Q3 2021 Incyte Corp Earnings Call

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Hello, and welcome to the insight third quarter 2021 earnings call and webcast. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.

Operator: Hello, and welcome to the Incyte third quarter 2021 earnings call webcast. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. We ask that you please ask one question and one follow-up question, then return to the queue. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Christine Chiou, Head of Investor Relations. Please go ahead.

We ask you. Please ask one question and one follow up then return to the queue. If anyone should require operator assistance. Please press star zero on your telephone keypad. As a reminder, this conference is being recorded its now my pleasure to turn the call over to Christine <unk> head of Investor Relations. Please go ahead.

Thank you Kevin Good morning, and welcome to insights third quarter 2021 earnings conference call and webcast. The slides presented today are available for download on the investors section of our website join.

Christine Chiou: Thank you, Kevin. Good morning, and welcome to Incyte's third quarter 2021 earnings conference call and webcast. The slides presented today are available for download in the investor section of our website. Joining me on the call today are Herve, Barry, Steven, and Christiana, who will deliver their prepared remarks, and Dash, who will join us for the Q&A. Before we begin, I'd like to remind you that some of the statements made during the call today are forward-looking statements and are subject to a number of risks and uncertainties that may cause our actual results to differ materially, including those described in our 10-Q for the period ended June 30, 2021, and from time to time in our other SEC documents.

Joining me on the call today are Barry Steven and Christiana, who will deliver our prepared remarks and dash will join us for the Q&A.

Before we begin I'd like to remind you that some of the statements made during the call. Today are forward looking statements and are subject to a number of risks and uncertainties that may cause our actual results to differ materially including those described in our 10-Q for the period ended June 32021, and from time to time in our other SEC documents.

Now I'll begin the call with are they.

Thank you Christine and good morning, everyone.

Herve Hoppenot: Thank you, Christine, and good morning, everyone. I'm happy to report on an important quarter for Incyte. But before we do that, I would like to take a moment to speak about the significant transformation our company has undergone over the past two years. From the third quarter of 2019 to today, Incyte has more than doubled its number of approved products from three to seven and has increased the number of approved indications from 5 to 12, a significant achievement for patients around the world.

I'm happy to report today on an important quarter for insight, but before we do that I would like to take a moment to speak about the significant transformation our company has undergone.

Back to you.

From the software write off 2019 to today insights has more than doubled its number of approved products from three to seven.

Has increased the number of approved indications from five to 12.

Significant achievement for patients around the world.

Within the same time failure quarterly product and royalty revenues have grown 50% from 534 million to 778 million in the most recent quarter.

Herve Hoppenot: Within the same time period, quarterly product and royalty revenues have grown nearly 50 percent from $534 million to $778 million in the most recent quarter. The $778 million in product and royalty revenue for Q3 2021 does not yet reflect revenue contributions from our two most recent U.S. approvals, Obzellura in Atopic Dermatitis and Jakafi in Steroid Refractory Chronic GVHD. In addition, we expect further growth from the recent approvals of Pemazir in Europe and Japan and Minjuvi in Europe, where the launch is ongoing in Germany and will expand to other countries as reimbursement is secure.

The 778 million in product on the way up to a venue for Q3 'twenty to 'twenty, one does not yet reflect revenue contribution from our two most recently with a program of zero in that topic dermatitis jakafi in steroid refractory chronic gvhd.

In addition, we expect physical goods from the recent approvals of <unk>.

In Europe, and Japan and means Ravi in Europe, where the launch is ongoing in Germany and will expand to other countries as reimbursement is secured.

As you see on slide five we have provided long term guidance for some of these products and there is significant upside to the consensus number.

Herve Hoppenot: As you see on slide 5, we have provided long-term guidance for some of these products, and there is significant upside to the current sales numbers. For example, within Hematology Oncology, our MPN-GVHD franchise, which includes Jaka Fye and other innovations, is expected to surpass 3 billion pixels. Additionally, Montjuvi, approved for the treatment of relapsed or refractory DL-BCL, has the potential to reach 500 million in this indication in the U.S. While we have not provided guidance for Minjuvi, Pemezir, and Eichlusig, this product represents additional growth potential and generates further value to our business.

Within the metallurgy oncology MTN Gvhd franchise, which includes Jakafi and also innovation is expected to surpass 3 billion peak sales.

I just thought I'd, even one GB.

Approved for the treatment of relapsed or refractory <unk> has the potential to reach 500 million existing indications.

Why did we have not provided guidance in mutually vimizim accurate English Bullock represents additional growth, but I'm sure it feels on value to our business.

Turning to dermatology.

Herve Hoppenot: Turning to dermatology, over the past year, we have successfully established our dermatology commercial franchise in the U.S. Given the profile of Obselora and the talented commercial team we have in place, we are confident in the potential for Obselora, and we expect pixels to reach at least 1.5 billion patients in the U.S. for atopic dermatitis. While still very early in the launch of OBSERVA, the initial uptake has been strong, and Barry will be providing details in his prepared remarks.

We have successfully established our dermatology <unk> commercial franchise in the U S.

Given the product profile of upset or on the talented commercial team. We have in place we have confidence in the potential for all did well and we expect peak sales to reach at least 1.5 billion onions, the United States.

Alright, thank you.

While still very early in the launch of the initial uptake has been strong and Barry we'd be providing details in his prepared remarks.

Looking ahead in two other areas of our portfolio, we are anticipating multiple regulatory decision in 'twenty to 'twenty two.

Herve Hoppenot: Looking ahead to other areas of our portfolio, we are anticipating multiple regulatory decisions in 2022, including Roxolytinib cream for vitiligo in both the U.S. and Europe, Parfaclizib in three non-Hodgkin's lymphoma indications in the U.S., as well as once daily Roxolytinib late in 2022 or early 2020. This 2022 regulatory decision, which closely follows multiple product approvals in 2021, positions us well for further growth and diversification of our product revenues in the coming years.

Including a luxury today premiums did you like go in both the U S and Europe.

D SIB in Sweden that skins for my education in the U S as well as once daily luxuries late in 2022 early 2023.

2022 regulatory decision, which closely photo multiple product are providing 2021.

Additionally, waited for further growth and diversification of our product revenues in the coming year.

Our partners are also making headway with Novartis rock solid Gabe is currently under review in Europe, and Japan for acute and chronic gvhd and kept mezzanine is under review in Europe for non small cell lung cancer.

Herve Hoppenot: Our partners are also making headway. Novartis' Roxolytinib is currently under review in Europe and Japan for acute and chronic GVHD, and Capmatinib is under review in Europe for non-small cell lung cancer. In addition, Lilly is planning to submit an SNDA to the FDA for paracetamib in alopecia areata by the end of this year if it is approved. These opportunities will provide valuable growth to our royalty revenues, which have already surpassed $400 million during the first nine months of this year. As you have seen, 2021 will be an important year of commercial, clinical, and regulatory success for India. With that, I will hand over to Barry to cover the individual products. Thank you, everybody.

<unk> G D is planning to submit them to the FDA for positive maybe nettlefish salary at that by the end of this year.

If approved.

These opportunities will provide very little goes to our royalty revenues, which have already surpassed 400 million during the first nine months of this year.

As you have seen 2021 has been an important commercial clinical and regulatory success store inside.

With that I'll hand over to Barry to cover out of India resort product before.

Thank you Ravi and good morning, everyone.

Barry P. Flannelly: Thank you, Herve, and good morning, everyone. Jackify sales grew 12% year over year to reach $547 million for the quarter, and we are reiterating our full year guidance range of $2.125 billion to $2.17 billion. Jackify was the first approved treatment for myofibrosis polycythemia vera and thyroid refractory acute GVHD and years later remains the standard of care in each of these indications. Growth across MFPV and GVHD continues to be strong. And as you can see on the left, new patient initiation has returned to pre-pandemic levels.

Jakafi sales grew 12% year over year to reach 547 million for the quarter and we are reiterating our full year guidance range of $2 <unk> 5 billion to $2 $1 $7 billion.

Jakafi was first approved what's.

What's the first approved treatment in myelofibrosis polycythemia Vera in steroid refractory acute gvhd and years later remains the standard of care in each of these indications.

Growth across MF, PV and Gvhd continues to be strong.

And as you can see on the left new patient starts have returned to pre pandemic levels.

With patients staying on therapy longer and new patients coming in the total number of patients on Jakafi continues to increase year over year.

Barry P. Flannelly: With patients staying on therapy longer and new patients coming in, the total number of patients on Jackify continues to increase year over year. Myelofibrosis patients, the largest proportion of patients on Jackify, comprise 45% of total patients, while polycythemia vera and GVHD patients account for 34% and 14% of total patients, respectively. At the end of September, Jackify was approved for its fourth indication for the treatment of steroid refractory chronic GVHD. To put this recent improvement into perspective, approximately 2,000 patients with graft-versus-host disease are currently using Jackify, the majority of whom have the acute form of the disease.

Myelofibrosis patients the largest proportion of patients on Jakafi and comprised 45% of total patients, while polycythemia, Vera and gvhd patients accounts for 34% and 14% of total patients respectively.

At the end of September Jakafi was approved for its fourth indication for the treatment of steroid steroid refractory chronic gvhd.

To put this in this recent approval into perspective, approximately 2000 patients with graft versus host disease are currently using jakafi.

The majority of whom have acute form of the disease.

There are over 14000 patients in the U S living with chronic gvhd of which have required therapy beyond systemic corticosteroids. We expect the recent approval to accelerate new patient starts with Jakafi.

Barry P. Flannelly: There are over 14,000 patients in the US living with chronic GVHD, of which half require therapy beyond systemic corticosteroids. We expect the recent approval to accelerate new patient starts with Jackify. Turning to slide 8, Monjuby sales grew 22% sequentially to $22 million in the third quarter, with growth driven primarily by demand.

Turning to slide eight <unk> sales grew 22% sequentially to $22 million in the third quarter with growth driven primarily by demand.

We are seeing increase in the number of total accounts across both academic and community settings.

Barry P. Flannelly: We are seeing an increase in the number of total accounts across both academic and community settings, and there has been a swift shift towards adoption of Monjuvi earlier in the treatment paradigm. We now have a greater proportion of Montjuvi patients initiating therapy in the second line, which should result in patients experiencing longer and more durable responses, leading to a longer duration of therapy. Feedback from healthcare professionals continues to be positive, with efficacy, duration of response, and safety being the key drivers of adoption.

And there has been a swift shift towards adoption of Mt. Juvie earlier in the treatment paradigm. We now have a greater proportion of my jewelry patients initiating therapy in the second line, which should result in patients experiencing longer and more durable responses, leading to a longer duration of therapy.

Feedback from health care professionals continues to be positive with efficacy duration of response and safety being the key drivers of adoption.

Awareness of <unk> differentiated profile continues to increase.

Barry P. Flannelly: HCP awareness of Monjuby's differentiated profile continues to increase, and the L-Mind three-year results have been well received by the physician community. As patients continue to return to the office, and as our reps continue to educate healthcare professionals on the clinical profile of Monjuvi, we are confident in our ability to build on this improving momentum. Turning to slide 9, we are very excited to receive the approval of Opsalor, the first FDA-approved topical JAK inhibitor for the treatment of mild to moderate atopic dermatitis.

And the L mind, three year results have been well received by the physician community.

As patients continue to return to the office and as our reps continue to educate health care professionals and the clinical profile of mine Juvie, we're confident in our ability to build on this improving momentum.

Turning to slide nine we are very excited to receive the approval of <unk>. The first FDA approved topical JAK inhibitor for the treatment of mild to moderate atopic dermatitis.

Barry P. Flannelly: Prior to launch, we had identified 11,000 dermatologists and high-priority allergens, the top 20% of which are responsible for nearly 80% of atopic dermatitis prescriptions. Our patient assistance programs are in place to help reduce the barriers to access for Opsalora, and our negotiations with payers are progressing well. To date, we have made significant progress with our stakeholders in the launch of Opsalara. Since our launch on October 11th, our field-based representatives have actively engaged with 76% of our target prescribers and have conducted 8,500 HCP calls in the first three weeks of launch, of which 95% were conducted in person.

Prior to launch we had identified 11000 dermatologists and high priority Allergist.

The top 20% of which are responsible for nearly 80% of atopic dermatitis prescriptions.

Our patient assistance programs are in place to help reduce the barriers to access for opt to Lora and are in negotiations with payers are advancing well.

To date, we have made significant progress with our stakeholders and the launch of <unk>.

Since our launch on October 11th our field based representatives have actively engaged with 76% of our target prescribers and have conducted 8500 HCP cost in the first three weeks of launch of which 95% are being conducted in person.

We're also receiving a significant amount of interest in absolute euro from patients and in the first two weeks of launch we have approximately 61000 unique website users and this number continues to climb.

Barry P. Flannelly: We're also receiving a significant amount of interest in Opsalora from patients, and in the first two weeks of launch, we had approximately 61,000 unique website users, and this number continues to climb. Further highlighting the level of engagement from patients, there were over 1,500 patient registrations for our copay card program. And lastly, on the payer front, our discussions with PBMs, which include the top three who account for nearly 80% of commercially insured patients in the U.S., have been very positive as they realize the value proposition of Opsalora.

Further highlighting the level of engagement from patients there were over 500 patient registrations for our copay card program.

And lastly on the payer front, our discussions with Pbms, which include the top three who account for nearly 80% of commercially insured patients in the U S have been very positive as they realize the value proposition of absolute Laura.

As a result, we expect to secure broad coverage in Q1 of next year in the meantime. During this contracting period, we have multiple efforts underway to ensure patients are able to access their medications.

Barry P. Flannelly: As a result, we expect to secure broad coverage in Q1 of next year. In the meantime, during this contracting period, we have multiple efforts underway to ensure patients are able to access their medication. Although it is still early in the launch, our efforts are translating into the first signs of a very successful launch. As you know, there are limitations to the accuracy of script data. It is important to note that IQVIA's capture rate prescriptions are underrepresentative of actual demand, especially in the initial weeks of launch. However, over time, the capture rate is expected to continue to improve.

Although it is still early in launch our efforts are translating into the first signs of a very successful launch as you know there are limitations to the accuracy of script data is important to note that <unk> capture rate of prescriptions are underrepresented of of actual demand, especially in the initial weeks of launch overtime and capture rate is.

Expect it to continue to improve.

There are two different metrics that we're using to track performance consisting of new brands and new to brand <unk> and 867 data.

Barry P. Flannelly: There are two different metrics that we are using to track performance, consisting of new-to-brand RXs and 867 data. New Rx data, shown on the left, captures patients who are either new to the market or have switched to Opsalora. In the first two weeks of launch, there have been close to 1,000 new-to-brand prescriptions, with nearly two-thirds of scripts coming from patients who were previously on topical corticosteroid therapy. On the right-hand side, we are showing 867 data, which is the number of units of Opsalora 60-gram tubes that our wholesalers are shipping to pharmacies.

New Rx data shown on the left captures of patients who are either new to the market or have switched to ops Lora and the first two weeks of launch there have been close to 1000, new to brand prescriptions with nearly two third of scripts coming from patients who are previously on topical corticosteroid therapy.

On the right hand side, we're showing 867 data, which is the number of units of <unk> 60 Gram tubes that are wholesalers are shipping to pharmacies, while <unk> hundred 67 data doesn't translate directly into scripts. We believe it captures demand appropriately given the low level of inventory retail pharmacies typically hold for specialty dermatology.

Barry P. Flannelly: While 867 data doesn't translate directly into scripts, we believe it captures demand appropriately given the low level of inventory retail pharmacies typically hold for specialty dermatology products. Pharmacies order Opsalora when a prescription is received and approved by the patient's insurance or processed through our patient access program in its third week of launch. 1,115 tubes of Opsalora were shipped by wholesalers, bringing the total shipped since launch to over 2,200. Based on early data, we are now tracking towards 300-plus units shipped in the first four weeks of launch. Now, I'll turn the call over to Steven for a cleanup call.

<unk> products.

Pharmacies order <unk> when a prescription is received and approved by the patient's insurance are processed through our patient access programs.

In its third week of launch.

1115 tubes of ops, Laura was shipped by wholesalers, bringing the total shipped since launch to over 2200 based on early data. We are now tracking towards 300 plus units shipped in the first four weeks of launch.

Now I'll turn the call over to Steven for a clinical update.

Thank you Barry and good morning, everyone.

Third quarter brought numerous achievements on both the clinical and regulatory fronts.

Steven H. Stein: Thank you, Barry, and good morning, everyone. The third quarter brought numerous achievements on both the clinical and regulatory fronts. Starting with the three recent regulatory approvals. Mingevi was approved in Europe for second-line diffuse large B-cell lymphoma in August. In September, Opsalura was approved in the United States for mild to moderate atopic dermatitis, and Jackify was approved in the United States for second-line chronic graft-versus-host disease. In addition to these regulatory milestones and successes, we presented pivotal data from our Phase 3 True V studies of ruxolitinib and vitiligo at the European Academy of Dermatology and Venereology.

Starting with the three recent regulatory approvals <unk> was approved in Europe for second line diffuse large b cell lymphoma in August.

In September <unk> was approved in United States for mild to moderate atopic dermatitis and Jakafi was approved in the United States for second line chronic graft versus host disease.

In addition to these regulatory milestones and successes, we presented pivotal data from our phase III true <unk> studies of <unk> in vitiligo at the European Academy of Dermatology and Venereology.

The full dataset highlighted the significant improvements in facial and total body re pigmentation seen in vitiligo patients after treatment with <unk> cream.

Also presented at the Adv was positive pivotal data for <unk>, our partnered products with Eli Lilly in alopecia reorder. These.

Steven H. Stein: This full data set highlighted the significant improvement in Facial and Total Body Repigmentation Seen in Vitiligo Patients After Treatment with Ruxolitinib Cream. Also presented at EADV was positive pivotal data for baricitinib, our partnered product with Eli Lilly in alopecia areata. These data showed that treatment with once daily baricitinib, 4 mg, was superior to placebo in achieving significant scalp hair regrowth at 24 weeks in adults with severe alopecia areata.

These data showed that treatment with once daily <unk> four milligrams was superior to placebo in achieving significant scalp hair regrowth at 24 weeks in adults with severe alopecia every order.

We also announced a global collaboration with <unk> Pharmaceuticals, which is pending regulatory clearance to develop and commercialize <unk> an anti CSF one receptor monoclonal antibody for chronic graft versus host disease and other fibrotic diseases.

Steven H. Stein: We also announced the global collaboration with Syndex Pharmaceuticals, which is pending regulatory clearance to develop and commercialize Axitilumab, an anti-CSF-1 receptor monoclonal antibody for chronic graft-versus-host disease and other fibrotic diseases. Lastly, we recently announced the acceptance of the Marketing Authorization Application by the European Medicines Agency for Ruxelin cream and vitiligo. Yesterday, we announced that the FDA accepted the NDA for parseclusive in three types of non-Hodgkin's lymphomas. We also received priority review for PASTA-CLISP in two indications, including for relapsed or refractory marginal zone lymphoma in adult patients who have received at least one prior anti-CD20 base regimen, and Formentor Seldenberg, in adult patients who have received at least The PDUFA date for these two indications is April 30, 2022.

Lastly, we recently announced the acceptance of the marketing authorization application by the European Medicines agency for <unk> cream in vitiligo and yesterday, we announced that the FDA accepted the NDA for <unk> in three types of non Hodgkin's lymphomas.

We received priority review for <unk> in two of the indications, including for relapsed or refractory marginal zone lymphoma in adult patients who have received at least one prior anti CD 20, based regimen and for mantle cell lymphoma, and adult patients who have received at least one prior therapy.

<unk> date for these two indications is April 30th 2022.

There will be a standard review for <unk> in relapsed or refractory Follicular lymphoma, and adult patients who have received at least two prior systemic therapies with the Purdue for target action date of August 30 of 2022.

Let me remind you of the efficacy across non Hodgkin's lymphoma in relapsed or refractory marginal zone lymphoma.

Steven H. Stein: There will be a standard review for parsicless in relapsed or refractory follicular lymphoma in adult patients who have received at least two prior systemic therapies with a PDUFA target action date of August 30, 2022. Let me remind you of its efficacy across non-Hodgkin's lymphoma. In relapsed or refractory marginal zone lymphoma, response rates seen and independently reviewed were 57% with a duration of response and PFS not yet reached. In mantle cell lymphoma, this was 71% with a duration of response of nine months and a PFS of 11.19.

Response rates seen in independently reviewed with 57% with a duration of response and PFS not yet reached.

In mantle cell lymphoma. This was a 71% response rate with duration of response of nine months and a PFS of 11, one months and in relapsed or refractory Follicular lymphoma. There was a 75% overall response rate with duration of response of $14 seven months and a PFS of $15 eight months.

All this data is with the once daily regimen of two five milligrams.

I remember this drug was designed to avoid hepatic toxicity associated with first generation <unk> kinase Delta inhibitors, and thus we have seen low rates of liver toxicity with less than a 5% rate of grade three alt and AST elevations. In addition cases of serious diarrhea, and colitis were manageable and reversible.

Steven H. Stein: And in relapsed or refractory follicular lymphoma, there was a 75% overall response rate, with a duration of response of 14.7 months and a PFS of 15.8. All this data is with the once-daily regimen of 2.5 milligrams. Remember, this drug was designed to avoid hepatotoxicity associated with first-generation PR3 kinase delta inhibitors, and thus we have seen low rates of liver damage... with less than a 5% rate of grade 3 ALT and AST elevations. In addition, cases of serious diarrhea and colitis were manageable in reverse. Turning to the next slide.

Turning to the next slide the clinical development of <unk> in hemolytic anemia continues to progress with the phase III study expected to start by the end of this year.

The study will evaluate the efficacy and safety of <unk> versus placebo with a primary endpoint of durable hemoglobin response at week 24.

Patients must have a diagnosis of primary warm antibody autoimmune hemolytic anemia.

Hemoglobin levels of 7% to seven to 10 grams per deciliter, and a faster if score of less than or equal to 43.

Steven H. Stein: The clinical development of paraclysm in hemolytic anemia continues to progress, with a Phase III study expected to start by the end of this year. The study will evaluate the efficacy and safety of paraclysm-versed placebo with a primary endpoint of durable hemoglobin response at week 24. Patients must have a diagnosis of primary warm antibody autoimmune hemolytic anemia, hemoglobin levels of 7 to 10 grams per deciliter, and a FACET-F score of less than or equal to 43. This program represents another significant opportunity to address an unmet medical need where there are currently no approved therapies for patients. Moving on, to our limber development.

This program represents another significant opportunity to address an unmet medical need where there are currently no approved therapies for patients.

Moving to our Limber development program, we have multiple studies ongoing looking to improve upon the standard of care in myelofibrosis, Polycythemia, Vera and graft versus host disease, we expect data and a regulatory action for a few of these programs by the end of 2022.

Including the NDA submission for the once daily formulation of <unk>.

We also recently entered into collaboration with <unk>, an anti CSF one receptor monoclonal antibody, which is currently being evaluated as a monotherapy in third line chronic graft versus host disease.

In addition, we will have the opportunity to evaluate <unk> as a combination therapy with our JAK inhibitors with the ultimate goal would be to arrive at a safe and effective combination that could lead to a steroid free regimen for chronic graft versus host disease.

Christiana Stamoulis: We have multiple studies ongoing looking to improve upon the standard of care in milder fibrosis, polycythema vera, and graft-versus-host, We expect data and or regulatory action for a few of these programs by the end of 2022, including the NDA submission for the once-daily formulation of ruxolitin We also recently entered into a collaboration with Syndax for Axotilumab, an anti-CSF1 receptor monoclonal antibody, which is currently being evaluated as a monotherapy in third-line chronic graft-versus-host, In addition, we will have the opportunity to evaluate exotilamab as a combination therapy with our JAK inhibitor, where the ultimate goal would be to arrive at a safe and effective combination that could lead to a steroid-free regimen for chronic graft-versus-host disease. Turn Into Dermatology and Raxolidinib Cream in Vitiligo, The Phase 3 True V data presented at EADV showed meaningful superiority to vehicle, with 30% of patients achieving a facial VASI 75 at Week 24, which is in line with our Phase 2 results.

Turning to dermatology and <unk> cream in vitiligo phase.

Our phase III <unk> data presented at <unk> showed meaningful superiority to vehicle with 30% of patients achieving a facial vasey 75 at week 24, which is in line with our phase II results.

As a reminder, facial <unk> 75 response in the phase II trial continued to improve with <unk> cream treatment with an over 51% respond traded week 52.

We expect the 52 week data from the <unk> pivotal studies to be available in 2022.

We are extremely encouraged by these positive results and the impact of <unk> cream may have for patients living with vitiligo in the United States and Europe.

The MAA was recently validated by the European Medicines agency in the U S. S. NDA is in progress.

Turning to slide 18, and an update on our dermatology programs.

We continue to focus on developing our dermatology pipeline with <unk> cream, and incb, 547% or seven an oral selective Janus kinase one inhibitor <unk>.

Christiana Stamoulis: As a reminder, facial VASI-75 response in the Phase 2 trial continued to improve with ruxolidin cream treatment with an over 51% response rate at Week 52. We expect the 52-week data from the True V Pivotal studies to be available in 2022. We are extremely encouraged by these positive results and the impact ruxolidinib-CRE may have for patients living with vitiligo in the United States and Europe. The MAA was recently validated by the European Medicines Agency, and the U.S. SNDA is in progress.

Multiple studies ongoing with <unk> cream in atopic dermatitis, including true 83, a pivotal trial in atopic dermatitis in pediatric patients in.

In addition to our true V program in Vitiligo. We are also looking at 707 in a phase II study in patients with non segmental vitiligo with a body surface area of greater than or equal to 8%.

Additional studies for 707 are currently underway in other indications, including two phase III trials in higher Ed or not is Super Teva and <unk>. We look forward to updating you on these programs next year.

Christiana Stamoulis: Turning to slide 18 and an update on our dermatology pipeline, We continue to focus on developing our dermatology pipeline with Raxolym cream and INCB54707, an oral selective Janus kinase 1 inhibitor. Multiple studies are ongoing with ruxolidem cream for atopic dermatitis, including TRU-AD3, a pivotal trial for atopic dermatitis in pediatric patients. In addition to our True V program in vitiligo, we are also looking at 707 patients in a phase 2 study in patients with non-segmental vitiligo who have a body surface area of greater than or equal to 8%.

In closing, we had a very successful quarter with a number of clinical and regulatory accomplishments, including three approvals. The FDA acceptance of an NDA for <unk> as a treatment for three types of non Hodgkin's lymphomas and the EMA acceptance of the MAA for accident of cream as a treatment for vitiligo.

This week, we invite you to join an analyst and Investor call to discuss our Aro PD Lone program, including data for <unk> 650, <unk>, which was accepted for presentation at the <unk> annual Congress on November 13th.

With that I would like to turn the call over to Christiana for the financial update.

Christiana Stamoulis: Additional studies for 707 are currently underway in other indications, including two phase II trials in higher adrenitis suprativa and prurigo nodularis. We look forward to updating you on these programs next year. In closing, we had a very successful quarter with a number of clinical and regulatory accomplishments, including three approvals, the FDA acceptance of an NDA for postaclypse as a treatment for three types of non-Hodgkin's lymphomas and the EMA acceptance of the MAA for ruxolinib cream as a treatment for vitiligo.

Thank you Stephen and good morning, everyone.

Total product and royalty revenues for the third quarter were $778 million, representing a 25% increase over the third quarter of 2020.

Product and royalty revenues for the quarter.

Cries of net product revenues of $547 million for Jakafi and $48 million for other hematology oncology products.

Royalties from Novartis of $95 million for Jakafi, and $3 million four per Hector and royalties from Lilly of $87 million from Illumina.

Christiana Stamoulis: Later this week, we invite you to join an analyst and investor call to discuss our RLPD-L1 program, including data for H6-550, which was accepted for presentation at the CITSE Annual Congress on November 13. With that, I would like to turn the call over to Christiana for the financial update.

The 12% year over year growth in Jakafi net product sales reflects higher patient demand across all indications and a continued recovery of new patient starts as we will continue to emerge from the COVID-19 pandemic the.

The tripling of the Illumina as royalties due primarily to the use of ILUVIEN for the treatment of COVID-19.

Christiana Stamoulis: Thank you, Steven, and good morning, everyone. Our total product and royalty revenues for the third quarter were $778 million, representing a 25% increase over the third quarter of 2020. Total product and royalty revenues for the quarter are comprised of net product revenues of $547 million for Jakathai and $48 million for other hematology-oncology products, royalties from Novartis of $95 million for Jakathi and $3 million for Tabrekta, and royalties from Lilly of $87 million for Olu.

That agreement with Lilly for global net sales of ILUVIEN for the treatment of COVID-19 were entitled to receive royalties equal to the base.

Double digit rates applicable to all global net product sales plus an additional 13% royalty.

Moving onto our operating expenses on a GAAP basis ongoing R&D expenses of $331 million for the third quarter increased 11% from the prior year period, primarily due to the progression of our pipeline.

Our SG&A expense for the quarter of $191 million increased 58% from the prior year quarter, primarily due to our investments related to the establishment of the new dermatology commercial organization in the U S and the related activities to support the launch of <unk> for atopic dermatitis.

Christiana Stamoulis: The 12% year-over-year growth in Jaka Fye Net Product sales reflects higher patient demand across all indications and a continued recovery of new patient starts as we continue to emerge from the COVID-19 pandemic. The tripling of the Olumient royalties is due primarily to the use of Olumient for the treatment of COVID-19. There is an agreement with Lilly for global net sales of aluminum for the treatment of COVI

Our collaboration loss for the quarter was $9 million, which represents our 50% share of the U S. Net commercialization loss for one Julie.

This is comprised of total net product revenues of $22 million and total operating expenses, including Cogs and SG&A expenses of $40 million.

Operator: We are entitled to receive royalties equal to the base double-digit rates applicable to all global net product sales, plus an additional 13% royalties. Moving on to our operating expenses on a gap basis, ongoing R&D expenses of $331 million for the third quarter increased 11% from the prior year period, primarily due to the progression of our pipeline. Our SG&A expense for the quarter of $191 million increased 58% from the prior year quarter, primarily due to our investments related to the establishment of the new dermatology commercial organization in the new U.S. and the related activities to support the launch of Opselura for atopic dermatitis.

Finally, our financial position continues to be strong as we ended the quarter with approximately $2 $3 billion in cash and marketable securities.

Moving on to our guidance for 2021, we are reiterating our revenue Cogs R&D and SG&A guidance for the year, we remain confident in our full year guidance for Jakafi based on our continued recovery of new patient starts and the approval in steroid refractory chronic gvhd.

Operator that concludes our prepared remarks, please give your instruction set up in the call for Q&A.

Thank you, we'll now be conducting a question and answer session. We ask you. Please ask one question and one follow up then return to the queue, if you'd like to be placed in the question queue. Please press star one on your telephone keypad alcohol formation tone will indicate your line is in the question queue. You May press star two if you'd like to remove your question from the queue for participants.

Operator: Our collaboration loss for the quarter was $9 million, which represents our 50% share of the U.S. net commercialization loss for Mongolia. This is comprised of total net product revenues of $22 million and total operating expenses, including COGS and SJ&A expenses of $40 million. Finally, our financial position continues to be strong as we ended the quarter with approximately $2.3 billion in cash and marketable securities. Moving on to our guidance for 2021, we are reiterating our revenue, COGS, R&D, and SG&A guidance for the year.

Using speaker equipment, it may be necessary to pick comprehensive before pressing star one and once again, we ask you. Please ask one question and one follow up then return to the queue. Our first question is coming from <unk> from Bank of America. Your line is now live.

Hi, guys. Good morning, Thank you for taking my questions.

I'm going to focus on.

Atopic derm, so it looks like out of the gate as you mentioned the metrics are looking pretty strong can you give us an idea of what are the physicians that are picking up used initially is there a particular patient population that youre hearing that doctors want to try this out on first liens feedback from euro.

Operator: We remain confident in our full year guidance for JAKA5 based on our continued recovery of new patient starts and the approval in steroid refractory chronic GVHD. Operator, that concludes our prepared remarks. Please give your instructions and open the call for Q&A.

Sales force.

And if you were to say right now what is your biggest.

I guess roadblocks to pick up is it getting on insurance formulary or is it just trying to educate doctors on the product. Thank you.

Operator: Thank you. We will now be conducting a question and answer session. We ask that you please ask one question and one follow-up question, then return to the queue. If you would like to be placed in the question queue, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing star 1. And once again, we ask that you please ask one question and one follow-up question, then return to the queue. Our first question is coming from Tazina Mott from Bank of America. Your line is now live.

Yeah.

Hi, it's Barry Thanks, Susan.

First thing I'd like to say is that I realize I said that we were going to ship.

In my prepared remarks 300 tubes of.

<unk> in the first four weeks and of course, I meant 3000 tubes, which would actually make it.

On par or better than the last two launches in atopic dermatitis. So we expect those 3000 shipments to pharmacies to actually translate into more than 3000 prescriptions in the first full four weeks of.

Of our launch so what patient population are they are really looking at it.

It's just the indication essentially patients who are 12 years or older.

Tazeen Ahmad: Hi guys, good morning. Thank you for taking the time to answer my questions.

There is no difference I have spoke to many dermatologists spoken to many dermatologist and they're confident that they can use this drug in and teams all the way up to.

Barry P. Flannelly: I'm going to focus on atopic derm. So it looks like out of the gate, as you mentioned, the metrics are looking pretty strong. Can you give us an idea of what the physicians that are picking up will use initially? Is there a particular patient population that you're hearing that doctors want to try this on? And if you were to say right now, what is your biggest, I guess, roadblock to picking up, is it getting on insurance formulary, or is it just trying to educate doctors on the product? Thank you.

The older adults so the biggest roadblock.

Patient access as always.

An interesting problem at the beginning.

Of a launch but in fact, I think we're making great headway there and as I said in my prepared remarks, I think we will in fact have broad coverage in the first quarter of next year.

As you know when new products are launched particularly products like this in dermatology sometimes.

The Big Pbms will just block you for.

Six months or more and we think we can overcome that.

Barry P. Flannelly: Hi, it's Barry. Thanks, Tazeen. The first thing I'd like to say is that, in my prepared remarks, I said that we were going to ship 300 tubes of Opsalora in the first four weeks. And, of course, I meant 3000 tubes, which would actually make it on par or better than the last two launches in atopic dermatitis. So we expect those 3000 shipments to pharmacies to actually translate into more than 3000 prescriptions in the first full four weeks of our launch. So what patient population are they really looking at? It's just the indication, essentially, patients who are 12 years or older. There's no difference.

<unk> is possible.

We've presented many times to payers across the country Big and small players with our clinical data and Theyre really impressed by the value that opt to Laura will provide to these patients.

So even though it is always a berry are worried about patient access I think we're going to be fine in the relatively near future.

As you know and in fact.

When they start a new year is really when you.

Do you want to.

Ensure that your formulary is fully blown out and all of your.

Barry P. Flannelly: I've spoken to many dermatologists, and they're confident that they can use this drug in teens all the way up to, you know, older adults. So the biggest roadblock, patient access is always an interesting problem at the beginning of a launch, but in fact, I think we're making great headway there. And, as I said in my prepared remarks, I think we will indeed have broad coverage in the first quarter of next year.

Customers know exactly whats going to be covered and what's on the formulary. So we think in the beginning of the year, we'll have a good progress there.

Thanks, Mary and just to clarify do you know how long it's taking from the time the Doctor writes a script to the time that patients receiving product in the early days of the lunch.

It's a it's very early I can't give you a medium or an average.

Some patients are obviously have to have prior approval other patients go through our our insight <unk> patient assistance program.

Barry P. Flannelly: As you know, when new products are launched, particularly products like this in dermatology, sometimes the big PPMs will just block you for six months or more. And we think we can overcome that as quickly as possible. We've presented many times to payers across the country, big and small payers, with our clinical data, and they're really impressed by the value that Opthalura will provide to these patients. So even though it is always a barrier to patient access, I think we're going to be fine in the relatively near future.

I'm sure some patients are getting it very quickly and other patients who might take a few days, but I don't I don't have an average for you yet.

Thank you. Our next question today is coming from Brian Abrahams from RBC. Your line is now live.

Hey, guys. Thanks, so much for taking my question.

Question on the MFS dynamics overall, it looks like <unk>.

Cycle looks like patient volumes been very stable year over year in MF.

For Jakafi and Youre seeing a lot of the growth being driven by the other indications I'm. Just wondering if you could talk about I guess, what goes into your out year guidance in terms of overall market dynamics across the indications and then.

Barry P. Flannelly: As you know, in fact, when they start a new year is really when you want to ensure that your formulary is fully blown out, and all of your customers know exactly what's going to be covered and what's on the formulary. So we think at the beginning of the year, we'll have good progress there.

As we think about sort of longer term.

You didn't talk too much about the ongoing phase two phase one to work for the bet and <unk> and just sort of wondering.

Barry P. Flannelly: Thanks, Barry. And just to clarify, do you know how long it takes from the time the doctor writes the script to the time the patient is receiving the products in the early days of the launch?

Where those stand and your level of confidence that that can drive a potential growth and durability in the Ms indication.

Barry P. Flannelly: I don't. It's very early. I can't give you a medium or an average.

Barry P. Flannelly: Some patients obviously have to have prior approval. Other patients go through our Incyte CARES patient assistance program. I'm sure some patients are getting it very quickly, and other patients it might take a few days, but I don't have an average for you.

Sure. This is Barry I'll start and then hand, it over to Stephen for a bad enough to and where they stand but as you can see from the slide that we showed the remarkable thing about jakafi is that <unk>.

After month year after year. The total number of patients on Jakafi continues to increase whether its MF PV or gvhd. The number of patients who are on MF and MF for a very long period of time.

Brian Corey Abrahams: Thank you. Our next question today is coming from Brian Abrahams from RBC. Your line is now live.

Barry P. Flannelly: Hey guys, thanks so much for taking my question. I have a question on the MS dynamics overall, and life cycle. It looks like patient volumes have been very stable year over year in MS for Jackify, and you're seeing a lot of growth being driven by the other indications. Just wondering if you could talk about, I guess, what goes into your guidance in terms of overall market dynamics across the indications.

Our is amazing in fact, we.

We know that we've really only penetrated about 50% of the market. Our biggest competition is really a watch and wait so getting physicians to fully understand the survival benefit that jakafi offers to myelofibrosis.

<unk> patients is really what our challenges and we know we're making headway all the time as I said in my at the beginning of my prepared remarks that myelofibrosis PV Gvhd. The standard of care is jakafi and it will continue to be that way.

Barry P. Flannelly: And then, as we think about sort of longer term, you didn't talk too much about the ongoing phase two, phase one, two work for BET and ALK2, and I was just sort of wondering where those stand and your level of confidence that that can drive potential growth and durability in the MF indication. Thanks.

Patient same thing they continue to grow.

Year after year month, after month, and Gvhd, especially for chronic gvhd, we know is going to grow very well those patients are at a prevalence of those patients are greater than a prevalence of acute gvhd patients and.

Barry P. Flannelly: Sure, this is Barry. I'll start and then hand it over to Steven for a bit, and I'll tell you where they stand.

The chronic gvhd patients stay on for a much longer period of time.

Barry P. Flannelly: But as you can see from the slide that we showed, the remarkable thing about Jackify is that month after month, year after year, the total number of patients on Jackify continues to increase, whether it's MF, PV, or GBHD. The number of patients who are on MF for a very long period of time is amazing, in fact. We know that we really only penetrate about 50% of the market. Our biggest competition is really just to watch and wait.

So I'll hand, it over to Stephen now for better outcomes.

Thanks, Barry Brian. Thanks for your question. So let me deal with each separately, firstly I'll start with <unk>, which is a mechanism now we have data in hand, we understanding more and more so if you look at iron metabolism in humans.

<unk> side in the way. It works is high levels of <unk> inhibits iron absorption from the gastrointestinal tract and stop it released from macrophages. So theres less on available to make red blood cells. If you. If you are able to inhibit the <unk> pathway through an <unk> two inhibitor <unk> released in May.

Barry P. Flannelly: So getting physicians to fully understand the survival benefit that Jackify offers to myelofibrosis patients is really what our challenge is, and we know we're making headway all the time. As I said at the beginning of my prepared remarks, in myelofibrosis, PV, GBHD, the standard of care is Jackify, and it will continue to be that way. PV patients, same thing. They continue to grow year after year, month after month, and GBHD, especially for chronic GBHD, we know is going to grow very well.

Available.

Both from absorption in both for macrophages to make new Red blood cells, and we've shown that this compound.

Is that from a mechanism of action point of view, so where we are so we're very excited about its potential we complete in the monotherapy safety and then the combo safety and then we'll be ready to make more decisions on the path forward in terms of more pivotal studies, which let me remind you, which I've said repeatedly we will hopefully.

Barry P. Flannelly: The prevalence of those patients is greater than the prevalence of acute GBHD patients, and chronic GBHD patients stay on for a much longer period of time. So I'll hand it over to Steven now for a bet, and I'll quit.

The address both the anemia of the underlying disorder, which we think is <unk> mediated plus the anemia induced by <unk>, which we also think is <unk> mediated and if we achieve both of those you'll get.

Steven H. Stein: Thanks Barry and Brian, thanks for your questions. So, let me deal with each question separately.

Steven H. Stein: Firstly, I'll start with ELK2, which is a mechanism now that we have data in hand that we understand more and more. So if you look at iron metabolism in humans, hepcidin, the way it works is high levels of hepcidin inhibit iron absorption from the gastrointestinal tract and stop its release from macrophages. So there's less iron available to make red blood cells. If you are able to inhibit that hepcidin pathway through an ELK2 inhibitor, iron is released and made available both from absorption and from macrophages to make new red blood cells. And we've shown that this compound does that from a mechanism of action point of view.

The safety aspect and less discontinuation when it works and then maintain rex into them dose and enhance efficacy. So the program really has a lot of potential.

We hope to have a recommended phase II.

Combo dose ready to go early next year, and then make those decisions.

For the bet program again, a compound we've had in our hands for a long time years ago, we dosed it to much higher multiples in patients with solid tumors in the dose limiting toxicity. There as we know with bet inhibitors was was on target and with thrombocytopenia.

We now dosing it at 2025% of where we were before gathering monotherapy safety in Molla.

<unk> predictive neoplasm patients and then and then combos safety and then we will again just like with the old program have to make decisions on where to go looking at the competitive space as well.

Steven H. Stein: So where we are, we're very excited about its potential. We're completing, you know, the monotherapy safety and then the combo safety, and then we'll be ready, you know, to make more decisions on the path forward. In terms of more pivotal studies, which let me remind you, which I've said repeatedly, will hopefully address both the anemia of the underlying disorder, which we think is hepcidin mediated, plus the anemia induced by ruxolitinib, which we also think is hepcidin mediated. And if we achieve both of those, you'll get, you know, the safety aspect and fewer discontinuations So the program really has a lot of potential.

Would we be looking gives.

Given this profile at suboptimal patients and in addition would be considered first line. So those those datasets for the mono safety in the Comverse safety will be available in 2022 and as soon as we're ready and put up on 10 trials took off we will be able to show you our clinical programs there, but we are comfortable where they are at the moment. Thanks.

Stephen and Barry Thanks, so much.

Thank you. Our next question is coming from Cory CASM all from Jpmorgan. Your line is now live.

Hey, good morning, guys. Thank you for taking my questions I wanted to go back to obsolete.

Now that you're early on in the launch and deep in discussions with payers curious if youre thinking around expectations for gross to net have changed at all how we should be thinking about this short term and then kind of longer term trends on this front and then the follow up is as we think ahead to the anticipated approval of <unk>.

Steven H. Stein: We hope to have a recommended phase two combo dose ready to go early next year and then make those decisions. For the BET program, again, a compound we've had in our hands for a long time, years ago, we dosed it at much higher multiples in patients with solid tumors, and the dose-limiting toxicity there, as we know with BET inhibitors, was on target and was thrombocytopenia. We're now dosing it at 20, 25% of where we were before, gathering monotherapy safety in myeloproliftive neoplasm patients and then combo safety, and then we'll again, just like with the old program, have to make decisions on where to go, looking at the competitive space as well.

Laura for vitiligo.

How did the tubes per patient likely defer for a typical patient in that setting versus atopic derm. Thank you.

Hey, Cory it's Barry.

So what are we thinking about the gross to net is that.

What we said in the past is that long term, we anticipate the gross to net to be 25% to 50%, but in this quarter in particular and then as we move into next year. The gross to net will be much higher just because of the LTC blocks and patient assistance programs that we provide co pay assistance and as you know in this.

Steven H. Stein: Would we be looking, given its profile, at suboptimal patients, and, in addition, would we consider first line? So those data sets for the monosafety and the combo safety will be available in 2022, and as soon as we're ready and have it up on clintrials.gov, we'll be able to show you our clinical programs there. But we're comfortable where they are. Stephen.

Therapeutic category over time to.

The use of those programs.

Declines as Theres more broader coverage so our gross to net will continue to improve.

<unk>, maybe I'll start out and handover.

Barry P. Flannelly: Steven and Barry, thanks so much.

Steven.

Barry P. Flannelly: Thank you. Our next question is coming from Corey Kazama from JP Morgan. Your line is now live.

We know it's going to be greater I think we forecasted perhaps we said that we think in atopic dermatitis, three or more tubes will be used per year.

Reni John Benjamin: Hey, good morning guys. Thank you for taking my questions. I wanted to go back to OpsAlert.

<unk> tubes per year, perhaps for vitiligo I.

I forget exactly what the clinical trial, what was how many tubes, we got but obviously, we want to patients are going to use this for $24 52 weeks.

Barry P. Flannelly: I wanted to go back to Opsalura, and now that you're early on in the launch and deep in discussions with payers, curious if your thinking around expectations for gross to net have changed at all, how we should be thinking about this short term and then, you know, kind of longer term trends on this front, and then the follow-up question is, as we think ahead to the anticipated approval of Opsalura for vitiligo, how Thank you. Hey Corey, it's Barry.

And we'll see how much further after that but I'll, let Stephen comment as well thanks, Barry Thanks Corey.

The data in my prepared remarks for the true the phase III studies, thus far have completely replicated the phase II data in terms of the facial <unk> 75 at 24 weeks here in the 30% plus range, we know from the 52 week and the 104 week long term follow up.

On our phase II studies that one of the Phenomenons with treating vitiligo is continued improvement over time and in fact, most of the patients. The vast majority elected to go on too long term treatment in the long term safety extension because of continued improvement so what barry's alluding to.

Barry P. Flannelly: So what we're thinking about the gross net is that, you know, what we said in the past is that, long term, we anticipate the gross net to be 25 to 50%. But in this quarter, and then as we move into next year, the gross net will be much higher, just because of the NDC blocks and the patient assistance programs that we provide copay assistance. And as you know, in this therapeutic category, over time, the use of those programs declines as there's more broad coverage.

As his continued use over time and over a one year period. The current estimate is at least 10 to 11 60 Gram tubes would be needed to achieve what I just spoke about and then we will get more data in the second year and as we continue to follow these patients.

That's helpful. Thanks, guys.

Barry P. Flannelly: So our gross net will continue to improve. For vitiligo, maybe I'll start out and hand over to Steven. You know, we know it's going to be greater. You know, I think we've forecasted, perhaps we said that, you know, we think in atopic dermatitis, you know, three or more tubes will be used per year, 10 tubes per year, perhaps for vitiligo. I forget exactly what the clinical trial was, how many tubes we got. But obviously, we want to, patients are going to use this for 24, 52 weeks. And we'll see how much further after that. But I'll let Steven comment as well.

Thank you. Our next question today is coming from <unk> Honda from <unk> Securities. Your line is now live.

Hey, guys. Thank you so much for taking my question.

So it depends on the popular that atopic derm and the regular regulatory progress in the July call. It looks like the dermatology franchise is off to a great Jack now.

We also have additional trials going on can.

Can you talk about how you're thinking about the future of the franchise given what you've already targeted with drugs would you be looking for something to complement that or should we expect.

I think more broad.

Steven H. Stein: Thanks Barry, thanks Corey. The data in my prepared remarks for the TRU-V phase 3 studies thus far have completely replicated the phase 2 data in terms of the facial valsity 75 at 24 weeks hitting the 30% plus range. So what Barry is alluding to is continued use over time, and over a one-year period, the current estimate is that at least 10 to 11 60-gram tubes would be needed to achieve what I just spoke about, and then we'll get more data in the second year as we continue to follow these patients. Thanks.

Thank you.

Right.

Here on the student who will speak about the.

The specifics of what's going on in <unk>.

Beyond dermatology.

With our current portfolio. So what idea from the beginning was that we do.

Search and discovery of new product somewhere.

In between immunology inflammation and cancer, so some product out typically cancer product, but many of the products targeted therapies type of product antibody that because rob but many of the mechanism. We are studying in fact have applications outside of cancer and Thats, where it's Tim So that's where it started and what we see.

Srikripa Devarakonda: That's helpful. Thanks, guys. Your next question today is coming from Srikripa Devarakonda from Truist Security. Your line is now live.

When you look at.

<unk>.

Then plus.

Herve Hoppenot: Herve here, and Stephen will speak about the specifics of what's going on in DERM and beyond DERMatology with our current portfolio. I mean, the whole idea from the beginning was that we do... Research and Discovery of New Products Somewhere Between Immunology, Inflammation, and Cancer So some products are typically cancer products, but many of the products, targeted therapies type of products, antibodies, etc., but many of the mechanisms we are studying actually have applications outside of cancer. And that's where it came from; that's where it started.

Mechanisms that we are studying in early studies is that they can have applications outside of cancer. That's what we found with <unk>.

<unk> is that in.

<unk> anemia, so that's what we see in many dermatology indications. So the goal is really to continue on that thought of photos of sounds.

Type of approach.

And obviously because diameter.

While metallurgy of gene.

Sure.

The largest immune inorganic I guess.

We see a lot of applications in dermatology in the short term, but it could also go in the type of inflammatory immune type of disease.

Herve Hoppenot: And what we see today, when you look at the, you know, 10 plus mechanisms that we are studying in early studies, is that they can have applications outside of cancer. That's what we found with PI3 kinase delta in hemolytic anemia. That's what we see in many dermatology indications. So the goal is really to continue with that sort of follow the science type of approach. And obviously, because the skin is the largest immune organ, I guess. We see a lot of applications in dermatology in the short term. But it could also go in other types of inflammatory immune type of disease.

Maybe Stephen if you include.

Yes.

And Chris Thanks for the question So service right the way, we view in dermatology and I'm glad you called it a franchise even from an R&D point of view is absolutely not a one and done so theres lifecycle management of the cream itself ongoing within a topic dermatitis in some of the manifestations thereof.

Chronic hand, eczema et cetera.

There is still questions to be Austin addressed in vitiligo, including what happens with in patients on for the long term with with <unk>.

Really good improvements in facial <unk> 90, and beyond and what happens with withdrawal in those situations and then beyond those indications as <unk> was alluding to given the mechanism of action of the cream in terms of JAK stat pathway. There are a number of other indications that we're extremely interested in addressing which are actually relatively.

Steven H. Stein: Maybe, Steven, if you want. Thank you, Herve and Kripa. Thanks for the question.

Steven H. Stein: with, in patients on for the long term with, you know, really good improvements in facial vaseline 90 and beyond, and what happens with withdrawal in those situations. And then beyond those indications, as Herve was alluding to, given the mechanisms of action of the cream in terms of the JAK-STAT pathway, there are a number of other indications that we're extremely interested in addressing, which are actually relatively, from an R&D point of view, certainly in an oncology context, really easy to study in terms of time. So, you know, stay tuned.

From an R&D point of view certainly within oncology context really easy to study in terms of time.

Stay tuned we view this now as a.

As a lifecycle management opportunity with the scale that we.

We can address in a very very efficient manner, and then because to them as U S.

As others have said they are alluding to has become really important to insight both from an R&D and then our commercial point of view, it's beyond in terms of other compounds. So I alluded to in my prepared remarks with 540 <unk> hundred seven a relatively JAK one specific oral inhibitor that there are other indications for which we already have really good.

Steven H. Stein: We view this now as a lifecycle management opportunity with a scale that we can address in a very, very efficient manner. And then because dermis, as you also, as others have said, they're alluding to, has become really important to insight, both from an R&D and then a commercial point of view, it's beyond in terms of other compounds. So I alluded in my prepared remarks with 54707, a relatively JAK-1 specific oral inhibitor, that there are other indications for which we already have really good phase 2 data in higher adrenitis suprativa.

Phase II data in higher Ed Youre, not as Super Teva, we have an ongoing phase two b theyre in approximately 200 patients that will deliver data next year and then we can make a decision on what to do from a pivotal aspect. We are studying that compounding prurigo <unk> again, the mix of action is very relevant there and then in my prepared remarks four four.

Non segmental vitiligo with body surface areas of total body surface area involvement of 8% or greater we think the risk benefit may well be favorable for an oral JAK. There. So you can see that.

I'm thinking from an R&D point of view is expanded in an appropriate proportional way and it's relatively efficient to do so thanks for the question.

Steven H. Stein: We have an ongoing phase 2b trial there in approximately 200 patients that will deliver data next year, and then we can make a decision on what to do from a pivotal aspect. We're studying that compound in prurigo nodularis.

Thank you Paula Hi, Thank you for all the color.

Thank you. Our next question today is coming from Celgene Richter from Goldman Sachs. Your line is now live.

Good morning, Thanks for taking my question. So Beth job. So Laura could you just give us any qualitative feedback youre getting on the launch and with with regard to this.

Steven H. Stein: Again, the mix of action is very relevant there. And then, in my prepared remarks, for a non-segmental vitiligo with body surface areas of total body surface area involvement of 8% or greater, we think, you know, the risk benefit may well be favorable on oral JAK there. So you can see, from an R&D point of view, the derm thinking has expanded in an appropriate proportional way, and it's relatively efficient to do so.

Safety profile.

In the context of which population so would they be looking to come notorious for instance, and then.

In vitiligo is there any change to the outlook for market.

Yeah.

<unk> Barry.

So.

Steven H. Stein: So thanks. Thank you so much. I appreciate all the colors. The question today is coming from Salveen Richter from Goldman Sachs. Your line is now: Good morning. Thanks for taking my question. So back to Apsalura.

Regarding the safety and a black box I guess youre alluding to is that dermatologists are very used to.

Explaining to patients the difference between a systemic product in a topical product.

Salveen Richter: Thank you. The next question today is coming from Salveen Richter from Goldman Sachs. Your line is now live.

For most skin diseases in fact, dermatologist would rather use a topical product.

So they know that for example that the safety profile between oral JAK inhibitor and a topical JAK inhibitor is going to be very different and so they're very they're very comfortable with that as I said before I've spoken to many dermatologists, we've gotten a lot of feedback from the field there really hasnt been a pushback on the types of patients they're going to use this.

Barry P. Flannelly: Hi Salveen, it's Barry. So regarding the safety of a black box, I guess you're alluding to the fact that dermatologists are very used to explaining to patients the difference between a systemic product and a topical product. For most skin diseases, in fact, dermatologists would rather use a topical product. So they know that, for example, the safety profile between an oral JAK inhibitor and a topical JAK inhibitor is going to be very different. And so they're very comfortable with that.

Absolutely right and.

So it is approved for the indication from 12 and over and Thats, what they are telling us they're going to use it for in terms of.

Combo use I don't know, sometimes they do cycle through dermatologist will cycle through different therapies as they are trying to control patients with atopic dermatitis.

Barry P. Flannelly: As I said before, I've spoken to many dermatologists. We've gotten a lot of feedback from the field. There really hasn't been any pushback on the types of patients they're going to use Opsalora in. So it's approved for the indication from 12 and over, and that's what they're telling us they're going to use it for. In terms of combination use, I don't know

But we can't say in the future of what Theyre going to do in terms of in terms of vitiligo.

It's a game changer, it can change patients' lives and how they feel about themselves as the only drug.

That'll be approved for <unk>.

Pigmentation.

<unk>.

And we really think that's going to be something that Ah patients and dermatologists to health care providers.

Barry P. Flannelly: Sometimes they do cycle through, dermatologists will cycle through different treatments as they're trying to control patients with atopic dermatitis, but we can't say in the future what they're going to do. In terms of vitiligo, you know, it's a game changer. It can change patients' lives and how they feel about themselves. It's the only drug that will be approved for repigmentation of the skin, and we really think that's going to be something that patients and dermatologists, healthcare providers, and others will want to utilize because it is such a unique treatment and is going to help maybe hundreds of thousands of patients, if not more, live a better life, I think.

Want to utilize.

Because it is such a unique treatment and is going to help maybe hundreds of thousands of patients if not more.

Live a better life I think.

Thank you.

Thank you. Our next question is coming from Jay Olson from Oppenheimer. Your line is now live.

Oh, hey, thanks for taking the questions and congrats on the three parts of the filings and acceptance is.

Can you comment on Ftes rationale for granting mcl and NGL priority reviews Wild <unk> received a standard review and then on the last call. I think you mentioned the tumor agnostic program requires inclusive would transition to a molecular defined approach and I was wondering if you.

Jay Olson: Thank you. The next question is coming from Jay Olson from Oppenheimer. Your line is now live.

Have any more details on those plans.

Steven H. Stein: Oh, hey, thanks for taking the questions and congrats on the three parseclusive filings and acceptances. Can you comment on FDA's rationale for granting MCL and MZL priority reviews while FL received a standard review? And then on the last call, I think you mentioned the tumor agnostic program for parseclusive would transition to a molecularly defined approach. And I was wondering if you had any more details on those plans. And then lastly, on Bon Jovi, can you talk about any impact that you're seeing from Poly-V, especially as it moves to the frontline setting and any feedback from physicians in terms of how they compare those two drugs? Jay, it's Steven.

Then lastly on one Judy can you talk about any impact that you're seeing from Paul Evs, especially as it moves to the front line setting in any feedbacks.

<unk> in terms of how they compare those two drugs.

Jay It's Steven Thanks for your questions on the path to close the acceptance of filing.

<unk> is one of the biggest submissions I've I've ever been involved in in a positive way because we submitted all three indications at the same time with the entire package and are realizing that the diseases, although under the umbrella of non Hodgkin's lymphoma in general are different in terms of some of the pathophysiology.

And the way they behave and that's exactly what happened in terms of the review cycles, you alluded to so for both marginal zone and mantle zone lymphoma, given the unmet medical need there the FDA felt that they weren't a priority review and also given the data we've seen for Follicular I think.

Steven H. Stein: Thanks for your questions. On the past ECCLSR acceptance of filing, so, you know, it's one of the biggest submissions I've ever been involved in in a positive way, because we submitted all three indications at the same time with the entire package, you know, realizing that the diseases, although under the umbrella of non-Hodgkin's lymphoma in general, are different in terms of some of their pathophysiology And that's exactly what happened in terms of the review cycles you allude to.

Their feeling is maybe it's a little more of a crowded space less unmet medical need, but also and I think very importantly, it's a condition that they want long long term follow up in terms of the responders and I think that's what's driving the review cycle. They have been lengthened obviously, our intent is to try and March these through all at the same time.

Steven H. Stein: So for both marginal zone and mantle zone lymphoma, given the unmet medical need there, the FDA felt that they warranted a priority review, and also given the data we've seen. For follicular, I think, you know, their feeling is maybe it's a little more of a crowded space, less unmet medical need, but also, and I think very importantly, it's a condition that they want And I think that's what's driving the review cycle there being lengthened.

And get them approved at the same time, but if they end up separating out follicular to get longer follow up on the responders.

That's what's driving the standard review cycle there.

In terms of your second question I think you were alluding to <unk> tumor agnostic program, our <unk> inhibitor and we had a.

A tumor agnostic study underway for patients either with FGF are too.

<unk> driven.

<unk> or <unk>, III or any others and what we saw within that program. Although early in small numbers is some.

Carriage and signals in certain areas like glioblastoma that felt to be more FGF are three driven and like some areas of non small cell lung cancer that were more if GFR two driven and we felt that the likelihood of getting a a wide tumor agnostic indication was.

Steven H. Stein: Obviously, our intent is to try and march these through all at the same time and get them approved at the same time, but if they end up separating out follicular to get longer follow-up on the responders, you know, I think that's what's driving the standard review cycle there. In terms of your second question, I think you were alluding to Pemi Gatnab's tumor agnostic program, our FGFR inhibitor, and we had, you know, a tumor agnostic study underway for patients either with FGFR-2, Driven Arrangements, or FGFR-3 or any others.

Perhaps more limited and it was more efficient too.

Stopped agnostic program enrolling across the board and go at those.

Exactly at those two histology directly so there'll be in our phase two studies underway in both Glioblastoma multi format that safety of our three driven and non small cell lung cancer that Jeff GFR, two driven and then for your <unk> Pahlavi question I'll turn it to Barry.

Sure Jay So in terms of my Juvie and how it relates to <unk>.

We think well first of all were approved in the second line setting for <unk>.

Steven H. Stein: And what we saw within that program, although early and in small numbers, were some encouraging signals in certain areas, like glioblastoma that felt to be more FGFR-3 driven and like some areas of non-small cell lung cancer that were more FGFR-2 driven. And we felt that the likelihood of getting a wide tumor agnostic indication was perhaps more limited, and it was more efficient to stop the agnostic program enrolling across the board and go directly at those two histologies directly. So there'll be phase two studies underway in both glioblastoma multiforme that's FGFR-3 driven and then non-small cell lung cancer that's FGFR-2 driven. And then for your Monjuvi-Pallavi question, I'll turn it to Barry. Sure, Jay.

To fuse.

The help bcl patients.

We.

Really think that.

Our profile is always going to be attractive to patients and to physicians.

Perhaps as you know <unk> reported over the last two quarters that their sales have declined and we actually believe that because we're continuing to make inroads there but please.

Proved in the third line setting we're improving the second line setting as far as moving to the first line for Levi if they do move to the first line, we haven't seen the data yet.

But that wouldn't bother us it actually gives us more faith that our frontline trial.

Barry P. Flannelly: Sure, Jay. So, in terms of MAJUVI and how it relates to Pulevi, you know, we think, well, first of all, we're approved in the second-line setting for diffuse large, diffuse, D-HEL, B-C-HEL patients, and we really think that our profile is always going to be attractive to patients and to physicians.

We will be positive.

For these patients.

And that.

Even if they are in the first line setting before we get there we'd be the choice for the in the second line setting.

Going forward, but we really believe that if their study is positive in combination with R chop or study could be.

Barry P. Flannelly: Great, thanks for taking the question.

Positive in combination with R chop.

Marc Frahm: Thank you. Our next question today is coming from Marc Frahm from Cowan & Company. Your line is now...

Great. Thanks for taking the questions.

Thank you. Our next question today is coming from Marc Frahm from Cowen <unk> Company. Your line is now live.

Steven H. Stein: Thanks for taking my questions. Let me just start with one follow-up for Steven. On your comments about when you were discussing that you've seen pathway engagement in the hepcidin pathway, were you speaking just about iron release, or have you seen rises in red blood cell counts in that monotherapy trial? And then, for Barry, maybe you can give a little more granularity on what you mean by broad access. I guess, first, have any meaningful contracts been signed yet, or at least getting very close to finalization, where maybe you can speak to what type of step edits you're expecting to be in those final agreements?

Hi, Thanks for taking my questions.

Maybe to start with one follow up for Steven on your comments out too.

We are discussing that use <unk> pathway engagement pathway.

Speaking just about iron release or have you seen rises in red blood cell count in the in that monotherapy trial.

And then for Barry maybe if you can give a little more granularity on what you mean by broad access I guess, one have any meaningful contract has been signed yet or are we getting very close to finalization, where maybe you can speak to what type of step edits youre expecting to be in those final.

Steven H. Stein: Marc and Steven, thanks for the question. We have not presented publicly data yet on hemoglobin improvement, if that's what you were asking directly, but we have demonstrated pre-clinically and then in clinical samples that it's doing exactly what we wanted to do from an MOA point of view in terms of ion dynamics and ferritin. We don't have the clinical end point yet on the actual rise in hemoglobin, and we hope that will, and then Barry can answer this. Sure, as far as negotiations with payers are concerned, like I said, they're ongoing. We think they're very positive.

In this final agreements.

Okay.

Marc it's Steven Thanks for the questions.

We have not presented publicly data yet on on hemoglobin improvement is that what you were asking directly but we have demonstrated pre clinically and then in clinical samples that it's doing exactly what we wanted to do from an M&A point of view in terms of iron dynamics and ferritin we.

We don't have the clinical endpoint to an actual rise in hemoglobin and hope the.

That will follow and we will be able to present that next year to you.

And then Barry can answer the second part.

Barry P. Flannelly: Sure, as far as negotiations with payers are concerned, like I said, they're ongoing, and we think they're very positive.

Sure as far as our negotiations with payers like I said they are ongoing we think theyre very positive we think in the first quarter will actually have broader access and.

Barry P. Flannelly: We think in the first quarter we'll actually have broader access, and so we're negotiating not just with the large PBMs but all of the regional payers that are important throughout the country, and so I'm very confident that we will, in fact, in the near term, sign contracts. But don't forget, patients do have access to the drug now, not just through our patient support program, but they're being paid for. You asked about step edits.

So we're negotiating not just with the large pbms, but all of the regional payers that are important throughout the country and so I'm very confident that we will in fact in the near term signed contracts, but don't forget patients do have access to the drug now not just through our patient support program, but they are being paid for you asked about step out.

Yes.

We think that this drug is going to be used after steroids and I think that's perfectly appropriate we think in fact, we.

Barry P. Flannelly: We think that this drug's going to be used after steroids, and I think that's perfectly appropriate. We think, in fact, we have a very good situation where, from steroids all the way up to systemics, all of those patients, with mild to moderate disease, this will be the drug to use for them. And we know that thousands and thousands of patients have already failed steroids, so the patient population is just there for us to begin to use a drug with the profile that Opsalora has.

We have a very good situation, where from steroids all the way up to Systemix all of those patients for mild to moderate disease. This will be the drug to use for them and we know that thousands and thousands of patients have already failed steroids. So that patient population is just there for us too.

For them to begin to utilize the drug with the profile that <unk> has so we're conscious that we're confident about.

Barry P. Flannelly: So we're confident about our future market access, and we're confident that patients are getting drugged now, and we don't think that step edits will be a problem, or if there is one step edit, just like on our label, that should be used after prior topical therapy, that's exactly where it's going to be used, and we're fine with that. Thank you. Our next question... Andrew Berens from SGB

Our future market access and we're confident that patients are getting drug now and we don't think that step edits will be a problem or if there is one step at it just like in our label that should be used after prior topical therapies, that's exactly where it's going to be used and we're fine with that.

Okay.

Thank you. Our next question is coming from Andrew Berens from SBB Leerink. Your line is now live.

Andrew Berens: Thank you. Our next question is coming from Andrew Berens from SVB. The line is now live.

Hi, Thanks for taking the question.

Maybe just a little color on the sample program.

What size of the tubes that are being given.

Are there any mechanics that a physician has to go through before trigger sample just trying to get a sense for how confident you are at the samples are going to be converted to paid patients.

unknown: Well, I'm not sure if I exactly understand your question, but, you know, the sample size is, in fact, 5 grams, so it's a very small tube. Healthcare professionals don't really have to go through anything in order to utilize samples. [inaudible] Right, well I'm just trying to make it so they don't have to have a longer-term prescription to get the free sample initially. No, they don't have to. No, they can just write the prescriptions, and many just write the prescriptions up front right away.

Well I'm not sure if I exactly understand your question, but.

The sample size or in fact five grams.

Small tube.

Health care professionals don't really have to go through anything.

In order to.

So utilized samples.

And Oh.

Okay.

Right, well just to add to it.

So they don't have to have.

Longer term prescription to get <unk>.

For example, initially.

No. They don't have to know that they can just write the prescriptions and many interest rate to prescriptions upfront.

Up front right away.

So while we did decided to do.

unknown: So, what we did decide to do..., in fact, was to temporarily suspend our sample program, because we had a report for the samples of a texture problem. So we just temporarily decided to stop the samples right now and that we will, in fact, investigate the root cause of any texture problem. Of course, we have to get the tube sent back to us. We have to verify lot numbers and that sort of thing. But we just thought it was the best thing to do at this point to temporarily suspend the program. Once we figure out what that report really means, then we'll see if we can restart the sample program again.

In fact was to temporarily suspend our.

Our sample program.

We had a report for the samples of a texture problem.

So we just temporarily decided to stop the samples right now and that we will in fact investigating the root cause of any texture problem of course, we have to get the.

<unk> to be sent back to us we have to verify a lot numbers and that sort of thing, but we just thought it was the best thing to do at this point to temporarily suspend once we figure out.

What that report really means then we will see if we can restart the sample program again.

Thank you. Our next question today is coming from Michael Schmidt from Guggenheim. Your line is now live.

Michael Schmidt: Thank you. Our next question today is coming from Michael Schmidt from Guggenheim. Your line is now live.

unknown: Hey guys, thanks for taking my questions. I just had a clarification on Apsalura and then one on Temazur. On Apsalura, off the 3,000 tubes ship that you mentioned, is there any expected inventory in Star?

Hey, guys. Thanks for taking my questions I, just had a clarification on ops and Nora and then one on <unk> here on ops and Laura after 3000 tubes ship that you mentioned is there any expected inventory and starting a built up or is that expected to directly translate into prescriptions.

unknown: Is this talking or built up, or is that expected to directly translate?

unknown: Unknown Executive, Vikram Purohit, Srdan Verstovsek, Ross Levine, Conor MacKay, David

And then.

On <unk> I.

I guess, just thinking about market dynamics here in cholangiocarcinoma, given the sort of flattish sequential sales and how much additional growth opportunity you see in CCA.

unknown: Thank you all for the opportunity you see in CCA.

unknown: Now, help us understand the opportunity in non-small cell lung cancer and upcoming data disclosure.

And and again help us understand the opportunity in non small cell lung cancer and upcoming data disclosures for the <unk> program. Thanks, So much.

unknown: Data Disclosures for the Pemizer Program. Thanks so much.

Barry P. Flannelly: Sure, Michael. So for the first one, 3,000 tube ships, no, I don't think there's really much inventory. I think all of those tubes shipped to pharmacies will be turned into prescriptions. The reason is simply that a drug like this they don't keep on their shelves for a long period of time. They're going to make sure that, in fact, patients have insurance coverage or they have access to the drug before they're going to order it from the wholesalers. So I don't think there's very much inventory there at all.

Sure Michael So for the first one 3002 ships no I don't think there's really much inventory I think all of those to ship to pharmacies.

We will be turned into prescriptions. The reason is simply that a drug like this they don't keep on their shelf for a long period of time.

They're going to make sure that in fact patients have insurance coverage or they have access to the drug before theyre going to order. This from the wholesalers. So I don't think theres very much inventory there at all obviously there is inventory at each of the wholesalers sites that will eventually go out to pharmacies. In fact, most of these pharmacies are.

Barry P. Flannelly: Obviously, there is inventory at each of the wholesaler sites that will eventually go out to pharmacies. In fact, most of these pharmacies are independent pharmacies. So pharmacies that are very used to working with dermatologists, that's most of their practice. So that's actually very encouraging because dermatologists like to work with their local pharmacies that are experienced in working with dermatologists. As far as Pemegatinib goes, Pemezir goes, and the cholangiocarcinoma market in the United States, sure, there's growth opportunities there.

Independent pharmacies pharmacies that are very used to working with dermatologists as there is.

That's their most of their practice, so that's actually very encouraging because the dermatologist liked to work with their with their local pharmacy, that's experienced in and working with dermatologist.

As far as the timing of getting them go as payments here. It goes in the Cholangiocarcinoma market in United States sure Theres growth opportunities. There. Obviously, we have a first line study and moving into the first line setting with it would actually mean a whole lot to us.

Barry P. Flannelly: Obviously, we have a first-line study. Moving into the first-line study would actually mean a whole lot to us. We know that there are patients being tested for FGFR2 alterations and rearrangements, but there could be more patients tested. So the more patients that are tested and identify that they might have these FGFR2 alterations, then they would be candidates for Pemezir. So I think there is growth there, but it is, as you know, a very small patient population.

That.

We know that.

Patients are being tested for.

For <unk> two.

Alterations and rearrangements, but there could be more patient stuff. So that more patients that are tested identify that they might have this FTF, our two operations than they would be candidates.

Four.

<unk>. So I think there is growth there, but it is as you know a very small patient population and as far as the lung cancer patient population to go you know, we'll have to see but we'll have to see how many patients actually do have.

Barry P. Flannelly: And as far as the lung cancer patient population goes, you know, we'll have to see. We'll have to see how many patients actually do have an FGFR alteration in lung cancer, and we'll see what the future opportunity is there as we continue to roll out our studies. Thank you. We have time for one more question. Good morning everyone, this is Rob Andrew. I'm on behalf of Matt Phipps.

In ft fr alterations in lung cancer and.

We'll see what the future opportunity there as we continue to rollout our studies.

Thank you Tom.

For one more question that comes from the line of Matt Phipps from William Blair. Your line is now live.

Good morning, everyone. This is Rob Andrew answer.

I just wanted to follow up on the earlier question that.

Matt Phipps: Thank you. We have time for one more question that comes from the line of Matt Phipps from William Blair. Your line is now live.

On the on the sample products and the potential issues.

Some prototypes really different from the prescription product if at all.

unknown: So yes, they're produced differently. Obviously, it's a 5-gram tube, you know; it takes different pressure to get into the 5-gram tube.

Juice separately and that likely to be any issues with commercial products.

Thanks.

So yes. They are produced differently, obviously, its a five gram tube it takes different pressure to get into the five gram tube.

unknown: So there are separate batches, and, you know, we produced about 140,000 of the samples. As far as the 60-gram, we're investigating all of the batches just to make sure that the texture and problems, if there is any, we can fix and address. We actually do have, and we're following up on information that was reported to us that we may actually have a texture problem with the 60-gram tube, but we're working through that right now.

So they are separate batches and.

We produced about 140000.

Of the samples.

As far as the 60 Gram, we're investigating all of the batches just to make sure that the texture and problem.

If there is any we can fix and address.

We actually do have.

We're following up on.

Information that was reported to us that we may actually have a.

Texture problem with the 60 gram tube, but where.

We're working through that right now, but we have to do a root cause analysis and we have thousands of tubes out there and we have to know get them back from the fed.

unknown: But we have to do a root cause analysis, and we have thousands of tubes out there, and we have to know, get them back from the patients or from the healthcare providers, have that analyzed, see what the storage conditions were, and once that analysis is done, then we'll go forward from there.

The patients or from the health care providers have that analyzed see how what the storing conditions, where and once that analysis is done then we will.

Go forward from there.

Operator: Thank you. We've reached the end of our question and answer session, and ladies and gentlemen, that does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.

Thank you we've reached end of our question and answer session and ladies and gentlemen that does conclude today's teleconference and webcast. You may disconnect. Your lines at this time and have a wonderful day, we thank you for your participation today.