Q4 2020 Seagen Inc Earnings Call
Good day, and welcome to the CE Gen and fourth quarter and full year 2020 financial results Conference call all participants will be in a listen only mode.
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After todays presentation, there will be of the opportunity to ask questions to ask a question you May press. The Star then one on your telephone keypad.
For all of your question. Please press Star then two please note that this event is being recorded I would now like to turn the conference over to MS. Peggy Pinkston, Vice President of Investor Relations. Please go ahead. Thank you operator, and good afternoon, everyone I'd like to welcome all of the <unk> fourth quarter and full year 2020 financial results Conference call. This afternoon, we issued a press.
The release with our results and that press release and supporting slides are available on our website and the investors section and events and presentations page speak.
Speakers on our call today will be close to Gal, President and Chief Executive Officer Chip Romp Executive Vice President commercial U S. Todd Simpson, Chief Financial Officer, and Roger Dan The Chief Medical Officer.
Following our prepared remarks, we'll open the line for questions. We aim to keep this call to one hour and so ask that you limit yourself to one question to get everyone and opportunity to participate and Q&A during our call today.
Today's conference call will include forward looking statements regarding future or anticipated events and results, including the company's 2021 financial outlook anticipated product sales revenues costs and expenses and potential clinical and regulatory milestones, including data readouts regulatory submissions and approvals.
Actual results or developments may differ materially from those projected or implied in these forward looking statements and.
Factors that may cause such a difference include the difficulty in forecasting sales revenues and expenses impacts related to the COVID-19, pandemic and the uncertainty associated with the pharmaceutical development and regulatory approval process.
More information about the risks and uncertainties faced by sea. Gen is contained under the caption risk factors included and the company's current report on form 8-K filed with the Securities and Exchange Commission on December 29, 2020, and the company's subsequent reports filed with the SEC and now I'll turn the call over to clay.
Thank you peg and good afternoon, everyone. The.
Past year with pivotal and the evolution of our business.
We expanded our geographic footprint and operations beyond the United States, and Canada with presence across greater Europe as we prepare for additional launches of Takeda.
We are now a multi product global oncology company with substantial financial strength to fuel ongoing company investments.
We have laid a strong foundation for continued growth and the ability to bring important medicines to cancer patients in need.
I'll start with the summary of our recent financial performance, we reported record 2020 product sales and our territories of just over $1 billion, reflecting a 59% annual increase.
These results were driven by successful pads have entered kinds of launches as well as continued strong etc sales.
Total revenues were $2 $2 billion, and 2020, which included royalties and collaborations notably our new strategic partnership with Merck.
We ended 2020 with $2 $7 billion, and cash and investments, which strongly positions us to continue advancing our programs.
In 'twenty and 'twenty, one we expect to see continued growth of patch of and to Kaiser and maintained market share for etcetera with anticipated product sales and our territories of approximately $1 $3 billion.
Todd will walk us through our 2021 guidance and chip will discuss the commercial dynamics, but first I'd like to reflect upon the past year.
During 2020, we delivered multiple important business regulatory and development milestones I'd like to provide you with a few highlights beginning with et cetera.
Our partner Takeda gained more ex U S approvals, including in China. Additionally.
Additionally in December we presented data from the echelon, one and echelon two phase III trials at ash, demonstrating robust and durable remissions at five years.
This is a clinically meaningful and important milestone and it <unk>.
Cancer patients' journey.
We are committed to maximizing et cetera patient reach through our clinical development program and Hodgkin lymphoma, and other <unk> expressing malignancies.
Next I'll turn to Pat chef and first in class ADC, and we are developing and commercializing and collaboration with Astellas.
<unk> has shown rapid adoption since its FDA accelerated approval for metastatic euro steel you'll cancer just over a year ago.
And 2020, we announced positive topline results from two pads set of studies.
This included strong data from our single arm phase two trial and CIS ineligible metastatic euro filial cancer patients previously treated with an immune checkpoint inhibitor.
We expect to submit these data to FDA and a supplemental BLA within the next few weeks.
Last year, we also reported topline results from a randomized phase III trial in patients with previously treated metastatic euro steel youll cancer.
Results demonstrated and patch and significantly improved overall survival and progression free survival versus standard of care chemotherapy.
These data will also be submitted to FDA, resulting of two concurrent some supplemental BLA and the next few weeks and.
In addition, global submissions for these trials are planned to support marketing applications and the EU and Japan. Later this quarter also last year, we received breakthrough therapy designation for pads and combination with Keytruda in first line metastatic euro steel the gold cancer, where.
Currently enrolling two trials designed to support approval and first line metastatic patients one to support accelerated approval in CIS ineligible patients and the other to support global approval and patients regardless of platinum eligibility.
Our goal is to redefine first line treatment for metastatic <unk> cancer patients around the globe.
Finally in 'twenty and 'twenty, we made significant headway and exploring earlier stages of bladder cancer.
And collaboration with Astellas and Merck paths of is being tested and two randomized phase III trials, and CIS ineligible and CIS eligible muscle invasive bladder cancer patients.
Now onto to Kaiser.
Best in class her to Teekay I for her two positive metastatic breast cancer patients with and without brain metastasis.
And 'twenty 'twenty two Kaiser was also approved and the United States as well as Australia, Canada, Singapore, and Switzerland under the Fda's project Orbis.
In December we received a positive C. H M. P opinion recommending the European Commission approval of two kinds of in the EU and we are preparing for its potential launch further extending <unk> reach.
Lastly in order to accelerate the commercialization of two Kaiser and regions beyond the U S, Canada and Europe.
We entered into a strategic collaboration with Merck in 2020.
Our three currently approved products are and are important first in class or best in class medicines that have been embraced by oncologists and.
We are making substantial investments and their continued development, which will provide growth catalysts in future years.
We believe that each of the brands have blockbuster potential.
Et cetera is a mainstay and the treatment of CD 30, lymphomas and S achieve strong market penetration and its six indications.
Global sales of ADCETRIS in <unk>, 'twenty, and 'twenty were approximately $1 $2 billion and nearly 83000 patients around the world have received etc therapies.
We expect that the impact of Covid, 19, which is leading to fewer frontline Hodgkin lymphoma, and diagnoses will resolve and time, but this is hard to predict.
We believe that future growth of et cetera will be primarily based on label expansion supported by our multiple ongoing trials and we expect to read out in the next few years.
<unk> has become the standard of care and its current labeled indication.
We expect that both supplemental BLA submissions if approved will further strengthen paths of role and the treatment of patients with advanced metastatic Euro filial cancer.
Looking towards first line metastatic bladder cancer, we expect to complete enrollment in the cohort K accelerated approval trial by the end of this year.
Factoring in a follow up period to observe duration of response data from this cohort could support a supplemental BLA in 'twenty and 'twenty two.
In addition, three large phase III trials are currently enrolling and first line metastatic Europe filial cancer and muscle invasive bladder cancer the.
These trials are intended to serve as the basis for multiple global submissions in the future.
To Kaiser is an important medicine that has been rapidly adopted by oncologists.
We're planning launches in Europe during 'twenty, and 'twenty, one as well as seeking reimbursement approvals on a country by country basis. Additionally.
Additionally, we're conducting several large potentially pivotal trials in breast and gastric and colorectal cancers. We.
We expect to complete enrollment in the mountaineer trial in colorectal cancer patients by the end of 'twenty 'twenty, one while our other studies will continue to enroll.
Building on the success of ADCETRIS with our six labeled indications, we expect headset and Kaiser to reach even more patients and the future.
This is based on our ongoing extensive clinical development programs and Roger will describe in detail.
I'll now turn to our late stage clinical development programs to soda Mab of Dotan also and honest television and the deer, twosome abdomen and known as L Beach yesterday, we and Genmab announced the submission of a BLA for TV and in patients with recurrent or metastatic cervical cancer.
<unk> yet to be our fourth commercial product. This is a significant milestone procedure on and would further expand our commercial portfolio.
We also recently initiated the innovative 301 phase III study in metastatic cervical cancer, which is intended to support global regulatory applications and serve as the confirmatory trial.
Aligned with our goal of addressing the high unmet need for patients with hormone receptor positive and triple negative breast cancer last year, we announced a global collaboration with Merck to co develop and co commercialize L Beach. The collaboration is intended to accelerate the development of L B and focus.
And as on evaluating this highly active ADC as monotherapy and in combination with Keytruda and live one expressing solid tumors.
As we look ahead to 'twenty 'twenty, one and beyond we are focused on three strategic priorities to drive continued innovation and growth.
The first is to maximize the global potential of our three approved medicines group robust clinical development programs and exceptional commercial execution.
The second priority is to advanced late stage programs toward securing approvals for new products, including TV and Lv.
And the third is to expand our our already strong and innovative early stage pipeline through continued leadership and innovation and the ADC space internal R&D investments and corporate development opportunities.
Focusing on these strategic pillars will ensure our organization is aligned to deliver substantial value to our key stakeholders, notably stockholders, our employees and especially cancer patients.
Next I will turn the call over to chip to discuss our commercial activities and Todd will comment on our financial results and 2000 and 'twenty one guidance after that Roger will discuss our clinical development activities and key milestones for the year ahead chip.
Chip.
Thank you play and the commercial team closed out a very successful year with a solid fourth quarter.
Launching two drugs in these unprecedented times was a difficult task.
Through strong digital marketing strategies creativity, and outstanding customer relationships our team delivered.
Successful launches of pads and advocates of drove 59% of total net product sales growth in 'twenty and 'twenty over 2019.
I'd like to thank all Michael local colleagues for their dedication and efforts in 2020 to ensure appropriate patients received on products.
Starting with the ADCETRIS, we reported fourth quarter sales of $164 million.
And $659 million for the year.
A 5% increase over the full year in 2019.
We continue to see and impact on etc sales due to the pandemic.
Based on claims and electronic medical records data, new Hodgkin lymphoma diagnosis trends continue to be approximately 15% lower than historic levels.
We are now promoting the five year follow up data from the echelon one trial in frontline HL and.
And early reactions to these important data have been favorable.
Five year outcomes are and established standard and we expect that the durable advantage of it centers will drive incremental share.
Moving on to the peso fourth quarter sales were $69 million and increase of 11% over the third quarter of 2020.
Full year of paths of sales were $222 million.
We received rapid adoption and our labeled indication and.
And look forward to promoting upon approval.
The overall survival data observed and the EV 301 trial and the strong cohort two data and metastatic Europe year old cash.
Both indications would meet a significant unmet need for patients.
Who have received a prior PD, one or PDL one inhibitor.
Our guidance takes into consideration our high market share and our current labeled indication and.
And evolving market dynamics, such as increasing use of PD, one or PDL, one inhibitors and the frontline.
We are confident that pads of is well positioned this year for continued growth.
Transitioning to the guys.
Fourth quarter sales were $61 million, a 45% increase over the third quarter.
Full year sales of the case of were $120 million, we continue to see adoption of the case of across its strong label and payer coverage continues to be solid we are pleased with the growth, we're seeing and both the community and academic settings.
I will now turn the call over to Todd.
Great. Thanks, chip and thanks to everyone for joining us on the call. This afternoon today I'll summarize our financial results for the fourth quarter and full year and 2020, all been provider of financial outlook for 2041.
Total revenues were $601 million and the fourth quarter and $2 $2 billion for the full year and 2020.
This included net product sales of $294 million for the fourth quarter and $1 billion for the full year.
And this is the first time, we have recorded net product sales of $1 billion and this reflects the substantial growth and now a diverse commercial portfolio, which includes three important drugs.
Royalty revenues were $39 million and the fourth quarter and $127 million for the full year and 2020 royalty revenues are primarily driven by increasing sales of the et cetera by Takeda and to a lesser extent sales of <unk> by Roche and blend rep by GSK and both of which are a day.
Sees that utilize CGM technology.
Collaboration and license agreement revenues were $268 million for the fourth quarter and $1 billion for the full year and 2020, notably the full year of 2020 included $975 million related to the Lv and to kind of the deals with Merck.
Of which $250 million was recorded in the fourth quarter. These.
And these collaborations are significant for the company, both financially and strategically and we will accelerate the development of Lv.
Cost of sales and the fourth quarter of 2020 was $62 million and $218 million for the full year.
This included product cost of sales and royalties for each of our three brands and the paths of profit share to Astellas, which was $32 million and the fourth quarter and $105 million for the full year and 2020.
In addition cost of sales included two to Kaiser related items noncash amortization of acquired technology costs of approximately $6 million per quarter that began in the second quarter of 2020, and a sublicense fee that was paid related to the Takeda license agreement with Merck.
R&D expenses were $216 million and the fourth quarter and $827 million for the full year and 2020.
Growth over 2019, primarily reflected the increased investment across our pipeline aimed at extending the use of our commercial products through expanded labels as well as investment and the development of our earlier stage programs.
SG&A expenses were $158 million and the fourth quarter and $534 million for the full year and 2020.
These are planned increases over 2019 and reflect U S commercialization of pads of and <unk>.
And our European expansion as we prepare for the takahe. The launches later this year.
Regarding the profit recorded for the fourth quarter and for the full year and 2020.
And this is the result of revenue recognized under our two new collaborations with Merck.
Our long term growth strategy continues to remain on investment to maximize the potential of our approved products and and advancing our pipeline.
We ended the year with $2 7 billion and cash and investments, which includes proceeds from the $1 billion equity investment from Merck and the fourth quarter. This.
And this positions us strongly to advance our plans in 2021 and beyond.
Now regarding our 2021 financial outlook I'll begin with revenue guidance.
First we expect total revenues to be and the range of approximately one four to $1 $5 billion. This breaks down as follows.
We expect total product sales to be approximately $1 two $8 billion to $134 billion, which includes the et cetera sales and the range of $675 billion to $700 billion.
Todd said sales and the range of $310 million to $325 million and took heightened sales and the range of 300 million to $315 million.
Clay and ship provided some context around what we envision to be the growth drivers for each of the brands and the near and longer term net.
Next with respect to royalty revenues, we expect them to be and the range of $125 million to $135 million, primarily reflecting sales of the et cetera by Takeda and Thats territory and to a lesser degree contributions from <unk> and blend Rep. Finally collaboration revenues are now.
Primarily event, driven and dependent upon progress by our ADC collaborators we.
We expect these revenues to be less and $20 million and 2021, beginning next year. We expect collaboration revenues will reflect contributions from pads of sales by Astellas and its territories.
I'll now turn to expenses cost of sales is expected to be in the range of $270 million to $300 million. This will be driven by increased product sales across all brands and a higher profit share payment to astellas as a result of higher expected cost of sales.
Cost of sales will also reflect third party royalties owed as well as noncash amortization.
R&D expenses are expected to be and the range of 900 billion to $1 billion per.
Primarily related to two items first investment and clinical trials to expand et cetera.
The seven to Kaiser into additional indications and second increased investment to advance our earlier stage pipeline that includes nine other programs and clinical development.
We believe that these investments are important to our long term growth.
SG&A expenses are expected to be in a range of $650 million to $725 million as we continue to focus on commercial execution to drive growth of our three approved products.
And this guidance also includes the global infrastructure to support the launch of the Kaiser in Europe.
Taken together, our 2000 and 'twenty one guidance reflects both that we continue to see significant opportunity for our approved medicines and.
And that we will continue efforts to develop new medicines for unmet medical needs.
And with that I'll turn the call over to Roger.
Thank you Todd and good afternoon, everyone.
Today I will provide an update on recent progress for our approved medicines and pipeline programs and will outline key milestones anticipated in the year of hedged bigger.
Beginning with ADCETRIS, we presented the important five year follow up data at Ash for the phase III echelon one trial.
Net interest in combination with the Abd resulted in superior long term outcomes when compared to ABVD in frontline advanced Hodgkin lymphoma the.
And the clinically meaningful improvement in PFS has continued since the primary analysis, reflecting the durable benefit seen with good citrus regimen and.
Notably, we also saw fewer second malignancies, and more pregnancies and those who received ADCETRIS plus ABVD versus those who are treated with ABVD and we are pleased with these aspects of the data in the population of generally young patients with him.
Going forward, we continue to see multiple opportunities for ADCETRIS and the advancing trials in Hodgkin lymphoma, <unk> and <unk>. Most recently, we have begun enrolling of trial evaluating ADCETRIS as an immuno of modular three agents in combination with Keytruda and solid.
Turning now to pads is full results from the EV 301 trial and cohort two of the EV two of one trial both conducted in patients with previously treated metastatic <unk> cancer will be presented tomorrow and oral presentations at <unk>.
The phase III, EV 301 day that demonstrated a clinically meaningful and statistically significant and 30% reduction in the risk of death, among patients who received <unk> compared to those who received chemotherapy.
In this new era of frequent checkpoint inhibitor the use for metastatic <unk> cancer and say it is the first drug shown to reduce the risk of death as the patients have received of platinum chemotherapy and checkpoint inhibitor.
<unk> has also shown a clinically meaningful response rates and patients who are ineligible for cisplatin in the metastatic setting and were treated with the checkpoint inhibitor.
EV 301, and <unk> two of one data will be submitted to regulatory authorities this quarter to support the U S and global approvals.
Another key component of our paths of development program is a two pronged approach to support approval in the first line metastatic <unk> cancer patients. We plan to completion enrollment of cisplatin ineligible patients receiving <unk>, plus keytruda and cohort K of the EV one of the three trial.
By the end of this year and if the data are supportive of a supplemental BLA could occur in 2022 after appropriate follow up for duration of response, we continue to enroll patients into the phase III EV 302, global trial, which includes cisplatin eligible patients evaluating pets.
The <unk> plus keytruda compared to the platinum containing chemotherapy ridge.
As we move past it into earlier stages of bladder cancer, we and our partners and this together with Merck recently initiated the keynote <unk> 15 of EV three of four trial to evaluate pad save in combination with Keytruda and cisplatin eligible muscle invasive bladder cancer the.
This trial is in addition to the ongoing trial in cisplatin ineligible muscle invasive bladder cancer patients known as keynote nine O five or EV 303. Additionally.
Additionally, we are also in advanced planning for a trial to examine paths of administered directly into the bladder and non muscle invasive bladder cancer patients.
Lastly, since the launch of pets, and we have continued to monitor the safety of our products and clinical trials and and the post marketing session. As a reminder, Nixon for is expressed in the skin and rashes common but is generally mild and reversible severe rash is how we are of do occur and are described in the current use of prescribing and.
Formation.
So the accutane as adverse reactions, including fatal cases of Stevens Johnson syndrome, and toxic epidermal nickel licenses have occurred in patients treated with pets and the post marketing setting and jury trials with patient safety being our highest priority. We are communicating the occurrence of these rare events viral later today.
And there was the updated recommendations to health care providers, who may treat patients with you of the female cancer.
We are also working with the FDA regarding updates to the U S prescribing information to reflect these events.
And the overall benefit risk balance remains favorable for the use of passive and approved indications headset provides significant benefit and a heightened net need population with metastatic <unk> cancer, which is further supported by our most recent data showing improvement and overall survival in the indicated population move.
On the.
The San Antonio breast cancer Symposium in December two kinds of was featured in several abstracts and key presentation provided new analyses from the pivotal <unk> trial, demonstrating consistent improvements and progression fee survival overall survival and objective response rate, regardless of where the patients with home and research.
The positive.
And the hormone receptor negative.
With regard to our clinical development program. We are excited to the expanding our evaluation of the kinds of into earlier lines of breast cancer treatment and into GI, Kansas to this and we are currently advancing H two kinds of clinical trials of which five of registration of intense.
Now I would like to turn to one of our late stage programs to search and met the dotan.
The women with metastatic cervical cancer, who progressed on first line treatment standard therapies typically have low objective response rates of less than 15% and median overall survival ranging from six to nine months. The innovative two of four trial demonstrated clinically meaningful durable responses with and <unk>.
24% and median duration of response of eight three months and all of the pivotal data included in the recently announced BLA submission, we are motivated and at the prospect of a force approved medicine that could make a meaningful difference to metastatic cervical cancer patients with such a high unmet need.
Moving on to the due to the map of Dotan, we are working with Merck to accelerate the development of the L. D. Both as a monotherapy and in combination with Keytruda and development program includes trials and triple negative and hormone receptor positive breast cancer as well as a basket trial and eight other live on expressing solid tumors.
And we are making progress on optimizing the dose and schedule of Lv and of extended the weekly schedule of evaluation to the combination of <unk> with Keytruda.
Turning now to our earlier stage pipeline, we have in the clinic three novel Adcs, and two of which use out of a dose and payload and full effector function enhanced antibodies using our <unk> technology.
Our most recent of drug to interface. One is on novel ADC SGA and S T.
And B this target silo Thompson Nouveau, a carbohydrate antigen, which is highly expressed across multiple solid tumors.
I would now like to summarize some of the important upcoming milestones that we are looking forward to in 2021, beginning with regulatory we have just submitted the TV BLA and look forward to working with the FDA on the application. Additionally, we look forward to hearing from regulatory authorities in Europe on a two kinds of marketing.
Authorization application and.
And Pat said will be submitted to regulators in the U S Europe and Japan by the end of this quarter moving.
Moving to clinical trial activities, we expect to complete enrollment and the pivotal cohort K of the paths of EV 103 trial and the pivotal to kind of the mountaineer trial by the end of 'twenty and 'twenty one.
We have opened the innovative 301 global confirmatory trial and.
And we have the potential to initiate several of the pivotal trials across our pipeline and 2021. Finally, we plan to have multiple data readouts. This year. This includes data from Lv and multiple phase one programs such as <unk> 40, as well as data from TV and in solid tumors.
Other than the cervical cancer, we also plan to submit multiple <unk> for novel product candidates. During the course of the year I look forward to sharing further details and developments as the year progresses now I'll turn the call back over to clay.
Thank you Roger I'm proud of the remarkable progress we have made and the company over the past year. Despite the challenges of Covid. We have set the stage for <unk> next phase of innovation and execution and the company has never been stronger and better positioned for growth.
We have and expanding commercial portfolio deep pipeline broad geographic footprint powerful partnership and our focused strategy.
And this will turn and increase our ability to reach more cancer patients globally, who need lifesaving therapies.
I would like to thank everyone listening to this call for your continued interest and see Gen and your ongoing support operator. Please open the line for Q&A.
Thank you and we will now begin the question and answer session to ask a question and you May Press Star then one on your telephone keypad.
If youre using a speakerphone please pick up your handset before pressing the keys to withdraw your question. Please press Star then two and at this time, we will pause momentarily to assemble the roster.
And our first question today will come from Ken and Maggie with RBC capital markets. Please go ahead.
Hi, Thanks for taking the question and congrats on the progress and 2020 of what a year.
Maybe just on the the guidance for the Kaiser and for parts of it.
Just wondering if theres anything and you can comment around what the into that in terms of.
Indication expansion of geographic expenditure and of whether that's all upside and Thats just based on the current the invitation. Thank you.
Sure Kevin.
Thanks for the question can you hear me Kevin.
Yep sure Ken Okay, good so to make sure.
You asked questions about the Kaiser and pads up look first of all we're really excited that we have three approved drugs and.
Our launch for both had seven two kinds of has been largely through either largely are all through COVID-19. So we've had to come up with the new way to launch drug.
On pads.
We're now standard of care.
For advanced here of filial cancer patients who've received platinum and the.
PD, one and so we're in very good shape with that we've had great progress chip would you like to give a little bit of.
Color on the guidance and what it what it really reflects true.
Sure Clay so we're monitoring ongoing changes in the marketplace, we're seeing a move of PD, one and PDL one utilization into the frontline, which is in essence of expanded pads of treatable patient population. So that is the key driver for us and 2021 with regard to it the queso and we can.
Continued to see increased utilization and both patients with brain metastases and patients without them. So we're really focused for 'twenty 'twenty, one and promoting the full breadth of the label that we have.
And our next question will come from Geoff Geoff Meacham with Bank of America. Please go ahead.
Afternoon, guys and thanks for the question I just had a couple of quick ones.
Roger when you look at the pad seven and first line opportunity from cohort K.
What's the normal duration of response from chemo that you'd expect and and are there ways to win.
Let's say on an equivalent RR, but perhaps better tolerability.
And then for four of tighter of Chip just also on guidance just wanted to ask how much of a continued headwind from Covid is reflected and is there a way to quantify it or at least tease out which products can be affected thank.
Thank you Jeff.
Jeff Thanks for both of the questions, let's start with.
And Roger talking a little bit about the frontline.
Todd.
The story, where we have actually two frontline trials, but I think Jeff is focused on four K, but Roger you can discuss what you'd like to on that.
Frontline trial basis.
Sure Yeah, Thanks, Glenn and thanks for the question Geoff It's an interesting one so as you know the data we've generated with pets of Keytruda is remarkable. It is of course, a single arm trial, it's 45 subjects, but we have of response rates.
That is substantially better than anything the one could generate with standard of care. The information around so I think our expectation and our hope is that they will they won't be equivocation on on the O. On obviously the data has to play out.
With regard to durability.
What's really important as you know it was when you gave of PD one inhibitor. It's one of the absolute hallmarks of the durability says as high of the ore or is in the data generated states. The long term outcomes such as Jerome durability of response and progression free survival and I wish all of our equally remarkable with standard chemotherapy.
PFS is measured and the sort of seven months period I don't have a specific number for D. O off here because it's not it's not often reported.
But it's hard and again, if we can recapitulate.
Even to a reasonable degree the data we've generated so far I think we'll have a compelling story to tell.
And then on the guidance front with.
No.
Jeff.
Ask it a little bit about headwinds potentially with Covid and certainly.
Every company will be remiss to say everything is perfectly normal.
With Covid there I mean, there was a big article and fierce biotech I think within the last two day is about.
And how oncology clinical trials are 60% down and enrollment.
Ours are are doing well were not 60%.
Certainly understand.
The difficulties of of running clinical trials during the Covid also with guidance you of patients just coming in to get therapy, whether it's first line Hodgkin lymphoma or older patients coming in with for example of bladder cancer. So there is certainly some headwinds, but we've done great I think really getting our exciting.
Of the medicines out.
Right.
Chip would you like to or they'll start with chip and the Todd If you have something you'd like to add would be great chip any thoughts on.
The guidance as per Covid headwinds.
Yeah, well, so it's obviously difficult to predict what's going to take place with the with the pandemic. There's no doubt that it's been a headwind, but I would tell you. The teams have adapted well with regard to of our promotional efforts. We've altered a lot of the digital mix that we have from a marketing standpoint, we're putting an emphasis on on that.
And so we're pleased with the results that we're seeing so far.
Yes, and this is Todd I'll may be at a couple of facts, you know with respect to et cetera. So it's a little bit easier to correlate COVID-19 effect with whats happening in the marketplace Chip has previously talked about and we've talked about for a few calls me all of that we're seeing about a 15% reduction in the diagnosis rate of frontline.
And in Hodgkin lymphoma, we can get to those data through review of the things like electronic Medical Records.
And with drugs like <unk>, and Pat said, it's a little harder to pinpoint the exact causality, but the place point I think we're all experiencing a little bit of payment of Covid now with that and mine I think where all of whom full but we're.
And just about to get behind this thing it's hard to speculate on when that might happen, but we're hopeful that as the pandemic resolves that things will come back to normal.
Okay. Thanks, guys, Thanks, Clay and congrats on all of the progress Thanks, Jeff.
And our next question will come from Cory Kras them off with J P. Morgan. Please go ahead.
Hey, good afternoon, guys. Thanks for taking the question.
And one on pads and with the product on the market for a little over a year now curious if you can tell us more on P and the average number of cycles and youre seeing per patient and the real world kind of how that's evolving.
As well as sort of the latest in terms of and annualized cost of treatment per patient and Roger you mentioned, the the rash that you've seen and you've alert of doctors to that impacting bags and in any material way on that.
On the commercial front. Thank you.
Yes.
Alright, thanks for the question.
And as far as the average cycles that were out there with.
We are I.
And I don't think we've really discussed that and we discuss like how long and general we treat people, but it's really different for a lot of patients.
And the annualized cost so.
And we give them some information on that chip would you like to talk a little bit about.
Roughly the cost per patient with pad seven and clearly this is not on the frontline and this is in the relapsed setting which of their current label. So chip you of any comments on that.
Yes, I do clay. So if I were to just kind of ballpark net net price associated with this reflecting gross to net and the.
Discounts that are given the associated with it would be about 90 day $90000 per patient.
So thank.
Thank you so that's about right and so when people ask me I, usually somewhere in the 90 to 95.
It's about really where we are it depends on the patient and the size et cetera.
On the question you have on the rash.
And we and our initial USPI, we described skin reactions, including some that are severe.
And.
And that's been for us of great target net.
<unk> and four binds to tumors like crazy, especially year of filial tumors and some other ones that we're screening and youll hear more about that about our basket study, but it also buys like almost every antibody and <unk>.
Has some normal tissue crusher activity and so we've known about the skin and you know there are some patients that get rash and we have the section and the warnings and precautions. So the doctors are well aware of what this is and so we call it out and most of the time, it's nothing to write home too much about sometimes it gets.
More severe.
We think that pads have has a very favorable risk benefit and we've shown that true overall survival in the 301 study, which will be presenting the data tomorrow. So thats something really to look forward to and when you see an OS benefit.
And rapid control of the disease.
Have to weigh that against any of the side effects of any drug and we think that doctors are well aware of this are used to using this and.
And.
Uh huh.
Having the.
The side effects that almost every cancer drug has is the goal is really to make sure. The doctors are aware of and to try to put it in the best light so that they could watch it and.
And if theres any anything happening with the patient they could.
They could manage it correctly or whole drug or do whatever they need to and that's the case for all of our drugs because looking at patient safety is number one issue.
And I don't know if that answered your question Roger do you want to put and any thought on this about.
Sure and I think I think.
Always question around does this actually impact duration of therapy I think players made the ride points, which is rash does occur generally mild and transient and.
And you know it does not meaningfully interfere with therapy for these very rare events, obviously, the drug needs to be discontinued so any.
Bad reaction would require just continuation, but the frequency of those events is low so yes.
I don't think we believe that this changes and any way.
The way pets.
And is being used on the length of therapy the debt.
That it's currently use debt.
Okay. Thank you appreciate it.
And our next question will come from Salvia and Richard with Goldman Sachs. Please go ahead.
Good afternoon. Thanks for taking my question and given the guidance per pad Seth. The only includes on label use could you help us understand what the incremental market share will be when the additional indication comes on board or indication come on board this year.
Selling and thank you for the question and.
We have two submissions and the first one is what we called cohort two.
Which is the.
And more frail and weak patients these were of the CIS ineligible patients and.
And then the second cohort of patients.
Sure.
The second store.
The study that we reported as calls our 301 study which of our global study.
Roger can talk about both of those trials and maybe what what.
And what they what they mean, we've put out the top line data tomorrow will be at <unk> and just so happens it's tomorrow, we wish we could tell you more today, but we need to save it for the presentations at the conference.
And by the investigators they deserve.
The right to prevent the so we're sorry, it ends up to be tomorrow, but.
And we'll announce the.
The full day tomorrow, and all of that so look for that and we'll present. This so maybe Roger can give you just a little color about these two trials and then.
Chip you can maybe talk a little bit about what you think would add to market here and manage the balancing what docs to be using off label for what any new label could be doing so Roger you want to start and kind of outlined this should show and so.
The the the randomized trial EV 301 is essentially a recapitulation of cohort one so it's the same population patients who've seen.
And on therapy, followed by the PD one of a PD one inhibitor.
And the important outcome is that overall survival is improved again standard chemotherapy and that standard chemotherapy is obviously suboptimal in terms of the outcomes I think we're really excited by that day that it is complete affirmation.
Of the value the pads have can bring to this population.
And obviously physicians will react differently in terms of level of evidence of those who believe that and overall survival signal is required before using a drug may be compelled by this although we think we already have more than enough.
And the efficacy data to support pets its use with regard to cohort. Two this is the this is a it is a different population that is an older population of more frail population the.
The isn't proportion of patients obviously, who at the time of their initial therapy for metastatic disease.
Deemed cisplatin ineligible it's around about half the population of generally cisplatin eligible and then the decision is made to use a PD one or of PD, one inhibitor, rather than and alternative agents like carboplatin or some of the other chemotherapies. So there is there is a population that really gets treated like that.
And the effectively that PD, one PDL one as a first line treatment.
And then the day that that Youll see tomorrow, and hopefully we'll find compelling does demonstrate the peds and net situation produces excellent response rates and very durable outcomes.
Including overall response and duration of response outcomes. So the exact size of that population I think that'd be quite difficult to define and chip may comment on that suffice to say the checkpoint inhibitors are used widely in cancer and for good reason because they make a difference.
We think that we add meaningfully to the sort of armamentarium for physicians as they manage metastatic <unk> cancer.
Yes.
Okay.
Yes, what I would add to that Roger thanks.
I would characterize this as a smaller segment of the population, but nevertheless on a meaningful number of patients.
And I think it is an important unmet need.
As of could offer once approved and important option for these patients and I think that's what we're looking forward to.
Great. Thank you.
And our next question will come from Matthew Harrison with Morgan Stanley. Please go ahead.
Great Good afternoon, and thanks for taking the question.
Chip I was wondering if you could just comment at all on on what we May expect to see this year from the arbitration or the ongoing Pat.
Patents that you have just in terms of whether you would expect us to hear any resolution of that this year potentially.
So thanks for the question. So there's a lot of work ongoing.
With our legal.
Dispute with the DFS.
I will tell you that and I.
I'll remind you that's a better way to say it and we are not a litigious company.
More of the almost two and a half decades and this is the first time, we've had something like this so and.
And so this is not our goal and wants to really make a difference and the life of cancer patients but.
And we're compelled to defend our IP and.
And our contracts and so there are two things going on one is an arbitration about of contract and one is a patent infringement.
So both of those are in play both of those are very active.
And.
Theres just a lot of legal.
Activity on I'm, not and attorneys I can't describe it all to you, but and it's confidential but.
Is not sitting still by any stretch and so things are moving along well on that.
As you know.
I would I really hope that there is some resolution on this this year, but I can't promise you that I'm not.
I really don't know how fast arbitrators work and courts work.
We certainly would love to see this effort the.
The completed at some point, we feel we have a fantastic case I mean.
Yes, it's a straightforward case and it's something that.
We think that we.
Deserve value and and and.
And.
So, we'll we'll see what happens, but thank you for the question so and.
Please stay tuned as soon as we have something to say.
That you will be announcing it.
Yeah.
And our next question will come from Michael Schmidt with Guggenheim. Please go ahead.
Hey, guys. Thanks for taking my questions.
I think I heard you mention.
The <unk> 40.
One of your earlier stage programs with the update.
And I think we've already seen some interesting early data on your R&D day last year, but just curious if you could help us with expectations in terms of the data disclosure and how that.
Mike.
Sure. It was hard to hear you. So I'll repeat the question for anyone who didn't hear you asked about what we call FCA CD 40, which is a drug that.
Sometimes I just call of <unk> 40, but it is it is not an antibody drug conjugate it is a.
Effector function.
The enhanced antibody true, our SCA technology, which basically.
It's true manufacturing very elegantly and simply it.
It's competitively inhibits the.
The terminal few coast from being added to and antibody and it makes the antibody have some.
Extraordinary properties, which.
Can be really helpful. If youre looking at depleting tumor populations and.
And so it's not an ADC, but it's and empowered the antibody by any other way of looking at it and.
I've talked about it to say that.
Have interest and this and so usually I don't as you know me for a long time I, usually don't bring on drugs that I don't really have interested and and.
Certainly we have developed a number of drugs that haven't made made it past.
Early trials and I think <unk> 40 is a very interesting drug we have committed to presenting data on that this year. So that's where we are on it I really and the data will be in pancreatic cancer, where we've been focused on.
I am excited to complete the work one of the things with pancreatic cancer and if you look historically at pink.
It's been of heart disease to treat a lot of patients don't know the have the disease until they are pretty far along it is different than some of the diseases, which have obvious symptoms that you could see until it's too late so unfortunately pancreatic cancer is a poorly treated disease, it really needs new medicines, and so thats one of the exciting exciting things on.
Because we have such a big interest and making a difference in patients' lives and.
And for a couple of decades now.
<unk> pancreatic cancer has always been a tough disease to treat so we're excited to see if we can make a difference and these patients' lives and the early data and very interesting and I <unk>.
<unk> of one or two calls and I was interested in it but if you look historically, there's a lot of times of pancreatic cancer, where you see some early data and hence and then flow.
Two larger studies and it doesn't pan out and.
So that's something that if you don't learn the lessons of history, you are doomed to repeat them again. So we certainly have learned that we've watched it and so we we.
We took some very exciting.
And exciting early data and we've expanded it pretty dramatically to try to get a really good handle on what.
And what responses are what's the duration.
And maybe even on early way of looking at does this impact of survival. So should see as best as we can.
What the data means and then when we report the data. We also are as we look at the data and and report the data. The question really is what happens next and I'm hopeful that when the data come out the data is robust and it's exciting and we decided to go into a pivotal trial and I don't know yet.
On announcing that we're not guiding but your question was what should we look for Roger do you have any other thing you want to mention about what they should look for.
I think that just to just to sort of repeats.
The scientific the scientific hypothesis testing is a strong one theres good preclinical data.
The combination of a and as CD 40, agonist, which we have had and the clinic, we already have evidence of single agent activity.
And some other diseases, but in this construct we are combining it together with the frontline chemotherapy, which is a.
And Bruce, saying sort of Gemcitabine based chemotherapy together.
And with a PD, one inhibitor and those three intervention and so those are all sort of orthogonal.
Kill the cancer so.
With the with the chemotherapy and.
Stimulates antigen presentation.
With the CD 40, and other things by the way from a mechanistic perspective, and then make sure that the breaks of taken off any of the T cells. So it's a very strong scientific hypothesis.
As clay said with with with.
Enrolled a good number of patients we will wait for the day to read out.
And we will make out of termination at that point, just what are the next steps could be.
Great. Thank you.
Yes.
And our next question will come from Gena Wang with Barclays. Please go ahead.
And that doesn't shut and sat on Tina on behalf of Tina Thanks for taking all of the question.
The two very quick one on the guidance of one of them on pets The Inc.
The prepared remarks, you mentioned that considering the current high their high market share.
Until.
The range at the market share are we talking about like 40% to 60%.
Yeah, Hi, here and another one is on the kind.
That guidance.
And what type of all U S. Revenue are you assuming and this guidance or are we talking about predominantly the U S sales were 2021. Thanks.
Yes so.
Thank you Mike. Thank you for the question look on day one day.
Is the regarding the engine.
On the specifics of market market share of the percentage.
That's not something we usually talk about because once you start going into percentage on every quarter and everyone's asking what's the percentage and all of that and it just is kind of we report our numbers and that's really what's important and so we feel it's standard of care and chip. If you want you can make a comment on the.
The the market share and what doctors think of this and.
And.
With ADCETRIS.
And with the guidance I think I'd like Todd to make a comment on.
You asked the question about outside U S revenue and what's included in guidance. So why don't we start there with Todd Todd why don't you start on the guidance for <unk> share Gena. Thanks for the question. So the vast majority of our to kind of the guidance as U S sales.
And.
We do have approvals and a few other countries under project Orbis and of course, we are.
Looking forward to approvals.
Broadly and in Europe, and starting to do that next year, but the.
The vast majority of our guidance for Takeda is U S based.
Okay, and then on going back and some of the market share and stuff like that chip do you want to give a little color on that.
Yeah. Thanks, Clay, So you know what.
As the standard of care I would say that we're well positioned in 'twenty and 'twenty one.
Two two intersected a very important point and these changing market dynamics I think youre going to continue to see the PD, one and PD L. One and utilization increase and frontline and I think that's gonna put pads that are on a favorable position.
Got it thanks, so much.
And our next question will come from Andy <unk> with <unk>.
Sure.
Okay.
Okay. Thanks for squeezing me and congratulations to everyone at the CCN for a banner year and 2000.
So the other question and kind of early stage bladder cancer the headset.
And it seems like.
You guys basically encroach the poll bladder cancer treatment paradigm everywhere overnight.
In the non muscle invasive bladder cancer.
You know there's been some challenges challenges associated with CCT supply the.
Just wondering for the intra vesicle of use are you looking at.
Beyond these non non.
The non responsive or you're looking at.
Patients who are not suitable for BCG as well just to kind of broaden the opportunity there.
Yes. Thank you for the question.
And we're really excited about Hudson and all aspects of bladder cancer and like you say, whether its metastatic muscle invasive where we have a lot going on and as Roger talked about and our next on.
The next area that we're going after is non muscle invasive, but we've done a lot of work on there we haven't started the trials yet.
Well aware of the BCG challenges Roger do you want to give a little color on the intravascular use of what we're thinking.
Yeah, So Andy.
It's a great question. Obviously, we are just beginning and we haven't disclosed any of the clinical trial plans, but we are as we sit and prepared remarks, we are on advanced planning.
We think the profile of competitive.
And could be very favorable based on minimal systemic exposure and the activity directly into the bladder.
The place to start as you say for all programs and BCG non responsive.
But if we if we find peds is active.
In the population, we would we would obviously.
Move on or make plans to move into earlier lines of therapy again, it's a it's a balance of how much benefit can we bring versus how much.
And our risk do we do we bring to bear on the on the circumstance and and.
Until we have generated the day that we won't know, but I continue aspiration of Lee.
And would like to have pets of position, if we can and non muscle invasive bladder cancer wherever it's appropriate.
The address the unmet needs.
Okay. Thank you very much.
And our next question will come from Andrew Berens with SVP of S. B B Leerink. Please go ahead.
Hi, Thanks.
I was wondering if theres the potential for increased rates of increased severity of skin rash when youre paths of checkpoints versus perhaps of alone.
Thank you very much for the question on net.
We're in trials out as you know Roger can you.
Comment as to we have some data that's actually been presented on this but.
Ongoing trials and perhaps talking about anything we've seen in the on and the data that was that it would be fair game Roger.
Sure.
So and as you know we believe we're confident in and we believe that the combination of pet sales.
Plus keytruda has tremendous potential in bladder cancer, not just in metastatic, but and the and the muscle invasive circumstance as well.
And there is lots of scientific reasons to believe that of adult and based ADC, maybe particularly.
Powerful when it's combined with the PD one inhibitor.
From a safety perspective, obviously, all clinical trials that we run we monitor the safety carefully.
And no changes to any of our plans with regards to what we are doing and all clinical trials. The data we presented to date, which is around 45 subjects. We did report overall skin rashes, and and great <unk> and such.
Roger I just lost here you can you guys hear me.
Yes, I think it's really down.
Yeah, Okay, well, we lost Roger so.
Yeah.
Andy are you still on.
Yes, I'm still here.
Did you get enough of an answer from Roger.
I think he was just about the talk about the data and the 45 patients so well unfortunately.
Yes, so Roger and got cut off.
Our data and the patients did not show anything that was that.
Net.
It was obvious to us Adobe of problem at all affected it shows the opposite of showed that the.
The patients.
And did incredibly well on the two drugs together and we got breakthrough designation and.
We're been enrolling a lot of patients and both of the accelerated trial and the global trial, and so where we sit now we're pretty darn excited on this and.
I don't know any reason that we would be inhibited from going forward. If that's what you're looking for.
No I was more interested and just as if the rash is worse or more frequent on it.
Could it be more of a commercial issue, yes, we have not seen that.
And in the trial that we.
Presented on we have not seen that.
Okay.
Goodbye.
And the potential limitation and commercial with the combination at this point obviously, that's why you do Big studies and your study so what the fee and the future but for what we've seen to date, we see no issue with going forward commodity.
And thank you.
Taken up very well I mean, it's really it's really exciting to see of drug becomes standard of care in the metastatic setting of pretty quickly.
Yes.
And our next question book of operator, we have time for one more question.
Absolutely and that question will come from Jay Olson with Oppenheimer. Please go ahead.
Oh, Hey, congrats on all of the progress and thank you for the update I. Appreciate your three pillared strategy and wanted to ask you about your plans to maximize the global potential of your portfolio, which you have traditionally done through partnerships outside the U S and now since Youre building of two kinds of the team in Europe do you envision eventually building of <unk>.
Global infrastructure and taking your early stage pipeline all the way from development through global registration and commercialization independently.
And Jason first of all thank you for the question and thank you for noticing and we have expanded.
And on the backs of to Kaiser and the back of <unk>.
Include greater Europe, which is quite a lot of countries. So and our team. There is just ready to go we're really excited.
And to start getting this out the patients you need and working with docs and all of that so hopefully that soon.
But as far as the future paths there.
I would say is it depends.
Don't mean to be ignoring your question. It is not that easy for U S biotechs or for that matter U S farm and sometimes to do a lot of work.
And let's say of certain parts of Asia, especially the two biggest markets, Japan, and China and so it is something that we're looking at closely as to what we would do with with additional drugs and whether we would consider putting.
And Asia for instance, at some of the big markets and.
And so that's something we're talking about I don't want to tell you, yes, we're going to do it or no. We do have great partners. We know all of the best.
The partners and distributors and different territories, and whether we want a partnership for distribution is something you have to look at everywhere, but I'm really glad that we're going.
The broader and a.
Commercial way and.
And hope as part of our pillars that we continue to broaden out our global reach.
Great and Super helpful. Thank you.
Okay.
And this concludes the question and answer session I would like to turn the conference back over to management for any closing remarks.
Okay. Thank you operator, and thanks, everybody for joining us. This afternoon, we look forward to staying in touch and hope you are of good evening.
<unk>.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.
Okay.
Okay.
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