually you requiring a little bit more aggressive therapy to try to control that anemia can still be a component to the disease, but the primary treatment goals are really try to prolong survival and reduce the risk of progression to am out comments Correale strategy.

Just some certainly can be considered I think where we went with the development plan, though is to really target the area, where we felt there was just a very very good place for list that are set to be given the absence of other available therapies. It's a really great place for it in the low risk Mds things.

It makes sense, thanks, very much for taking my questions.

Excellent.

Thank you and our next question comes from Paul Choi from Goldman Sachs. Please go ahead.

Hi, This is always on for Paul Congrats and all the recent progress and and thanks for taking your question. So recently I'd ask you had presented the phase two data fairly Patterson myelofibrosis, where we thought that lower response rate and the non ruxolitinib grip. So just wondering if you guys have done any additional analyses on that data or have any more visibility on the delta and responses.

And how you see that impact impacting the the phase three or topic Indian general thanks, So much.

Great. Thanks for your question Jane can you. Please to address some of the purpose of question.

Yes, so like you know as we talked about at JP Morgan you take a look at the study the differences between the rux, even though the patients with without Ruxolitinib that'd be a little bit careful how we interpret that because the numbers were small oh wait to really amplify that would be a little bit additional data. There has been continued efforts underscore a at least.

To assess why with respect to the phase three though and I think again, what we had shared earlier is that we like the combination you know ruxolitinib is very commonly used 30% of patients present with anemia that there is a problem with anemia patients continue even on rocks and so that combination looks quite good and as you know as he just referenced.

We looked at that cohort those data also looked out really quite him a compelling if you will be able to advance to a phase three.

Great. Thanks, so much.

Great. Thanks for your question.

Thank you I should've further questions at this time on like to turn the call over to have be definitely CEO for closing remarks. Please go ahead.

Yes. Thank you. Thanks again, everybody for joining the call obviously 2020.

It's really shaping up to be a pivotal year for for Acceleron very much looking forward to continuing with the progress that we've achieved in the tail end and looking forward to a meeting a lot of you had some upcoming conferences.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.

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