Q3 2022 Pharming Group NV Earnings Call

Thank you.

[music].

Hello, and welcome to farming nine month 2022 results call. My name is Laurie and I will be coordinating youku today.

If you would like to ask a question during the presentation you may do so by pressing star one when your telephone keypad.

I will now hand, you wait to hoist fall into free CEO to begin Simon. Please go ahead.

Thank you very much and good morning, ladies and gentlemen, or good afternoon.

Very pleased to have you here at the nine months of 'twenty two results call and with me here is my colleagues.

And Rockwell and our Chief Medical Officer, and welcome our Chief Financial Officer.

And before we do that of course.

I would like to ask you to look at that forward looking statements slides.

This presentation may contain forward looking statements that of course are based upon our current estimates and beliefs.

Expectations and as you know things circumstances could change to watch the future, Okay, and having said that I would like to switch to the next slide where you see there'll be it thanks sure treat gentlemen.

Thank you all.

For those of you will be made before you know our faces and I would.

Like to flip to that I'd like to flip to slide number five what I would like to remind you of our strategic objectives. As we have first have formulated a while ago and that are still standing here and that is we are here to build and continue to build a sustainable business.

By focusing on the <unk>, that's still is very much the case will be the.

The case for the foreseeable future.

And then of course, the next step is to focus on the market approval launch and commercialization of linear ownership in key markets. So if the U S U K and the European Union and as you know we have our own sales force capabilities in all of these three markets and Thats executive will be the core of the lending early Sip.

Business that will be built on top of the <unk> business.

And thirdly, the ongoing pipeline developments.

From our own internal.

<unk> and projects that we have of course.

Quiet.

Over the course of time and the management of these rare disease assets because that is actually what we are doing we are focusing ourselves on the rare diseases to bring patients solutions that are unserved and suffer from rare diseases and as you know there's quite a few of these rare diseases that still have no cures of which now.

<unk> just one of them so far.

So if you would like to please switch over to the slide number six.

Do you see to the.

Three main pillars of our business and indeed.

The importance for <unk> is here of course, because the positive cash flow from <unk> helps to fund all these wonderful things that we are aspiring to do to fund plenty early step to fund further pipeline development and management. So in other words those sales forces that are in the markets that we're working on <unk> will continue to.

To do that in the for the foreseeable future as our product has a place in the market and we'll continue to have that has a place in the market.

Just one on the rent side as the anticipated approval and commercialization of any ownership.

Rare diseases to recently.

Covered a rare disease.

<unk> disease awareness is still relatively low.

Litigation of course that stated that it was estimated to be one and a half patients for millions of population, which works out if you see that on that calculation.

According to the literature does should be 30 150 patients we have become very active now in starting to search systematically for these patients and are finding them.

On a regular basis and all sorts of places.

And then of course, you see they're below that in itself, we believe that.

And then your ownership compounds could become.

<unk> itself, because we have found some very interesting additional indications from <unk>.

Research alliances that Novartis has been doing with several very well known institutions and are currently sort of prioritizing, which one of these diseases to prioritize for subsequent development and of course bring them eventually to the markets.

And then the right hand side as I was already alluding to an ongoing pipeline development.

For the rare disease assets through internal projects and potential acquisition.

You referred to the late stage assets two in licensing and M&A opportunities. So that we can actually build a portfolio going forward.

And of course internally, we already have the in license OTR 105, the ex vivo hematopoietic stem cell gene therapy candidate for Heritor, angioedema, and last but not least from our own platform.

The covenant of our glucose today's enzyme replacement therapy for Pompe disease. So this is an overview of the way we see that we build a sustainable business.

And that's just reflect on that one more.

Second here.

This is a an important stage for the company I've said this before and I will continue to say that we are about to basically turn the company yet in the big other big transformation, namely.

One product dependency on Mei Mei, mainly one geography, <unk> for United States towards a balanced portfolio of two products in the market and of course, a significant business that we expect outside of the United States in the European Union, but also as you've heard us say before.

We are branching out with things Ron shops to Japan with with any obviously it. So we're really transforming the company going forward with the upcoming introduction of <unk> into the market.

Having said that let's just look at the <unk> achieved at the <unk> progress here on slide number seven and you have seen back in time that we have been very pleased that on September 28, we could actually announce the filing and acceptance for priority review of the new drug application to the.

The U S FDA and.

And that we have a <unk> goal date of 29 March 2023, and others, where we are gearing ourselves up to to bring the subsequent be as soon as possible to the U S market.

Very important.

Announced that we have already received a hedge well ahead of all time of the approval of the product and ICD 10 code. So that the patients can be classified diagnosed and of course can be reimbursable as well as the project comes to the market.

And it's not an easy thing to get an ICD 10 code, especially not for a rare disease. It means the rare disease is recognized and is recognized as severe and insignificant.

Badly in need for treatment.

One of the least we are of course on track for the commercial approval of linearity in the first quarter because of the <unk> date.

29 March and.

We are of course planning to bring the product as soon as possible in the second quarter to the U S to the U S market and we will keep you updated of course on progress regards steps.

Now, let's move to the next one the strategic highlights of Flonase OTC progress outside of the U S on slide number eight.

We were of course very pleased at.

At the beginning of the year to receive the Pip the pediatric investigation plan approval for and the European authorities.

Because the Europe .

The pediatric trials.

The same endpoints.

As our adult 12, plus trial on the basis of which.

Then your ownership is hopefully going to be approved so there was a very good news.

There was buy in from the European regulator for that as well and then we were very pleasantly surprised.

<unk> granted us an accelerated assessment.

File for that in your ownership because that is a very rare event at EMA.

Ground's accelerated assessment and therefore recognized is that the both the innovative character of the treatment is significant and the disease is very significant and needs urgent treatments.

And of course.

Recently in October you will have seen the announcement that we submitted the authorization application.

To the EMA and we are expecting no anytime soon a validation of the vial of the file by the Europeans.

And that's the.

The review continues.

And then on the right hand side.

The UK authorities have granted us the APRA.

April the promising innovation medicine designation again, a recognition that there is a serious disease that hadn't here and there is an innovative treatment that is making its way through the regular regulatory the regulatory pathway and we were very pleased that the UK government announced that they have extended.

The EC DRP is a recognition route for the European files until the end of 'twenty three and <unk>.

As soon as we have the positive opinion from the <unk>.

As expected of course.

We're in the second quarter, we will be able to hand over to file.

United Kingdom Authority Tdm HRA on.

In that respect we will expect together approval from them in early in the second half of late in the second half of 2023, because it takes about two months for them to review net.

That of course.

Is very helpful. Because it means that we will have a generalized label generalized packaging.

Throughout the European Union, and the United Kingdom, rather than a separate products separate labeling potentially in the United Kingdom, which now gives us a lot of additional complication and a lot of additional regulatory work. So we're very pleased with that decision by the UK government.

Now, let's move over to the next slide number nine.

On pre cleared our preclinical compounds OTR 105, we have made some good progress I should say our colleagues at Orchard have made some good progress because they already expert of course on developing that lengthy viral vector to enhance the C. One inhibitor expression and we're now starting to test is in preclinical disease models.

<unk>.

As it says here on the slide.

Anticipate to provide further updates as we get clear views on when we can actually expect to go forward through the IND.

Filing and of course.

<unk> clinical trials following an IND filing in.

And then on the right hand side hospital at least in our in our pipeline are of a glucose space.

Where we are looking for differentiating features pump is still a significant unmet medical need and we believe that our platform may have the potential to have to have differentiating features.

Versus the existing off of glucose today's enzyme replacement therapies and that is why we are continuing to search for that and if we find these we will start before the biggest compounds have going forward.

And that brings me of course at slide number 10 and overview of the pipeline.

That is now consisting of a product in the market of course, our product in regulatory review on both sides of the Atlantic late in your ownership with the accelerated.

Procedures ongoing.

<unk> gene therapy, 105, and offer glucose stays in pumping and of course, you see there.

It would be good for the balance for the portfolio in the pipeline. If there were some additional in license or acquire products that are in between that are in the clinical phase preferably in late stage of development to actually get our large get our launch call or even a little bit fuller towards the coming years.

And this brings me down on my last slide of the operational highlights.

On slide number 11, something we're very proud of that <unk> has again.

Realize significant sales will continue to do.

To generate significant sales recognizes as broad sales of $151 million.

These nine months and we are very pleased with the product that is already for such a period of time in the market.

It has found its place in the market and is surfing.

Increasing number of patients and is prescribed by an increasing number of physicians because of the fact that broker electric therapy patients.

Need a good medication for their breakthrough attacks and weakness as you know has a different mode of action than the prophylactic therapy. So it is a very rational choice. Two if you use <unk> <unk> submission a prophylaxis either oral or injectable that <unk> is a very rational choice as you hope.

Breakthrough medication and were very pleased that Morris physicians continue to see that more patients continue to see that and as <unk>. We will continue to play significant role in that market as a safe and effective acute treatment for territory angioedema and therefore, we guided at the beginning of the year that <unk> will continue to have single digit.

Growth of revenues in 2022, and you can see that we are delivering on that and we think that is a very great complement to our colleagues who work very hard every day to bring <unk> to additional patients in mainly in the U S market.

And with that said I'm happy to hand over to my colleague Dr to underwrite rather than our Chief Medical officer to take you through <unk> and led geology of highlights <unk> over to you. Please. Thank you Simon so we can jump to slide 13, and here you see that.

As a primary immune deficiency.

And you see on this slide with many periods clinical manifestation at the heart of it is in the abnormal development of the immune system and because of that abnormal development you have what's called non malignant proliferation services.

You see this manifest itself as well as lymph nodes and enlarged spleen and liver. We can also see this in the Gi tract.

Another key feature of Etfs because of this abnormal development of the immune system already recurrent infections and a whole variety of infections are seen in these patients.

And because of these recurrent infections and because of this abnormal development. These patients also development progressive lung disease.

Worsening of their Airways.

Recurrent.

Sections, but also a condition called bronchiectasis, which is irreversible loss of function.

On top of that these patients have because of this.

Proliferation.

The ability to transform into something.

Process such as lymphoma.

So this is a serious consequence of the condition.

I know it's observed unfortunately quite frequently in these patients and.

And lastly, these patients although they have an immune deficiency. They also have an immune dysregulation disorder. So they also exhibits some autoimmune phenomenon, where we can see this manifest itself in anemia, and other types of cytopenia as well.

But it can also be seen.

In the Gi tract as well as <unk>.

Liver disease.

On the next slide, but we help the results from the randomized double blind placebo controlled study with lineal said that this was a 12 week study.

Looking at two co primary endpoints.

The first co primary endpoint as presented on this slide number 14, where you can see that lineal also produced lymphadenopathy and it did it in a rapid manner in this 12 week study.

When compared to placebo and you can see that on the left panel on the primary outcome analysis, showing a statistically significant reduction versus placebo and the size of these so called index lesions and then you can see that on an individual basis also and you can see the placebo patients for example, either remaining staple largely or some some cases worsening, but you can see the <unk>.

He also treated patients.

You can see the size of the mill.

It's decreasing.

On the next slide we have the other co primary endpoint as I mentioned earlier that you see an abnormal development.

<unk> sells.

In <unk> patients and because of that abnormal development have all of those other clinical consequences, we've talked about.

One type of T cell that doesn't develop properties.

One manifestation of.

This abnormal development would be called naive b cells and so.

What we see is in <unk> patients that have a low proportion of naive b cells and when we treat them with <unk> you can see on the left with the primary analysis again statistically significant.

Increase in the proportion of naive b cells, where you can see on the right panel, where we included the full set of patients can see first of all it's quite rapid that you see even by the first month. There is a significant jump and this proportion of naive b cells and you'll see that that sustained over time for these patients versus the placebo patients who.

Do not respond.

This I think again it gets to the heart of the immune phenotype that is seen in these patients specifically.

T cells now are able to function and produce.

Antibodies.

Recognize antigens.

On the next slide we see the safety profile and this is again from the double blind placebo controlled study, where we see that when Youll was generally well tolerated with the severity.

The greater the aes across.

Placebo in millennials if patients were similar there were no deaths reported in this study and in the.

He's led to study discontinuation. During this randomized study and then lastly, there were no severe adverse events or serious adverse events that were related to study treatment.

Now moving on so these patients I mentioned were treated for 12 weeks in the double blind placebo controlled study, but then they went on into an open label extension study and here are some data that were recently presented at a conference.

In Europe , just a couple of weeks ago and this is showing patients who were in this randomized study and then went on to receive lineal soup and you can see data out to almost a year in these patients than you see on the on the <unk>.

Panel you can see that their lymph nodes actually continued to decrease in size. So you'll see that initial decrease.

They've had and then over time that continued further out.

On the right side, you can see some images.

Showing some representative samples of what this looks like again on the top you have patients who were treated with <unk>.

Double Blind study and then you can see there.

The decrease in time.

<unk> Mark and then further out at the 250 to Mark and then on the bottom panel you see a placebo patient and you see actually very nicely that there is almost no change in the size of this patients with node.

Between the screening time period, and the day 85 time period and then the patient receives money. Also then you can start to see that.

Decrease in size.

Similarly, we can see this on slide 18.

The size of the split as I mentioned earlier because of this abnormal.

<unk>.

These patients immune system. They also get liberal proliferation and that can also be manifest.

Massively enlarged spleens that these patients have so on the left panel you can see again these patients.

Large spleen that comes with a decreased in size during the first 12 weeks of the study, but then continued to decrease over the course of the extension study. The long term study and then if we look on the right side with the images you can see in the top panel of patient who was treated with lineal soup you can see that improvement.

Again rapid improvement in the first 12 weeks and then continued and sustained.

Decrease in the size of the spleen and then on the bottom panel you see a placebo patient splitting actually increase in size over the first 12 weeks, but then over the course of the following.

Nearly a year you'll see that.

Significantly decreased in size. So I think these are all consistent aspect.

That we're seeing with the treatment of millennials and then I think so.

Slide 19 also highlights another important aspect is that because of these abnormal <unk>.

Development of the immune system, and specifically b cells. They have what's called a class, which defect. So these patients do not transition to produce IGT type antibodies, but.

Their immune system gets stuck producing AGM antibodies and what you see here are three lines showing that patients who were at let's say.

Treated not treated with <unk> in the placebo study so those are in and.

And the Red line, so thats no previous plenty almost seven you said that you have high levels and those come down.

Over time.

<unk> continue to decrease and then patients who were treated with lineal feet.

They started at a lower level, but they also continue to decrease over time and then when we think all patients together you can see that same that same trend that these patients know their immune system is functioning properly because they are not stuck with just this one type of antibody and theyre able to class switch and produce.

Specifically with ITG and commodities.

On the last slide.

<unk> excuse me on slide 20, you can see some of the milestones for millennial ship. It all the time and highlighted that we have now seen acceptance of the FDA file with priority review.

We have completed the submission to the EMA also earlier this month and later this year, we hope to start recruitment for the pediatric studies.

And then.

Followed by some significant events also in 2023 with regulatory.

The approvals that are anticipated as well as commercial launches.

And with that I will turn it over to our CFO .

Great.

Thank you very much on Iraq.

First the financial highlights of the first nine months.

We had a increase in revenues of 3% from $146 million to $151 million.

In Q3, specifically, we had a turnover of $54 2 million, which means a growth of two 6% in the quarter versus previous year.

Our gross profit increased by 7% to one of the $39.7 million and that was driven by in the first place growth in revenues, but also by production efficiencies and favorable tailwind from currency translation effects.

You, probably all know that our shields is mainly in U S dollars.

Cost of goods are in Europe , so that has been being reflected here.

Our net profit increased by more than 100% compared to the same period last year and that was driven by an increase in other income and you may remember that that is largely due to the.

The reduction in the stake of.

By a connection our fill and finish partner.

Transaction that we did in Q2.

Profit on that transaction was.

$38 million.

Our cash and cash equivalents together with the restricted cash decreased from $193 million at the end of last year to 100.

$89 9 million at the end of the third quarter of 2022.

Driven by on the positive side, a strong operational cash flow offset by foreign exchange effect, because we've got a lot of cash in euros.

Still a strong.

Treasure chest also too.

To be able to fund future growth and most others by potential acquisitions.

Moving to slide 23.

The again the key the key numbers a growth of three 4% to $151 million in <unk>.

Revenue a growth of 7% and gross profit to one of the $39 7 million operating profit going up by 85% to $28 four.

And.

Here again, you see reflected the gain on the bio connection share sale in Q2, and a net profit of $28 3 million, which is an increase of more than 100%.

The quarterly development of the over the Cove.

Last two years.

In.

<unk>, we had sales of $96 8 million.

So far this year Q3 $151 million.

That means a sales of $54 2 million in Q3.

Compared to $52 9 million in Q3 last year. So I would say is steady growth in revenue, which.

Which is.

<unk> here.

Now moving to slide 25.

<unk>.

Explaining the profit before tax growth from $21 3 million in Q3 last year to $33 1 million.

Year to date Q3 this year.

Starting off with the growth in the business. So it just explains the gross profit increase.

The increase.

In costs, you see the different categories.

First one is R&D expenditure that was largely related to tinder and the other ship.

In preparation for the launch. This includes also a manufacturing manufacturing costs.

And then also additional costs in OTR 105, as Simon just described as well.

Increased G&A expenditure, that's let's say.

Collection of many costs think about costs think about recruitment costs.

We have recruited a lot of people.

Also to identify patients.

U S for <unk>.

And.

The latter category is marketing our sales expenditure that group grew by almost $13 million and again that is largely due to.

Out of pocket.

Cost for linear ownership almost $8 million and.

A big chunk of it is because of payroll so for increased marketing and sales staff.

The next two bars are pretty at pretty high first one that they almost wash out but the.

One is the.

Negative impacts on profit last year from the OTR 105 investment the collaboration with <unk> therapeutics in.

And this year.

The bio connection sale of the shares.

And that overall brings us to a profit before tax of 33 1 million.

Moving to slide 26, you see the development of cash from.

Beginning of the year till the end of Q3.

Starting off with $192 million at the beginning of the year.

<unk> had strong operational cash flow.

Operational cash flow before working capital was plus $26.7 million.

Cash because of an increase in working capital, especially in inventory was $4 $6 million and we paid taxes of $5 million and then you get to the net cash flow generators.

Operating activities fell 17 $2 million.

Cash flow from investing activities.

Lastly, our cash inflow because of the buy a connection transaction the cash part of that low surplus of $1 4 million and that was offset by capital expenditure and that was mainly in it.

Our cash flow from financing activities minus five three is regular lease cost and interest.

And the exchange rate effects.

Minus 29 is because mainly because we have zero cash in a euro reporting entity, but we are.

<unk> our results here.

U S dollars.

So overall that brings us to a cash and cash equivalents of at the end of Q.

Q3 of $198 7 million, so very pleased with this.

With this development, especially on the operational cash flow and <unk>.

Strong balance of cash flow.

To support future growth with that I would like to hand over back to the site.

Thank you and then it takes me to the slide number 27 the outlook the final slide of this presentation.

And we as we said before we continue to guide for the single digit growth.

The remainder of this year for Loopnet sales.

You already alluded.

Lucas about the commercial approval subject to the positive outcome of the FDA review that we anticipate.

<unk> debt on 29 March.

With the anticipated launch.

In the U S.

Sundar office oriented.

In the first half of 'twenty three.

Then of course subject to the positive review of the EMA the positive opinion from.

On the <unk>.

By the issuance of the MAA by the European Commission and as you know, there's some timing between their debt. So you can anticipate both of them in the <unk>.

First half 'twenty suite and that means that as soon as possible. After we will start rolling out the individual European markets in the second half of next year.

And then the very pleasant surprise as I was alluding to earlier of the extension of the ECP ERP finding plenty ownership by the MH array, which means that.

We can work.

But by submitting the CH the European file to the UK authority.

We expect a much quicker decisions maybe about two months after the.

<unk> positive opinion and can go to market in the UK faster than anticipated as well.

Of course, we continue and as you see them and you saw from the numbers that your room.

Outlining we continue to allocate significant resources towards the anticipated launch and commercialization of any ownership with a few that we are accelerating future growth as we start to build next year I expect to Bill Delaney ownership business on top of the <unk> business.

And last but not least we are continuing to hunt for new opportunities to fill the pipeline potential acquisition and licensing of new late stage late stage development opportunities in rare diseases.

And last not least all of the current activities can be funded this is very clear from our current balance sheet and only in the case of acquisitions. We think we may actually have to additional financing of course, depending on the size of the acquisitions.

I think that concludes the outlook and it concludes the presentation. So operator, we can now turn to for over to the <unk>.

Q&A.

Questions to <unk>.

Q&A section of this presentation. Thank you very much.

Thank you.

If you would like to ask a question. Please press star one on your telephone keypad.

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First of all I wanted to ask a question.

Our first question comes from all patch.

Hi, Ben Hoff Hatch. Please go ahead.

Great. Thank you for the update.

And the question.

No.

Couple of questions. One is different one is on who can ask one of them when you listed.

One just what we're hearing.

Understanding your own is that the increased use of prophylaxis therapies, especially the oils out there is leading to an increase use or at least.

Patients, having acute treatments on hand.

<unk>.

Do you expect that going forward, you expect that to be sort of a tailwind to your revenues for <unk> going forward.

And how long could that last and then when you look that we get a lot of.

Calls from investors, who are interested in each other immune conditions primary.

Immunodeficiency disorders could you go after and when could we start seeing some.

Some thoughts or something like that thank you for the question.

Okay, Let me try to answer that first one.

First.

Josh good morning by the way.

Hi.

Brokenness prophylaxis.

He was alluding already to this that we could see continuing positive trends in the number of physicians and patients using <unk> in the pass through connection was never used for a breakthrough attacks.

Also because the prophylactic therapy was mainly C. One inhibitor and it did not make much sense. Then in this case to use it and recognition was typically used for the very severely affected patients now are those fairly severely affected patients are still a lot of the core business of <unk> because they couldnt get.

Anywhere else.

Although there is also patients who then switch over to prophylaxis.

Reducing their use of <unk> because they continue to have breakthrough attacks and Thats exactly why why we are very pleased to see with the paradigm shift that has taken place over the past few years and towards Bradykinin <unk> submission.

Although prophylactic therapies are significantly improved there is still for a considerable and sometimes people tell me. It is more than half the patients that you would expect.

On a regular basis or incidental basis have breakthrough attacks and even even worse I was recently at a pace.

International patient conference and opinion leaders were warning there is patients that even if you don't have any breakthrough attacks for a considerable period of time.

Please always have rescue therapy at hand, because this is a nasty disease. It stretch driven and you can never know when a breakthrough attack.

Combined because out of the biggest danger is that people are sort of.

And getting comfortable with that prophylaxis and that they get an attack steel, which because of the unpredictable disease and have nowhere to go without any rescue therapy. So that emphasis is being brought out more and more also from the key opinion leaders to the patients and make them aware of that and that is actually the trend that we see that is of course.

Supporting and we will continue to support.

The <unk> business to us in the future and is of course win a very high and I using patients switched over to prophylaxis, we have to replace that patients with several patients that are of course all of that on breakthrough medication, but thats exactly what our people are doing and what our people continued to do and where we can see.

To make progress and see a lot of opportunity there because we still have a relatively modest market share as you know in this market. So in other words, sorry for the long winded answer we see.

For the foreseeable future <unk> will continue to play that role in the market and for the foreseeable future.

This will be this will be a necessity also when other additional.

Bradykinin Colloquy inhibitors may come to the market. There is always the danger for breakthrough attacks and weakness is there to be there with the unique mode of action that <unk> now has compared to all of its competitors and future competitors, because we see no C. One inhibitor.

Being in development anywhere.

In the <unk>.

And the pipelines with any of the other companies simply because C. One inhibitor is a notoriously difficult compounds to to to make and to develop.

Other than that you guys from blood donors and those products are in these not actively promoted anymore for active treatment.

Sorry for a long winded answer hydrogen I hope that answers your first question.

And then I'm sorry.

Good.

And maybe could you shine a light on on that question about new indications for millennial is appropriate because you are at the heart of it and I was recently.

Thanks, Simon and.

Good morning car types.

So we are looking at additional indications for lineal is that.

These are not actually in the area of other primary immune deficiencies, but we are looking at a number of indications.

And as Simon mentioned these include areas, where novartis that actually started some work and it has already some research collaborations ongoing so we're trying to leverage that but we're also looking at some new areas.

Don't think were ready yet to disclose what those areas are today, but as soon as we make some with some more progress with this and I think we'll be able to talk about that in the near future.

But areas. These include.

Great. Thank you everyone.

Thank you Hi, Josh.

Thank you.

Next question comes from Joe <unk> from H C. Wainwright. Please go ahead.

Hey, everybody good morning, and thanks for taking the questions.

Hi.

I think some really good questions about the market dynamic and I guess.

As you guys continue to block and tackle.

Getting more patients on <unk> because of the ongoing need for rescue therapies can you remind us first.

About the current patients and how often they need to get a new prescription either through exploration or other.

Yes, that's an interesting question Joe typically this is 12 months.

<unk> in the U S.

So every 12 months to need to be renewed we see some trends.

Some of that due to COVID-19, where plans because they couldnt handle every 12 12 months.

<unk> extended that to a number of years and then they got back and did it for three or six months, but generally speaking I think it's still the 12 months prior authorization that is actually very valid in the U S market and.

A lot of that is concentrated in the beginning of the year. So patients that have been on drug for a long time, mostly are getting their prior authorizations renewed.

Some times during the first quarter, which is of course, a lot of admin work for those offices doctors' offices, and we have our teams to help the doctors offices at process paper work.

Facilitates their whichever way, we can and that is of course, what all rare disease companies do.

To actually make sure that patients are not without any medication anytime.

During that process, because it can be a bit of a tedious process from time to time.

Got it makes sense and then so.

My main set of questions really focuses on logistics and maybe some information that might be a little out of your hands.

I appreciate that ahead of time, so first with regard to BD, obviously, <unk> been saying for quite some time now youre looking to be opportunistic with regard to expanding the pipeline in rare diseases and what have you. So just wanted to do a bit of a status check with regard to where some of these discussions stand then level of maturities.

Yes, yes, we got a lot of.

Most of inbound Joe from various banks that we work with.

And the Consultancies and of course, our own folks.

A lot of inbound stuff.

And a lot of it is is unfortunately.

Repurposed molecules.

And then.

For some rare indication, where sometimes you don't.

One rare disease not the other one.

Lenny ownership serves a <unk> disease, which is very severe.

And as it is a very high unmet medical need and as you know some of these rare diseases may not be so severe and these repurpose molecules may not be the business model as youre looking for because there is either already generics available <unk>.

Inside or outside of the U S and we do not believe that this is a sustainable business model.

But we're looking for more true innovative treatments and then your ownership as a good <unk>.

<unk> in that case in point, yet so in other words.

Being very very precise.

Also because it's our first M&A deal of course, so we better get out right.

It takes maybe a little bit more critical approach from our side on the other hand, we've been very close.

There's one or two companies opening over the over it.

This year, we came very very close and at the NCI decided to still step away because we couldnt validates.

And the specific rare disease, we couldnt really validate.

The numbers that this company was quoting for these patients and of course, that's always the case in rare diseases right.

In rare diseases. The numbers of patients that you find is a critical issue and we have build up a significant database in a meanwhile, with our genetic testing of genetic diseases.

Also have got a significant amount of other data that we have we think we have very good insights.

A number of mutation patterns that leaves to certain diseases, and therefore that helps our business development folks to actually make a choice.

<unk>, who is an integral part of that group.

Since Youre, noting has had opposite me that this is really always a challenge here, but.

But.

We're very active in this market and as you know with business development can havent say could be very soon could be another one bounce.

Bounce soften and we have to continue on and we continue our search but we have increased our capacity significantly over the last year. So over the last year also I think learned from some of these experience where you spend a lot of time and then eventually decided not to do it.

You want to add something here I got it.

Oh, sorry go ahead Jim.

No no I was just going to say no. That's really helpful and it's always great to see when.

At our Ogden Simon agree not in each other at the table.

Go ahead sorry.

No I was just going to add that yes.

Look at a whole range.

Different opportunities and do it in a systematic way and.

Simon said, we want to be cautious and careful.

To make sure that we bring in the right opportunity.

We could add value and we can leverage the work that's already been done.

Got it and then just lastly, and this is really the part I alluded to where your hands might be tied with regard to how you answer it so with 105, obviously theirs.

A bit of a growing excitement for potential gene therapy around.

He certainly came out of our reach in the recent Haa conference that we hosted so I was just wondering right now youll Youll give us information as it comes out is there anything that we could look to even without timing.

That says that plan would be to release X type of preclinical data to be able to tease the profile of the asset.

So that's really the goal here right. So I think first of all what got us into this position provided we entered this partnership.

With Orchard was that we believe again around C. One inhibitor, we believe C. One inhibitor.

The root causes we know it's the root cause of these patients that we wanted to be able to provide these patient placebo an inhibitor in the same way that we do with Rubicon announced to be able to do that with a gene therapy.

The other modalities that we looked at really didn't.

Present themselves with Bill.

Reliable way to do that so the goal now in terms of the preclinical models is to be able to use a factor.

That now has been.

And by the team at Orchard and to be able to show that <unk> been actually increase serum <unk> levels. In these disease models. So these are disease models being.

Knockout mice that have.

Don't have to see when the Virgin in place and now can you increase those levels to levels that we think would be meaningful in clinical situations and we're doing that testing now so I'm hopeful to be able to provide an update on that soon.

But those are the.

Type of information that we can look for is can we show meaningful increases in sealants over expression levels.

In these preclinical disease models that could translate into the type of benefit that we would need to see in patients.

Thank you guys.

Yes.

Thank you.

Question comes from Simon Scotia, SaaS spanning Simon. Please go ahead.

Yes, Hello, Thanks for taking my questions.

Okay.

Paul.

So you mentioned you've identified 400 potential linear <unk> patients.

Just wondering if you could tell us how many of those are if any are pediatric patients.

Then on the ICD 10.

Designation in the last call.

On this call as well you've mentioned that this gives you the consistent reimbursement discussions.

I was just wondering how these reimbursement discussions are progressing I mean, because do you expect and expect to complete them.

By the time of approval in the U S in March.

And then on pricing of linear ownership.

To what extent you can comment.

Just wondering if you expect.

I mean, presumably the difference in pricing with this product between Europe and the U S is not like to be any any any way as large as it is with some reconnect.

Just wondering if you expect any pricing differential of tool.

Yeah.

What the size of the pricing differential might be light compared with reconnect.

And then lastly.

So you mentioned that there aren't any.

<unk> inhibitors.

Currently C. One inhibitor products currently under development.

Does that also.

Extend to see one gene therapies besides urine.

Pipeline products.

Okay. Okay. So maybe I don't know if you wanted to say something about the patients and the sure. So.

Okay.

I'll take the first question Simon and then the last one.

The with respect to the patients that we're finding in the patients that we own.

That were in the study it's important to note that.

First of all this is a genetic disease of these patients are born with this genetic abnormality that have these variance in one of these two teams at birth.

And the disease. It can begin to manifest itself very early in life. So it is a.

It is a serious disease and that manifests.

It manifests very early and then it is progressive so it gets worse over time.

In the clinical trial.

We identified and treated patients that were at least 12 years of age and about half of the patients were actually.

In this age range between 12 and 18 I think the median age was actually 19 so.

There was a significant portion of patients.

<unk> 12, and 18 years old which.

Their adolescence, but theyre in the formal definition, that's still pediatric patients.

Beyond that so the in this younger age group, we arent finding patients in that age group as well and it's positive.

It's probably in the range of around 20% to 30% of patients that we're finding are even below the age of 12.

So hopefully that gives you some idea of the time.

So patients that have been treated so far in the clinical program and the types of patients that we're finding but also that we're planning for clinical trials in this younger population too because there certainly is an unmet need there.

Looking into the future wouldn't it be ranked as the disease becomes more known and more recognized that these patients are.

Caught earlier, because now you see it takes many many years before him.

Diagnose right so <unk>.

<unk> do you get the better right Christine I think certainly as we increase disease awareness, but also hopefully a treatment becomes available a specific treatment because global that also oftentimes didn't drive further diagnosis. So I think those were all sorts of trends.

In a favorable direction on the question of.

Other C. One inhibitor therapies in development. So I think really Simon was alluding to.

There is no acute C. One inhibitor therapies in development.

And Theres really no actively promoted acute C. One inhibitor therapy other than there is supply.

Plasma drive therapy also but the.

There are gene therapies.

<unk> from our program that are in development.

Okay.

I think different modalities different mechanisms to deliver.

The vector and to be able to.

You'll see one inhibitor, so I think but I do think that we have still a unique method of method.

Partnership here with the Orchard that could be differentiating about with respect to this ability to express PD one inhibitor.

Okay and then.

Simon you had a couple of questions about pricing of course.

We do not.

Give any guidance on that.

Because we always think that analysts are the experts on this.

Hi.

To make up their minds, what they think is typical pricing.

With regards to your question about.

The.

Difference between pricing in Europe , and the U S. I think there's also a number of Cui.

Quite a number of rare disease compounds are on the market.

And you can actually see what's the difference is between Europe and the U S.

We think it's typically in the 60% to 70%.

European price so typically in the 60% to 70% range of what the U S prices. So the price gap has significantly narrowed ownership can be significantly narrower and these are rare diseases.

Don maybe mass market to diseases.

We're all sorts of reference pricing systems kick in and that's of course not the case.

Certainly with the rare diseases, so hope that answers your question as well.

And last week.

ICD 10 codes important because you can get.

You can work.

And indeed, you got it right that you can work ahead to actually discuss coverage not necessarily reimbursement because the U S of course is decentralized healthcare systems, where you serve a number of government funds.

<unk>.

Like Medicare and Medicaid systems for instance, dimension too, but the majority of the markets of course private market commercial market as we call. It and there you get coverage by the by the Big insurance companies and the Big Health care plans and Thats of course, having an ICD 10 code is incredibly helpful. In this respect otherwise.

It may take quite a long time before this.

<unk>.

Patients could be reimbursed so yes, our folk are really preparing there.

To actually get coverage for the patients immediately.

Obviously, the product comes on the market and that is of course.

The nice thing of the United States market that these things are are progressing away faster than sometimes in the European markets because.

That's also the issue in the European markets is often despite the fact that you have a rare disease and it takes quite a considerable amount of time before you've got you've got a reimbursement and of course your own country is a positive exception, Germany to that but as you know many more European companies are countries take a lot longer to unfortunately.

If patients that therapy, so badly needs, but we will do our utmost best obviously also to accelerate the rollout of this.

Unique.

Very severe rare disease as quickly as possible in the European markets and the good news is again.

Is positive exception as possible if you have a good dossier and if you have a good.

Good health economic underpinning and Thats across where our teams are working around the clock on to actually make sure to happen. So that we can.

Swiftly got hopefully reimbursed in all of the European Union markets as well I hope it answers your question sorry for a bit long winded answer no thats very helpful. Thanks very much.

Thank you.

As a reminder to ask any further question. Please press star one on your tenant.

Pat.

Maybe color you have nice to ask the question Tony.

I'll now hand, you back to the management team for closing remarks.

Thank you very much operator.

Ladies and gentlemen, thank you for attending our nine months 22 conference call on the results and as we come to the end of this exciting year 2022, where we were very successful not only with of course, continuing the growth of <unk> sales, but also securing the.

The FDA and EMA.

Accelerated.

Review, which again is very rare that you get it on both sides of the oceans.

We look forward to what's moving into next year, where we anticipate that we could have.

<unk> data that we have <unk> date of 29 March.

And could go into the U S market soon thereafter and of course, the accelerated review by the Europeans, where we could actually also go into the markets.

I get to positive positive.

The market got a massive marketing authorization.

Before the end of the first half and <unk> as soon as possible into the European markets and lastly.

UK market of course, where we can work on the direct that recognition.

We had a very busy.

Back to a very busy two at 22.

We look forward to a very intense 'twenty suite, where we missed.

We'll be starting to.

To execute on the significant transformation of our company.

One product company in one geography to watch a multiple product company in multiple geographies driven by our own commercialization infrastructure on both sides of the oceans.

Concludes this.

This conference. Thank you very much for your attendance again, and we look forward to updating you.

Probably somewhere in March on our full year results for 2022, Thank you and have a nice day goodbye.

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