Q3 2024 BioCryst Pharmaceuticals Inc Earnings Call
Yeah.
Good day and welcome to the Biocryst third quarter 'twenty 'twenty four earnings call. All participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions.
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Please note this event is being recorded.
Speaker Change: I would now like to turn the conference over to John Bluth, Chief Communications Officer. Please go ahead.
Okay.
Thanks, Dave Good morning, and welcome to Biocryst third quarter 2020 for corporate update and financial results Conference call. Today's press release and accompanying slides are available on our website.
Speaker Change: Participating with me today are CEO Jon Stonehouse.
Speaker Change: So Anthony Doyle, Chief Commercial Officer, Charlie Gayer, Chief R&D Officer, Dr. Helen decorate and Chief data and insights officer Jinky Rosselli. Following our remarks, we'll answer your questions. Today's conference call will contain forward looking statements, including those statements regarding future results are unaudited and forward looking financial information as well as the Companys future performance and are achieved.
Speaker Change: These statements are subject to known and unknown risks and uncertainties, which may cause our actual results performance or achievements to be materially different from any future results or performance expressed or implied in this presentation.
Speaker Change: Should not place undue reliance on these forward looking statements for additional information, including a detailed discussion of our risk factors. Please refer to the company's documents filed with the Securities and Exchange Commission, which can be accessed on our website. In addition to today's conference call includes non-GAAP financial measures for a reconciliation of these non-GAAP measures against the most directly comparable GAAP financial measure please refer to the earnings.
Speaker Change: Press release posted in the press release section of our Investor Relations website at Www Dot Biocryst Dot Com I would now like to turn the call over to Jon Stonehouse.
Speaker Change: John our third quarter performance is remarkable on multiple fronts first growing orla Dale quarterly revenue year over year by nearly 36% now four years from approval is amazing.
Speaker Change: This is a result of growing confidence in her therapy, where physicians are seeing that Orla day offers many of their patients both outstanding efficacy and convenience.
Speaker Change: Next advancing Bcf 17, 725 for Netherton syndrome into the clinic is exciting, especially considering there is nothing to treat the underlying cause of this disease.
Speaker Change: And finally being able to do all of this and moved closer to sustainable profitability supports that we are building a company with the potential for durable growth that's been our goal and it's great to see it coming together quarter after quarter after quarter.
So today, Charlie will share more about our performance with all the data and how it continues to reinforce and grow our confidence in the path to $1 billion at peak, even in an increasingly crowded mark.
Speaker Change: Alan will share how there's more potential with orla Dale by expanding the label to younger children and starting a phase four study to help physicians and patients learn more about the best ways to switch therapies.
Speaker Change: She will also share the importance of moving into the clinic with B C 17, and 725 for patients living with another Gen syndrome.
Speaker Change: And Anthony will wrap up by sharing how our financial position gets stronger and stronger and we are well on our way to our commitment of achieving sustained profitability with that I'll turn it over to Charlie.
Charlie Gayer: Thanks, Sean we had another great quarter for early days with $116 $3 million in global revenue and nearly 36% year over year growth in year for prescribers.
Charlie Gayer: Prescribers and patients are increasingly convinced that Orlando delivers outstanding efficacy as well as convenience. We added 67, new U S prescribers in the quarter one of our best quarters in the last two years and new prescriptions came in at the same elevated rate. We have now seen for 12 months straight.
Charlie Gayer: In fact U S start forms over the past 12 months are up almost 15% compared to the prior 12 months.
Charlie Gayer: As far as improving pain therapy, we are ahead of plan.
I've described before that our goal is to hold the paid rate steady in the second half of the year, while advancing in the first half.
Speaker Change: So it's great news that we improved the paid rate by almost half a percent to 74, 8% compared to a drop of 2% in the third quarter last year.
Speaker Change: The commercial paid rate held steady at 82% and the Medicare rate ticked up 3% to 55%.
Speaker Change: This progress increases our confidence they will we will reach our goal of 85% paid overall and we expect to take another big step in that direction in the first half of 2025.
With a strong demand and improved paid rate we are tightening our revenue guidance for 2024 to $430 million to $435 million the upper end of our prior range.
Speaker Change: Orlando has been on the market for almost four years, and we have accumulated a large and growing body of real world evidence that is reinforcing prescribers views about the product while driving growth.
Speaker Change: Last week at the AC AI conference, we presented two posters showing significant and sustained real world attack reductions in over 450 patients with type one or type two HAE and over 350 patients with HAE with C. One normal inhibitor.
These are unprecedented patient numbers for evidence reported on Neha Profi therapy.
The type one and two patients reported experiencing a median rate of just one third of an attack per month, that's only four attacks per year.
Speaker Change: For patients. This is what great attack control looks like.
Speaker Change: And as we described last quarter three out of four patients in our market Research Studies report their attacks are less severe on Orla Dale.
Speaker Change: The C. One normal inhibitor patients reported median rates of less than an attack per month down from over three per months before starting orla down.
See what normal patients typically have struggled for years to find an effective therapy and were glad that so many are benefiting from orla Dale.
Speaker Change: We also presented a poster last week confirming high patient retention on oral Dale.
Speaker Change: Alex This a payer claims showed that patients starting orla Dale tax iroh or Haegarda has similar one year adherence around 60%.
Speaker Change: The analysis also showed that for patients with at least two fills of their prescription one year adherence was 71% for early Dale and 63% for the other two products.
Speaker Change: No <unk> therapy is perfect for every patient, but these data make sense if a patient if patients are experiencing just a few attacks per year on an oral once daily therapy.
Speaker Change: Why wouldn't they remain on oral a day of long term.
Speaker Change: That long term stickiness is what our market research and predictive modeling show, even when accounting for the launch of several new <unk> therapies in the coming years.
Speaker Change: As described on slide nine we conduct a comprehensive annual exercise, including a conjoined preference study of 175, HAE Treaters 100, HAE patients and over 50 payers followed by running a Monte Carlo model with 6000 stimulated interactions between patients.
Physicians and payers, that's a really big number for a market that had about 8500 diagnosed untreated patients in 2023.
Speaker Change: Those 6000 stimulations account for the many dynamics that affect treatment choice such as product preference frequency of visits to physicians and future product launch dates.
To assess treatment preference, we show respondents the best case product profiles for potential new competitors, but our conservative about the profile we show for oral DAU. Despite the real world attack control that we're seeing.
Speaker Change: The results of this exercise has been consistent over the past three years, even as we add information about potential competitors and include new cohorts of physicians and patients and the market research every year.
Speaker Change: In our <unk>.
Speaker Change: Our most recent run showed on slide 10 reinforced what we have seen before this comprehensive research and modeling predicts that Orlando will reach and maintain a steady state of over 2000 patients. After 2028, even as newly Ladakh are predicted to gain share in the overall market.
Speaker Change: We are very confident in what we've seen now and for the future of oil are down.
Speaker Change: That confidence comes from the huge volume of evidence that we've collected and will continue to collect.
Speaker Change: What we see is compound annual global revenue growth of nearly 20% through 2029, when we expect to reach $1 billion in annual revenue followed by up to a decade of stable and significant cash flow that will help fund our innovative pipeline.
Speaker Change: I'll turn it over to Helen to describe the recent and upcoming advances in that pipeline.
Speaker Change: Thanks, Charlie.
Helen: As both a pediatrician and apparent I'm incredibly proud that we're on track for regulatory submission for the first oral prophylactic therapy for children with H I E in 2025.
Helen: This is an incredibly important therapy that will change the lives of these children.
Helen: We know that this disease manifests in childhood and can be seen beginning at very young ages, and toddlers and school age children, recurrent swelling and unexplained pain, not only need urgent medical attention such as an emergency room visit or hospitalization, but also interrupted child's ability to learn play make friends.
Helen: An experienced a normal childhood.
Frequent unpredictable interruptions and family life and school are unfortunately, what's normal for these children, making the burden of disease, a real problem for them and their caregivers.
Helen: Treatment availability for children with H E has lagged behind out of adults.
Helen: The only prophylaxis is by injection and parents have to inject their child at home multiple times a month every month just to prevent acute attacks.
Imagine the burden it puts on the whole family parents face a dilemma and giving their child injections are exposing them to H HAE attacks.
Helen: We plan to change this completely with the new Orla day of granules.
Helen: They are about the size of the sprinkles. So they provide lots of options for younger children. These can be mixed and soft foods, such as chocolate pudding for easy dosing older Kids can put the granules into a glass of water or even directly in their mouth and wash it down with a drink that.
Helen: That ease of use alone will be transformative for many families.
So what comes next with the oil the day a pediatric program.
We reported earlier this year that enrollment in the apex study completed and now we've also completed the observations for the primary outcome, which is evaluation of exposure to the drug in these young patients they'll continue on drug and the analysis and upcoming regulatory submissions are underway.
Helen: Now I'll turn to the transition study to build more post market evidence for oil at al.
Speaker Change: It's Charlie described 52% of patients initiating orla do switch from another prophylactic therapy and the evidence shows they do very well.
Speaker Change: Physicians, often ask us about the best strategy for making the transition and to answer. This we've opened the phase four apex P study apex T study to collect data on the transition and rolling patients who've decided to switch.
Helen: The physician will determine how to manage the transition over a defined time period and this could involve switching immediately or having some overlap between the injectable prophylaxis in Orla Dale.
Helen: Goal is to understand how physicians are approaching the transition and to describe the post transition experience for patients.
Helen: We're confident this phase four study, we will provide more knowledge and experience supporting the decision for future patients to switch as well we're excited to get this started.
Helen: Now, let's turn to the pipeline.
Helen: I recently met a patient you described what it was like living with Netherton syndrome, with skin that shed and peeled off in big pieces from fingers arms and legs everyday at school work and social events.
This patient described the shame of being a young child on the first day at school when no one else in the class not even the teacher felt comfortable holding hands.
Helen: Today, there's no disease altering therapy available for another 10 syndrome.
Helen: Treatment is limited to supportive care involving topical treatment of the skin with cumbersome and messy ointments and creams to see with the scan and decrease the scaling.
Helen: The patient I met has learned to build this into a lifelong daily routine and even so continue to have such profound peeling and shedding of scan it was hard to face new social interactions.
Helen: I realized how much of a burden. This disease is every day, starting with early childhood and continuing through life.
Speaker Change: As reported in October we recently initiated dosing in a phase one healthy volunteer study for <unk> 17, 75, a potent <unk> inhibitor for the treatment of Netherton syndrome.
Helen: I'm proud to say that this is a huge milestone for patients and for Biocryst.
Helen: This marks the successful rapid delivery of our first protein therapeutic entered the clinic using our new protein platform technology to diversify and expand our pipeline capabilities.
Helen: And we're evaluating D. C 17, 75 is a functional replacement to correct for the missing protein right at the source for another 10 syndrome.
Helen: We're looking for a dramatic reduction in the symptoms of Itchiness flaking and peeling skin.
We plan to move quickly next year to patients to evaluate for exposure in the skin and ultimately to assess improvement and healing of the skin.
Helen: Finally, I'll turn to our next strategy coming to the clinic or oral stat being evaluated for treatment of diabetic macular edema.
Speaker Change: What is the effect of this disease.
Helen: Patients with diabetic macular edema progressively lose their vision is a result of the effects of diabetes, which causes leakiness and the blood vessels of the retina, resulting in an accumulation of fluid in his edina in the microscopic layers of the retina.
Helen: A patient might not recognize it as anything more than fun fuzziness in the vision that first with difficulty reading or focusing on small things over.
Over time, however, visual acuity is impaired and patients lose the ability to read drive into routine tasks.
Helen: Current treatment includes fair, Jeff inhibitors that slow the weakness of the retinal blood vessels and slow or decrease the accumulating edina.
Helen: At some point this therapy stops working patients lose their vision.
Recently plasma, California has been shown to contribute to the leasing of the retinal blood vessels and D. N E and we also know that getting adequate durable exposure to a drag at the retina is a critical step for efficacy.
Helen: We believe if oral stat plasma <unk> inhibitor is the right track to achieve this.
Helen: Our goal is to deliver of oral stat continuously by placing it adjacent to the retina, where it will slowly diffuse providing steady exposure lasting months.
Well no we've been successful if we see the macular edema decrease in the near term and ultimately visual acuity improves.
Helen: We look forward to initiating our first study of oral stat in patients with DMD in 2025.
Helen: So in summary in 2025, we will have two new programs dosing in patients Netherton syndrome, and Danny with initial data by the end of the year.
Helen: And now I'll turn the call is Anthony.
Anthony: Thanks Alan.
Anthony: It's great to see that in addition to Orlando, having another really impressive quarter. We're also making significant progress on the development side, all while continuing along our path to profitability.
You can find our detailed third quarter financials in today's earnings press release, and I'd like to call your attention to a few items for the quarter before reviewing yearend guidance.
Yeah.
Total revenue for the quarter was $117 $1 million with 116.3 of that coming from Orlando, That's an almost 36% growth in Orlando or quarterly revenue over the same quarter last year.
A 33% increase in order to date, our revenue on a year to date basis over last year.
And all of their revenues in the past 12 months are now over $404 million.
Speaker Change: Oh 116.3 of global or their revenue 100 or one.
$103 1 million came from U S sales with the remaining $13 2 million or 11, 3% coming from ex U S sales.
Speaker Change: Operating expenses, not including noncash stock compensation for the quarter were $92 2 million stock compensation for the quarter was 17 point too and so GAAP operating expenses came in at $109 $4 million.
Speaker Change: We achieved an operating profit for the quarter of $24 $9 million, excluding noncash stock comp and even when including noncash stock comp, we made an operating profit of $7 $7 million.
Speaker Change: Cash at the end of the quarter was that 300, and 351 $7 million and we had positive net cash flow for the quarter of over $13 million.
Continuing strong revenue growth combined with disciplined capital allocation were the main drivers.
Also worthy of note.
Anthony: Is that we chose not to elect to pick.
Anthony: The 50% interest option in Q3, meaning that we paid out an extra $5 million of cash versus prior periods, so being able to achieve that level of cash positivity is a great achievement.
Anthony: Electric to exercise the pick option in Q3, and also not electing to draw the additional $150 million of debt tranches, both of which have now expired is due to the strong cash position and outlook for the company and our independence from capital markets.
Anthony: While Q4, and Q1 will likely be cash flow negative. We expect that later next year, we will see sustainably positive quarterly cash flow.
Charlie gave updated 2020 for revenue guidance for early day earlier, and we're now planning to achieve between 400 encourage you and $435 million.
Anthony: Given that year to date all of their revenues are at $313 5 million. This means that even more of the revenue that we generate in Q4 will fall into the lower royalty each year as we move above $350 million in annual sales during Q4.
Anthony: And could therefore, resulting in almost $8 million reduction in royalties for Q3 versus Q for Q4 versus Q3.
Anthony: In addition to that we expect significant near term revenues for wrap up first we have API orders for Southeast Asia partners for Q4 totaling almost $7 million.
Anthony: Additionally, with the announcement of the new five year 69 billion dollar U S government stockpile contract for a wrap of so around $14 million per option. We now expect to be able to ship a significant portion of the first option for this order in either late Q4 or in the first half of 2025 and the revenue associated with.
Without shipment should be $10 million with the remaining $4 million shipments likely later in the first half of 2025.
Anthony: Conservatively for wrap up for full year, we expect to have revenue of around $13 million and therefore total company revenue should be in the range of $443 million to $448 million.
Anthony: If we deliver the first part of the stockpile order in Q4 that would result in an upside to this guidance.
Anthony: Our Opex, we're now guiding up between 380 and $390 million. The main drivers for the increase are increased cost of goods sold related to the ramp of our sales, especially the API sales, which are at lower margins.
Increased variable costs like incentive compensation and distribution costs related to the continued strong revenue performance for Orlando.
The increased expenses that are seasonally booked in Q4 related to our support for the HLA community, including charitable donations.
I know we've said this before but the company really is in the best financial position, we've ever been in advancing past this milepost of achieving a quarter with such significant cash positivity is a great stuff on our path to profitability.
So we feel more confident than ever of achieving while maintaining financial independence from the capital markets.
Anthony: Having generated a significant operating profit in each of the past two quarters now we will generate an operating profit for full year 2024, not including noncash stock comp and be close to an operating profit even when incorporating noncash stock comp.
Anthony: Next year, we remain confident that we can achieve quarterly cash flow positivity and be approaching quarterly EPS positivity in the second half of the year and in 2026, we can achieve positivity in both of these metrics on a full year basis.
Anthony: With growing Orlando Air revenues plans to submit an NDA for Orla day or when children, aged two to 12 and also generating clinical data in both <unk> syndrome and D. M. M patients during that timeframe I'm very excited for the future of the company in the coming months and years.
Anthony: Greater we can now open for Q&A.
Speaker Change: We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys.
Anthony: If at any time. Your question has been addressed I would like to withdraw your question. Please press Star then two.
Speaker Change: Our first question comes from Jessica Fye with JP Morgan. Please go ahead.
Speaker Change: Hi, This is Nick on for Jeff Thanks for taking our questions.
Nick: First on patient growth for all the data out of the proven experience, which pop your patient population patients moving to profi from on demand and those naive to treatment can you talk a little bit more about which you think will drive more growth in the near term and maybe which population represents a long term opportunity and then also thinking about your guidance of approaching quarterly.
Nick: Positive EPS and positive cash flows in the second half of 'twenty. Five can you just help provide a little more framework or how youre thinking about capital allocation and spend management, especially as your pipeline begins to enter the clinic.
Speaker Change: Charlie you want to take that sure. So Nick on your first question about.
Speaker Change: Whether proceeds switches or patients moving from acute only too early day I'll drives drives a bigger portion.
Speaker Change: What we've seen since the start of the launch and this continues as a really even split between the two.
Speaker Change: Over the longer term as we kind of get out to that peak of $1 billion. We would expect that prophage switch will drive a larger portion of it but in the near in the next year or so we expect that kind of even split between the two and then Anthony.
Speaker Change: In terms of capital allocation not just for next year, but the tenant near term years through 2026 that we provided guidance for.
Speaker Change: Revenues will outpace the opex growth, but we have a we feel very comfortable with that so in terms of capital allocation. Our focus will remain on kind of two three things one continuing to secure additional growth for Orlando both here.
Speaker Change: And internationally.
Speaker Change: Continuing to fund the advancement of both Netherton syndrome, and <unk> trials into the clinic into patients and then continuing to advance the early phase pipeline that we have high hopes for them during that period, we will expect to see margin accretion and again, we feel very comfortable that we'll get to EPS and cash flow.
Speaker Change: Positivity or approaching the tail end of next year, but 2026, we expect to we fully expect to hit both of them for a full year.
Speaker Change: Great. Thank you.
Speaker Change: Welcome.
Speaker Change: And the next question comes from <unk> Ahmed with Bank of America. Please go ahead.
Speaker Change: Hey, guys. Good morning, Thanks for taking my questions.
Speaker Change: The first is on another 10, you've now guided to presenting some initial data next year, what what exactly should we be expecting to see.
Speaker Change: And what kind of data are you looking for at that biomarker data as the signs of efficacy are you just looking.
Speaker Change: For any kind of signal of activity.
Speaker Change: It would be helpful to kind of frame that expectation and then just to clarify as far as Opex goes.
Speaker Change: Should we be thinking about that heading into next year, you are investing into moving other programs into the clinic and so relative to where you ended this year just directionally, how should we be thinking about opex. Thanks.
Speaker Change: Okay.
Speaker Change: So Helen why don't you take the another Tim's question and Anthony you can take the Opex yeah. So on the another hand syndrome program will be moving into patients next year, we will be looking for a data that will be a progression of our findings at first were looking for a penetration should scan exposure at the site of that target.
Helen: Second we will be looking for markers of activity in the skin and third then we'll be looking for recovery in the skin that'll be longer term and so that'll be I think a.
Speaker Change: Later, and Helen maybe just talk about what we're trying to do with this drug it's not just the creams and the <unk>.
Helen: Dressing the symptoms, it's changing the disease.
Helen: So what's great about this approach is that it's a disease. It's a it's a.
Helen: A targeted therapy for their disease, so, whereas the standard of care is topical and a supportive treatment at the moment. This would this would affect the target at the site of disease action in the skin and correct for that missing activity of the protein.
Helen: It's like a functional cure, it's a functional cure.
Helen: Looking forward then is the evidence first of all that the drug is getting to the point in the skin, where it needs to act and then second is that it is having the effect that needs to have and we'll be looking at the healing of the scan and prevention of itching and scaling.
Speaker Change: Yeah and in terms of Opex.
Speaker Change: Quarters, one two and three relatively.
Helen: Consistent.
Helen: Take a few million dollars in terms of our numbers Q4 seasonally we usually see increased opex for that period.
Helen: But going into next year.
Helen: We'll probably give guidance at the start to the year on a on a much more specific basis, but what I would say is for next year.
Helen: In terms of looking at revenue versus Opex revenue growth on an absolute basis will significantly outpace the opex growth. So while I would expect there to be opex growth.
Helen: Especially as we move two of our assets into the clinic, a significantly outpaced by revenue and therefore, continuing to see margin accretion during that period. So even when we get to pivotal studies. The revenue will be so high with Orla day, Oh that that it will outpace the spin.
Helen: Okay.
Helen: Yeah.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: And the next question comes from Brian Abrahams with RBC capital markets. Please go ahead.
Brian Abrahams: Oh, Hey, guys. Good morning, Thanks for taking my questions and congrats on the quarter and the continued progress.
Brian Abrahams: Two for me first off you are.
Brian Abrahams: 24, or the revenue guidance suggests a slight slowdown in quarter over quarter sales growth for fourth quarter. I'm. Just wondering if that just reflects less expected benefit from the paid drug uptick that you saw in third quarter or anything else embedded in there and then secondarily.
Brian Abrahams: Just looking at 2025 consensus numbers those do suggest a slight slowdown in the quarterly or the daily sales growth rate as well and I realize it's too early for specific guidance for next year, but just wondering if theres anything we should be thinking about that you may be observing respecting with respect to demand or gross to net trends that might support this expectation as we get into next year.
Speaker Change: Thanks.
Speaker Change: Charlie you got both of those yes, I got it so yes.
Speaker Change: Yes, Brian.
Charlie: For Q4 couple of things one.
Speaker Change: We do typically see the paid rate slowing down in the latter part of the year and Thats really because it's new patients come onto therapy, it's harder to get them approved for paid therapy at the at the end of the year and so that's that's a contributor to why we have the bump up in the first half of next year as we're able to convert those patients to paid the other.
Speaker Change: The other piece is just around the holidays and the holidays don't set up particularly well this year the way Christmas falls.
Speaker Change: But.
Speaker Change: What we've reported the $4 30 to $4 35, that's what we see in our models right now.
Speaker Change: As far as the growth rate slowing next year, we're certainly not seeing the any slowing in demand is as I noted.
Speaker Change: So clearly the percentage growth over time will go down as the revenue keeps going up but but we're really confident in what we see for next year continued demand continued patient switching.
Speaker Change: So next year should be very very a very good year for US yeah, Brian I'd, just restate, what Charlie said earlier, which is 20% compound annual growth rate through 2029 that that's a nice clip a nice growth.
Speaker Change: Thanks, John Thanks, Charlie really helpful.
Speaker Change: The next question comes from.
Speaker Change: Hi, Maury Raycroft with Jefferies. Please go ahead.
Maury Raycroft: Hi, good morning, Congrats on the quarter and thanks for taking my questions. I was wondering for the 67, New U S. Prescribers added this quarter was that better than expected or as expected and can you say how many of them are from tier one versus tier two and how this could contribute fourth quarter and going forward.
Speaker Change: Sure Marty.
Speaker Change: The 67 was.
Speaker Change: As I noted it was one of our better quarters in the last two years, but all that said the last the last eight quarters have been really strong we've averaged about 62, new prescribers per quarter.
Speaker Change: So this was very.
Speaker Change: Very much in line with that consistent growth we've seen in the quarter. We had another very even split between tier one and tier two physicians as.
Speaker Change: As we have in recent quarters, and we expect that to continue so I think it's just a sign of how much demand. There is for this drug and also how much opportunity we still have in front of us.
Brian Abrahams: Got it and maybe a follow up just for the phase four study.
Speaker Change: What are some of your expectations for what the results could show in respect to switching dynamics and what are some of the strategies for how you leverage those data.
Speaker Change: So in terms of the results and this is an observational study it's a phase four so we are.
Speaker Change: Looking at how physicians are actually managing that transition.
Speaker Change: Said in the remarks, they have a choice of how they manage it whether they transition to patient immediately or whether they do it over time and we'll be looking for how that experience goes and then how patients are going after with east West shore The dam.
Speaker Change: Got it okay. Thanks for taking my questions.
Speaker Change: Youre welcome.
Speaker Change: The next question comes from safety Q.
Speaker Change: Colin Please go ahead.
Speaker Change: Hi, Thanks for taking my questions.
Colin: For first for Charlie a quick follow up as we think about this question additions for 2025 can you talk about your goals and potential additions for next year just specific numbers around how many clinicians you aim to kind of add on.
Speaker Change: And then the next question is also for next year, what are your expectations in terms of the transition to paid.
Speaker Change: Just because we've seen such that's nice progress this year.
Speaker Change: And then last for Holland.
Speaker Change: Can you speak further to this transition study.
Speaker Change: With these results we try to target.
Speaker Change: For our community cornerstones or is it just to get more feedback for patients start thinking about switching thanks, so much.
Speaker Change: Okay.
Speaker Change: So goals for <unk>.
Speaker Change: Adding new physicians well I think generally our goal is to continue the same progress that we've been making so.
Speaker Change: Continue to reach both tier ones and tier two physicians.
Speaker Change: At this point, a little over 70% of tier one physicians have prescribed oral daily. So we have more room to grow there in that group.
Speaker Change: And also that in tier one there's a lot more opportunity within current prescribers to do more so we will keep the focus there, but as I always say if there is Ah ha patient out there if there's a physician treating a patient we will find that that position and we will talk to them about orla Dale and the team has done a great job with it.
Speaker Change: As far as the.
Speaker Change: The paid rate we.
Speaker Change: To make continued progress towards 85% and one thing that we've talked a lot about is how the the Medicare paid rate has stepped back we will look to see in the first part of that next.
Speaker Change: Next year, whether that corrects itself.
Speaker Change: Whether patients are able to afford.
Speaker Change: Co payments as the irate.
Rolls in but we'll have more to report on that in the first quarter.
Speaker Change: And then with regard to the transition study. So first we know that patients are doing well.
Speaker Change: Transitioning in the real World, we've seen that in the real world evidence, we are getting questions as more and more physicians are prescribing oil a day on those questions are how do I manage this.
Speaker Change: How does the patient transition do you start immediately or do you overlap therapies. So this study is to capture.
Speaker Change: Capture that experience in the real World and then use that information to describe it for physicians, who are less experience with managing patients with HLA E through that transition.
Speaker Change: Okay. Okay very helpful. Thank you.
Speaker Change: And the next question comes from Lisa <unk> with Evercore ISI. Please go ahead.
Lisa: Hi, there can you talk a little bit more about.
Speaker Change: Your transition.
Speaker Change: Away from free browse onto commercial sort of.
Speaker Change: The shape of that when we should get to that 85% and then also how to think about the first quarter I know that's been a little lumpy, especially with the unknowns around the Medicare portion of that.
Have you sorted through that if you could give us any color that'd be great. Thank you.
Speaker Change: Sure sure.
Speaker Change: Again, the 85% is a long term goal, we're making really good progress as I noted we're already at 82% for the commercial segment and commercial is about 60% of our patients overall. So it just it shows where we're headed we would expect to get to the 85% over the next three years.
Speaker Change: Ours are so.
Speaker Change: But the big wildcard is is the as I was just saying is what happens with the Medicare patients as we go to the transition to the IRS and the Max $2000 out of pocket.
Speaker Change: Yeah.
Speaker Change: Thank you.
Speaker Change: Yeah.
Speaker Change: Just to add leases in the first quarter, we will have a better sense of that.
Speaker Change: That's where that you get a really good idea of who's covered who's not with Medicare in the first quarter. So we should have a better idea and what factors there are under your control.
Speaker Change: Hi, Bonnie.
Speaker Change: What's under our control is the relationships that we have with patients and.
Speaker Change: All of the investments that I've described before to build up our teams. So that we have so really the best in class patient services organization, and so we get ready for that that Q1.
Speaker Change: Reauthorization season, we learned a lot in the last couple of years, we're going to put all of those learnings into practice at the beginning of 2025, our goal is to get better and better every year.
Speaker Change: Yeah, and I would say, while we can't control that the the burden on the patient and Medicare is going down dramatically from last year to this year and from this year to next year.
Speaker Change: And then what we can't control the timing.
Speaker Change: And how what when that effect so put it come all in the first quarter, possibly could it be spread out over a couple of years, possibly we don't know the answer to that.
Speaker Change: Yeah.
Speaker Change: Alright, okay. Thanks.
Speaker Change: Youre welcome.
Speaker Change: And the next question comes from Gena Wang with Barclays. Please go ahead.
Gena Wang: Thank you I have two questions maybe just follow.
Gena Wang: We have question first question also noncommercial spec.
Gena Wang: So I know, there's not too much you can do but yes. There is unfavorable to you what could be extra steps you can do regarding and I'll try to get additional improvement regarding the revenue and then maybe also from the commercial side to reach the total $800 million.
Speaker Change: Our guidance in the U S and the second question is regarding this.
Speaker Change: But your new SaaS.
Speaker Change: So the question for the 770 251 data in 2025.
How would you or do you need to do a biopsy at the skin biopsy and to measure the protein expression.
Speaker Change: I think at the.
Speaker Change: We're hearing Potter seems pretty straightforward and then regarding the biomarker could you give a bit more color regarding what kind of protein, especially you were looking for and how do you measure that.
Speaker Change: Okay. So Charlie you want to question, one and Helen number two it hygiene is as far as what we can do I think I'm going to say something pretty similar to the last couple of answers that we gave we do what we can to help patients get ready, but there's a lot that's outside of our control.
Speaker Change: One thing also patients do as themselves is has worked closely with the <unk>. The patient Association, who also gives them a lot of education.
Speaker Change: And information about getting to paid therapy, and and and that's true for patients who have Medicare in patients who have other other insurance and so what we do is whatever we can do compliant Lee to help them educate them and.
Speaker Change: Put them invest best positioned to get to paid as John was just noting if im sorry, just one other thing you said what could negatively go wrong, it's actually trending in the positive yeah. So we saw it go from under 50% now up to 55% this year.
Speaker Change: Certain that part of that is the changes in the cost to the patients and we expect that to continue to improve so I don't think we see a negative we see it moving in the positive direction, what we cant predict is what I said before the speed at which that changes right.
Speaker Change: Yeah, and then on 17, 75, so where will it be enrolling patients in 2025 with initial data coming in.
Speaker Change: It is a comment to do skin biopsy or to test the skin in this disease and that's a very good way of understanding if youre getting penetration drag at the skin. So that's that's a critical first.
Speaker Change: First step is to demonstrate that the drug is getting to the scan binding to the target in the skin.
Speaker Change: And this drug is also has very high affinity. So we'll be looking for binding to the target and then maintenance of that finding so once it's on the target it doesn't come off them.
Speaker Change: So in terms of biomarkers than in the skin will be looking number one as I said for drug present in the skin, but number two activity at target. So this is activity of the drug in a binding and preventing K, okay five activity it's possible.
Speaker Change: Downstream that we could also be looking at cytokines and cytokine release, that's a downstream cascade reaction to a K. Okay. Five activity. That's the kind of thing that will define further as we move towards the clinic with patients and Helen is it safe to say with a potent drug like this you know what dose we ultimately need in the frequency it'll be another important piece, though it will be yes.
Speaker Change: Expect to see that activity binding affinity sticking them activity, but that means that we will be looking at how long is it before I need another test this could be a very potent and we expect to be delivering it potentially in subcutaneously and it could be at an extended interval of time before a second dose as needed.
Speaker Change: Okay.
Speaker Change: Thank you.
Speaker Change: Youre welcome.
Speaker Change: And the final question comes from third Bellinger with Needham <unk> Company. Please go ahead.
Speaker Change: Good morning, and thanks for squeezing me in.
third Bellinger: I guess two for Charlie.
Speaker Change: The first one on patient adds I think on slide eight where you lay.
Speaker Change: Lay out the path to get to $800 million in scale, you assume an annual rate of.
Speaker Change: 200, new patients just curious where you are tracking relative to that target given that you said that.
Speaker Change: The rates currently 14% or 15% above where you were 12 months ago.
Speaker Change: And then secondly on the competition front I know one of the prophylactic.
Speaker Change: It was delayed a little bit recently, but maybe we should assume one or two new approvals on the proceeds front in 2025.
How do you think about that could impact a switch opportunity for early deal once they're approved.
Speaker Change: Thanks, Serge Yeah.
Speaker Change: Yeah on patient adds.
Speaker Change: Much on track as you can imagine, we're having a great year with Orlando.
Speaker Change: And so as I said in my prepared remarks, we are as confident as ever.
Speaker Change: As far as the the potential new competition, yes, we expect two new injectable proceeds to launch sometime in the middle of next year.
Speaker Change: And what are all of our modeling and market research shows is that a new injectables will really compete with existing injectables not with us as an oral but it's an opportunity in that there will be more discussion about switching and and we have we think the most differentiated.
Speaker Change: Product with a once daily oral and so it creates an opportunity for us and we were ready for anything that might have come this quarter now that it's a little bit delayed will be ready at the beginning at the middle of next year.
Speaker Change: I would think about it this way if a doc in a patient and are at a point, where they're open to switching from their current therapy why on Earth wouldn't they tried the oral first right and so we think that's a real opportunity.
Speaker Change: Yeah.
Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Mr. Stonehouse for any closing remarks.
Mr. Stonehouse: Yeah. So it's great to see another outstanding quarter on multiple fronts and these quarters are the building blocks of building a growing company and a sustainable company and that doesn't happen by accident that happens by dedicated employees that are working their butts off to deliver.
Speaker Change: Sure.
Speaker Change: On our goals and continue to help us execute quarter after quarter after quarter. So I want to say, thank you to all the biocryst employees for another great quarter and end, what's shaping up to be a fantastic year, you guys have a great day.
Speaker Change: Yeah.
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Speaker Change: Okay.