Q2 2021 Exelixis Inc Earnings Call

Franzy: Good day, ladies and gentlemen, and welcome to Xelux's second quarter 2001 Financial Results Conference Call. My name is Franzy, and I will be your operator for today.

Good day, ladies and gentlemen, and welcome to ask Alexis second quarter 2001 to 1 financial results Conference call. My name is frenzy and I will be your operating third parts of the day as a reminder, this call is being recorded for replay purposes, I would now like to starting to fall over a day.

Susan T. Hubbard: As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to your host for today, Ms. Susan Hubbard, Executive Vice President of Public Affairs and Investor Relations. Please proceed. Thank you, Franzy, and thank you all for joining us for the X-Alexis second quarter 2021 Financial Results Conference Call. Joining me on today's call are Mike Morrissey, our president and CEO, Chris Center, our chief financial officer, and PJ Haley, our executive vice president of commercials, who will together review our progress for the second quarter of 2021 and on June 30th, 2021.

Your whole person day, Mrs and how Bruce <unk> Executive Vice President of Public Affairs and investments My Investor Relations. Please proceed.

Thank you Brandy and thank you all for joining us for the economics of the second quarter of 2021 financial results Conference call. Joining me on today's call are Mike Morrissey, our president and CEO, Chris Senner, Our Chief Financial Officer, and P. J Haley our executive Vice President of commercial who will together review our progress for the second quarter of 2012.

And 1 ended June 30th 2021.

Susan T. Hubbard: Peter Lamb, our chief scientific officer, is also here and will join us for the question and answer session following our performance. I'm a character. During the call today, we will refer to financial measures not calculated according to generally accepted accounting principles.

Peter Lamb, our Chief Scientific Officer is also here and will join US for the question and answer session. Following our prepared remarks.

During the call today, we will refer to financial measures not calculated according to generally accepted accounting principles. Please refer to today's press release, which is posted on our website for an explanation of our reasons for using such non-GAAP measures as well as tables deriving these measures from our GAAP results.

Susan T. Hubbard: Please refer to today's press release, which is posted on our website, for an explanation of our reasons for using such non-gap measures, as well as tables deriving these measures from our gap. During the course of this presentation, we will be making forward-looking statements regarding future events and the future performance of the company. This includes statements about possible developments regarding discovery, product development, regulatory, commercial, financial, and strategic matters. However, actual events or results could, of course, differ materially.

Susan T. Hubbard: We refer you to the documents we file from time to time with the SEC, which under the heading risk factors identify important factors that could cause actual results to differ materially from those expressed by the company. verbally and in writing today, including without limitation, risks and uncertainty related to product commercial success, market competition, regulatory review, and approval processes, conducting clinical trials, compliance with applicable regulatory requirements, our dependence on collaboration partners, and the level of cost associated with discovery, product development, business development, and commercialization activities.

Susan T. Hubbard: And with that, I will turn the call over to Mike. All right, thank you, Susan, and thanks to everyone for joining us on the call today. X-Alexis had a strong second quarter across all segments of our business as we grew the combo medics franchise and advanced our pipeline of promising early stage programs. The company posted record Kobosantan franchise net product revenue and total revenue in Q2, based on strong demand for the Kabomedik's Nivolomab combination across all segments of the first line RCC market.

Michael M. Morrissey: Syndicated market research highlights that Cato and Nilo-Dublet play a leading role in first-line RCC and reflects the strength of the efficacy, tolerability, and quality of life data from the Checkmate 9-A-R trial. We maintain significant momentum with a 59% year-over-year growth in Cabo net product revenue in the second quarter, 2021, compared to the same period in 2020. Our goal remains to exit 2022 with a $1.5 billion annualized run rate for RCC in the U.S. Ex-XX also advanced key 2021 discovery, development, and regulatory activities in the second quarter.

And reflects the strength of the efficacy tolerability and quality of life data from the checkmate 90 or trial.

We maintain significant momentum with a 59% year over year growth and cargo net product revenue and the second quarter of 2021 compared to the same period in 2020.

Our full remains to exit 2022, with a $1.5 billion annualized run rate for RCC and the U S.

<unk> is also advanced key 2021 discovery development and regulatory activities and the second quarter, we reported topline results for the combo. It has a double it and first line HCC from cosmic through 12, and and metastatic crp's from Cosmic O..2 1 cohort 6.

And will update you on regulatory feedback and details for upcoming presentations for these 2 trials in due course, we plan to final new Sn Da's for cargo and these indications pending positive regulatory feedback along with the submission of cosmic 311, and DTC, which was accepted for priority review with the.

Michael M. Morrissey: We reported top-line results for Cabo-Ezzo Doublit in first line HCC from Cosmic 312 and metastatic CRPC from Cosmic 021 cohort 6, and we'll update you on regulatory feedback and details for upcoming presentations for these two trials in due course. We plan to file new SNDAs for CABO in these indications, pending positive regulatory feedback, along with the submission of Cosmic 311 and DTC, which was accepted for prior review with the PDFA date of December 4th, 2021.

<unk> date of December 4th 2021.

The full portfolio of late stage cosmic and contact trials with Cabozantinib ICI combinations continues to move forward. According to plan.

Our early clinical pipeline is advancing with significant progress and the XO overnight and to program. The ex 1 or 2 phase 1 trial and the initiation of clinical work with ex B O O..2 our first biologic to enter the clinic.

Michael M. Morrissey: The full portfolio of late-stage Cosmic and Contact Trials with Cabo Xantinib ICI combinations continues to move forward according to plan. Additionally, our early clinical pipeline is advancing with significant progress in the XL-092 program, the XL 102 phase one trial, and the initiation of clinical work with XB-O-O-2, our first biologic to enter the clinic. The X-lexus Discovery and preclinical teams continue to optimize and characterize new development candidates for both small molecule and ADC programs, which we believe will provide the foundation for new clinical candidates in the near future.

Michael M. Morrissey: And finally, we measure success by the number of patients that derive benefit from the drugs that we discover, develop, and ultimately get approval to market. We currently estimate that more than 20,000 patients are treated quarterly with Kauzaninib on a global basis. While we're proud to have achieved this magnitude of impact on people with cancer, we strive to excel at an even greater level every single day with CAVO across existing and new indications and their emerging pipeline of drug candidates in clinical and preclinical evaluation.

Michael M. Morrissey: With that, please see our press release issued an hour ago for our full second quarter financial results and an extensive list of key corporate highlights detailing our accomplishments in the quarter. I'll now turn the call over to Chris, who will review our second quarter 2021 financial results and provide an update to our full year 2021 financial guide. Thanks, Mike. For the second quarter of 2021, the company reported total revenues of $385.2 million. Total revenues for the quarter included Cabo Xantitive franchise net product revenues of $284.2 million.

1.1 million or <unk> 30 per share on a fully diluted basis for the second quarter of 2021. The company also reported non-GAAP net income of $117.9 million or <unk> 37 per share on a fully diluted basis.

Non-GAAP net income excludes the impact of approximately $21.8 million of stock based compensation expense net of the related income tax effect.

Cash and investments for the quarter ended June 32021.

It was approximately $1.7 billion.

And finally, turning to our financial guidance for the full year of 2021, we're updating our financial guidance for total revenues net product revenues R&D expenses and year end cash provided earlier this year.

We are increasing our total revenues guidance, which we now expect we and the range of 1.3 and $1.4 billion due to higher net product milestone and R&D reimbursement revenues.

Chris Shibutani: Net product revenues in the second quarter of 2021 were impacted by higher demand for Cabo Medi. Cabobetics hostseller inventory increased in line with the change in demand and resulted in stable inventory weeks later. Total revenues also included $100.9 million in collaboration revenues from Ipston, Takeda, and Genente. Our total operating expenses for the second quarter of 2021 were $262.2 million compared to $274.8 million in the first quarter of 2021. R&D expense was the primary driver that decreased total operating expenses, which was primarily related to lower clinical trial and licensing expenses.

We are increasing our net product revenues guidance.

Which we now expect me and the range of 1.05 and $1.5 billion.

Research and development development expenses are increasing due primarily to higher forecasted licensing expenses and are now expects me and the range of $650 and $700 million.

Which includes noncash expenses related to stock based compensation of approximately $45 million.

And finally, we are projecting cash and investments to be and the range of $1.7 and $1.8 billion at year end 2021. This guidance does not include the impact of any potential new business development development activities, which remains a key priority for the company.

And with that I'll turn the call over to P. J.

Thank you Chris today, I will discuss the <unk> business with regards to Q2.2021, particularly in the context of the first full quarter. After the approval of <unk> and combination with and immune checkpoint inhibitor.

As you know on January 20 <unk>.

<unk> received FDA approval for use in first line RCC and combination with noble and map.

Following the approval of <unk> first line market share has grown significantly driven by broad uptake in the marketplace.

Chris Shibutani: Provision for income taxes for the second quarter of 2021, or $28.8 million compared to a benefit of $3.6 million for the first quarter of 2021. The company reported Gap net income of $96.1 million, or 30 cents per share on a fully diluted basis, for the second quarter of 2021.

And the second quarter <unk> was the number 1 prescribed <unk> and RCC.

We are pleased with the growth of the Cabo Med ex first line combination new patient market share, which according to a <unk> brand impact has grown steadily since approval.

As you can see the average new patient market share of Cabo medics and combination with new volume App in Q2 was 28%.

According to the data the Cabo <unk> combination has taken share from other ICI combinations as and accrete and has increased the penetration of ICI combination therapy within the first line RCC market.

Chris Shibutani: The company also reported non-gap net income of $117.9 million, or 37 cents per share on a fully diluted basis; non-gap net income excludes the impact of approximately $21.8 million of stock-based compensation expense net of the related income tax cash and investments for the quarter ended June 30th, 2021 were approximately $1.7 billion. And finally, turning to our financial guidance for the full year of 2021. We're updating the financial guidance for total revenues, net product revenues, R&D expenses, and year-in cash provided earlier this year.

Chris Shibutani: We're increasing our total revenues guidance, which we now expect to be in the range of $1.3 and $1.4 billion due to higher net product, milestone, and R&D reimbursement revenue. We're increasing our net product revenue guidance, which we now expect to be in the range of $1.05 and $1.15 billion. Research and development expenses are increasing due primarily to higher forecasted licensing expenses and are now expected to be in the range of $650 and $700 million, which includes non-cash expenses related to stock-based compensation of approximately $45 million.

Very positive.

There's been a rapid increase and unaided awareness of the approval of this combination as well as favorable impressions of the efficacy of the combination based on the and points of overall survival progression free survival and objective response rate across key subgroups, including <unk> risk categories.

Patrick J. Haley: And finally, we are projecting cash investments to be in the range of $1.7 and $1.8 billion per year and in 2021. This guidance does not include the impact of any potential new business development activities, which remains the key priority for the. And with that, I'll turn the call over to Chris. Thank you, Chris. Today I'll discuss the Cabometics business with regard to Q2 2021, particularly in the context of the first full quarter after the approval of Cobbometics in combination with an immune checkpoint inhibitor.

Importantly, the safety profile of the combination driven by the optimized Cabo combination starting dose of 40 milligrams daily is viewed favorably by prescribers and is improving overall perceptions of the safety and Tolerability of Cabometyx.

Physicians also view the quality of life benefit demonstrated and 90 R. As differentiating and important for their patients who may be on first line therapy for extended lengths of time.

Ultimately, the totality and balance of the efficacy and overall survival safety and Tolerability and quality of life data is viewed positively by prescribers.

Similar trends are seen and the prescription data from Cuba, which demonstrate and inflection point this year and cabometyx demand.

The growth is driven by both new and refill prescriptions from the 90 or launch and resulted and an increase of 28% growth and the first half of 2021 relative to the first half of 2020.

Patrick J. Haley: As you know, on January 22nd, Cabometics received FDA approval for use in first-line RCC in combination with Nevolumatic. Following the approval, Cabo-Matic's first-line market share has grown significantly, driven by broad uptake in the marketplace. In the second quarter, Cabometics was the number one prescribed TKI in RCC.

As I mentioned previously the growth is being driven by first of all and combination uptake while the second line market share for Cabometyx remains stable.

With regards to new prescriptions and.

And our ex increased significantly and the first half of 2021 relative to the first half of 2020 at a rate of 29%.

Patrick J. Haley: We are pleased with the growth of the CaboMedics first-line combination new patient market share, which according to Acuvia brand impact has grown steadily since approval. As you can see, the average new patient market share of Kabometics, in combination with Nevolamap, in Q2 was 28%. According to the data, the Cobbometics combination has taken share from other ICI combinations and has increased the penetration of ICI combination therapy within the first line R

Cabometyx and Rx were stable and Q2 to 2021 relative to Q1, despite the overall cis's b and our ex market basket being down 5%.

That said, our internal data for new patient starts shows larger increases for both these time periods comparisons, but we won't be sharing specifics of that data for competitive reasons.

The success of the Cabometyx launch and combination with Nivolumab is changing the mix of patients on Cabometyx and RCC.

First of all and combination usage has increased the proportion of the new capo prescriptions that our first line.

Patrick J. Haley: As you know, the median duration of therapy for patients in the Checkmate 90R study was approximately 1.5 years, so we believe that these new patient starts will drive demand growth for many quarters to come. We are also pleased that adoption was broad across a number of key segments with strong uptake in favorable, intermediate, and poor clinical risk groups, as the 90R data is resonating with physicians broadly as they think about patients who are appropriate for the regimen.

Given the clinical data from the Checkmate and 90. Our study we anticipate these first line combination patients to receive their therapy for approximately 1.5 years or more thus driving a longer treatment duration for cabometyx.

We are encouraged by the fact that and our data, we see and near doubling of the amount of new patient starts at the 40 milligram dose relative to the same period last year. This is further indication that the combination uptake and the first line setting is robust.

1 other point to note is that the proportion of Cabometyx third line patients declined and our third line market share has decreased as many third line patients have already received cabometyx.

Patrick J. Haley: Furthermore, our market research shows that Cabometics, in combination with Nevo, is taking share from all first-line competitors; uptake in the academic segment has been rapid, as the market share for Q2 in this segment was 35%, according to Brandon. Adoption in the community setting typically lags the academic setting following a launch.

And looking at the market basket for RCC TK eyes cash.

<unk> was the number of and prescribed <unk> and Q2 and TR ex market share increased to 38%.

The tiara ex CSP market increased in volume by 5% and Q2 over Q1, and Cabometyx TR ex volume grew by 13% and the same time period.

Patrick J. Haley: That said, we are pleased by the increase in market share in the community from 11% in Q1 to 25% in Q2, and we believe that Cabometics, in combination with Novolumab, has the opportunity to continue to grow new patient market share, particularly in the community segment. In addition to the broad uptake of Kabomedics plus Novolam in the marketplace, perceptions of the 90R data have been very positive. There has been a rapid increase in unaided awareness of the approval of this combination, as well as favorable impressions of the efficacy of the combination based on the endpoints of overall survival, progression-free survival, and objective response rate across key subgroups, including IMDC risk categories.

The increase and Cabometyx share and volume was driven by uptake of Cabometyx and combination with and the global Nab and the first line setting.

In July and.

And CCN updated their kidney cancer guidelines, and now cabozantinib, either as mono therapy or and combination as a preferred agent and every setting and RCC, regardless of clinical risk groups line of therapy or disease histology.

This will support the strong and focused execution that the <unk> team is putting forth and the 90 or launch and RCC more broadly.

The strong Q2 performance and Cabometyx launch trajectory position and Cabozantinib franchise to continue significant revenue growth and 2021 and beyond.

We're thrilled with the opportunity to 90 or provides ex lexis looking forward as we continue to build upon the foundation and RCC, where cabometyx as and number 1 prescribed PKI or.

Our team remains highly focused and motivated to compete every day to bring the benefit of Cabometyx to all eligible patients as we continue to build the franchise and maximize potential and with that I'll turn the call back over to Mike Alright. Thanks, PJ as you heard on the call today, and we had a great second quarter with both record Cabozantinib franchise net Prada.

Patrick J. Haley: Importantly, the safety profile of the combination driven by the optimized Cabo combination starting dose of 40 milligrams daily is viewed favorably by prescribers and is improving the overall perceptions of the safety and tolerability of Cabo medic.

Revenue and total revenue, which led us to update components of our full year of 2021 and guidance. We're excited about the potential of our work, including the ongoing cabozantinib pivotal trials the growing clinical development program per XL O 9 to and are rapidly maturing early stage pipeline as we advanced and our mission to help cancer patients recover strong.

Patrick J. Haley: Physicians also view the quality of life benefit demonstrated in 90R as differentiating and important for their patients who may be on first-line therapy for extended lengths of time. Ultimately, the totality and balance of the efficacy and overall survival, safety, and tolerability, and quality of life data are viewed positively by prescribers. Similar trends are seen in the prescription data from Cuvia, which demonstrate an inflection point this year in Cabomedic's demand.

<unk> and live longer.

As we previously announced darted useless Schwab, our president of product development, and Medical Affairs, and Chief Medical Officer began a medical leave of absence and June we're grateful that she continues to engage and advise us during her leads.

For more than 15 years <unk> has been deeply committed to our mission and the patience. We serve frankly ex lets us would not be the company Norwood complaisance and to be the drug that they are today without her passionate and tireless leadership, we simply can't think keesler enough for her countless contributions over the years, including per commitment to the <unk>.

Patrick J. Haley: The growth is driven by both new and refill prescriptions from the 90R launch and resulted in an increase of 28% in the first half of 2021 relative to the first half of 2020. As I mentioned previously, the growth is being driven by first-line combination uptake, while the second-line market share for CaboMedics remains stable. With regard to new prescriptions, NRX increased significantly in the first half of 2021 relative to the first half of 2020, at a rate of 29% Khabometics NRX were stable in Q2 to 2021 relative to Q1, despite the overall CISV NRX market basket being down 5%.

Interest shift and professional development of her team.

We're all extremely proud of how the entire development organization has pulled even further together to keep our and many programs on track. During her absence. We are now actively searching for our next CMO and hope to have that person on board and the near future.

I'll close by taking the entire ex <unk> his team for their individual and collective efforts during a busy and productive second quarter.

<unk> has widely embraced the data supporting the efficacy and safety of the COVID-19 vaccines.

Patrick J. Haley: That said, our internal data for new patient start shows larger increases for both these time period comparisons, but we won't be showing specifics of that data for competitive reasons. The success of the Cabometics launch combination with Novolam is changing the mix of patients on CaboMedics and RCE. First-line combination usage has increased the proportion of the new Cabo prescriptions that are first Given the clinical data from the Checkmate 90R study, we anticipate these first-line combination patients to receive therapy for approximately 1.5 years or more, thus driving a longer treatment duration for Cabo. We are encouraged by the fact that, in our data, we see a near doubling of the amount of new patient starts at the 40 milligram dose relative to the same period last year

Patrick J. Haley: This is further indication that the combination uptake and the first line setting is robotic. One other point to note is that the proportion of Cabometic's third-line patients declined, and our third-line market share has decreased, as many third-line patients have already received cobometic, and looking at the market basket for RCCX, CaboMedics was the number one prescribed TKI and Q2, and TRX market share increased to 38%. The TRX, CISV market increased in volume by 5% in Q2 over Q1, and CaboMedics, TRX volume grew by 13% in the same time period. The increase in Kabometic share and volume was driven by uptake of Kabometics in combination with Nab in the first line setting.

P J.

I mean really looking at the comparisons we have of 28% demand growth.

First half over first half for and <unk>.

29% and our ex growth looking at new prescriptions, which we're really pleased with.

And as you mentioned and I think theyre quite strong that's really driven.

I'd say almost completely by the.

And the uptake we've seen and the combo medics.

Patrick J. Haley: In July, NCCN updated their kidney cancer guidelines, and now Cabo Xanthenin, either as monotherapy or in combination, is a preferred agent in every setting in RCC, regardless of clinical risk groups, line of therapy, or disease histolone. This will support the strong and focused execution that the Xelix team is putting forth in the 90-R launch in RCC. A strong Q2 performance and CaboMedics launch trajectory We're thrilled with the opportunity that 9E provides Xylicus and looking forward to as we continue to build upon the foundation in RCC, where Cabometics is the number one prescribed TKI.

<unk> combination launch.

For the new patients that are coming on there and the refills that we're starting to get.

And.

And that in that setting.

And as I mentioned certainly.

Yeah.

The clinical data and their shows.

Year and a half.

Our average duration of therapy. So we think there'll be on for some time, so it's really being driven by that I mean I think.

Early days, now anecdotally and changing a little bit more non clear cell but.

And the NCC and guidelines as I mentioned and we're just updated last month, we're really pleased with that it's now.

And now we have positioning and the NCC and guidelines and favorable intermediate poor first line.

Clear so we have second line clear so as well as non non clear cell, so cabozantinib, either as a combination or monotherapy across the guidelines.

Patrick J. Haley: Our team remains highly focused and motivated to compete every day to bring the benefit of Kabometics to all eligible patients as we continue to build the franchise and maximize potential.

There's certainly great and we think that'll continue to drive growth.

And in combination with the launch and the future, but really the growth is predominantly.

The combination and the first line setting.

And then I guess when you look down the line of future competition and maybe if you can tell us what is your primary research tell us about how your ego Cabo will fare.

Michael M. Morrissey: All right, thanks, PJ. As you heard on the call today, we had a great second quarter with both record Cobbles Anten and franchise net product revenue and total revenue, which led us to update components of our full year 2021 guidance. We're excited about the potential of our work, including the ongoing Khabis Antenipipital trials, the growing clinical development program for XL-092, and our rapidly maturing early stage pipeline, as we advance in our mission to help cancer patients recover stronger and live longer. As we previously announced, Dr. Gisla Schwab, our president of product development and medical affairs and chief medical officer, began a medical leave of absence in June.

And against maybe some of the future launch it, particularly wondering about timberland.

If there's if you look at that.

That's a big.

Big threat or do you think that that youre pretty well protected given the familiar it at that.

And that RPC drop.

With Yugo and.

Cabo.

Yeah no. Thanks for the question.

Certainly the market has been competitive for many years, even in our prior monotherapy.

Settings, but certainly and this combination in first line setting so very pleased with our data and our team and experience and ability to compete there and.

What we've seen and our and our market research and our time on the market.

We're really pleased by REIT already establishing the 28% first line and market share roughly 5 months. After approval is really outstanding and I think it speaks well to the execution of the team and certainly the strength of the data and what we hear from clinicians as it's related to.

Michael M. Morrissey: We're grateful that she continues to engage and advise us during her leave. For more than 15 years, Gis has been deeply committed to our mission and the patients we serve. Frankly, Exilexelsus would not be the company, nor would Combezantin be the drug that it is today without her passionate and tireless leadership.

Totality of the data and the balance of the data the efficacy, particularly the overall survival as well as the safety and Tolerability, we're seeing and the regimen.

Michael M. Morrissey: We simply can't thank Gisela enough for her countless contributions over the years, including her commitment to the mentorship and professional development of her team. We're all extremely proud of how the entire development organization has pulled even further together to keep our many programs on track during her absences. We are now actively searching for our next CMO and hope to have that person on board in the near future. I'll close by thanking the entire Exilex team for their individual and collective efforts during a busy and productive second quarter.

Physicians are seeing and the data.

Coming from the optimized 40 milligram daily starting dose as well as our quality of life, which is important for patients right and we're going to be on therapy for extended length of time.

All of that and all of our work.

Think positions us really well in the marketplace today and going forward.

So we're really confident.

And our position and our team and our execution and look forward to continuing to grow and and helping a lot more patients with RCC.

Thanks, Peter and then 1 quick 1 if I can sneak in here.

Jason presence is definitely missed on this call and and really hope that you have seen so well with her.

Michael M. Morrissey: Exiles has widely embraced the data supporting the efficacy and safety of the COVID-19 vaccines, and I'm proud to report that more than 90% of our team, based both in Alameda and those working remotely, have been vaccinated to date. With that foundation, we are looking forward to working together again with the energy and creativity that can only be truly experienced when working side by side as we discover, develop, and commercialize the next generation of our medicines for cancer patients in need of better and more effective therapies.

Mike If you can channel and a geek.

Could you maybe talk just a little bit about what we can expect in terms of data for XL and 92 in the near term.

Okay.

Yes, I'm happy to do that all channel and my inner Mike because I don't think I can do gisela very well.

Nothing nothing new to really report in that regard here our messaging on <unk> 2 is consistent today as it has been with prior messaging.

Really excited about the profile.

The next Gen Cabo kind of profile that we've got with <unk>.

There is a very exciting clinical and commercial opportunity with this molecule and this obviously has a very very high priority within the organization. We are pleased to have now 3 clinical collaborations to be able to profile.

Michael M. Morrissey: We look forward to updating you on our progress in the future. Thank you for your continued support and interest in Xlexis. We're happy to open the call for questions now. Thank you. And participants, as a reminder, in order to ask the question, you will need to press star one on your telephone keypad. Again, that's Farr, then the number one on your telephone keypad. So, withdraw your question; press the pound key. Your first question comes from the line of Ashika Ganywarine from Tuwist.

And 2 ICI combinations with leading ICIS and certainly our collaborations with them with Roche and Genentech with Merck <unk> and now BMS I think underscore the interest the utility potential validation for the overall approach. So we're certainly very pleased with that.

And our.

Alrighty as today as it has been for for months and months now is too.

Really enhance and expedite the clinical program to move <unk> into pivotal trials.

And as soon as possible and planning on this year, if we can make that work that's the plan.

Asthika Sarith Goonewardene: Your line is now open. Hi, thanks for taking my questions. First, congratulations on this result. Absolutely outstanding. Well done to the team, and we hope to see more of this in the future.

So there is really no new guidance now or previous guidance on the next our next presentation of data.

And when we have those details we will share those with you.

Likely to see us start either new trials and new combinations, new collaborations et cetera, before you see that next dataset.

Okay.

Patrick J. Haley: First question, the growth research we have here for Cabo looks really promising. And I just want to maybe spend a little time teasing out that relative contributions. Obviously, nevo carbon for some RCC was a big amount. I was wondering if PJ maybe could give us some sort of an idea of proportion it came from nevo carbon's interest in RCC, maybe what came from non-clear cell RCC, and if there's any other stocking back, and they got a few more as It's PJ.

Great. Thanks, guys and congrats again and data on day update.

Thank you Jessica.

Yes.

Your next question comes from the line of Mike King from H C. Wainwright. Your line is now open.

Hey, good afternoon, guys. Thanks for taking the question and congrats on a great quarter and.

Let me convey my sentiments towards.

Yes, it was.

Well being and as well.

Just wondering for T. J could can we just talk about I think it's very interesting that.

Yeah.

And if you're willing to.

Patrick J. Haley: I mean, really looking at the comparisons we have of 28% demand growth, sort of first half over the last first half for, you know, 29% NRX growth, looking at new prescriptions, which we're really pleased with, as you mentioned, we think they're quite strong. That's really driven, I would say, almost completely by the uptake we've seen in the KaboMedics. NEVO combination launch for the new patients that are coming on there and the refills that we're starting to get in that setting. As I mentioned, you know, it's certainly The clinical data there shows a year and a half average duration of therapy, so we think they'll be on for some time. So it's really being driven by that.

Project out what you expect the average.

Average duration of therapy would be uncapped low Nemo I just.

For a reference standard do you happen to know what the average time on Cabo as a single agent is and the second line now.

Yeah, Mike.

P J happy to take your questions and.

And talking about projecting the data I'm, just really referring to what we saw and the clinical trial.

About a year and a half with regards to 90 or so that's what we certainly anchor to and obviously you have to see a lot of data.

Patrick J. Haley: I mean, I think, you know, early days now anecdotally, I'm sure we're getting a little bit more non-clear cell, but those, the NCCN guidelines, as I mentioned, were just updated last month. We're really pleased with that. as now we have, you know, positioning in the NTCN guidelines for favorable, intermediate, poor, first line, clear cell. We have second line clear cell as well as now non-clear cell, so Kappa Xantin, either as a combination or monotherapy across the guidelines is certainly great, and we think that will continue to drive growth in combination. Really, the growth is predominantly in combination. Thanks, PJ.

Patrick J. Haley: And then I guess when you look down the line of future competition, maybe we can ask you, what does your primary research tell us about how Nigo Cabo will fare against maybe some of the future launches, particularly wondering about Timberl Lenn? If there's, if you look at that as a big threat or if you think that you're pretty well protected given the familiarity that RCC docs have with Niro and Kaba. Yeah, thanks for the question.

Pieces of data and our and our sort of presentation today, so the anorexia or just any.

Any cabometyx, new prescription from a QB and so that could be and any setting combination line of therapy et cetera, you know what I would point to really looking at to dig into the.

The combination utilization of Cabometyx with Napoleon up and the first 1 setting was the other the queue via data, we shared with with regard to new patient market share.

Which we've seen and get up to 28% now and Q2 with a steady increase and taking share from all competitors in the space, So really establishing strong market share pretty quickly so.

Patrick J. Haley: You know, certainly the market's been competitive for many years, even in our prior monotherapy settings, but certainly in this combination first-line setting. So, very pleased with our data and our team and our experience and ability to compete there. And, you know, what we've seen in our market research, in our time on the market, which we're really pleased about, right, already establishing the 28% first-line market share, you know, roughly five months after approval, is really outstanding.

So that's really the sort of de Novo combination usage.

According to.

To the brand new and pack data.

Okay, and then 1 other quick 1 I should know this but can you just from minus what the.

The status of the filing is and in Europe for based on.

Checkmate 9 E R. Thank you.

That's a good question I think I think they've been.

And I don't want to speak to that that's a good 1 net gifts low and normally answer and.

She's not here so yeah, Michael day back again.

Yeah, sorry, I will just jump in and say that obviously, we will work closely with our partners and Premier.

And it is it's approved and Europe and.

Patrick J. Haley: And I think it speaks well to the execution of the team and certainly the strength of the data. And what we hear from clinicians is it's really the, totality of the data, the balance of the data, the efficacy, particularly the overall survival, as well as the safety and tolerability we're seeing in the regimen, the physicians are seeing in the data, you know, coming from the optimized 40 milligram daily starting dose, as well as our quality of life, which is important for patients, right, or we're going to be on therapy for extended lengths of time.

They are working.

Diligently on securing reimbursement across the various countries, which which is you know is.

Is quite a workout and the application so it's sort of very early days and.

And the launch over there, but they are certainly there I think we're pleased with the progress they are making and what we just kind of.

More to come thanks, so much congrats again.

Thank you Mike.

Yeah and next question comes from the line I've changed and chair Barry from Bank of America and your line is now open.

Hey, guys. Good evening. Thank you for taking my question. So I guess, just so I think the comments about a 1.5 billion run rate and the year year, and and 2022 per I believe that's RCC revenues and just trying to <expletive> that with sort.

Michael M. Morrissey: All that in all our work, we think physicians are really well positioned in the marketplace today and going forward. So we're really confident in our position, our team, and our execution, and look forward to continuing to grow and helping a lot more patients with our Thanks, PJ. And then one quick one if you can sneak in here.

Sort of the guidance through the end of the year I would think like fourth quarter.

You might be like a 3 and a quarter for renal sales and.

1 of billing and run right you did 375 bike per quarter. So.

Like with patient stacking your growing market share just wondering if there is some conservatism based into.

Michael M. Morrissey: Gisla's presence is definitely missed on this call, and I really hope that everything's well with her. Mike, if you can channel your inner Gisla, could you maybe talk to us a little bit about what we can expect in terms of data for Excel 092 in the near future? Yes, I'm happy to do that. I'll channel my inner mic because I don't think I can do Gisla very well.

The guidance for a $1.5 billion run right here and 2022, just kind of considering there'll be another I O T K I and the market, presumably with Merck just wondering how you guys are kind of conceptualizing.

Possibility of another competitor and the space.

Well that's obviously.

Michael M. Morrissey: Nothing new to really report in that regard here. Our messaging at 092 is consistent today as it has been with prior messaging. We are really excited about the profile of the next-gen Cabo kind of profile that we've got with 092. We think there is a very exciting clinical and commercial opportunity with this molecule, and it obviously has a very, very high priority within the organization.

Michael M. Morrissey: We're pleased to have now three clinical collaborations to be able to profile 092 ICI combinations with leading ICIs, and certainly, our collaborations with Roche-N-EKGA and now BMS underscore the interest, and the utility potential validation for the overall approach. So we're certainly very pleased with that. Our priority, as it has been for months and months now, is to really enhance and expedite the clinical program to move 092 into pivotal trials as soon as possible. Planning for this year, if we can make that work, that's the plan.

Michael M. Morrissey: So there's really no new guidance now or previous guidance on the next presentation of data, although obviously when we have those. details, we'll share those with you. You're likely to see us start either new trials, new combinations, new collaborations, et cetera, before you see that next data. Great, thanks, guys, and congrats again on the update. Thank you. Your next question comes from the line of Mike King from H.C. Wainwright. Your line is now open. Hey, good afternoon, guys.

The 2 response assessments for for PFS for duration of response for disease control rates.

Michael George King: Thanks for taking the question. Congratulations on a great quarter, and let me convey my sentiments towards Giesla's well-being as well. I just wonder for Tid, can we just talk about, I think it's very interesting that you're, you know, you're willing to have, project out what you expect the average duration of therapy would be on Cabo Nevo. I just, for a reference standard, do you happen to know what the average time on Cabo as a single agent is on the second line now?

They are all I think promising and.

Warrant.

<unk> deep dive into the value of those on top of the response rate and the 20% range.

So so we feel good about that we're encouraged by it and obviously.

The dialogue with the agency, we will define our steps forward, we're seeking alignment there.

If there is 1 or flat so the skepticism that's out there so be it we're going to we're going to generate data and this case.

And those discussions and have a path 1 way or the other based upon that feedback so but.

But we feel good about the data and certainly as it I think as it portends for contact and <unk>, we feel good about that too.

Okay got it great. Thanks, guys.

Patrick J. Haley: Yeah, Mike, this is PJ, happy to take the questions. I mean, in talking about projecting the data, I'm just really referring to what we saw in the clinical trial about a year and a half ago with regard to 90R. So that's what we certainly anchored to and obviously have to see a lot of data in the commercial setting and look at it retroactively before retrospectively rather before you can really see that in the marketplace.

Thank you Jay.

Your next question comes from the line of Andy Casey.

From William Blair. Your line is now open.

Great. Thanks for taking my question and congratulations on a record breaking quarter.

Just like last quarter and.

Best regards to diesel and her family.

In terms of questions.

Wondering if you take any comment on.

And of the RCC market size relative to pre COVID-19 level. So.

Patrick J. Haley: What we've seen and we're pleased with with regard to Cabo's single agent is that we saw it really, more or less approximate what we saw in the media trial in terms of duration of therapy, you know, 7, 7 and a half months, in terms of the PFS generally, and, you know, the longer we've had patients on therapy, there are certainly some patients who do remain on for many years, which is certainly a benefit that those So, you know, what we've seen so far is it's a pretty good surrogate to use in the trial. Obviously, something will track closely going forward.

I think you've commented extensively about the market shrinking towards the back half of last year. So just maybe give us a sense of where we are currently relative to.

And then make levels and also.

I'm just curious on the.

And 2 data points that you have which is.

And the second quarter, you had mentioned about a shrinking and.

New totals and sorry, new scripts, but.

And increase in total scripts just curious if there is any sort of.

Secrecy is here in the second quarter.

Yes, thanks for the questions and I'll start with kind of the I guess the market.

With regards to kind of a COVID-19 dynamic.

Patrick J. Haley: Okay, I appreciate that. Also, can you comment about whether the NRXs are individuals who are already on an immune checkpoint or on Nevo already? Or do you know if they're starting the combination sort of de novo?

And as we talked about last year, we certainly did see some impact.

In other markets, particularly in kind of the middle of the year Q2 Q3.

<unk> was kind of.

First really started to flow.

Patrick J. Haley: Well, I guess I'll point to maybe two different pieces of data in our sort of presentation today. So the NRXs are just any, any Cabomedics new prescription from the QBia. So that could be in any setting, combination, line of therapy, et cetera.

To have impact across the country I would say what we've seen generally as we've seen that sort of slowly recover at least and the RCC market.

I don't think we're kind of quite all the way back to normal by any means and obviously theres Sylvia.

New variants et cetera.

But I think I.

Patrick J. Haley: You know, what I would point to really digging into the combination utilization of the Kabometics with Novolumab. In the first line setting, the other Acuvia data we shared with them with regard to new patient market share, which we've seen get up to 28% now in Q2 with a steady increase and taking share from all competitors in the space. So really establishing a strong market share pretty quickly. So that's really the sort of de novo combination usage according to the brand impact.

I think it has certainly stabilized and.

And recovered.

Somewhat there.

And with regard to your to your other question and I just to make sure I'm clarifying.

What we saw with regards I'll, just point to and Rx data.

And so what we saw was roughly stable and our ex data.

And from <unk> in Q2 relative to Q1 for Cabo and <unk>, while the market there was down 5%.

Problematic, so stable and thats actually a pretty pretty common thing season.

Patrick J. Haley: Okay, and then one other quick one, I should know this, but can you just remind us what the status of the filing is in Europe based on Checkmate 9 ER? Thank you. That's a good question. I think they've been, you know, I don't want to speak to that. That's a good one that Gisla would normally answer, and obviously she's not here.

Seasonally we see just Q1.

New prescriptions are pretty big and that can be insurance and a variety of other things.

And I mentioned are our third and lawn chairs declined a bit and that's because most patients.

At this point have seen Cabo and <unk>. So we're really pleased with that we saw a leading second lion's share we get the majority of post Io patients and the second line and obviously, we've had really a lot of growth first line and and as I mentioned too just with regards to begin our ex what we see internally and our new patient starts, which we track very.

Unknown Executive: So, Mike, we'll get back to you. Yeah, we'll just jump in and say that, you know, obviously, we work closely with our partners. It's in there. And, in fact, it is, it's approved in Europe.

Closely and have a lot of data I'm not going to share.

Unknown Executive: And, you know, they're working diligently on securing reimbursement across the various countries, which, as you know, is quite a workout. Yeah. So it's sort of very early days in the launch over there, but they're certainly, I think, we're pleased with the progress. More to come. Thanks so much.

And publicly but we've really seen some some stronger and more robust numbers and then what.

And <unk> and Rx data estimate so I think we're seeing really strong growth and were seeing and improving patient mix in terms of our new patients on complement ex driven by the first line combination usage and I think the 28% market share that we're seeing there is.

Michael M. Morrissey: Congratulations again. Okay. Thank you, Mike. Your next question comes from the line of Jason Gerberry from Bank of America. Your line is now open.

And is really.

Strong and driving that.

Yeah. That's helpful. Thanks P J so for.

Jason Matthew Gerberry: Hey, guys, good evening. Thank you for taking the time to answer my questions. So I guess just, so I think the comment about a 1.5 billion run rate end of year, year end 2020 for RCC revenues. I'm just trying to compare that with sort of the guidance for the end of the year. I would think, like, in the fourth quarter, you might be like at 3.5 and a quarter for renal sales, and at 1,5 billion run rate, you'd be at 375, like, per quarter.

Peter.

Yes, I think there is a increasing emphasis on an ADC and the pipeline.

And the last ADC were approved under accelerated approval program. Just curious if that has tended to standard.

Clinical trial, our clinical development plan for ex vivo to going forward.

Yeah happy to kind of get a sense of your take on that.

Michael M. Morrissey: So it seems like with patient stacking, you're growing market share. Just wondering, is there some conservatism based in the guidance for a 1.5 billion run rate year in 2022, just kind of considering there'll be another IOTKI in the market, presumably, with Merck. Just wondering how you guys are kind of conceptualizing the possibility of another competitor in the space. Well, that's, you know, obviously something that we're focused on and think about a lot relative to the competitive dynamics here. I think PJ framed it well.

Yeah. Thanks, Andy I appreciate the question and.

I think thats very much and <unk>.

Well.

And I think as you commented 6 approvals I think and the last 12 to 18 months based on accelerated approval I think 1 of the attractive features of ADC.

Contemporary and Adcs.

And to be active you find out pretty early on and it's really matter.

And we found as kind of a therapeutic index.

And obviously your activity vs side effect profile.

And <unk>, which is our kind of next generation and tissue factor targeting ADC.

And just to recap this is.

Centers already and 2 to fact that targeting ADC, that's been and phones into the clinic.

Symptom overdosing.

Thanks, Joe and encouraging clinical activity and cervical cancer. So we don't and deep tissue factor kind of derisked target from that point of view.

Michael M. Morrissey: That's been the case with RCC since, you know, the day we started the media trial and the day we got approved, and the day we launched. So that's nothing new here. I think the $1.5 billion run rate guidance by the end of 22. Again, that was put out there several quarters ago, well before we launched, with, I think, the appropriate level of market research guiding that estimate and guiding kind of a long-term view on the ramp for market share and duration of therapy.

And <unk> 2 is the next generation version and then.

And a number of significant ways.

It's a different antibodies that targets a different epitope on tissue factor that should get around some of the bleeding issues that have been seen.

This move to map.

And the different linker and payload and when it comes and optimize more stable linker.

Which should enable us hopefully to dos clients.

As well.

So, we certainly see cervical cancers and.

Area of interest and.

The ongoing phase 1 clinical trial is actually looking at a fair number of different solid tumor types based on what we know about over expression of tissue factor. So in addition to cervical.

Michael M. Morrissey: So I think we're sitting pretty good right now relative to being able to hit that mark. You can do the four-looking math on, based upon these numbers, what it takes to get there over the next six quarters.

And with low.

Michael M. Morrissey: I think those are numbers that are achievable, even with competition coming up. So we feel good about that, and obviously, that's a baseline that we want to build off of with other trials in RIMO and certainly other indications going forward.

Long ovarian filial pancreatic and head and neck.

And also places to go from a development point of view and.

And certainly from within.

Within this clinical trial the intent, obviously is to find and appropriate dose to take forward.

Expand out into a number of different cohorts and and things won't be setting and then follow the data.

Michael M. Morrissey: And if I get to squeeze a follow-up, just on TRPC filing, I know the markets are skeptical; you can get there just on cohort 6, but what will be your lead arguments going into the FDA that cohort 6 should be an approvable basis as opposed to a more traditional phase-free pathway? Yeah, I certainly don't want to comment on the discussions or topics that we'll have with the agency. I think what I'll do is answer, as I've done previously, a near 20% response rate by blinded independent review relative to standard of care, which by contemporaneous pivotal trials has been a second NHT, with response rates in the low single digits, which I think is an encouraging signal.

And if you start seeing encouraging signals trials are designed to enable you to enroll additional.

Additional patients into those cohorts as appropriate and I would say that's a general kind of philosophy that we have right now it's not exclusive to so you'll see us kind of take that path.

Thank you.

Last question, if you don't.

And I wanted to kind of revisit that for billing and revenue.

And that you've provided.

Obviously, a lot of things have changed I'm just curious if there is.

Any sort of high level.

Sure.

<unk>.

Changes that you see.

Pertaining to maybe the different contributions from across the different indications.

Things like that strength and weaknesses across.

And segments.

Happy to kind of hear your thoughts there too.

Yes, Andy I'll be happy to address that 1 so just as a as a reminder, the whole goal behind putting out those numbers at at J P. Morgan and 2020.

Michael M. Morrissey: If you look at the concordance between the two response assessments for PFS, for duration of response, for disease control rates, they're all, I think, promising and warrant, I think, a deep dive into the value of those on top of the response rate in the 20% range. So we feel good about that.

We're really to define what success looks like right.

Assuming success across the board and generating differentiated and clinical data.

How big could the Cabo franchise fee range so as.

And as we've highlighted previously we didn't risk adjust those numbers.

Michael M. Morrissey: We're encouraged by it, obviously, the dialogue with the agency will define our steps forward. We're seeking alignment there. If there's alignment, we'll move. So, you know, the skepticism that's out there, so be it.

Just to kind of frame shift going back a couple of years, we hadn't even seen 90, ARPA and ranked in terms of that data. So so those were again aspirational in nature.

Werent meant to be updated and we're not going to update them relative to what's happening.

Slide 11 of that deck, which I've now got memorized and I'm sure you do as well has all the math. So if you want to adjust that based upon your assumptions based upon your modeling please.

Michael M. Morrissey: We're going to generate data in this case, in those discussions, and have a path one way or the other based upon that feedback. So, but we forget about the data, and certainly, as it portends for contact O2, we forget about that too. Okay, great, thanks, guys. Yeah, thank you, Jason. Your next question comes from the line of Andy Chase, from William Blair. Your line is now open. Great, thanks for taking my question and congratulations on a break-for-breaking quarter, just like last quarter. And, you know, best regards to Giza and her family.

Please have added our focus is making sure we can advance the pipeline of moving to.

Carlo program across the board and and the pipeline across the board. So we can again address more patients bring more benefit to.

Cancer patients, who need better and more effective therapies, and then build a business based on that.

Okay.

Got it okay, well, thanks for answering all my questions and congratulations again.

And I appreciate it and Andy Thank you.

Your next question comes from the line of Michael Schmidt from Guggenheim. Your line is now open.

Hey, guys. Thanks for taking my questions and congrats on the day, Greg second quarter from a solid thats off from me a pipeline question.

How are you tracking towards top line data this fall.

Andrew Peters: So in terms of questions, I'm just wondering, PJ, can you comment on the RCC market size relative to pre-COVID-19 levels. So, you know, I think you've commented extensively about the market shrinking towards the back half of last year. So maybe give us a sense of where we are currently relative to pre-pendemic levels. And also, I'm just, you know, curious about the two data points that you have, which is in the second quarter you mentioned a shrinking in new, total, sorry, new scripts but an increase in total scripts. Just curious if there's any sort of synchrasies here in the second quarter.

<unk> costs make 313, and perhaps could you share your thoughts on how the triplet.

Might potentially be incorporated into clinical practice and relative to the checkmate <unk> regimen.

Except perhaps and additional patient segment.

And that is not currently addressed what the doublet that you think might my.

Benefit from from the trip plan.

Yeah sure. So as we've talked about previously cosmic 301.3.

<unk> achieved full enrollment I believe back and at the end of Q1 and the March timeframe.

This year. So it's an event based trial, so our projections and of this year early next year, but it's always event based so so I would I would view that that estimate with pretty healthy error bars, and certainly as we as we accrue more events, we will have a better sense of of timing per se.

Patrick J. Haley: Yeah, thanks for the questions, Andy. I'll start with kind of the market with regard to COVID-Dan. You know, as we talked about last year, we certainly did see some impact in the market, particularly in the middle of the year, Q2, Q3, as the pandemic was kind of, first really started to have an impact across the country.

And we're really excited about.

Excuse me.

No. This is back and got it got it and we are we are really excited about the opportunity there certainly and.

A high level and think about combining the best of Io Io with the best of Iot Cai and a framework for patients who could benefit further in terms of any number of different parameters and 2.

Terms of incur.

Increasing the number of patients who have some level of disease control sales.

And what you see with Io Io and extending.

The tail and.

Patrick J. Haley: I'd say what we've seen generally is that we've seen that sort of slowly recover, at least in the RCC market. I don't think we're kind of quite all the way back to normal by any means, and obviously there's still Delta, new variants, etc., But I think, you know, I think it has certainly stabilized and recovered somewhat there. And, you know, with regard to your other question, just to make sure I'm clarifying what we saw with regard to, I'll just point to NRX data. So what we saw was roughly stable NRX data from a QVIA in Q2 relative to Q1. For Cabometics, while the market there was down by 5%, Cabomatics was stable, and that's actually a pretty common thing.

In terms of raising the tail in terms of both <unk> and Iot chaos across the segments.

Of opportunities, we think it's a very very important next next generation trial I think it's notable that this is the first triplet I think thats been done contemporaneously.

And for Nio that we're certainly excited to be part of so so lots of opportunity lots of upside.

And obviously, we're in the where and the game of hazard ratios and P value. So we have to see the data before we get too much.

Get too far ahead of ourselves, which we're not doing obviously, but certainly this is an opportunity for us to continue to build on the success of <unk> and on the success of Meteor and accomplished and really continue to build the franchise and renal.

Alright makes sense, great and then just a follow up obviously.

<unk> continued to invest and early stage pipeline now.

3 additional programs and clinical studies, because there'll be a few things going on pre clinically as well.

I guess in that context.

Patrick J. Haley: Seasonally, we see just that Q1 new prescriptions are pretty big, and that can be insurance and a variety of other things. You know, I mentioned our third line shares declined a bit, and that's because most patients, at this point, I've seen CaboMedic, so we're really pleased with that. You know, we still have a leading second-line share.

To what degree has your philosophy towards business development and shifted perhaps and the last couple of years and what level of urgency do you have at this point to perhaps and license a later stage product candidates.

And maybe closer to market.

Yes look I think our overall approach here is been consistent and I think we've been executing on relative to a variety of early stage deals that we've gotten done last year and this year and the Q that we're looking to complete.

Patrick J. Haley: We get the majority of post-I.O. patients in the second line, and obviously, we've had really a lot of growth in the first line. And as I mentioned, too, just with regard to the NRX, what we see internally in our new patient starts, which we track very closely and have a lot of data that I'm not going to share publicly, but we've really seen some stronger and more robust numbers than what... Vecuvia NRX data estimates.

And the relative near future. We continue to look at a variety of late stage assets I think the opportunity there is to really have conviction that whatever we.

Built into our buy into our buy has the we have the conviction that not only is there a high probability of clinical success and regulatory success, but maybe more importantly, commercial success and I think someone like you Im sure you track this better than I have but.

There is a lot of oncology launches that have taken place over the last couple of years that just quite frankly haven't done that well. So so getting over the goal line with again, the right hazard ratio and the right P value and and ultimate approval doesn't necessarily guarantee commercial success and that's the game that we're in so so any any big.

Patrick J. Haley: So I think we're seeing really strong growth, and we're seeing an improving patient mix in terms of our new patients on Kabometics driven by first line combination usage. And I think the 28% market share that we're seeing there is really, you know, strong and dry.

Big deals that we do any big bets that we make we need to have conviction that it's the right value if the right opportunity and that the probability of commercial success is very very high.

And then Greg Thank you and congrats on the quarter again thanks. Thank.

Thank you Michael.

Peter Lawson: Yeah, that's helpful, thanks, PJ. So for Peter, you know, I think there's an increasing emphasis on ADCs in the pipeline. You know, six of the last ADCs were approved under the Accelerate Approval Program. I'm just curious if that is kind of the standard clinical trial or clinical development plan for XBOO2 going forward. Yeah, happy to kind of get a sense of your take on that. Yeah, thanks, Andy.

Your next question comes from the line of Yoga and Werber from Cowen and co. Your line is now open.

And thanks for taking my question. This is gave onto your own.

Just.

Focusing on the pipeline to fill other questions on top of and pretty much asked already.

Any updates on <unk> with the.

Expansion cohorts are kind of just any any update on that.

And then future and timing.

Mentioned.

<unk> potentially some more.

Fiscal year 'twenty, 1 just curious if those remain on track. Thank you.

Peter Lawson: I appreciate the questions. And yeah, I think that's very much of you with it as well. I think, as you commented, it's been six approvals in the last 12 to 18 months based on accelerated approval.

Yes, So I think we've I think we've said all we plan to stay about <unk> 2.

And prepared remarks, and I think the question from aspect and so I'll pass the pipeline question and with new Ind's over to Peter Yes, sure. So as you can probably slower and the pipeline slide we do have a compound called ex 1.4.

Peter Lawson: I think one of the attractive features of ADCs, especially contemporary ADCs, is if they're going to be active, you find out pretty early on. And it's really a matter for them to be able to balance kind of the therapeutic index, in terms of obviously your activity versus side effect profile. So, the XBOO2, which is our kind of next generation tissue factor targeting ADC. And just a recap here, this is, as I said, there's already a tissue factor targeting ADC that's been advanced into the clinic. Thithotumavidotin, which has shown encouraging clinical activity in cervical cancer.

And that's a contract we have.

True to a little bit previously.

And from our origin collaboration normalcy.

And normal small molecule has a novel mechanism of action, which.

And now at least went up we're not going to be speaking about it does remain on track from <unk>.

And this year, we see the primary indication for this compound being bigger indication. Although we are also exploring pre clinically and the potential for different solid tumor indications.

Okay.

And any other questions or wanted to move on.

That's great. Thank you.

Thank you. Your next question comes from the line of Jay Allison from Oppenheimer. Your line is now open.

Hello. This is shown on the line for J. Thanks for taking our question and our best wishes to kids low.

Peter Lawson: So we're going to view tissue factor as a kind of de-risk target from that point of view. XBOO2 is the next generation version that differs in a number of significant ways. It's a different antibody that targets a different epitope on tissue factor that should get around some of the bleeding issues that have been seen with diphtomab. The different linker payloads, we might kind of optimize them to be more stable. Linker, which should enable us, hopefully, as well.

Just wanted to ask about.

Cabo plus <unk>.

And the academic and uncommitted community settings.

Seemed like in the Q2, you have stronger growth in the community settings over the academic.

Just curious about your thoughts on the growth rate and just to set into moving forward.

Also just wondering if the adoption and a community.

Centers.

It's more related to the in person interaction between ourselves and the prescribers and thank you.

Peter Lawson: So we certainly see cervical cancer as an area of interest. The ongoing phase one clinical trial is actually looking at a fair number of different solid tumor types based on what we know about overexpression of tissue factor. So in addition to cervical, we intend to have patients with lung, ovarian, urethelial, pancreatic, and head and neck. So there's lots of places to go from a defensible point of view.

Yes.

Yes, thanks for the question.

I think with regards to the academic and community kind of split.

As I kind of mentioned academics.

Academics typically adopt quicker and we saw that were very pleased with that and certainly.

I think we have some some potential to grow there but.

We're particularly pleased by the performance and the community setting going from a market share in Q1, there of 11% to.

And to 25% and Q2.

And I think there's a lot to that typically it takes a little longer.

Peter Lawson: And certainly from within this clinical trial, the intent is obviously to find an appropriate approach to take forward, expand out into a number of different cohorts in a phase 1B setting, and then follow the data. So obviously, we have started to see encouraging signals. Trials are designed to enable you to enroll additional patients into those cohorts as appropriate. And I would say that's the general kind of philosophy that we have right now. It's not explicit for O-O-2, so you'll see us kind of take that path too.

And sort of reach and educate broader and the community to drive that uptake and the education.

And I think we're still relatively early days and that so we think.

And we certainly have the opportunity to grow.

Lot more and the community setting, which is really 75% give or take of the business and RCC.

And I think youre right on with regards to.

Kind of navigating the pandemic.

Certainly makes particularly educating and the community setting a little more complicated and.

Really proud and pleased with our team's done a great job of of engaging their where appropriate and.

Andrew Peters: Thank you. So last question, if you don't mind, I want to kind of revisit the $4 billion revenue guidance that you provided. You know, obviously, a lot of things have changed.

Person.

Certainly virtually by assume and a variety of different mechanisms.

Digitally.

Non personal promotion and we have seen things sort of kind of open up over the past couple of quarters, obviously now with the Delta variant and.

Michael M. Morrissey: I'm just curious if there are, you know, kind of any sort of high-level changes that you see pertaining to maybe the different contributions from across the different indications and, you know, things like that, strengths and weaknesses across, you know, different segments. Yeah, Andy, I'll be happy to address that one. So just as a reminder, you know, the whole goal behind putting out those numbers at JP Morgan in 2020 was really to define what success looked like, right?

And kind of the trends we're seeing.

And Covid now.

Things are getting evolving and often this is regional and even account by account as we see that but I.

I think we've got great momentum there.

And our story is just resonating really well.

Referred to earlier, so I see.

Certainly.

A lot more potential there.

Things can continue and the community as well so very pleased with the performance and I think the 28% market share and really the first full quarter after launch.

Michael M. Morrissey: You know, assuming success across the board and generating differentiating clinical data, how, you know, how big could the Cable franchise be, right? So as we, you know, as we've highlighted previously, we didn't risk adjust those numbers, you know, just a kind of frame shift going back a couple years.

Just a great start and speaks well to.

And the work of the team and importantly, the.

And the data are resonating with physicians.

Got it thank you.

Your next question comes from the line of Peter Lawson from Barclays. Your line is now open.

Hey, Mike.

Just.

Thanks for the other.

Detail.

Just around the aspirational guidance is that something that would be updated on a kind of.

Michael M. Morrissey: We hadn't even seen 90-R then, right, in terms of that data. So those were, again, aspirational in nature. They weren't meant to be updated, and we're not going to update them relative to what's happening. You know, slide 11 of that deck, which I've now got memorized, and I'm sure you do as well, has all the math.

Annual basis or every couple of years, just how do you kind of think.

Think about that and kind of communicate and met with the street.

Yeah. Thanks, Peter I think you might have missed.

I think the question that Andy asked.

Most almost verbatim exactly the same and I won't repeat myself again.

Michael M. Morrissey: So if you want to adjust that based upon your assumptions, based upon your modeling, you know, please do. Our focus is making sure we can advance the pipeline of the COVO program across the board and then the pipeline across the board. So we can, again, reach more patients, bring more benefit to, you know, cancer patients who need better and more effective therapies, and then build a business based on that. Well, thanks for answering all my questions, and congratulations again. I appreciate it, Annie.

But yes, R&D already answered that question. So let me go ahead and that's good.

And that's that's not something you'll be thinking about update and every year or every couple of years.

Yes, and maybe you missed it when I answered the question previously with with Andy but yes, we've said, we're not going to update that that was aspirational.

Aspirational view of what success looks like prior to having any data so and it was based on.

The idea that if we were able to generate compelling and differentiating clinical data that would define the market.

Got you.

And would that be updated you think after you get additional approvals just to kind of is that how youre thinking about those updates.

As you get momentum I think I just answered the question Peter Kim, let's let's move onto the next question.

We do provide annual guidance and then.

And the yearly guide range, yes, yes, perfect. Okay. Thanks.

Thanks, so much.

You bet.

Andrew Peters: Your next question comes from the line of Michael Schmidt from Guggenheim. Their line is now open. Hey guys, thanks for taking my questions and congrats on the great second quarter results as well from me. A pipe-in question, I guess, how are you tracking towards top-line data disclosure for Cosmic 313? And perhaps, could you share your thoughts on how the triplet might potentially be incorporated into clinical practice relative to the Checkmate 9-E-R regimen, if there is perhaps an additional patient set?

Your next question comes from the line of Kenneth Mackay from RBC capital markets. Your line is now open.

Hey, Mark I was hoping on.

Aspirational, no I'm kidding I'm kidding.

Yes.

No. Please ask it again commodity.

I was actually I did have a cargo customer and I can go on top of all day.

And Youre getting a lot of information channel back from your commercial teams and I'm talking here.

And then anecdotal evidence youre collecting for why docs are reaching for Cabo and <unk> and frontline RCC versus some of the competitive combo regimens out there.

Michael Schmidt: Thank you. That is not currently addressed with the doublet that you think might benefit from the triple. Yeah, so as we talked about previously, Cosmic 313, achieved full enrollment, I believe, back in the end of Q1 in the March time frame of this year. So it's an event-based trial, so our projections, you know, end of this year, early next year, but, you know, it's always event-based. So I would view that estimate with pretty healthy air bars, and certainly as we accrue more events, we'll have a better sense of time. timing per se. You know, we're really excited. Excuse me?

And we've heard over and over again that docs prefer Cabo and Evo and more advanced tumors for Cabos rapid.

Effect onset of effect wondering if youre seeing at all or hearing at all and increase and those more advanced tumors, given the COVID-19, pandemic and decrease churn for surveillance and biomarker screening or.

If thats not playing out if there are any other anecdotes that you are hearing.

And on the quarter, Yes, Yes, let me say a few words and then P. J can provide some additional color commentary.

And the the individual components Cabo and <unk> had been the mainstay within kidney cancer since their introduction is back and the <unk>.

Michael M. Morrissey: Nope. Got it. Got it. We are really excited about the opportunity there. Certainly, at a high level, think about combining the best of I-O-I-O with the best of IOTKI in a framework for patients who could benefit further in terms of any number of different parameters, in terms of, you know, increasing the number of patients who have some level of disease control, say, what you see with I-O-I-O, extending the, the, tail in So across the segment of opportunities, we think it's a very, very important next-generation trial. I think it's notable that this is the first triplet.

2015, 2016 timeframe. So there is a.

Long history and familiarity with.

With these 2 drugs and to be quite Frank almost are clamoring for the combination I remember when on July 21, 22015, when that and when our data and the BMS data came out together the sum of the initial feedback we got from Kols and.

And the day of the topline results was let's start combining these molecules because you could really see some good activity. If they were put together. So so theres been a history here theres been momentum building for years.

The 90 and our data was.

And a large to a large degree.

Ceded expectations in terms of efficacy tolerability and quality of life and.

1 other things that we really believe and if you combine great data with a great team.

You can really make make headway and very very quickly and to go from a standing start in January to having leading either a <unk> or a leading share within within 5 months is just a testament to the data that the clinical teams put together and then just the great commercial effort. So.

Michael M. Morrissey: I think that's being done contemporaneously for an IO that we're certainly excited to be part of. So lots of opportunity, lots of upside. Obviously, we're in the game of hazard ratios.

So again I think it's.

The broad uptake speaks for itself and we're looking to capitalize that and build on that going forward P. J. Other words, yes, no I mean, I certainly agree.

Experience of physicians with these drugs.

Michael M. Morrissey: He values, so we have to see the data before we get too far ahead of ourselves, which we're not doing, obviously, but certainly this is an opportunity for us to continue to build on the success of 90R and on the success of Meteor and Kavanaugh Sun and really continue to build a franchise and re-es. That makes sense, great. And then just a follow-up, you've obviously continued to invest in your early-stage pipeline now with three additional programs and intellectual studies, presumably a few things going on pre-clinically as well. I guess in that context, to what degree has your philosophy toward business development shifted, perhaps, in the last couple years? And, you know, what level of urgency do you have at this point?

Sort of.

Longstanding and excitement to use them certainly helps really across the board and we hear a lot of anecdotes and into your question.

But I don't really and I think they are very broad and a sense, but.

I think physicians see the totality of the data and.

And they can find lots of different patients to utilize summit.

Whether it's rapidly progressing patients whether it's a favorable patient where they may be are really thinking about the.

The Tolerability profile its debut of favorably, which many do so I think there is what we see and and it's really represented well and the NCC and guidelines.

It really gives them the option to use these broadly and I think 1 thing.

We will continue to see and the community is they don't see as many kidney cancer patients on a per capita basis, so that they get comfortable with <unk> and evo on kind of used.

Use basis day, they can really and the potential to use it.

Or is it across the board for all their kidney cancer patients and particularly.

Michael M. Morrissey: to perhaps in-license a later stage product candidate that's, you know, in, you know, maybe closer to market. Yeah, look, I think our overall approach here has been consistent, and I think we've been executing on relative to a variety of early-stage deals that we got done last year and this year, and the queue that we're looking to complete, you know, in the relatively near future. We continue to look at a variety of late-stage assets.

And we got talking about the Tolerability profile and really the optimized.

40 milligram dosing and daily.

And is quite really well and the combination and I think that's really reframed, how folks think about the tolerability profile and <unk>. So it's.

It's great and we're able to do that and wowing combination.

But I think it just has a lot of potential benefits for a variety of patients and physicians, we're seeing that across the board.

Makes sense.

Michael M. Morrissey: I think the opportunity there is to really have conviction that whatever we build into or, you know, buy into or, you know, by has the conviction that not only is there a higher probability of clinical success and regulatory success but, maybe more importantly, commercial success. And I think, you know, someone like you, I'm sure you've tracked this better than I have, but there have been a lot of oncology launches that have taken place over the last couple years that, you know, just quite frankly, haven't done that well. So, so getting over the goal line with, again, the right hazard ratio, the right P value. and ultimate approval doesn't necessarily guarantee commercial success.

Got it got it. Thank you yeah. Thank you Shannon.

Your next question comes from the line of friendship with Danielle Goldman Sachs. Your line is now open.

Thanks, very much for the opportunity for the question.

Very healthy cash balance, obviously generating cash flow.

Streaming strongly from the Cabo success commercially can you comment upon how youre thinking about capital allocation strategy remind me, whether or not and you'll have a share repurchase allocation and maybe how frequently you sort of revisit the prioritization of those types of decisions.

Thanks, Chris as Chris Center.

So.

I think we break it down and a couple of pieces right. We're going to continue to do the BD that Mike talked about earlier.

Mahler deals.

Looking same size and scope that we have been doing we continue to look for.

Other opportunities to continue to enhance the pipeline.

Michael Schmidt: And that's the game that we're in. So any big, you know, big deals that we do, any big bets that we make, we need to have conviction that it's the right value, it's the right opportunity, and that the probability of commercial success is very, very high. Good, great. Thank you, and congrats on the quarter again.

And.

Right now, we think Thats the best investment of our cash balance, but we do Mike and I talked about capital allocation and cash utilization, all the time and and we do that.

And we do it in a way that we're trying to understand what's the best answer for from a shareholder perspective, and how do we return capital to shareholders.

And so.

Basically the way we look at it.

And you Havent every purchase allocation currently.

Yaron Werber: Thank you, Michael. Your next question comes from the line of Yaron Werber from Cohen & Coe. Your line is now open. Hey, thanks for taking my question. This is Gabe on for your own.

We do not have a share purchase allocation currently but as I said, we continue to look at the capital allocation and see what's the best return and capital.

Got it and then in terms of the generic challenge is there anything that you might be able to share with us updating on progress I believe we are still on track for.

Gabe: Just focusing on the pipeline, just the other questions on Cobb have been pretty much asked already. Any updates on 092 with the expansion cohorts or, you know, kind of just any updates on that? And then future IND's timing mentioned, you know, previously potentially some more in fiscal year 21. Just just curious that those remain on track.

And may of 2022 and.

Anything on that front incremental days.

Yes, Chris Thanks, Mike Yeah, nothing that I can really share here.

The process is the process and I think it's evolving as we expect but I really can't go into details publicly so.

Okay, and then finally share the commentary and support for others.

Michael M. Morrissey: Thank you. Yeah, I think we've said all we planned to say about 092 already in prepared remarks, and I think the question from Astica is, So I'll pass the pipeline question with new I and these over to Peter. Yeah, sure. So you can probably see on the pipeline slide. We do have a compound called XL114. And that's a compound we have referred to a little bit previously. It's coming from our original collaboration. It's a novel small molecule that has a novel mechanism.

Obviously, you have a very strong clinical development and bench on your team based upon Cabo success.

As you think about.

Furthering the direction of that group of people that core group of people are there any different things that you are looking about looking for any strengthening and particularly as you think about the adcs that and your pipeline just in terms of the C suite and guiding some of those clinical decisions any updates there.

Yeah, no. It's a good question, it's 1 that we're looking at very carefully obviously.

Peter Lawson: of action which, for now, at least, we're not going to be speaking about, but it does remain on track for an IND this year. We see the primary indication for this compound being a heme indication, although we are also exploring preclinically the potential for different solid tumors and, Dave, any other questions or do we want us to move on? Thank you. Thank you. Your next question comes from the line of Jay Olsen from Oppenheimer. Your line is now open. Oh, hello, this is Cone on the line for Jay.

And then a replace Gisela I think thats.

Think of it really.

Fair way to look at it we're looking to bring somebody in with.

And their own unique skill sets their own unique perspective somebody who can help us go to the next level further.

For the years to come so it's 1 that.

Diesel has been.

Key key key part of this team and this organization and building this culture and I want to.

Take per opportunity her success.

Our impact on the organization and help go to the next level now so.

Cone: Thanks for taking our question and our best wishes to Gisla. We just want to ask about the Cabo plus Neville in academic and community settings. It seemed like in Q2, you had stronger growth in the community settings over the academic. Just curious about your thoughts on the growth rate in these two settings moving forward. Also, just wondering if the adoption in a community center is more related to the in-person interaction between our cell team and the prescribers.

And she'll be part of that process right. We talk on a regular basis, we're brainstorming about about opportunities and.

And kind of.

Candidates those kinds of things already so so im looking forward.

To continuing that collaboration to be able to bring this next next CMO and help US go to the next level.

Great. Thank you very much I appreciate the answers. Thank you.

Your next question comes from the line of Stephen Willey from Stifel. Your line is now open.

Patrick J. Haley: Thank you. Yeah, thanks for the question. You know, with regard to the academic and community kind of split, as I kind of mentioned, we, you know, academics typically adopt quicker, and we saw that, and certainly, I think we have some potential to grow there, but, particularly pleased by the performance in the community setting, going from a market share in Q1 there of 11% to 25% in Q2. And I think there's a lot to that. Typically, you know, it takes a little longer to sort of reach and educate the wider community to drive that uptake and education.

Yes, Thanks for squeezing me in and.

Congrats on the quarter and best wishes to Gisela.

Just a quick question I guess with respect to utilization and that might be occurring with it.

Specific subgroups of risks, so groups and that Youre talking about seeing adoption across all risk.

Risk subgroups, but.

I guess when I, just kind of look at some of the PKI data and I know that you're outpacing the market.

The <unk> market, but it looks like I guess, both this quarter and last quarter, a lot of the share gains and seem to be coming at the expense of go trees and students, which we know are also the.

Patrick J. Haley: And I think we're still relatively in the early days of that. So we think, you know, we certainly have the opportunity to grow. a lot more in the community setting, which is, you know, really 75, 80%, give or take, of the business in RCC. And I think you're kind of right on with regards to kind of navigating the pandemic, certainly makes you aware of, kind of the trends we're seeing in COVID now, this is, you know, things are again evolving. And often this is regional and even account by account, as we see that.

Single agent and Teekay is other most commonly prescribed and favorable risk patients. So just wondering if you guys have a sense as to how much of this initial adoption, you're seeing and the frontline setting is a replacement of just.

<unk>.

Single agent <unk> therapy, with a net favorable risk segment.

Yes, Steve it's Mike I'm not sure what data Youre looking at to come to those conclusions I think our view on that is.

Is markedly different in terms of how the share of all the different different.

Patrick J. Haley: But I think we've got great momentum there, and our story is just responding really well, as I referred to earlier. So I see... certainly, a lot more potential there. So, very pleased with the performance, and, you know, I think the 28% market share and really the first full quarter after launch are really just a great start and speaks well to the work of the team. And importantly, the data resonated. Got it, thank you. Your next question comes from the line of Peter Lawson from Barclays. Your line is now open.

Combinations or single agents are going down at a pretty good clip with the introduction of Cabo and <unk>.

So that's our view based upon both syndicated data as well as <unk>.

Internal market research, maybe P. J can provide some more some more color commentary there yeah and I would agree.

And we're certainly seeing significant uptake at the expense of other Io combinations and as we did say we are expanding the amount of.

[noise] combination utilization within the marketplace with the launch of problematic symbol and map. So by definition there were taking from other single agent. So that's probably be the correlation there and the and.

Peter Lawson: Hey, Mike. Thanks for the detail. Just around the aspirational guidance, is that something that would be updated on a kind of, annual basis or every couple of years? How do you think about that and how do you communicate that with the street? Yeah, thanks, Peter. I think you might have missed the question that Andy asked almost verbatim, exactly the same, and I won't repeat myself again. But, yeah, I already answered that question. So, let me go to this. That's not something you'll be thinking about updating every year or every couple of years.

And the prescription data, where you see student.

And poetry and kind of declining.

So I think it all makes sense, it's really being driven by <unk> and Evo taking share from from really across the board all competitors, but certainly I think first and foremost really.

The other combinations.

Alright, thanks for taking questions.

You bet.

Your next question comes from the line of Mike Inc. From H C. Wainwright. Your line is now open.

Mike you still there, yes, sorry, just try and get myself off mute and thanks for taking the follow up.

Don't want and we have 5 scale, but I just wanted to ask you guys about cosmic 312, and I presume that you will show the data to FDA before you presented at <unk>.

Michael M. Morrissey: Yeah, maybe you missed it when I answered the question previously with Andy, but yeah, we said we're not going to update that. That was an aspirational view of what success looked like prior to having any data. So, and it was based on the idea that if we were able to generate, you know, compelling, differentiating clinical data, that would define the market. Gotcha, would that be updated? Do you think after you get additional approvals, just to kind of, is that how you're thinking about those updates? I think I just answered the question, Peter.

Peer reviewed meeting so I guess, that's part a of the question.

Part B is.

<unk>.

Yeah.

And then express the.

Expectation that.

The overall survival end point will be futile.

Do you expect it to be and can't expect what the FDA will do but is that something that you think will have a I think it will have an issue with a filing.

And on that.

We're from the primary and thirdly, if they say that the study results here and adequate to file would you consider.

Peter Lawson: Kim, let's move on to the next question. Yeah, Peter, we do provide annual guidance, right? Annual yearly guidance, yeah. Perfect. Okay. Thanks much. Your next question comes from the line of Kenneth McKay from RBC Capital Markets. Your line is now open.

Taking <unk> <unk>, 2 and to that same setting rather than trying to run another study with Cabo.

Yes, So let me let me work backwards.

First as a high level this isn't a buzzkill question.

And we're proud of that data.

Great Great trial from the standpoint of execution during a time of day.

Ken Shields: Hey, Mike, I was hoping for that aspirational guy. No, I'm kidding. I'm kidding. Oh, please, ask it again. Come on, you can do it. I was actually, I did have a combo question. I can go on Cabo all day. I know you're getting a lot of information channeled back from your commercial teams, and I was hoping to hear some sort of any anecdotal evidence you're collecting for why docs are reaching for Cabo Nevo and Frontline RCC versus some of the competitive combos. There are many regimens out there.

Global Global upheaval and the team did a remarkable job and getting that done really on schedule. Both from the standpoint of enrolment as well as readout. So so kudos to them.

Disappointed that we didn't hit survival at the first interim and as we've said previously it's unlikely that we will not impossible, but unlikely. So we're trying to be transparent and direct with investors about expectations. That's old news, but that's yes. That's the game, we're in right and again, when the game and hazard ratios and P values and.

Beyond the run that we had since since since 2015, literally adding 1000 and that timeframe. So so.

It's not completely unexpected that things are going to go sideways once in a while especially with all the moving pieces of Covid. So so all that being said I'm.

Michael M. Morrissey: We've heard over and over again that docs prefer Cabo Nivo in more advanced tumors for Cabo's rapid effect, onset of effect. One of a lot, if you're seeing it all or hearing it all and increasing in those more advanced tumors, given the COVID-19 pandemic and decreased cancer surveillance and biomarker screening, or, you know, if that's not playing out, if there are any Thanks, and congrats again on the quarter.

And I'm not going to speculate on what the FDA might say, what they might do and now we have a trial that 1 of the 2 primaries hits.

With a very good hazard ratio and the appropriate.

Level of significance so with.

With no decrement and survival, which is the important framework there. So so a variety of kols that we've talked to you think that that's a provable, we'll see we'll talk to the agency and see when you see the data in terms of presentations is really more.

Michael M. Morrissey: Yeah, thank you. Yeah, let me say a few words, and then PJ can provide some additional color commentary. Look, again, the individual components, you know, Cavo and Nevo have been the mainstay within kidney cancer since, you know, their introductions back in the, you know, 2015, 2016 time frame. So there is a long history and familiarity with these two drugs. And to be quite frank, almost clamoring for the combination. I remember when, on July 21st, 2015, when our data and the B&M.

More and issue a win win.

When meetings will take place certainly with the complications from Delta meetings are being postponed are question marks about what will happen and when so our goal is to get the data out and the narrative behind what happened.

With the dichotomy between PFS and OS out as soon as possible.

Obviously, we have to we have to get alignment with the with the agency around filing and I think we have a good story to tell there, but we will see I'm not going to I'm not going to speculate on that.

For the fact and once we have information to share that's material in this context, we will we'll obviously share that with you in.

Michael M. Morrissey: When the data came out together, some of the initial feedback we got from KOLs. I mean, on the day of the top line results, they said, "let's start combining these molecules because you could really see some good activity if they were put together." So, there's been a history here.

In terms of next net.

Ex trials and that and this goes for.

Virtually everything beyond the context.

It will be done with overnight and 2 right and as we've said that previously so whether we are talking about about liver about more we know about lung about prostate.

Number of different.

Michael M. Morrissey: There's been momentum building for years. You know, the 90-R data exceeded expectations in terms of efficacy, tolerability, and quality of life. And, you know, one of the things that we really believe in. If you combine great data with a great team, you can really make headway very, very quickly. And to go from a standing start in January to having a leading, either a co-leading, or a leading share within five months is just a testament to the data that the clinical teams put together and then, you know, just the great commercial effort. So, again, I think the broad uptake speaks for itself, and we're looking to capitalize on that and build on that going forward. PJ, any other words?

Tumor types that we have seen activity with Cabo and in the past, but havent pursued in terms of full development, that's going to come down into the purview of about 92 going forward. So so but that obviously will get defined.

And the time ahead and and we're certainly.

Very excited about the opportunity and about all of these kind of collaborations that we've got now with various ICI doublets and triplets that we think and bring a lot of value. So it's a work in progress.

But hey, no no no excuses.

No hung hedged, we're going to just keep our eye and the ball and make sure that we can deliver every day for patients who need better therapies.

Okay. Thanks, so much you bet.

At this time there are no further questions and so I will turn the call over to today's host Susan Hubbard Ms Hubbard.

Patrick J. Haley: Yeah, no, I mean, I certainly agree. You know, there's the experience of physicians with these drugs and sort of, longstanding excitement to use them certainly helps really across the board. And, you know, we hear a lot of, I guess, anecdotes that are relevant to your question. But I don't really think they're very broad in the sense that I think physicians see the totality of the data in a way that they can find lots of different patients to utilize them in, you know, whether it's rapidly progressing patients, whether it's a favorable patient where they may be really thinking about the, you know, the tolerability profile if they view it favorably, which many do.

Thank you Brandy and thank you all for joining US today, we welcome your follow up calls with any additional questions. You may have that where we were unable to address during today's call.

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

And.

[music].

Patrick J. Haley: So I think there's, you know, what we see in it, it's really represented well in the NCCA guidelines is that it really gives them the option to use these broadly. And I think one thing we'll continue to see in the community is that they don't see as many kidney cancer patients on a per capita basis, so they get comfortable with Kabometics and Evo on kind of a trial basis. They really have the potential to use it, you know, use it across the board for all their kidney cancer patients.

Patrick J. Haley: And particularly, you know, when we started talking about the tolerability profile, really, the optimized 40 milligram dose daily has played really well in the combination. And I think that's really reframed how folks think about the tolerability profile of Kabomatics.

Patrick J. Haley: So it's great that we're able to do that well in combination. But, you know, I think it just has a lot of potential benefits for a variety of patients, positions, or makes sense. Thanks and congratulations again, guys. Thank you. Yeah, thank you. Your next question comes from the line of Krishibutani of Goldman Sachs. Your line is now open.

Ken Shields: Great, very much for the opportunity for the questions. Very healthy cash balance, obviously generating cash flow, very strongly derived from the Cabo success commercially. Can you comment upon how you're thinking about capital allocation strategies, remind me whether or not you have a share repurchase allocation, and maybe how frequently you sort of revisit the prioritization of those types of decisions? Thanks, Chris. It's Chris Center.

Chris Shibutani: So I think we'll break it down into a couple pieces, right? We're going to continue to do the BD that, you know, Mike talked about earlier. You know, the smaller deals look the same size of scope that we've been doing. We continue to look for, you know, other opportunities to continue to enhance the pipeline. And, you know, right now, we think that's the best investment for our cash balance. But, you know, Mike and I talk about capital allocation and cash utilization all the time.

[music].

Chris Shibutani: time, and we do that continually, and we do it in a way that we're trying to understand what's the best answer from a shareholder perspective and how do we return capital to shareholders. And so, you know, that's basically the way we do it. And do you have a share repurchase allocation currently? We do not have a share purchase allocation currently, but, you know, as I said, we continue to look at the capital allocation and see what's the best.

Chris Shibutani: And then in terms of the generic challenges, is there anything that you might be able to share with us updating on progress? I believe we are still on track for the trial in May of 2022. Anything on that front?

Michael M. Morrissey: Incremental news. Yeah, Chris, thanks. It's Mike.

Michael M. Morrissey: Yeah, nothing that I can really share here. You know, the process is the process, and I think it's evolving as we expect, but I really can't go into details publicly. Okay, and then finally, share the commentary and support for others with you. So obviously, you have a very strong clinical development bench on your team based upon Cabo's success. As you think about, you know, furthering the direction of that group of people, that core group of people, are there any different things that you're looking for, any strengthening, particularly as you think about the ADCs that are in your pipeline, just in terms of the C-suite and guiding some of those clinical decisions? Any updates there? Yeah, it's a good question. It's one that we're looking at very carefully, obviously. You know, we're never going to replace Gisla.

Michael M. Morrissey: I think that's, I think, a really fair way to look at it. We're looking to bring somebody in with, you know, their own unique skill sets, their own unique perspective, somebody who can help us go to the next level for the years to come. So it's one that, you know, Gisla has been, you know, a key, key part of this team.

Michael M. Morrissey: and this organization and building this culture and, you know, I want to, you know, take her opportunity, her success, her impact on the organization and help it go to the next level now. So, and she'll be part of that process, right? We talk on a regular basis.

Michael M. Morrissey: You know, we're brainstorming about opportunities and, you know, kind of candidates, those kinds of things already. So I'm looking forward to continuing that collaboration to be able to bring this next CMO in and help us go to the next level. Great. Thank you very much. I appreciate the answers.

Chris Shibutani: Thank you. Your next question comes from the line of Stephen Wiley from Cthel. Your line is now open.

Stephen Douglas Willey: Yeah, thanks for us, Suisamian, and congrats on the quarter and best wishes to Gisela. Just a quick question, I guess, with respect to utilization that might be occurring within specific subgroups or risk subgroups. I know that you're talking about seeing adoption across all risk risk subgroups, but I guess when I just kind of look at some of the TTI data, and I know that you're outpacing the market for the TKI market, but it looks like, I guess, both this quarter and last quarter, a lot of the share gains seem to be coming at the expense ofVotreants and Suitants, which we know are also the single agent TKI So just wondering if you guys have a sense as to how much of this initial adoption you're seeing in the frontline setting is a replacement of just single agent TKI therapy within that favorable risk segment.

Michael M. Morrissey: Yeah, Mike, I'm not sure what data you're looking at to come to those conclusions. I think our view on that is markedly different in terms of how the share of all the different, different, either combinations or single agents is going down at a pretty good clip with the introduction of Cabo and Evo. So that's our view based on both syndicated data as well as internal market research. Maybe PJ can provide some more color commentary there. Yeah, I would have too.

Patrick J. Haley: Agreed, it's, you know, we're certainly seeing significant uptake at the expense of other IO combinations, and as we did say, we are expanding the amount of, combination utilization within the marketplace with the launch of Kauometics-Bolomap. So by definition, there we're taking from other single agents, so that's probably the correlation there in the prescription data where you see Sutton and Votri kind of declining. So I think it all makes sense. It's really being driven by Kauffo Medics and Evo taking share from really across the board all competitors, certainly, I think first and foremost really the other. All right.

Stephen Douglas Willey: You bet, Steve. Your next question comes from the line of Mike King from H.E. Wainwright. Your line is now open. Mike, are you still there?

Michael George King: Thank you. Yeah, sorry, I was just trying to get myself off the mute. Thanks for taking the follow-up. Don't want to be a buzzkill, but I just want to ask you guys about Cosmect 312. And I presume that you'll show the data to FDA before you present it at a peer-reviewed meeting. So I guess that's, you know, part A of the question. Part B is, you know, having expressed the expectation that the overall survival endpoint will be futile, you know, be expected the, you can't expect what the FDA will do, but is that something that you think will have an issue with some filing on that? you know, with the primary.

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Michael M. Morrissey: And thirdly, if they say that the study results are inadequate to file, would you consider taking 092 into that same setting rather than trying to run another study with Cabo? Yeah, let me work backwards. First, at a high level, this isn't a buzzkill question.

Michael M. Morrissey: We're, you know, we're proud of that data. It was a great trial from the standpoint of execution during a time of, you know, global upheaval, and the team did a remarkable job in getting that done, really, unscheduled, both from the standpoint of enrollment as well as readout. So, so kudos to them.

Michael M. Morrissey: You know, disappointed that we didn't hit survival at the first interim. And, you know, as we said previously, it's unlikely that we will. Not impossible, but unlikely.

Michael M. Morrissey: So we're trying to be transparent and direct with investors about expectations. That's old news, but that's, you know, that's the game we're in, right? We're, again, in the game of hazard ratios and P values and, you know, being on the run that we've had since, since 2015, you know, we're literally batting a thousand in that time frame. So, so, it's not completely unexpected that things are going to go sideways once in a while, especially with all the moving pieces of COVID.

Michael M. Morrissey: So, so, um, all that being said, I'm not going to speculate on what the FDA might say, what they might do. Now, we have a trial that, you know, one of the two primaries hit with a very good hazard ratio and the appropriate level of significance, so with no decrement in survival, which is the important framework there.

Michael M. Morrissey: So a variety of KOLs that we talk to think that that's acceptable. We'll see. We'll talk to the agency and see. When you see the data in terms of presentations, it is really more an issue of when meetings will take place. Certainly, with the complications from Delta, meetings are being postponed or, you know, question marks about what will happen when. So our goal is to get the data out and the narrative behind what happened with the dichotomy between PFS and OS out as soon as possible.

Michael M. Morrissey: So, you know, obviously, we have to get alignment with the agency around filing, and I think we have a good story to tell there, but, you know, we'll see. I'm not going to speculate on that before the fact.

Michael M. Morrissey: And once we have information to share about this material in this context, we'll obviously share that with you. In terms of the next, you know, next trials, and this goes for virtually everything beyond the contacts, it'll be done with 092, right? And as we've said previously, so, you know, whether we're talking about liver, about more renal, about lung, about prostate, you know, any number of different tumor types that we've seen activity for with Kavana in the past but haven't pursued in terms of full development, that's going to come then into the purview of 092 going forward. So, so, but that obviously will get defined in the time ahead.

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Michael M. Morrissey: And we're certainly, you know, very excited about the opportunity and about all these clinical collaborations that we've got now with various ICI, doubles, and triplets that we think can bring a lot of value. So this is work in progress, but hey, no, no excuses, no, no hung heads.

Michael M. Morrissey: We're going to just keep our eye on the ball and make sure that we can deliver every day for patients who need better therapy. Thanks so much. I'll call you back. At this time, there are no further questions, and so I will turn the call over to today's host, Susan Hubbard.

Susan T. Hubbard: Yes, thank you, Francie. And thank you all for joining us today. We welcome your follow-up calls with any additional questions you may have that were unable to address during today's call. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect, and so on the end up. You know, and and and and and Thank You Thank you and and and and and and You and You and Thank Thank and and Thank you and and and and and and and and and and You and You and You You and and Thank you, Thank you. Thank you. I'm, and and and and and uh and B.