Q2 2022 Urogen Pharma Ltd Earnings Call

August 11, 2022

The.

[music].

Okay.

Good morning, ladies and gentlemen, and thank you for standing by and welcome to the Euro Gen Pharma second quarter 2022.

Conference call.

My pleasure to turn the call over to.

Vincent parole.

Your director of Investor Relations for Ya.

Please go ahead.

Thank you operator, good morning, everyone and welcome to European Pharma second quarter, 2022 financial results and business update conference call.

Earlier today, we issued a press release, providing an overview of our recent corporate highlights and financial results for the quarter ended June 32022.

The press release can be accessed on the investors portion of our website at investors Dot Euro Gen Dot com.

Joining me today are Liz Barrett, President and CEO , Dr. Mark Schoenberg, Chief Medical Officer, Jeff BOVA, Chief Commercial officer, and Don <unk>, Chief Financial Officer.

During today's call, we will be making certain forward looking statements. These may include statements regarding our ongoing commercialization activities relating to our ongoing and planned research efforts in clinical trials, the potential benefits of <unk> and our product candidate data presentation regulatory filings future revenue.

<unk> potentially reaching cash flow breakeven by 2025, the availability of the second tranche of our term loan facility and 2022 financial guidance among other things.

These forward looking statements are based on current information assumptions and expectations that are subject to change a description of potential risks can be found in our earnings press release and latest SEC disclosure documents, including under the risk factors heading up our quarterly report on Form 10-Q for the quarter ended June 32020 to file today.

You are cautioned not to place undue reliance on these forward looking statements and European disclaims any obligation to update these statements.

I'll now turn the call over to Liz Liz.

Thank you Vincent and thank you to everyone joining us today.

Summarizing this mornings press release, our progress during the second quarter of 2022 can primarily be viewed along three lines first is the continued growth of <unk> revenue.

As they own pace of enrolment of our clinical programs and the 30th further strengthening of the body of evidence underscoring the benefit of <unk> in a real world setting.

The common thread between each of these areas as disciplined execution and determined commitment from our entire team to deliver benefit to patients and value to shareholders, which I am pleased to discuss in more detail with you today.

Our overarching goal remains to fundamentally transform the treatment paradigm for patients suffering from your old failure or specialty cancers referred.

Fighting a largely underserved patient population with a crucial need for novel therapies.

Our currently approved medicine <unk> is a prime example of filling a need with a kidney sparing option for patients suffering from low grade upper tract <unk> carcinoma, and I'm pleased to report that we continue to see increased adoption with net revenue of $16 6 million a year over year growth of 12.

88% and 22% growth over Q1.

Jeff will describe our commercial results in more detail, including our review of real World outcomes data recently presented at <unk>.

We remain confident in our original guidance and expect growth and acceleration of jumbo adoption throughout the remainder of 2022.

Beyond <unk>, our two ongoing clinical trials are actively underway and enrolling at expected rates.

Most importantly, our envision phase III pivotal study of <unk> 102.

<unk> medicine in development to treat patients with low grade intermediate risk non muscle invasive bladder cancer.

<unk> on track for full enrollment by year end.

Assuming positive data, we anticipate filing an NDA with the FDA in 2024 and with targeted priority review, which would may allow for approval by the end of 2024.

If approved <unk> will be the first non surgical primary therapeutic to treat these patients.

Post approval, we anticipate a streamline launch given we're able to leverage our established commercial framework with the common prescriber base and similar product features that you all might have.

Based on market research, we believe EOG in one or two addresses a large patient population of 80000 patients in the U S alone and foresee a potential combined revenue of over $1 billion for <unk>, two and <unk> by 2027.

Okay.

Concurrently our first in human study to evaluate the safety and Tolerability of <unk>. In 301 is ongoing and provides an opportunity to broaden our technology application with expansion into immuno oncology and inclusion of locally deliberate immunotherapies targeting high grade Urologic cancers.

Mark will provide a further update on our clinical portfolio shortly.

Based on our current revenue projections and financial model. We believe we have the tools to reach cash flow breakeven by 2025. This is based on our confidence in our ability to achieve our guided full year 2022 minor product revenues in the range of $70 million to $80 million as well as access to an additional $25 million from that.

Up to $100 million term loan facility with funds managed by Pharmacon advisors.

We recognize that the capital markets are challenging for many companies in need of capital right now.

However, we do not foresee a near term need to raise additional cash Don will share our updated operating expense projections, reflecting a slight decrease in our full year guidance from last year's last quarter's projection.

While there are additional studies in business development opportunities. We are considering we continue to weigh these opportunities against our goal of reaching profitability.

With that I'll turn the call over to Mark to discuss our recent clinical development updates Mark.

As Liz described.

As our phase III envision trial with <unk> in one or two in our phase one trial with <unk> in 301 are pressing forward full steam on time and on budget.

Envision is a single arm international Multicenter study evaluating the efficacy and safety of <unk> in one or two primary chemo ablative therapy in patients with recurrent low grade intermediate risk non muscle invasive bladder cancer.

There are no approved primary nonsurgical therapies for the approximately 80000 patients.

Free from this disease each year in the U S alone and it's worth restating that the current standard of care for low grade disease as endoscopic surgical resection, which is performed repeatedly in the majority of patients due to tumor recurrence.

We expect to enroll approximately 220 patients across 90 clinical sites, who will receive <unk>. Once weekly intramuscular installations, you had one or two.

The primary endpoint will evaluate the complete response rate at three months after first installation and the key secondary endpoint will evaluate durability over time in patients who achieve a complete response at three months assessment.

As previously stated we remain confident in the design of the vision trial.

The clinical potential of <unk> in one or two for several reasons.

First envision shares a similar design and you Werent previously completed phase <unk>, Optima, II study, which enrolled patients with new and recurrent low grade intermediate risk non muscle invasive bladder cancer, and where we observed a complete response rate of 65%.

In this subset of patients duration of response of 12 months from the start of therapy estimated by Kaplan Meier analysis to be 72, 5%.

I'd like to take a moment to draw everyone's attention to an additional piece of information that has recently come to light in the wake of our fees to be up in the two trials invest.

Investigators at the University of North Carolina recently published an article in the journal of Urology detailing the patient experience of participants in the Aegean one or two phase two b trial on which the envision study is modeled participants in this research program were evaluated by questionnaire and a subsequent by detailed interviews.

These several interesting points emerged.

First patients reported few side effects following treatment with UGI and one or two.

Second many interview participants preferred chemo ablative treatment to the standard of care with which all had prior experience and third most would recommend Eugene and one or two to other patients considering treatment for noninvasive bladder cancer.

While preliminary these results are encouraging and further support the contention for the non surgical office based approach to the management of recurring it might be C could be valuable to patients I will reiterate this guidance that we aim to complete enrollment of the envision trial by the end of 2022.

Assuming positive data and plan for an NDA submission in 2024, while envision remains our top priority for UGI and one or two we also continued to advance a single arm at home installation feasibility study for <unk> in one or two described previously which we also anticipate completing this year.

Meanwhile, our phase one trial with <unk> 301 initiated in April is actively enrolling and on track for first arm completion within 12 months Youll recall Eugene in 301 is our in license <unk> four antibody for intramuscular administration via our T gel in development for the <unk>.

Used in combination with other immune modulators, including <unk> hundred one our proprietary telos seven agonist and other potential chemotherapy and immuno therapies to treat high grade non muscle invasive bladder cancer.

This study will also seek to determine a suitable dose for a subsequent phase II trial.

Worth reiterating that this study will utilize a novel Master protocol design that we believe will provide a more efficiently streamline development program since it allows for evaluation of multiple combinations in parallel.

We ultimately view Eugene in 301 is a cornerstone checkpoint inhibitor for a variety of potential combination therapies targeting high grade non muscle invasive bladder cancer.

Raleigh and beyond just Eugene in 301.

See intramuscular administration Immunotherapies with our T gel technology as an opportunity to explore a variety of novel launch latorre drug combinations with potential to advance care across multiple clinical indications and urology and specialty cancers.

I'd like to turn the call over to Jeff to provide a commercial update Jeff.

Thank you Mark.

As noted Joe motto sales continue to grow at $16 6 million in Q2, representing a 22% increase from Q1 and a 28% increase from the same period last year.

Our previous net product revenue guidance for Joe might of $70 million to $80 million for the fiscal year remains unchanged.

Our launch ramp strengthens as the environment continues to normalize activated sites on August 1st were 893 compared to 857 on May one 2022.

While repeat accounts on August one were 144 compared to 114 on May one 2022.

Another important metric we track for <unk> adoption is Nephrostomy tube administration.

Based on the feedback from our field force of regional business directors, our nurses and our territory business managers. We believe in the <unk> administration has increased from approximately 20% to approximately 40% of installations over the past three months.

This positive encouraging trend confers multiple potential benefits, including offering physicians and patients multiple modes of administration.

More flexibility in scheduling and minimizing manipulation of the year at or during installation.

In addition, nephrostomy installation may be performed by trained nursing professionals under clean rather than sterile conditions and does not require fluoroscopy after nephrostogram to confirm placement at the first installation.

Additionally, a retrospective pooled analysis by four premier academic institutions of real World data of 26 patients who received <unk> across to me was presented at the recent American Urological Association meeting by Dr. Kyle Rose.

This analysis described how 13 of 26 patients examined exhibited a complete response, while another 12 patients had a partial response nine.

<unk> patients went on to receive at least one dose of maintenance therapy importantly, ureteral stenosis occurred in four or 15% of patients. There were no severe adverse events reported and no patients had impaired renal function.

While our existing and prospective business with Joe might owe continues to strengthen we also cannot ignore the opportunity in hand with <unk> 102.

The U S market opportunity and low grade intermediate risk non muscle invasive bladder cancer is estimated at $3 billion and this considers the aforementioned 75% or 60000 patients that encounter recurrence.

68% of those encountered more than two recurrences and 23% have more than five.

In addition, <unk> procedures have been found to be associated with increased mortality of 14% independent of surgical risk and preliminary market research shows that physicians identify 25% of these patients as in eligible or averse to surgery anyhow.

With the relevant ease of administration of <unk>, 102, and the potential to limit or avoid to RPT. It should come as no surprise that 96% of urologists surveyed indicated they would adopt <unk> into their treatment protocol within two years of approval.

With that I'm happy to pass the call over to Don to discuss our financials.

Thank you, Jeff and thank you everyone for joining today's call I'm pleased to be with you today to review our financial results for the second quarter ended June 32022.

<unk> recorded a net product sales of <unk> for the second quarter over 2022.

<unk> 16 points of $6 million.

This compares to $30 million in the second quarter over 2021 with.

We continue to anticipate the full year 2022, net product revenue from termite at between 70 and $80 million.

Cost of revenues for the second quarter of 2022 was approximately $1 $8 million.

Resulting in a gross margin of 89% compared to a gross margin of 89%.

The second quarter of 2021.

Research and development expenses for the second quarter ended June 32022, or 12 points of $6 million compared to point to $1 million for the same period in 2021.

R&D expenses included $7 million and $1.2 million in noncash share based compensation expense for the second quarter of 2022 and 2021, respectively.

The increase in R&D expenses related to the ongoing phase III envision starting <unk> Gen, one or two offset by lower expenses for the phase one study of <unk> 301, as compared to preclinical work in the prior year.

Selling general and administrative expenses for the second quarter ended June 32022, or 20 point to Ed Noonan.

Compared to $22 $3 million for the second quarter of 2021.

SG&A expense includes $2 $2 million and $5 million over noncash share based compensation expense for the second quarter over 2022 and 2021, respectively.

The reduction in SG&A expense majority the primarily from a decrease in compensation expense offset by expenses related to our participation in the 2022 American Urology Association annual meeting.

Second quarter ended June 32022 reported financing expense related to a prepaid forward obligation to RTW investment of $5 8 million compared to $3 1 million for the same period in 2021.

Interest expense related to the up to $100 million come loan facility with funds managed by pharma advisors was $2 2 million for the second quarter of 2022.

As the transaction closed in March of 'twenty to 'twenty. Two there was no such expense in the second quarter over 2021.

For the second quarter ended June 32022, we reported a net loss of 26 point to $7 million or $1 18 per share. This compares to a net loss of $26 $2 million or $1 17 per share in the second quarter of 2021.

Net loss for the second quarter of 2022 includes two points of $9 million in noncash share based compensation expense compared to six point.

In noncash share based compensation expense in the second quarter of 2021.

We closed the quarter with a $112 4 million in cash cash equivalence and marketable securities.

During the second quarter, we took additional steps to further strengthen our balance sheet in support of our commercial and clinical development activities at least mention.

<unk> aware of the challenging capital markets environment and take comfort in our routine diligent and responsible management of our operating <unk> to ensure our core SSR prioritize and these are more than met.

We believe the closing of the up to $100 million term loan facility with the funds means the Biopharma advisors in March as it positioned us well to weather this challenging capital market environment.

As a reminder, our second tranche of $25 million over $100 million permanent remains available to us if drawn upon before the end of the year subject to customary bring down conditions.

As previously mentioned, we continue to anticipate the full year of 2022 net product revenues from Jan Michael to be in the range of $70 million to $80 million, representing a 46% to 67% increase over 2021, we've lowered our anticipated full year 2022 operating expense.

Guidance to spend in the range of $130 million to $140 million, including noncash share based compensation expenses of $10 $60 million subject to market conditions, and we anticipate the full year 2022, non cash financing expenses related to the prepaid forward.

Obligation to ITW investment in the range of $22 million to $26 million.

Of which an estimated $9 $1 million to pinpoint to $4 million will be paid in cash.

So in closing with our fortified the financial footing, we remain focused on commercial growth and execution in the clinic when copper due to our adjusted full year Opex guidance and ongoing efforts to prudently manage our cash burn we anticipate ending the year with approximately $100 million.

In cash and based on our current revenue projections and finance our mothers, we believe that our current financial position and the tools available to us provides us sufficient runway to achieve cash flow breakeven by 2025.

Our balance sheet is strong our income statement is continuing to strengthen and our cash flow is well in hand.

With that I'd like to turn the call back to Lisa for closing remarks.

Thank you Don I simply like to close by expressing my pride in all that we've accomplished and continue to execute on some of the entire year. So we.

We are in close contact with stakeholders that utilize and received Yamato as well as those participating in our clinical trials.

Thrilled with the feedback we continuously receive for advancing with innovative and novel treatment.

The address would not be possible without them and want to send our sincere thanks for their participation.

Recognize a challenging environment and want to thank and reiterate our commitment to our shareholders to recognize the long term vision and strategy and remain bullish on our ability to build a meaningful long term sustainable growth business announced.

I'll now turn the call over to the operator for Q&A session operator.

Thank you.

To ask a question you will need to press star one on one on your telephone.

Once again Thats star one.

<unk> bylaws compile the Q&A roster.

Our first question comes from the line of Chris Howerton from Jefferies. Your line is open.

Excellent. Thank you so much for taking the questions and congratulations to the team on the great quarter.

So I guess two questions from me one is kind of I guess more of a complex question I hosted a call with the physician.

Recently from Boston at a larger institution and I would like you.

To be able to maybe comment on two potential drivers of growth for Joe Mundo that came out of that call.

One was the <unk>.

Time, it took larger institutions to really onboard the process sufficiently.

From my conversations it seemed like it took their institution.

At least 12 months to kind of get fully on board. So how might we expect the impact of those larger institutions with potentially multiple patients available for Joe Mundo in there.

Coming quarters, and then the second one which you've already addressed on the call, which was awesome, which was the Nebraska My administration I think on one hand, you can see the ease of administration, but in his hands was not the preferred methodologies. So I guess, how are you kind of seeing the receptivity.

To that route of administration.

Moving forward is it going to be spotty like that is an education that it's going to take time to continue that adoption.

The second question that I have would be just a clarification in terms of the expected timelines for the data readouts for one or two.

Should that be is it I think it's just a one year endpoint. So is that kind of the timeline, we should be thinking about thank you.

Hi, there Chris the sleds first of all actually I want to thank you for doing hosting that call. It was very informative for us and if anyone on the line didn't get to hear it I would recommend I am not sure. If you have a playback of it but I would definitely recommend listening to a it's great ill just turn it over to Jeff to answer that.

Two questions on the time and then approximately tube and then Mark can answer the timing question.

Hey, Chris I appreciate the interview as well I thought he actually did it in less than 12 months. They were one of the ones that we're able to do it in six months.

Range it depends on the account.

It depends on the speed at which the champion can get it on formulary.

It through pharmacy as well because it does have to be mixed with these accounts.

No.

Those are probably still good numbers.

And in your hospital accounts, where there is more bureaucracy and there is more of a formal process. It could take anywhere from four to 12 months.

As you saw with the number of accounts activated we still got.

Counts to activate.

As we get closer to peak and where we're going to.

To grow that.

I think I'm comfortable saying that.

Faster ones can move four to 12 months.

Four months, an unusually sometimes it can take longer than that.

Okay, Yes, and the process I think it's going to continue to grow as we as we generate more data.

Really.

I was pleasantly surprised with the data that we have out there, which is which is good but it's not a significant number of patients I think it's going to continue to go up as we get a greater number of patients and we're able to go out there with more data having said that to answer your question I do think it's going to ultimately be physician preference.

You have physicians that.

Would prefer to deliver it retro grade and they still may.

But we've also heard from a lot of physicians that preferred to deliver a retro great a year and a half ago.

Delivering it now through an approximately two.

Chris.

Ask.

Sorry, Mike I just wanted to ask maybe just a very quick clarification to Jeff is the.

Could you estimate the kind of number of physicians that have tried to use the know for SME tube.

At this point.

Okay.

Yes.

I think the range would be too great I can certainly look into that.

But no I can't even I can't even estimate because it really has just been this last quarter.

I don't have that level again, so yeah.

Yes, I think just sort of comment on that as Jeff said.

Not everyone will move to an approximate two Brian you have those physicians, who are very comfortable with the current approach.

And they'll continue to do that and but those that well and actually you have some patients frankly, because we've talked to patients as well, who also don't want to use their phosphate tips. So having as Jeff commented I think having both available and utilization nephrostomy tube getting more data on that has been very helpful in that.

I think that will continue to be but I don't think that youll ever be in a situation where all of them are mark I don't know if you feel differently, but you can comment on that before you move to the question on the clinical timing I think thats exactly correct and the great thing here is there are two modes of administration and physicians will in patients who will avail themselves of whatever they're most comfortable with it.

A lot of meaningful flexibility.

In the real World, which is terrific and it's exactly how we take care of patients. So it makes a lot of sense and as has been said patients and physicians will make their own decisions, but it does provide a nice option into the approximately tubes available.

With respect to timing.

On envision I'll, let me just remind you we're going to enroll that this year everybody needs. A 12 month follow up that's what we'll spend 23 doing is getting all of that 12 month follow up so the data will be in 'twenty four for our NDA for submission to the FDA How's.

However.

As you all recall, we also were accumulating data from the Atlas trial and those data will be available in 'twenty, three and we expect to share some of those data then.

Okay.

I really appreciate you taking the questions. Thank you and we do have a replay of that call.

Go ahead, great. Thanks, Chris.

Q1, more if our next question.

Our next question comes from the line of rooms.

Robert <unk> from H C. Wainwright your line is open.

Thanks, so much for taking my questions.

Just a couple I was wondering.

Whether you have.

Rio degree of visibility at this point regarding well.

We're steady state sort of utilization rate penetration would be for the mis nephrostomy tube based delivery of gel <unk>. My understanding is right now it's running at around 40%, but do you think ultimately it's going to wind up being the vast majority of.

The situations in which <unk> is administered and then secondly, I was wondering if you could comment on in the context of your full year revenue guidance, what you expect to be to be the principal accelerators of revenue growth in the second half of this year. Thank you.

Sure.

Thanks, Brian I think it depends on the larger.

Retrospective data that will come hopefully hopefully soon.

It depends on what that reads out it to answer your question I'll give you a big range I think it's going to be the majority, but it's probably going to be between 50, and 70% I believe will be nephrostomy tube, depending a lot around that data and I would have never expected it to be this high this early.

Around that data.

Would have never expected it to be this high this early.

With with really very little data and the fact that it's been good.

Going up every quarter it doubled from Q1 to Q2 I could see this being as high as 70% to 75% of the installations.

And as far as far as guidance I do think it's going to be the retrospective data.

The timing of that can held 25% of the installations.

And as far as guidance I do think it's going to be the retrospective data that the.

The timing of that that can help excel.

Our end of year Q3, Q4 growth, we continue to implement more and more patient marketing. So patient awareness. We believe this is a big driver that can help us towards the end of this year and into next year. So if patients are aware, they're asking they are discussing with their.

<unk> this can help as well so those would be the two things in mind, yes, I think the only thing I'll add to that as we continue to see an increase and our patient enrollment forms and.

Patient demand and I think when you when you look at that and projected out of course.

We've talked about before.

<unk> a volatile so you cant look.

Just that patient enrollment partners because we also are starting to see a more.

More stocking and more purchases more bulk purchases, particularly by the institutions and as was mentioned in the.

First question that Chris said, we also are seeing some new institutions come onboard and have just actually gotten approval for some time.

Some of the larger institutions around the around the country. So I think as you continue to see that you continue to see the new institutions coming on board you continue to see naproxen.

Approximately team usage and particularly in the community practices. So they don't have to worry about <unk>.

Fluoroscopy or anything else I think those are the things that will.

Well help us to see an inflection point as we get into the rest of Q3 and Q4.

Thank you very much.

Thanks Ram.

Thank you Omar for next question.

Our next question comes from the line of Boris <unk> from Cowen Your line is open.

My first question is if we look a little further on Joe might out.

Projections.

Based on your internal market estimate what percentage of the target market hotel minor already penetrated.

Yeah, we haven't provided that particularly but.

Between 10, and 20% and we still have obviously a long way to go there. So it really depends I think one of the biggest things that we continue to fade.

Finding the patients writers because.

They're not they're not linear right you don't get every every month there is different patients that get identified in different levels of patients. So it's hard to sort of say what your exact penetration is at any point in time, you have to look at it over over time, but you can think about.

What we've talked about before which is that.

Tire market is $700 million, if you think about the $70 million this year, what penetration would be obviously would be.

It's bigger than 10% because 10% might be for the full year. So as you start to get into the second half of the year youre getting getting closer to that sort of 15% to 20%.

Got it and of these patients that are.

<unk> general.

Do you have a sense of the breakdown between large medical facilities, which may take a long time to onboard versus more community settings.

Yes, Jeff you want to talk about that sure. So it's still it's still continues to be about 50 50.

Got a for physicians for community doctors, who don't want to do this we put in the last six months of robust referral program to get those patients to folks that do.

There are some smaller groups that don't want to.

Don't treat you tuc or they don't want to be part of the buy and bill financial burden and so we connect them with physicians colleagues in their area that are administering and we will continue to do that that will be.

Critical success factor because there are a lot of urologists that they're not just want to.

Treat these patients and we need to get those to urologists that we'll provide you all model with an option just 50 50 as to answer your question.

Great. Thank you very much for taking my questions.

Thanks for us.

Thank you one moment for our next question.

Our next question comes from the line of Matt Kaplan from Ladenburg. Your line is open.

Hi, Good morning, guys and congrats on the second quarter results.

Just wanted to dig in just a little bit more in that process.

<unk> application I guess, maybe a question for Mark.

If if the data and future data looks.

Comparable to retrograde perfusion.

What would be the reason why doctors, where patients would prefer and retrofitted.

Is there some economic advantage.

Our incentives to doctors to use the retrograde versus.

Approximately two.

Okay.

Do you want to I'll take the economics.

Thanks, Matt from a medical perspective.

It looks like the arguments and this is again based on very preliminary data. The argument that people are going to be able to make is that there may be less ureteral manipulation with nephrotomy and as everybody recalls at least in the Olympus trial narrowing of the joerger, albeit transient and most patients was a concern.

That seems to be less of an issue with Nephrostomy administration. However from a medical perspective, how you get this gel into the renal pelvis or the yogurt is really more a matter of physician preference and comfort and from a patient perspective. The one thing that argues actually in favor of Necroscopy administration as it can be done very rapidly.

In the office and the retrofitted administration is a little bit more cumbersome and it requires a little more instrumentation, but let me defer to Jeff on the economics.

The community Doctor when they have to go as you know Matt when its part B drug it's whoever it's whatever institution or doctor buys the drug that gets this thing gets reimbursed. So if the community Doctor goes to their surgery center. It's the actual surgery center that purchases the drug in the surgery Center is reimbursed if they go to the <unk>.

Hospital its the same hospital purchases a hospital's reimburse what the advantage here is they can deliver this in the clinic. So it's the actual office that will buy the drug similar to other drugs like <unk> that are given in the clinic. This is now sort of changed and economics.

From a doctor who has been go into the surgery Center Orben go into the hospital. They now have the ability to buy the product and then they get reimbursed there their group of three or four or their clinic.

Okay. That's helpful Great.

And then a question on 102 in the envision study.

What what's the rate limiting step to the filing of the.

NDA at this point and I guess, what I'm getting at is where are you on manufacturing and where is that process.

Yes, I mean, where we are on schedule for that is not a rate limiting factor there everything's great.

Manufacturing our CMC.

All of that but really the rate limiting factor is 12 months of follow up Bryan months of follow up a minimum of 12 months of follow up and we will continue to follow the patients even beyond that so really it's as I've said before unfortunately I can't make 12 months go faster than 12 months is and so assuming we're on track right now for our enrollment.

Happy to say through July and it looks like will be that way through August . So we're happy with where we are with enrollment so we expect as well.

<unk> said that will be done by the end of the year and then you have to take those patients to 12 months. So.

We're saying it would be the end of 'twenty. Three so then it becomes database lock and cleaning, which obviously as you know it takes it takes it takes.

It takes time, we have to make sure we don't want to do anything that would jeopardize the quality of the data. So it's all about the data and the timing on on the follow up but we will continuously be talking to the FDA as we get a little bit closer and closer to that and see what our possibilities are for different types of submission. So as soon as.

We have that obviously, we'll share it but that is the only rate limiting factor for us.

Okay, great. Thanks, Thanks for the detail guys.

Yes, thanks, Thanks, Matt.

Thank you one more in for our next question.

Our next question comes from the line of Leland <unk> from Oppenheimer.

Line is open.

Good morning, Thanks for taking my questions.

Just a couple from me also on the on.

On the nephrectomy too.

Grid installation.

Clearly it seems to be capitalizing interest amongst physicians despite the limited.

In our discussion with urologists, it seems like Theyre, finding the time saving.

Patients coming in for their repeat briefly.

Installations with the tube to be simply much better then.

Much longer time involved in terms of having the preparations.

And the other aspects related to the retrograde.

Which may potentially.

To make up for or outweigh any any economic.

The financial benefits to those same physicians I'm wondering Jeff if you can kind of comment around that dynamic.

Also with the doubling of the installation rates on the <unk> just wanted to drill into that a bit more is this coming from.

Docs, who are becoming more comfortable and therefore treating more of their own patients because it provides an expansion and broadening of urologists, perhaps to those in groups, who may have been either slower or more reluctant to adopt a model how should we think about kind of the landscape of urologist adoption across the different types of neurologist.

Their community versus accrual center and so forth.

With answer Greg becoming.

Viable options. Thank you.

Sure. Thanks.

The first question. The one the biggest piece of feedback I get is they don't have to schedule. Our time. They don't have to schedule surgery Center time. It just allows them a lot more free freedom from a treatment standpoint. It allows the patient to go to a comfortable environment.

And so there is a convenience on both ends.

But I think the biggest the one that I've heard the most is just the scheduling which can be challenging given the staffing issues that were seeing in hospitals and surgery centers.

That's probably.

A big driver the biggest driver of that what I've heard as far as the doubling I think it's probably a combination of a lot of things I think now you see physicians that.

Enjoyed the ease of this in their clinic.

Sorry to see and start to realize that this is an option that they may expand.

To greater parts of our indication, perhaps they were using it in some areas and now they are using it in the full indication because they're able to do this in a more convenient manner I would say, that's probably more of a dominant than versus like new physicians that.

We're as interested in <unk> and now they are theyre very interested from an approximate two but I think there are some that that have that have shown interest now that we have shown data from this level of administration, but it's really primarily around the ease of convenience, even though we did overcome all the challenges around.

The training the mixing the setting things up.

Sometimes it's not really what we can do it's the institution. It's the scheduling is when can I get into or it's the days I'm MLR. This provides a big a much greater convenience for everyone.

Great. Thanks very much.

Thanks Leland.

Thank you Omar.

For next question.

Okay.

Our next question comes from the line Paul Choi from Goldman Sachs. Your line is open.

Hi, good morning, everyone. Thanks for taking our questions. This is Charlie on for Paul just a quick one from us.

Curious about the operation expense guidance reduction for the year at this point I'm. Just wondering is there any particular business strategy or philosophy behind where those cost cuts were made and just anything that youre looking to prioritize or anything any color there would be great. Thank you.

Yes sure.

Really what it came down to just some of our expenses came in lower than we expected right. So some of the particularly around the clinical studies and some of that work so and I'll ask Don to comment further I think that some of the other stuff was like we had we'd like to do a study in the <unk>.

Willing and unable right its something that the FDA has not agreed that they would give us an approval on but it's something that we believe if we had a study that showed those patients unwilling or unable to go through surgery that that could broaden the patient population. So we decided as a company to delay that started that study and to next year.

One we don't want to do anything with this is for <unk> to until we have finished our current envision study. So we decided to postpone that and I think the other stuff is really just really around the margin, but Don do you want to comment about that.

The remainder of everything to cover and so yes. So that's it.

It's gone really well.

We wanted to keep our micro and willing to focus <unk>, one as well but anything.

Good to have we're trying to reconsider but basically this covered everything yes, let me just make one other comment I just wanted to say, we havent cut anything that would that would help with the adoption of John that is one area that we absolutely are making sure that anything any areas, particularly in Jeff mentioned early around patient activation.

We really believe that too.

<unk>.

To get a sense of urgency from physicians that patient activation as a key strategy for us going forward.

We're not doing we're not cutting back on any of our commercial spending, but we're just being very diligent on everything that we're doing.

Got it I appreciate the color. Thank you all so much thank.

Thank you.

Thank you and I'm not showing any further questions in the queue at this moment.

Okay, great well.

As I mentioned before we're very proud of the progress that we continue to make toward realizing our vision for for those patients suffering from your failure cancers. We appreciate your continued close today's conference call. Thank you for look forward to keeping you all informed as events come to fruition. So thanks to everyone. Operator, you may now disconnect.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect everyone have a great day.

The conference will begin shortly to raise Johan during Q&A you can dial one one.

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Yes.

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Okay.

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Okay.

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Good morning, ladies and gentlemen, and thank you for standing by.

So the European pharma second quarter 2022.

Conference call.

Turning to Vincent parole.

Senior director of Investor Relations for your.

Please go ahead.

Thank you operator, good morning, everyone and welcome to European Pharma second quarter, 2022 financial results and business update conference call.

Earlier today, we issued a press release, providing an overview of our recent corporate highlights and financial results for the quarter ended June 32022.

The press release can be accessed on the investors portion of our website at investors thought Euro Jan Dot com.

Joining me today are Liz Barrett, President and CEO , Dr. Mark Schoenberg, Chief Medical Officer, Jeff BOVA, Chief Commercial Officer, and Don Kim Chief Financial Officer.

During today's call, we will be making certain forward looking statements. These may include statements regarding our ongoing commercialization activities relating to gel Milo our ongoing and planned research efforts in clinical trials.

Potential benefits of <unk>, and our product candidate data presentation regulatory filings future revenue opportunities potentially reaching cash flow breakeven by 2025, the availability of the second tranche of our term loan facility and 2020 financial guidance among other things.

You are cautioned not to place undue reliance on these forward looking statements and European disclaims any obligation to update these statements.

I'll now turn the call over to Lynn Lewis.

Thank you Vincent and thank you to everyone. Joining us today are summarized in this morning's press release, our progress during the second quarter of 2022 can primarily be viewed along three lines first is the continued growth of <unk> revenue.

Second is they own pace enrollment of our clinical programs and the 30th further strengthening of the body of evidence underscoring the benefit of <unk> in a real world setting the.

The common thread between each of these areas of disciplined execution and determined commitment from our entire team to deliver benefit to patients and value to shareholders, which I am pleased to discuss it in more detail with you today.

Our overarching goal remains to fundamentally transform the treatment paradigm for patients suffering from your failure or specialty cancers referred.

Writing, a largely underserved patient population with a crucial need for novel therapies.

Our currently approved medicines Yamato is a prime example of filling a need with a kidney sparing option for patients suffering from low grade upper tract <unk> carcinoma, and I'm pleased to report that we continue to see increased adoption with net revenue of $16 6 million a year over year growth of <unk>.

8% and 22% growth over Q1, Jeff.

Jeff will describe our commercial results in more detail, including a review of real World outcomes data recently presented at <unk>.

We remain confident in our original guidance and expect growth and acceleration of jumbo adoption throughout the remainder of 2022.

Beyond <unk>, our two ongoing clinical trials are actively underway and enrolling at expected rates.

Most importantly, our envision phase III pivotal study of <unk> 102.

Rob a medicine in development to treat patients with low grade intermediate risk non muscle invasive bladder cancer.

<unk> on track for full enrollment by year end.

Assuming positive data, we anticipate filing an NDA with the FDA in 2024 and were targeted priority review, which would may allow for approval by the end of 2024.

If approved <unk> will be the first non surgical primary therapeutic to treat these patients.

Post approval, we anticipate a streamline launch given we are able to leverage our established commercial framework with the common prescriber base and similar product features that you all might have.

Based on market research, we believe <unk>, one or two addresses a large patient population of 80000 patients in the U S alone and foresee a potential combined revenue of over $1 billion for UGI minus two and dropped by 2027.

Okay.

Concurrently our first in human study to evaluate the safety and Tolerability of <unk>. In 301 is ongoing and provides an opportunity to broaden our technology application with expansion into immuno oncology and inclusion of locally delivered immunotherapies targeting high grade Urologic cancers.

Mark will provide a further update on our clinical portfolio shortly.

Based on our current revenue projections and financial models. We believe we have the tools to reach cash flow breakeven by 2025.

This is based on our confidence in our ability to achieve our guided full year 2022, you might've product revenues in the range of $70 million to $80 million as well as access to an additional $25 million from the up to $100 million term loan facility with funds managed by former Con advisors, we recognize that the capital markets are challenged.

For many companies in need of capital right. Now however, we do not foresee a near term need to raise additional cash Don will share our updated operating expense projections, reflecting a slight decrease in our full year guidance from last year's last quarter's projection.

There are additional studies in business development opportunities. We are considering we continue to weigh these opportunities against our goal of reaching profitability.

With that I'll turn the call over to Mark to discuss our recent clinical development update Mark.

Thank you Liz.

As Liz describe both of our phase III envision trial with <unk> in one or two in our phase one trial with <unk> in 301 are pressing forward full steam on time and on budget.

Envision isn't single arm International Multicenter study evaluating the efficacy and safety of <unk> in one or two primary chemo ablative therapy in patients with recurrent low grade intermediate risk non muscle invasive bladder cancer.

There are no approved primary nonsurgical therapies for the approximately 80000 patients suffering from this disease each year in the U S alone and it's worth restating that the current standard of care for low grade disease is endoscopic surgical resection, which is performed repeatedly and the majority of patients due to tumor recurrence.

We expect to enroll approximately 220 patients across 90 clinical sites, who will receive <unk>. Once weekly intraventricular installations, you had one or two.

Primary endpoint will evaluate the complete response rate at three months after first installation and the key secondary endpoint will evaluate durability over time in patients who achieved a complete response at three months SaaS.

As previously stated we remain confident in the design.

The envision trial.

The clinical potential of <unk> in one or two for several reasons first envisioning shares a similar design into our previously completed phase two be optima, II study, which enrolled patients with you and recurrent low grade intermediate risk non muscle invasive bladder cancer.

Where we observed a complete response rate of 65% and in the subset of patients duration of response of 12 months from the start of therapy estimated by Kaplan Meier analysis to be 72, 5%.

I'd like to take a moment to draw everyone's attention to an additional piece of information that has recently come to light in the wake of hard fees <unk> two trial.

These several interesting points emerge.

First patients reported few side effects following treatment with <unk> in one or two.

Second many interviewed participants' preferred chemo ablative treatment to the standard of care with which all had prior experience third most would recommend you'd hear in one or two to other patients considering treatment for non invasive bladder cancer.

While preliminary these results are encouraging and further support the contention that a non surgical office based approach to the management of recurring and there might be C could be valuable to patients I will reiterate this is guidance that we aim to complete enrollment of the envision trial by the end of 2022.

Assuming positive data and plan for an NDA submission in 2024, while envision remains our top priority for <unk> and one or two we also continued to advance a single arm at home installation feasibility study with <unk> in one or two described previously which we also anticipate completing this year.

Meanwhile, our phase one trial with <unk> 301 initiated in April is actively enrolling and on track for first arm completion within 12 months Youll recall Eugene in 301 is our in licensed anti <unk> four antibody for intramuscular administration via our T gel in development for the year.

Used in combination with other immune modulators, including <unk> hundred one our proprietary <unk> seven agonist and other potential chemotherapy and immuno therapies to treat high grade non muscle invasive bladder cancer.

This study will also seek to determine a suitable dose for a subsequent phase III trial.

We ultimately view Eugene in 301, as a cornerstone checkpoint inhibitor for a variety of potential combination therapies targeting high grade non muscle invasive bladder cancer.

Broadly and beyond just Eugene in 301.

See intramuscular administration of Immunotherapies with our key gel technology as an opportunity to explore a variety of novel immunological toy drug combinations with potential to advance care across multiple clinical indications in urology and specialty cancers.

I'd like to turn the call over to Jeff could provide a commercial update Jeff.

Thank you Marc as Luke noted gel module sales continue to grow at $16 6 million in Q2, representing a 22% increase from Q1 and a 28% increase from the same period last year.

Our previous net product revenue guidance for <unk> $70 million to $80 million for the fiscal year remains unchanged.

Our launch ramp strengthens as the environment continues to normalize activated sites on August 1st were 893 compared to 857 on May one 2022.

While repeat accounts on August one were 144 compared to 114 on May one 2022.

Another important metric we track for <unk> adoption is the processed meat tube administration.

Just on the feedback from our field force of regional business directors, our nurses and our territory business managers. We believe Nephrostomy administration has increased from approximately 20% to approximately 40% of installations over the past three months.

This positive encouraging trend confers multiple potential benefits, including offering physicians and patients multiple modes of administration.

More flexibility in scheduling and minimizing manipulation of the year at or during installation.

This analysis described how 13 of 26 patients examined exhibited a complete response, while another 12 patients had a partial response nine.

Nine patients went on to receive at least one dose of maintenance therapy importantly, ureteral stenosis occurred in four or 15% of patients. There were no severe adverse events reported and no patients had impaired renal function.

While our existing and prospective business with gel might owe continues to strengthen we also cannot ignore the opportunity in hand, with <unk> and 102.

68% of those encountered more than two recurrences and 23% have more than five.

With that I'm happy to pass the call over to Don to discuss our financials.

Thank you, Jeff and thank you for everyone for joining today's call I'm pleased to be with you today to review our financial results for the second quarter ended June 32022.

Euros and recorded net product sales of <unk> for the second quarter over 2020 two.

Estimates for 2016 points of $6 million.

This compares to $30 million in the second quarter over 2021.

We continue to anticipate the full year 2020, net product revenue from termite at between 70 and $80 million.

Cost of revenues for the second quarter of 2022 was approximately $1 $8 million.

Resulting in a gross margin of 89% compared to a gross margin of 89%.

The second quarter of 2021.

Research and development expenses for the second quarter ended June 32022, or 12 points of $6 million compared to $1 million for the same period in 2021.

R&D expenses included $7 million and 1.0 emission.

In noncash share based compensation expense for the second quarter of 2022 and 2021, respectively.

The increase in R&D expenses related to the ongoing phase III envision study <unk> Gen, one or two offset by lower expenses for the phase one study of <unk> 301, as compared to preclinical work in the prior year.

Selling general and administrative expenses for the second quarter ended June 32022, or $28 million compared to $22 $3 million for the second quarter of 2021.

S as SG&A expense.

Two point was $2 million and $5 million over noncash share based compensation expense for the second quarter over 2022 and 2021, respectively.

The reduction in SG&A expense majority to primarily from a decrease in compensation expense offset by expenses related co participation in the 'twenty to 'twenty Two American Urology Association annual meeting.

For the second quarter ended June 32022 reported financing expense related to a prepaid forward obligation to RTW and best month or $5 $8 million compared to three point to $1 million for same period in 2021.

Interest expense related to the up to $100 million term loan facility with funds managed by a former advisor was two points or $2 million for the second quarter of 2022.

As the transaction closed in March of 'twenty to 'twenty. Two there was no such expense in the second quarter over 2021.

For the second quarter of 2022 includes two points of $9 million in noncash share based compensation expense compared to six point of view.

In noncash share based compensation expense in the second quarter over 2020. One we closed the quarter with a 100 Cove point $4 million in cash cash equivalents and marketable securities.

During the second quarter, we took additional steps to further strengthen our balance sheet.

Of our commercial and clinical development activities at least mention we are acutely aware of the challenging capital markets environment and take comfort in our routine diligent and responsible management of our operating texstar to ensure our core SSR prototypes and these are more than met.

We believe the closing of the up to $100 million, Tom long possibility with the funds manage the Biopharma advisors in March as well.

Just on the us well to weather this challenging capital markets environment. As a reminder, our second tranche of $25 million over $100 million remains available to us if drawn before the end of the year subject to customary bring down conditions.

As previously mentioned, we continue to anticipate full year 2022, net product revenues from J, Michael to be in the range of $70 million to $80 million, representing a 46% to 67% increase over 2021, we've all learned our anticipated full year 2022 or put any.

Guide us to stand in the range of $130 million to $140 million, including noncash share based compensation expenses of $10 6 million.

Subject to market conditions, and we anticipate the full year 2022, non cash financing expenses related to the prepaid forward obligation to ITW to invest money in the range of $22 million to $26 million.

An estimated $9 1 million to 10 points of $4 million will be paid in cash.

So in closing with our fortified the financial equity remained focused on commercial alcohol and execution in the clinic when copper due to our adjusted full year Opex guidance and ongoing efforts to prudently manage our cash burn we anticipate ending the year with approximately $100 million.

And cash and based on our current revenue projections and finance our mothers, we believe that our current financial position and the tools available to us provides us sufficient runway to achieve cash flow breakeven by 2025.

Our balance sheet is strong our income statement is continuing to strengthen and our cash flow is well in hand.

With that I'd like to turn the call back to Lee for closing remarks.

Thank you Don I simply like to close by expressing my pride in all that we've accomplished and continue to execute on from the entire year Genco. We are in close contact with stakeholders that utilize and receive Yamato as well as those participating in our clinical trials and are thrilled with the feedback we continuously receive for advancement is innovate.

And novel treatment.

<unk> would not be possible without them I want to send our sincere thanks for their participation.

We recognize the challenging environment and want to thank and reiterate our commitment to our shareholders recognize the long term vision and strategy and remain bullish on our ability to build a meaningful long term sustainable growth business.

I'll now turn the call over to the operator for Q&A session operator.

Thank you.

To ask a question you will need to press star one on one on your telephone.

Once again Thats star one.

<unk> bylaws compile the Q&A roster.

Our first question comes from the line of Chris Howerton from Jefferies. Your line is open.

Excellent. Thank you so much for taking the questions and congratulations to the team on the great quarter.

So I guess two questions for me one is kind of I guess more of a complex question I hosted a call with the physician.

Our recently from Boston at a larger institution.

We'd like you.

To be able to maybe comment on two potential drivers of growth for Joe <unk> that came out of that call.

One was the <unk>.

It took larger institutions to really onboard the process sufficiently.

From my conversation it seemed like it took their institution.

At least 12 months to kind of get fully on board. So how might we expect the impact of those larger institutions with potentially multiple patients available for Joe Mundo in.

Coming quarters, and then the second one which you've already addressed on the call, which is also which with the Nebraska. My administration I think on one hand, you can see the ease of administration, but in his hands was not the preferred methodologies.

How are you kind of seeing the receptivity to that route of administration.

Moving forward is it going to be spotty like that is an education that it's going to take time to continue that adoption.

The second question that I have would be just a clarification in terms of the expected timelines for the data readouts for one or two.

Should that be is it I think it's just a one year endpoint. So is that kind of the timeline, we should be thinking about thank you.

Hi, there Chris the sleds first of all I actually wanted to thank you for doing hosting that call, but it was very informative for us and if anyone on the line didn't get to hear it I would recommend I am not sure. If you have a playback of it but I would definitely recommend listening to it was great I will just turn it over to Jeff to answer that.

Two questions on the time and then approximately two and then Mark can answer the timing question.

Hey, Chris Yeah, I appreciate the interview as well I thought he actually did it in less than 12 months. They were one of the ones that we're able to do it in six months.

A range it depends on the account.

It depends on the speed at which the champion can get it on formulary.

It through pharmacy as well because it does have to be mixed with these accounts.

So.

Probably those are probably feel good numbers.

In your hospital accounts, where there is more bureaucracy and there's more of a formal process. It could take anywhere from four to 12 months.

As you saw with the number of accounts activated we still got.

Accounts to activate.

As we get closer to peak in.

We're going to continue to grow that.

I think that comfortable saying.

Faster ones can move four to 12 months.

Four months, an unusually sometimes it can take longer than that.

Okay, Yes, and the process I think.

It's going to continue to grow as we as we generate more data.

Really.

You have positions that would prefer to deliver it retro great and they still may.

But we've also heard from a lot of physicians that prefer to deliver a retro great a year and a half ago.

And then delivering it now through Nephrostomy tube.

Okay.

Hi, Chris.

Maybe ask.

So I'm sorry, Mike I just wanted to ask maybe just a very quick clarification to Jeff is the.

Could you estimate the kind of number of physicians that have tried to use the know for estimated.

Route at this point.

Okay.

Yes.

I think the range would be too great I can certainly look into that.

But no I can't even I can't even estimate because it really has just been this last quarter. So I don't have that level. So yes.

Yes, I think just sort of comment on that as Jeff said.

Not everyone will move to an approximate two Brian you have those physicians, who are very comfortable with the current approach.

And they'll continue to do that and but those that well and actually you have some patients frankly, because we've talked to patients as well who also don't want to use nephrostomy tube. So having is definitely commented I think having both available and utilization nephrostomy tube getting more data on that has been very helpful.

I think that will continue to be but I don't think that youll ever be in a situation where all of them on the Mark I don't know if you.

Feel differently, but you can comment on that before you move to the question on the clinical timing I think thats exactly correct and the great thing here is there are two modes of administration and physicians and patients who will avail themselves of whatever they're most comfortable with so it provides a lot of meaningful flexibility in.

In the real World, which is terrific and it's exactly how we take care of patients. So it makes a lot of sense and as has been said patients that physicians will make their own decisions, but it does provide a nice option into the approximately tube is available.

With respect to timing.

On envision I'll, let me just remind you we're going to enroll that this year everybody needs 12 month follow up that's what we'll spend 23 doing is getting all of that 12 month follow up so the data will be in 'twenty four for our NDA submission.

Submission to the FDA.

As you all recall are we also were accumulating data from the Atlas trial and those data will be available in 'twenty, three and we expect to share some of those data then.

Yeah.

Okay.

I really appreciate you taking the questions. Thank you and we do have a replay of that call.

Great. Thanks, Chris.

Thank you one more in for our next question.

Our next question comes from the line of Rick <unk> Rob.

Robert <unk> from H C. Wainwright your line is open.

Thanks, so much for taking my questions.

Just a couple I was wondering.

Whether you have.

Rio degree of visibility at this point regarding.

We're steady state sort of utilization rate penetration would be for the mis nephrostomy tube based delivery of Jo Mira <unk>. My understanding is right now it's running at around 40%, but do you think ultimately it's going to wind up being the vast majority of.

Jeff.

So thanks, Ralph I think it depends on the larger.

Retrospective data that will come hopefully hopefully soon.

It depends on what that reads out it to answer your question I will give you a big range I think it's going to be the majority, but it's probably going to be between 50, and 70% I believe will be nephrostomy tube, depending a lot around that data and I would have never expected it to be this high this early.

Around that data.

Would have never expected it to be this high this early.

With really very little data and the fact that it's been good.

Going up every quarter it doubled from Q1 to Q2 I could see this being as high as 70% to 75% of the installations.

And as far as guidance I do think it's going to be the retrospective data.

The timing of that that can help 75% of the installations.

And.

As far as guidance I do think it's going to be the retrospective data.

The timing of that that can help excel.

End of year, Q3, Q4 growth, we continue to implement more and more patient marketing. So patient awareness. We believe this is a big driver. They can help us towards the end of this year and into next year. So patients are aware.

They are asking they are discussing with their physicians. This can help as well so those would be the two things I think the only thing I'll add to that as we continue to see an increase and our patient enrollment forms and.

Patient demand and I think when used even when you look at that and projected out of course.

We've talked about before.

<unk> a volatile so you cant look.

Just the patient enrollment partners because we also are starting to see more.

More stocking and more purchases more bulk purchases, particularly by the institutions and as was mentioned in the.

First question that Chris said, we also are seeing some new institutions come onboard and have just actually gotten approval for some some.

Some of the larger institutions around the around the country. So I think as you continue to see that you continue to see the new institutions coming on board you continue to see naproxen.

Approximately tube usage and particularly in the community practices. So they don't have to worry about <unk>.

Fluoroscopy or anything else I think those are the things that will.

We will help us to see an inflection point as we get into the rest of Q3 and Q4.

Thank you very much.

Thanks Ram.

Thank you Omar for next question.

Our next question comes from the line of Boris <unk> from Cowen Your line is open.

Great Mike.

First question is if we look a little further on Joe Midol.

Projections.

Based on your internal market estimate what percentage of the target market hotel might already penetrated.

Yes, we haven't provided that particularly but.

Between 10, and 20% and we still have obviously a long way to go there. So it really depends I think one of the biggest things that we continue to face.

Is finding the patients writers because.

They're not they're not linear right you don't get every every mark theres different patients that get identified in different levels of patients. So it's hard to sort of say what your exact penetration is at any point in time, you have to look at it over over time, but if we think about.

What we've talked about before which is the <unk>.

Tire market is 700 million, if you think about the $70 million this year, what penetration would be obviously would be.

It's bigger than 10% because 10% might be for the full year. So as you start to get into the second half of the year youre getting getting closer to that sort of 15% to 20%.

Got it and of these patients that are.

<unk> general.

Do you have a sense of the breakdown between large medical facilities, which may take a long time to onboard versus the more community settings.

Yes, Jeff you want to talk about that sure. So it's still it still continues to be about 50 50.

Got a for physician for community doctors, who don't want to do this we put in the last six months of robust referral program to get those patients to folks that do.

There are some smaller groups that don't want to.

Either don't treat you tuc or they don't want to be part of the buy and bill financial burden and so we connect them with physicians colleagues in their area that are administering and we will continue to do that that will be.

Critical success factor because there are a lot of urologists that they not just want to.

Treat these patients and we need to get those to urologists that we'll provide you all model with an option.

50 50.

Ask your question.

Great. Thank you very much for taking my questions.

Thanks Boris.

Thank you one moment for our next question.

Our next question will come from the line of Matt Kaplan from Ladenburg. Your line is open.

Hi, Good morning, guys and congrats on the second quarter results.

Just wanted to dig in just a little bit more and that Ross.

<unk> application I guess, maybe a question for Mark.

If the data future data looks.

Comparable to retrograde perfusion.

What would be the reason why doctors more patients would prefer the retrograde.

Is there some economic advantage.

Our incentive to doctors to use the rest for Greg versus.

A nephrostomy tube.

Okay.

You want to I'll take the economic.

Thanks, Matt from a medical perspective.

It looks like the arguments and this is again based on very preliminary data. The argument that people are going to be able to make is that there may be less ureteral manipulation with nephrostomy and as everybody recalls at least in the Olympus trial narrowing of the yard or albeit transient and most patients was a concern.

That seems to be less of an issue with Nephrotomy administration. However from a medical perspective, how you get this gel into the renal pelvis or the yogurt is really more a matter of physician preference and comfort and from a patient perspective. The one thing that argues actually in favor of Necroscopy administration as it can be done very rapidly.

In the office and the retrofit of administration is a little bit more cumbersome and it requires a little more instrumentation, but let me defer to Jeff on the economics.

The community Doctor when they have to go as you know Matt when its part B drug it's whoever it's whatever institution or doctor buys the drug that gets this thing gets reimbursed. So if the community. Dr goes to their surgery center. It's the actual surgery center that purchases the drug in the surgery Center is reimbursed if they go to the <unk>.

Hospital, it's the same in the hospital purchases a hospital reimburse what.

The advantage here is they can deliver this in the clinic. So it's the actual office that will buy the drug similar to other drugs like <unk> that are given in the clinic. This is now sort of changed and economics from a doctor who has been go into the surgery center or been going to the hospital. They now.

The ability to buy the product and then they get reimbursed there their group of three or four or their clinic.

Okay. That's that's helpful. Greg.

And then <unk>.

On 102 in the envision study.

What what's the rate limiting step to the filing of the.

NDA at this point and I guess, what I'm getting at is where are you on manufacturing and and where is that process.

Yes.

Sure.

We're on schedule for that is not the rate limiting factor. They are everything is great from manufacturing our CMC.

All of that but really the rate limiting factor is you have 12 months of follow up Brian Haney Ross a follow up of minimum 12 months of follow up and then we will continue to follow the patients even beyond that so really it's as I've said before unfortunately I can't make 12 months go faster than 12 months is and so assuming we're on track right now for our enrollment.

Happy to say through July and it looks like will be that way through August so we're happy.

Happy with where we are with enrollment and we expect.

As we said that will be done by the end of the year and then you have to take those patients to 12 months, though.

We're saying that would be the end of 'twenty. Three. So then it becomes database lock and cleaning, which obviously as you know it takes it takes us.

It takes time, we have to make sure we don't want to do anything that would jeopardize the quality of the data. So it's all about the data and the timing on the follow up but we will continuously be talking to the FDA as we get a little bit closer and closer to that and see what our possibilities are for.

Different types of submissions so as soon as we have that obviously, we'll share it but that is the only rate limiting factor for us.

Okay, great. Thanks, Thanks for the detail guys yes.

Yes, thanks, Thanks, Matt.

Thank you one more in for our next question.

Our next question comes from the line of Leland <unk> from Oppenheimer Your.

Your line is open.

Good morning, Thanks for taking my questions.

A couple from me also on the call.

On the nephrectomy too Andrew greater installation.

Clearly it seems to be catalyzing interest amongst physicians. Despite the limited data in Arctic discretion with urologists. It seems like Theyre, finding the time saving.

Patients coming in for their repeat weekly.

Installations with the tube to be simply much better then.

We've got a much longer time to evolve in terms of having the preparations.

And the other aspects related to the retrograde.

Which may potentially.

Makeup for or outweigh any any economic.

The financial benefits to those same physicians I'm wondering Jeff if you can kind of comment around that dynamic.

And also.

With the doubling.

The installation rates on the Entre Gregg just wanted to drill into that a bit more is this coming from.

Docs, who are becoming more comfortable and therefore treating more of their own patients is it driving an expansion and broadening of urologists perhaps.

Those in groups, who may have been either slower or more reluctant too.

So Michael how should we think about kind of the landscape.

Alan just adoption across the different types of urologists out their community versus Earl center and so forth.

The answer Greg your comments.

Awesome. Thank you.

Sure. Thanks Lynn.

The first question the one.

The biggest piece of feedback I get is they don't have to schedule all of our time. They don't have to schedule surgery Center time. It just allows them a lot more free freedom from a treatment standpoint. It allows the patient to go to a comfortable environment.

And so there is a convenience on both ends.

But I think the biggest the one that I've heard the most is just the scheduling which can be challenging given the staffing issues that were seeing in hospitals and surgery centers.

That's probably.

A big driver the biggest driver of that what I heard as far as the doubling I think it's probably a combination of a lot of things I think now you see physicians that.

Enjoyed the ease of this in their clinic and start to see and start to realize that this is an option. They may expand to greater parts of our indication, perhaps they were using it in some areas and now they are using it in the full indication because they are able to do this in a more convenient.

I would say, that's probably more of the dominant than versus like new physicians that do.

We're not as interested in <unk> and now they are they are very interested from minus <unk> two but I think there are some that that have that have shown interest now that we have shown data from this level of administration, but it's really primarily around the ease of convenience, even though we did overcome all the challenges around.

The training the mixing the setting things up.

Sometimes it's not really what we can do it's the institution. It's the scheduling is when can I get into or it's the days I'm MLR. This provides a big a much greater convenience for everyone.

Alright, thanks very much.

Thanks Leland.

Thank you Omar.

Our next question.

Okay.

Our next question comes from the line of Paul Choi from Goldman Sachs. Your line is open.

Hi, good morning, everyone. Thanks for taking our questions. This is Charlie on for Paul just a quick one from US I was curious about the operation expense guidance reduction for the year at this point I'm. Just wondering is there any particular business strategy your philosophy behind where those cost cuts were made and just anything that youre looking to prioritize or anything any color there would be.

Right. Thank you.

Yes sure.

Really what it came down to just some some of our expenses came in lower than we expected right. So some of the in particular around the clinical studies and some of that work, so and I'll ask Don to comment further I think that some of the other stuff was like we had wed like to do a study in the unwillingness.

And unable right its something that the FDA has not agreed that they would give us an approval on but it's something that we believe if we had a study that showed those patients unwilling or unable to go through surgery that that could broaden the patient population. So we decided as a company to delay that.

Part of that study and to next year, one we don't want to do anything with this is for <unk> to until we have finished our current envision study. So we decided to postpone that and I think the other stuff is really just really around the margin, but Don do you want to comment about that.

As I mentioned everything to cover and so yes.

And then I'll re doing very well, we want to keep our <unk> and <unk>.

But anything good to have we're trying to reconsider.

Excluding covered everything yes, let me just make one other comment I just wanted to say, we havent cut anything that would that would help with the adoption of John that is one area that we absolutely are making sure that anything any areas, particularly in Jeff mentioned early around patient activation, we really believe that too.

No.

To get a sense of urgency from physicians that patient activation as a key strategy for us going forward.

So we're not doing we're not cutting back on any of our commercial spending.

We're just being very diligent on everything that we're doing.

Got it I appreciate the color. Thank you all so much.

Yeah.

Thank you and I'm not showing any further questions in the queue at this moment.

Okay, great well.

As I mentioned before we're very proud of the progress that we continue to make toward realizing our vision for for those patients suffering from your failure cancers. We appreciate your continued close today's conference call. Thank you for look forward to keeping you all informed as the Ikea events come to fruition. So thanks, everyone and operator, you may now disconnect.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect everyone have a great day.

Q2 2022 Urogen Pharma Ltd Earnings Call

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