Q3 2023 Roivant Sciences Ltd Earnings Call
Good day, and thank you for standing by welcome to the ROI that quarter.
Quarter 2022 earnings call at this time, all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During this session you will need to press star one one on your telephone.
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Withdraw your question. Please press star one one again please be advised that today's conference is being recorded I would now like to hand, the conference over to your speaker today, Stephanie Lee. Please go ahead.
Thank you good morning, and thank you for joining today's call to discuss fragrance financial results for the quarter.
And then December 31 2000.
Presenting today, we have Matt Klein, our Chief Executive Officer, and then filing and via conference call. You can find the slides being presented today as well as the press.
The release announcing these results on our IR website at Www investor.
Well also be providing the current slide numbers you see for that.
L B.
I'd like to remind you that I'll be making certain forward looking statements.
They reflect our current views and expectations, including those related to our financial Department Central apps.
Yes.
Certainly encourage you to review the information that we filed with SEC, including the earnings release and Form 10-Q for more information.
Formation regarding these forward looking statements.
And related right.
We won't begin with Mac line haul revenue EBIT and.
To provide a financial update.
Well end the call with a Q&A session.
I'll turn it over to Matt.
Thank you Scott and thank you everybody for joining this morning.
I'm pleased to present, our third fiscal quarter financial results for the quarter ended December 31 2022.
Yeah. Thank you I am excited to be able to get together this will be a relatively shorter update because frankly, we had a very busy quarter and so we've taken a few opportunities to get together, it's hard to tell.
But actually it was after we last had a quarterly update call that we in licensed and then published data ports.
<unk> 31 to one as well.
We announced certain of our fiscal results last week and we did.
Financing.
A few weeks ago. Okay. Thank you everybody and looking forward to hearing from a basin in particular had some interesting updates to share around the commercial launch camel Jimmy.
I'm going to start out I guess quickly on slide by reminding everybody because it's still early in 2023, we are very excited about this year.
The year started off strong for us with the announcement of our RMB three 101 data the data for our anti PD one antibody from the induction phase of our ongoing phase <unk> study.
A number of really important updates from across the business, including we'll talk more literally today.
Continued reach and payer coverage of the camera, which we expect over time to translate over the course of this year into continuum.
Net yields and scripts.
We can now say both via during one an enduring to atopic dermatitis studies are fully enrolled and we expect to share top line data from both studies from the during two in March of 2023.
During one in May of 2023, so important data from our <unk> program coming very soon.
Because it opens up a market, we'll talk a little bit more about this four times the size of the.
A market, where we are currently in psoriasis.
We expect data in the first half break closer to the middle of the year to the beginning.
<unk> thousand 101 or into Q1 antibody from the chronic dosing period of that trial. The 52 week data, which we think is important data we will be the first time anyone's reported meaningful 52 week data for any Q&A antibody. So we're looking forward to sharing that full data set when it's available.
In the middle of this year as I know many many are watching we will have human data from our next generation <unk> antibody.
Two.
Which will discuss will leave us with.
The best MTF CRM franchise in the category. It was essentially the best with two drugs bulk with maximal suppression of ITG.
As well as working with new.
Potentially no impact on albumin or LVL and then finally, among the major announcements in the fourth quarter of this year, we expect to produce pivotal data.
From one or two potential pivotal studies.
And Brett <unk>, our dual inhibitor of <unk> and JAK, one we've really got the potential to be some of the best data as we've talked about what.
What we've seen in SMA, so excited to share that data and we got it.
So.
With that I'm going to start today with an update on the commercial launch of the camera.
We continued to be just incredibly excited for and I'll start on seven with just a brief review of the financials and some of this as I mentioned, we disclosed last week.
A near doubling of revenue for the quarter with revenues now at $9 $2 million in our second quarter, one and one thing I'm, particularly happy to report we've seen already early improvements in our gross to net yield from 12% in quarter, one up to 18% in the quarter just ended.
And I think we'll talk about payer updates in a moment I think the continued payer updates.
I could see that number.
Over time here.
Really happy with the continued level of patient and physician demand for the product we continue to get great feedback at more or less across the board.
<unk> really had as youll see a positive impact on our ongoing payer conversation so yes.
Excited about how that launch is going in Europe .
Can you hear updates as we get into.
The calendar year.
On slide eight we continue to B b.
Number one branded comparable we have been since our eight week of launch.
Japanese around the holidays, we're excited to see scripts returned to growth.
Our optimistic for the trajectory from here as we look forward.
Really excited with what the script volume.
Ah patient and Doctor Bvs in payer enthusiasm.
But perhaps equally and I showed the slide pretty often in slide 19, because I think it's a great slides. This is really just the beginning for US right in the most recent disclosed item at recent disclosed IMS week, we did about 3800 scripts.
Which is.
A great number for this stage of our launch remember that even in psoriasis alone. There are 90000 topical prescriptions every every week of which the vast majority of our topical steroids.
Once we get to recap Mcdermott type of statement had access to that patient population. There are well over 300000 atopic dermatitis prescriptions every week again, the vast majority of which are topical steroids and in psoriasis or data conclusively and argue establishes us as bolt.
More efficacious with a limited benefit.
<unk> topical corticosteroids as well as meaningfully safer and better tolerated.
Looking forward to sharing that broke down the capex number I guess I'm looking forward to continuing to push the dials and levers that will allow us to grow into those very very large opportunities.
It's been a.
A quarter of solid execution for the <unk> team.
I mentioned before both atopic dermatitis trials in one site and are fully enrolled.
Again, those readouts expected the first one during two expected in March three.
One expected in May so so important clinical data coming.
Can you expand high quality formulary access and maybe.
I had an update on that on slides 11, and 12, you'll first of all I am pleased to say at this point.
7% of commercial lives covered for the camera.
Close to 95 million lives that includes in addition to the National Pbms Formulary National Health plans original PVM formulary.
Eight Blue Cross Blue Shield plans.
Uh huh.
One national Pbms actually listed its new to market blocks are ahead of our review so that we have a good coverage across those lines.
These in many cases are decisions being led by the medical teams at these payors, who are so enthusiastic about the medical profile of the camera and what it offers to patients that were making.
Really really good progress on coverage.
A couple of examples on slide 12, I think sort of drive home the point around quality of coverage and I'd say the multiple factors have driven this progress, including a ton of patient and physician demand.
Payer judgment as I mentioned in the medical teams on fundamental clinical value.
Overall prescription value with volumes a lot of hard work.
From our team some representative examples.
One of the major pbms lifted the new to market block and required only a single step edit through a topical or vitamin D.
Another major Pbms editors.
Editors to formulary and requires a step through to either capital steroid vitamin D or combination.
Regional Pbms is added to the camera with no restrictions edits or steps at all.
Sort of on parity with generic steroids to National Health plans cover Campbell with the staff through any one.
Any two of the foremost counted therapies.
Many regional plans cover be camera is completely unrestricted.
With a simple steroid look back and I'll add and this is a small plan a small regional plans so far but there is one small regional players that actually covers US ahead of other recently launched branded topical competitors and then just as a preferred products.
The last thing I'll say about.
How pleased we are around the payer discussions here is we're really not only are we happy with the coverage overall, we are consistently covered at parity or better than.
Our typical competitors and that's important because youll remember there was a fair amount of discussion early on around different pricing strategies and the question around which pricing strategy was going to drive better access and we are now very happy to report that our pricing strategy and market access strategy has achieved really high quality coverage and we are definitely plan by plan PVM by PVM at no disadvantage.
On pages are at an advantage overall, so really really happy with the payer progress here.
As far as how this progresses some of our competitors have shown good progress in analogous indications from DTE and yield perspective over time I expect to show the same candidly the first quarter of the calendar year or sometimes a little bit more difficult because of the deductible resets.
So I think youll start to see more progress coming second quarter and beyond.
Really excited for those developments and things that we're going to head towards an attractive commercial P&L as we've said before and I can now backed that up with.
Broad coverage and an understanding of the economics of those contracts.
I'll stop there on the camera, but I'm sure I'll get some questions on the Q&A and move onto clinical execution.
First of all just as a high level sort of observation on slide 14, we are.
Really excited about the inflammation and immunology franchise. We're building here, we didn't set out to build.
<unk> company and in fact, we have a number of interesting opportunities that Dolby on.
But at this point we have.
Multiple new approvals and.
10, more than 10 phase III data readouts coming each year.
<unk> data readouts, including Readouts, Registrational readouts coming each year between now and 2025, so massive progress over the next couple of years, obviously, we've talked a lot about the clinical data earlier.
That lease from 2025 beyond two a wave of potential additional approvals across large ini indications with high unmet need.
Think building towards an ini franchise that has $15 billion or more in aggregate peak revenue potential. So just a huge opportunity for us and remember this is Stan <unk>.
T O N E and Arctic two one franchise as well as the hammer and other programs behind that so we think this is one of the most exciting biotech client franchises and we're excited to build this forward and we're excited to.
To see lots of interest from many different quarters and what we're building here.
You can see the late stage pipeline on slide 15.
We are familiar and have discussed many of these programs before I will talk about the camera earlier today, we'll talk about RMB 301 is a review of that data in a second I'm not going to spend too much time beyond that in the portfolio today, but I will say, we're excited for all the updates coming this year and looking forward to hearing them as the communities.
Unprecedented at least away from the numbers and the amount of high quality clinical data.
And moving for us.
What I am going to do briefly and I know many of you have heard the support of a scenario that's been post the Washington.
We're proud of and I'm not going to review the data for <unk> hundred one our anti <unk> antibody.
Because it's actually it's hard to believe that we first put it out only a little bit over a month ago and so it's still it's still new to us and still new to our story. So as a reminder, RG 101 is a phase III ready NTT <unk> antibody.
Which we are currently developing for ulcerative colitis, and Crohn's disease and plan to develop it in other indications.
This class and our agent and specific <unk>.
Delivered some data that we are really excited about it its extraordinary data at some of the highest end efficacy in an all comers population that we were statistically meaningful with meaningful clinical benefits clinically meaningful benefit across all the doses doses we tested.
Further we are able to enrich response rates in a prospectively defined biomarker subset remember that our.
Our partner Pfizer had run a phase III study that had explored different biomarkers and prospectively identify a specific biomarker was able to use a lot of data or optimize discharge the biomarker.
Which cover 60% of the UC patient population.
And overall, we had a great safety and Tolerability profile as well.
<unk> should be.
The first in class agent potentially.
In that in large and well validated markets. This was one of the largest phase III studies ever run.
In ulcerative colitis, we have 300 patients dose between basically study and our phase II phase III study.
And we have an important near term catalysts that I mentioned before our phase III data coming in the first half of this year for the chronic dosing phase.
Yes, <unk> on slide 17, as a reminder.
Really cool mechanism, that's got a pretty different motive operation, where it sort of a signal amplifier, where a whole bunch of different important pro inflammatory and fibrotic cytokines.
It's got to start multiple mechanisms of action across that pipeline would impact on these different parts of the.
So having for it that way, which frankly supports a little bit of Mr quality of the clinical data and the unique quality of the clinical data, we've seen as well as the safety profile and given the quality of our data and you see encourage us some real blue Sky thinking.
That with opportunities are well beyond UC and crohn's into multiple inflammatory diseases as well as other fibrotic disease ethanol fibrosis pulmonary fibrosis liver fibrosis and as a reminder.
And their phase Iia publications showed a meaningful impact on fibrotic markers associated with the guidance.
And so I'm going to remind everyone of the data on slides 18, and 19 starting with.
Incredibly compelling activity both for our agent and supported by data from a competitor across the last year.
Against some of the best gross efficacy seen in the best placebo adjusted Delta seen across any class.
We showed a 31% gross clinical remission rate or 20% people adjust the delta.
All comers at our expected phase III dose for a 40% gross efficacy with a 30% placebo adjusted Delta in that biomarker populations, great data on endoscopic improvement as well and then one of the datasets that we are most excited about on slide 19 is that we were able to preserve that efficacy.
Biologics experienced patient population with our biomarker, which is always a very difficult population. Most other classes of drugs fall over or have significant degradation of efficacy once again to that patient population placebo population is no longer respond in second line and this is in many cases, where patients multiple second line therapies.
This is due to a sick patient population. This data opens us up to some really extraordinary possibilities, including given the breath of our biomarker and opportunity to become a real second line agent of choice.
We're going to develop the drug for all comers, we're going to see nothing from a label perspective, but we are excited for an opportunity to develop this to help patients with a biomarker.
Second one database and all of this coupled on slide 20 with.
We just have a really remarkably clean safety profile with almost every category being frankly less than placebo or certainly placebo like.
Both the pool and our expected phase III dose. So you can see.
There are a lot of data we've talked about it before so I'm not going to talk about it now allows them to take questions on it we continue to be confident about the <unk>.
That that profile will hold up both based on the preliminary interim analysis and maintenance data, we've seen as well as looking at the relationship between the diversity in our safety and efficacy and we seem to be single relationship there.
And so with that I'm going to end the clinical and business update portion of this we're not going to talk more about other programs today I'm just going to give a refinance all things and then we'll open the line to Q&A.
So.
Yes.
Good quarter financially as we discussed we had adjusted R&D expense non-GAAP of $117 million or GAAP R&D expense of $1 6 million.
SG&A expense again, adjusted <unk> of $116 million or or gap of $168 million, notably the majority of that SG&A expense comes from Zelman <unk> associates associated with the launch of the camera.
And then we have a very strong cash position that we continue to develop but we ended the quarter with balance sheet cash cash equivalents of $1 5 billion or about $1 9 billion, giving it back to the financing we did two weeks ago as well as expected receipt of proceeds from the sale of the Miami minority Sumitomo pharma, which we expect to complete this quarter.
That gives us as we discuss the board cash runway into the second half of 2025.
We're producing a tremendous amount of important clinical data during that period across all of the programs that just mentioned the financing we did a couple of weeks ago.
Makes us.
Gives us the ability to run full speed at 31 O one including across multiple clinical programs on comfort, we will produce some important data for.
<unk> thousand <unk> hundred one over the other program during that window. So.
What the board hearing those updates.
Bill.
With the financial position that we're in.
I'm proud of all the work the team has done over the last quarter and looking forward to taking your questions and continuing to provide obviously a bunch of updates between now and when we file our 10-K later this year. So thank you everybody. Thanks for your time this morning and to that after the recession I'll turn it over to the operator to go to Q&A.
As a reminder to ask a question. Please press star one on your telephone.
For your name to be announced to withdraw your question. Please press star one again.
Please standby, while we compile the Q&A roster.
Our first question comes from Brian Cheng with JP Morgan. Your line is now open.
Hey, guys. Thanks for taking my question this morning.
So we're looking to doing two readout next months, what should we expect there in terms of efficacy of topline and what do you think that will need to see to be commercially viable.
Thanks, Brian I appreciate the question I appreciate you listening. This morning, so thank you.
<unk>.
What should we expect to see a top line and Thats always a good question, we have not yet seen the data or phase two b data was was really compelling as you may know, we showed 49% gross efficacy in an Iga responder rate.
At our eight week endpoint.
I would say yes.
There's a pretty wide range of what good could look like in that study, but I would say if we're in the.
In the <unk> from a gross perspective, that's a grand Slam for us.
We are in the mid to high <unk> I would say, it's a solid homerun and I'd say anything in the thirties up would be commercially viable for our products given the quality of our data the quality of our competitors' data the quality of our safety data et cetera. So I'd say stay tuned for what the actual data look like.
Feeling excited about about the opportunity.
A broad range of data that could be sort of commercially promising.
Great and maybe just one on <unk>.
We've talked previously about the potential for.
Our DTC campaign I'm just curious what's your latest thought on that.
The timing or the need to launch a DTC campaign here based on the trajectory that you see.
How important is that.
Based on where you stand in terms of uptake.
Are there any pockets of opportunities.
But you haven't.
To add fully tapped in yet for the hotel not launch thank you.
Yes, Thanks, Thats a great question.
I'll give an answer and then Frank CFS anything to add.
Look I think first of all we have some DTC efforts ongoing already they are highly targeted and specific markets or using social media.
We are.
We're excited about what we've been able to show there, but it's really the earliest days in terms of DTC strategy and we haven't pulled out.
We're near to the level of stops that we could.
To make this a thing.
For us we've been relatively conservative here because.
It makes sense to drive DTC volume only as payer coverage really ramps up sort of the patients who are sort of.
Finding out about the drug are eligible for coverage when they go to their doctors so.
But we're still planning for that obviously are sort of patient model is different than some of the systemic therapies that advertise.
Very aggressively, but I think youll continue to see us being thoughtful and used targeted DTC could drive volume and I think we have a lot of opportunity from Europe .
To make an impact, but Frank anything you would add to that.
I think that's a nice summary, Matt.
Great. Thank you Brian great. Thanks, Matt Thank you.
Please standby for our next question.
Our next question comes from Yaron Werber with Cowen Your line is now.
<unk>.
Hi. Thank you this is joey on for your own.
So our understanding of formularies are typically negotiated in the back half of the year in the fall and winter for the following calendar year. So I guess my question and our first question is are you sort of also with your formulary additions for two.
<unk> hundred 23 calendar year or do you expect further additions.
And then our second question is just on the Crohn's disease indication for anyone on the line.
I think on Clinicaltrials Gov.
Eric I'll start date for that was around mid 'twenty three is that when you plan to study have you chosen the dose already.
And are you potentially waiting for the chronic maintenance data from the UC study to select a dose. Thank you.
Yes, I will answer those questions in reverse order. So on the 31 O. One question on Crohn's. So there was a trial on <unk> Gov that Pfizer had put up that was out there.
Pacific trial design.
That is not the study that we intend to run and Pfizer basically decided not to run that study around the time, they got serious discussion with us in order to allow us to design a study of our choosing.
We are preparing.
For information about our Crohns plan, shortly and we'll share it when we're ready.
And we'll continue to share updates on our clinical plans overall for 31 on one over the course of this year, including partially.
After the maintenance data is right out of which we've spoken to FDA about our phase III plans and usage charges.
That's on that one.
I'll hand, it over to Frank to answer the formulary question other than to say, we are not done for the year and we have some other major formulary additions that we expect to make imminently that would have a meaningful impact on that number but Frank I'll hand, it over to you.
Yeah.
Yeah, Thanks, Matt I think the.
What you said is while generally true about industry structure, and what we've seen with <unk> and the exceptional job done by our team there Jeremy.
Is the kind of remarkable patient and physician demand for the product has changed those cycles change the negotiation timeline of those cycles and just generally.
<unk> led to a much higher degree of engagement.
Across the board with.
Typical timelines.
Largely yes.
Not being the deciding factor for any of our access conversations. So we're really excited by that because I think it speaks to the fundamental value of the product is bringing to patients and the community in dermatology.
Alright, Thanks, a lot.
Yes.
Interest rate and I expect our covered lives to increase significantly between now and the next update we provided.
Thank you very much for your question.
Please standby for our next question.
Our next question comes from Louise Chen with Cantor. Your line is now open.
Hi, Thank you for taking my questions and congratulations on a productive quarter.
Two questions for you first one I wanted to ask you is that I know were expecting some update and the anti FBR in space from some of your competitor second quarter first the IBP from J&J rheumatoid arthritis later in the year. How do you think those will impact your thinking on your clinical development.
Okay.
Yes, Thanks, Louise it's a yes, it's a great question and maybe I'll hand over to Mike <unk> got bunch. After I address a couple of words look I think.
I think the really nice thing about F. CRM as a target is that <unk> has been a phenomenal biomarker for clinical efficacy and so I think we will get a lot of information from any competitor rehab that shows the relationship between agg.
Clinically meaningful data.
Yes, I think.
We'll learn more about how <unk>.
<unk> study was conducted.
Little bit more about that when J&J choose to share. It obviously the world is watching the organic studying very closely.
One of things I think will be interesting for us in that study and the reason we're running a study of our own is because that's what he is not going to inform us on what the impact of a higher IGT suppression would be simply because <unk> can't suppress ige.
At the same level as well as our agents Ken. So we're excited to learn more about dose ranging from our own <unk> study, but obviously theres a lot of interesting questions around the way MCR and works for that patient population that we learn from that study.
At a high level I think that data will be informative and there's probably other data coming through there.
There was a data from a competitor a small indication just a couple of weeks ago that was probably sort of new to the field are informative and yet another place in which <unk> works off let's sort of at a high level, Mike anything you'd add there.
Not really Matt I mean, I think you said it really homerun scenario.
Our program in our franchise overall.
I see that there is sort of validation and efficacy from these other programs.
<unk>.
That leaves room on the table or greater efficacy from our greater Igt's suppression.
Okay. Thank you and then can I ask you about that but there's also an SLA.
<unk> data coming up and just curious how it performed versus some of its competitors such as <unk> and what are you expecting would be considered a positive outcome from your studies.
Yes, Thanks, Louise it's a great question look obviously, we're excited to generate the data.
From Brent Bowen SLE.
Obviously <unk> has been a challenging indication and so we're approaching it with a healthy amount of respect for that challenge.
And understanding that Pfizer did a lot of the preliminary work and a lot of the execution on that study that said I think theres a lot of reason to be very optimistic here.
For starters, you mentioned a couple of competitors basically PREPA as you know is a dual inhibitor of <unk>. One we have data about a JAK. One you mentioned <unk>, which was I think pretty good in phase II in okay in phase III from a topline perspective.
We have data from <unk>, which is a little bit variable, but also fairly impressive.
Relative to the field in SLE and then what we know is in cross trial comparisons across other indications and we have cross trial data with either <unk> or <unk> in each one.
<unk> Psoriatic arthritis, ulcerative colitis, and LP shaft and in each of those indications <unk>.
<unk> has produced sort of numerically superior data and crusher are comparison than either or both of those are standalone Jack Warner take too. This is kind of in line with how we think of repo, which is it's just a really big gun.
It's a powerful drug that appears to produce sort of top end efficacy and we think <unk> is the kind of population where that could make a.
Make a big difference might be going if you could add there.
No not really I mean, I think look.
Ben lift.
<unk> was.
It was approved and show the efficacy but.
With that MRI for Delta between nine and 14% across all of our studies and in spite of that.
A blockbuster drug I think is showing kind of peak.
Unmet need is still remaining there.
<unk> and the results next year.
As reminder, this 52 week study fully enrolled as of August .
Okay. Thank you and then just one last really quick question. When do you expect to reach steady state for you Greg.
Hello.
Yes, so we haven't provided exact guidance on that and it depends a little bit on some of the final payer discussions.
And then as you've seen with other competitors of ours it probably takes.
Six plus months for GTS to sort of really flow through from a contracting process. So I would say I would expect to see meaningful sort of step function improvements over the course of this year, especially as you get into a sort of middle and back half of the year.
I'd say, it's probably the case that those last couple of like well see a meaningful set of England at some point it will slow down a little bit in those last couple of percentage points of improvement is getting us the true steady states I will take a little bit of time beyond that I think.
They're contracting gets you 80% to 90% of the way there.
And then the last little bit.
Other things things like distribution costs that are often sort of volume based on their contracts. So those take a little bit longer to hit.
Thank you.
Please standby for our next question Jamie.
Our next question comes from Neena <unk> Garg with Citi. Your line is now open.
Hey, guys. Thanks for taking my question.
And so on.
The anti <unk>.
I appreciate you providing some additional color on to the next section. It's all indications, but can you just talk a little bit more about the breadth of indications that you see.
As applicable for an anti <unk> agent and when we could see some updates on that front and then just a follow up to the last question Doug.
<unk> to net.
Any updated thoughts on what we should expect in terms of the long term growth cannot drove a tomo. Thanks.
So I'll take the second question first and then I'll start on the first one probably will hand, it over to make for his thoughts as well.
On the <unk> question.
Yes, we havent given specific numerical guidance, that's been sort of a principal stamps of ours, because we are actively negotiating as you can see.
Probably literally dozens of payers and regional plans and some pbms and those discussions are all sort of active negotiations.
I will say it seems like the field has sort of settled on a standard answer to the question of what a biotech company steady state GT and looks like and it seems like our various topical competitors as well as even things like <unk> and <unk> or whatever all of sort of settled on a similar answer and so I would expect us to be kind of the same as everybody.
Also steady state.
Is the honest answer to that question.
<unk>.
Tijuana and in terms of breadth of indications I think you'd probably hear it from me, but there's a lot of enthusiasm for where to go beyond.
UC and Crohn's I think in terms of timing we will share.
Thoughts on.
On our clinical plan when we're ready.
And because of the competitive nature of that space, probably going to be a little bit careful about disclosing exactly when and what we're doing from an indication perspective, but maybe if you want to talk a little bit about the potential breadth, there and how broad it could really go Kevin.
Yeah look I think we're excited I think we've talked.
A bit about sort of the.
There's a wide range of indications for which I think at this point <unk> is implicated uniquely again, but the yes.
Yes.
And then <unk>.
As well as anti fibrotic.
Types of indications and I think just as we've done with some of our other programs.
You should expect us to.
Go and strike a balance of indications that are already at this point been validated as well as indications from which we wont be first in class.
As well in <unk>.
The only thing I'd add to that is just remember we ultimately expect to have a franchise of <unk> antibodies. We have an option on next generation compounds. The advisors now disclosed is a bi specific antibody to <unk>, which we think will have.
<unk> interesting biology and potential applicability.
In different indications in different settings, and so we're watching that closely globally weighs out we're going to get phase one data in 2020 by there but exciting for for the full breadth of what we should be able to do with that franchise.
Got it thank you.
Thank you for your question.
Please standby for our next question.
Okay.
Our next question comes from Robyn Karnow scarce with Truest. Your line is now open.
Great. Thanks.
A couple of let me just first ask about the Thomas scripts.
So the data Brian if I look at it correctly they seem to be stabilizing maybe you could talk a little bit about what kind of trends youre seeing with patients.
The senior a minimum effect.
Is this a sort of a factor of of coverage or is it more about just like trends with patients and what do you expect going forward and then.
Just a sort of a question around <unk> as immunotherapy, so you've got a lot of <unk>.
Big data sets come out with fortunate too and then potential alright data firm NEPA caliban permitting and so there's a lot of questions we're getting around.
How much.
This opportunity could really expand and you'd have to maybe do a lot more trials.
Once we see data in rheumatoid and with Fortinet Q, how does that work between you and <unk> and deciding how broad you actually can expand the market for <unk> as a stand and how does it work and we get a lot of questions on M&A and whether or not like.
If someone approached you for that for that that company like how does it work as far as your factor against whether or not that company could be acquired thank you.
Yes, Thanks Ron.
Yeah.
Just a couple of great questions. We appreciate it and good to hear from you.
<unk> was the first thing I'll say is.
I don't think we believe that the scripts are stabilizing I think Kevin.
We think theres, a little bit of chop in the last month, or so which was a combination of the holidays and then we had winter salesforce meetings that we had a third of our sales force out of the field for each of sort of three consecutive.
<unk> weeks and when we look at trends of the dock level.
We are optimistic that we continue to grow in all of the important directions. There. So I think you will continue to see scripts growing from here I think the data for what it's worth as the potential to supercharge that just in terms of drawing <unk> attention to what this drug is capable of broadly, but I think even without that you should expect to see.
Real sort of growth focus.
In the script numbers and obviously, the payer contracting progress, which much of which is pretty recent is helpful. There but.
But also just sort of continued enthusiasm we think will builds for volumes from here. So again I appreciate that it looks a little choppy in the last month or so, but I think I think youll see that looking better and better over time.
On <unk>.
Yes look I think we agree that there is a lot of opportunity here.
Our relationship with <unk> is really tight Frank's exec chair.
We work incredibly closely with them on indication strategy, obviously, there team is experienced and thoughtful.
And has a lot of great ideas.
We try and bring the best of relevant to the table as well so that we're bringing all the best ideas up for consideration.
A lot of ideas for where that could go obviously both internally.
And.
And externally.
And so we learned a lot from the field.
As far as M&A is concerned look it's fantastic to be in a category with so much therapeutic relevance.
And just see that opportunities are growing frequently as our competitors and we can show new data.
I think it's fair to say we are.
And economic actor as far as how we think about <unk>.
We understand the great appeal with <unk>, we will have as a target.
For many big pharma companies.
It's fair to say, while we would be involved in any discussions that we.
Thoughtfully and rationally as we as we hear anything.
And just a follow up there I missed this really good question.
But can you stop it for example to say if someone approach isn't to have it.
Offer firm universe that are interested and I just ask because I get the question icon at times.
How does the relationship between <unk> and immune about work if that situation were to unfold.
<unk>.
Okay, sorry, sorry.
Follow up with that.
No it's good.
I appreciate there's a lot of.
A lot of questions about the stuff look the simple answer is that we are a majority shareholder like any other majority shareholder and so we have mechanical voting control, but as I said, we're an economically rational actor.
I don't think the question of whether we could stop M&A winds up being a particularly relevant questions to the way that we expect any situation to develop great.
Great and one last one so.
You really have done a good job of talking about all your programs ongoing a lot of catalyst driven when we go back to the original format of romance with having.
Engine that produces drugs like what are your thoughts on how we should view the cadence of.
New new that's coming out of the company. This year when you have so much data coming out theres. So many big opportunities with the current.
You have on the market how do we think about the rest of the company as a whole.
Okay. Thank you. It's a great question look the first thing I'll say is we've been very mindful of the capital environment over the last call. It 18 months and obviously that effects the bar for new programs over the effects the way that we think about opportunity.
That said look I think.
There's approximately nobody out there who.
Regrets.
Fact that we brought in our anti <unk> antibody that was something that was not on anybody's radar as a part of <unk> as recently is about $3 five months ago.
So this is the thing we often do best.
And what I think is the bar is high but if we see more opportunities with the same quality as <unk> you got to imagine we're going to take them.
And the same thing is true for external opportunities and for things that develop internally, whether it's clinical data or something sort of going into a new phase of life. If the data are compelling we will figure out a way to progressive.
Please standby for our next question.
Our next question comes from Corrine Jenkins with Goldman Sachs. Your line is now open.
Yes, good morning, everyone maybe.
Maybe just with additional time centered at the time of launch what can you share with respect to what youre seeing from patient behavior in terms of things like <unk>.
What's the rate at which Youre seeing any result, if youre seeing much of that.
Yeah. Thanks, Karen.
Great question look I think the first thing is the most important thing that's come out of the time since launch is just a lot of patient did not enthusiastic for the product.
We have a decent number of refills you can see it in the approximation of the IMS script data around <unk>.
I think we will continue to see patients.
Many patients using multiple tubes, a year I think exactly how many tubes year in parsing out that behavior to be honest I wish I had thought I wish I could stop saying, it's I think it's still a little bit premature to fully know the answer to how many tubes a year, but.
The quote unquote good news as it remains true that steroids are generally kind of one to two to three year products and mostly the opportunity that we're chasing is to replace Sara trips with E. Commerce reps. So I think theres upside from more scripts beyond that per year or more to get beyond that for Europe , but that has plenty of opportunity for the near term.
Premature to give sort of a quantification to tubes per year, but in general.
We see a decent amount of repo activity, which we take as a sign of patient enthusiasm.
Helpful. Thanks, and then maybe on Purion online just as you think about additional indications section through the year can you help us understand which criteria, you're using to assess which indications eurocentric interested in pursuing.
I'll hand, it over to you for that question, sorry, I missed the question.
Curious select new indications.
Yes.
I mean, I think I think.
Look I think.
We look at it I think very Holistically I think.
It's a mix.
Our mix.
Strength of biological basis, or a mechanistic evidence in support of it and then I think to a certain extent.
So yes.
Design and so on a structure of a clinical trial in other words is there a way.
And which would give kind of finding the answer or see a signal.
With with.
Running a very large study.
The next study.
Yes, I think the other thing two other things one is obviously, we're focused on commercial opportunities or the size of the indication of the size of the opportunity and frankly, given the quality of the clinical data, we've seen and you see just a huge amount of.
Potential for the glass, we want to make sure we're maximizing that opportunity.
Go back to another answer I gave which is this is one of the areas where over the long term, having a franchise with multiple approaches to <unk> as we will between Arthur lead program and then the tier 140, <unk> specific gives us an opportunity to think holistically about indication strategy over time, obviously right now.
You can imagine we are doing the work on the biggest fastest opportunities for where we can go with <unk> and have an impact that is.
IBD in size and then we'll sort of branch out from there.
Great. Thank you.
Please standby for our next question.
Our next question comes from Dan <unk> with Jefferies. Your line is now open.
Hi, good morning, Thanks for taking my questions.
Three questions.
<unk> so number one.
Look at the industry maintenance data for you see it does look a little bit noisy with some drugs, showing where mission going nuts, I'm showing it coming down in <unk> and I'll be the first time maintenance data will be reported for a tailwind.
Antibody, obviously, you've looked at some of the initial data already and you said that the data has held up so are you confident that when we get the chronic data in the first half that we're mission wouldn't come down.
From the induction period, and then number two I don't see anywhere on your slides.
About your phase III plans, when you're seeing given.
<unk> is obviously, a very competitive space, what additional things you need to do before phase III starts and are you confident that phase three would start this year.
And then lastly can you remind us.
Press reiterate your confidence around the sub Q formulation that youll be taking into phase.
A phase III. Thank you.
Great. Thanks, Dan So those are all great questions. So on the first one I'm not a superstitious person, but I find it hard to express confidence in clinical Readouts that we are again theres still real data to collect there there's still patients, but we don't we don't have the data for patients who are versus still being evaluated but.
I think.
I agree with you that there are drugs that are all over the map from degradation to improvement in efficacy.
I will say that we start from a very favorable bar are sort of induction data was really strong.
So I think.
Flat would create still some of the best 52 week data of the world has ever seen so I think from that perspective in some ways. The question is a little bit less relevant to us and to some other classes, where the induction data maybe on the disappointing side within the maintenance date have pulled it up into more interest in territory I think for us flat or even a little bit of degradation is probably commercially fine.
Obviously, theres certainly the possibility with the anti fibrotic effect and so on to see better, but we'll see that when we see the data so look I think.
I think we feel good about where we are we feel good about what we know based on the interim look but that we'll know for sure when we see the beta and we're excited to share it with everybody once we got it.
On.
On Crohn's I'll say first of all I agree with you, it's a competitive space and I think one of the reasons that we're being a little bit careful with how we communicate about the study start and timelines and Thats frankly for both Crohn's and UC.
Is that we're sort of focused on that competitive environment. We have as you know an incredibly robust phase III dataset with full dose ranging in our phase III study was run subdues youre asking about <unk> into phase III Fort worth we are the only <unk> antibody with actual patient data in our clinical trial from any sub Q formulation. So I think we've got a lot of information.
Formation in our hands that will aid with phase III design that will allow us to run a tight fast phase III program and so I think we're sort of holding a lot of that design question in reserve competitively as we think it's an advantage to them and get the product.
And we will share it kind of when we're when we're ready.
Look on.
On the sub Q.
Opportunity, what's the first thing I'll say is I'll just remind everybody.
We.
We are the only <unk> anti <unk> antibody that has been studied in patient sub Q.
<unk>.
Our data gives us tremendous confidence around our ability to treat patients subdue and to deliver the kind of efficacy that you've seen.
<unk>.
<unk>.
We are ready to take gave more concentrated formulation that our phase III Fort.
Our relation into phase III we're.
We're not going to comment right now on the specifics, but we are highly confident.
About that formulation and that work was effectively already completed even before we took the program an advisor so thats ready to go and in short we're not we don't.
We don't think there'll be any issues with sub Q formulation.
And yes field feel good about our ability to carry the drive <unk> into phase III given the data we've already got from <unk> and our phase III Theres no no issues with our formulation whatsoever.
Got it. Thank you that's very helpful.
Thanks Dennis.
Please standby for our next question.
Our next question comes from Douglas Tsao with H C. W. Your line is now open.
Hi, good morning, Thanks for taking my questions and congrats on the progress Matt So.
Maybe just touching on your emerging ini franchise.
Just curious Matt because.
As a company where you guys have had a history of monetizing assets, obviously to Robin's question. There is.
Question is around the strategic value of.
And as well as other individual assets. So just curious how.
Especially if you think each of these are individually towards building, an II franchise or do you think given the strength of the asset.
Individual ones can be could be potentially separate it out.
They still have the franchise stand on its own thank you.
Yes.
Great question I think the short answer is we.
We are fiercely economic actors in every way and so on the one hand, we're very proud of the franchise that we built and the opportunity for a for each of these things and on the other hand, we've got the track record that you've observed.
Last thing I'll say is.
There are a lot of interest in individual.
Programs and targets out there, obviously, but also as a whole there are many businesses.
They need to expand by multiple opportunities at the same time and so the franchise in aggregate could also present, some unique opportunities and actually at least one of our past organizations that you referred to involve the franchise with multiple programs.
I would say nothing is nothing is off the table.
I guess so.
Matt do you at what point, just given the size of that category and when you look at many of the leading players. They have multiple assets do you think that you need to have multiple assets to be effective in ini commercially or do you think that that is.
Alright.
Yes sort of interpretation and that given the strength of each of your assets. They can stand on their own.
And frankly, a matter I think most of the things in our portfolio could mechanically stand on their own.
Just given the quality of the individual things that we've got certainly.
One of our competitors in CRM has shown that a single SDR and antibody can succeed on its own.
I think our competitor <unk>.
Such a unique target talks about the fact that it couldnt mechanically stand on its own and that said, there's clearly also a synergistic opportunity in these things sort of co existing and being next to each other and certainly if any of these things were to wind up in big pharma hands, there would be benefit to sort of being co resident with other ini program. So look I think these things can definitely stand alone, but I think there are.
Also some value to having them together.
Okay, great. Thank you so much.
Okay.
I am showing no further questions at this time I would now like to turn the conference back to Matt Klein for closing remarks.
Thank you operator, thank you everybody for listening. This morning, we appreciate it it's been an exciting quarter.
We've got a lot of opportunity to talk about some updates looking forward to sharing more in the very near future and look forward to getting back together with our 10-K later this year as well so we'll talked multiple times before that and we will speak again on a call like this closer to the middle of the year. Thank you everybody and have a great day.
This concludes today's conference call. Thank you for participating you may now disconnect.
Goodbye.
The conference will begin shortly to raise and lower Johan during Q&A you can dial.
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