Q4 2022 FibroGen Inc Earnings Call

February 27, 2023

Yeah.

Okay.

Thank you for standing by and welcome to the five year old Gen. Its fourth quarter and full year 2022 financial results earnings call.

At this time all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During this session you will need to press star one on your telephone.

I would now like to hand, the call over to your host Mike Tom. Please go ahead.

Thank you Latif and good afternoon, everyone I'm, Michael Tang Vice President of corporate strategy and Investor Relations at five region.

Joining me on today's call are Rick It can turn out our Chief Executive Officer, Dr. Mark <unk>, our Chief Medical Officer.

One Graham our Chief Financial Officer, Dr. John Hunter, our Chief Scientific Officer.

<unk>, our chief commercial officer, and Chris Chung, our senior Vice President of China operations.

Format for todays call includes prepared remarks from and regain one after which we will open up the call for Q&A.

I would like to remind you that remarks made on today's call include forward looking statements about fiber Jay.

Statements may include but are not limited to <unk>.

Our collaborations with Astrazeneca and Astellas financial guidance.

The initiation enrollment design conduct and results of clinical trials, our regulatory strategies and potential regulatory results.

Our research and development activities commercial results and results of operations risks related to our business.

Certain other business matters each.

Each forward looking statement is subject to risks and uncertainties that could cause actual results and events to differ materially from those projected in that statement.

A more complete description of these and other material risks can be found in <unk> filings with the SEC, including our most recent Form 10-K and Form 10-Q.

<unk> does not undertake any obligation to update publicly any forward looking statements, whether as a result of new information future events or otherwise.

A press release reporting our financial results and business update and a webcast of today's conference call can be found on the investors section of <unk> website at Www <unk> Dot com.

That I would like to turn the call over to Rick internal our CEO Enrique.

Thank you Mike.

Known to everyone and welcome to our fourth quarter and full year 2022 earnings call.

On today's call I intend to provide a high level summary of.

Of important accomplishments and developments for 2022 and recent months.

<unk>, our CFO will then review the financials.

After which we will open the call for your questions.

Starting with slide three.

<unk> is positioned to create significant value for patients and shareholders by executing.

On three areas of focus.

Number one delivering pivotal phase III umbrella my data.

In three high value indications.

Idiopathic pulmonary fibrosis Duchenne muscular dystrophy.

Locally advanced Unresectable pancreatic cancer.

Number two.

Increasing our research productivity by advancing novel programs.

The leverage internal expertise and access external innovation for additional pipeline opportunities.

Number three ensuring.

The commercial success of <unk> study in patients with chronic kidney disease were approved.

We'll continue to explore additional indications.

Moving on to slide four.

Courage and represents an exciting catalyst rich opportunity.

Top line data for five pivotal phase III trials are expected this year.

And an additional two by mid 2024.

In 2022.

We completed enrollment of multiple clinical trials for both from Red Blue map on Brooks.

And our broker showcases our capability to deliver on our clinical trial goes.

And advance our pipeline.

We are preparing for various clinical trial outcome scenarios.

Which could include multiple regulatory filings and.

And ultimately launches to expeditiously delivered these potential therapies to patients.

Operationally, we are well prepared to execute.

Our plan.

And importantly.

We have a strong financial position.

And our continued focus on financial discipline.

With a wide array of options to consider and so we'll look for opportunities to strengthen.

Our cash position over time.

Now, let's move to our clinical trial timelines on slide five.

Starting with revenue map.

I want to remind everyone that we have both FDA fast track and.

And FDA orphan disease designation for all three of these indications.

Idiopathic pulmonary fibrosis, or IPF, duchenne muscular dystrophy or DMD and.

And locally advanced Unresectable pancreatic pancreatic cancer or <unk> are each diseases with significant unmet medical need and represent meaningful potential opportunities to improve the lives of patients.

Moving chronologically we expect.

Topline data from the Atlantis, one our phase III trial of umbrella might be non ambulatory patients with DMD in.

In the second quarter of 2023.

Top line data from <unk>, one our phase III trial in IPF in mid 2023.

Data from our Atlanta stood trial.

Military patients with DMD in the third quarter of 2023.

Now looking out to next year, our LAPIS phase III study.

In locally advanced pancreatic cancer is expected to readout in the first half of 2024.

Finally, our separate two phase III trial in patients with IPF.

It is expected to report out mid 2024.

In addition, although not on the slide the pancreatic cancer Axon network spanned com precision promise adaptive trial.

Platform evaluating <unk> in combination with standard of care for patients with metastatic pancreatic cancer continues to progress.

A common question we receive.

Whether there is any read through between the umbrella trials.

IPF.

DMD.

And <unk> are three very different diseases.

All with a common feature of fibrosis.

But each with a unique pathophysiology affecting different artists.

In IPF.

Fibrosis in the lung tissue causes progressive.

And irreversible damage.

DMD is a rare genetic disease characterized by fibrosis.

By fibrosis in the muscles.

And <unk> is an oncology indication in which tumor associated fibrosis is a key feature of the disease.

Given these differences in Dcs.

Pathophysiology, we believe there is limited or no read through on efficacy from one of these conditions to the others.

On the safety side.

<unk> has been studied in over a thousand patients.

<unk> demonstrated a favorable adverse event and safety profile.

Including in patients who have been dosed for up to seven years.

Moving to <unk> to the <unk> timelines on the bottom of slide five.

We anticipate readouts from.

The Matterhorn phase III trial in patients with anemia, or Miller dysplastic syndrome.

The second quarter of 2023.

And data from our China Phase III study in.

He patients with chemotherapy induced anemia expected in the second quarter.

2023 as well.

This will be a transformational year for fiber Gen and we look forward to sharing these results the results of these studies.

I would like to expand.

Gratitude.

Two patients.

Caregivers and investigators as well as to my <unk> colleagues.

For their commitments.

I would now like to spend a few minutes highlighting our view of the significant commercial opportunity, we see with barnburner demand are.

Our wholly owned <unk>.

Clonal antibody.

Starting on slide six.

I will be providing a more detailed perspective on our view of the IPF opportunity that in past calls.

With a diagnosed prevalence of approximately 330000 patients.

Across the U S EU, China and Japan.

IPF represents a significant opportunity with the two approved IPF therapies generating together almost $4 billion in global net revenue in 2021.

Despite the size and growth of <unk> market.

There remains an important unmet needs with the two approved anti fibrotic therapies as characterized by continued disease progression.

And challenging Tolerability.

There is a sentiment in the IPF community of limitations with the current therapies and we believe umbrella map.

Has the potential to help a sizable number of patients have become a relevant product for the treatment of IPF.

As we highlight on slide seven.

We believe that IPF patients could benefit from new therapeutic options.

IPF is a progressive disease, where fibrosis in the lung tissue leads to irreversible loss of lung function.

Resulting in high morbidity and mortality.

In fact.

Median survival following diagnosis of IPF is only three to five years.

The limitations of current treatment options are well characterized.

Having a modest a modest effect.

Slowing the progressive loss of lung function, along with a challenging tolerability profile.

This translates into a low treatment rates.

Depicted on the right side of slide seven.

In the U S.

There is a prevalence of approximately 120000 patients with IPF.

With approximately 30000 patients diagnosed each year.

Of these 30000 newly diagnosed patients we estimate that only about one third of these patients are treated with an anti fibrotic.

And of these roughly 10000 patient to start one of the two approved anti fibrotic in a given year.

Approximately 40% to 50% discontinued treatment in the first 12 months.

Usually get the side effects, which include severe nausea, diarrhea and photo sensitivity.

Resulting in a large proportion of diagnosed <unk> patients.

Not being treated with standard of care for these progressive and deadly condition.

Because of the significant unmet need we believe umbrella has the potential to be an important addition to.

To current Ips treatment options.

<unk> effectively for.

Newly diagnosed patients.

For existing patients.

Have not been treated with anti fibrotic.

And as well as those patients who have stopped anti fibrotic treatment due to challenging tolerability.

Moving on to slide eight.

<unk> muscular dystrophy.

And locally advanced and Resectable pancreatic cancer each represent significant opportunities.

Starting with DMD in the left column.

Given the devastating nature of DMD and the relentless progression of the D C.

We are hopeful the Atlantis.

The length of this phase III program can lead to an approved therapy.

That is desperately needed by the DMD community.

Well the currently approved exon skipping therapies produce an increase in dystrophin levels.

They target only a small portion of DMD patients.

I have yet to demonstrate a meaningful clinical improvement in symptoms or disease progression.

There is clear need for DMD therapies that can add in rare disease progression by targeting the downstream.

The logical changes to improve muscle function and prolonged emulation.

We're hopeful.

AT&T for voting mechanism of <unk> may be a treatment that can help these patients and their families.

The Atlantis one.

And broad non ambulatory patients 12 years and older.

With more advanced DMD disease.

The primary endpoint is the performance of upper limb test.

Which measured functionality of the shoulder elbow wrist and hand.

Lantus too and broad ambulatory patients six to 12 years old with less advanced <unk>.

The primary endpoint is the Northstar ambulatory assessment.

As a measure ambulatory function.

Okay.

In the right height column, we show a snapshot of the locally advanced pancreatic cancer opportunity.

I'm, sorry cancer represents one of the largest unmet needs in oncology.

Given the diagnosed prevalence of over 90000 patients across the major regions.

Combined with a low five year disease free survival rate of around 10%.

We believe that railroad has both direct antitumor effects on effects from the stroma.

This is why we are evaluating both.

<unk>.

As well as metastatic pancreatic cancer.

There have been limited treatment advances over the last two decades.

With immuno oncology therapies, failing to demonstrate survival benefits.

Over the current standard of care.

This creates a potential meaningful opportunity.

<unk>, if we can demonstrate a significant improvement in overall survival.

Now, let's move to the update on <unk> on slide nine.

Brooks. This is currently in phase III clinical trials for the treatment of anemia.

In Myelodysplastic syndrome, or Mds in the U S and Europe .

For the treatment of patients with chemotherapy induced anemia or CIA in China.

Starting with me all of these spreads Miller dysplastic syndrome or Mds.

Mds or a group of rare blood disorders.

Occur because of abnormal development of blood cells within the bone marrow.

Did you say estimated that more than 10000 patients are diagnosed with Mds each year in the U S.

And overall prevalence is estimated to be between 60000 and 170000.

<unk> in the U S.

And he made some major complication present in 85% of patients with Mds.

When first diagnosed and causes fatigue.

Shortness of breath, dizziness, and weakness on over time can lead to frequent.

Red blood cell transfusions.

More recently.

<unk> was approved in this indication.

And its successful launch illustrates the unmet medical need.

We expect topline data from our global Phase III Matterhorn Mds trial in.

In the second quarter of 2023.

Finally, we also expect topline data from our China phase III chemotherapy induced anemia trial.

In the second quarter of 2023.

Moving onto slide 10.

I do want to take a moment and comment on our early stage pipeline.

We expect to file.

Up to two <unk> in the second half of 2023.

FSC.

31 65.

Anti <unk> antibody.

Developed to reverse immune resistance in many solid tumors.

And inhibit target driven cancer progression.

In AML acute myeloid leukemia.

<unk> thousand 165 has been shown pre clinically.

To prevent the nine mediated cell death of T cell subtypes that are critical for anti tumor immune responses.

And he's undergoing characterization for its ability to directly target.

Keeping sub populations.

<unk> 31 63.

<unk> is an anti <unk> antibody.

Scientists selected fleet.

Suppressive T regulatory cells in the tumor.

Microenvironment without affecting peripheral T regulatory cells.

Use of <unk> 163, solid tumors has broad potential to activate immune responses and induce tumor cell killing.

Without disrupting normally immune comer status.

Additionally.

We have undisclosed preclinical development program to leverage our expertise in <unk> and.

<unk> biology.

And moving now to China on Slide 11.

Brookside booster continuously robust with robust growth in China.

We are reporting.

Fourth quarter total <unk> sales in China, $53 $1 million by five region.

And joined distribution entity compared to $32 million in the fourth quarter of 2021.

This growth was driven by an increasing volume of over 90%.

Brooks. This is a net sales growth for full year, 2022, and China was $22 $7 million.

Which was driven by.

By an increasing volume of ore of over 80%.

Fiber dense.

Portion.

<unk> net product revenue in China was $23 $4 million for the fourth quarter.

An $82 9 million for the full year 2022 on a U S GAAP basis.

One will elaborate further in the financial update.

Next.

On Slide 12, Slide 12 provides a snapshot.

Brookside booster journey growth index to December 2020.

On the chart on the left.

As well as year over year growth in the table on the right.

Of note.

These are significant unit growth of Brookside boosters.

While the leading Esa Brian is up slightly reflecting the anemia of CATV market expansion.

That has been driven by <unk> seen since the original and narrowed the listing in 2020.

I'm going to now turn the call over to our CFO , one gram for the financial update.

Thank you Enrique.

Our 2020 through has come to a close I want to begin by thanking our colleagues in the United States and China.

For their ongoing commitment to advancing our commercial assets as well as our clinical pipeline.

As we opened 2023.

We're excited about the opportunities ahead with with five phase III clinical trials reading out during the course of the year.

We are well positioned to continue to deliver on our strategic priorities as we have our upcoming phase III trial Readouts for <unk> and <unk>.

<unk> acid continues on its growth trajectory in China in the <unk> territories.

And as we advance our preclinical pipeline.

2023 is a pivotal year for <unk> and we're excited to be in a position to potentially deliver life altering therapies for patients.

Now getting into our financial results.

Full year revenue for 2022 was $147 million.

Versus $235 $3 million in 2021.

<unk> 2021 included a $120 million milestone payment from our partner Astellas related to the European Commission approval of <unk> for the treatment of adult patients with symptomatic anemia associated with <unk>.

For the fourth quarter of 2022 total revenue was $34 4 million compared to $16 $5 million for the same period in 2021.

Breakdown of revenue sources for the fourth quarter is as follows.

We recorded $23 4 million of net product revenue for Rockford do start sales in China compared to $5 5 million in the fourth quarter of 2021.

Which represents an increase of $17 9 million or 328% increase year over year.

During the quarter. We also recorded development revenue of $4 5 million associated with co development efforts for <unk> with our partners as compared to $10 million during the fourth quarter of 2021.

Due to the stage of development of <unk> with our partners. We expect co development revenues to be in the range of $3 million to $5 million per quarter for 2023.

Lastly, we recorded $6 $5 million in drug product revenue for Rockford do step bulk drug or active pharmaceutical ingredients sold to astellas as compared to $1 1 million during the fourth quarter of 2021 the.

The increase was primarily associated with the volume of shipments in the quarter, partially offset by a change in our estimates related to these shipments mostly impacted by the Japanese yen depreciation versus the U S dollar.

Now diving deeper into Rux would you start in China.

Total <unk> net sales from the joint distribution entity jointly owned by Astrazeneca and fiber agenda or J D. E was $53 $1 million this quarter compared to $32 million in the fourth quarter of 2021, an increase of 66%.

After last year's and our deal price adjustment 2022 sales performance of <unk> that resulted from a significant volume increase of over 90% versus fourth quarter of 2021.

It is worth noting that the full year 2022 volume increase versus full year 2021 with over 80% benefitting from the <unk> price renegotiation.

As we enter 2023, we expect meaningful net sales growth for rux are due starting training.

Moving from <unk> net sales in China.

Jim Snap transfer price from sales to the JV was $17 2 million for the fourth quarter consistent with a 30% to 45% range of the J D. <unk> reduced that net sales, which we have continuously guided.

During this quarter, we recorded an additional $3 $1 million from the previously deferred balance due to the change in our future estimates as per U S. GAAP, the main driver being favorable renminbi currency impact.

As we have communicated in the past the deferred revenue balance and.

And <unk> in China fluctuates based on management estimates of future revenue.

As a result fiber Gen recorded $23 million in net revenue for the quarter from Merck <unk> sales to the J D.

And $3 1 million.

Direct and distributor sales from fibers in China.

As I move into the P&L. It is worth noting our focus on execution, enabling us to be more disciplined in our spending.

Our operating costs and expenses for the fourth quarter of 2022 were $105 million.

Compared to $151 8 million for the fourth quarter of 2021.

The main changes of R&D expenses versus 2021 were $35 million expense related to the option execution to in license the Mtc CRA program.

Hi Fi buyer during Q4, 2021, and lower clinical trial expenses and drug supply costs associated with our prime revenue maps for prime revenue my programs.

R&D expenses for the fourth quarter of 2022 were $61 $6 million compared to $113 $9 million in the fourth quarter of 2021.

Of the $61 6 million roughly 61% was dedicated to prime Revlon map development and CMC activities.

21% allocated to support our early stage pipeline and the remaining 18% directed towards <unk> development activities in the United States and China.

SG&A expenses for the fourth quarter of 2022 were $34 million compared to $34 7 million in the fourth quarter of 2021, representing a 2% reduction year over year. This change was driven by our cost management efforts more than offsetting inflationary pressures.

During the fourth quarter of 2020, we recorded a net loss of $66 2 million.

Or 77.

<unk> net loss per both basic and diluted share as compared to a net loss of $134 1 million or $1 45 per basic and diluted share for the fourth quarter of 2021.

With regards to our financing efforts during Q4, we completed our revenue interest monetization transaction with no request capital management, a $50 million for 22, 5% of <unk> astellas related drugs.

Product revenue this.

This financing further strengthens our balance sheet to continue supporting our strategic priorities.

On slide 13 of our presentation, we make reference that at December 31.

We reported $442 7 million in cash cash equivalents investments and accounts receivable.

Our ending cash balance is roughly $48 million higher than the midpoint of our most recent year end cash guidance, which included the revenue interest monetization transaction with no request the.

The cash increase is driven by a mix of savings spend prioritization and movement of onetime payments into 2023.

Going forward, we believe that we are well funded through multiple key clinical milestones and we expect our cash cash equivalents investments and accounts receivable to be sufficient to fund our operating plan into the second half of 2024.

As we have previously stated we are privileged to have a variety of options to further strengthen our balance sheet to meet our strategic objectives.

As we close on 2022, we are pleased with our team's performance achieving strong operational and financial results.

We entered 2023, we believe we are well positioned to execute on our strategic operational and financial goals and a pivotal year for <unk>.

Thank you and now I would like to turn the call back over to Enrique.

In closing I would like to reiterate our confidence and excitement as we embark on 2023.

We are committed to advancing <unk> as a potential first in class medicine.

And through indications with significant unmet medical need and as noted we expect topline data from three <unk> people to phase III studies in 2023.

There's one in non ambulatory patients with DMD in the second quarter of 2023.

<unk> won in IPF in IPF patients midyear in Atlanta, two in ambulatory patients with DMD.

In the third quarter of 2023.

In addition, we expect top line data from two <unk> pivotal phase III studies.

Matterhorn.

Patients with anemia of Mds in the second quarter of this year.

And China CIA study in.

In the second quarter of this year as well.

In our early stage pilot and we expect to file up to two <unk> in the second half of 2023.

<unk> 31 to 63 and anti <unk> antibody.

<unk> 31, 65 in Antigua nine antibody both in oncology.

Brooklyn continues to perform very well in China on our partner Astellas continues with the commercialization of Brooklyn.

In Europe and Japan.

We believe we're appropriately finance through key topline band railroad data releases.

And we're privileged with a wide array of options to consider as we continue to look for opportunities to strengthen our cash position over time.

Now I would like to turn it over.

To the operator for the.

The Q&A.

As a reminder to ask a question you will need to press star one one on your telephone again Thats Star one one on your telephone to ask a question. Please standby, while we compile the Q&A roster.

Okay.

Our first question comes from the line Michael.

Jefferies. Your question please Michael.

Hello. This is Andrew <unk> on for Michael Thanks for taking our questions.

Two on <unk>.

Ips. Please first one is.

Can you remind us what prompted you to change the primary endpoint of your second Phase III study recently I believe it was from time to progression type of analysis to the sea change at week 48, So what went well what happened there and then secondly is what percent of enrolled patients.

And these Ips studies.

For both <unk> and placebo Dx staff to go on rescue therapy, and how does rescue therapy impact.

Our study outcome as well as your stats analysis. Thanks.

Very good.

Bookstore Eisner to address both umbrella my questions sure. Thanks. Thanks for the question. So we are constantly in touch with regulators, including FDA European authorities, and others and we monitor the external environment closely and it.

It's always been true that zephyrus, one has had the primary endpoint of FTC and it's become clear.

That the FCC is actually the global standard for approval. So we've just.

Harmonized and aligned both as our first one in his efforts to to have FCC as the primary endpoint.

Key secondary endpoint will be the disease progression defined as FCC, 10% or more decline.

Or depth, so that will continue to be there and just to wrap it up we're confident that this will meet global regulatory standards.

For approval.

In terms of background standard of care. So just to remind everyone. These are both monotherapy trials in other words, it's Pam rebel mab versus placebo in patients who are not on standard of care.

Patients can be either treatment naive at baseline or experienced in the past, we do allow patients to initiate standard of care on the trial, if there a physician deems it appropriate these or both.

<unk> therapies.

We don't believe this will be a very common event.

And we don't believe it will have substantive impact on the overall results. Because these trials are well powered and we plan on an intention to treat analysis.

And very last one if I may is that okay. If I can ask a last one.

Of course.

Thanks.

Speaking of the powering.

What the powering assumptions for both phase III studies be the same on the primary endpoint and secondly, what would you say as a clinically meaningful efficacy results in the phase III data, what kind of separation versus placebo on FTC do you want to say thank you.

Alright. So the first question is about the powering of that first one and Jeff first two for a forced vital capacity in both studies aim to enroll 240 patients we enrolled slightly more than our first one so yes. The powering will be the same for both studies and we think.

Daily adequate for detecting.

You know, it's an effect size that's planned for in terms of a clinically meaningful effect for efficacy and Thats a really good question.

Have designed the phase III program.

To be highly similar to the phase two program or pre study with the intention that we can replicate what we see is very highly clinically and statistically meaningful results in praise in the phase III program. So that is the intent that said we.

Our powered for effect sizes that are somewhat smaller I think.

There's not a clear standard for what is meaningful but.

We do intend to replicate praise or something close to that so we're very confident that we will find a meaningful result in the zephyrus program.

Thanks very helpful. Appreciate it.

Thank you.

Our next question.

Comes from the line of Jason <unk> of Bank of America. Your line is open Jason.

Hey, guys. Thanks for taking my questions.

A follow up on that last question. So its efficacy in the ballpark of praise something that gets you in the right zone of a discussion regarding ability to file based on phrases that first one.

And then Enrique.

Talking about the ICF market a lot of the shortcomings of the current standard of care therapies is brought up and the tolerability issues and what I Wonder is.

Even if you don't assume any increase in treatment right. So you still have a third of new starts getting treated.

Just wondering how big could the market be if these drugs had.

More appropriate duration of therapy that might be commensurate with a drug that's reasonably tolerate I'm. Just wondering if you sort of increase that duration of therapy toggle, how big could that market be and then just lastly client had some data and they're going to have 24 week data in Q I believe.

Wanted to get your thoughts just on what you saw from the competitor approach.

So the first question around efficacy I think it's important to remember when we're framing that.

A question that the current standard of care is limited by poor Tolerability, and specifically Gi side effects, nausea, diarrhea, and those sorts of things. So we expect <unk> to have a much better tolerability profile. So we have to think about both the benefit and the tolerability.

When answering your question.

The second point is yes, we are aiming to replicate praise and we've kept the design similar in terms of primary endpoint at 48 weeks in both phase II and phase III FCC is the endpoint, but it will be a totality of the results right. It will be the primary endpoint the secondary endpoints and the Tolerability together.

Determine the overall benefit risk profile. So I don't think its as simple as saying particular threshold on FTC, because it's going to be kind of a comprehensive look at the product and <unk>.

Turning next part of the question over to Enrique.

Sure. So I think your question was.

Given the introduction of a product if I understood. The premise of your question that may have better tolerability, how could that impact.

The overall market size we.

We have to look at the overall profile of the product right, but.

<unk> includes the efficacy and as Mark stated we.

<unk>.

Our intent is to replicate praise, but assuming the profile of the product.

Has the.

The.

Replicates the.

The efficacy and a good tolerability profile.

I think we have to start by thinking about okay.

If 40% to 50% of the patients are discontinuing therapy within the first year.

You can imagine that that's a significant driver for many of those patients to go into a new therapy those patients were already.

Arctic compelled to seek a treatment.

And now we're basically offering an option that is highly martin potentially more efficacious, even though we don't have we won't have a head to head trial.

And with a good tolerability profile.

But I.

I think we also need to think about.

The.

Patients that are not being treated today I think it's we have to think about.

The full opportunity for the product.

Because out of 30000 patients and this is the U S that we're talking about that are diagnosed every year only about one third are being treated with the anti fibrotic.

So the expansion of the treatment rates I think it's also a significant opportunity for Pam.

To be able to offer benefit risk profile that is different from that of the other products.

And significantly enabled.

Meaningful overall market growth.

So we think about our opportunity. This is probably the one area that we're trying to emphasize with investors, where we see an opportunity that is.

Larger.

And then.

Maybe whats reported out there given these dynamics I just mentioned.

Yes, just briefly in terms of the client results.

You had alluded to the week 24 results. So just a couple of points I mean first of all.

They're early in development, we have seen in the phase Iia data, which are at 12 weeks or whether that can extrapolate.

24 weeks or more importantly, 48 to 52 weeks, which will be required for approval as a question.

Sort of longer term safety remains a question and and of course, the efficacy beyond 12 weeks. So those will be questions as well as the dose response and how is that holding up so a lot of questions. There still will be watching as you are.

For the week 24 results, but even with that Theres still going to be a lot more to be answered in later stage clinical trials.

Got it thanks guys.

Yeah.

Thank you.

Our next question.

Comes from the line of Andy <unk> of William Blair. Your line is open Andy.

Great. Thanks for taking my questions.

Maybe we could start with Linzess wine.

<unk>.

I noticed that.

One year trial, but I'm just curious in terms of the non ambulatory <unk>.

<unk>.

Disease progression.

In terms of.

Ah patient.

Patients succumbing to the disease.

How long does it take if you want to see that signal.

In terms of OLED separation do you need and are there any sign that debt.

Based on real World experience, they can start to see something like that.

Yeah.

Alright. Thanks.

Thanks for the question I think you're asking about in the non ambulatory population of Atlanta.

One whether we would expect to be powered for overall survival or mortality signal.

I think that will be challenging.

Study of slightly less than 100 patients. We are looking at performance of the upper limb as the primary endpoint will also be looking at forced vital capacity percent predicted and other secondary endpoints that camera reflect the overall disease progression.

I think overall survival would be a challenge, although it's certainly something we will be trucking.

And related to planned in.

One is there.

Q&A as I believe you mentioned about filing based on one study or the potential of <unk>.

Something like that and so that challenges the conventional wisdom Elise regarding the regulatory pathway.

I'm just curious from your interaction with the FDA do you see kind of a shift in terms of the agency Stan.

And with that kind of open up.

Data supports two to file on one.

Yeah.

Good question.

The filing strategy and I would bring it back to our program in particular.

And what we said before and what we continue to believe is that if it will be data dependent and FDA feedback dependent about whether we can file our first one before.

Before the results of their first two in particular, we'd be looking for highly clinically and statistically meaningful results on the primary endpoint secondary endpoints and also a very good benefit risk profile in terms of the safety and how that all plays in.

If we see those kinds of findings we will of course be discussing that with the FDA about whether we could file based on the single trial for whether we need to based on both trials for filing.

In terms of the broader regulatory landscape I do think this continues to evolve.

<unk> is still has been two trials.

But I think this will be dependent on the data in our case that we generate and the feedback from the FDA.

Yeah.

It is worth noting.

Worth, noting my colleague thing reminds me that both Roche and by half.

One trial in IPF.

As indicated by their Cte dot Gov closings.

Right right exactly.

Got it maybe just one quick question could you remind us for the Ics steady.

Do you do you have incorporated like an interim efficacy look.

Yeah.

Yes.

No interim efficacy evaluations now.

Got it okay. That's helpful. Thank you so much for answering all of all of our questions.

Sure of course.

Thank you.

Our next question.

It comes from the line of Danielle Brill of Raymond James Your line is open Danielle.

Guys. Good afternoon. Thanks, so much for the question.

I guess first I want to clarify you said a few times now that you are powered.

Replicate craze in the Zephyrus trials.

But there seems to be clear precedent that effect sizes are lower in phase III versus phase two so I guess.

Just wanted to clarify did you consider this and other potential factors that may impair treatment effect size when you powered the trial.

And then I have a couple of follow ups.

Yes, let me.

But just quickly address this yes, we did.

Mark mentioned, we are very well powered.

While our intent is to.

Replicate praise.

When we power, we basically did some discounting of the SBC and we still powered over 90% so.

We took some of those dynamics that you referenced into account.

That's very helpful. Thanks, Thanks for that clarification, Enrique and then another question that comes up.

When talking to investors.

Is the potential impact of Covid and.

Data integrity issues that may arise given the study was conducted throughout the pandemic can you just comment on measures that you took to mitigate any missed infusions or dropouts in the study.

Yes.

Sure so.

First of all I think I mean, youre right Covid has been a challenge over the last few years I think.

One point to consider is that.

Patients with IPF, because they have severe underlying lung disease or counseled by their physicians.

To be cautious and Tim Boyd exposure, thereby minimizing the risk of infection. So we're expecting that that will help to mitigate the effect of COVID-19 and its impact on these patients, but we have taken a lot of our careful approach to maintaining patient recruitment I mean patient.

Sure.

Maintenance on the studies, we have allowed some flexibility flexibility in terms of follow up visit windows things of that nature, which regulatory authorities have allowed for.

We've allowed home infusions in countries, where that's allowed so we've taken a lot of measures to be really thoughtful and to try to do our best to keep patients on the study and maintain data integrity and we are confident that we will have a very robust dataset at the end of the trials.

Excellent. Thank you and maybe I can just squeeze in one last one on manufacturing I know you switched.

Manufacturers prepayment as they map well.

You have commercial manufacturing in place by the time of launch and are there any.

FTA requirement for bio equivalency or dosing needed prior to that first of all thank you.

Yes. Thank you yes. The answer is yes, we believe we will have.

Give it to have commercial product manufacture.

I'd expected launch dates.

So we've made quite a lot of progress on our manufacturing capabilities as you know.

<unk>.

Conducted a.

Transfer with Samsung.

Sure.

I believe that has gone very well.

So at this point I think our.

Our thinking is that analytical comparability will be the only thing that would be required for us.

To be able to utilize the commercial product from Samsung.

Okay.

Got it thank you for the question.

Thank you.

Our next question.

Comes from the line of yarn Werber of Cowen Your question. Please yarn.

Great. Thanks for taking.

Got a couple of maybe just the first one just to follow up on the last question. The analytical comparability is that something you can do in parallel to the phase III is that been done already or is that part of the phase III and can you confirm that you've actually are using supply out of Samsung.

One of the phase III.

And then secondly on the meta Horn study the data we're going to get I believe is the 24 week data can you file on that or do you need to wait for the 52 week data for Mds. Thank you.

Yes.

I'll, let mark answer I think.

Second question, but analytical comparability basically comparing the product on an analytical basis right all of the characteristics of the product when we look at the product that wasn't manufacture.

Bye bye and the product that is manufactured but by Samsung So it doesn't require any.

A study of that.

In clinical trials.

I believe we are.

We're in a really good position of course, we also discuss these with regulatory.

With regulatory agencies.

So at this stage I think we feel good in terms of where we are from manufacturing and overall CMC perspective, I'm going to let now.

Mark answered the Mds question sure. So the primary efficacy endpoint in Matterhorn does that week 28, although the study goes through week 52 for secondary efficacy endpoints and safety end points as well. So it is our plan based on the 28.

Data assuming that it's positive to have the discussion with FDA about whether that data at week 28 would surprise suffice for filing, but it's our position that that should be the case, but that would have to be dependent on the efficacy the strength of the efficacy safety the benefit risk and the FDA.

Feedback.

Okay.

Thank you.

Our next question comes from the line of Annabel <unk> of Stifel. Your line is open.

Please go ahead Annabel.

Hi, sorry, I didn't hear the name.

Just going back to.

That's helpful.

Question.

I understand that you haven't really.

Hello.

What.

I guess, that's a hero.

Sir you are aiming for and your powering.

In terms of talking to physicians.

Is there a scenario today.

Have some kind of.

Hey, guys.

Reduction of benchmark of reduction in mind or improvement, rather and also see where is it statistically wolfcamp, but maybe it's slower than press around the same range or may be lower than the other products on the market.

But they are able to have a tolerable drug that patients stay on.

It's also helpful for social community. She has multiple smart trials, so I guess that's.

That's the first question I have.

Thank you.

Are you looking at.

Can you remind us what specific.

Fibrosis, biomarkers that youre looking to add to that.

<unk> can also.

I guess I appreciate benefit beyond just FCC improvement that's the first question and then one on Lantus.

Clearly our.

I'm going to just.

Provide a quick top line, but then I'm going to ask Mark to comment, but clearly the intent that we have is to replicate brace.

Theres been some discussion about.

Whether in phase III trials, sometimes.

The effect size.

Maybe to decrease somewhat.

That could be the case, but we've also made what I'm going to call. Some minor adjustments to the study for example, lowering the SBC.

At baseline.

In terms of inclusion criteria so that.

We can ensure that they are we are enrolling patients that are progressing and so forth.

So.

The intent is to replicate <unk> now I'm going to have.

Talk about your question in terms of what could be meaningful.

From a commercial perspective, yes, I don't really think that.

Physicians when we talk to them highlight a specific FEC threshold that will be necessary right. I mean, I think it's as you said, we expect the tolerability to be much improved versus standard of care in patients can't benefit from treatments that they can't stay on so that yes, we do think there'll be a.

A significant benefit with <unk> in terms of Tolerability, we do expect to hit.

Robust FCC results in terms of reducing the attenuation of FCC decline and we also have other endpoints like disease progression endpoint, the quantitative lung fibrosis by high resolution C T scan.

Disease progression endpoints like Oh.

Cute IPF exacerbation hospitalization and mortality so we'll have a very rich.

Ray of endpoints to characterize the benefit of the drug even above and beyond.

FTC and in terms of Biomarkers.

<unk> quantity of lung fibrosis score is imaging biomarker that we do think we have very meaningful results in phase II and praise and we are including endpoint in phase III. So we're hopeful to continue to be able to show not only that.

Patients have reduction in the decline of their lung function as measured by FCC, but less evolution of scarring of fibrosis by the qol scores. So we're going to have quite a comprehensive view of our camera will map can do for the patient based on the whole sequence of endpoints.

Annabel. This is thing maybe just to add a little bit of color to what Enrique and Mark has said.

We put a profile in front of clinicians.

And they have a really good understanding for what to expect from both <unk> and given the eight plus years on the market. They don't respect back to us specific FPC difference relative to placebo that they would expect to see.

And in fact, if you look at the phase III trials between <unk> create the absolute differences between those drags on placebo are quite different from one another but in relative terms. They are fairly similar to one another but they tend to tell US is and then this is the key reason why we believe more patients arent treated as they just don't believe the risk benefit is in favor of treating with the drug for many of these.

Patients and so that means that they're not only taking a look at the potential reduction in FTC decline. We're also taking a look at the tolerability of the quality of life aspects for the individual patient and so when we share with them. The <unk> profile and we show just a very base case FPC.

A reduction difference from placebo thats in the ballpark of <unk>, which even though <unk> was actually a bit better than that.

When they look at the totality of the profile. There are a lot of patient cases that we put in front of them, where they prefer Pam revenue relative to the two current dental fibrotic options.

Okay, Great that's really helpful.

And then just a quick question on Atlantis, one so clearly there are slightly different endpoints, because you've got different patient population here.

Non ambulatory I wish they had more upper limb measurements many of the Northstar ambulatory for Lantus.

Is there any crossover.

And any of the <unk> question, Atlanta, Finally, Atlanta, two such that today.

There is no benefit on ambulatory Hoffman, but there could be some benefit on.

Upper limb assessments are functional assessments like that like we saw in Orlando. One is there anything there that can be drawn.

Ross compared in that way.

It just seems like the two different endpoints or so.

Are such different alright, ultra these two different patient populations.

Yes, no interesting question.

Yes, I mean remember recall for everyone that we will address one the non ambulatory study comes first before are oriented to the ambulatory study because as you are alluding to the the non ambulatory patients have already lost the ability to walk their wheelchair bound in their function is much more limited we are.

Needing to use the performance of the upper limb, which is a validated endpoint that assesses upper limb function because they've already lost so much lower limb another function. So.

So I think it will be a bit challenging to be.

Predicting well anthos to outcomes based on the length of one in other words, if we see a signal in Atlanta was one we could see even a bigger signal in Atlanta was too because they still have so much more function. The north star ambulatory assessment provides a more sort of a holistic evaluation of the patients I think.

At the end of the day, the data will be the data, but I think.

We're starting the first read out youre going to get is the most difficult patient population. The non ambulatory population, who has already lost the most function and the signal to noise for the endpoints are are the most challenging later, we'll get <unk> to where I think because these patients have more function of baseline it'll be.

A little bit more clear cut in terms of evaluating the efficacy.

Okay, great. Thank you so much.

Thank you at this time I would like to turn the call back over to Enrique Conterno for closing remarks, Sir.

No.

Thank you very much to everyone for your participation in today's investor call and your interest in <unk> and very much enjoy the rest of your day. Thank you very much.

This concludes today's conference call. Thank you for participating you may now disconnect.

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Thank you for standing by and welcome to <unk> fourth quarter and full year 2022 financial results earnings call. At this time all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During the session you will need to press star.

One one on your telephone.

I would now like to hand, the call over to your host Mike Tom. Please go ahead.

Thank you Latif and good afternoon, everyone I'm, Michael Tang Vice President of corporate strategy and Investor Relations at five region.

Joining me on today's call are Rick It can turn off our Chief Executive Officer, Dr. Marc <unk>, our Chief Medical Officer.

One Graham our Chief Financial Officer, Dr. John Hunter, our Chief Scientific Officer.

<unk>, our chief commercial officer, and Chris Chung, our senior Vice President of China operations.

Format for todays call includes prepared remarks from a regain one after which we will open up the call for Q&A I.

I'd like to remind you that remarks made on today's call include forward looking statements about far Virginia such statements may include but are not limited to.

Our collaborations with Astrazeneca and Astellas financial guidance the <unk>.

<unk> enrollment design conduct and results of clinical trials, our regulatory strategies and potential regulatory results.

Our research and development activities commercial results and results of operations risks related to our business.

And certain other business matters.

Each forward looking statement is subject to risks and uncertainties that could cause actual results and events to differ materially from those projected in that statement.

A more complete description of these and other material risks can be found in <unk> filings with the SEC, including our most recent Form 10-K and Form 10-Q.

Robert and does not undertake any obligation to update publicly any forward looking statements, whether as a result of new information future events or otherwise.

A press release reporting our financial results and business update and a webcast of today's conference call can be found on the investors section of <unk> website at Www Biogen Dot com.

With that I would like to turn the call over to Rick internal our CEO Enrique.

Thank you, Mike and good afternoon, everyone and welcome to our fourth quarter and full year 2022 earnings call.

On today's call I intend to provide a high level summary of.

Of important accomplishments and developments for 2022 and recent months.

<unk>, our CFO will then review the financials.

After which we will open the call for your questions.

Starting with slide three.

<unk> is positioned to create significant value for patients and shareholders by executing.

On three areas of focus.

Number one delivering pivotal phase III umbrella data.

In three high value indications.

Idiopathic pulmonary fibrosis Duchenne muscular dystrophy.

Locally advanced Unresectable pancreatic cancer.

Number two.

Increasing our research productivity by advancing novel programs.

The leverage internal expertise and access external innovation for additional pipeline opportunities.

Number three ensuring.

The commercial success of <unk> in patients with chronic kidney disease were approved.

We'll continue to explore additional indications.

Moving onto slide four.

Okay.

Courage and represents an exciting catalyst rich opportunity.

Top line data for five pivotal phase III trials are expected this year.

And an additional two by mid 2024.

In 2022.

We completed enrollment of multiple clinical trials for both <unk> and <unk>.

On a broker showcases our capability to deliver on our clinical trial goes.

And advance our pipeline.

We are preparing for various clinical trial outcome scenarios.

Which could include multiple regulatory filings and.

And ultimately launches to expeditiously delivered these potential therapies to patients.

Operationally, we are well prepared to execute our plan.

And importantly.

We have a strong financial position.

And our continued focus on financial discipline.

With a wide array of options to consider as we look for opportunities to strengthen our cost our cash position over time.

Now, let's move to our clinical trial timelines on slide five.

Starting with <unk>.

I want to remind everyone that we have both FDA fast track and.

And FDA orphan disease designation for all three of these indications.

Idiopathic pulmonary fibrosis, or IPF, duchenne muscular dystrophy or DMD and.

Moving chronologically we expect.

Top line data from the Atlantis, one our phase III trial of <unk> might be non ambulatory patients with DMD in.

In the second quarter of 2023.

Top line data from <unk>, one our phase III trial in IPF in mid 2023.

Data from our Atlanta stood trial.

Military patients with DMD in the third quarter of 2023.

Now looking out to next year, our LAPIS phase III study.

In locally advanced pancreatic cancer is expected to readout in the first half of 2024.

And finally, our separate two phase III trial in patient with IPF.

It is expected to report out mid 2024.

In addition, although not on the slide the pancreatic cancer action network spanned com precision promise adaptive trial platform evaluating <unk> in combination with standard of care for patients with metastatic pancreatic cancer continues to progress.

A common question we receive.

Is whether there is any read through between the umbrella trials.

IPF.

DMD.

And <unk> are three very different diseases, all with a common feature of fibrosis.

But each with a unique pathophysiology affecting different organs.

In IPF.

<unk> fibrosis in the lung tissue causes progressive.

And irreversible damage.

DMD is a rare genetic disease characterized by fibrosis.

By fibrosis in the muscles.

<unk> is an oncology indication in which tumor associated fibrosis is a key feature of the disease.

Given these differences in the six plus.

Positive histology, we believe there is limited or no read through on efficacy from one of these conditions to the others.

On the safety side.

<unk> has been studied in over a thousand patients.

<unk> demonstrated a favorable adverse event and safety profile.

Including in patients who have been dosed for up to seven years.

Yeah.

Moving to <unk> to the <unk> timelines on the bottom on slide five.

We anticipate readouts from the.

Matterhorn phase III trial in patients with anemia, or Miller dysplastic syndrome.

The second quarter of 2023.

And data from our China Phase III study in.

Patients with chemotherapy induced anemia expected in the second quarter of 2023 as well.

This will be a transformational year for fiber Jen.

We look forward to sharing these results the results of these studies.

I would like to extend my.

Gratitude.

Two patients.

Caregivers and investigators as well as to my <unk> colleagues.

For their commitments.

I would now like to spend a few minutes highlighting our view of the significant commercial opportunity, we see with <unk>.

Our wholly owned monoclonal antibody.

Starting on slide six.

I will be providing a more detailed perspective on our view of the IPF opportunity than in past calls.

With a diagnosed prevalence of approximately 330000 patients.

Across the U S EU, China and Japan.

IPF represents a significant opportunity with the two approved IPF therapies generating together almost $4 billion in global net revenue in 2021.

Despite the size and growth of VIP of market.

There remains an important unmet needs with the two approved anti fibrotic therapies as characterized by continued disease progression.

And challenging Tolerability.

There is a sentiment in the Ips community of limitations with the current therapies and we believe umbrella map.

Has the potential to help a sizable number of patients have become a relevant product for the treatment of IPF.

As we highlight on slide seven.

We believe that IPF patients could benefit from new therapeutic options.

IPF is a progressive disease, where fibrosis in the lung tissue leads to irreversible loss of lung function.

Resulting in high morbidity and mortality.

And in fact.

Median survival following diagnosis of IPF is only three to five years.

The limitations of current treatment options are well characterized.

Having a modest a modest effect.

Slowing the progressive loss of lung function, along with a challenging tolerability profile.

This translates into a low treatment rates.

Depicted on the right side of slide seven.

In the U S.

There is a prevalence of approximately 120000 patients with IPF.

With approximately 30000 patients diagnosed each year.

Of these 30000 newly diagnosed patients we estimate that only about one third of these patients are treated with an anti fibrotic.

And of these roughly 10000 patient the start one of the two approved anti fibrotic in a given year.

Approximately 40% to 50% discontinued treatment in the first 12 months.

I, usually get the side effects, which include severe nausea, diarrhea and photo sensitivity.

Resulting in a larger proportion of diagnosed <unk> patients.

Not being treated with standard of care for these progressive and deadly condition.

Because of the significant unmet need we believe umbrella has the potential to be an important addition.

Two current Ips treatment options.

Competing effectively for.

Newly diagnosed patients.

For existing patients.

Who have not been treated with anti fibrotic.

And as well as those patients who have stopped anti fibrotic treatment due to challenging tolerability.

Moving on to slide eight.

Duchenne muscular dystrophy.

And locally advanced Unresectable pancreatic cancer each represent significant opportunities.

It started with DMD in the left column.

Given the devastating nature of DMD and the relentless progression of the D C.

We are hopeful that the Lantus lantus phase III program.

Lead to an approved therapy.

That is desperately needed by the DMD community.

While the currently approved exon skipping therapies produce an increase in dystrophin levels.

They target only a small portion of DMD patients.

I have yet to demonstrate a meaningful clinical improvement in symptoms or disease progression.

There is clear need for DMD therapies that can attenuate disease progression by targeting the downstream pathological changes to improve muscle function and prolonged emulation.

We're hopeful.

Identity for voting mechanism of <unk> may be a treatment that can help these patients under five minutes.

The Atlantis one.

And broad non ambulatory patients 12 years and older.

With more advanced DMD disease.

The primary endpoint is the performance of upper limb test.

Which measured functionality of the shoulder elbow wrist and hand.

Lantus too and broad ambulatory patients six to 12 years old.

With less advanced <unk>.

The primary endpoint is the Northstar ambulatory assessment, which.

Which is a measure ambulatory function.

Okay.

In the right height column, we show a snapshot of the locally advanced pancreatic cancer opportunity.

Concord cancer represents one of the largest unmet need in oncology.

Given the diagnosed prevalence of over 90000 patients across the major regions combined.

With a low five year disease free survival rate of around 10%.

We believe that railroad has both direct antitumor effects on effects from the stroma.

This is why we are evaluating both.

<unk>.

As well as metastatic pancreatic cancer.

There have been limited treatment advances over the last two decades.

With immuno oncology therapies, failing to demonstrate survival benefits over.

Over the current standard of care.

This creates a potential meaningful opportunity.

For <unk>, if we can demonstrate a significant improvement in overall survival.

Now, let's move to the update on <unk> on slide nine.

Brooks. This is currently in phase III clinical trials for the treatment of anemia.

In Menlo Dysplastic syndrome, Mds in the U S and Europe and.

And for the treatment of patients with chemotherapy induced anemia or CIA in China.

Okay.

Starting with me all of these spreads Miller dysplastic syndrome or Mds.

Mds or a group of rare blood disorders that occur because of abnormal development of blood cells within the bone marrow.

Did you say estimated that more than 10000 patients are diagnosed with Mds each year in the U S.

And overall prevalence is estimated to be between $60000.

170000.

Patients in the U S.

And he made some major complication present in 85% of patients with MBS.

When first diagnosed and causes fatigue.

Shortness of breath, dizziness, and weakness on over time can lead to frequent red.

Red blood cell transfusions.

More recently.

<unk> was approved in this indication.

And its successful launch illustrates the unmet medical need.

We expect top line data from our global Phase III Matterhorn Mds trial in.

In the second quarter of 2023.

Finally, we also expect topline data from our China phase III chemotherapy induced anemia trial.

In the second quarter of 2023.

Moving onto slide 10.

I do want to take a moment and comment on our early stage pipeline.

We expect to file.

Up to two <unk> in the second half of 2023.

AFC.

<unk> 165 is an anti <unk> antibody.

Developed to reverse immune resistance in many solid tumors.

Target driven cancer progression.

In AML acute myeloid leukemia.

<unk> thousand 165 has been shown pre clinically.

To prevent <unk> nine mediated cell death of T cell subtypes that are critical for anti tumor immune responses.

And he's undergoing characterization for its ability to directly target.

Leukemic cell populations.

<unk> 31 63.

He is an anti <unk> antibody.

Scientists selected fleet.

Suppressive T regulatory cells in the tumor.

Microenvironment without affecting peripheral T regulatory cells.

Use of <unk> 31 to 63 solid tumors, because broad potential to activate immune responses and induce tumor cell killing.

We saw disrupting normally immune comer status.

Additionally.

We have undisclosed preclinical development program to leverage our expertise in shifts and CPG biology.

And moving now to China on Slide 11.

Brookside booster continuously robust with robust growth in China.

We are reporting.

Fourth quarter total Roxanne <unk> Soc in China, $53 $1 million by five region.

And <unk>.

<unk> distribution entity compared to $32 million in the fourth quarter of 2021.

This growth was driven by an increasing volume of over 90%.

Brooks unnecessarily growth for full year 2022 in China.

$22 $7 million.

Which was driven.

By an increasing volume of ore of over 80%.

Fiber dense.

Portion.

<unk> net product revenue in China was $23 $4 million for the fourth quarter.

An $82 9 million for the full year 2022 on a U S GAAP basis.

Ron will elaborate further in the financial update.

Next.

On Slide 12, Slide 12 provides a snapshot of.

Brookside boosted journey growth is indexed to December 2020.

On the chart on the left.

As well as year over year growth in the table on the right.

Of note.

These are significant unit growth of Brookside boosted.

While the leading Esa Brian is up slightly reflecting the anemia of CATV market expansion.

That has been driven by <unk> seen since the original and narrowed the listing in 2020.

I'm going to now turn the call over to our CFO , one gram for the financial update.

Thank you Enrique.

As 2020 through has come to a close I want to begin by thanking our colleagues in the United States and China for their ongoing commitment to advancing our commercial assets as well as our clinical pipeline.

As we opened 2023.

We're excited about the opportunities ahead with with five phase III clinical trials reading out during the course of the year.

We are well positioned to continue to deliver on our strategic priorities as we have our upcoming phase III trial Readouts for <unk> and <unk>.

<unk> asset continues on its growth trajectory in China, and the Astellas territories and as we advance our preclinical pipeline.

2023 is a pivotal year for fiber again, and we're excited to be in a position to potentially deliver life altering therapies for patients.

Now getting into our financial results.

Full year revenue for 2022 was $147 million.

Versus $235 3 million in 2021.

2021 included a $120 million milestone payment from our partner Astellas related to the European Commission approval of <unk> for the treatment of adult patients with symptomatic anemia associated with <unk>.

For the fourth quarter of 2022 total revenue was $34 4 million compared to $16 $5 million for the same period in 2021.

Breakdown of revenue sources for the fourth quarter is as follows.

We recorded $23 4 million of net product revenue for <unk> sales in China compared to $5 5 million in the fourth quarter of 2021.

Which represents an increase of $17 9 million.

We're at 328% increase year over year.

Due to the stage of development of <unk> with our partners. We expect co development revenues to be in the range of $3 million to $5 million per quarter for 2023.

Lastly, we recorded $6 5 million and drug product revenue for Rockford boost that bulk drug or active pharmaceutical ingredients sold to astellas as compared to $1 $1 million during the fourth quarter of 2021 the.

Now diving deeper into Rux would you start in China.

Total <unk> net sales from the joint distribution entity jointly owned by Astrazeneca and fiber agenda or J D. E was $53 1 million this quarter compared to $32 million in the fourth quarter of 2021, an increase of 66%.

After last year's and our deal price adjustment 2022 sales performance of <unk> that resulted from a significant volume increase of over 90% versus fourth quarter of 2021.

It is worth noting that the full year 2022 volume increase versus full year 2021 with over 80% benefitting from the <unk> price renegotiation.

As we enter 2023, we expect meaningful net sales growth for rux starting training.

Moving from Rux reduced that net sales in China.

Jim Snap transfer price from sales through the JV was $17 2 million for the fourth quarter consistent with the 30% to 45% range of the JD <unk> reduced that net sales, which we have continuously guided.

During this quarter, we recorded an additional $3 1 million from the previously deferred balance due to the change in our future estimates as per U S. GAAP, the main driver being favorable renminbi currency impact.

As we have communicated in the past the deferred revenue balance and.

And <unk> in China fluctuates based on management estimates of future revenue.

As a result fiber adjourn recorded $23 million in net revenue for the quarter from Merck <unk> sales to the J D.

And $3 1 million.

Direct to distributor sales from fibers in China.

As I move into the P&L. It is worth noting our focus on execution, enabling us to be more disciplined in our spending.

Our operating costs and expenses for the fourth quarter of 2022 were $105 million.

Compared to a $151 8 million for the fourth quarter of 2021.

The main changes of R&D expenses versus 2021, we're at $35 million expense related to the option execution to in license the Mtc CRA program for <unk>.

Hi Fi Brio during Q4, 2021, and lower clinical trial expenses and drug supply costs associated with our Perm revenue maps for primarily my programs.

R&D expenses for the fourth quarter of 2022 were $61 6 million compared to $113 $9 million in the fourth quarter of 2021.

Of the $61 6 million roughly 61% was dedicated to Perm revenue map development and CMC activities.

21% allocated to support our early stage pipeline and the remaining 18% directed towards <unk> development activities in the United States and China.

During the fourth quarter of 2000, <unk>, we recorded a net loss of $66 2 million.

We're 77 seven.

<unk> net loss per both basic and diluted share as compared to a net loss of $134 1 million or $1 45 per basic and diluted share for the fourth quarter of 2021.

With regards to our financing efforts during Q4, we completed our revenue interest monetization transaction with no request capital management, a $50 million for 22, 5% of extracellular astellas related drug <unk>.

Product revenue.

This financing further strengthens our balance sheet to continue supporting our strategic priorities.

On slide 13 of our presentation, we make reference that at December 31.

We reported $442 $7 million in cash cash equivalents investments and accounts receivable.

Our ending cash balance is roughly $48 million higher than the midpoint of our most recent year end cash guidance, which included the revenue interest monetization transaction with no request the.

The cash increase is driven by a mix of savings spend prioritization and movement of onetime payments into 2023.

As we have previously stated we are privileged to have a variety of options to further strengthen our balance sheet to meet our strategic objectives.

As we close on 2022, we are pleased with our team's performance achieving strong operational and financial results.

As we enter 2023, we believe we are well positioned to execute on our strategic operational and financial goals and a pivotal year for <unk>.

Thank you and now I would like to turn the call back over to Enrique.

In closing I would like to reiterate our confidence and excitement as we embark on 2023.

We are committed to advancing <unk> as a potential first in class medicine.

And through indications with significant unmet medical need and as noted we expect topline data from three <unk> people to phase III studies in 2023.

There's one in non ambulatory patients with DMD in the second quarter of 2023.

<unk> won in IPF in IPF patients midyear and Atlantis to an ambulatory patients with DMD.

In the third quarter of 2023.

In addition, we expect topline data from two pivotal phase III studies.

Matterhorn.

Patients with anemia of Mds in the second quarter of this year.

And China.

Study in.

In the second quarter of this year as well.

In our early stage pilot and we expect to file up to two <unk> in the second half of 2023.

<unk> 31 to 63 and anti <unk> antibody.

<unk> $31 65, an anti <unk> antibody both in oncology.

Brooklyn continues to perform very well in China on our partner Astellas continues with the commercialization of Brooklyn.

In Europe and Japan.

We believe we're appropriately finance through key topline by railroad data releases.

And we're privileged with a wide array of options to consider as we continue to look for opportunities to strengthen our cash position over time.

Now I would like to turn it over to.

To the operator for the.

For the Q&A.

As a reminder to ask a question you will need to press star one one on your telephone again Thats star one on your telephone to ask a question.

Please standby, while we compile the Q&A roster.

Yes.

Our first question comes from the line Michael.

Jeffrey Your question please Michael.

Hello this.

This is Andrew Tsai on for Michael Thanks for taking our questions.

Two on.

Yes. Please.

One is.

Can you remind us what prompted you to change the primary end point of your second Phase III study recently I believe it was around that time to progression type of analysis to the sea change at week 48, so what when.

What happened there and then secondly is what percent of enrolled patients and these Ips studies.

For both <unk> and placebo Dx stack to go on rescue therapy, and how does <unk>.

Therapy impact your study outcome as well as your stats analysis. Thanks.

Very good.

Doctor Eisner to address both umbrella my questions sure. Thanks for the question. So we are constantly in touch with regulators, including FDA European authorities and others and we monitor the external environment closely.

Got it.

It's always been true that zephyrus one.

Had the primary endpoint of FTC and it's become clear.

That the FCC is actually the global standard for approval. So we have just.

Harmonized and aligned both as our first one in his efforts to to have FCC as the primary endpoint.

Key secondary endpoint will be the disease progression defined as FCC, 10% or more decline.

Or depth, so that will continue to be there and just to wrap it up we're confident that this will meet global regulatory standards.

For approval.

In terms of background standard of care. So just to remind everyone. These are both monotherapy trials in other words, it's Pam rebel mab versus placebo in patients who are not on standard of care.

Patients can be either treatment naive at baseline or experienced in the past we do allow patients to initiate standard of care on the trial. If they are a physician deems as appropriate. These are both approved therapies. We don't believe this will be a very common event.

And we don't believe it will have substantive impact on the overall results. Because these trials are well powered and we plan on an intention to treat analysis.

And very last one if I may is that okay. If I can ask a last one.

Of course thanks.

Looking at the powering.

What the powering assumptions for both phase III studies be the same on the primary endpoint and secondly, what would you say as a clinically meaningful efficacy result.

In the phase III data, what kind of separation versus placebo on FCC I want to say thank you.

Alright. So the first question is about the powering of Jeff first one and Jefferies. Two for a forced vital capacity in both studies aim to enroll 240 patients we enrolled slightly more than our first one so yes. The powering will be the same for both studies and we think highly adequate for detecting.

It's an effect size that's planned for in terms of a clinically meaningful effect for efficacy and Thats a really good question we.

We have designed the phase III program.

To be highly similar to the phase II program or pre study with the intention that we can replicate what we see is very highly clinically and statistically meaningful results and praised in the phase III program. So that is the intent that said we.

Our powered for effect sizes that are somewhat smaller I think.

There's not a clear standard for what is meaningful but.

We do intend to replicate praise or something close to that so we're very confident that we will find a meaningful result in the zephyrus program.

Thanks very helpful. Appreciate it.

Thank you.

Our next question.

Comes from the line of Jason <unk> of Bank of America. Your line is open Jason.

Hey, guys. Thanks for taking my questions.

Follow up on that last question. So its efficacy in the ballpark of praise something that gets you in the right zone of a discussion regarding ability to file based on phrases that first one.

And then Enrique.

Talking about the ICF market a lot of the shortcomings of the current standard of care therapies is brought up and the tolerability issues and what I Wonder is.

Even if you don't assume any increase in treatment right. So you still have a third of new starts getting treated.

Just wondering how big could the market be if these drugs had.

More appropriate duration of therapy that might be commensurate with a drug that is reasonably tolerate I'm. Just wondering if you sort of increase that duration of therapy toggle, how big could that market be and then just lastly client had some data and they're going to have 24 week data in Q2 I believe.

Wanted to get your thoughts just on what you saw from that competitor approach.

So the first question around efficacy I think it's important to remember when we're framing that.

When answering your question.

The second point is yes, we are aiming to replicate praise and we've kept the design similar in terms of primary endpoint at 48 weeks in both phase II and phase III FCC is the endpoint, but it will be a totality of the results right will be the primary endpoint the secondary endpoints and the Tolerability together.

Determine the overall benefit risk profile. So I don't think its as simple as saying no particular threshold on FTC, because it's going to be kind of a comprehensive look at the product and <unk>.

Turning next part of the question over to Enrique.

Sure. So I think your question was.

Given the introduction of a product if I if I understood. The premise of your question that may have better tolerability, how could that impact.

The overall market size we.

We have to look at the overall profile of the product right, but.

<unk> includes the efficacy and as Mark stated we.

<unk>.

Our intent is to replicate praise, but assuming the profile of the product.

Has the.

The.

Replicates the.

The efficacy and a good tolerability profile.

I think we have to start by thinking about okay.

If 40% to 50% of the patients are discontinuing therapy within the first year.

You can imagine that's a significant driver for many of those patients to go into a new therapy those patients were already.

Multi compelled to seek a treatment.

And now we're basically offering an option that is highly martin potentially more efficacious, even though we don't have we won't have a head to head trial.

And with a good tolerability profile.

But I.

I think we also need to think about.

<unk>.

Patients that are not being treated today I think it's we have to think about.

The full opportunity for the product.

Because out of 30000 patients and this is the U S that we're talking about that are diagnosed every year only about one third are being treated with antibiotics.

So the expansion of the treatment rate I think is also a significant.

The opportunity for Pam.

To be able to offer benefit risk profile is different from that of the other products.

Significantly enabled.

Meaningful overall market growth.

So we think about our opportunity. This is probably the one area that we're trying to emphasize with investors, where we see an opportunity that is.

Larger.

And then.

Maybe whats reported out there given the dynamics I just mentioned.

Yes, just briefly in terms of the client results.

You had alluded to the week 24 results. So just a couple of points I mean first of all.

They're early in development, we have seen in the phase Iia data, which are at 12 weeks or whether that can extrapolate.

24 weeks or more importantly, 48 to 52 weeks, which will be required for approval as a question.

Sort of longer term safety remains a question.

Of course, the efficacy beyond 12 weeks, so those will be questions as well as the dose response and how is that holding up so a lot of questions. There still will be watching as you are.

For the week 24 results, but even with that Theres still going to be a lot more to be answered in later stage clinical trials.

Got it thanks guys.

Yeah.

Thank you.

Our next question.

Comes from the line of Andy <unk> of William Blair. Your line is open Andy.

Great. Thanks for taking my questions.

Maybe we can start with wine.

<unk>.

I don't think.

One year trial, but I'm just curious in terms of the non ambulatory <unk>.

<unk>.

Disease progression.

In terms of.

<unk>.

Patients succumbing to the disease.

How long does it take if you want to see that signal.

In terms of OLED separation do you need and are there any sign that debt.

Based on real World experience, they can start to see something like that.

Yeah.

Alright. Thanks.

Thanks for the question I think you're asking about in the non ambulatory population of Atlanta.

One whether we would expect to be powered for overall survival or mortality signal.

I think that will be challenging.

Study of slightly less than 100 patients. We are looking at performance of the upper limb as the primary endpoint. We will also be looking at forced vital capacity percent predicted and other secondary endpoints that camera reflect the overall disease progression.

I think overall survival would be a challenge, although it's certainly something we will be trucking.

And related to planned in one is there.

Q&A I believe we mentioned about filing based on one study or the potential of doing something like that and so that challenges the conventional wisdom lease regarding the regulatory pathway.

Of IPF I'm, just curious from your interaction with the FDA do you see kind of a shift in terms of the agency's Dan.

And with that kind of open up if data supports two to file on one.

Okay.

Good question.

The filing strategy and I would bring it back to our program in particular.

And what we said before and what we continue to believe is that if it will be data dependent and FDA feedback dependent about whether we can file our first one.

Before the results of our first two in particular, we'd be looking for highly clinically and statistically meaningful results on the primary endpoint secondary endpoints and also a very good benefit risk profile in terms of the safety and how that all plays in.

Yes.

If we see those kinds of findings.

And of course be discussing that with the FDA about whether we could fall based on this single trial for whether we need to based on both trials for filing.

In terms of the broader regulatory landscape I do think this continues to evolve.

<unk> is still has been two trials.

But I think this will be dependent on the data in our case that we generate and the feedback from the FDA.

Yeah.

Got it is worth noting.

Worth, noting my colleague thing reminds me that both Roche and by half.

One trial in IPF.

As indicated by their Cte dot Gov postings.

Right right exactly.

Got it maybe just one quick question could you remind us for the IPF study.

Do you do you have incorporated like an interim efficacy look.

Okay.

No interim efficacy evaluations now.

Got it okay. That's helpful. Thank you so much for answering all of all of our questions.

Sure of course.

Thank you.

Our next question.

It comes from the line of Danielle Brill of Raymond James Your line is open Danielle.

Hi, guys. Good afternoon. Thanks, so much for the question.

I guess first I want to clarify you said a few times now that you are powered.

Replicate craze in the zephyrus trials, but there seems to be clear precedent that effect sizes are lower in phase III versus phase two so I guess.

Just wanted to clarify did you consider this and other potential factors that may impair treatment effect size when you powered the trial.

And then I have a couple of follow ups.

Yes, let me.

But just quickly address this yes, we did.

Mark mentioned, we are very well powered.

While our intent is to.

Replicate price.

When we powered we basically did some discounting of the SBC and we still powered over 90% so.

We took some of those dynamics that you referenced into account.

That's very helpful. Thanks, Thanks for that clarification, Enrique and then another question that comes up.

When talking to investors.

And the potential impact of Covid and.

<unk> data integrity issues that may arise given the study was conducted throughout the pandemic can you just comment on measures that you took to mitigate any missed infusions or dropouts in the study.

Yes.

Sure so.

First of all I think I mean, youre right Covid has been a challenge over the last few years.

One point to consider is that.

Patients with IPF, because they have severe underlying lung disease or counseled by their physicians.

<unk>.

Maintenance on the studies, we have allow us some flexibility flexibility in terms of follow up visit windows things of that nature, which regulatory authorities have allowed for.

Excellent. Thank you and maybe I can just squeeze in one last one on manufacturing I know you switched.

Okay manufacturers prepare mildly Matt.

You have commercial manufacturing in place by the time of launch and are there any FDA.

FDA requirements for bioequivalence CR dosing needed prior to the approval. Thank you.

Yes. Thank you yes. The answer is yes, we believe we will have.

Give it to have commercial product manufacture.

The expected launch dates.

So we've made quite a lot of progress on our manufacturing capabilities as you know.

We've.

Conducted a tech transfer with Samsung.

I believe that has gone very well.

So at this point I think our.

Our thinking is that analytical comparability will be the only thing that will be required for us to be able to utilize.

The commercial product from Samsung.

Yes.

Got it thank you for the question.

Thank you.

Our next question.

Comes from the line of yarn Werber of Cowen Your question. Please.

Great. Thanks for taking.

Got a couple of maybe just the first one just to follow up on the last question. The analytical comparability is that something.

You can do in parallel to the phase III is that been done already or is that part of the phase III and can you confirm that you've actually are using supply out of Samsung.

One of the phase III.

And then secondly on the meta Horn studies the data we're going to get I believe is the 24 week data can you file on that or do you need to wait for the 52 week data for Mds. Thank you.

Yes.

I'll, let mark answer I think the.

Second question, but I'll.

Comparability is basically comparing the product on an analytical basis right all of the characteristics of the product when we look at the product that wasn't manufacture.

By behind the product that is manufactured but by Samsung So it doesn't require any.

A study of that.

In clinical trials.

I believe we are.

We're in a really good position of course, we also discuss these with regulatory.

With regulatory agencies.

So at this stage I think we feel good in terms of where we are.

From manufacturing and overall CMC perspective, I'm going to let us know.

Mark answered the Mds question sure. So the primary efficacy endpoint in Matterhorn is that week 28, although the study goes through week 52 for secondary efficacy endpoints and safety end points as well. So it is our plan based on the 28.

Data assuming that it's positive to have the discussion with FDA about whether that data at week 28 would suffice suffice for filing, but it's our position that should be the case, but that would have to be dependent on the efficacy the strength of the efficacy safety the benefit risk and the FDA.

His feedback.

Okay.

Thank you.

Our next question comes from the line of Annabel <unk> of Stifel. Your line is open.

Please go ahead Annabel.

Hi, sorry, I didn't hear the name.

So just going back to work.

A couple of questions.

I understand that you haven't really disclosed.

What.

<unk>.

Hi, guys.

You're aiming for in your powering.

In terms of talking to physicians.

Is there a scenario did they have some kind of.

Hey, guys.

Reduction of benchmark of reduction in mind.

It rather and also see where is it statistical wolfcamp, but maybe it's lower than trends around the same range or may be lower than the other products on the market.

But they are able to have a powerful drug that patients stay on.

For the full force of community Hospital.

Smart trials, so I guess that's.

The first question I have.

Are you looking at.

Can you remind us what specific.

Slide grosses biomarkers that youre looking at that.

<unk> can also.

I guess I appreciate the benefit beyond just FCC improvement. That's the first question and then one on Lantus.

Clearly our.

I'm going to just.

Provide a quick top line, but then I'm going to ask Mark to comment, but clearly the intent that we have is to replicate brace.

There has been some discussion about.

Whether in phase III trials, sometimes.

The effect size.

Maybe to decrease somewhat.

That could be the case, but we've also made what I'm going to call. Some minor adjustments to the study for example, lowering the SBC.

At baseline.

In terms of inclusion criteria so that.

We can ensure that they are we are enrolling patients that are progressing and so forth.

So.

The intent is to replicate brace now I'm going to have.

Talk about your question in terms of what could be meaningful.

From a commercial perspective, yes, I don't really think that.

Physicians when we talk to them highlight a specific FCC threshold that will be necessary right. I mean, I think it's as you said, we expect the tolerability to be much improved versus standard of care in patients can't benefit from treatments with they can't stay on so yes, we do think there'll be a.

A significant benefit with <unk> in terms of Tolerability, we we do expect to hit.

FCC results in terms of reducing the attenuation of FCC decline and we also have other endpoints like disease progression endpoint, the quantitative lung fibrosis by high resolution C T scan.

Disease progression endpoints like.

Cute IPF exacerbations hospitalization and mortality so we'll have a very rich.

Ray of endpoints to characterize the benefit of the drug even above and beyond.

FTC and in terms of Biomarkers.

<unk> quantity of lung fibrosis score as the imaging biomarker that we do think we have very meaningful results in phase II and praise and we are including endpoint in phase III. So we're hopeful to continue to be able to show not only that.

Annabel. This is thing maybe just to add a little bit of color to what Enrique and Mark has said.

We put a profile in front of clinicians.

And they have a really good understanding for what we expect from both Avon has really given the eight plus years on the market. They don't respect back to us specific FPC difference relative to placebo that they would expect to see.

And in fact, if you look at the phase III trials between <unk> create the absolute differences between those drove some placebo are quite different from one another but in relative terms. They are fairly similar to one another but they tend to tell US is and then this is the key reason why we believe more patients arent treated as they just don't believe the risk benefit is in favor of treating with the drug for many of them.

These patients and so that means that they're not only taking a look at the potential reduction in FPC decline. We're also taking a look at the tolerability of the quality of life aspects for the individual patient and so when we share with them. The <unk> profile and we show just a very base case FPC.

Reduction difference from placebo thats in the ballpark of <unk>, which even though <unk> was actually a bit better than that.

When they look at the totality of the profile. There are a lot of patient cases that we put in front of them, where they put <unk> relative to the two current identify product options.

Okay great.

Really helpful.

And then just a quick question on Atlantis, one so clearly there are slightly different endpoints, because you've got different patient population here.

The non ambulatory I wish they had more upper limb measurements many of the Northstar ambulatory for Lantus.

Is there any crossover.

And any of the end question Atlanta is finally, Atlanta, two such that say.

Yes.

There is no benefit on ambulatory Hoffman, but there could be some benefit on.

Upper limb assessments are functional assessments like that like we saw in Orlando last one is there anything there that can be drawn.

Cross compared in that way.

It just seems like the two different endpoints or so.

Are such different hurdles for these two different patient populations.

Yes, no interesting question.

I mean remember recall for everyone that we will.

And just one the non ambulatory study comes first before Lantus to the ambulatory study.

Cause as you are alluding to the <unk> the non ambulatory patients have already lost the ability to walk their wheelchair bound in their function is much more limited we are needing to use the performance of the upper limb, which is a validated endpoint that assesses upper limb function because they've already lost so much lower than in other functions.

Alright, so I think it will be a bit challenging to be.

Predicting well anthos to outcomes based on the length of those one in other words, if we see a signal in Atlanta is one we could see even a bigger signal in Atlanta is too because they still have so much more function. The north star ambulatory assessment provides a more sort of a holistic evaluation of the patients I think.

At the end of the day, the data will be the data, but I think.

We're starting the first readout youre going to get is the most difficult patient population. The non ambulatory population, who has already lost the most function and the signal to noise for the endpoints are are the most challenging later, we will get <unk> to where I think because these patients have more function of baseline it'll be.

You know a little bit more clear cut in terms of evaluating the efficacy.

Okay, great. Thank you so much.

Thank you at this time I would like to turn the call back over to Enrique Conterno for closing remarks, Sir.

No. Thank.

Thank you very much to everyone for your participation in today's investor call and your interest in fiber Jane on very much enjoy the rest of your day. Thank you very much.

Yeah.

This concludes today's conference call. Thank you for participating you may now disconnect.

Q4 2022 FibroGen Inc Earnings Call

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