Q4 2024 Incyte Corp Earnings Call
and Matt Phipps.
Speaker Change: Fly, Eagle, Fly! On the road to victory! Fly, Eagle, Fly! Score a touchdown one, two, three! In a low, in a high, watch our Eagles fly!
Speaker Change: Greetings and welcome to the Insight fourth quarter 2024 and full year financial and corporate update conference call and webcast.
Speaker Change: At this time, all participants are in a listen-only mode. If anyone should require operator assistance, please press star zero on your telephone keypad.
A question and answer session will follow the formal presentation.
Speaker Change: You may be placed in the question queue at any time by pressing star 1 on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Ben Strain, Associate Vice President, Investor Relations. Please go ahead, Ben.
Ben Strain: Thank you, Kevin. Good morning and welcome to Insight's fourth quarter and full year 2024 earnings conference call.
Ben Strain: Before we begin, I encourage everyone to go to the investors section of our website to find the press release, related financial tables, and slides that follow today's discussion. On today's call, I'm joined by Herve, Pablo, Christiana, who will deliver the prepared remarks. Mateo and Steven will also be available for Q&A.
Ben Strain: I would like to point out that we will be making forward-looking statements which are based on our current expectations and beliefs.
Ben Strain: These statements are subject to certain risks and uncertainties and our actual results may differ materially. I encourage you to consult the risk factors discussed in our SEC filings for additional detail. I will now hand the call over to Herve.
Thank you, Ben, and good morning, everyone.
Herve: So we delivered another strong year with 2024 total revenues growing 15% versus 2023 to reach $4.2 billion, continuing the steady growth we have delivered since 2020.
Herve: In addition to the consistent performance of Jakafi in 2024, we saw strong growth from our non-Jakafi revenue, primarily driven by Obsidora, highlighting our continuing revenue diversification.
Moving to slide 6.
Herve: In 2024, Jack Fye's net sales were $2.8 billion, growing 8% versus the prior year, with growth coming from all indications.
Herve: Obsedora saw strong continued momentum in 2024, growing 50% to 508 million, driven by both new patients and refills in AD and VTLEGU in the U.S. and expanding reimbursement outside the U.S.
Herve: We expect Obceloa to continue to be a key contributor to growth in the next years.
Herve: Our cash flow remained strong, which allowed us to complete a 2 billion share repurchase during 2024, while maintaining a strong balance sheet.
Herve: We ended 2024 with $2.2 billion in cash and no debt. We are in a very strong financial position with growing revenues and a robust pipeline that will deliver a number of very exciting readouts in 2025.
Herve: Last month, we and our partner Syndax announced that the FDA approved Nictimvo in 9mg and 22mg vial sizes, paving the way for the commercial launch.
Herve: This medicine is now available in the U.S. and the commercial launch is underway. Nictimvo is the first anti-CSF1R antibody approved to target the inflammation and fibrosis associated with chronic GVHD.
Herve: And we are excited to bring this new therapy to the approximately 6,000 patients who are currently treated after second-line therapy in the U.S.
Herve: In addition to the launch of Nictimvo, the SNDA for Roxolytinib Cream in Pediatric Atopic Dermatitis,
Herve: was filed with the FDA and we are on track for potential approval in the second half of 2025.
Herve: With 2 to 3 million pediatric patients in the U.S. suffering from atopic dermatitis, we see significant opportunity for oxalatine lip cream, with its compelling efficacy in controlling itch, to address an important need for this patient population.
Herve: We submitted pivotal study results to the FDA for both Staph acetamab in follicular lymphoma and retifanilimab in squamous cell adenal carcinoma, and anticipate approvals for both in the second half of 2025.
Herve: These product launches are expected to begin contributing to revenue in the near term with the potential to collectively generate $1 billion in incremental revenues by 2029, further diversifying our revenue.
Herve: We anticipate all four products to be available in 2025 and we will be leveraging our existing commercial infrastructure established for Jakafi, Obselura, Montjuvis and Pemazir to support the launches of these new products or indications.
Moving to slide 9.
Herve: And an update of the 4th quarter and full year 2024 commercial performance for Jakafi.
Herve: In the fourth quarter, Jakafi's net park revenue grew 11% year-over-year to $773 million and grew 8% for the full year to $2.8 billion.
Herve: Total patients increased 10% in Q4 when compared to the same quarter in 2023.
Herve: Importantly, growth is being seen across all indications, but with particular strength in PV, with this indication now accounting for 35% of the patients on JAKAT5.
Herve: We expect continued growth of Jakafi in 2025 and expect the full year net product revenue for 2025 to be in the range of $2.925 to $2.975 billion.
Speaker Change: Turning to slide 10 and looking at Jessica Fye's total paid demand by indication during 2022, 23 and 2024.
Speaker Change: As you can see, unit growth remains robust. Myelofibrosis showed growth again this quarter, while the most significant growth was seen in polycythemia vera.
Moving to observance, slide 11.
Speaker Change: Obsedora net product revenue in the fourth quarter was $162 million, up 48% when compared to the same quarter last year.
Speaker Change: And this was comprised of 138 million in the U.S., driven by growth in A.D. and D.T. LIGO, new patients and retails, and 24 million ex-U.S., driven by growth in Germany and France.
Speaker Change: Total 2024 full year net revenue grew 50% versus 2023 to reach $508 million.
Speaker Change: In the U.S., the annual prescription trends for 2022, 23, and 24, as shown on the right of slide 11, reflects continued year-over-year growth of opcellura from both atopic dermatitis and vitiligo.
Speaker Change: We anticipate continued growth of Obserior in 2025 and expect the full year net product revenue to be in the range of $630 to $670 million.
Speaker Change: On slide 12, so 2025 will be a year of defining catalysts that will provide an inflection point for insight. As you can see highlighted on slide 12, every program has meaningful milestones expected in 2025.
Speaker Change: This includes four potential launches, collectively providing important near-term revenue potential, where the launch of Nictimvo is already underway, as I just highlighted.
Speaker Change: Additionally, we plan to initiate at least three phase 3 studies, including our BET inhibitor, ROCKScreen in mild to moderate HS, and our CDK2 inhibitor in ovarian cancer.
Speaker Change: We expect 2025 will be a data-rich year, with four pivotal data readouts, including Roxolitinib XR.
which Pablo will highlight shortly.
Speaker Change: More importantly, we expect seven early-stage programs to generate informative data, which we believe has the potential to transform the company.
Pablo: Before I hand the call over to Pablo, I would like to provide a leadership update for our commercial organization.
Speaker Change: After a remarkable decade of dedicated service to InSight, Barry Flannelly has decided to retire from his role as Executive Vice President, Head of U.S. Oncology.
Speaker Change: We are pleased to announce that Mohamed Issa assumed Barry's role in January, and Mohamed has successfully led U.S. commercial teams in oncology, immunology, and neuroscience, most recently at J&J.
I will now turn the call over to Pablo.
Thank you, Herve, and good morning.
Speaker Change: As we highlighted a year ago, and we summarized on this slide, we'll remain on track to deliver more than 10 high-impact launches by 2030 from programs across the portfolio.
Speaker Change: On slide 15, I would like to quickly highlight some of the key accomplishments during 2024, and I will then cover some of the milestones expected in 2025.
Speaker Change: We had a number of important radiator achievements in 2024, including the approval of Nictinvo for Thirline plus chronic graft-versus-host disease.
Speaker Change: and three submissions to the FDA with expected approvals later this year.
Speaker Change: including obsolure and pediatric atopic dermatitis, retifamily map in SCAC, and tafacitamab in relapsed or refractory follicular lymphoma.
Speaker Change: We disclosed data from our CDK2 inhibitor and BENT inhibitor programs and provided pivotal study plans for both, which we anticipate initiating this year.
Speaker Change: We continue to evolve at R&D Focus with the intent of increasing the rigor of our decision-making, accelerating the progression of our pipeline, and optimizing our resource allocation.
Speaker Change: Through the fourth quarter of 2024, we presented data at the American Society of Hematology Annual Meeting, or ASH, from both our BET Inhibitor Program and Phase III results for taphocytomab in patients with relapsed or refractory fovecal lymphoma.
© The Bulletproof Executive 2013
Speaker Change: The Phase III results of tafacitumab in follicular lymphoma were presented at a late, breaking session and show that the study met its primary endpoint by demonstrating a statistically significant and clinically meaningful improvement in progression-free survival.
Speaker Change: This was, to our knowledge, the first study to validate the combination of an anti-CD19 with an anti-CD20 monoclonal antibodies in patients with follicular lymphoma.
Speaker Change: Tafasitima was generally well tolerated and safety was consistent with its known safety profile.
Speaker Change: This data has been submitted to the FDA and approval is expected in the second half of 2025.
Speaker Change: For our BET inhibitor, we shared additional data from the ongoing dose escalation study as both monotherapy and in combination with roxalidinib.
Speaker Change: This results show reductions in spleen volume, as well as improvements in both symptoms and hemoglobin.
Speaker Change: As highlighted on this slide, we plan to advance this program into Phase 3 development as a monotherapy in the post-jack population, and we look forward to providing additional details later this year.
Speaker Change: Moving to slide 18, we are continuing to execute a broad development plan for povracidinib, our oral small molecule highly selective JAK1 inhibitor.
Speaker Change: Bover-Sidnev is currently being evaluated in Phase III studies in Heteronatus Suprativa, Vitiligo, and Prurigo Nodularis, and in randomized Phase II proof-of-concept studies in chronic spontaneous urticaria and asthma, with data for both expected in 2025.
Speaker Change: Oversitnim has already shown encouraging efficacy and safety in a randomized phase 2 study in patients with moderate to severe hibernitis suprativa, a highly painful inflammatory condition.
Speaker Change: As highlighted on the right side of the slide 19, Provost Sidney has showed significant responses by week 12, including improvements in high score 50, 90, and 100.
Speaker Change: Additionally, poversity has demonstrated a rapid and significant reduction in pain, offering the potential to transform the current standard of care for this disease.
Speaker Change: The two Phase 3 studies, STOP HS1 and STOP HS2, are fully enrolled and we expect to have Phase 3 data in the first half of this year.
Turn to the Mutant Color Antibody Program on slide 20.
Speaker Change: The publication detailing our mutant collar monoclonal antibody was recently featured on the cover of Blood, highlighting the importance of this innovative medicine.
Speaker Change: This antibody was developed entirely by Insight, and unlike Jackify, the mutant CalR antibody has the potential to eliminate the mutant clone and normalize hematopoiesis in patients with CalR-mutated essential thrombocytemia or myelofibrosis.
Speaker Change: potentially leading to a functional cure. We'll look forward to sharing data from the ongoing proof of concept studies in both ET and MF later this year.
Thank you.
Turn to slide 21 and Rux Lydnyb XR
Speaker Change: We're pleased to announce that a bioequivalency study of ruxlitinib 55 mg extended release demonstrated the once-a-day formulation to be bioequivalent to twice-a-day ruxlitinib.
Speaker Change: Biequivalence was achieved for both AUC and Cmin and the geometric means ratios falling within the 80-125% biequivalence reference range.
Speaker Change: We have reviewed this data with the FDA and with their agreement plan to submit for approval by the end of the year once stability studies are completed.
Speaker Change: As mentioned, 2025 will be an important year for Insight with over 18 key milestones, including four new product launches, four pivotal trial readouts, at least three phase three study initiations, and seven proof of concept study results.
Speaker Change: As you can see on slide 22, we have already achieved two of these milestones that we first highlighted just last month with the launch of NICTIMVO and bioequivalency data for ruxelinib extended release.
Speaker Change: We look forward to sharing additional updates on this milestone over the course of 2025. And with that, I would like to turn the call over to Christiana for the financial update.
Christiana: Thank you, Pablo, and good morning, everyone. Our fourth quarter 2024 results reflect strong commercial execution and continued growth with total revenues of $1.2 billion, up 16% versus the same period last year.
Christiana: Total product revenues of $1 billion in Q4 were driven by strong demand growth for Jagathai and Opselura and increased revenue contribution from Monjuvi as a result of the acquisition of full rights to Tafasita MAP in 2024.
Christiana: Total royalty revenues were $159 million, up 6% compared to Q4 2023, driven by increased demand for Jackavy.
Thank you. Thank you.
Christiana: Turning to Jackify on slide 26. Jackify Net Product Revenue was driven by strong patient demand growth across all indications.
Christiana: In the fourth quarter of 2024, net product revenue increased 11% year-over-year, driven by a 9% increase in total demand and a 14% increase in paid demand.
Christiana: For the full year 2024, net product revenue increased 8% versus 2023, driven by a 7% increase in total demand and a 9% increase in paid demand.
Christiana: Recall that in Q3 and Q4 2023, we saw a significant increase in the number of Medicare Part D patients receiving free product.
Christiana: As we anticipated, these patients returned to paid demand in 2024.
Christiana: As a result, year-over-year paid demand growth exceeded total demand growth in both the fourth quarter and full year 2024.
Christiana: Turning now to Opselura on slide 27, total net product revenue for the fourth quarter was $162 million, representing a 48% increase year-over-year, driven by growth in new patient starts and refills across both AED and vitiligo in the U.S., as well as continued contribution from the commercialization of Opselura for vitiligo in Europe.
Christiana: In the fourth quarter, Ex-U.S. Obsolera Net Product Revenue was $24 million.
Christiana: For the full year, net product revenue was $508 million, representing a 50% increase year over year. And next year's net product revenue was $61 million.
Christiana: Moving on to slide 28 and our operating expenses. Total GAAP R&D expenses for the fourth quarter were $466 million, an increase of 5% compared to the same period in 2023, due to continued investment in our late-stage development assets and timing of certain expenses.
Christiana: For the full year 2024, ongoing R&D expenses, excluding the ASEAN Acquisition Upfront Consideration and other one-time expenses, increased 14% year-over-year as a result of increased investment in our late-stage programs.
Christiana: As we wrap up the clinical developments of certain of these programs as well as the development activities of discontinued programs, we anticipate the reduction in investment in those programs to partially offset the increased investment in other programs, which would allow us to control future R&D expense growth.
Christiana: representing an 11% year-over-year increase primarily as a result of Insight now recording Monjuby-related sales and marketing expenses in the U.S. following the acquisition of global rights to the program in 2024.
Christiana: as well as the timing of consumer marketing activities and certain other expenses.
Christiana: For the full year 2024, total GAAP-SG&A expenses increased 7% year-over-year as a result of us now recording Monjuvi-related sales and marketing expenses and investment in the launch of OBSELURA in Europe and the preparation for new product launches in the U.S.
Christiana: Finally, total ongoing R&D and SG&A expense for the full year increased 10% versus a 15% increase in total revenues, leading to an increase in operating leverage and margins.
Christiana: Moving on to 2025, I will now discuss the key components of our guidance on a gap basis.
Christiana: For Jakafi, we expect Net Product Revenue to be in the range of $2.925 to $2.975 billion, well on track to achieve our long-term guidance of over $3 billion by 2028.
Christiana: We expect net product revenue growth to be driven exclusively by continued demand growth, primarily in PV, and be partially offset by lower net pricing as a result of IRA-imposed price increase caps and continued growth in 340B volumes.
Christiana: As in previous years, we expect the gross net adjustment to be higher in the first quarter of the year relative to the previous quarter and subsequent quarters due to higher deductibles that are primarily impacting Q1.
Christiana: For Opseloura, we expect total net product revenue to be in the range of $630 to $670 million, driven by continued demand growth in AD and VT LIGO in the U.S.
Christiana: Initial contribution from the potential launch of Opselura for Pediatric AD expected in the second half of the year, and increased contribution from Opselura for vitiligo in Europe.
Christiana: In the first quarter of the year, we expect to see again the effects of typical Q1 dynamics on net sales due to planned deductibles resetting at the beginning of the year and the impact of holidays, medical conferences, and other events on dermatology product sales.
Christiana: As a result, Q1 obsolera net product revenue is expected to be below the previous quarter, consistent with what we saw in 2024.
Christiana: For other oncology products, we expect total net product revenues to be in the range of $415 to $455 million.
Christiana: These include contributions from both the current approved indications for Reclusiv-Nictimvo-Mondjouvi-Mindjouvi-Pemazir and Zainiz, as well as the launches of Mondjouvi-NFL and Zainiz-CAC anticipated in the second half of 2025.
Christiana: Turning to operating expenses on a gap basis, we expect COGS to range from 8.5% to 9% of net product revenues.
Christiana: The increase in the COGS rate is driven by certain manufacturing-related expenses and the impact of our profit-share agreement with Syntax for Nictimbo in the U.S. A syntaxes portion of the profit share will be reflected in COGS.
Christiana: R&D expenses are expected to be in the range of $1.93 to $1.96 billion, primarily driven by the progression of our pipeline.
Christiana: We expect SG&A expenses for the year to be in the range of $1.28 to $1.31 billion.
Speaker Change: Operator, that concludes our prepared remarks. Please give your instructions and open the call for Q&A.
Speaker Change: Certainly. We will now be conducting a question and answer session. If you would like to be placed into question queue, please press star 1 on your telephone keypad. We ask that you please ask one question, then return to the queue.
Speaker Change: You may press star Q if you'd like to remove your question from the queue. Once again, that's star 1 to be placed in the question queue.
Speaker Change: Our first question is coming from Michael Schmidt from Guggenheim Partners. Your line is now live.
Speaker Change: Hey, good morning. Thanks for taking our question. This is Paul. I'm for Michael. We have two on the pipeline. First, on Opsalora, can you set some expectations for the upcoming phase 3 in Prurigo nodularis? What's the clinical bar here, given there's no topical therapies available? And then secondly, just on the CDK2 program, are there any plans to provide another clinical update on the phase 1 ovarian cancer study, perhaps with longer follow-up at the expansion dose levels? And what are the gaining factors to formalizing a pivotal study dose selection? Thank you.
Speaker Change: Certainly, good morning. Thank you for the questions. Let me take the second one real quick. For the CDK2 program, as we discussed earlier,
Speaker Change: this year. We plan to initiate pivotal trials this year, and as we discussed, that will be in platinum.
Speaker Change: resistant ovarian cancer. We've taken a dual approach there with a single arm study for what we hope will be accelerated approval in the U.S.
Speaker Change: as well as a randomized trial that we will provide more details over the course of the year. So that program is advancing rapidly and we will provide an update later this year as you asked.
Speaker Change: The second part of the question, in terms of Rox Cream and Perigonodularis, as you know,
The phase three data are coming in this half.
Speaker Change: And I think what, you know, in terms of setting the bar, when you look at the phase two data and the improvement both on the global assessment of itching as well as the WNRS endpoint.
Speaker Change: We think that if we are anywhere in the vicinity of what the Phase II trial showed, this is going to be a very important addition to the armamentarium for patients with prurigal nodularis.
Speaker Change: The availability of a topical for patients that have perhaps less severe disease than those that may require systemic medicine, such as poversity, we think it's going to be very important.
Speaker Change: So, we want to be somewhere, and as we all know from the extensive safety track record of Roxgreen, it's a very, very well-tolerated medicine. So, if we're anywhere near what the Phase II results showed, I think we're going to be, it's going to be a very important contribution for patients.
Speaker Change: Your next question is coming from Tazeen Ahmad from Bank of America. Your line is now live.
Tazeen Ahmad: Hi, guys. Good morning. Thanks for taking my questions. As it relates to Opsalora, can you give us a sense of how you got to guidance for this calendar year? Specifically, how were you thinking about the number of tubes that are going to be used for the two approved indications?
Tazeen Ahmad: And then maybe one question on POVOR, for the HS data that's due in the first half of this year, what would you consider to be not only statistically significant but also clinically meaningful data? Thanks.
Tazeen Ahmad: Hi, Tazeen, it's Christiana. Regarding the OBSELURA guidance, first of all, when you look at the guidance range that we provided, the $630 to $670 million for the year, it represents 24% to 32% year-over-year growth.
Tazeen Ahmad: As we indicated in our prepared remarks, this is driven by continued demand growth in AD and VT LIGO, and also reflects the potential launch of Opselura in pediatric AD in the second half, a contribution from that indication.
and continued increased contribution from Europe.
Tazeen Ahmad: The range that we provided primarily reflects variations in the patient mix as well as in the level of patient activation rate and adherence in vitiligo and level of contribution from Europe.
Tazeen Ahmad: In terms of the tubes, the level of tubes, that's especially around vitiligo is reflected in the level of patient activation rate and adherence.
Tazeen Ahmad: We are seeing an increase in the average number of patients that are sticking with therapy.
Tazeen Ahmad: and therefore refill their prescription and also in the average number of prescriptions per patient. But as we have commented in the past, this is an area that is evolving.
Tazeen Ahmad: initiatives to help patients, educate patients and help them appropriately use vitiligo, the opsalura for vitiligo, and that is reflected in the guidance range that we have provided.
Tazeen Ahmad: Finally, the other thing, again, to keep in mind, as you think about the guidance and how do you distribute it through the course of the year.
Tazeen Ahmad: Q1, as I mentioned in my prepared remarks, always tends to be lower than the previous quarter and the subsequent quarters. We saw that in 2023, we saw it in 2024 when we expect to see the same dynamics in 2025.
Let me take the second part of the question.
Tazeen Ahmad: So, look, the first and most important thing is obviously to have a positive study or two positive studies. And that, as you know, means statistical significance for the primary endpoint, which in this case is high score 50 at week 12 in the two hydroinvasive supertubule studies for POVO.
Tazeen Ahmad: Now, beyond that, I think that when one looks at the phase 2 results with the Pover-Sidney study, and you look at the totality of the data, and that is effect on high score 50, 75, 90, and 100, as well as the strong effect on pain improvement that the study showed, together with the safety profile when the phase 2 was very clean.
Tazeen Ahmad: In that study, there were no thrombotic events in the high-dose POVO arm. There were no patients that discontinued due to adverse events in the POVO arm.
Tazeen Ahmad: So, I think that the profile that we've seen in phase two, and we realize there's always a little bit of contraction in phase three, a little bit of, you know, the results can change a little bit.
Tazeen Ahmad: But we believe the overall profile that we saw in phase 2 If we are somewhere in the vicinity of replicating those results of the phase 3 studies, we think we have a very competitive profile with Provercydinib and Heteronitis Superativa
Speaker Change: Thank you. Next question today is coming from David Lebowitz from Citi. Your line is now live.
David Lebowitz: Thank you very much for taking my question. Given the IRA out-of-pocket has moved to its go-forward levels at $2,000 per year,
David Lebowitz: Can you run us through what the process is that a patient must go through to actually ensure that the cap is put in place? What steps do they need to take and how long do you think it might be until the benefit of that starts showing up in sales?
today
David Lebowitz: The cap for the out-of-pocket this year is reduced to $2,000 a year.
David Lebowitz: Patients do have an option to have this spread through the course of the year in equal payments.
David Lebowitz: A continued benefit from the lower half out of pocket as we saw in 2024.
Thanks for taking the question.
Jessica Fye: Thank you. Next question is coming from Jessica Fye from J.P. Morgan. Your line is now live.
Jessica Fye: Hey guys, good morning. Thanks for taking my questions. A couple on POVO in HS. So I think north of 60% of the patients in your phase 3 trials are biologic naive. Are you going to seek a label that includes biologic naive patients or do you expect it will be labeled for post-biologic patients?
Jessica Fye: and then within the trials are you powered for both the biologic naive and experienced subgroups and is there anything you can say about the powering assumptions there?
Speaker Change: Jess, so as you point out and we haven't discussed a specific percentage but roughly directional that's correct in terms of biologics naive and biologically exposed patients.
Speaker Change: Prior exposure to biologics is a stratification criteria in the phase 3 trials. We expect to analyze the data based on prior exposure to biologics.
Speaker Change: I'm not going to comment on the full powering, obviously the studies are powered on the basis of assumptions around the primary endpoints and the key secondary endpoints for the study. So we'll discuss the results in more detail and obviously in terms of labeling discussions we'll see what the data looks like and we'll discuss with FDA at the right time.
Speaker Change: Hey Pablo, can I can I follow up on one of the responses to I think it was Tazeen's question?
When you said, um...
Speaker Change: If you show something that's, you know, close to what you showed in phase two, that would be super competitive.
Speaker Change: Because I think the phase 2 deltas on high score 50 differed a little bit if you look at the 16-week versus the 12-week time point. And I think in phase 3 it's a 12-week. So when you say close to phase 2, do you mean close to the 12-week cut of phase 2 or close to the 16-week?
Speaker Change: Yes, you're correct. So if you remember, the placebo subtracted high score 50 at week 12 is 28% and at week 16 is 17% in the phase 2 studies. That's I think what you're referring to.
Thank you.
Speaker Change: Look, we selected week 12, it's one of the key differences, I think, when you look at the POVO data, not just in HS, but also in PN, for example, is how quickly it works. And that is very important for patients with painful or intensely periginous diseases like HS and PN.
Speaker Change: So, that's the importance of the Week 12. My comment was referring roughly to replicating the profile that we saw in Phase 2. I don't want to set a number. We're running the Phase 3 studies to have clarity on what the actual benefit of pulmonary sydney is in large Phase 3 studies.
So any...
Speaker Change: The number, the specific percentage that we see is not something we're gonna comment on right now, but a profile that is consistent with the phase two is what we expect to see in the phase three.
Salveen Richter: Thank you. Next question today is coming from Salveen Richter from Goldman Sachs. Your line is now live.
Salveen Richter: Thanks for taking my question. Just a follow-up here on POVO. With regard to the
Speaker Change: Well, this is just one slide on the phase 2 data and we saw this drop from week 12 to week 16. Could you just speak about the read-through to this trial and the risks that may play out there and then also in your 2025 guidance?
Salveen Richter: Just speak to us about how you model for Part D redesign for Jackify. Thank you.
Speaker Change: Certainly, I think, look, the clinical trials, particularly in diseases like HS, but they have a placebo effect, as you know, you're going to see some movement on the efficacy endpoints and the efficacy curve over time.
Speaker Change: What we saw in the phase two, as both you and the previous colleges pointed out, was that from week 12 to week 16, there was a drop in the placebo-subtracted response in the POVO arms.
It's probably variability and noise related to clinical trials.
We are not concerned about that
Speaker Change: The studies are well-powered to demonstrate what we believe is a statistically significant difference between POVO and placebo. And we think we'll see not only a statistically significant but a clinically meaningful impact of POVO on the primary endpoint, which is high score 50 at week 12.
Speaker Change: as well as the key secondary endpoints, which include, obviously, other levels of clinical benefit and other time points in this study.
Speaker Change: Regarding your second question, Salvina, on the impact of the Medicare Party redesign on Grosvenor for Jaka Pai
Speaker Change: We do expect to see some savings in Medicare Part D, since our contribution to the donut hole will now be replaced by 1% participation to the catastrophic coverage, given that we have the small biotech exception. However, these savings would be offset by continued increase that we see in 340B.
Speaker Change: Thank you. Our next question today is coming from James Shin from Deutsche Bank. Your line is now live.
James Shin: Hey, good morning guys. I just wanted to follow up on COVID-19 stop HS1 and HS2 phase 2 trials.
James Shin: How will you disclose this data? Will we get a press release with high score top line followed by full data at a medal conference?
James Shin: and then any update on the X2 program for CSU. Thank you.
James Shin: So on Provo 4-HS, our plan is once we have the data is to disclose in a press release and almost certainly we have a call to discuss the results with investment community.
James Shin: On 262, I don't have an update at this point. We are still completing the evaluation of the events that we described late last year in the preclinical findings in the toxicology, and we'll provide an update later this year.
Vikram Purit: Thank you. Next question is coming from Vikram Purit from Morgan Stanley. Your line is now live.
Vikram Purit: Hi, good morning, thanks for taking our question. We had just one on
Vikram Purit: The proof-of-concept data sets expected for mu and Kel-R and then also for JET to be 617Fi.
for later this year.
Vikram Purit: Can you just help us kind of frame what we can expect to learn and...
Vikram Purit: And what you're setting as the bar for success with these data sets and what the hurdles going to be for moving these programs forward. Thank you.
Speaker Change: So, let me start with mutant color. So, as you point out, we'll have proof of concept data this year for both patients with ET and MF. That will come over the course of the year.
Speaker Change: What we expect to see, and just to, first of all, let me tell you a little bit about what you're going to see. And it's going to be a substantive amount of data. We expect to have data at different dose levels.
Speaker Change: with some amount of follow-up in order to have clarity on some of the important measures of success for those programs.
Speaker Change: Obviously, we discussed over the past few months the importance for this program not only to show an impact on the traditional endpoints in patients with myeloporifacive neoplasms.
Speaker Change: to see some early evidence of ideal reduction which we think is an important measure of success. This is not going to be definitive data but we want to have some evidence.
Speaker Change: that a mutant color antibody in patients with ETNMF can show some evidence of value reduction. So that will all be part of the update.
Speaker Change: 617F, if you recall, started in the clinic later. We started dosing patients with MF in the third quarter of 2024, so it's a little bit behind.
Speaker Change: We intend to have an update this year, and the same points apply basically to that program. We would like to see impact, not only a traditional endpoint, but some early evidence of a lead reduction in that program as well.
Thank you.
Speaker Change: Thank you. Next question today is coming from Marc Frahm from TD Cowen. Your line is now live.
Marc Frahm: Thanks for taking my questions. Maybe to start, one nuanced question on stop HS. Pablo, you mentioned earlier, you know, often these trials do have a little bit of a decline in treatment effect from phase 2 to phase 3.
Speaker Change: In H.S. specifically, we've seen changes in antibiotic use and how that's treated with SAP, you know, maybe drive some of that effect.
Speaker Change: Can you remind us just how antibiotic use is being treated, was treated in phase 2 and how that may or may not differ in the phase 3 trial?
Speaker Change: And then for Christiana, on the obsoleric guidance, can you break down some of the assumptions there on U.S. versus ex-U.S. growth, just given the kind of label changes that are happening, but also, you know, increasing reimbursement outside the U.S.?
So let me take the first part of the question.
Speaker Change: First of all, the use of antibiotics in the Phase III is true the same way it was in the Phase II. So let me just remind you what that is.
Speaker Change: Patients are not allowed to be on systemic antibiotics at study entry. Over the course of the study, if patients are started on systemic antibiotics or a flare,
Speaker Change: that's treated as a non-responder. Now, if a patient has started on a systemic antibiotic for a completely unrelated reason, that is not treated as a non-responder, and that's consistent with the phase two.
Speaker Change: In terms of the OBSELURA guidance, the guidance that we have provided is global and it does reflect increased contribution from Europe. In 2024, the contribution was primarily driven by Germany and France.
Speaker Change: And in 2025, we expect continued contribution from those two countries, but also now increased contribution from Italy and Spain. We are not going to be breaking down the guidance between the two regions.
Speaker Change: Thank you. Next question is coming from Kelly Shee from Jefferies. Your line is now live.
Thank you for taking my questions.
Speaker Change: I have two. Firstly, can you share a little bit more color on QROS 212D program in terms of POC data?
Speaker Change: what kind of like sample size and also tumor indications could we expect and also based on the preclinical data
Speaker Change: achieved so far? Do you think it hints any potential differentiation from other competitive G12D programs?
Speaker Change: And for Pablo, I just quickly want to confirm, for the high score of 75, 90, and 100, do you plan to show at a 12-week follow-up only or actually both 12 and 16-week follow-up? Thank you.
Speaker Change: Well let me, thank you Kelly. So in terms of KRAS, so the indications here as that have been the focus for us are pancreatic cancer and colorectal cancer.
specifically on pancreatic cancer. We're trying to accelerate enrollment.
because obviously it has become a very competitive space.
Speaker Change: We're fully aware of what our competitors are doing. We believe, based on the profile here that we have preclinically, which is highly selective,
Speaker Change: It will come down to the efficacy and safety that we see But when we look at the data from our competitors we think particularly as we move to early lines of therapy in combination
there's still space for a highly selective, well-tolerated,
Speaker Change: G12T inhibitors. So we look forward to discussing data later this year, but that continues to be our view.
Speaker Change: In terms of what we're going to disclose for the POVO-HS studies in terms of other endpoints.
Speaker Change: That's not a decision that we've made at this point. Obviously, we'll have to communicate the overall results of the studies, as I answered a little bit earlier here. But whether we add a number of other endpoints to that release, we haven't decided.
Speaker Change: Thank you. Next question is coming from Brian Abrams from RBC Capital Markets. Your line is now live.
Brian Abrams: What's your latest thinking on the frontline development path? What are you looking for out of the treatment that you've combo dated to move forward and are we still looking for results from that this year? Thanks.
Brian Abrams: So on the second line, look, I think that today, as we know, eventually, as good as Jackify is for patients with myelofibrosis,
Brian Abrams: eventually ill patients progress and they need a better treatment options when they progress.
Brian Abrams: In addition to the BET inhibitor, we're developing the mutant color antibody in the V617F inhibitor.
But in their...
Brian Abrams: In the relatively near term, we think that the BET inhibitor can provide a very good treatment options for patients with MF that progress up to JAKA5. That's why we are accelerating that second line program as much as we can. And we disclosed the basic design at ASH and you'll hear more of an update later this year.
Brian Abrams: In terms of first-line indication for the bed inhibitor, what we need are more data. We need...
Brian Abrams: more clarity on a the safety profile and the impact on endpoints that has a combination with JAKA-FYE in previously untreated patients. We showed an update that ASH, which we think
Brian Abrams: It's very encouraging in terms of the ability to combine our BET inhibitor with JAKA-FYE and the impact on spleen symptoms and, importantly, the impact that we saw on hemoglobin in the presentation that we gave at ASH.
Brian Abrams: So, we're still encouraged by the data, I think we need additional data to make that decision and to have another conversation with the FDA on a potential first study.
Brian Abrams: Thank you. Next question today is coming from Jay Olsen from Oppenheimer. Your line is now live.
Jay Olsen: Hey, congrats on the quarter and thanks for taking the question. For Ruxolitinib XR, also congrats on achieving bioequivalence, can you just talk about your plans to commercialize Rux XR?
Jay Olsen: and also the timeline for a fixed-dose combination with your BET inhibitor. Thank you.
Jay Olsen: It's a response to a CRL, so it's a slightly different timeline than we should be commercializing in 2026, which, if you look at the window it gives us versus the 2029 timeline, it's
Speaker Change: have as many patients as possible being treated with once a day, as a single agent, as Jessica Fye used today, in most indications, in most patients.
Speaker Change: So, none of that has been firmly decided yet, but that's probably going to be...
Speaker Change: Thank you. Next question is coming from Eric Schmidt from Cancer Pits. Gerald, your line is now live.
Imogen: Great, thanks. Two questions here. This is Imogen, on for Eric. The first one on POVO and HS.
Imogen: I guess, in terms of High School 75 as well, could you share any ranges of what you think would be meaningful and competitive data there in the evolving landscape?
Imogen: And then the second question is on the Tafasitimab first line in the LBCL study. What do you see as meaningful data there over the RTOP-LEN arm? Thanks.
Thank you.
Speaker Change: Okay, so on the first one, on POVNHS, I'm going to have to give a similar answer to what I've given earlier, which is obviously you want to see statistical significance for the primary endpoint. The key secondary endpoints obviously are not similarly powered, but they are important endpoints to show a clear difference with placebo. I don't think it's productive to really set...
a bar that we have to clear.
Speaker Change: If you look at the data from the phase 2 study with a 20% at week 12 and 13% placebo subtracted at week 16 for POVO, I think those are really strong results in the context of prior data releases in patients with HS. So if we are in the vicinity of those results, I think that's going to be a very important contribution.
Speaker Change: This is a top-line, first-line, the first-line DLV-CL study. As you know, this is a curative setting, so even a small impact on the primary input of the study, I think could be really, really important.
Speaker Change: And if you look at recent benchmarks such as the Polivy data, which showed a modest impact on PFS, it still has led to a substantial adoption of that in frontline patients.
Speaker Change: So, I think it's a very clear indication where modest improvements could lead to a potentially wide adoption because you're talking about potentially curative therapy.
Speaker Change: Thank you. Next question today is coming from Matt Phipps from William Blair. Your line is now live.
Matt Phipps: Yeah, thanks. Two for me. One, can you maybe just remind us on the learnings from the robust trial that were incorporated into FrontMind, where you think you can succeed when that trial fails? And then for the Mutant CalR program, is that just going to be monotherapy this year, or could we also get some Jackified combo? And can you remind us preclinically if you saw any differential activity between type 1 versus type 2 mutations in CalR? Thank you.
So, in terms of the mutant color antibody...
Matt Phipps: You know, we haven't really decided. We have initiated a combination with Jackify. The specific details of what we're going to disclose, we haven't really decided. But it's possible that we'll disclose some Jackify combination data. It's an important part of the development plan. You know, as we've discussed previously.
Matt Phipps: We don't necessarily commit to a combination development for the mutant color antibody, but it's possible that because of the really rapid and strong impact.
Matt Phipps: of Jaka Fye on patient symptoms, particularly as you know, as well as other endpoints.
Matt Phipps: A short induction with JAKA-FY combined with mutancolour and then a long-term maintenance therapy with mutancolour antibody could be a treatment paradigm. But none of that has been decided. We'll discuss the development plan, the future development plan for the mutancolour antibody when we disclose the data.
Matt Phipps: What we have disclosing to this type 1, type 2 is that these two types of mutations are very different in the structure.
Matt Phipps: in the gene and what we've discussed previously was that the affinity for the antibody for type 1 and type 2 is pretty different. In terms of what we expect to see in the clinic, we'll discuss that when we have the data results but it's possible that we have a different level of activity in patients with different types of mutations.
Speaker Change: Thank you. Next question is coming from Andrew Berens from Leering Partners. Your line is now live.
Andrew Berens: Thanks. Congrats on the big quarter in 2024. A couple more on Jackify XR. I don't think you commented on the CMAX. Wondering how that looked as you increased the dose to boost the CMIN. And is there anything else that's gating approval other than the stability studies?
Speaker Change: So, in terms of XR, so, look, you cannot replicate a CMAX with a once-a-day formulation compared with a twice-a-day formulation. The FDA understands that.
and that was not the purpose of the study.
Speaker Change: What you have to meet is obviously the AUC at steady state and the CMIN at steady state. As we disclosed in the slide deck, both of those endpoints were met.
Speaker Change: The only gating factor is the stability studies. As I mentioned in my prepared remarks, we have discussed the results of the study with FDA, and we have an agreement with them on the stability studies necessary for the resubmission, for the response to the CRL, and we expect that that will be done before the end of the year.
Speaker Change: Thank you. Next question is coming from Andy Chen from Wolf Research. Your line is now live.
Thank you for taking the question. So on POVO-HS again,
Andy Chen: Can you talk about specific protocol differences between your trial and other trials, especially from IL-17 antibodies? What have you learned from other trials and what might you be doing differently to amplify your efficacy here? And then also, in your base case scenario, are you expecting only the high dose to be approved or both doses?
Speaker Change: So, you know, and it is difficult to get into specific differences between studies because we don't have all the details of every protocol that's out there. We think that the design of the Phase III studies is consistent with the way
Our competitors are studying patients with Heteronatus Superativa.
Speaker Change: We designed a phase 3 to have a slightly higher percentage of patients with Hurley 3 as opposed to Hurley 2. That was an important point that we wanted to emphasize in order to reduce the placebo effect since it's harder in patients with more advanced disease and that was an important point that we wanted to emphasize.
Speaker Change: I think that there were a couple of things that we did, as well as, you know, we were careful in selecting sites. We run a series of trainings with the sites, which was consistent with what we did in the Phase II to make sure that
Speaker Change: The way these patients are assessed by the investigators is consistent with what we did in phase 2. So, we try to replicate in phase 3 as much as we did in phase 2.
Speaker Change: And obviously, as I mentioned earlier, you know, the primary endpoint we selected based on the phase two data. I think that was an important lesson in order to really see how quickly we can provide benefit to patients with a week 12 improvement, which also was the best endpoint for us in our phase two study.
In terms of the dose
Speaker Change: You know, when we have the data, we'll discuss with FDA, obviously. Yes, it's possible that if both doses are positive, we will lead to a broader label with different rates of doses, but we'll discuss that when we have the data with FDA.
Thank you.
Speaker Change: Thank you. Next question is coming from Salim Syed from Mizzou. Your line is now live.
Speaker Change: Hi, thanks for taking our question. This is Eric on for Celine. So just looking at modeling Jack Fye through 2025, just wondering how we should think about the change, the growth versus 2024 and how we should think about that through the year.
Speaker Change: more loaded in in first half, second half, anything like that. Thank you.
Speaker Change: So, the guidance range that we provided implies a year-over-year growth of 5 to 7 percent.
Speaker Change: In terms of how to model it through the year, remember that Q1 always is the lowest quarter and lower than the...
Speaker Change: get to spread it through the course of the year, it will continue to have more of an impact in the first quarter of the year. So expect Q1 to be the lowest quarter and lower relative to Q4 of 2024.
Evan Segerman: Thank you. Next question is coming from Evan Segerman from BMO Capital Markets. Your line is now live.
Evan Segerman: Hi guys, thank you so much for taking my questions. Two for me, just walk me through some of the initial assumptions for the pediatric obstetric launch. You know, what does this initial uptake curve look like and how much is factored into your guidance?
Evan Segerman: And second, kind of a hypothetical here, would you ever consider an ad alineumative head-to-head trial in HS versus POHO, given that you want to establish yourself as the systemic standard of care in this market? I'm just thinking as, you know, this is...
Evan Segerman: a biosimilar market you're coming in as a branded that could help you kind of getting a leg up here. Thank you.
Speaker Change: Yeah, Matteo, I'll take the A.D. pizza lunch. We're very excited about the opportunity that we have there to help these patients between 2 and 11 years old, also because the very vast majority of them are still uncontrolled and pretty much on steroidal therapies.
Speaker Change: Obviously in the second half of the year we will see the initial uptake from that indication contributed to our net sales, but overall in terms of sizing at peak we think that that opportunity will represent anywhere around 10-15% of the total topic dermatitis of the Lula business.
Let me take the second one.
Speaker Change: We have not discussed in the past whether to conduct a head-to-head study with Adalimumab.
Speaker Change: You know, there's a couple of points there. First of all, we...
Speaker Change: Let's wait to see the data for the HS1, for the two HS studies that are coming. Once we have the data in hand, we'll make decisions about future development.
Speaker Change: The challenge with the data that has been reported in the past with Humira, and when you discuss this between physicians, is that while the response rate that has been reported was high, and which has not been replicated since the original study.
Speaker Change: The drug failure on e-mirror is relatively fast. Patients with H.S. seem to progress relatively quickly.
Speaker Change: So, you know, this is one of the reasons why HS has become such an important market, such an important indication for a number of companies, because there's a fair amount of dissatisfaction with the data, with the results in the real world with Humera.
Speaker Change: So, at this point, we haven't made a decision to do a head-to-head study. Future development in HS, we'll discuss it after we have the data.
Speaker Change: Thank you. Next question is coming from Ash Verma from UBS. Your line is now live.
Ash Verma: How would that impact your value proposition for COBO in this market? Thanks.
Ash Verma: So, at risk of being repetitive, so if we look at the phase 2 data we've reported in a number of places, both week 12, week 16, and the totality of the data across all the endpoints, high score 50, 75, 90, and 100, and pain response, we think we have a very competitive profile with POVO.
Ash Verma: Assuming everybody has a certain level of correction from phase 2 to phase 3, we believe that when you put together all the efficacy data together with the safety profile we saw in the phase 2.
Ash Verma: that we have a very competitive profile with Biologics and certainly certainly with RIMBOC.
Speaker Change: Thank you. Next question is coming from Kripa Divericonda from Truist Securities. Your line is now live.
Speaker Change: Hey guys, thank you so much for taking my question. From Jessica Fye, it seems like PV is primarily driving growth. Can you talk about the patient population, where you're getting uptake, and what the expectations are in terms of growth? Is it primarily through new patient ads?
Speaker Change: or duration on therapy as well. And beyond RUX-XR and the V617F inhibitor, any additional life cycle management plans for your footprint in PV would seem to be growing. Thank you.
Speaker Change: I can speak, I mean, as you see, PV of the screen indication is the one that is growing the fastest and it is driven by earlier treatment.
Speaker Change: And that's based on the data we have shown that by treating early, you can basically reduce the incidence of thrombosis.
Speaker Change: So, basically, help patients have a longer thrombosis-free survival. That was the magic study that we have been...
Speaker Change: in PV. So we, as we said in the prepared remark, we think PV will become the largest of the three indications of our time, driven by this new patient...
Speaker Change: Mutation is the cause of 80-90% of PV cases in the US, so that will be the key driver of the next generation of products for Insight.
Speaker Change: Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over for any further closing comments.
Speaker Change: Thank you all for participating in the call today and for your questions. The IR team will be available for the rest of the day for any follow-up. Thank you and goodbye.
Speaker Change: Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.