Q4 2022 Seagen Inc Earnings Call
Good day, everyone and welcome to the <unk> fourth quarter and full year 2022 conference call.
All participants will be in a listen only mode should you need assistance. Please signal conference specialist by pressing the star key followed by zero.
After todays presentation, there will be an opportunity to ask questions.
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At this time I'd like to turn the conference call over to the buffet.
As president of Investor Relations Sir Please go ahead.
Thank you operator, and good afternoon, everyone I'm pleased to welcome you to see Gen fourth quarter 2022 financial results Conference call.
This afternoon, we issued a press release with our results the press release and supporting slides are available on our website in the investors section events and presentations page.
Who will be David Epstein, Chief Executive Officer Chip.
Chip Romp executive Vice President commercial U S. Todd Simpson, Chief Financial Officer, and Roger tendency precedent of research and development.
Following our prepared remarks, we'll open the lines for questions.
Aim to keep this call to one hour and also that you limit yourself to one question to give everyone an opportunity to participate in Q&A during our call today.
Today's conference call will include forward looking statements regarding future or anticipated events and results, including the company's 2023 financial outlook anticipates it products.
Cost and expenses potential clinical and regulatory milestones, including data readouts regulatory submissions potential marketing approvals and commercial performance.
Actual results or developments may differ materially from those projected or implied in these forward looking statements.
Factors that may cause such difference include the difficulty in forecasting sales revenues costs and expenses and the uncertainty associated with the pharmaceutical development and regulatory approval process.
More information about the risks and uncertainties faced by T. Gen is contained under the caption risk factors included in the company's quarterly.
For the quarter ended September 30 of 2022 files with the Securities and Exchange Commission and the company's subsequent reports filed with the SEC.
Now I will turn the call over to David.
Thank you Doug and good afternoon, everyone. Today, we reported total 2022 revenue of nearly $2 billion, reflecting 25% growth over 2021.
This included record net product sales of $1 $7 billion, driven by meaningful uptick across our entire commercial portfolio.
Our sales guidance for 23 reflects our optimism and our ability to gain market share in existing indications and grow into newly labeled indications.
In a moment I will take you through the strategy, we presented at the JP Morgan Healthcare conference last month, but first I'd like to begin by reflecting on an exceptional year precision and noting a few 2022 accomplishments.
Beginning with our commercial products, we received regulatory approval and reimbursement decisions in multiple markets. We now have commercial presence in 17 countries.
We delivered robust development progress across our programs, including positive results for four pivotal trials that have already resulted in two label expansion and completed enrollment for two potentially registration enabling studies in our pads.
Hi to franchises.
We advanced our broad recently prioritized pipeline of differentiated assets, including potentially transformative programs like T. V. S. T N V six E and S. T N D seven each for V. While at the same time initiating phase one studies for multiple new drug candidate.
P. J and also entered into multiple corporate development agreements for new assets that are complementary to our expertise.
For example, we secured global rights to an exciting preclinical gamma Delta bi specific T cell engagements for Egfr expressing solid tumors.
And entered into a collaboration with Sanofi for the development of multiple novel ADC.
Looking ahead, we are focused on three strategic pillars.
First a focus on optimizing the full potential of our commercial portfolio are first or best in class products demonstrated clinical and real world benefits.
We're working to enhance our commercial execution, our footprint as well.
In parallel we're executing a robust clinical development programs, including 10, potentially Registrational studies for our approved products areas of opportunities spanning multiple tumor types.
These new labels could unlock meaningful growth across our approved brands and broaden their reach to significantly more patients in need.
Et cetera is further demonstrated its clinical value in 2022 with important data readout, a label expansion and three sequential quarters of record sales.
Et cetera to the U S standard of care in frontline Hodgkin lymphoma have seven U S indications following the approval of a pediatric label late last year and is expected to reach blockbuster status in our territories in 2023.
Outside of the U S and Canada, our partner Takeda continues to deliver et cetera are in international markets and their product was recently added to the national reimbursement drug list in China.
I'll now turn to <unk>, which we believe has the potential to become our second blockbuster Brown the.
The FDA granted priority review for an application seeking salaried at approval for the combination of types of N. Keytruda in first line metastatic bladder cancer for patients that are cisplatin ineligible.
Target action date of April 21, 2023.
Our goal is to advance paths of utility into earlier stages of bladder cancer and our robust clinical development program includes both muscle and non muscle invasive Forbes represented even larger potential patient segments.
We continue to evaluate padsaw beyond bladder cancer and expect to report data from the solid tumor study later this year.
We're also looking to expand paths of globally in partnership with Astellas. Following its approval in the EU and other countries, including Japan.
Moving onto to Kaiser This brand provides significant benefit for adults with her two positive metastatic breast cancer, particularly those with brain metastases two kaisers now approved in 39 countries and we continue to make progress expanding its use outside of the U S with multiple country launches planned.
In 2023.
Last month to Kaiser received an accelerated approval for patients with previously treated her two positive metastatic colorectal cancer and it was subsequently added to the N CCN guidelines.
This is a modest size, but important population as these patients typically have poor outcomes following progression on frontline therapy.
Our broad development program includes a combination of two Kaiser with Adcs, such as Cats, Iowa, which is used in second line plus metastatic breast cancer in a trial called her to climb auteur.
Our partnership with Merck also extends through causes reach outside of the U S Europe and Canada.
<unk> is our newest commercial product it continues to receive recognition as an important treatment option for cervical cancer. Chebec is now a preferred regimen for second line or subsequent recurrent or metastatic cervical cancer per the <unk> guidelines.
And our partner Genmab are advancing a phase III trial that can support international marketing authorizations as well as serve as a confirmatory trial in the U S.
The potential top line data expected by year end 2023.
Our second strategic pillar is to prioritize the clinical development of assets that we believe will have the most transformative impact on patients and our business.
We recently initiated a portfolio prioritization discipline to critically access data.
Janssen success, unmet medical need and potential patient opportunity.
Based upon this analysis, we have prioritized the most promising assets in program optimizing the risk benefit reward balanced across our entire portfolio.
Examples of programs that will receive priority resourcing or a D V. B six a M b seven H for these.
These are 80 fused with large potential indication and global or near full global rights and economics that floating decision that could help transform our company.
Importantly, we remain focused on the combination of it don't Adcs and anti PD ones given the growing body of data demonstrating the clinical synergy through immunogenic cell death.
Such we have nine trials underway exploring this combination.
Our third strategic pillar is to advance innovative next generation ADC technology to empower our pipeline for years to come.
Several products utilizing our <unk> technology are now approved with many other pipeline assets in development.
We believe the ADC market, one time be measured in the tens of billions of dollars.
In parallel our teams are working on multiple waves of new ADC technologies that we believe will come to fruition are bearing time points.
For example, we're developing ADC is employing novel or a statin and camptothecin technologies as well as the adcs that incorporate new cytotoxic and immuno stimulatory payloads.
Further out we expect adcs to utilize novel drug conjugate technologies that employ other diverse mechanisms of action we.
We continue to invest in cutting edge technology to retain our leadership position and expand the number of approved adcs in order to reach more patients.
We remained selective and opportunistic and supplementing our pipeline with complementary external assets that could also have exciting potential.
With that I'll turn the call over to Chuck who will provide an update on our commercial performance then Todd will discuss our financial results in 'twenty two 'twenty three guidance after that Roger will detail, our clinical development activities and pipeline take it away chip.
Thank you David the commercial team delivered another strong quarter to close out a very successful year for C. J.
Performance in Q4, underscore our strong commercial execution across our portfolio.
Et cetera fourth quarter sales were a record $238 million.
And 35% increase over the fourth quarter of 2021.
Year over year growth reflects a return to pre COVID-19 diagnosis rates.
Favorable gross to nets.
And sharepoint gains in frontline Hodgkin lymphoma.
Et cetera is now in category, one preferred agent in E&C CN guidelines.
It has resulted in positive changes in treatment pathways and incremental share gains in the frontline setting.
We are pleased with the performance of etcetera, and we continue to see opportunities for incremental share gains in frontline <unk> in 2023.
As of fourth quarter sales were $122 million.
The 32% increase over the same quarter of last year.
These sales included clinical trial supply orders of $6 million for the quarter.
<unk> remains a U S standard of care in the second line setting.
Underlying growth was primarily driven by patient flow into the second line setting.
Due to continued use of checkpoint inhibitors as frontline therapy.
Meanwhile, our commercial teams are preparing for a potential launch into the frontline metastatic setting in combination with keytruda in cisplatin ineligible patients.
As a reminder, this is a sizable opportunity with approximately 20000 total addressable patients in the frontline metastatic setting in the U S.
Around 18000 of these patients our drug treated and approximately 50% are ineligible for cisplatin based chemotherapy.
If approved the paths of combination would represent an additional important new treatment option in the frontline setting.
Moving onto the Kaiser fourth quarter sales were $86 million.
Down 9% year over year.
We have established the cases market position as a valuable treatment option for patients in the second line plus setting, especially for those with active brain metastases.
<unk> continues to perform well despite ongoing competitive headwinds related to in her two's increased use in the second line plus setting we.
We expect to see stabilization of patient flow into the third line in the second half of this year.
<unk> performance continues to benefit from extended treatment duration of a year or longer in approximately a third of patients, which underscores its efficacy and tolerability.
After last month's FDA accelerated approval our commercial team has now launched in the second line plus setting in patients with her two positive metastatic colorectal cancer.
This represents the first approved her two directed therapy in this setting.
Although a modestly sized market of approximately <unk> patients. This population represents a high unmet medical need as existing approved colorectal cancer therapies typically offer limited response rates.
In addition, we estimate approximately half of colorectal cancer patients are currently screened for her to expression.
A focus of our commercial efforts will be on increasing patient screening rates.
Looking beyond the U S falling.
Following successful pricing negotiations in the fourth core we launched the Kaiser and Italy, and Norway and look forward to expanding access in the coming months.
Merck is progressing regulatory submissions and reimbursement activities intended to expand <unk> reach in their territory and have multiple launches planned this year.
And finally, <unk> sales were $18 million for the fourth quarter, an increase of 7% from the third quarter of 2022.
The CE Gen and Genmab commercial teams remain focused on ensuring positive treatment experiences and driving further market penetration of this important treatment option.
We also look forward to the outcome of the innovative 301 global Phase III trial later this year, which could result in full FDA approval, if it demonstrates an OS benefit and other endpoints, while potentially serving as the basis for global submissions.
With that I'll pass the call over to Todd who will discuss our financial performance.
Our outlook for 2023 Todd.
Great. Thanks, chip and thanks to everyone for joining us on the call our financial results reflect significant progress made across the business in the past year.
Hey, I'll summarize our 2022 financial performance and then discuss our 2023 guidance.
Total revenues were $528 million in the fourth quarter and $1 $96 billion for the full year in 2022, representing year over year growth of 23% and 25% respectively.
This included record net product sales of $464 million in the fourth quarter and $1 $7 billion for the full year, reflecting year over year growth of 26% and 23% respectively.
This growth was driven primarily by et cetera, and pads as well as contributions from the launch of <unk>.
Royalty revenues were $53 million in the fourth quarter and $165 million for the full year in 2022.
Full year royalty revenues increased 9% over 2021, driven by strong commercial performance by our partners, notably Takeda with its sales of et cetera, and Roche with its sales of policy.
Collaboration revenues were $11 million in the fourth quarter and $91 million for the full year in 2022.
These included royalties on sales of pad serves.
By Astellas in its territory as well as other collaboration revenues, including a new collaboration with XI lab in the third quarter.
Cost of sales was $108 million in the fourth quarter and $410 million for the full year in 2022. These.
These include product cost of sales and royalties for each of our four brands profit share amounts owed to our collaboration partners Astellas and Genmab as well as noncash amortization of acquired technology cost sports.
Yes.
R&D expenses were $358 million in the fourth quarter and $134 billion for the full year in 2022.
These reflect continued investments to expand the potential of our approved products into advance our pipeline programs.
SG&A expenses were $216 million in the fourth quarter and $821 million for the full year in 2022.
This was driven by ongoing commercialization efforts in the U S and Europe as well as other corporate activities to support our growing business.
Next I will turn to our financial outlook.
We expect total revenues in 2023 to be in the range of 2.14 to $2 two $4 billion representing growth of 9% to 14% over 2022.
Beginning this year, we are providing product sales guidance at a portfolio level. This reflects the expansion of our commercial portfolio to now four approved products and an increasing number of indications and expanding geographies. We will continue to report quarterly results at a brand level.
With that in mind looking across the portfolio. We are guiding to product sales of 1.925 to 2.0 billion, representing an increase of 13% to 17% over 2022.
We expect that sector's growth to be driven by continued use across seven indications most notably in frontline Hodgkin lymphoma, and we expect et cetera reached blockbuster status in our territories. This year for the first time.
<unk> serves as an important and established brand for the company. Our guidance today does not include contributions from the potential U S label expansion for pads of which has a <unk> action date of April 21.
We expect that et cetera, and peds will remain the largest contributors to our sales in 2023, and we look at the second half of 2022 as a good indicator of how each of our brands will perform going into 2023.
As a reminder, first quarter sales are typically the lowest of the quarters with growth seen throughout the year.
We are excited about the recent label expansion for to Kaiser into metastatic colorectal cancer patients while the label expansion takes us beyond breast cancer. It represents a relatively modest commercial opportunity.
From an overall brand perspective, while we expect contributions from colorectal cancer. We also expect continued headwinds from and hurt you in breast cancer in the near term and that will impact overall growth in 2023.
And finally, while we continue our efforts to drive <unk> growth in its current indication, which has become an important treatment option for women with advanced cervical cancer.
We continue to look for future growth opportunities for tip back through our basket trial efforts in other tissue factor expressing solid tumors and Roger will provide the development update later.
Next we expect royalty revenues to be in the range of $170 million to $185 million, primarily reflecting sales of et cetera by Takeda in its territory along with contributions from sales of pole D by Roche.
As a reminder, the Takeda royalty rate tiers reset at the beginning of each year.
Finally, we expect collaboration revenues to be in the range of 45 billion to $55 million, which includes pads have royalties from astellas as well as amounts earned from our other collaboration partners.
R&D expenses are expected to be in the range of 145 to $1.5 billion to $5 billion.
This reflects continued investment in clinical trials to further expand our commercial brands advance our earlier stage agents and drive our ADC innovation.
SG&A expenses are expected to being in the range of $880 million to $930 million focused on commercial execution to drive growth of our approved products and to support our overall growth strategy.
Cost of sales is expected to be in the range of $420 million to $470 million.
Growth over 2022 will be driven by increased product sales and higher profit share payments to our collaborators.
Noncash expenses are expected to be in the range of $330 million to $375 million. The majority of which is stock based compensation.
Taken together, our financial guidance reflects our strategy to support the growth of our current approved brands and fund the development of a growing pipeline.
Now I'll turn the call over to Roger for an overview of our research and development progress.
Roger.
Thank you Todd and good afternoon, everyone I'm happy to share our recent clinical development updates.
Both our approved medicines and our pipeline.
I will begin with ADCETRIS, which is the foundation of care in CD <unk> expressing lymphomas since our last call. We have achieved a number of important milestones.
In September the <unk> guidelines were updated.
Elevating the Chinchillas combination to a category one preferred treatment option for adults with previously untreated stage three or four Huntington lymphoma.
Based on the implant impressive overall survival data from the echelon one trial.
These data are currently under review by FDA for potential inclusion in the label.
In November ADCETRIS was approved by the SBA for pediatric patients two years and older with previously untreated high risk classical Hodgkin lymphoma in combination with standard chemotherapy based on the children's oncology Group study.
We continue to evaluate other potential indications for ADCETRIS, including D O PCL and solid tumors, the natural of which we expect to report data in the first half of this year.
Moving on to <unk>.
<unk> has been granted priority review with a producer date of April 'twenty, one 'twenty two 'twenty three for a supplemental BLA based primarily upon data from cohort K of the EV 103 trial.
As a reminder, this cohort study the safety and efficacy of pad said in combination with Keytruda in frontline cisplatin ineligible patients with unresectable locally advanced or metastatic <unk> cancer.
At ESMO, we presented data that showed the combination generation or are of 64, 5% median cycles of therapy of 11 months and then median duration of response that had not yet didn't reach.
This week at <unk> G U analyses evaluating the response of the pads at combination across different patient subgroups treated in EV 103 cohort K will be presented these data confirm the consistent benefit of pad saving keytruda amongst key patient populations, including low.
With liver metastases.
And low levels of PD lone expression.
Of note, we completed global enrollment of EV 302 in November of 2022, and estimate PFS topline data to be available by year's end.
An extension study in China continues to enroll.
This is a global study evaluating <unk> in combination with Keytruda in both CIS ineligible and CIS eligible patients, which is a broader frontline population.
Was enrolled in cohort K.
E V O. Two is intended to support submissions around the world, including in Europe , and Asia and is the confirmatory trial for a potential U S accelerated approval of pet food in the evening, one O three cohort K treatment session.
In muscle invasive bladder cancer, which is the stage earlier than metastatic disease. We continue to advance pads with two ongoing global phase III studies evaluating the combination with Keytruda getting peri operatively.
In non muscle invasive bladder cancer, which is the earliest disease stage. We are conducting a phase one study EV one O four with pad save given as into the secular therapy initial data may be presented later this year.
Beyond Eurotiales cancer together with Astellas. We are also considering as Pat said its potential in other Nixon for expressing solid tumors and we will be sharing initial data in the first half of this year.
Continuing with to Kaiser We recently received accelerated approval in combination with Trastuzumab for achievement of adult patients with previously treated metastatic colorectal cancer importantly, and CCN guidelines have been updated to include to Kaiser as achievement.
<unk> for patients with her two expression Ras wild type metastatic colorectal cancer.
Clinical situations outlined in the guidelines include a primary treatment option for patients who have received adjuvant false OXXO <unk> within the last 12 months, a first line treatment option for metastatic disease, where patients are ineligible for intensive chemotherapy and second line and beyond treatment option.
Patients who progress on any frontline chemotherapy.
A phase III trial has been initiated in frontline metastatic colorectal cancer, which is intended to serve as a confirmatory trial in the United States and support global submissions.
Moving to breast cancer her to climb owed to our phase III study of <unk> in combination with Ken Siler in metastatic second line plus patients completing enrollment in June of 2022 and top line data is anticipated in the first half of this year.
Ken Silo is an important treatment option for patients with her two positive metastatic breast cancer and if the trial is successful the combination of <unk> plus cats, either could provide an alternative Nate line option, including four patients with brain metastases.
Additionally for two kinds of we plan to present data in the first half of this year, if I'm a basket trial in combination with Trastuzumab in previously treated metastatic solid tumors alterations with a focus on biliary tract cancers.
I'll turn now to tip deck, which is approved in the United States for the treatment of patients with recurrent or metastatic cervical cancer with disease progression onto after chemotherapy.
Phase three trial in cervical cancer innovative 301 is close to completing global enrollment with a potential for topline data in the second half of this year.
This study is intended to serve as the confirmatory trial in the United States and to support global regulatory applications.
Cervical cancer, we continue to study the potential of <unk> in other malignancies through an ongoing phase II study innovative two O seven initial data with a modified dosing schedule in head and neck cancer is projected to be presented this year.
Continuing with the system abdomen or D. V. This her two directed ADC is being evaluated as monotherapy and in combination with Keytruda for the treatment of metastatic <unk> cancer in her two expressing tumors, we plan to initiate a phase III trial in frontline metastatic <unk>.
Cancer in combination with Keytruda later this year.
Additionally development activities are underway to evaluate <unk> as a monotherapy and in combination with <unk> or keytruda in her two low metastatic breast cancer and two that you're expressing gastric cancer.
Moving to our early stage pipeline, starting with SG and <unk>, a a wholly owned <unk> ADC targeting integrin beta six we reported phase one clinical data in November at City. In addition to a manageable and tolerable safety profile at the explode.
Those regimens the initial anti tumor activity observed in heavily pretreated patients with advanced solid tumors appears encouraging and has treated expansion cohorts in non small cell lung cancer head and neck cancer and esophageal cancer focusing on the lung cancer subset, we observed a study.
3% confirmed objective response rates.
Updating clinical data, including initial durability of response will be reported later this year.
Turning now to U S. G N b seven H for V. This is a novel Idose <unk> ADC targeting the immune checkpoint b seven edge full with potential opportunities in breast ovarian and endometrial cancer, we are making progress in the first in human trial and anticipate share.
During initial clinical data this year.
We continue to advance our R&D engine with Adcs and other targeted therapies for cancer and.
Partnership with Tennessee, we are planning a 2023 R&D submission for <unk> five targeted ADC with preclinical data supporting the submission to be presented at an upcoming medical meeting.
Further we are planning additional IND submissions with adcs utilizing novel drug linker and payload.
S. G M D b to H a co stimulatory Bispecific has recently achieved first patient enrolled in a phase one first in human trial, initially focused on relapsed or refractory metastatic melanoma SG.
S G N egfr or D to a preclinical bi specific targeting gamma Delta T cells in Egfr positive tumor cells is on track for an IND submission in 2023.
Over the course of this year, we look forward to achieving multiple important data and regulatory milestones encompassing our approved portfolio and our pipeline assets.
See Gen has now emerged as a company with the expertise capabilities and passion to discover develop manufacture and commercialize transformative medicine that impact lives.
We operate from a position of strength as we work to build <unk> into a leading global oncology company.
We will now turn to Q&A and to increase the chances of those participating on today's call have an opportunity to ask questions. We ask that you. Please limit yourself to one question each operator.
Yeah.
Ladies and gentlemen at this time, we'll begin the question and answer session.
To ask a question you May press Star and then one on a touchtone telephone.
All your questions you May press star two.
If you are using a speaker phone.
We do ask that you please pick up the handset prior to pressing the numbers to ensure the best sound quality.
Once again that is star and then one to ask a question.
We will pause momentarily to assemble the roster.
Yeah.
And our first question today comes from <unk>.
<unk> Richter from Goldman Sachs. Please go ahead with your question.
Good afternoon, Thanks for taking my question.
Non muscle invasive bladder cancer data set that's reading out for pad seven first half can you help us one understand then the mechanistic rationale or should we think about the drug working in metastatic bladder.
We have working in this tumor type.
And then two what the bar.
The bar would be for this to be positive and then just remind us when the muscle invasive bladder cancer data will be.
Presented.
Ana it's David Thanks for the Great question, John as you know over.
I'm pretty excited about the franchise, we're building in bladder cancer and the strategy.
Pat.
It is increasingly into earlier lines of therapy.
We're going to further build upon that.
Bladder cancer presence by eventually introducing D.
D V also Nevada, and some of our direct return to her two positive patients.
You're right to focus on both muscle and.
Muscle invasive bladder cancer.
Sure so much bigger.
Therefore, our current approval is hey, Roger I think it would be best if you.
Sure some insights on that program shortly.
Thank you.
So <unk>, it's a great question and frankly speaking the profile the potential profile of <unk> given into the bladder.
It could be an excellent one for the following reasons.
Firstly next employs express stably across all of the disease state. So we have as much nation for expression in its very early superficial bladder cancer patient population as we would have in metastatic disease.
Secondly, when we instill pads it in its current formulation into the bladder we.
We saw this both pre clinically and of course, we'll share some data clinically than we were able but we had no preclinical systemic exposure. So the profile the tolerability and safety profile of those pads. It may look a little bit more favorable potentially then with systemic administration. Secondly, we showed in the <unk> or the topic.
Cancer model that we could in fact by giving headset into the bladder is sort of in direct contact with the tumor impact and has an anti tumor effect. So I think we're up we're optimistic we're excited actually about the opportunity and obviously, we'll be sharing that information such as we have.
Later in the year, we are starting in the place where almost everyone does begin which is with the BCG unresponsive population. So these are folks who have failed standard therapy in terms of what could a registration path look like what could the hurdle look like I think that has already been defined for that population.
And there is some FDA guidance with regard to what type of endpoints things like complete complete response rates.
With Cif type disease.
But we're still we're still in the expulsion phase.
But we do see we can see a path forward for the BCG unresponsive and frankly for a broader population as well as there are other drugs that are being developed in this space.
Great.
Good question.
Our next question comes from Matthew Harrison from Morgan Stanley . Please go ahead with your question.
Okay.
Great. Good afternoon. Thanks for taking the question I was just wondering I know obviously guidance doesn't include the potential impact from cohort K, but I was wondering if you could just provide maybe some.
Roger commentary on how you think about the ramp if you are to receive accelerated approval in that setting.
And any factors that you think could influence the trajectory in the second half of this year. Thanks.
Hey.
No. Thanks for mentioning that our guidance does not include.
Okay.
2023, I just want to say the review is going well.
And I think.
Once we have the guidance and we see the label, we will be able to update people and it's likely to be pretty meaningful in terms of incremental sales during the course of the year.
I think I'm going to turn it over to chip now if you can give any color.
Uptake without going to too much specifics, but I think we're going to hold a lot of that because we see the final label.
Yeah sure. Thanks, David So I would have just a couple of comments, we have an established presence in this marketplace.
In the second line setting pads that is now the standard of care. So we we have good insight into this in this space.
And have the capability of continuing to.
Grow the brand into the frontline setting.
The market itself is substantially larger than the current label that we have in fact, it would probably be the largest commercial label that we would have similar label, we would have to date.
If you look at it by the numbers, it's about 20000 patients with about 18000 of those drug treated and about half of those which are cisplatin ineligible and so this is a real meaningful opportunity for the teams.
Our next question comes from Jessica Fye from JP Morgan. Please go ahead with your question.
Great. Good afternoon, Thanks for taking my question.
Or pads can you talk about how much growth you see.
Remaining in the U S.
<unk> approved indications recognized it you're obviously embedding.
Growth for the product this year, but I guess I'm talking about ultimately how closer are you to fully penetrating that opportunity.
<unk>.
Thanks Jess.
We will continue to grow in the existing indications, albeit at a slower rate.
The big opportunities are going to be moving up into earlier lines of therapy.
Okay.
Yeah.
Our next question comes from Jay Olson from Oppenheimer. Please go ahead with your question.
Oh, Hey, thanks for taking the question, maybe I'll shift gears over to her two positive breast cancer can you just talk about your latest thoughts on that.
<unk> landscape, especially with regards to.
And her to and also how do you expect easy to differentiate.
Hum too as well.
And then also maybe.
Any perspective on.
In terms of the competitive landscape. Thank you.
Hey, Jay it's David so.
I'll give some introductory color than I'm going to ask Roger.
Just to add to that.
Clearly the breast cancer market is pretty dynamic right now the introduction I Havent heard tuition is a very good drug has shaken things up a bit and people seem to get durable responses on that medicine.
And it causes drug developers I think carefully about.
How they would bring.
Or perhaps even better.
Roger.
Into that marketplace.
And Acacia and Acacia D V. My initial thinking of Roger will add more.
The opportunity to come in.
Behind her too.
Largely because we have a different payload in a very very good track.
As you know in breast cancer patients, who will go through multiple lines of therapy.
During the course of their training.
In the case of Chicago.
Where we're differentiated as a small molecule.
We have really good data and benefit in patients.
With brain metastases.
Our strategy there is to combine to zoom and other drugs, we havent trial underway, which will report out and then not too distant future.
Turning to cash.
Siler had five on that will then expand perhaps roughly double.
The patient population that would be awesome.
Is that kind of pilot containing regimen.
Two guys.
As currently a brain Mets drug.
Hi, I'm being used.
Really permits formats now a doctor to use a combination to treat that.
That entire.
Set of patients, but that gives you just some color is one of the more difficult markets are forecast at the moment.
But we can talk more about that Roger do you want to add anything about.
And from a clinical standpoint.
I would just add David I think again, you're agreeing with your statements and Hershey was a great drug it's making a difference it's actually defined population in breast cancer that is sort of previously not defined which is too low population.
Where we're excited about about D V and having that defined population are ahead of us we see an opportunity once patients.
Have gone to a sort of chemotherapy based type of therapy.
I think we see any difficulty with physicians and patients accepting that.
Could go from one ADC to another as you point out there are there are different payloads and we have a different antibody houses not trastuzumab.
The project antibody directed against <unk>. So we're still working on those development plans and I would also point out that we believe is pretty strongly one of the.
Hallmarks, perhaps of a dozen based ADC is in the context of an immunotherapy like a PD one inhibitor.
We believe we may potentially have a leg up where that combination as you can see with our pets is keytruda data really has an impactful outcome and so any development plans, we think about for TV, we think about the possibility of combining with the PD one inhibitor and as you mentioned, we have two cabinet as well and so.
Finding those assets are also in.
Plans.
Great. Thank you very much.
Our next question comes from Stephen Willey from Stifel. Please go ahead with your question.
Yes, thanks for taking the question.
I guess just on <unk> I know that Youre talking to an update in the first half of this year. I think you are kind of emphasizing durability of responses that have been observed to date, but should we expect any additional dose expansion data along with that update and to what extent does the dose that you've selected for dose expansion in head and neck inform the dose and schedule that you want to take form.
Until one thanks.
Okay.
Steve Let me start and then I'll ask Roger.
More specifically to answer your question.
I just say.
We have a lot of experience in this company.
Agencies, though.
When we see early data across different dosing cohorts in that disease.
Could you give me the top hole.
But a pretty good read on where our product is likely to go on let me just state piece.
Six eight ish is shaping up to become a transformative asset.
For this company.
Very excited about it.
There will be a jagged cuts later this year, which won't be sharing.
Roger.
Any more thoughts so it's a great question and obviously I think we will.
We'll hold the details until we.
Get to present, but what I would say in general.
Is that we will land on one dose and scheduled regardless of the disease. So.
The the the cross information or the flow of information from one expansion cohort to the other is a coordinated event in terms of us trying to land on what we consider to be an optimized dosing schedule is as David said.
We look forward to sharing durability data and its potential for the data cuts in the year as well.
Okay.
Our next question comes from Geoff Meacham from Bank of America. Please go ahead with your question.
And.
Good afternoon. This is how kearney meaningful Kathleen. Thank you for the question. So I'm. So sorry sink my question is related to ADCETRIS I'm still again, a very strong quarter I think exciting about our pride Colgate and.
Penetration that's a momentum there just wanted to get a sense about how that you see in 2023 do you see that kind of trend to continue in 2023.
Hi, Howard Scott It's David.
Let me just say and.
Todd's commentary, we mentioned that.
This product will become a blockbuster in our territories such as the U S.
Canada.
Typically when brands start to accelerate because of new labels or new guidelines and.
They maintain that acceleration for a period of time.
That's our thinking about 'twenty three.
Another strong year for the brand.
Our next question comes from Gregory <unk> from RBC capital markets. Please go ahead with your question.
Great.
Thank you very much for taking my question and congrats on the quarter and the progress so far.
David and team just maybe a question and a request for you renewed thoughts on on really the path to profitability just curious as you have prioritized.
Certainly the pipeline programs and doubling down on the.
The commercial portfolio, how you think about the investment that.
That youre committing to and just that that ramp there as it relates to looking at these early programs that that you believe have that Oh.
High probability or a better probability of success as it pertains to you I'm looking at profitability. Thanks, So much yes, I'll start and then Todd Hall.
Follow up.
The short answer is.
And the J P Morgan Healthcare conference and again in this call.
Highlighting three.
Although our near called White Hall assets, each of which can be a blockbuster and just to put that into context for you.
Non small cell lung cancer for beef.
The market.
Call. It six times the size in terms of IP in the first line.
Bladder cancer market. So we're talking about really tremendous opportunities for our company. So the way I think about these things as our first priority is to invest adequately.
In terms of having perhaps pivotal trials necessary to capture those huge upsides obviously.
We're very thoughtful about how we spend our cash.
Balance sheet is strong.
And.
When we do get some profitability.
I would suspect it's not going to be.
Minor profits would be no.
Does that really matter.
Yeah.
Anything you'd want to add just one thing thanks, Craig for the question.
This is first of all a question that we've gotten for a long time.
Good question Thats, one we start.
I think our strategy continues to be investing in our portfolio of our platforms to bring more meaningful drugs to patients in need and I think if you just look at last year's print.
Revenues were up about 25% for the quarter and the year. When you look at the 23 guide even excluding cohort K, we're up about 15% and this brings our total revenues to two and a quarter billion just about so I think that's an illustration of how successful we think the strat.
<unk> has been.
With that in mind, we've got an amazingly broad and deep pipeline to continue investing in.
<unk> heard a little bit on the call today about programs like <unk> in PV and <unk>. These are drugs that.
Address meaningful solid tumor populations and their assets that for all intents and purposes are wholly owned by <unk>. So we think those are the types of assets that make a lot of sense for us to invest in and investing heavily to really continue to drive.
The growth and the success that we've had today.
I think just to add to that and.
The other way I think what Todd just told you was we could get profitable pretty soon if we wanted to but we would be cutting off our future, which is much more exciting than where we are today.
Great.
That's great. Thanks, guys.
<unk>.
Our next question comes from Michael Schmidt from Guggenheim Securities. Please go ahead with your question.
Hi, Good afternoon. This is ebay on for Michael Thanks for taking my questions.
One question on <unk> you previously reported median treatment duration of 11 cycles for pets that Keytruda combo cohort K.
Is that a good modeling assumption for passive duration first line CIS ineligible patients.
Clinical practice post approval.
We are nearing the Paducah date in April and how could this number still change with longer follow up.
We're still roughly one third of the patients still on treatment by that last bit of color. Thank you.
Okay.
Yes. So we are very excited about this.
Coming.
Decision in April .
I'm going to ask chip to try to give you a little.
A little bit of thinking about.
How long, we think patients might be on therapy.
One thing I would say to you is is that it will be on therapy longer in the frontline setting.
Second line setting in part because these.
These patients are generally healthier.
Heartbeat clause.
This density is probably a little bit less at all toll patient should should do better when this drug is combined.
With Keytruda given given the synergies that we see in between.
P D wise.
Chip any any more thinking you'd want to add.
Yes, sure David I think it's just important to note we don't have a label yet so certain details on this can change.
But our general thinking with regard to the clinical trial experience. We have is that we would expect to see a longer duration than what we do in second line.
The duration and frontline, we think is going to be somewhere closer to seven months.
As David mentioned, it's a little bit less of a dose dense regimen on a monthly basis.
And the patients are also generally speaking a little bit fitter. So.
So we think that's kind of what we're looking towards.
Great. Thank you very much.
Our next question comes from Andy Shay from William Blair. Please go ahead with your question.
Okay, great. Thanks for taking my question and David Congrats on Great to hear from you. So I am just curious about the biology and underlying clinical characteristics of first line.
Eligible patients versus let's say second or third line as you enrolled in the EV 301 study or the initial accelerated approval I'm. Just curious is it beyond the realm of possibility to recede a broad label as the FDA reviews, the pads have been frontline E C.
Okay.
Okay.
So I am going to.
Roger.
Let me just say ex U.
A nice opening their complement let me just say that.
I'm really happy to be at CJ.
About three months and right now I'm, even more bullish on the future of this company and you heard some of that in the call.
Strong NOI growth.
Shaping up to be a transformative asset leading position in bladder.
And although we havent been asked yet we havent discovery team.
Right.
File this year R&D Camden.
This company's Julien.
After your specific question Roger what do you think.
Hey, Andy Thanks, It's an interesting question I think.
Our view is.
Essentially we get we get we hope we get what we ask for as David said the review is going well. The population is well defined assistant eligible based on characteristics of things like renal dysfunction in.
In hearing loss and we have right behind it.
EV 302, which we have signaled we may well have topline.
Data sometime in this year towards the end of the year, perhaps and so I think although it would be fantastic I think it would be very unlikely my personal view is if we're successful.
The likely outcome is the labor will reflect the population, we studied which assists in eligible patients.
Got it very helpful. Thank you.
Okay.
Our next question comes from Joe.
Patent Zoro from Piper Sandler. Please go ahead with your question Hey.
Hey, guys. Thanks for taking my question and congrats on the progress. So Roger you just mentioned EV 302 with with enrollment now complete I was wondering if you had any visibility into the extent of the Taliban maintenance usage in the control arm and how you think about how that may impact the potential performance of the control arm in that study.
Project Yup sure. Thanks, Thanks, Joe for the question.
So just to give you a little bit of history, if you recall.
A venue Mab went through its approval process.
As we were rolling out.
EV 302.
And it is obviously part of the care of patients with with frontline disease provided.
They have.
Our response to complete response partial response or disease.
Disease control meaningful disease control and so the population that actually gets a indianapolis relatively restricted compared to the population that we're looking at on EV 302. Nonetheless, they will be used I can share with you what that level will be it is a global trial. So <unk> has been conducted around the world.
And physicians on the control arm consider that that iridium app should be useful in that likely will happen. So.
I can say there is a L. M abuse I just can't give you any more detail as to how much with regard to the outcome I mean, obviously the trial itself will demonstrate in the in what the value in terms of things like overall survival and progression free survival is with <unk> and Keytruda I would remind you we have.
Done although they are single arm experiments, we have we have done two experiments through the form of code a and cohort K.
In a population of CIS and eligible patients that are generally perhaps not as well as an older than <unk>.
Patent eligible patients and the survival curves they've generated there from there give us optimism and confidence that if we repeat that type of outcome in the context of a broad global trial, which includes all of these different populations and a degree of available use I.
I mean again, we have where we are.
To mistake, we're excited about the combination until the trial reads out I can tell you what the results will be.
But I think we have a good shot at a positive outcome.
Okay, Great that's helpful and thanks for taking my question.
Our next question comes from Andrew.
Burns from SBB Securities. Please go ahead with your question.
Hi, Thanks for squeezing me in and congrats on the quarter.
I know you were unable to promote first line.
Some of them until you get a label or I'm, just wondering if you're already seeing some usage following the presentation of the data.
Some of them are a doc checks.
They're already using the first lot already.
And then I just was wondering if you could you mentioned developing some novel ADC technologies wondering if you could let us keep under the covers and see.
Can you give us some idea of what Youre looking at.
So first I'll just ask ship.
So whether or not.
Pass that maybe already used in first line bladder cancer study.
Yeah, so that would be organic we don't promote to that obviously, but there has been a little bit but not much.
<unk> right now.
And then you asked for you here a little bit more about our discovery efforts at Jpmorgan, we talked about multiple waves of.
Therapies and technologies.
I would say purposely superficial.
All right.
Too much away.
I indicated that one of my answers already earlier today that we are filing our first.
Kimco base.
So thats certainly one area.
Near term we have a.
A number of other.
Proprietary.
That we think will be particularly suitable for our our current.
Technology.
And then I'll go a little further into it.
We are now working on what we believe to be better anchors as well as <unk>.
Modes that are quite different from anything you've seen.
So far this is quite an expertise into our discovery group.
Roger as you know recently became head of R&D, and we're working to prioritize where we focus.
There's actually many many opportunities.
Going through the process.
Sure Jamie.
This which we will heavy up on their resources to get them into the clinic.
Great I appreciate it.
That's again.
Thanks, Jamie I think we have time for one maybe one more question alright.
Operator.
Our next question comes from Dane Leone from Raymond James. Please go ahead with your question.
Hi, Thank you for taking my questions and congratulations on the update.
One for me if you will with regards to the readout that we could expect a FERC climb to climb out to you.
You know what's interesting is it's obviously a larger study well.
Well control just tease out a signal of the benefit of cotton had with Trastuzumab advertising.
And the question that I think a lot of people have is what are the actual expectation statistically that your teams put in place.
To tease out a PFS signal and in this study and is your expectation that that PFS benefit.
Would come primarily from <unk> to cat <unk> ability to address brain Mets and progression on intracranial disease or is your team ultimately looking for a bigger PFS hurt all more broadly from the synergy of the two agents. Thank you.
Hey, Roger do you want to start on that one that's an interesting question.
Just to just to remind you was sort of set the scene for you on Hoochie klema to it has the same essential design elements.
And so to climb.
And importantly for this population obviously kept side there was a well known drug that is used in second line.
Plus and as David said.
On metastatic disease, but as we did with her to climb the eligibility criteria allow patients with brain Mets are the control or active and so we expect to have a meaningful number of patients with brain metastases in her to climb obviously as we did in in hope to Oklahoma too.
As we did in her climb with regard to assumptions around treatment effect just to remind you again of the design. This is a simple add on design. So this is the addition of two cat.
<unk> silo, and so any any benefits that you're casting a cruise I think will be pretty evident I can't share with you specific assumptions, but we are looking for all of the above if you mentioned how are we looking for chicken to fix.
<unk> population, yes are we looking for meaningful treatment effect in a in a subset of patients with brain metastases. The answer is yes.
And I think we see the potential.
Four to captain of instead of being.
In all decisions.
Physicians try it.
Trial is positive and the results are meaningful.
Physicians will end patients be able to make the decision if Kevin Tyler as part of the treatment plan.
Add to cabinets of that combination.
Great. Thanks, Roger Let me just conclude by saying this is going to be.
Very exciting year for us.
The data and regulatory milestones.
I'm thrilled to be here and thank you for all the attention you are paying for our company that will close the call.
Ladies and gentlemen, with that we'll conclude today's conference call and presentation. We do thank you for joining you may now disconnect your lines.