Q2 2020 Biohaven Pharmaceutical Holding Company Ltd Earnings Call
Gentlemen, and welcome to the bio even pharmaceuticals second quarter 2020 results call at this time, all participants' lines or any listen only mode. After the speakers presentation. There will be a question and answer session. If anyone should require operator, especially during the conference. Please press star zero on your telephone keypad. Please be advised that today's conference maybe recorded.
I would now like to hand, the conference over to while he was chief operating officer Clifford Bechtold. Thank you. Please go ahead.
Good morning.
And thank you and welcome to the second quarter 2020, <unk> earnings call.
[music].
Speaking today.
Our disposal sites because one in today's call is Dr. Black torture, Chief Executive Officer, Jim Inglehart, Chief Financial Officer.
Dave Jones, our Chief commercial officer.
And at least stock are critical medical officer.
This morning, we issued a press release announcing our 20, a second quarter 2020 highlights a copy. This press release can be found on our website at <unk> Dot com.
[music] before we begin.
Today's call a presentation I would like there might be a diverse remarks that maybe made on this call contain forward looking statement subject to risks uncertainties.
In other factors that could cause actual results could differ materially from those expressed or implied.
All forward looking statements made on this call are made based on the beliefs about even as of this they.
Future events or some of the passage of time may cause these beliefs to change.
During this call presenters may make statements about our approved product NERC equity team.
Safety information it both prescribing information for NASDAQ ODP can be found and Nortech dot com.
Well this call really focusing on non-GAAP financial measure with detailed descriptions of GAAP and non-GAAP analysis.
Later in his presentation for more detailed description of the risk we ask that impact. These forward looking statements. Please refer to our most recent quarterly report on form 10-Q, and our annual report on form 10-K.
Please be aware you should not place undue reliance on the forward looking statements we make today.
With that I'll turn the call after that why that's correct.
Your question.
They particularly exciting day for Biovance. This is our first earnings call and the company's first full quarter revenues from the watch I've Nortech OTI too.
This has been an unprecedented quarter in so many different ways, but we are pleased to report the company is excelling in achieving our goal is across multiple areas, including the following.
The launch trajectory of Nortech ODP, it's exceeding initial expectations, we continue to make progress in our clinical trials and have a robust pipeline with the potential to de lever multiple value, creating inflection points over the next year.
The strategic financing of up to $950 million that we announced on Friday leaves us with a strong balance sheet to execute on our long term growth plans as we advance new treatments to patients.
These are extremely exciting times for bio event and our investors.
You'll be hearing shortly from BJ Jones, our chief commercial officer about the details at the launch of Nortech OTI, but I'm happy to state that we had an impressive second quarter commercial performance, despite marching and the mixed global pandemic and multiple entrenched competitors and the marketplace. The launch of Nortech ODP.
It's going exceptionally well and Nortech ODP delivered net revenues and the second quarter of $9.7 million.
Second quarter prescriptions of Nortech ODP had been extremely strong with over 40000 prescriptions.
Bio Haven is now the market leader and new to brand prescriptions for oral see GRP therapies, with 52.6% share and the N.B. Rx network.
The second Submarket oral CGP. This is a tremendous accomplishment for our team and a testament to our best in class product profile to become the new to brand leader approximately one quarter after our launch.
To also post such impressive metrics during a pandemic as a reflection of our company is unwavering commitment to the patience, we serve and our investors I'm. So proud of our commercial team collective efforts and these challenging circumstances.
Yeah.
We now have widespread insurance coverage with our managed market teams, achieving 141 million covered lives representing approximately 83% I've covered commercial lives.
This level of coverage is often the goal that is set for a full year after lunch nevermind after one quarter.
I would like to acknowledge and thank Chris Barrick costs abruptly and the entire managed markets team I'd also like the thanks, Gil Italiana, who runs our global health outcomes group. Our CMO are we stock our CFO, Charlie Conway and of course BJ his leadership for delivering this level of patient access to Nortech.
Oh D. so early in our watch.
Migraine has a large market affecting approximately 40 million Americans and many patients are dissatisfied with the trade off an efficacy and tolerability that they have to make what the older treatments. In this class. This market is seeing new treatments for the first time in decades, and we believe that given the high level of patient and physician.
Patient satisfaction with the efficacy and safety of Nortech ODP that significant growth remains ahead. We're just at the very beginning of the paradigm shift that is occurring in the treatment of migraine with oral CGRP antagonists.
The entire oral CGP market combined currently accounts for only 12% of the market to date.
Underscoring the potential for to make tremendous growth ahead.
We believe that Nortech LGT is a best in class Calcitonin gene related peptide therapy, and its highly differentiated from our competitors, including the following advantages never take ODP. They simple to use oral rapidly dissolving pill with fast onset of action that can return to patients to normal.
Functioning within 60 minutes and provide sustain affects.
Out to 48 hours with a single dose no other Steve GRP oral agent can make those label base claims for the Q treatment of migraine I believe that is why we now have the market leadership and they can be Rx.
With our SMB a submission for prevention. The company is also on track for the potential to be the person dual action treatment for migraine for both acute and preventative properties in a single pill.
Now moving on as many of you know I like to describe I Havent had a modern day pharmaceutical company a company with a relatively small infrastructure that relies on a decentralized organization and fully utilizes the latest technology, including sophisticated sales analytics virtual detailing social media telemedicine and online pharmacies.
Communicate and de lever Nortech odidi to patients we have to continue to innovate with modern media approaches to maximize our relevance share of voice and impact in the market without going we're spending for example, we have implemented industry first campaigns with partners like Hulu, Twitter and IBM Watson, all with a social first mentality where.
We can encourage deeper engagement and sharing across patient networks and everything we do we are connecting with health care providers and patients to drive home. The message that there was an emerging new treatment paradigm for migraine just a few weeks ago. You may have seen our innovative patient focused public relations and social media campaign called take back today feature.
And quite weak or dashing Chloe is the real migraine patients who has helped by Nortech ODC as well as a powerhouse brand spokesperson through her social media presence Chloe and other patients that are featured in our campaign provide a powerful voice to communicate the paradigm shifting profile of Nortech OTI.
We are seeing strong uptake from headache specialists neurologists and high prescribing primary care physicians with the over 10000 health care prescribers.
Recommending nortech ODC today.
Our goal is to make Nordic ODP more widely available to migraine patients around the world and through a disciplined approach to lifecycle management expand the indications of RC GRP franchise, we have engaged health authorities across other major markets to address the veering regional regulatory requirements as our chief.
Medical Officer lease stock will discuss shortly we've established distribution agreements to bring Nortech odidi to Israel and the middle East and we have a wholly owned subsidiary Biogen that will bring nortech ODP to the 80 million migraine sufferers in China. We are committed to the global expansion of Nortech, ODP and expect future regulatory filing.
As for Nortech, ODP in Europe, Japan, and China.
Although we spent a considerable amount of time talking about the successful launch of Nortech ODP and plans for lifecycle development of the seeds RP franchise. Our R&D team that has delivered nortech OTI to the market is already working on multiple other pipeline assets in a similar fashion to bring new treatments to diseases like Alzheimer's disease space.
Cerebellar ataxia owes TD multiple system atrophy and HLS.
We are not reliant upon a single upcoming study for our future value creation, we have a deep pipeline across several indications neurosciences an area of great unmet need for patients, but also requires experienced R&D hands to navigate this traditionally challenging area bio havens pipeline has both low risk opportune.
These and lifecycle management of our CGP platform and higher risk high reward investments in our glutamate and mile approximates inhibitor platforms.
We have multiple pipeline opportunities to deliver treatments for patients and create value for investors.
Even as a strong portfolio a product opportunities and we believe one of the most promising neuroscience pipelines. We believe that we will deliver a best in class therapies for patients and strong growth for investors today and for years to calm we believed that our CRP franchise is on schedule to become a blockbuster.
Yes.
Lastly, we are in a strong financial position to grow the global value of our CGP franchise and pipeline within non equity base financings of up to $950 million that we announced last Friday royalty pharma is investment about a 450 million in the development of is the beds or Pat formally known.
As the but that Japan, and the restructuring of our current debt as well as up to $500 million in financing from six Street will help meet our financially needs as we worked towards reaching profitability with Nortech OTI to.
It's exciting time for bio Haven.
I'll now turn it over to Jim Antal Hart, our Chief Financial Officer to review the detailed results of our financial performance in the second quarter Jim.
Thank you Brad.
Good morning, everyone and thank you for joining today.
First want to echo floods comments on the importance of the two financial transactions, we announced on Friday with royalty pharma and six street.
We've been executing well on both our commercial launch and our robust R&D pipeline financing up to $950 million through these combined transactions strengthens our balance sheet and provides us with the capital continued to grow the company.
I will now provide an overview of our Q2 performance.
This quarter was outstanding both for the company's ability to drive a successful launch of our first commercial product Nortech odidi.
Thank you I've done so during the Tobin pandemic.
We are happy to report strong Q2 results a testament to Nortechs differentiated label as well as our launch preparation and sound execution of strategy.
Our performance demonstrates our operational agility to adapt our plans and best serve patients and HCP is through the unprecedented challenges created by the pandemic.
During this call we will not be providing financial guidance regarding projected revenues spending or earnings as we are still early in our first commercial launch and an uncertain economic environment with the pandemic.
We will be commenting on non-GAAP financial measures supporting schedules in this mornings presentation contain the additional details on both the GAAP and non-GAAP financial basis.
For the three months ended June Thirtyth, we achieved net revenues of 9.7 million on strong script volumes driven by patient demand for Nortech ODP.
We are pleased with the growth trajectory that we saw during the quarter and continue to see in prescription trends.
Continuing down the PNM.
Breast DNA SNA expense in the quarter on a non-GAAP basis was 119.5 million, which increased 103.5 million over the prior year quarter. Our SDMA is primarily driven by commercial investment, including infrastructure advertising and promotional spending to support the launch of no.
Our tech ODP.
Hey, also includes general and administrative costs, including finance legal as well as other administrative functions that have increased slightly to support the operational needs of a commercial organization.
Our Q2 results include investment for launch activities as well as various corporate structure initiatives.
R&D.
R&D investment in the quarter on a non-GAAP basis was 36 million, which decreased 5 million over the prior year quarter.
Primarily due to 7.6 million in regulatory filings to use in the second quarter of 2019, which did not occur in second quarter 2020. This decrease was partially offset by an increase in spending far NPO clinical development platforms.
We also are early stage initiating early stage development in non migraine see GRP indications.
We continue to adhere to a disciplined small company mindset regarding infrastructure investment and to ensure we utilize our spending in a value creation around our pipeline and commercial platform, while enabling a more agile organization. This strategy is proof proven to be highly affected during the pandemic.
On EPS, we reported non-GAAP adjusted net loss for the three months ended June Thirtyth 2020 of 150 million or $2, a 55 cents per share compared to $59.6 million or $1.32.
Centsper share the same period in 2019.
Our balance sheet remains strong with 263.9 million in cash unrestricted cash as of June thirtyth.
Our cash on hand at June Thirtyth, coupled with the 725 million in access capital from our $950 million August 2020, financings as well capitalized and provide liquidity is sport ongoing commercial in development initiatives and our corporate inch infrastructure into 2022.
Our cash used in operations of 175.8 million includes onetime investments for the Nortech ODP launch and development milestones. Our current cash position is sufficient to fund our commercial and development platforms and our corporate it infrastructures into 2022, we are well positioned to continue to invest in the near term.
ODP launch and grow our pipeline.
To sum up we are delighted with how well the nortech ODP launches going and how well our organization performed during a very challenging period right. We remain well positioned with strong product momentum a solid balance sheet and a robust pipeline with that let me turn it over to BJ.
Thank you very much Jim I appreciate it and its pleasure to be here. We do this morning to discuss the progress of Nortech OTI cheese launched today.
As well as our commercial strategy going forward.
Our Q2 launch with a culmination of bio Haven team effort dedicated to building out a best in class commercial organization capability.
The same time, creating the launch readiness plan for what we believe to be a transformative acute treatment for migraine.
This preparation and our ability to adapt quickly as circumstances change allowed us to achieve strong steady increases in prescription since launch despite the unexpected emergence of a pandemic and the expected competition from other recently launched acute therapies, let me provide some additional color.
In mid March after only two days of end market promotion, we were compelled to make the difficult decision to have our field colleagues returned to their homes for the shelter in place orders across the nation is in this context that we launched and particularly t. into the unexpected headwinds of cobot 19 across our industry we face.
Two critical issues.
Access to healthcare professionals was extremely challenging for sales specialists, whether live or virtual as clinicians and office staff struggle to adapt their capabilities in the new reality and access to patients with migraine was restricted for physicians as well as unprecedented lockdowns led.
Patient requests for 30 to 90 day supplies their existing meds instead of newly available products.
Through the commitment in partnership of our incredible employees file Haven integrated team of commercial and medical professionals quickly reassessed, our customer and patient needs to Reprioritize, our plans reallocate our launch investment and execution accordingly.
Our marketing strategy remain sound, but the team quickly shifted to adapt our tactical execution in light of evolving market dynamics.
Within days of restrictions going into effect around the U.S.
Our sales specialists, we're redirecting their efforts to virtual meetings with key customers, while internally, we enhanced an accelerated our digital outreach to each GPS and patients.
We utilized zoom face time phone calls and online media to engage with physicians, while also arranging for remote delivery of samples and co pay cards as for patients, we differentially invested in social media and DTC advertising to communicate with those seeking new therapies while also.
Entering into a collaboration with Kohl's, a pioneering until the medicines that provides specialized care and access to migraine sufferers.
We are pleased to report consistent week over week growth in prescription demand since launch excluding two holiday weeks, resulting in see GRP market leadership, new to brand prescriptions of 52.6%.
With rapid growth of both net tech OE key and the other currently available oral CRP receptor agonist, we have observed significant uptake in what is ostensibly a very large market for acute oral therapies.
To reinforce the point in other disease states, where several companies have competing products and DTC campaigns are prevalent we tend to see an increase in diagnoses treatment and overall class size.
We believe nortechs differentiated profile of a simple to use oral rapidly dissolving pill with a fast onset of action that can return patients to normal functioning within 60 minutes and provide sustained effects up to 48 hours after a single dose.
He is well positioned to become the preferred acute treatment by both physicians and patients and therefore stand to benefit the most.
We have focused our launch strategy on three distinct components one.
Driving healthcare practitioner awareness and trial to activating patients to request Enertec ODP from their physicians in three ensuring access and affordability.
Ill now walk through each of these areas and a little more detail.
First with respect to healthcare practitioners, we have successfully accelerated awareness and product trial, among our targeted physicians to date over 10000 unique prescribers it put pen to paper on behalf of their patients. We are focused on expanding our basic prescribers weekend and we got this ever.
The changing physical access limitations associated with cobot 19 continue to hinder.
Both our reach breadth of HCP is we engaged and frequency the number of times, we engage each individual.
Our sales professionals are committed to ongoing partnership and support of their customers. So the reduced number of Liveengage mint has been offset by an increase in virtual interactions, including peer to peer programs and non personal promotion.
From what we have observed to date, the likelihood of Nortech OTI T. prescribing and positive perceptions of the brand are highly correlated with a number of engagements between the HCP and our sales specialists.
Our ability to flex channels of engagement in real time with our customers enables our field team to provide continuity of support to clinicians and their office staff. Some investors have asked about our continued commercial resilience as the cobot 19 virus surges in various areas.
We built a nimble infrastructure so that our decentralized teams can quickly react to customer then dynamics in real time, which is critical to overcoming such challenges for example, even though July brought a resurgent infection rates across the south in south Eastern States, our local teams address.
Customer needs and remains the fastest geographical areas of prescription growth for Nortech OTI in this demonstrates our ability to continue to deliver strong results, even as the pandemic waxes and wanes across geographies.
Importantly, among HCP is that have tried nortech OTI cheat and other new oral therapies precession tracking research suggests there's a preference for Nortech OATI and this advantage is validated through spherix and other syndicated data, suggesting that one this preference is most evident among headache specialists.
Neurologists primary care physicians referred to.
To the speed of onset and mechanism delivery, which is the orally dissolving tablets or 40 team appear to be the key factors driving these preferences and finally, the positive reception by care wells to our pivotal trial results for preventive treatment of migraine increases our confidence in the venture out.
City of market leadership.
Moving on to the second key tenet of our strategy activating patients.
Our marketing programs have proven to be very successful in reaching pacing.
As Nortech 80 patient awareness remains in line with that of the competing oral see GRP launched eight weeks prior generic nortech OTI in into an open market prior to shelter in place constraints.
Richard direct to consumer media will continue to play a critical role and expanding our trial among patients with migraine.
We believe two more modern and innovative approaches similar to customer engagement strategies leveraged outside of our industry Bio Haven can maintain a competitive share of voice with less capital investment for example, Nortech has been able to achieve the share of voice in the migrant category that is significantly higher than our.
Share of actual spent.
Brought advertising on TV will serve to complement more efficient and targeted digital social and word of mouth campaigns.
Patient engagement has been a powerful component of our marketing strategy in many nortech patients have actively utilized social media to describe the transformative life changing effects from their experiences with Nortech ODC, we call this organic demand and as experienced increases this ripple effects.
We'll continue.
Obviously, nortech will not work for everyone, but it's early responses any indication. We believe there are potentially millions of other patients who stand to benefit like Chloe potash in as Latin mentioned in his opening comments in the cadre of other patients who have ultimately shared their life changing experiences as a result of near.
Check OTI.
The third and final component of our strategy has been ensuring access and affordability.
We have made strong inroads with major payers in the majority of formulary decisions have been finalized with favorable access for Nortech. We have approximately 141 million covered lives to date and significant formulary wins, including CBS Aetna Express scripts Cigna and.
Prime Therapeutics. In addition, we've been able to achieve this broad access with rebate levels inline with our launch forecast.
Patient access to Nortech OE T is extremely important to us and we are dedicated to making enertec OTI widely available to all patients suffering with debilitating migraines.
In closing, we're very pleased we will launch today and I joined led in being extremely proud of our team their collective resilience.
In the face of cobot in their relentless commitment to improving patient lives.
Five months into launch and it's clear that our commercial leaders have driven strong and folks it focused execution of our launch strategy, which has led to nurture equities early success, we drive HCP awareness and trial by meeting physicians, where they are LIBOR remote whatever it takes to educate.
He's on the differential benefits in safety profile or Nortech 40, we activate patients by driving awareness through effective yet efficient DTC in both traditional and social channels, while facilitating organic demand by sharing the powerful testimonials of our patients who.
We have had life changing experiences we undertake no duty and finally, we ensure patient access and affordability by leveraging maritechs compelling data to achieve broad formulary coverage.
These fundamentals are strong and our belief is as cobot receives patient and physician access will open to what appears to be over 85% of an expansive an untapped oral CRP market fueling broad trial and adoption of nurture equity as the acute therapy of choice.
For patients not satisfied with current options.
And with that I'll turn it over to a lease to provide an update on bio havens water pipeline.
Yes.
Thank you BJ I'm pleased to be here. This morning to provide some clinical updates regarding your check ODC, our commercial product as well as what's coming next in the bio even pipeline, which I'm really excited about.
Starting with our cgmp and cabaniss franchise.
And I used the term franchise, because remember Japan is it that Japan and the other see GRP antagonist that we have rights to represent a potential for important expansion both in terms of disease indications and geographical location.
Based on the initial development excess nortech OTI cheap for the acute treatment of migraine the less we've been busy expanding on several market front.
Many of the ex us regions rely on us data package and we've already submitted an application to the acute treatment migraine in Israel and plan on having submissions across other countries and middle East later this year.
Approvals in these countries are expected to start the ended this year through 2021.
We're also moving toward with our development program in China, and Korea with the study starting to supplement that submission later this year.
With regard to Europe, we will rely on our data from both the acute and preventive treatment if migraine and plan on a submission in early 2021.
With regard to regulatory filings in Japan, we plan to meet with the PMTA second half that this year and plan to file for dual treatment, including both acute and prevention asked are performing a bridging study.
In addition to disciplined market expansion, we're moving quickly to advance lifecycle activities.
We recently announced positive results of our phase three remember you can't trial for the prevention of migraine and expect a submission in the U.S. within this year for label expansion.
If successful we will be the only company with a strategy for an oral and do lasting TRP therapy, delivering both acute and preventive benefits in a single pill.
Currently our competitors offer separate drugs for acute on preventive treatment.
The use of two drugs, rather than a single drug across the continuum result in increased healthcare burden.
We believe patients one simple streamlined and easy to use approaches to treat their migraine.
I personally is a physician would prefer the simplicity of using one drugs that could potentially treat both your acute episode and help prevent the next migraine.
Additionally, we will be starting programs in pediatrics and at least one other migraine adjacent indication, which is as of yet undisclosed.
And in addition to geographical and lifecycle management within migraine and it's a Jason season. We are also leading the way for CG RP antagonism non migraine indication.
You've gotten a glimpse into this with our trial intra nasal that Japan to potentially treat pulmonary inflammation associated with cobot 19.
I'm proud of how quickly the bio haven to move forward to initiate a new study with does that Japan for hospitalized cobot 19 patients requiring oxygen therapy.
That study remains underway and we are hopeful that so that Japan will help in mitigating severe inflammatory response, which can be life threatening for some coded patient.
This cobot study was that that Japan is in addition to our study that's Intranasally did that Japan, India acute treatment of migraine, which will have a phase three start by the end of the year.
This study follows a positive phase two study and as a potential to demonstrate even more rapid onset other stacked.
See GRP represents a very important pathway in the nexus between immune and central nervous system, and we will follow the science into at least three other non migraine indications for this franchise over the next year.
Our funding collaboration with royalty pharma and fixed rate is providing important access to resources to bring forward air CRP antagonists to patients with unmet medical need in non migraine indication.
And I'd only just gotten started as we have other drug candidates.
Portfolio that we hope will become just as successful as Nortech ODP.
Lets first talk about our glutamate modulating platform.
Lunate is the most abundant excited Tory transmitter in the brain and we believe TRO really saw will provide important advances in the field across many indication.
We delivered important proof of concept result in both spinal cerebellar ataxia, and obsessive compulsive disorder or LCD.
Our follow on Phase three studies in these areas are utilizing important signals from our phase two proof of concept studies, which we are hopeful will yield positive results.
We'll be meeting with the FDA upper end of phase two meeting regarding LCD into next quarter.
Earlier this year, we discontinued our generalized anxiety disorder program Ghd program due to lack of signal demonstrating really our commitment to continued development of indications and assets only when we believe there signal.
Early this year, we passed an interim analysis.
Hi, Mrcc study and look forward to completing the trial by the ended this year.
We expect topline data by next year for both Alzheimer's disease in the first quarter 2021, and spinal cerebellar ataxia by the fourth quarter of 2021.
Next I'd like to turning to our Milo frocks, todays or NPL platform and other novel targets.
We license for deeper staff from Astra Zeneca, who established themselves as the leader in NPO inhibition technology.
Our Milo proxy dates inhibitor trial in multiple system atrophy aware in rapidly progressive disease received fast track designation by the FDA earlier this year.
This study is ahead of time lines, and we expect topline data next year.
We also recently enrolled the first patients and the mass General Heelys study that is testing this agent in amyotrophic lateral sclerosis or less.
This platform study selected versus forget for staff to be one of the potentially promising new drug candidates to be study.
Lastly, I want to highlight some of our preclinical candidate.
We continue to progress our work on developing a potential first in class inhibitor.
Mattel science team, which is associated with a host of chronic inflammatory diseases.
We will focus on neuro inflammatory diseases, but will also be open to exploring other areas.
We're likewise working NRG greater platform with the development assets that may help to harness the bodys own machinery to eliminate certain circulating protein pathogen that are implicated in a variety of diseases.
So as you can see we have been really busy with our exciting it robust pipeline, it's a real pleasure to be able to share all of this with you and I will now turn the call back to flat.
Thank you ladies gentlemen, VJ in closing, it's only been three years since our IPO and bio Haven as advance our lead asset to approval and commercialization with strong uptake of Nortech ODP, we are turning to lifecycle indications and global expansion of our CGP franchise, we have a robust pipeline includes.
Glutamate modulating and Milo profit Ace inhibitor platforms with three pivotal trial readouts in Alzheimer's disease spine ourselves area taxi and multiple system atrophy and the next six to 18 months the company isn't a strong financial position with the recent strategic financing of up to 950 million.
Dollars and the trajectory of our Neurotech ODP sales, we believe that we are well positioned to deliver on our future long term growth plans from both a commercial and pipeline perspective.
Before opening up to Q1 day, I would like to end by thinking and commending the entire bio haven team for their relentless commitment to patients and safety and advancing our innovative pipeline to patients during this on precedented pandemic.
I would also like to thank all the patients their family members and investigators who participated in our clinical trials to help advanced clinical care in the area of neuroscience, we must continue to work hard to bring novel treatments to patients suffering from diseases that affect the CNS.
Finally, thank you to our visionary investors, who have helped fund our studies and bring Nortech OTI to patients.
We'd now like to open up the call to take your questions operator.
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Thank you. Our first question comes from the line haul Choi from Goldman Sachs. Please proceed with your question.
Hi, Thank you good morning, everyone. Congratulations on all the progress.
Latin team I was wondering if we can maybe just start with a discussion of the share dynamics and specifically.
Given that were coming into late summer early fall can you maybe just discuss what's the status of your 2021 pair of negotiations are and also since any contract and come up for off for your 2021 discussions and then I had a follow up.
Yes, Paul I'll have DJ speak to that but again I just wanted to highlight how successful the team has been and over 83% commercial coverage after a quarters.
Worth of launch quite remarkable metrics and in fact in many cases unprecedented that's usually the goal after one year and you're right. We're already looking towards the future year. So BJ you want to give some more granularity around the future payer interactions absolutely Paul. Thank you very much for the question. It's a good one and clearly we will.
Barry.
A confident in terms of what we've been able to achieve thus far in I will say that many of those contracts actually do extend beyond 20.
And to 21 in some even beyond that so.
There are some who have differential contracts and we're starting to begin those that dialogue now in negotiations, but once again, it's predicated upon the same great profile that we that we have and so those those conversations are going very well also correct.
Probably a follow up as well.
Yes, Thanks, Yes, and then just on some of the international.
Filings I think commercializations that youre talking about can you, maybe just sort of discuss how you're thinking glad about either in terms of business development strategy with respect to partnering and just sort of what you're looking for in terms of potential partners and these international markets. When you might be able to abouts development flare. Thank you and congratulations on all the success.
Yes.
Thanks, Paul and Paul as you know I've, often talked about you have to be ready to run your business on your own. That's your number one priority and then if you do that in the right way there'll be a lot to optionality on partnership opportunities and certainly that's something that we will be looking at for other regions where.
Other potential partners might already have an established commercial footprint, we're not reliance on having to do a deal we are going to run this.
Business on our own, but obviously in markets like Europe, and Japan, and China, there are going to likely be the possibility of partnership in those regions. Thanks, Paul Operator next question.
Thank you. Our next question comes from Charles Duncan from Cantor Fitzgerald. Please proceed with your question.
Thank you for taking the questions blandon team, congratulations and very good launch corridor.
First question is on.
There are tech and the commercial setting and then I had a follow up on the pipeline regarding maritech.
I'm wondering if you could provide some additional color.
Prescriber engagement, both not only in terms of numbers, but also the percentage of target and how has this evolves into third quarter and what will you do if there is a second wave of coated.
And I'm going to turn it over to BJ to give it details on that what I will say is look at weve demonstrated the ability to deliver nortech to patients and what was in a very difficult and challenging time of a full quarantine locked down and I think given that were confident moving forward that we'll be able to.
Work through future challenges, it's not going to be the and as BJ commented, we've already seen where there's been a resurgence as we've been able to continue that commercial growth and so I'll turn it over DJ for some additional veto. Thank you in the question Charles Thanks for that.
As it relates to kind of our our target group of physicians and again, it's we're focused on nooros on headache specialists and on primary care physicians.
Hi, prescribers and we've been able.
Our content, we've been able to achieve retry contact with those four over 80% of those folks even in.
What has been kind of this cold it environment and so.
They are obviously, there's some challenges in terms of a frequency against those conditions, but we feel confident we'll be able to continue to engage them in a meaningful way. The good news is they're also looking for.
How do they operate in what is kind of this new environment and so again, I think where where we have a bit of an advantage is where we're small and nimble and we can flex to the needs of our customer base and so we expect that to continue.
And and getting better in time.
Thanks.
Okay. That's helpful. Thanks for the color on on the pipeline just said a question regarding the prevention clean Sndk forward Nortech I'm not sure it's clear to me, whether or not an actual click on filing has been made and if not you anticipate that by the ended the year.
And then with regard to is that they Japan.
If you could outlined kind of news flow over the course said next 12 months that be helpful. Thank you for taking the questions.
Sure no absolutely so on the Sndk, a we are on our timelines for a.
Filing by the end of the year. So really excited about that we don't view there being any barriers to achieving that with regard to divest Japan now that our funding has been security with the partnership with royalty pharma and Sixthree, we're very quickly be moving to institute the remaining pivotal trials. Our goal is to have topline.
Data by next year, and then to very quickly be able to move for filing for what we believe will be the first CGP intranasally.
Since our out there so thanks Charles I appreciate the question.
Thank you aren't great question comes from the line as Ken Cacciatore from Cowen and company. Please proceed with your question.
Good morning, and congrats on all the progress just wondering on pricing in contracting as we move forward. We obviously can calculate the the value per prescription from this quarter, but flat wondering what our expectation should be as we move forward can you give us a sense of where this may eventually shake out as we try to think about and that value per prescription. Thank you.
Hey, guys. Thanks, Great Great question, So as we've talked about a year one of a new to brand launch with the competitor that we have is a very expensive endeavor. We believes that the high gross to nets. The first one to two years will stabilize and normalize to what we think will be more of a tip.
Buckle peer group gross to net for us oral small molecule.
This year and next year really is all about market share right and then we will focus on profitability thereafter, it's so important in a new to brand launch that get patients on your treatment get physicians familiar with your medication and that will pay future dividends.
As we hit towards the later years. So so thanks for that question Kevin.
Operator next question.
Thank you. Our next question comes from the line of Laura Chico with Wedbush Securities. Please proceed with your question.
Hey, thanks, very much for making time here today. So one quick question I'm glad you mentioned the covered lives 83% covered lives on commercial pretty.
Fast pace, so far I'm wondering if you could also update us on where the progressives with regards to Medicaid state formulary adoption I think you've already had a couple wins there so far but just how should we think about the pace over the remainder of the year and then one pipeline question I just want to make sure im understanding for trillions, all energy to protect it sounds like.
We should be expecting topline data in the first quarter, but can you just or minus kind of what is the regulatory path forward should the data show an improvement in cognition and lastly, how are you thinking about the magnitude of improvement that's clinically meaningful thanks.
Thanks, Laura and be daily Sir.
So I think you Lauren good question and we actually have had done extremely well with Medicaid thus far we're very happy.
When how quickly we've been able to get on contract with many of the states and and we're tracking actually ahead of what our expectations were and and again at up at a rate. If you will write that that is in line with our expectations for launch.
Medicaid.
Medicare It takes it takes more time right and we're in negotiations right now.
Again, we're not behind the timeline in any way shape or form and so we feel very confident about our ability to be able to negotiate and get on those formularies in due time as well.
Great and with regard to the Alzheimers program, where we're very excited for the upcoming top line of the Ti to protect trial as you know we passed an interim futility analysis, which obviously, we derived a lot of encouragement from that however, we all know this is a tough disease and.
The last patient will be treated this year with topline being in the first quarter to answer your question about regulatory path forward really depends on the robustness of that data I will remind you that although this is a and C E and we have full patent protection for 19 years on those compounds the safety.
Package and otherwise, we'll be a fido five be too, which does allowed for some acceleration of filing processes because of that.
And so we will have to wait and see that topline data Lora before I can tell you whether additional studies would be needed or not.
With Alzheimer's so thanks Laura.
Thank you. Our next question comes from Kim Lugo with William Blair. Please proceed with your question.
Thanks for taking my question and congratulations on a fantastic drug launch to date.
Mentioned, a 10000 you'd prescribers for NERC I could give us a sense of how that penetration is as of now and our majority of those prescribers also prescribing the other oil CRP and maybe talk a bit about some of the early experience between those who prescribe books.
Yes, absolutely Ken Thanks for the question and yes, we're we're just north of 10000, or so unique prescribers and I would say you know, it's a good 25% or so of what.
The priority target universe is right for the highest prescribers kind of in this space. Obviously, there's a very long tail as we look at the primary care universe.
We are we're actually encouraged by you know initial prescribing in that space as well and that relative growth and.
We are seeing again, what is a strong police of incremental new riders on a week by week basis and so.
We're encouraged by what use the expansion of that prescriber base.
The color around that again is that what we would expect is actually playing out in which the.
The nooros and the heading specialists are.
Hi, merely the right as they have about 75% or so of prescriptions to date and yes. Indeed, there is the majority of those writers actually do right. Both oral CDR piece at this point in time.
As I mentioned in my earlier remarks, there is some data that tends to show that when folks actually right bold.
But we see.
Bit of an advantage for printer that wouldn't team we are very early I'll say, but.
But so far so good and what we see.
That's great to hear him maybe Q also expand a bit upon the European and Japanese market you know, you're obviously looking at filing to both well can you just give us kind of broadly how meaningful these are in terms of dollar opportunities.
Okay.
Yes, they do represent significant markets and we believe in important part of our global growth expansion.
The assets so we'll be meeting with the P.M.D.A. This year for Japan, and then plan or filing with the EMEA.
Early next year, and then of course, our efforts in China represent another emerging an important growth market for us with their own efforts through bio Shan.
To bring nortech to the 80 million Chinese who suffer from for migraine.
Thanks, Tim Operator next question.
Thank you. The next question comes from Marc Goodman with FCB Leerink. Please proceed with your question.
Yes. Good morning first on the prevention filing can you talk about.
What the gating issue is to a filing just given when the data was when you're filing it just seems like a long period of time and I just don't remember what the issues were.
Accomplished.
Over the course of the year and second.
Talking about gross to nets, a little bit.
Given your accomplishments with the payers, which seemed a lot of it has happened kind of just in the past three or four months I would think that the gross to nets would improve a little bit in the second half for the year. If you could talk about that.
What type of step down do you expect next year and you mentioned after two years you'd expect them to normalize at a level. That's normal for Orals can you just talk about what that level is that something in the fortys is that something in the fifties. Thank you.
Yes, sure I'm happy to talk on the gross and Thats first.
Absolutely, yes. So thanks for the question again, we've been able to negotiate and basically now get on these formula is as we mentioned, but just a reminder for everyone is that those things actually happen.
The majority of them happen as of late July one and as of August one and so there's there's still some time, we're just coming into what would be kind of that better coverage scenario.
If you will and I'll actually turned over to Jim to just the change in to Jim, Yes, Hey, Mark.
Great question, and you're right as as our.
Patients.
Are you get onto formulary there is a shift from the co pay programs, which bear the burden currently.
Over to those air programs, so naturally we can see.
Some near term improvement I Wouldnt can say I wouldn't describe those is as significant.
And then as I mentioned earlier the plan right now is really all about scripts and getting patients on honor Tech and as we get out of the launch phases. When we'll see more meaningful improvements over time, I can't disclose or we won't really guide to what those percentages look like I think she said in the 50 either Sixtys, we we just don't.
Hi, guys to those numbers.
And Mark on the SMB filing for prevention, we are absolutely on our timelines that we don't view there being any barriers to that we've always guided kind of before the end of year and we think it will.
Folks will be happy with the news that we have before the end of the year.
For competitive reasons, we don't release the exact dates thing.
Operator next question.
Thank you. The next question comes from the line of then they'll design from Beazer homes Securities. Please proceed with your question.
Hi, great. Good morning, guys. Thanks for taking my questions here. So first just want to get a sense in terms of the market share as you're thinking about the specialist on things or the market versus the more the primary care I'm assuming overtime. This will turn into more of a primary care type markets I'm, just trying to get a sense. It if you're seeing a difference in terms of uptake so far.
Sort of feedback that you're getting from especially with community relative to what you might be hearing sort of early months around.
The primary care side and then the.
Second question again going back to the year, let me there should international opportunity Im just trying to understand better maybe that you sort of frame the acute opportunity versus the potential opportunity I think theres clearly is beginning to market in Europe, we're seeing injectables.
Going there, but I'm just curious how much of a real commercial opportunities. There is in terms of reimbursement in those kind of thing or acute migraine treatments at this point.
And then I'll turn it over to visit for the first half your question, but just on.
Our strategy ex us and this is why we were waiting for our prevention filing as you pointed out there being much more robust pair environment for that prevention indication ex us, but we have a more novel strategy now that we have the topline data from prevention, our strategies for dual acting.
In all geographic regions outside the U.S. So to go for a filing thats very novel that includes the treatment of migraine, both acute and preventative we believe that novelty.
We'll be viewed as being cost effective for payers ex us and we believe we can get.
Prevention level reimbursement for that the only dual acting agents.
I would it be Jay for the first half.
Yes, Thank you and.
Thus far as it relates to kind of share and is there any differential encompass what the question was between what would be specialists in primary care and this juncture. We've seen essentially is is very strong and gained share in new to brand and then even in Ts were actually now.
Approaching what would be the mid forties in terms of our share there. So very strong growth in primary care side. If you look at the total primary care market, our share would be a bit less but of those primary care doctors that we're targeting we actually see a very similar.
Share so again, we like to saying we believe it's true on exemplified is where we play we win and so we're making sure that we're getting to those priority.
Physician groups and primary care, specifically and so we we will and expect to continue to see relative growth in both both that decision next question operator.
Thank you. Our next question comes from the line of or Rashad with Evercore. Please proceed with your question.
Hi, Thanks, so much for taking my questions I had three if I may 1st perhaps maybe just building up further on the launch progress I was curious if you could speak to.
The vintage cohort of April starts and how many blister packs up they've taken a date I'm just trying to understand what the average duration is looking like a especially from people that started early.
Secondly on ITAR, Japan Phase three from recently would just love to hear your thoughts on how you looked at.
The their data, especially hyper responders and if you could speak to Nortech data as well and then finally on does that Japan I always understood. This as an interim nasal offering.
But based on some recent disclosures it looks like you're developing it doesn't work well. So I'm just trying to understand the positioning relative to nortech, especially given nortech will have on demand and prophy indications. Thank you very much.
Thanks, Thanks, Jim are great questions on the competitor fronts and prevention I think you talked to our competitors are recent release of it totally depends of course, you know everyone has to be careful of cross trial comparisons will say there is if you just plot out the efficacy of all the oral as well as the math agents and prevention I think.
You are going to see.
Somewhat of a similar story and magnitude of effect than what you see changes placebo rates right.
So when you're hitting the target what this teaches US is that you get robust efficacy in if you look at the magnitude of our effect, we had one of the largest magnitude of effects.
In the prevention space and so we're quite a bit encouraged by that but then some differentiation. There is a very different profile on some safety measures such as constipation. As you recall, we did not have any signal for constipation with regards to Nortech ODP and that was very.
Different than at least two of our competitors where thats.
In a a signal that's being picked up I really believe that the benefit from our intermittent dosing.
And giving a differentiated profile there and then also highlight we are the only company with this dual acting strategy. If we're successful with our prevention, we will be the only one that says one pill same dose acute and prevention big differentiation point in the marketplace big win for patients in the simplicity.
As well as payers right you don't have to then pay for two different segments here, Let me give us a lot of opportunity to work with payers to make sure that this approach is accessible to patients and cost effective finally.
That Japan Intranasally is our lead but yes, we're now for the first time kind of talking more about our total program, which is events enhance including an oral version actually we have two different oral versions and we're excited to take that into a number of non migraine indication.
You'll be hearing more about that we won't be giving more detail today for competitive reasons, but the VAT, Japan or program, you're going to see branch out in different directions.
Not just in migraine and pain and so Thats why is at least said earlier, we talk about our CGP antagonists as a franchise. We have so many multiple indications in migraine adjacent sees and iron Mountain migraine and Jason sees as well as multiple compounds and I'll turn it over to BJ for the first half the question, yes, our or thank you for the question as it.
Relates to refill rates, especially what I'll say is for compliance and persistency standpoint, you know, it's obviously is to alert early to access had a long term compliance and persistency trends.
But we don't see any early signs even of those as you mentioned kind of the cohort that started in April on any signs of patients trying their tech and then the banding and choose I can't in uncomfortable sharing exactly within percentages enabled because in was so small as you can imagine.
But we see certainly refill rates in line with launch projections and our expect expectations is that we will see over the course of times, if we kind of reach what would be a quote unquote steady state painful.
Within any given year, we expect the number of subscriptions to exceed that of what you currently see would generics just because the product profile and the type of of.
Really passionate feedback we're hearing from patients as well, but operator last question.
Thank you. Our final question comes from Caravan Cross with Piper Stanley. Please proceed with your question.
Hi, Thanks for taking my question. Yeah. So you recently mentioned that unlike the map market by Haven, and Allergan and they are not competing on price.
Positioning and rebates, but rather on volume. So I was wondering if you could elaborate on that a little bit.
Sure I think.
What we're describing is that.
We both appear to be parity on most formulary and so that allows us actually to compete on the product and obviously each of us have a different commercial a view of our product in the advantages of it.
What we're going to stay focused on our things our competitor can't say, because we have a label base claims that they do not have right. So we have the oral dissolving tablets. We have returned to normal by one out our competitor does not have returned to normal in their label, we have sustained effects to 48 hours.
Our competitor does not have that so they can't say that so we're going to continue BJ and his team to really.
Messaging that differentiated label and we think thats going to cause a growth I also have to acknowledge it's really good for patients to have choice right and by having our competitor and pharmaceutical company like Abbey.
In the market both of US are working hard to educate physicians and patients about the benefits of borrow CJR a piece I think the whole classes gonna grow and as a paradigm shift that's going to occur. There. So we're very excited about that and we're very excited to be working with our competitor to ways right.
Raise awareness here in this space.
Good so I wanted to just end by thanking you all for joining US today, we deeply appreciate the support of our employees and investors as we move forward to deliver life changing therapies to patients. We look forward to speaking with you again soon thank you all very much.
Ladies and gentlemen, this does conclude today's teleconference and webcast. We thank you for your participation and you may disconnect. Your lines at this time.