Q4 2023 G1 Therapeutics Inc Earnings Call
Operator: Good day, and thank you for standing by. Welcome to the G1 Therapeutics' fourth quarter 2023 financial results conference call. At this time, all participants are in a listen-only mode.
Good day and thank you for standing by welcome to the G. One therapeutics fourth quarter 2023 financial results Conference call.
At this time all participants are in a listen only mode.
Operator: After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised.
After the speaker's presentation, there will be a question and answer session to ask a question. During the session you will need to press star one on your telephone you will then hear an automated message advising your hand is rate withdraw. Your question. Please press star one again.
Operator: To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Will Roberts, Corporate Communications. Please go ahead.
Please be advised that today's conference is being recorded I would now like to hand, the conference over to your first speaker today Bill Roberts Corporate Communications. Please go ahead.
William C. Roberts: Thank you, RISD. Good morning, everyone, and welcome to the G1 conference call to discuss our fourth quarter and full year 2023 financial results and business update. The press release on these financial results was issued this morning and can be found in the news section of our corporate website, G1therapeutics.com. On this morning's call, the team will provide a business overview for the 2023 fourth quarter and full year, including an update on our clinical programs and our commercial progress in that period with Cocella, which is approved and commercially available to decrease the incidence of chemotherapy-induced myelosuppression in adult patients when As Rick began the Q&A session, we'll follow the prepared remarks. Before we begin, I want to remind you that today's webcast contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements represent management's judgment as of today and may involve risk and uncertainty that could cause actual results to differ materially from those expressed in or implied by these statements.
Thank you Rebecca.
Everyone and welcome to the G. One conference call to discuss our fourth quarter and full year 2000, 22023 financial results and business update.
The press release on these financial results was issued this morning and can be found in the news section of our corporate website Chemotherapies Dot com.
This morning's call the team will provide a business overview of the 2023 fourth quarter and full year, including an update on our clinical programs and our commercial progress in that period with herself, which is approved and commercially available could decrease the incidence of chemotherapy induced myeloid suppression and adult patients were administered prior to a platinum.
Containing regimen or chicken containing regimen for extensive stage small cell lung cancer.
As Rick mentioned, a Q&A session will follow the prepared remarks.
Before we begin I want to remind you that today's webcast contains forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.
Such statements represent managements judgment as of today and May involve risks and uncertainties that could cause actual actual results to differ materially from those expressed in or implied by these statements.
William C. Roberts: For more information on such risk and uncertainties, please refer to our filings with the Securities and Exchange Commission, which are available from the SEC or on our corporate website. Any forward-looking statements represent our views as of today, February 28, 2024. Joining me on the call today are Jack Bailey, our Chief Executive Officer; Andrew Perry, our Chief Commercial Officer; Raj Malik, our Chief Medical Officer; and John Umstead, our Chief Financial Officer. That'll turn the call over to Jack.
More information on such risks and uncertainties. Please refer to our filings with the Securities and Exchange Commission, which are available from the SEC or on our corporate website.
Any forward looking statements represent our views as of today February 2028 February 28 2024.
Joining me on the call today are Jack Bailey, our Chief Executive Officer Andrew.
Andrew Perry, our Chief Commercial Officer, Raj Malik Chief Medical Officer, and John <unk>, Our Chief Financial Officer.
With that I'll turn the call over to Jack.
Jack Bailey: Thanks, Will. Good morning, everyone, and thank you for joining us on the call today. From a commercial perspective, as you'll hear from John and Andrew, we experienced strong Cosella growth in the fourth quarter of 2023, including revenue and biovolume growth of 29% and 19%, respectively. Thanks to this progress, and that which we expect in 2024, we have provided full year 2024 net product sales guidance of between 60 and 70 million. That said, as we discuss the milestones we have achieved during the fourth quarter, it's essential we continue to look forward to and prepare for the opportunities ahead, namely that of category leadership in triple negative breast cancer if we are successful in our clinical program. First, as you'll hear from Raj, the final results from our ongoing Phase 3, Preserve 2 trial of trilocycline in a metastatic setting are expected in the third quarter of this year.
Well good morning, everyone and thank you for joining us on the call today.
From a commercial perspective as Youll hear from John and Andrew We experienced strong solid growth in the fourth quarter of 2023, including revenue and bio volume growth of 29% and 19% respectively. Thanks.
Thanks to this progress and that which we expect in 2024, we have provided full year 2024, net product sales guidance of between 60 and $70 million.
That said as we discuss the milestones we have achieved during the fourth quarter. It's essential we continue to look forward to and prepare for the opportunities ahead.
That category leadership in Triple negative breast cancer, if we are successful in our clinical programs.
As Youll hear from Raj the final results from our ongoing phase III preserve two trial a trial was cycling in the metastatic setting are expected in the third quarter of this year.
Jack Bailey: Given our statistical boundaries, if our trial is successful in generating results similar to that of our Phase 2 trial, they would be among the most important data generated in the first-line metastatic setting in both CDL1-positive and negative tumors to date. Beyond that, the use of antibody drug conjugates, or ADCs, is becoming commonplace in the second line and later TMDC treatment settings, in addition to other tuberculosis.
Given our statistical boundaries for trial was successful in generating results similar to that of our phase II trial, they would be among the most important data generated in the first line metastatic setting in both PD lone positive and negative tumors to date.
Beyond that the use of antibody drug conjugates or adcs is appropriately becoming commonplace in the second line and later PBC treatment settings. In addition to other tumor types.
Jack Bailey: We have shown promising benefits thus far in our ongoing Phase 2 trial when trilocyclic acid is combined with a Trope 2 ADC, including improvements in tolerability and, more recently, in initial overall survival. We expect updated results from that trial by mid-year. With these and other recent results, we believe that continued clinical success in these trials could position G1 for category leadership across the spectrum of TMBC, in addition to our work in extensive stage small cell lung cancer.
We have shown promising benefits thus far in our ongoing phase II trial with private cyclic is combined with a trop two ADC.
Improvements in Tolerability and more recently, an initial overall survival.
We expect updated results from that trial mid year.
With these and other recent results. We believe that continued clinical success in these trials could position <unk> for category leadership across the spectrum of <unk>.
In addition to our work in extensive stage small cell lung cancer.
Jack Bailey: On today's call, Andrew will cover our recent commercial results, Raj will provide an update on our clinical pipeline, including our progress toward final results with our Phase 3 Preserve II trial, John will then discuss the financial results for the quarter as well as our 2024 guidance, and I'll be back with some concluding comments. With that, I'll turn the call over to Andrew.
On today's call Andrew will cover our recent commercial results Raj will provide an update on our clinical pipeline, including our progress toward final results with our phase III preserve two trial.
John will then discuss the financial results for the quarter as well as our 2024 guidance finally ill be back with some concluding comments with that I'll turn the call over to Andrew. Thank you Jack I'm glad to be with you today to provide an update on our fourth quarter 2023 sales performance and the significant progress we've made in our commercial execution over recent months.
Andrew Perry: Thank you, Jack. I'm glad to be with you today to provide an update on our fourth quarter 2023 sales performance and the significant progress we've made in our commercial execution over the recent months, having navigated a period of slower growth during the national platinum chemotherapy shortage last year. Our goal in Q4 was to restore the momentum we had built early in the year, which had been interrupted by supply disruptions of carboplatin and cisplatin during Q2 and Q3. We were able to achieve this goal and continue to demonstrate a broader platform of deeply adopting customer organizations. Beginning with sales results, we ended the quarter with 19% overall vial volume growth compared with Q3 2023. Additionally, all three of our sales regions generated double-digit volume growth in the fourth quarter.
Having navigated a period of slower growth during the national platinum chemotherapy shortage last year.
Our goal in Q4 was to restore the momentum we have built early in the year that have been interrupted by supply disruptions of carboplatin or cisplatin during Q to Q2, and Q3, we weren't able to achieve this goal and to continue to demonstrate a broader platform of deeply adult customer organization.
You're getting the sales results, we ended the quarter with 19% overall, while volume growth compared with Q3 2023.
All three of our sales regions generated double digit volume growth in the fourth quarter.
Andrew Perry: Focusing on the top 100 customer organizations, which represent around half the volume opportunity in the market, our growth was higher at 24% in the segment, and we added two new top 100 customers during Q4, meaning 75 of the top 100 have ordered Cosella for launch today. In the quarter, our efforts to grow in the top 100s were supported by our new strategic accounts team, who are equipped with our latest real-world evidence data and are focused on creating systematic growth in our largest customers. As a result, our top 100 customers composed 58% of our total volume in the quarter. Community clinics and hospitals grew over 20% during Q4 and represented just over 80% of sales, with the remainder being in academic centers. Our fastest-growing segment during the quarter was customers covered by volume-based contract agreements. Contract customers grew 28% during the quarter and made up around a third of our overall volume.
Focusing on the top 100 customer organizations, which represent around half the volume opportunity in the market our growth was higher at 24% in the segment and we added two new top 100 customers. During Q4, meaning 75 of the top 100 of article setup launched today.
A quarter of our efforts to grow and top one hundreds were supported by our new strategic accounts team for our flex with our latest real world evidence data and are focused on creating system market growth and our largest customers and as a result top 100 customers composed 58% of our total volume in the quarter.
Community clinics and hospitals grew over 20% during Q4 and represented just over 80% of sales with the remainder being in academic centers.
Our fastest growing segment during the quarter was in customers covered by volume based contract agreement contracted customers grew 28% during the quarter and made up around a third of our overall volume.
Andrew Perry: We continue to see a broader base of adoption, with 55 new accounts and almost 30 customers ordering 100 or more vials in Q4. Our estimate of Cosella patient share continues to grow, and although claims data for Q4 are not fully available, we estimate patient share of over 13% in the first-line market, demonstrating that there remains significant opportunity for growth. Ninety-seven percent of our volume in the quarter was in commercial supply, with three percent provided through our patient assistance program. Our payer mix remains stable, with the majority covered by Medicare, and third-party payer reimbursement has remained strong. Moving into Q1 2024, we have embedded our new strategic accounts capabilities, we continue to pursue new contract customer opportunities, and we've already seen our highest month ever for both volume and ex-factory sales in January, giving us confidence of continued growth going forward. I'll now pass the call over to Rajesh.
We continue to see a broader base of adoption with 55, new accounts and almost 30 customers ordering 100 or more miles in Q4.
Our estimate of cross sell of patient share continues to grow.
Full claims data for Q4 are not fully available we estimate patient share of over 13% in the first line market demonstrating that there remains significant opportunity for growth.
97% of our volume in the quarter within commercial supply of 3% provided through our patient assistance program. Our payer mix remained stable with the majority of covered by Medicare and third party payer reimbursement has remained strong.
Moving into Q1 2024, we have amended our new strategic accounts capabilities, we continue to pursue new contract customer opportunities and we've already seen our highest months ever for both volume and ex factory sales in January.
Confidence of continued growth going forward I'll now pass the call over to Roger.
Rajesh K. Malik: Thanks, Andrew, and good morning, everyone. I'll start with a reminder of recent progress in our phase three preserved food trial in metastatic triple negative breast cancer. Earlier this month, we announced that the Independent Data Monitoring Committee for the trial reviewed data from the interim analysis of overall survival and recommended that the trial continue to the final analysis, which will be conducted on the intent-to-treat, or I2T, population. Importantly, the DMC did not express any concerns with the trial.
Thanks, Andrew and good morning, everyone.
I'll start with a reminder of recent progress that our phase III <unk> trial in metastatic triple negative breast cancer.
Earlier this month, we announced that the independent data monitoring committee for the trial reviewed data from the interim analysis of overall survival and recommended that the trial continue to the final analysis, which will be conducted on the intent to treat or ITT population.
Importantly, the DMC did not express any concerns that the trial and as a reminder, <unk> remains blinded to all data.
Rajesh K. Malik: And as a reminder, G1 remains blinded to all data. However, we continue to be confident in the ability of tricyclists to achieve a positive outcome for a variety of reasons. First, there is a greater likelihood of achieving a positive outcome at the final analysis and at the interim because there are a larger number of events and a higher alpha allocation at the final analysis. This results in the ability to detect a larger critical hazard ratio at the final analysis compared to the inference. We discussed on the last call that the critical hazard ratio was 0.61 at the introduction. In the final analysis, we'll be able to pick up a larger hazard ratio of 0.67. And, of course, second, the strength of the data that precedes this trial provides additional confidence.
We continue to be confident in the ability of <unk> to achieve a positive outcome for a variety of reasons.
First there is a greater likelihood of achieving a positive outcome at a final analysis and at an interim because there are larger number of events and a higher alpha allocation at the final analysis.
This results in the ability to detect a larger critical hazard ratio at the final analysis compared to the interim.
We discussed on the last call at the critical hazard ratio was <unk> 61 at the interim.
And the final analysis will be able to pick up a larger hazard ratio of 0.67.
And of course second the strength of the data that precedes this trial provides additional confidence.
Rajesh K. Malik: We frequently describe the Phase 2 trial, in which we saw statistically significant improvements in median overall survival in patients receiving trial acyclib prior to gemcitabine carboplatin compared to those receiving chemotherapy alone. Importantly, the Kaplan-Meier survival curves of trial participants receiving tralacyclib plus gemcitabine carboplatin continue to separate over time compared to participants receiving placebo prior to their chemotherapy, specifically for patients with PD- This is particularly relevant as the enrollment period for PRESERVE-2 was from June 2021 until October 2022, and the interim analysis, in February 2024, was conducted approximately 15 months after the last patient was enrolled. Therefore, the additional months of follow-up between the interim and final analyses could be important for the curves to continue to meaningfully separate.
We frequent frequently describe the phase II trial in which we saw statistically significant improvements in median overall survival in patients receiving <unk> prior to Jim side of <unk> Carboplatin.
Compared to those receiving chemotherapy alone.
Accordingly, the Kaplan Meier survival curves of trial participants, receiving <unk>, plus gemcitabine and Carboplatin continue to separate over time compared to participants receiving placebo prior to their chemotherapy.
Particularly for patients with PD lone negative tumors.
Prepare separation didn't occur until approximately 15 months.
This is particularly relevant as the enrollment period.
But preserve too.
June 2021 until October 2022, and.
In the interim analysis in February 2024.
Let's conducted approximately 15 months after the last patient was enrolled.
Therefore, the additional months of follow up between the interim and final analyses.
Would be important for the curves to continue to meaningfully separate.
Rajesh K. Malik: Equally compelling were the results that we presented in December last year at the San Antonio Breast Cancer Symposium regarding subsequent anti-cancer therapy use among patients that participated in the Phase 2 TMBC trial. Participants who received trialocyclic with gencytobine carboplatin and then received subsequent anti-cancer therapy after trialocyclic discontinuation exhibited clinically meaningful improvements in overall survival, with medians of 32 months versus 12.8. These results were statistically significant with a p-value of 0.001. Furthermore, median overall survival for patients who received trialocyclic was 14 months from the time they started their first subsequent therapy, compared to 5.8 months for patients who did not receive prior trialocyclic. The p-value for this analysis was also 0.001. These results show that trilocyclic can provide benefits during its administration with chemotherapy in the short term and additional benefits after trilocyclic discontinuation by improving long-term immune surveillance.
Equally compelling where the results that we presented in December last year at the San Antonio breast cancer Symposium regarding subsequent anti cancer therapy use among patients that participated in the phase II <unk> trial.
Participants who receive counter cyclic with Gemcitabine Carboplatin and then received subsequent anti cancer therapy after <unk> discontinuation exhibited.
Clinically meaningful improvements in overall survival.
With medians of 32.
A $32 seven months versus 12 eight months.
These results were statistically significant with a P value of 0.001.
Further median overall survival for patients who receive trailer cycle. It was 14 months from the time. They started their first subsequent therapy compared to $5 eight months for patients who did not receive prior travel cycling.
The P value for this analysis was also 0001.
These results show that <unk> can provide benefits during the administration with chemotherapy in the short term and additional benefits after trial sites have discontinuation by improving long term immune surveillance.
Rajesh K. Malik: Given that femoralizumab achieved a hazard ratio of 0.89 in the ITT population in the Keno-355 trial, achieving our boundary hazard ratio of 0.67 would mark the biggest improvement in overall survival seen in first-line metastatic triple negative breast cancer to date. We look forward to the final results, which are estimated to be in the third quarter of this year. Regarding our Phase II trial of phthalocyte live in combination with TROP2ADC Salsatuzumab Govatikam, In January, we described promising initial efficacy results, including meaningful improvements in median overall survival among patients receiving Phyllis Feichler compared to historical results for the ADC alone.
Given that <unk> achieved a hazard ratio of <unk> 89 in the ITT population and the keynote 355 trial.
<unk>, our boundary hazard ratio of.
067 would mark the biggest improvement in overall survival seen in first line.
Metastatic triple negative breast cancer to date.
We look forward to the final results, which are estimated to be in the third quarter of this year.
Regarding our phase III trial of <unk> in combination with the trop, two ADC substitutional outgrow boutique count.
In January we described promising initial efficacy results, including meaningful improvements in median overall survival among patients receiving <unk>.
Got a cyclist compared to historical results for the ADC alone.
Rajesh K. Malik: We expect to provide updated overall survival results mid-year. Assuming the updated results remain strong, we anticipate continued partnership interest in developing trilocyclic with TROP2 ADCs that are in various stages of clinical development in TMBC and beyond. Additional clinical trials are ongoing, along with tracking real-world data, to evaluate whether trialocyclic may also improve survival in extensive stage small cell lung cancer.
We expect to provide updated overall survival results mid year.
Assuming the updated results remained strong we anticipate continued partnership interest in developing <unk> with trop two adcs that are in various stages of clinical development and TWC and beyond.
Additional clinical trials are ongoing along with tracking real world data.
So evaluate where the trailer cycle and they also improve survival and extensive stage small cell lung cancer.
Rajesh K. Malik: A potential overall survival benefit, if demonstrated, would supplement the already known tricyclic benefits of milder protection and reductions in hospitalizations and associated. These ongoing survival studies and analyses in small cell lung cancer include, This is a post-marketing study of Trollis 5-plate part at Topo Tecan in approximately 300 patients. The real-world evidence we continue to generate, the most recent cut of which was presented in October at the ASCO Quality Care Symposium, and a Phase II investigator-initiated trial at UNC-Leinberger in combination with lorbanectin, which according to the study investigator continues to look promising from the perspective of both model protection and tumor response. However, our near-term clinical focus for the next six months will remain on advancing the science in triple-negative breast cancer as we deliver the TMBC-ADC Phase II results mid-year and the Phase III final results in the third quarter.
A potential overall survival benefit as demonstrated.
With supplement the already known trial cycle benefits of Mila protection and reductions in hospitalizations and associated costs.
These ongoing survival studies and analyses in small cell lung cancer include.
The post marketing study of Carlos cyclic part itself, the pecan and approximately 300 patients.
The real World evidence, we continue to generate the most recent cutoff, which was presented in October at the <unk> quality cash symposium.
And a phase two investigator initiated trial at UNC Leinberger in combination with <unk>, which according to the study investigator.
You can use to look promising from the perspective of both model protection antitumor responses.
However.
Our near term political focus over the next six months, we remain on advancing.
The science and triple negative breast cancer as we deliver the <unk> ADC phase II results mid year and the phase III final results of the third quarter.
Rajesh K. Malik: With that, I'll turn the call over to John for the financial response. Thanks, Raj, and good morning, everyone. As Will mentioned, full financial results for the fourth quarter and full year 2023 are available in this morning's press release and will be in the 10K, which we expect to file at the market close. Net sales of Casella grew 29% in the fourth quarter of 2023 to $13.9 million, compared to 19% quarterly volume growth. This disparity is largely related to the timing of the sales.
With that I'll turn the call over to John for the financial results.
Thanks, Raj and good morning, everyone as will mentioned full financial results for the fourth quarter and full year 2023 are available in this morning's press release and will be in the 10-K, which we expect to file after market close.
Net sales of <unk> grew 29% in the fourth quarter of 2023 to $13 9 million.
Compared to 19% quarterly valve volume growth.
This disparity is largely related to the timing of the sales as mentioned on our November call, we recognize revenue upon delivery to distributors.
John Demaree: As mentioned on our November call, we recognize revenue upon delivery to distributors. We experienced an increase in patient valve demand towards the end of the third quarter of 2023, which was recognized as revenue in the fourth quarter, in addition to that, which we recognize due to strong quarter-over-quarter growth. Our total revenue for the fourth quarter of 2023 grew 45% over the fourth quarter of 2022 to $14.9 million, comprised of the $13.9 million I just described in net Casella revenue and $1 million in licensed revenue. This compares favorably to the $10.3 million in total revenue, including $8.9 million in product revenue, in the fourth quarter of 2022. Total revenues for the full year 2023 were $82.5 million, including net revenue of $46.3 million and license revenue of $36.2 million. For the full year 2022, total revenues were $51.3 million, including net product revenue of $31.3 million. Cost of goods sold for the fourth quarter of 2023 was $1.3 million compared to $1 million for the same period in 2022. Cost of goods sold for the full year 2023 was $7.2 million compared to $3.7 million for the prior year.
We experienced an increase in patient vial demand towards the end of the third quarter of 2023, which was recognized as revenue in the fourth quarter. In addition to that which we recognized due to strong quarter over quarter growth.
Our total revenue for the fourth quarter of 2023 grew 45% over the fourth quarter of 2022 to $14 $9 million comprised of a $13 9 million I, just described and that casella revenue and $1 million of license revenue.
This compares favorably to the $10 $3 million in total revenue, including $8 $9 million in product revenue in the fourth quarter of 2022.
Total revenues for the full year, 2023% to $82 $5 million, including.
Net revenue of $46 $3 million in license revenue of $36 2 million.
Full year 2022, total revenues were $51 $3 million, including net product revenue of $31 3 million.
Cost of goods sold for the fourth quarter of 2023 was $1 3 million compared to $1 million for the same period in 2022.
Cost of goods sold for the full year 2023 was $7 2 million compared to $3 7 million for the prior year.
John Demaree: As we guided in November, our operating expenses of $122 million in 2023 were 35% lower than the $187.5 million in OPEX in 2022. Research and development expenses for the fourth quarter of 2023 were $7.4 million, compared to $16.6 million for the same period in 2022. The decrease was primarily due to lower clinical program costs. R&D expenses for the full year 2023 were $43.7 million compared to $83.3 million for 2022, and selling general and administrative expenses for the fourth quarter of 2023 were $15.2 million compared to $23.6 million for the fourth quarter of 2022. The decrease in SG&A expenses was primarily due to decreases in personnel costs and medical affairs and further optimization of our commercialization activities. SG&A expenses for the full year 2023 were $71.1 million compared to $100.4 million for the prior year.
As we guided in November our operating expenses of $122 million in 2023, or 35% lower than the $187 5 million in Opex in 2022.
Research and development expenses for the fourth quarter of 2023 were $7 4 million compared to $16 6 million for the same period in 2022. The decrease was primarily due to lower clinical program costs.
R&D expenses for the full year 2023 were $43 7 million compared to $83 $3 million for 2022.
Our selling general and administrative expenses for the fourth quarter of 2023 were $15 2 million.
Compared to $23 6 million for the fourth quarter of 2022.
The decrease in SG&A expenses was primarily due to decreases in personnel costs and medical affairs and further optimization of our commercialization activities.
SG&A expenses for the full year 2023 were $71 1 million compared to $104 million for the prior year.
John Demaree: Regarding our cash position, we ended the fourth quarter with cash, cash equivalents, and marketable securities of $82.2 million compared to $145.1 million as of December 31, 2022. Finally, regarding revenue and cash runway guidance for the full year 2024. As Jack mentioned, we expect net Casella revenue to be between $60 million and $70 million for 2024. There is no change to our 2024 gross net expense percentage estimate.
Regarding our cash position, we ended the fourth quarter with cash cash equivalents and marketable securities of $82 2 million compared.
Compared to $145 $1 million as of December 31, 2022.
Finally regarding revenue and cash runway guidance for the full year 2024.
As Jack mentioned, we expect net to sell our revenue to be between $60 million and $70 million for 2024.
There is no change to our 2020 for gross to net expense percentage estimates.
John Demaree: We expect a 2024 year cash, cash equivalents, and marketable securities balance of between $50 to $60 million. Additionally, we will continue to look for ways to optimize our cost structure in the near term with targeted headcount reductions outside of the commercial organization and identifying other potential efficiency improvements where appropriate. And based on the foregoing, we expect that our cash runway will take us into 2025. With that, I'll turn the call back over to Jack for some closing comments. Jack?
We expect the 2020 for year end cash cash equivalents and marketable securities balance of between $50 million to $60 million.
Additionally, we will continue to look for ways to optimize our cost structure in the near term with targeted head count reductions outside of the commercial organization and identifying other potential efficiency improvements where appropriate.
And based on the foregoing, we expect that our cash runway will take us into 2025.
With that I'll turn the call back over to Jack for some closing comments.
Thank you John Raj, Andrew and well I also want to recognize the cancer community.
So for the opportunity to be part of your journey.
Jack Bailey: Thank you, John, Raj, Andrew, and Will. I also want to recognize the cancer community. We are thankful for the opportunity to be part of your journey. We are encouraged by the feedback we receive daily from physicians who rely on Cocella to reduce the chemotherapy-related myelosuppressive side effects in their patients with extensive stage small cell lung cancer and by the demand trajectory in Q4 2023 and the beginning of Q1 2024.
We are encouraged by the feedback we receive daily from physicians, who rely on cross sell it to reduce the chemotherapy related Milo suppressive side effects and their patients with extensive stage small cell lung cancer.
<unk> trajectory in Q4, 2023, and the beginning of Q1 2024.
While we have a strong commercial team driving <unk> penetration and demand.
And a clear path to profitability in this first indication. Our focus is also on generating the clinical results required for TWC category leadership.
To that end as you've heard today, we have important updated survival results from a phase two study in combination with a trop two ADC expected mid year and final results from our ongoing phase III trial in first line metastatic triple negative cancer expected in the third quarter of 2024.
Jack Bailey: And while we have a strong commercial team driving Cocella penetration and demand and a clear path to profitability in this first indication, our focus is also on generating the clinical results required for TMBC category leadership. To that end, as you've heard today, we have important updated survival results from our Phase 2 study in combination with the Trope 2 ADC expected mid-year, and final results from our ongoing Phase 3 trial in first-line metastatic triple-negative cancer expected in the third quarter of 2020. Thank you for your time this morning.
Thank you for your time. This morning, we will speak again in this format on the first quarter of 2024 call and made to see many of you at the spring investor meetings with that I'll turn it over to Q&A. Operator would you. Please remind our listeners how to ask your question.
Thank you at this time as you mentioned, we will conduct a question and answer session. As a reminder to ask a question you will need to press star one on your telephone and wait for your name to be announced.
Operator: We will speak again in this format on the first quarter 2024 call in May and see many of you at the Spring Investor Meeting. With that, I'll turn it over to Q&A. Operator, would you please remind our listeners how to ask a question?
Draw. Your question. Please press star one again.
Please standby, while we compile the Q&A roster.
Our first question comes from the line of Joseph Tung of TD Cowen. Your line is now open.
Operator: Thank you. At this time, as we mentioned, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced.
Hi, there good morning, and thank you for taking my question.
Maybe just just overall.
Initially the frontline CNBC data were delayed from sort of your very initial expectations, which I guess kind of suggests that the event rate is maybe occurring a little bit slower than initially anticipated and hopefully some of that is due to the addition of <unk>, but when you think about the comparator arm I guess is there anything over the past.
Joseph Sohm: To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Joseph Sohm of TD Coward. Your line is now open. Hi there, good morning.
Joseph Sohm: Thank you for taking my question. Maybe just just overall, I mean, initially, the frontline TMDC data were, you know, delayed from sort of your very initial expectations, which I guess kind of suggests that the event rate is, is maybe occurring a little bit slower than initially anticipated. And hopefully, some of that is due to the addition of Casella. But when you think about the comparator arm, I guess, is there anything over the past several years in particular that would have, you know, extended overall survival for the comparator? And what is sort of a good comparator for what that arm should do?
Several years in particular that would have.
Extended.
Overall survival for the comparator and what is sort of a good comparator for what the army should do is 355, the best obviously its on your face.
And that includes a few patients in later lines and then <unk>.
On the commercial side.
That 13% penetration in front line.
Seems it seems really strong I guess, how high do you think penetration can go on the frontline.
Joseph Sohm: Is 355 the best? Obviously, we saw your phase two data, but that includes a few patients in later lines. And then second, on the commercial side, that 13% penetration in the frontline seems really strong. I guess, how high do you think penetration can go on the frontline? And are those the same?
And are these the same are these accounts that have the most experience with casella do they start later line and go forward or kind of who is using it and the hotline. Thank you.
Thanks, Joe why do we have Roz take the first one and then we'll have Andrew answer the second Raj, Yes, Hey, Joe Yeah, I mean in terms of comparator, we still think that the keynote 355 gem carbo arm is.
Joseph Sohm: Are these accounts that have the most experience with Casella? Do they start later in the line and go forward? Or kind of who's using it on the frontline?
Is a reasonable one because there aren't really any other data beyond that I mean, it's the most contemporary.
Joseph Sohm: Thank you. Thanks, Joe. Well, we have Raj take the first one, and then we'll have Andrew answer the second one. Raj. Yeah. Hey, Joe.
Data we have.
In terms of.
Things that could potentially be confounding. The one change of course, even since then as those likely greater ADC use, particularly in later lines of therapy.
Rajesh K. Malik: Yeah. I mean, in terms of comparing apples to apples, we still think that the Keynote 355 GEMCARBO arm is a reasonable one because there aren't really any other data beyond that. I mean, it's the most contemporary data we have.
In a blinded trial, we would expect that that would be relatively balanced between the two arms.
And so we would expect that trial out based on the prior data in terms of benefiting patients even with subsequent therapies will continue to show benefit when added to.
Rajesh K. Malik: I mean, in terms of things that could potentially be confounding, the one change, of course, even since then, is that there is likely greater ADC use, particularly in later lines of therapy. But in a blinded trial, we would expect that that would be relatively balanced between the two arms. And so, you know, we would expect that trial based on the prior data, in terms of benefiting patients even with subsequent therapies, will continue to show benefit when added to or rather when the ADC is given after trial. The 13% in first-line, so obviously, over 90% of our use is in that first-line setting, and we're talking about an overall market accessible to Cocella, which we estimate will be over $700 million in potential gross revenue We've seen that market share go up very consistently, even through the platinum shortage.
Or rather than the ADC is given after trial.
Interesting. Thanks, Phil So yeah. Thank you the 13% and for flying so obviously over 90% of our youth not first line setting.
And we're talking about an overall market here accessible to wholesale up which we estimate the over $700 million.
And potential gross revenue, so very very significant market opportunity for us.
We've seen that market share go up any consistently even through platinum shortage. Our market share continues to grow there were just fewer patients taking eligible chemotherapies, which makes sense. So we're very ambitious for what we can continue to add and not market share going forward than frankly, I won't be satisfied until every eligible patient as Gulf Coast Allen.
Perfect. Thank you very much.
One moment for our next question.
Our next question comes from the line of Gil Blum of Needham <unk> Company. Your line is now open.
Andrew Perry: Our market share continues to grow; there were just fewer patients taking eligible chemotherapies, which makes sense. So we're very ambitious for what we can continue to add to that market share going forward, and frankly, I won't be satisfied until every eligible patient has got Cocella. Perfect. Thank you very much.
Good morning, and thanks for taking our question.
Just a clarifying question.
<unk> look at the interim data the decrementals have been remedied.
Andrew Perry: One moment for our next question, which comes from the line of Gil Blum of Needham Company. Your line is now open. Good morning, and thanks for taking our question. Just a clarifying question. Did the IDMC look at the interim data? Did the committee have a remit to discontinue the study for futility? Yeah, hey, Gil. So the interim analysis was an efficacy one only, you know, obviously, if they saw the data, they could, of course, do additional analyses at their discretion. But the only analysis that was to be specified was one for Africa.
The study for futility.
Yes.
So the interim analysis was an efficacy one Ali.
Obviously, if they saw the data they could take it of course to do additional analyses at their discretion.
But the only analysis that was.
Sort of pre specified was one for efficacy.
Okay.
And maybe looking towards mid <unk> 24 for the A&D serious thoughts just set our expectations.
We could potentially see there.
Yes.
Yes, so obviously, what we're interested in seeing as we presented the early.
Gil Blum: And maybe looking toward mid-24 for the ADC results, just to set our expectations of what we could potentially see there. Thank you. Yeah, so obviously, what we're interested in seeing is, you know, we presented the early cut at the JPM. And so we'll be looking to see, you know, how the data, sorry, continue to track versus that. And, you know, if you recall that at 12 months, we had about a 20% improvement.
The J P. M. So we'll be looking to see how the data.
Sorry continue to track versus that.
And.
If you recall the at 12 months, we had about a 20% improvement.
Clearly the rest of the curve could change that.
Rajesh K. Malik: Clearly, the rest of the curve could change, but we're looking to see how much improved the survival is relative to historical data and then make decisions on further development, likely in a partnership scenario. One moment for our next question. Our next question comes from the line of Anupam Rama of J.P. Morgan. Your line is now open. Hi guys, this is Priyanka on behalf of Anupam.
We're looking to.
To see how much improve the survival is relative to historical data and then make decisions on further development likely in a partnership scenario.
One moment for our next question.
Our next question comes from the line of annual Panorama of Jpmorgan. Your line is now open.
Hi, guys. This is <unk> on for Anna We just had a quick question how much of the incremental headwind via the platinum shortage is assumed in the 2024 guidance for casella. Thank you.
Anupam Rama: We just have a quick question. How much of the incremental headwind via the platinum shortage is assumed in the 2024 guidance for Cofella? Thank you. So, Priyanka, can you repeat the question, please? Yeah, sure. But how much of the incremental headwind via the platinum shortage is assumed in the 2024 guidance for Cosella? Yeah, we don't assume if you're inflating any carry forward, we don't assume any. Given the limited duration therapy of these patients, along with the unfortunately, the diagnosis to expiration that you tend to see with this very aggressive cancer, we don't see that any of this sort of pushes patients into 2024.
So.
Priyanka can you repeat the question please.
Yeah sure so how much of the incremental head win via the platinum shortage is assumed in the 2024 guidance for Cassandra.
Yes, we don't assume if youre planning any carry forward, we don't assume any given the.
Limited duration therapy of these patients along with unfortunately.
The diagnosis to exploration that you tend to see what these this very aggressive cancer, we don't see that any of this sort of pushes patients into 2024.
Andrew Perry: What we are doing is certainly monitoring the FDA website to make sure that we don't see a repeat in 24 of what we saw in 23. And certainly at the clinic level, what we've heard from really late Q3 is that customers are not having issues being able to access any of the CARBO or CISP plates. Understood. Thank you so much.
We are doing this.
We are monitoring the FDA website to.
To make sure that it doesn't we don't see a repeat in 'twenty four what we saw in 2003 and certainly at the clinic level. What we've heard from really late Q3 is that customers are not having issue being able to access any of the carbo or cisplatin.
Understood. Thank you so much.
Andrew Perry: One moment for our next question. Our next question comes from the line of Laura Prendergast of Raymond James. Your line is now open.
One moment for our next question.
Our next question comes from the line of Laura Prendergast of Raymond James Your line is now open.
Laura Prendergast: Hey guys, thanks for taking the questions. I was wondering if you could elaborate a bit on, you know, if you do see mid-year, this ADC combo data, you know, still continuing to look strong, the timing of when you expect to initiate a randomized trial. And then additionally, on your cash runway, does that include baked-in launch costs for Preserve 2 if the final analysis is successful and Phase 3 for the ADC combination? Thanks. So, I'll have John pick the last one and then we can flip over to Raj. Yeah, sorry.
Hey, guys. Thanks for taking my question.
I was wondering if you can elaborate a bit on.
So you do see midyear this ADC combo data.
Contains looks strong the timing of when you expect to initiate a randomized trial.
And then additionally on your cash runway.
Does that include baked and launch costs represent the final analysis.
And the phase III for the ADC combination thanks.
So I'll have John take the last one I know, we can flip over to Raj.
Yes.
John Demaree: For the cash runway part, you know, from a PNBC launch cost, we do have those inclusive of it. Obviously, with the delay to interim, those costs get pushed out, but we do have them baked in to our runway.
Sorry.
For the cash runway part from a <unk> launch costs, we do have those inclusive of it obviously with the delay to interim those costs get pushed out, but we do have them baked in in our runway you mentioned I believe in ADC phase III randomized trial, we do not have that in there I think as Raj mentioned, we want to see our mid year results.
John Demaree: You mentioned, I believe, an ADC Phase 3 randomized trial. We do not have that in there. I think, as Raj mentioned, we want to see our mid-year results and then, hopefully, have the ability to partner with some type of collaboration, potentially, where we would look at a Phase 3 trial. Great, thank you. Go ahead, Raj.
And then hopefully have the ability to partner with.
With some type of collaboration potentially where we would look at our phase III trial.
Great. Thank you.
Got it guys.
Rajesh K. Malik: No, I was just going to, I think John covered it, unless you have an additional question. I know that's all for me. Thank you. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. One moment for our next question, which comes from the line of Ed White of H.C. Wainwright. Your line is now open. Hey guys, thanks for taking our question. This is Steve, speaking on behalf of Ed. First question, do you think Salesforce is the right size now? or Would you need additional investments?
No I was going to just I think John covered it unless you.
You have an additional question.
And Thats all for me. Thank you.
Thank you Laura.
As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced one moment. Our next question.
Our next question comes from the line of Ed White.
H C. Wainwright your line is now open.
Hey, guys. Thanks for taking our question. This is Steve on for Ed.
First question do you think the sales force is right sized now.
Or would you need additional investments and if so.
Steve: And if so, how should we think about SG&A for next year or this year? Why don't we go first with Andrew on the sales force, and then John can touch on SG&A going this year. Yeah, thanks, Steve. You know, we continue to make tweaks to our, I would say, commercial footprint in the field. And one example is our new strategic defense team that we deployed in Q4 and into Q1. And we've been delighted with the progress they've made so far. We think our commercial footprint in terms of sales professionals right now is about right. I think as we move forward into market expansion, into new indications, we will reevaluate that. But I don't see it being like a real phase shift.
How should we think about SG&A for next year or this year.
So why don't we go first with Andrew on the Salesforce and then John can touch on the ESG leader. This year. Okay. Thanks, Steve we continue to make tweaks to our I would say our commercial footprint in the field and one example is our new strategic accounts team that we deployed in <unk>.
Q4 and into Q1, we've been delighted with the progress they've made so far.
We think our commercial footprint in terms of sales professionals right.
That's about right I think as we move forward into market expansion into new indications, we would reevaluate, but I don't see it being like a real phase shifts I see it being an evolution of the team that we have.
Andrew Perry: I see it being an evolution of the team that we have, and from an FG&A call center. Steve, from an SG&A cost perspective, I think you had asked about that. I mean, we continue to invest in commercial, as we always have. As I mentioned earlier, we do continue to see efficiencies in optimizing that cost structure on the commercial front, but we continue to invest in it.
And from other cash G&A cost.
Steve from an SG&A cost perspective, I think you had asked about that I mean, we continue to invest in commercial as we always have as I mentioned earlier, we did create have continued to see efficiencies and optimizing that cost structure of the commercial fronts, but we continue to invest in it.
John Demaree: Okay, thanks. And then, is there any update on SimCir in China? No, I mean, they're obviously continuing to sell Coacella for the initial indication in small cell there also, and they're also running their own studies, and they've been a wonderful partner to us and will continue to be that to this day.
Okay. Thanks.
And then is there any update on <unk> in China.
No.
We obviously are continuing to sell cross sell out for the initial limitation on small cell there also in there.
Also running their own studies.
They've been a wonderful partner to us to continue to be to add to this day. So.
Jack Bailey: So, no updates beyond that. All right, thank you. I am showing no further questions at this time. I would now like to turn it back to Jack Bailey, Chief Executive Officer, for closing remarks. Thank you, operator. As always, I look forward to keeping everyone updated on our progress going forward. Thank you for joining us today, and we'll be in touch. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.
No updates beyond that.
Alright, thank you.
Im showing no further questions at this time I would now like to turn it back to Jack Bailey, Chief Executive Officer for closing remarks.
Thank you operator, and as always I look forward to keeping everyone updated on our progress going forward. Thank you for joining us today and we'll be in touch. Thank you.
Thank you for your participation in today's conference. This does conclude the program you may now disconnect.
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