Q4 2019 Earnings Call
At this time all participants are any listen only mode. A brief question and answer session will follow prepared remarks.
If anyone should require operator systems during the conference. Please press star zero on your telephone keypad.
As a reminder, this conference is being recorded.
I'd now like to turn the conference over to Stephanie.
Please go ahead.
Thank you and welcome to the GBP conference call to discuss the company's by natural itself for the fourth quarter and full year 2019 actually provide a business update I, Stephanie our senior director of Investor Relations in corporate Communications joining me on the call are Dr. Tad Love, our President and Chief Executive Officer Cool.
I didn't overview of box Freitas approval and its unique positioning in the treatment landscape for sickle cell disease.
Cerro our Chief Financial Officer will provide an overview of our financial results. He will be followed our chief commercial officer, David Johnson or D.J. to give an update on US brightest launch pad will then provide an update on our research activities and discuss GBP 2020 key milestones and the company is long term vision.
Earlier. This afternoon, we issued a press release announcing JBT is business progress and financial results for the fourth quarter and full year ended December 31, 29 tier before we begin I would like to remind you that certain statements. We make on this call that are not historical facts, maybe forward looking statements that are subject to risks and uncertainties.
Information concerning factors that could cause actual results to differ materially from those expressed or implied by such forward. Looking statements are contained in our SEC filings, including but not limited to our most recent quarterly reports on form 10-Q, as well as today's press release copies of our SEC filings and press releases can be.
<unk> pain from the investors page of our company website at GBP Dot com.
Forward looking statements made on this call are only as of the time. They are made and you should not place undue reliance on such statements future events or simply the passage of time may cause our beliefs to change and we disclaim any obligation to update any forward looking statements other than as required by law.
That I will turn the call over to Ted.
[laughter].
Thank you Stephanie and good afternoon, everyone.
Thank you for joining us for global bought Therapeutics inaugural quarterly update conference call.
2019, what they historic here for the second sell community.
And we are proud the G.P.T. was part of making that history with the FDA approval and subsequent launch of occupied.
[laughter] Ox Friday is first and only medicines that directly inhibits scope hemoglobin polymerization, [laughter], which is the root cause if sickle cell disease.
We are thrilled that within days of its approval.
We were able to make this medicine available to the sickle cell community, which demonstrates the quality of the team that we put into place here at JBT.
We believe that overtime right now.
All medication taken once daily.
We'll demonstrate the potential to fundamentally transform the course of sickle cell disease.
[laughter] occupied was approved by the FDA on November 25, 2019, three months ahead of its could do for date.
The accelerated approval of occupied it was based on the results of the Phase three hope study, which were published in a no general medicine in June of 2019.
That's right. It was approved with a very broad label to treat sickle cell disease in adults and children 12 years of age and older.
The label also noted I try to improves hemoglobin and other clinical measures ophthalmologists.
And that it may be given with or without hydroxyurea.
Based on arthritis slate.
We have an immediate opportunity to potentially improved the lives of approximately 86000 people with sickle cell disease in the United States.
The second thing I've Red blood cells caused by the disease associated with long term organ damage, which contributed to the estimated 30 year reduction in life expectancy.
This is very important when you consider that chronic organ damage is the leading cause of death and sickle cell disease.
Our next Friday is unique in the market as the only treatment that directly addresses hemoglobin polymerization.
And the resulting sampling of red blood cells.
[laughter].
Probably still early in the launch we've been encouraged by the feedback from doctors, who prescribed back spread out and the patients who started taking yet.
And by the general awareness and excitement for the medicine within the sickle cell community.
As part of our launch activities.
We've had the privilege to interact with several patients who are taking off right now and have shared but our team the m. crack spread out that's already made on their lives.
Let me tell your story about one patient I had the privilege to meet a couple of weeks ago.
This patient share that but take before taking our spread out.
He had a very low hemoglobin level of around 6.5 grams per deciliter.
Which led to extreme.
Fatigue and anemia.
He also experienced pain, but the fatigue, what's what took over his life [laughter], making it impossible for him to continue his job is a caregiver for the elderly and to take and to be the father he wanted to be to his children.
Even said he felt like he wasn't going to live to see age 35.
On a Friday is hemoglobin level increased to 9.5.
And he showed improvement in markets have been mouses.
He now has its own business and can play an active role in the lives of because children.
Yes, it's a type of impact we had TBT set out to make when we created hopped brighter.
We want to help improve the lives of every person with simple sell disease.
You know what are the do it yes, we know that we need to flawlessly execute on the launch of our spread out so that we can meet the needs of this patient community.
I'm going to now I'll turn the call over to Jeff to share more about GP taste financial health and the operating results for the fourth quarter Jeff.
Thank you Ted GBT had a very productive fourth quarter and this is true from a finance perspective as well total net revenues for the fourth quarter of 2019 was 2.1 million, resulting from sales of luck sprite, which we began shipping in early December.
From an accounting perspective, we recognize revenue when our specialty pharmacy and distribution partners receive aucs brighter.
Accordingly, it's important important to note that our fourth quarter revenue reflects initial stocking why or distribution partners and it's not an overall indication of overall prescription pull through the patients in December.
That said, we do limit our distribution partners to holding no more than approximately 30 day supply box brighter.
As previously communicated we will not be providing looks brighter revenue guidance during 2020.
And we will not be providing detailed metrics on this call is we believe it is too early in the launch to draw any conclusions from this dataset other than to say, we're very happy with how the launch is proceeding.
[noise] on our first quarter 2020 call when we have a full quarters worth of revenue, we expect to be able to provide additional metrics. These may include enrollments and GBT source or patient support program health care provider penetration and payer coverage as always our goal will be to provide useful.
Metrics based on high quality data available to us.
Cost of sales for the third for three months ended December 31st 2019 was $48000 cost to sales was low in the fourth quarter as the majority of the manufacturing costs related occupied a sales were incurred prior to an FDA approval and thus were recorded as R&D expense.
We expect the cost of walks probably to sales as a percentage of revenues will increase in future periods as product manufacturer private FDA approval and therefore fully expensed is utilized.
Research and development expenses for the fourth quarter 2019 were 65 million compared with 36.8 million for the same period in 2018.
The increase in R&D expense in 2019 was primarily due to increased clinical and regulatory costs for the ups brightest sickle cell program increased employee costs, including noncash stock compensation and a 20 million expense incurred related to the Ciros pharmaceutical collaboration agreement.
Sales General and administration expenses for the fourth quarter 2019 were 44.6 million compared with 15.3 million for the same period in 2018.
The increase in SGN expenses was primarily attributable to increased employee related costs, including noncash stock compensation and increased professional and consulting services associated with the build out our commercial operations and launch a box brighter.
A noncash gain of eight point threemillion on lease modification in the fourth quarter is a nonrecurring item related to our upcoming move to our new location and the termination of our existing lease.
Net loss for the three months ended December 31st 2019 was 96 million compared to 49.2 million for the same period in 2018.
Basic and diluted net loss per share for the three months ended December 31st 2019, where the dollar 59 per share compared with 93 cents per share for the same period in 2018.
We ended the year with a strong balance sheet and with cash cash equivalents and marketable securities of 695 million compared with 591.8 million at December 31st 2018.
This includes proceeds from the first 75 million traunch from 150 million dollar debt facility with funds managed by Farmacon advisers that we entered into in conjunction with the cereals collaboration agreement.
We have the auction, but not the requirement to draw an additional $75 million under the facility until December of this year.
We believe that the proceeds from this loan in conjunction with our existing cash and investments have the potential to provide the necessary runway for the company do achieve positive cash flow, while enabling continued advancement of clinical development programs and other earlier stage product candidates [noise].
With that I will now turn the call over to DJ to share more about our aucs bridal launch activities [noise].
Thank you Jeff.
Good afternoon, everyone.
It is truly exciting to be here today, providing our first update on the launch of walk Freida. We're very pleased with how the launch is going so far.
One of our priorities is to get out there and educate physicians about looks brighter and its approved label I'm proud that our team was trained Onyx brightest label on the day about FDA approval and has been in the field sense engaging with health care professionals about the medicine. Our field team is targeting nearly 6000 health care providers that represent the top sickle cell traders in the United States.
Most of these healthcare professionals around the 17 states. It together represent approximately 85% of the people what sickle cell disease in the country importantly, while our team is focused on these geographies. We have built strategy and coverage plan designed to leave no went behind and educate healthcare professionals no matter, where they're located in just a few short months following approved.
So are there therapeutic specialists have reached approximately 80% of our highest decimal positions and overall have reached more than half of the nearly 6000 targets health care professionals in the United States. In addition, our medical affairs function has a team of medical science liaisons or M.S. cells were focusing on.
Approximately 500 key opinion leaders in sickle cell disease.
Our MSR sales have reached about 70% of them since aucs bright as approval. While it's early we are encouraged by physicians initial awareness of Bucks brighter and their eagerness to learn about the approved indication and label results from a poll survey. We conducted after approval showed that aided awareness about right a among top sickle cell disease specialists has reached.
More than 90%.
This is an impressive result for just weeks after a medicine was approved a.
Additionally, hematologists are reporting an understanding of where our threat to fit into the treatment paradigm, but sickle cell disease, given its unique mechanism of action, which directly acts upstream of other agents in our survey of specialists. The most commonly cited benefits of Bucks brighter include increasing hemoglobin levels, improving improving anemia and reducing homologous.
We're also beginning to see a differentiation in how physicians intend to use entrepreneur to reporting potential broad use of the medicine consistent with the approved label.
And among specialist who have tried aucs right off the majority report being very satisfied with the medicine overall, even with physicians on board, we often need to educate the care and administrative teams within some of the larger institutions before we see broad utilization of Bucks brighter in these settings in terms of formulary coverage.
Leading up to approval, we work to educate payers about sickle cell disease and learn about their specific processes and timelines for considering new drugs. So this is our first launch we immediately immediately following approval we filed our CMS rebate agreements that will allow us to do business with our government payers. This is a requirement for companies launch.
In their first product for Medicaid. Each state then has a period of time generally one to two quarters to load and activate these agreements. We are engaged in meeting with payers to share it be approved label and to inform their clinical reviews of box brighter.
As Jeff mentioned, we're not going to report detailed metrics on payer coverage since launch, but we do think it's important to provide some color on how those discussions are going I'm pleased to report that it then in these discussions today, we have seen positive interest from payers importantly, during the fourth quarter, we have had prescription cover.
Third in all three payer segments, meaning Medicaid Medicare and commercial through the medical exceptions process. This is despite an abbreviated timeframe from Inox right. It was approved in late November and the proximity to the holidays and we are already having a few payers that have added aucs right it to their formulary.
On the Medicaid side, Florida is one key state we're off to write a has been added to the state formulary with broad coverage consistent with the hope study enrollment criteria. Alabama is another example works bridal is being covered to label.
In terms of commercial insurers, United Healthcare is reimbursing claims a much brighter and some of the blues plans such as Bluecross Blueshield of North Carolina, and Horizon Blue Cross Blue Shield of New Jersey are now covering aucs Rhino with broad coverage policies consistent with labeling several Medicare part D. Plans are also reimbursement claims for us right.
Notably Silverscript and Humana, which is the largest unsure of Medicare part D. Drugs of course, we expect pair decisions to vary with each imposing with with some imposing greater restrictions or not choosing to cover all right. But overall, we believe we are on track with our plans for occupied a payroll.
Coverage, we continue to expect the first and second quarters to be focused on meetings and payer evaluations with increasing coverage beginning in the third quarter and achieving our goal of broad coverage by the end of year.
With respect to with respect to GBT source, our high touch patient support program. We are proud that we launched the hub on the same day as the FDA approval of Aucs brighter.
While this support is unique for the sickle cell community. It is a best practice for rare diseases, and we think this community deserves similar support as other important diseases.
It is gratifying that physicians and patients starting started off prior to treatment within days of approval. These patients were successfully enrolled and supported by GBT source and from the pull survey I mentioned earlier. The majority of specialists have reported finding GPU source to be responsive and helpful. When getting their patients access to watch brighter.
However, not everyone has used patient support programs before especially in sickle cell disease, and we're finding that so many more support to understand and adopt the process continuous education is the key which we are proactively providing but this will take time and we've seen enough as we've seen in other rare diseases that have been historically under resourced.
Additionally, we know that reaching patients and physicians to inform them about occupied it will be critical to the successful launch.
The can condition of Mcbride has accelerated approval, we are required to submit all marketing materials to the FDA for review we did this back in November at the time of Bucks bright as approval. While we're pleased that we've received comments on the patient marketing materials and are currently working to finalize them, we're still waiting for the agencies feedback on our marketing materials were health care professionals.
Our goal is to launch our healthcare professional marketing campaign in the second half of this year.
We are happy that launch is going well and according to our plans, but we recognize we do have some heavy lifting ahead of us having launched more than 17 drugs in my career I realized that we need to be flexible nimble and ready to adjust based on the emerging trends and metrics, but we're off to a great start I will now turn the call over to Ted to provide an update on our clinical development activities and.
Short term and long term priorities.
Thank you Dick.
Maximizing the potential of occupied has launched remains our key focus.
And if we think about our long term mission, we believe that a successful launch will enable us to advance.
Other initiatives to improve the lives of people with sickle cell disease around the world.
One example is by potentially expanding occupied is label to include patients younger than 12 years of age.
We plan to meet with the FDA in the first half of this year to discuss this and will provide an update afterwards.
We're also working to make occupied available to patients outside of the U.S., including in Europe.
Similar to the U.S. there is a relatively focused.
Population of sickle cell disease in Europe, which we believe will allow for an efficient commercial infrastructure and launch.
We plan to meet with the M&A to discuss the regulatory pathway and next steps toward approval and will provide an update in the first half of this year.
Outside of Europe, we're developing a strategy with a goal of ensuring long term.
Sustainable access across the spectrum of health Claire Cao healthcare delivery systems.
Particularly in the complex.
And underserved areas of Africa.
Asia and South America.
We also continue to focus on generating scientific evidence.
It will help inform clinical use of bucks brighter.
At the end of 2019, we initiated the whole kids to study our post approval confirmatory study.
This study will use transcranial Doppler flow to measure the effect of rock spread at and reducing the risk of stroke in children with sickle cell disease.
It will enroll approximately 220 children ages two to 15 at sites in the United States Europe and Africa.
We agreed with the FDA to complete this study by 2026, but we are working to complete the trial sooner.
In January we initiated a dose optimization study.
To explore the safety and Tolerability of box brighter.
Daily doses of 1500 to 3000 milligrams per day in patients with sickle cell disease.
Additionally, later this year, we plan to initiate the active study.
Which is designed to evaluate the effect of OCC spread out.
On physical activity in adults and adolescents with sickle cell disease.
Turning to our pipeline, we are focused on advancing Beth scientific approaches to transform the treatment of sickle cell disease and other grievous blood disorders.
Our most advice advanced pipeline candidate and clock AMAP is a novel fully human monoclonal antibody against piece select and that is being developed to treat severe pain also known as they so close if crisis associated with sickle cell disease.
We are preparing to initiate a pivotal clinical study for in Clackamas in the first half of 2021.
In December we announced the collaboration with zero to discover develop and commercialize novel therapies for sickle cell disease, and beta thalassemia, using cirrhosis gene control platform to identify therapeutic target and discover small molecule drugs.
That induce fetal hemoglobin.
Our goal is to bring other innovative and differentiated medicines into clinical studies.
We also continue to work in our own labs.
We are occupied it was discovered on potential next generation small molecules.
We are excited that more investment and focus on sickle cell disease research is being advanced.
Our team is closely tracking these developments and remain focused on building a balanced best in class pipeline.
Before I close I'd like to give our deepest thanks to the sickle cell community.
The patients families advocates investigators and clinicians.
And other partners without the approval of box brighter simply would not have been possible.
I'm, especially proud of the team we built that GBT.
A team comprised a people.
Whose focus passion and determination.
Our centered on helping people would sickle cell disease.
While we clearly have a lot of work to do we feel we're on our way to realize our vision of making sickle cell disease, a well manage chronic disease.
With that we'd like to open the call for questions operator.
Thank you.
Now be conducting a question and answer session if you'd like to ask a question. Please press star one on your telephone keypad.
Confirmation tone will indicate your line is in the question Q.
You made fresh start to if you'd like to remove your question from the Q.
And the interest of time, please limit to one question and one follow up question for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star Keith one moment, please while we pull for questions.
Your first question comes from line of Jim Birchenough with Wells Fargo. Please proceed with your question.
Hi, guys congratulations on a.
On watch and and all the progress I guess.
One question, what what I, just think about the 2.1 million that was came in in December and the comment that the agreements started a whole no more than 30 days of inventory should I assume or should we assume that that was pulled through within 30 days I just want to make sure I understand that and then I'm just wondering from DJ.
Perspective that the payer agreements you haven't place right now could you say what proportion of covered lives that represents thanks.
Well, maybe Jeff can get started all by DJ Sure Hi, Jim. This is Jeff in terms of your question on on the metrics. It's early days right and so the estimates are sort of developing as time goes on but I think.
That's a pretty good rough estimate of one that would have expected to be cleared.
In regards to Jim's the DJ regarding the the question about the payer agreements a percent of covered lives. You know, it's really early days still and so we don't have a breakdown of percent covered lives that is one of those metrics that we're looking into providing at the Q1 call. We always expected that there would be.
Some payer plant that would come on early.
In addition to plans that were adjudicating patients based on medical exception and we're just excited today to be able to confirm that its cleaning out the way we expected that there are some coming on.
Early in those are the ones that I commented on.
And DJ maybe just as a follow up you mentioned the heavy lifting ahead is there anything that's surprised you in terms of that heavy lifting any barriers that you've seen that you didn't think would be as big a barrier or anything in the heavy lifting that that's a surprise in anyway.
Yeah, I guess, the one surprised that I've talked about is that there have been no surprises. So no. This is playing out according to plan at this stage of the game that said there is always learnings work, we're looking into everything every day.
We are having interactions with customers from the payer side the patient site in the in the physician side every single day, so but things are really playing out. According to plan. So so that's great. We did always expect there to be a big educational push in the first quarter of launch where we just really need to get to everybody. Both on the payer side as well as.
Physicians in the institutions it sometimes not the physician in the institution that you have to convince it. So you have to going to make sure that the staff understands the new product in the pharmacists and all that good stuff. So that's what we built for and that's where we're in the middle of doing.
Great. Thanks, Thanks for taking the questions and congrats again on the progress.
Thank you thank you Jim.
Your next question comes from line of I'll, let Steve Young with Cantor Fitzgerald. Please proceed with your question.
Hey, guys. Thanks for taking my questions. Congrats on all the progress so far so maybe a two for me I mean, I guess can you just kinda talk a little bit of probably about the experience that you're seeing in hub.
And I mean, it probably too early to talk about in kind of timelines there, but just kind of any color you can offer up on the having in the second one obvious stuff I'm intrigued about was just under 12 year old population that you're going to talk to talk about with the FDA can you just maybe talk about how much you know kind of information you have in the population so far and maybe some of those scenarios associated with that conversation in the first half the year. Thanks.
Maybe I'll start with your second part and then DJ we'll come back to your first question late there.
So that's the purpose of the meeting with the FDA has to go in and talk with them about how much data they would like to see.
In the various age categories to support lowering the label our likely strategy is to.
See how many patients they want to see in the forward a 17 year old range to drop the label down to four years old as you know weve been treating.
Patients below.
In that age range up for.
To 17 for a couple of years now so weve accumulated a significant amount of data.
And we just need to find out what the FDA exactly how much data will be needed to modify the label and will give an update as soon as we learn.
Yes.
Regarding the hub so it's early days.
For many people. It's the first time using the hub I am excited to say that we did this pull survey and the pull survey that I mentioned in my comments as is 40 40 physician. So it's a quick a survey that we did in December and and it's not all special whats right. So these are folks that have you know significant number of sickle cell pace.
And when we post them about the access program and specifically GBT source, we heard the vast majority over two thirds agree or strongly agree on things like responsiveness on.
Ease of access to the program and those types of metric. So that's you know that gives us a lot of confidence that the GBT source was set up in a way to help optimize this whole process. So things are things are going great. There now that said there are clinics that are just getting up and running and are seeing their patients now that we have to make sure. They understand a you know the services that.
We can provide those as well as filling out the form and getting it into the enrollment in so.
That's what I mean, my they're still heavy lifting to do we have to get to everybody and make sure. We do those those trainings.
Your next question comes from a line of lie low usage with Cowen. Please proceed with your question.
Hi, everyone. Thank you for taking the color for file on fairy tale.
I wanted if you can elaborate a little bit on that dose optimization study and specifically where you plan on conducting it and any potential estimate for enrollment. Thank you.
Thank you Lisa this is Ted.
So the dose.
Optimization studies being conducted in Europe.
You'll recall, we did our initial phase one two program in London, and we're basically going back to the same centers there is significant.
A population of sickle cell patients in London that makes it.
Readily available for us to do this kind of study.
So the way. The study is designed is that all patients will began on the approved dose of 1500 milligrams.
And they will be dose escalated up to a maximum.
Three grams per day.
And what will be looking for is.
The dose.
Which patients so essentially maximize the activity our response to the drug.
Our obviously the dose, which there's a tolerability issue, which we've not seen as you know up to $1500 ramps.
And the reason for doing this study is that if you look.
At our patient experience so far.
You literally see.
Some patients effectively reversing their sickle cell disease.
They are Billy Rubin returned to normal retail account returns to normal hemoglobin goes to normal and what we're really trying to explore is whether or not we can produce essentially the normalization phenomena in an increasing number of patients were very excited about that and that's really the intent of that study.
We the study on the also and by saying that study is being done in an open label format. Because this is a steady what we're looking at objective endpoints of of hematologic response.
And we'll be collecting data throughout the year potentially making some data available toward the end of this year our next year.
Your next question comes from line of Liana Moussatos with Wedbush Securities. Please proceed with your question.
Thank you for taking my question do you think reasonable for analysts to estimate that they're over 100 sickle cell patients taking bright.
Right now.
I know, Jeff would love to answer that question [laughter].
We're not giving lialda patient numbers at this stage and given the fact that there was some stocking that took place and there were some pull through into the first quarter.
We hesitate to give guidance in that regard I think what you'll have more clarity in the first quarter call.
Okay, and then we'll manufacturing cost impact cross sales instead of R&D by the end of this year.
We expect.
Cost of goods sold will be light for the first several quarters and ramping up into the latter part of the third quarter in the fourth quarter to more normal ranges from a gross margin perspective.
Your next question comes from line of Danielle Krill with Piper Sandler. Please proceed with your question.
Hi, guys. Thanks, Thanks for the cousins and congrats on the progress.
I guess first first question is for DJ and some of the authorization requirements you're seeing.
Just regarding some of them more restrictive.
Rex that are popping up I think you mentioned in the past that some parents just need more education I'm curious how cumbersome process is to modify these P.A. requirements that once they've been establish.
Yes, Thanks, Danielle it's early days in so so I don't have a big.
You know end to call on for this week I can tell you that we have had some isolated situations, where we felt the restrictions were more severe than they should be and we're not consistent with labeling and happy to report that in one of those in particular, a which is a which was a blue cross blue.
She'll plan, we were able to get in there with the team we have a highly experienced payer team that has done this on multiple launches.
And to get in there very quickly and do an educational intervention and to the credit or that are the payer plan. They made the change within a week about meeting. So we have seen the ability to go in and went through good science and good interactions and good dialogues the ability to make those changes and in that case. It was it was very clear that I'd.
That it wasn't consistent with the science or the label and and the payer agreed with that as well. So so we have had those those situations I'm also happy to say that it's it's rare that we've ever had to do that I mean, most of the most of the plans that have come onboard early have been consistent with what our.
Goal is which has broad coverage consistent with hope study consistent with our label. So we have not had to had to have many of those intervention thankfully.
Got it very good and.
You mentioned you guys have targeted already reached.
A lot of your targets just curious have you received any intake forms from the providers that you're right not engaged with and then I guess for Ted curious what.
Your views on some of these companies competitive approach is increasing.
Hemoglobin for sickle cell such as PK, our job from yes. Thanks guys.
So maybe I'll get started then we'll come back to you gave DJ so with regard to those kind of products.
Danielle as I was referencing.
In my comments earlier, we look at all of those programs we actually.
When we can produce molecules.
Those characteristics and studied them. So we're very aware of of these other approaches and it really is our intent to.
They either do some of these things if we think there useful.
Ourselves.
Our partner when.
We think it's appropriate but.
The thing I wanted to just make sure people understand is that.
There's really very little going on in sickle cell disease, IGBT isn't fully invested in understanding and partnering if it makes sense rough.
And regarding your first question about.
We identified additional people through enrollments and whatnot that that may not have another target listen that's exactly right and that's why we're saying that our target list, which are the dynamic target list. We have the ability to add those folks immediately to target list. If they show up either don't enrollment or often oftentimes when they.
One of our therapeutic specialist is talking to one of their targeted health care professionals. Another health care professionals in the office, that's quite interested inox brighter and wants to start taking on the treatment of sickle cell disease. So they have the ability then to add that person to the target list. So our target list has gone up sons from a lot of 5500 targets to nearly.
The 6000 targets just through that process and we've certainly seen some people enrolled patients that that weren't on our radar that they clearly had patients. So that's that's very exciting.
Your next question comes from the line of that Matthew Harrison with Morgan Stanley. Please proceed with your question.
Great. Thanks for a thanks for taking the crushing and for the update this afternoon I guess.
One could you just maybe talk a little bit more detail and I know you've done. This before you know in terms of.
Where are you are in the process with Medicare specifically, it sounds like you've been able to achieve some.
Early results with some plans, but broadly I know, there's a there's a timeline associated and when these plans typically.
Look at additional coverage and then Jeff just separately can you just just for clarity sake can you just tell us how much if any in your view of what you saw in the fourth quarter was.
Pull through versus inventory thanks.
Sure. So Matthews, Jeff I'll start we were were hesitant to give exact patient numbers, but there was.
A significant there was a fair amount a number that came through in December that were paid drugs through medical exceptions as opposed to through.
Pair adjudication process so.
We're not going to give exact numbers, but there was a fair amount of those that didn't happen in December and then the rest was pulled through in subsequent periods in the first quarter.
And regarding Medicare part D work I wouldn't say that were kind of at the same place. We are with all the payers were in the education mode. So we're meet with all the Medicare provider for meet with all the commercial providers as well as the Medicaid providers as well Medicare part D for us tends to be dual eligibles a lot of our patients are dual eligibles.
So that's that's a situation where they have some really good health care coverage through those programs to help low out of pocket the low copays through the dual coverage and and and as I said in my comments, we have seen some of the big Medicare providers, namely Humana and Silverscript.
Start to adjudicate patients and pay for those patients. So Medicare is a smaller part of our payer mix overall, but I am I am excited and to see that that they are coming online.
But many of them still are being educated and we expect them to be online in Q3 in Q4.
Your next question comes from like E. Yatin Suneja with Guggenheim Partners. Please proceed with your question.
Hey, guys that's all.
Thanks for taking my question can you maybe.
Help us understand what.
Measures taken to make sure patients are compliant.
The therapy once they get Ed.
Your expectations in the long from compliance perspective.
And.
Jack if you can maybe talk a little bit about the gross to match.
Okay.
Yes, Yes, DJ taken did you could you explain a little bit more holistically, what they have done even hung on compliance, yes, GBT source solutions. You know recognizes the compliance is a is a critical factor in any chronic disease, but certainly.
With occupied and sickle cell disease. So we built out in from from day one.
The compliance measures include things like foot refill call backs, we even have a text option as as one enrolls in the hub, it's much more than than just a prescription there's a patient consent involved it allows the patient to opt into too. Many of these features most patients are interested in having a call.
I'll back or a tax for an email or all three.
You know ahead of running out of of drug in any given month. So we provide that service if that are customized SP level. It that the hub level, it's all coordinated and kind of quarter back by the hub. We also do a significant amount of education. So we have nurse educators in the GBT source for patients that.
Education always seems to help with compliance and then of course, we have our patient navigators would or field based GBT source.
Resources that go into the clinics and have the ability to actually talk directly to patients about the hub services, but more often than not are also talking to the staff within the clinic and making sure. They have the information they need to educate the patient. So all those together really support the compliance of the patients and we feel compliance will be good because of that not to mention.
Of course.
The profile of box brighter and the benefit that will bring and hopefully drive compliance as well.
So you on this is Jeff just turning to your gross to net question. We didn't put provided proactively just because it will fluctuate over time based upon the pair mix, but for this quarter fourth quarter was actually about 24% and.
And we saw a fair amount of Medicare part D come through so accounting for the donut hole.
Contributed to the little bit higher on the gross to net side of things there.
Your next question comes from line of Mark Breidenbach with Oppenheimer and company. Please proceed with your question.
Hey, guys. Congrats on the progress in just a couple of quick ones from me.
First of all should we expect that your specialty pharma partner network will be releasing script data to third parties.
To help us track scripts and also a question given the potentially long timeline for hope kids to I think I heard headset. It has to be completed by 2026 is it possible we could see the phase where active study step in and complete.
Before we look at do and possibly served as a confirmatory trial for us right. Thanks.
So mark Thanks for the question I'll I'll take the first question and maybe path into to Jeff.
Ah, yes, the as I said in the early remarks.
The TCD study the confirmatory trial.
Is by agreement with the FDA.
Designed to read out in 2026, we're working to do that earlier.
But but thats the.
Agreement with the FDA 2020 fix the active study as you reference.
Well probably have some data available in 2021 would be our expectation. So we'll be starting that trial later this year and expect.
It's likely have some data available in the subsequent year. In addition, there are other studies that we are planning that will also be reading out earlier because the go really here is to even before the TCD study readout to continue to support.
Provide evidence to really show, but aucs, Brad is doing in fundamentally changing the disease. So we expect studies to be reading out.
Overtime, because some are designed to read out much more readily.
Hi, Mark This is Jeff just to touch on the first part of your question. We are blocking Ikea from reporting data as most rare disease companies do just we want to make sure that there's certain context around the script data so.
That won't be available publicly.
Your next question comes from line of Matthew Hall with JP Morgan. Please proceed with your question.
Hi, guys. Thanks for taking my questions I wanted to follow up on the prior authorization criteria for the Pos that aren't to label can you provide some color around what additional requirements you're seeing.
Hey, Jeff Yeah Matthew.
The.
I'm happy to say, most are to label and to and or to the hope.
The hope study criteria entry criteria, which as you know is is brought entry criteria.
So those are really thus the standard that we've been seeing you know I referenced earlier, one that was a little bit tighter than that that had some requirements around vo C and things like that that we just it was not consistent with labeling. So once we had that discussion that was changed immediately.
We oftentimes said, although I don't have any specifics for you at this time and in Q1 I'm sure. We'll have kind of a larger database, but we've often expected that there might be some soft step edits.
This year and a soft step edit edit for us would be a physician at a station that or things like Hydroxyurea had been offered to patient and so that that would not surprise us nor would it be a barrier to physicians given that hydroxyurea has been offered to most every patient and can be used in combination with aucs brighter or.
Or ox brighter in monotherapy. So we don't view that as a barrier, but that could be if that could be a prior authorization soft step that that we would expect.
But I don't have any hard.
Additional PPA used to discuss at this time.
Great and then I realize it's early but any sense of how does reductions are being handled in the commercial market given the switch until size when compared to the clinical trials experience.
I'm not aware of dose reduction data we.
Certainly at this stage.
As you know gearing the condo.
The whole study.
There was really no appreciable dose reduction going on because.
A drug is so well tolerated.
In fact I. Thank.
If I recall.
The the.
The discontinuation rate for.
For diarrhea wishes rare.
I was I think there was one in the placebo group and zero and the 1500 milligram arm.
Your next question comes from the liner Paul Choi with Goldman Sachs. Please proceed with your question.
Thank you and good afternoon, everyone.
The first question is for DJ DJ could you maybe comment a little bit on.
What your Salesforce and sharing with regard to their initial discussions with.
And subscriber specifically.
The receptivity to a biomarker data points in the label or they perhaps with another product approved shortly before Youre, maybe focused on CE Mark any qualitative comments you could offer there would be great.
Yes, Thanks, Paul I would say that positions are thrilled to have aucs bright.
As a therapeutic option there has been such a dearth of innovation in sickle cell disease, historically, and having to new products in close succession has been a real positive reception I'm sure.
For Novartis as well as us, but certainly from our perspective.
Physicians are welcoming us with open arms to common and talked about next brighter we have not had the push back around the mechanism in fact quite the opposite it's a very unique mechanism with aucs bridal it's the only.
Therapy that works at the polymerization fundamental phase of sickle cell disease. So people are quite intrigued by that and.
And then of course, having hemoglobin increase is viewed as a very positive thing given the patients generally habit habit decrease over their life and now being able to have an intervention. So we've not had the pushback.
The idea that the F.D.A.
Approve docs Freida in record time on a three month review under Subpart H gives people a lot of confidence that not only is occupied a very safe.
But there's a there's a real need for it. So we've had really good reception I would say, yes, I mean I'll add to that I mean, everything then and there is that this sense.
Claim and plumber innovation, our fundamental and successes A's and this drug.
It's designed to inhibit that.
It's not surprising that.
Physicians see the truck working they see the hemoglobin going up Xcede evertec going down the patient sees there John this resolving the patient feed their capacity to do day daily activities increase so that's really one of the nice feedback loops areas that.
I think we're saying that in the data that Djs collective where physicians are communicating that they're very happy with the product and I think if it gets the patients are telling them, they're very happy with the product.
Just how many called times on calling on doctors prescribers are you thinking about.
We've acquired just in terms of education.
Before you get an initial prescription baring any thats going to be a multi call up or maybe what.
Any color there and that I'll follow up question on data for this year.
Yes, Paul good Great question, and I did and I do want to kind of preface my earlier comments as well as these with what I mentioned in my in my comments of the script is that you know we also recognize that theres a lot of heavy lifting still to do we we recognize that just walking in and introducing aucs right on one call.
For some positions isn't going to be enough and then they really need to understand it. They also need to have a conversation with the patient and sometimes the whole family and then have the patient come back in for a second visit after they had a chance to to internalize up before they start even discussing the prescription. So there's a process here, there's a lot of education that needs to.
To happen our Salesforce is seeing the nearly 6000 physician targets, we try to see.
The majority of our physicians every single month and of course, the highest decile physicians with the most patients.
Multiple times a month, so and that's just to your point, it's it's a recognition that it's a process and we have to constantly be in there and share the information and it's not just the physician or the prescriber. Its oftentimes the whole staff that we want to engage it's it's getting everyone onboard with helping sickle cell patients. So.
You know and that's how we built the team our team is built to do all of that.
Okay and can you guys I Didnt hear it earlier in your comments can you just confirm that you'll have updated data at a medical meeting later this year and just how do you think about that as commercial driver in the second half.
Yes, Paul Thanks, the so the last minute data from the hub steady as a 72 week data and as we previously guided.
72 week the study its growth play underpowered to look at things like VIP. So what we're really looking for is to show that the drug effect continues to be durable.
And we fully expect that the data will either be presented.
In a publication or a major medical meeting before the year as al.
Your next question comes from line of Christopher Marai with Nomura Instinet. Please proceed with your question.
Hi, This is Jackson Harvey on for Christopher MRI I was just wondering if you can give us some early insight about the patients that are starting to for example are these the.
Low hemoglobin patients that are interacting with the healthcare system more often and they have a second question on end Clackamas what are some of the gating factors there to to getting this pivotal trial ongoing. Thank you.
So I'll ask DJ protect the commercial question, Okay, great I'll take that I'll, just quickly mentioned and clackamas background. So.
Yes.
Did a licensing deal with Roche.
Back in 2018, Frank talk a map.
And for back when there was no drug there was simply a master cell bank. So we had to essentially we began the manufacturing and then demonstrate that the product was comparable to the previous product that.
Roche Genentech had had in clinical studies.
And they studied almost 600 patients so referencing back to that data for the I, Indiana clinical safety is important to us, but it takes quite a bit of time to start with a master cell bank and to re scale to.
Commercial scale, which is what we're doing.
So that's really the gating factor is getting all of the manufacturing.
Re done and we have map that out and fully expect that all of that will be behind us and will allow us start the pivotal trial.
In the first half of next year.
Yes, Jackson regarding your first question on hemoglobin levels I don't have hard data for you at this time.
The reason for that is is not only is it kind of early days, but in addition to that we don't collect you know as part of an enrollment into the GBT source any information medical information regarding hemoglobins and that sort of thing we want to keep that information with the clinician and we don't want to slow down the process by collecting that information.
So we don't have that information at this stage of the game, we have to get a different way and the ways that we'll get that and likely be able to hopefully report on it at the Q1 call would be through chart audits and so we'll be doing those chart audits, we'll be getting an idea you know we previously talked about that it wouldn't surprise us if the lower hemoglobin patients.
You know would be initiated a quicker out of the gate for a lot of reasons you know there. They are in the office more often there is a greater unmet need and there's a clear benefit to getting or an urgency to getting hemoglobin raised so it would make sense, but top and I don't have any data for you at this time.
Your next question comes from line of Debjit Deb, Jay Chateau PACU with H.C. Wainwright. Please proceed with your question.
Hi, guys. This Aaron on for Debjit, Thanks for taking the call.
So ill and congrats on all the progress.
So I had that.
Hey, I just had a couple quick questions about.
The physicians.
And their views on how they're seeing.
Hi, there prescribing oxide.
Alongside.
Chris and less than that.
And if there.
If there are designed to sort of segregate patient based on their characteristics are there.
Describing both.
And also could you talk about it.
If they mentioned anything about winning patients off of hydroxy urea.
And how they think that will fit into the picture.
[noise] treatment.
Yes, so we really don't have formal data on that kind of stuff, but I can tell you that this question about using how you would use.
The two new approved drugs.
Came up at Ash and the physician leading the panel immediately said the drugs actually you have different indications.
One drug ox Freida is approved.
To fundamentally trait the molecular base of sickle cell disease.
So it's not a symptom driven treatment, whereas ADAC, though as you know is approved to treat.
Pain crises, so the drug to actually have different labels and I know just from anecdotal experience that positions in some cases.
When pain is the issue are reaching.
Hard to actually appropriately and in many cases those patients are also.
Being directed to treat their fundamental sickle cell disease.
With occupied so I think there will be combination use I know there is already combination you use going on but we don't have actual numbers of patients data at this stage.
I would just to add to that you know this this pull survey we did again, it's it 40 positions. They are specialists other kind of a leading indicator I would say and it was early on we did ask them a how they perceived or combinations and they said about a third of their patients they might use.
I'd Axio inox brighter together so.
We'll see when when the actual data plays out but that was more of a perception.
And with regard to your question about weaning off Hydroxyurea.
We really have never investigative fat and haven't encouraged that I suspect overtime, you will see everything but we've not study.
Weaning, hydroxyurea or Hydroxyurea and really a based upon the held steady results.
Showing that these drugs there combined and work in combination it's really no reason to advocate that a patient who wants to continue to take hydroxyurea wean off of it.
Your next question comes from line of Raj you pursue job with William Blair. Please proceed with your question.
Hi, there any on for rice.
A couple of questions and congrats on the launch progress.
Yes, I was just curious if there was any correlation between the two wells and health care providers. Your sales teams have been talking Q and states, where formulary tepid upgrades I think you mentioned about 70% upscale wells have been targeted so far and then also I was curious if you had.
Other ongoing studies that were examining organ damage.
Okay.
Maybe DJ starting now come back to the organ damage correct. Yeah, I think I think I understand your question. If I don't you you can redirect me, but.
So how we built the sales team is to call on all the top clinicians in in.
Where the bulk of the patients are so certainly the 17 states that make up 85% of the patients.
Our being called on routinely and then the medical science liaisons have have kind of an overlay on the top care wells within those same markets.
So we are actively calling on them as well it and it's not necessarily.
Tied to where the.
When and how the payers come onboard we're actively educating everyone routinely and then the payer team is actively doing their job to get payers onboard and all those different cities and and and states at the same time.
So your second question was about other studies looking at organ damage.
So I'll just remind everyone that blood is actually an organ.
And I think the whole steady has.
Shown that we are preserving the first Oregon.
Of attention in the blood.
The TCD study the hope.
Hi, it's steady.
Is focused on showing reduction of stroke risk we described that already.
The active study is not directly looking at Orkins, but it's effectively looking at the function of organs because.
It will be examining people's physical activity, which could relate to their blood, but it could also relate to their cardiac function. It will also be looking at their sleep. So that will be looking at some of their brain function activity as well and then there are a whole range of other studies that will be doing.
Hi, there as I fts or.
Already as company sponsored studies.
That will be announcing over the course of the year, but there will be a number of studies that will be looking at organ damage or better organ function.
Your next question comes from line of Young Dong with Janney. Please proceed with your question.
Hi, Thanks for taking the questions. So.
About that patient that had talked about on the call you had a hemoglobin increases three.
Grams per deciliter, so I wonder.
How strong is correlation between patients objective experience was the objective measures such as hemoglobin increase and redemption Melissa smokers.
Yeah, we really don't have good data on that but my personal suspicion is that there is not going to be a perfect correlation.
And the reason why is that you could easily improve a sickle cell patients without any change in hemoglobin and the basis for that are several fall.
One is the reality of sickle cell.
He is not normal, though fails or not if formable they cannot transfer for transport through small capillaries and deliver oxygen. So if you simply modify.
The to form ability.
The red cell, which we know occupied it does that data has been presented without any change in hemoglobin you will deliver more oxygen.
In addition.
Fell patients are making about 10 times the number of red cells that you and I make that's an enormous metabolic demand.
You and I are making enough red cells, even though red cells are only about six micrometers. If you want to lineup the red cells coming out of your bone marrow. He would form a line growing at 15 miles an hour. So single cells are making a line of red cells growing at 150 miles per hour. So if you lower the burden of produced.
In Red cells, that's another basis for patients filling better so it doesn't correlate.
Directly but clearly in individual who's got these other benefit in addition to a very dramatic increase in hemoglobin.
As a basis for feeling better, but it's not going to correlate perfectly.
Okay. Then on the active study have you finalize the measures that you're going to use I assume probably more than just keep reduction.
The protocol is not finalized yet.
We are.
Actively working on that with Kao ALS and it will began we expect before the year or so I think we're targeting at the beginning in the fourth quarter.
Okay.
Your next question comes from the line of John Newman with Canaccord Genuity. Please proceed with your question.
Hi, guys.
Good afternoon.
Just wanted to ask a couple of questions here, how much of trying to pull through in the fourth or do you think was from a patient that converted from the expanded access program I'm just wondering how many patients are still in that program.
Yeah, we're actively so what we did with the expanded access patients and there were recall we started the expanded access program. The second half of last year and then we got approval three months earlier so.
We were unable to totally.
Grow the expanded access population.
You know as we had hoped so there aren't that many.
And what we did immediately is contact those sites upon regulatory approval and enroll those folks into GBT source and start working directly with their insurance companies to convert them over to commercial product now.
We also are committed to those patients and others by the way that don't have coverage to keep.
Either provide free drug for a period of time till the insurance comes on board on their case.
He providing a expanded access product to make sure that there they don't gap and therapy. So I don't have hard figures for you right now, but I can tell you that some of those have gotten coverage and others remain on you know free drug Intel until their insurers and that's consistent with kind of all of our patients is that the reason there's a disconnect on revenues and done.
Man in these early days for any launches because you're still working through the payer process that we've talked about and so we'll we'll go ahead and keep those folks on or initiate free drug for a period of time.
And then just as a quick follow up.
Thank you mentioned during the call that CMS reimbursement agreement nationally is in place.
How many of the 17 states that you're targeting have you been able to sit down and talk with subsequent to that national agreement.
Put in place.
Yes, yeah, most of them, we're actively meeting with everyone.
Recall that gets kind of.
[noise], it's kind of a more complex process than that because the states. We're in all the states all the time meeting with the Medicaid fee for service state run Medicaids, but recall that the vast majority of states in the United States have also managed Medicaid partners and they may have 10 to 15 companies running their Medicare Medicaid and so we have to meet with all those come.
And he is as well in each state. So so I can't tell you that.
We've met with all those yet but we're in the process. So that's why it takes a couple of quarters for them to have those medical reviews, and then ultimately their formulary reviews.
Ladies and gentlemen. This concludes today's teleconference. You may disconnect. Your lines at this time. Thank you for your participation.
[music].
[noise] [noise].
[noise].