Q3 2022 United Therapeutics Corp Earnings Call

[music].

Good morning, and welcome to the United Therapeutics Corporation third quarter 2022 earnings webcast. My name is shantou and I'll be your conference operator today.

All participants on the call portion of the webcast will be in a listen only mode until the question and answer portion of this earnings call.

If you would like to ask a question during that time simply press Star then the number one on your telephone keypad, if you'd like to withdraw your question simply press Star then the number one again on your telephone keypad.

I will now turn the webcast over to Dewey Steadman head of Investor Relations at United Therapeutics.

Good morning, It's my pleasure to welcome you to the United Therapeutics Corporation third quarter 2022 earnings webcast.

With me on today's call are Dr. Martine, Rothblatt, our chairperson and Chief Executive Officer.

Michael <unk>, our President and Chief operating Officer, James <unk>, Our Chief Financial Officer, and Treasurer and checkpoint pathways on our executive Vice President of technical operations and Dr. Leigh Peterson Senior Vice President of product development.

Remarks today will include forward looking statements, representing our expectations or beliefs regarding future events.

These statements involve risks and uncertainties that may cause actual results to differ materially our latest SEC filings, including forms 10-K, and 10-Q contain additional information on these risks and uncertainties, we assume no obligation to update these forward looking statements.

Today's remarks may discuss the progress and results of clinical trials or other developments with respect to our product.

These remarks are intended solely to educate investors and are.

Not intended to serve as the basic basis for medical decision, making or to suggest that any products are safe and effective for any unapproved or investigational uses.

Full prescribing information for the products are available on our website now I'll turn the.

Cost over to Dr. Rothblatt for an overview of our third quarter 2022 financial results and business activities of United Therapeutics.

Thanks, Julie good morning, everyone.

Currently we are helping about 12000 patients, including over 10000 <unk> patients a high Mark for our company and we are making great progress on our goal of 25 by 'twenty five meeting, helping 25000 patients by the year 2025.

Now achieving that goal will require annual growth in patient adds per quarter over.

Over the past year, we have increased our patient adds per quarter by about 66% from our historic rate of around 300 per quarter in 2021 to around 500 per quarter in 2022.

Of course, there are monthly ups and downs and quarterly variability, but maintaining even half our current growth rate for the next three years seems eminently doable and will allow us to nail 25000 patients by 2025.

Further supporting the achieve ability of continued growth in quarterly patient add rate is that we have really just begun with multiple new products and new product information.

For example, we have just started our <unk> relaunch, we have just released our expedite top line results for our rental tram and we've just commenced our <unk> group III penetration of ILD with Thai VSO.

And then on top of all of this we are at the very beginning stages of a truly warm embrace by physicians patients and Payors of Thai base. So DPI.

Hence with three years to go to 2025, and a 30000 patient group three market waiting to be penetrated with <unk>. So we feel confident that year. After year, we can increase our quarterly patient adds at the rate needed to meet our announced goals.

Now upon getting even close to 25 by 'twenty five we expect our revenues will be about double what they are now since right now we have about half that number of patients I believe that level of double PIH revenues will be sustainable well into the 2000 thirty's due to our expect.

<unk> launch of once daily relented Peg and continued patient focused improvements in delivery systems, and then protocols for <unk> Taipei, So annual rental trial.

Now on top of all of that we expect soon after 2025, a successful outcome of our two key ton phase III trials in pulmonary fibrosis also known as I P F.

That new indication for us with about 100000 U S patients will enable our revenues to grow so rapidly that by the end of this decade I expect our IPF revenues will actually be even greater than our revenues.

In other words by around 2030, I would expect to see something like a 60 40 split of $10 billion in revenues between IPF and PIH.

Meanwhile, I believe this past year, we have proven that genetically modified Zeno grafts and labs cellular raised Oregon scaffolds are practically doable.

These achievements are the technology from which we plan to produce an unlimited supply of hearts lungs and kidneys.

We will use the next few years of rapid growth in ph and IPF revenues to flesh out the numerous aspects of turning our technological accomplishments into the preclinical clinical and commercial manufacturing precursors of an.

<unk> new transplant business.

As our PIH revenues start to plateau in the 2000, <unk>, we should be ready to ship thousands of lifesaving manufactured organs each year.

In summary, Ut has a pragmatic.

Step by step business plan of are more unique and important products that produce ever more value for patients.

<unk> and Payors.

Furthermore, this business is resilient against generic products due to our unique drug delivery technologies and it is resilient against <unk>, such as <unk> or existing drugs, such as an impediment.

Pirfenidone due to due to our additive or therapy stacking approach to treatment.

We all feel extraordinarily fortunate to work a duty for multiyear goals as is evidenced by our industry, leading retention rates and multiple best places to work awards.

With that high level overview, let me now turn things over to our President Mike Bank of width for a whole raft of really great news.

Mike Thanks, Roxanne and good morning, everyone.

Overall, we're extremely pleased with our third quarter commercial performance, we set a number of records on an overall and product by product basis during the quarter, but I want to highlight three of these milestones that we're particularly excited about.

First for the last couple of quarters, we have been saying that we're effectively at a $2 billion revenue run rate and.

In the third quarter, our total revenues crossed $500 million for the first time in our history, which puts us in fact on a $2 billion run rate.

Second as Marty mentioned, we exceeded 10000 U S patients at approach 12000 patients worldwide on one of our approximate therapies drive ACO type ACO DPI remodeling at our radar trap.

Finally, <unk> revenues exceeded $250 million for the quarter.

Which puts that product on a $1 billion annual revenue run rate.

As many of you know a drug that generate $1 billion in annual sales is widely considered to be a quote unquote blockbuster product. So the first for the first time in United Therapeutics history, we have a product that has reached blockbuster status at least on a run rate basis.

These results are due to the efforts of our commercial and medical affairs teams, who have been working hard all year, but had been particularly effective in the last two quarters to help get us to this point.

Now I'll provide a little bit of color at the product level, starting with Asia.

As I said, we reported a really strong quarter for <unk>, which was driven by a number of factors first the third quarter was our first full quarter with CMS or Medicare coverage for patients with ph ILD. So that prescribing obstacle has been removed.

Second our continuing efforts to educate prescribers, particularly those ILD specialists to screen their ILD patients for ph is having an impact.

Third we continue to grow our prescriber base since the beginning of 2021, the number of <unk> prescribers has grown by approximately 50% and.

And finally, the big driver was the launch of today's at Epi as.

As a result of these things we added 500 <unk> patients during the quarter.

Regarding the <unk> launch physician engagement and enthusiasm around this new product is extremely high.

Often in the ph space, we see and hear enthusiasm around our new product launch, but it took some time for that to translate into referrals, which is our term for prescriptions and then patient starts.

Fortunately the <unk> has bucked that trend as referral activity has been very strong from the beginning.

For some context, we said in the past that we expect the patient mix between type ACO DTI and <unk> delivered via the TD 300, nebulizer to eventually settle out at around 50 50 over time.

While our <unk> new patient referral mix is already at around 50 50.

Meanwhile, transitions from the <unk> 300 to DPI are occurring as expected.

Also while still very early we're really encouraged by the low discontinuation rate of patients using <unk> epi as compared to other processes class therapies.

Turning to modulate in the third quarter, we saw a continuation of the strong referral patterns, we've seen throughout 2022 and relative resilience and stability of the business. Despite the availability of generic competitors. The relaunch of the <unk> room unity pump is proceeding well and we expect community starts and total patient autoimmunity to grow over the balance of the year.

And into 2023.

In September we launched a patient fill version of our reentry pump that complements our presale pharmacy distribution option.

The patient filled option is being introduced for patients who prefer to fill their own cassettes and receive for module and shipments on a monthly basis, rather than a weekly shipments of Prefilled cassettes.

<unk>, both pre filled and patient filled options is expected to broaden and accelerate uptake for <unk>.

Continued adoption of the remuneration pump is becoming increasingly important to ensure that patients do not experience a delay or disruption in the remodel and therapy.

One of the prior pumps used for subcutaneous <unk> delivery, the Smiths medical Cat M. S. Three pump was discontinued by the manufacturer in 2015.

At that time, United Therapeutics funded the manufacturer of several thousand additional pumps and in parallel pursued development of the community to ensure module and patients would have a pump for their therapy.

Earlier this year, we sold our remaining inventory of CAD three pumps to our specialty pharmacy partners in hospitals and it is our understanding that the available available inventory of MSCI pumps at those specialty pharmacy partners and in hospitals for both the pumps that we funded as well as other MSP pumps that may have been on the market.

Is winding down Fortunately there are immunity pump is on the market and available as an alternative for subcutaneous realized one patients.

Moving to <unk>, we released top line data from the recent phase for expedite study investigating the rapid titration and transition of functional class II and III ph patients from a module into a rent a tram.

This study demonstrated that with this treatment approach a patient can reach a therapeutic dose of <unk> faster and with fewer side effects than starting to novo.

Over the long term, we expect <unk> will continue to be an important part of our product portfolio and the ph treatment armamentarium and patients at either prefer oral medications have failed anti VSO or want to transition from a module and after their right ventricular function has normalized.

The expedite protocol provides physicians with a roadmap to effectively use <unk> in these patients.

To wrap up as many of you know we established a goal last year to double the number of <unk> patients from 3000 to around 6000 by the end of 2022.

We established this goal to address questions around and to frame the existence of one ph ILD market to the size of that market and three how quickly we could tap into it.

As at the end of October we have around 5600 patients on <unk>. So we added two more than 250 patients in October alone.

Specialty pharmacy has around 500 pending referrals for new patients that are making their way through the insurance approval process and then can be scheduled for patient start.

Those 500 referrals exclude referrals to transition from the TD 300 DPI.

Our average monthly type they still referrals that each of the last three months are around 75% greater than the average monthly referrals pre DPI launch I am sure that the drop in November and December with the holidays, but they should remain above the pre DPI average. So I think it's fair to say today, we're demonstrating that there is a ph.

The market and we've tapped into a relatively quickly thus the objective of setting the 6000 patient goal had been accomplished.

Typically the fourth quarter can be a little challenging for us because of the holidays, which reduced the selling days clinics clinician days and shipping days not to mention that new patients, especially once we get between Thanksgiving and Christmas sometimes choose to delay therapy initiation until after the holidays, having said that and based on the staff that I just provided.

We are well positioned as it relates true to our goal of around 6000 patients 6005, Asa patients by the end of the year and we're continuing to build really good really good momentum heading into next year.

So with that I'll turn the call over to Martine to lead the Q&A section.

Mike that was a raft of really great. So I was totally accurate then that <unk> TF I'll save.

Operator would you please open up the phone lines for any questions.

At this time I would like to remind everyone to ask a question. Please press star one to allow time for everyone to ask a question. Please limit yourself to one question.

Our first question comes from with.

Jeffrey Your line is open.

Thank you great quarter. So if I heard you correctly you added.

500 patients to time based on this quarter.

Same number as in the second quarter, our <unk> sales.

Sales are a lot higher.

Because I guess.

According to your comment.

Patients, who got on preneed already on but at the same time given the.

Tremendous sustained good growth quarter over quarter.

Is it fair assume that patient to get on that.

DPI would that be more from the new patients instead of switching from Navy laser. Thank you.

Thank you Yan.

Appreciate your question and Mike.

Mike I think you got the most.

Context.

Sure.

Yes.

I think on the revenue I think the other thing to keep in mind in terms of comparing that number of patient adds versus the revenue growth is that in the third quarter.

The vast vast majority of those patients for commercial patients, whereas in Q1 and Q2, we did not have the CMS coverage. So you still had.

The number of patients that we're going through our patient assistance program are receiving free drug. So again those those patients will stay on through the end of the year start to transition to commercial drug after the first of the year, but that I think explains some of the difference.

And the revenue between Q2 Q3, even though the patient adds were.

We're about the same.

In terms of the DPI.

Terms of the patients coming coming on.

I will say that.

The DPI uptake the uptake has been faster on de Novo then transitions and I think thats just a function of as were out talking with physicians.

Proactively calling their existing <unk> patients and to transition them to DPI Theyre just waiting for the next regularly scheduled to platelets. So as I said in my opening remarks, those transitions are occurring they are just going to if they're going to occur over a little bit of time as physicians are waiting for the patients to come in for their for the next appointment.

Alright, perfect. Thank you operator, we are ready for the next question.

Your next question comes from <unk>, Zhang with Oppenheimer <unk> Company. Your line is open.

Okay.

Great. Thank you really nice update all.

Thanks, Martijn just one question.

I was lucky enough to be yet.

Towards society in Barcelona, a few weeks ago.

Interesting to hear some of the excitement.

Around the GPI pump I mean.

Essentially a third generation pump your second.

Versus potential.

Potential competitors that could launch on the market whenever whether its this year or next year or the year after that but can you just speak to that a little bit about how advance.

With Upi pumping is and why that should be a competitive advantage regardless of competition in the future. Thank you.

Thank you so much heart pause so great to hear your voice right at the top of the call and.

I am not surprised that you would be at the RF. You are you are the person in the industry, who has got I think nobody above them in terms of you're going into the deep scientific research.

The different.

Medical conferences.

In terms of the details of answering your question I think may be again, Mike I might ask you to.

To hit on that since since you've really shifted at that DPI, all along the way sure happy to so I think.

We agree with your heart highs, we do think that the DPI does.

But position us.

Well against any current or future competitors.

Certainly I think that can be that convenience.

The size. The fact that it's one breath four times, a day and instead of nine to 12 <unk>.

Provides.

Got a convenience advantage over the nebulizer so so.

That certainly helps in that regard and then I think as we get into.

Yes, looking at potentially other competitors for DPI that come on the market I think there's a couple of things that work in our favor one is.

Just I think just to United Therapeutics support services. The fact that we've been on the market for 25 years physicians tell us they know that we're committed to the patients that stuff that actually matters.

To physicians and then as it relates to the path I mean, one of the things that we're particularly proud of and think.

It was really a good thing for patients is that the DPI is what we call a low flow high resistance device.

And so that May sound, a little counter intuitive but.

But thats actually an advantage because with the low flow high reserves with high resistance device.

You're relying more on the pop to do the work and less on the patient.

So what that does.

It means that a strong breadth is not required to deliver a consistent dose.

To the distal airway Airways, it's only one breath per cartridge and under three seconds.

And it allows the.

Device to deliver the drug more efficiently so target dose titration was nine to 12 breaths.

Equal to about 54 to 72 micrograms.

<unk> delivers that same equivalent dose with 48% to 64 microgram. So it's actually takes less drug to deliver the same the same amount of drug.

And it also ensures that the delivery.

The medications delivered evenly in the Airways as I said.

And deep into the lung. So we do think that that combined with just kind of the easy kind of open load and health administration.

Positions us very well in the marketplace totally.

Perfect response, very insightful questions, operator NEC stuff.

Our next question comes from <unk> <unk> with Morgan Stanley . Your line is open.

Hi, good morning, Thanks for taking the questions maybe a two part for me on <unk>.

So I was wondering if you can tell us anything about the current Medicare mix I think in some real world studies in ILD, it's about 50% of patients overall would be eligible. So just wondering if youre seeing something similar there and then.

That will as we think about kind of a step up in coverage in 'twenty three maybe you could speak through that Mike and then just wondering any early read on the duration of therapy with timing so for ph ILD and how that compares or how do you expect that to compare to the ph setting. Thank you so much.

Yes sure so.

So the first question on the Medicare on the mix of Medicare or commercial.

Essentially what we see is it's roughly a 50 50 mix it.

Varies month to month, but I think 50 50 is a good number to kind of model off of.

In terms of what to expect next year with respect to the Medicare patients that are that are in our patient assistance program transitioning to commercial so as of right. Now I think we have around 700 to 800 patients and our Pap program that our ph ILD patients.

With Medicare insurance.

So we think a majority of <unk>, probably not all but the majority of those will transition over beginning in Q1, so that will obviously I think helpful.

From a revenue standpoint as.

As we head into next year.

Brian what was the second part of the question.

Okay.

Duration of therapy.

Yes.

I think you have to say I'm sorry, our.

A therapy.

Yes, it's I think it's still a little early to tell it.

As I would say early on what we're seeing is I think that positions. We're taking there I would say, they're more advanced stage patients transitioning over.

The monetization so they werent staying on as long.

I think as pay as the physicians are starting to.

Understand the increased data better understand how to use <unk>, so understand how to dose, particularly of the newer treaters.

That's starting to improve so it's.

Really I think too early to tell whether there's a distinct difference between.

Ph patients in ILD patients because I think we're again, we're still we're still sort of I think kind of a ramping up these ILD treaters on Windsor right time to put these patients on <unk> basis, I think that'll that'll that'll play out over time, we would work towards sort of expecting that once the dust settles, there's going to be roughly the same.

Great. Thank you very much.

<unk> great to hear your knee platform, there with Morgan Stanley Operator next call.

Our next question comes from Joseph Tung with Cowen and company. Your line is open.

Hi, there good morning, and congrats on the progress and thank you for taking my question.

In terms of penetration into that ph ILD market now that Medicare is behind us.

Is it really just patient identification that is key here.

Or if there are any physicians that do have identified ph ILD patients maybe what are they waiting for before placing their their patients on that day. So thank you very.

Very interesting.

Question.

Joe and.

And Mike will be able to.

Dress it, but just as a as a <unk>.

Key up as.

Mike's gathering his thoughts here just mentioned.

We are talking about 30000 patients in this Iot market.

Is it is.

Almost like ph was reborn.

As Iot.

From the standpoint of United Therapeutics.

<unk> a lot better because while there are.

I have actually lost track of how many drugs are approved for ph 12.

A reasonable guess.

14.

Sure.

Almost none of them can be used in Iot because of the very real problem <unk> mismatch, which I was talking with the physician the other day and they were telling me directly that.

One time for a patient who theyre trying to transplant.

And gave them a little bit of slowdown.

To try to help bring down their pressures before transplant, how horrible GQ mismatched right away.

<unk> held.

Prostacyclin and were able to successfully reach the patient over to transplant.

<unk> mismatch is a horrible problem. So thats basically eliminates all the systemic drugs with either oral or parenteral.

From.

From the story.

Penetrating these 30000 patients now due to the amazing work.

Dr Peterson and her team who are on the call and produce the stellar increase results demonstrating.

It was a strong safety and efficacy of Thai base. So.

For Iot and then you couple that with the wisdom of the FDA in enabling whether it's nebulize tavy, so or DPI.

To be used in Iot you have like just a very sweet situations from a pharmaceutical company standpoint of being able to rapidly help op.

It's a 30000 patients who were had no previous treatment whatsoever.

This is why you heard the astounding numbers, Mike was getting being in terms of quarterly and monthly ads and the big step up that we've had from 'twenty one to 'twenty two alright, very conservatively, we think that that kind of step up.

Averaged across 23 and averaged <unk> 24 in average across 25 will sync up with what we need to achieve 25 by 'twenty five so basically everything is is in the right place.

Up to us to execute.

Expertly and Mike maybe if you can just give a few insights on our execution there yes sure.

Don't think its the case that you.

<unk> got physicians diagnose their patients with the.

The ILD patients with pulmonary hypertension on it are just sitting back and not prescribing Taipei, So I think the.

The name of the game here is actually screening for pulmonary hypertension.

Yes.

In my opening remarks, I made I made a comment about the fact that typically when you have a new product or a new indication.

A lot of enthusiasm, but then it just takes time for kind of traction develop but we haven't seen that with DPI, but I think ph ILD is probably an example of the norm where theres a lot of enthusiasm, but then the actual call to action and getting people to move in and change behaviors has been I mean, it's been good it's probably been a little bit slower than what.

We would have expected.

But it's starting to happen and I think part of that in the case of ph ILD is the fact that you've got particularly with these ILD treaters.

There is a term that I continue to hear called like therapeutic diet nihilism. So these are typically really really sick patients that I think the doctors are really just.

Unless the patients are going to get a transplant. There are long term outcome is not good. So there is this behavior modification. This behavior shift that we have to we have to undertake and execute with these doctors to educate them on the fact that the prognosis for these patients if they have pulmonary hypertension is like twice as worse.

If they just have ILD.

The first thing and then the second thing is that we have we have an indication to treat the treat the symptoms of pulmonary hypertension and so.

So we're starting to we're starting we have been making in roads. There I think there's still a lot of opportunity ahead of us.

I do think at some point and I'm not sure what the quarterly patient numbers, but theres going to be a tipping point here, where I think the floodgates are going to open and it's as these ILD treaters become more accustomed to screening their patients.

And then once the patients are started on high Bay. So they see the benefits and I think once that happens like I said I think we're going to see just I think another kind of step function in our growth perfect. Mike. Thank you. So much operator next question. Please.

Our next question comes from Jessica Fye with Jpmorgan. Your line is open.

Hey, guys. Good morning, great results today.

Martine at the beginning of the call you were talking about your expectation for quarterly patient and even if they are sort of half of what they've been in 2022.

Put you on track for your long term target I guess in the near to medium term do you see those ads is largely timing.

And then and maybe just kind of a housekeeping question beyond the four key factors you mentioned like the holidays was there any favorable ordering patterns in the third quarter and to help the Televisa number that we should keep in mind when trying to protect for key revenue. Thank you.

Yeah.

Thanks, Jeff Good to hear your voice this morning and.

And also.

Once again, just wanted to having the chance to talk with you here on the call. Thank you for Jpmorgan inviting us to speak at the.

Hep D.

Major event that you've had in New York honoring women entrepreneurs and women in business and focusing on the importance of that and.

And house on our thanks to Jamie Demong Diamond that was really exciting to be with him there at that conference so going onto the particulars of your question Hi.

I do believe that I'll answer the first part and Mike If you can answer the second part.

So I do believe that <unk> will be the big driver of.

This growth that we anticipate in quarterly ads.

During 'twenty three 'twenty, four and 'twenty five however.

However, as I mentioned in my opening remarks, we do also believe there will be contributions from our other products and.

At one time of might've seemed like hopeful thinking that they spoke to become a blockbuster.

I think we're I think we're there and we will continue to grow on that.

Right now it might seem a little bit hopeful to think that <unk> could become a blockbuster, but with the type of results youre seeing in.

In expedite and we have another even stronger study going on called artisan, which will show the same sort of thing that.

Physicians throughout the world and you've seen these posters no doubt it.

<unk> and other conferences that physicians have shown that if they aggressively dose remarks UN over a short period of time, bringing pulmonary artery pressures down below 35 millimeters of Mercury.

Fast switch their patients to a high dose of <unk>.

Oral equivalent prostacyclin that they are reporting.

Pretty much like capital Meier survival level close to 100% at 10 years, and even 15 years out.

It sounds like it's like a way to manage pulmonary hypertension as a lifelong disease that you use where modglin for a relatively short period of time.

Three months six months, maybe up to a year and then as expedite showed we could fast switch the patients to double the dose of a revenue trend that they were out.

Previously <unk>.

And also they are already acclimated to the prostacyclin side effects. This way from the parenteral experience. So now you get like the best of around the tram right upfront rather than the previous.

A couple of years since launch they had kind of the worst effects of a rent a tram upfront and maybe gave up before they got to the best effects. So this is what I mean by the new <unk>.

Prescribing data.

With regard to.

Our rental trend I think <unk> will be also a major contributor not as big as Thai base, so not as big as certainly as time based so DPI type ACO DPI is the star of the show and and Thats why I say there was a warm embrace.

Physicians patients payers it is going to be the star of the show, but very important are like best supporting actress Best supporting actor. All of these people are very important to us.

And I also mentioned new delivery technologies that we're working on.

Our modular enough time to go into all of those but there are there are a lot of supporting actors and actresses that theyre going to get us to this 25 by 'twenty five I'll, Mike joined to provide a little bit more granularity to the backend of justice sure. So.

I think just as your second part of your question was just around any anomalies in quarterly ordering patterns in Q3.

Short short answer is no that's something that we try to manage.

Pretty tightly because.

I think we've always talked about the fact that there is variability quarter to quarter.

And that's true to a certain extent theres not a whole lot. We can do about that but we do try and track pretty closely with our specialty pharmacy.

What theyre dispensing against what they're ordering and so one of the metrics that I always kind of look at is what's the value of what we're selling is specialty pharmacy versus the value of what they are dispensing to patients.

So.

Generally speaking.

There's about a 5% to 10% difference and that can go either way so it could be or 5% higher on sales versus dispensers or it could be were 5% lower than typically what we see is that smooths out over the course of 12 months or four quarters. So.

Third quarter, we were kind of within that range. So nothing nothing unusual there in terms of expenses and sales. So so no anomalies there.

Like I said, we continue to monitor that pretty closely because we do want to have we want to minimize that variability.

Awesome Awesome awesome.

They're time.

<unk> says there is time for one more question and he is the boss. So next question operator.

Our next question comes from Andreas <unk> with Wedbush. Your line is open.

Good morning, and congrats on the quarter and sensors.

Taking my question.

So as we looked at it.

So if you look at the evolving treatment landscape. How are you thinking about the commercial dynamics over the next several years between.

Youre constantly.

Cost of products and therapies with novel mechanism of action that could be coming onto the market in the near future.

Yes so.

Thanks for the question and I referred to this a little bit in the opening remarks that Ut has a long taken what I would call a therapy stacking approach to our.

Our pharma computer if you will we have a number of drugs.

They help a lot of patients but in most instances they are stacked on top of other drugs.

And they are stacked on top of other drugs first of all because that's how we get the clinical trial and what we did is we showed our drugs had such and such an effect on top of background therapy.

Why did we do it that way.

Well first of all it's a lot easier to enroll a clinical trial on top of a background therapy, which is generally used if you go in there and you say there is a.

Background therapy, that's already approved and already generally used and you say you've got a clinical trial, but the patients have to be naive to all therapy.

So first of all you have a little bit of a ethical issue I'm not saying, it's a definite horror.

Hard ethical issue.

Okay.

I don't often get to say that my degree is in medical ethics. So.

Okay fair to say it so there's a little bit of a medical ethics issue that it's better to be able to show your treatment works on top of background therapy than to take a patient who has a bad disease. There are approved therapies and you kind of condemned them to placebo only and what is really the.

The beneficent, it's about for that patient it gets kind of kind of hard to argue. So we've done you know random tram on top of background therapy.

Other.

Other companies and for example in our IPF trial, we're on top of <unk> and further down.

As background therapy, so other companies see the wisdom of this too and.

A lot of the studies of <unk> are also on top of background therapy. So I think this is the complexion of things in the future pulmonary hypertension is a multifactorial disease. There are at least six different.

Pathological pathways that have been identified process micron pathway nitric oxide pathway.

The.

Even toned.

<unk> pathways and.

Thromboxane calculate so all of these different pathways. So when you have a multifactorial disease like this it calls for a therapy staffing approach because different drugs can help address different pathways I hope that's responsive to your question.

And with that do we feel free to wrap up the call.

Operator can you go ahead and wrap up the call. Thank you.

Okay.

Thank you for participating in today's United Therapeutics Corporation, earning webcast a rebroadcast of this webcast will be available for replay for one week by visiting the events and presentations section of the United Therapeutics Investor Relations website at IR Dot U N I P. H E R.

<unk> Dot com.

Okay.