Q4 2024 Vertex Pharmaceuticals Inc Earnings Call
Good evening, all my name is Susie Lisa and as the senior Vice President of Investor Relations. It is my pleasure to welcome you to our fourth quarter 2024 financial results conference call on Tonight's call, making prepared remarks, we have Dr. Ray Smoky, while her money for Texas, CEO and President Stuart Arbuckle, Chief operating Officer, and Charlie Wagner Chief Financial Officer.
We recommend that you access the webcast slides as you listen to this call. The call is being recorded and a replay will be available on our website. We will make forward looking statements on this call that are subject to the risks and uncertainties discussed in detail in today's press release and in our filings with the Securities and Exchange Commission. These statements.
Including without limitation those regarding for Texas marketed medicines for cystic fibrosis, sickle cell disease beta thalassemia and moderate to severe acute pain, our pipeline and vertex is future financial performance are based on management's current assumptions actual outcomes and events could differ materially I would also note that.
Select financial results and guidance that we will review on the call. This evening are presented on a non-GAAP basis I'll now turn the call over to Rachel.
Rachel: Thanks, Susie good evening, all and thank you for joining us on the call today before diving into Q4 and full year earnings I'd like to provide a quick update on some leadership changes planned for mid 'twenty 'twenty five as noted in our press release Stuart Arbuckle will be retiring on July one of this year after all.
Rachel: Most 40 year career in Biopharma and a stellar dozen plus years at vertex first as Chief commercial Officer, and then S. T O O.
Speaker Change: So where we imagine the vertex commercial organization as the company transitioned from hepatitis C. I'm in semic to establishing itself in CF and since then he has led this vertex as chief commercial officer, and Chief operating officer with Great skill and innovation Stewart has been at the helm, who the launches and commercialization.
Speaker Change: All of our C F T. Our modulators, beginning with Kalydeco and all the way through to a lift truck. He has also helped develop and lead the organization into this new era of commercial diversification with the launches of cast gebbie and your Nymex.
Speaker Change: Anyone who has had the privilege to work with Stuart as I have no Stuart to be a consummate professional and incredible leader and an excellent developer of talent. He's uncommonly poised leads with integrity and always put patients first as.
Speaker Change: As part of our carefully planned succession Stuart is fully on board I've heard tax until July which will allow for a seamless transition.
Speaker Change: While we still have many months before he retires I want to take this opportunity to convey my deep gratitude for his partnership and for all that Stuart has done for vertex.
Speaker Change: We are very thoughtful and deliberate in how we plan for senior leader succession, and we always do so with a long time horizon in mind. Thanks to careful planning we have never been in a stronger position to pass the baton from Stuart to other experienced senior leaders and we are very confident that the transition will enable us to execute.
Speaker Change: Seamlessly on the significant opportunities ahead in that regard I am very pleased to announce that Charlie Wagner, who joined as CFO in April of 2019, and whom all of you know very well will take on the additional role of C. O O on July 1st I'm equally pleased to announced that Dunkin' Mckechnie.
Speaker Change: Our longtime SVP and head of the North American commercial team will be promoted to EVP and Chief Commercial officer also on July one Duncan.
Speaker Change: Duncan had over 20 years' experience in the industry across a wide range of strategic operational and commercial roles in multiple disease areas and geographies at both GSK and novartis prior to joining vertex 12 years ago Dunkin'.
Speaker Change: Duncan has been working side by side with Stewart since 2013 during which time. He played an instrumental role architected. The successful launches of all of our CF medicines as well as the cash JV in genomics launches in the U S.
Speaker Change: In addition to his role as the commercial head of North America. Since 2022. Dunkin' has also led the global health economics, as well as the global value and access functions across the entire vertex portfolio.
Speaker Change: I'm proud of the deep bench of outstanding talent, we have at vertex and I'm looking forward to working directly with Dunkin' as he joins the executive committee and steps into the C. C O role and as Charlie continues as CFO and ads C. O L responsibilities in July moving to earnings fourth quarter performance wrapped up.
Speaker Change: Another strong year as the continued outstanding commercial execution and C. F helped us drive double digit revenue growth for our 10th consecutive year and the launch of cast Gebbie set us on the course of revenue diversification, we continue to reach more patients and delivered 2.91 billion in revenue in the fourth quarter representing.
Speaker Change: 16% growth versus Q4, 2023 for the full year 'twenty 'twenty four revenue reached a new milestone of just over $11 billion, plus 12% versus 2023 and exceeded our full year product revenue guidance of 10.8 to 10.9 billion from the strong base in 2025.
Speaker Change: We are focused on driving a significant expansion in the patients we serve with the ongoing launch of catch Gebbie and two recent U S. NDA approvals a lift truck our next generation fifth CF medicine approved on December 20th.
Speaker Change: <unk> approved for moderate to severe acute pain on January 30th.
Speaker Change: <unk> approval is landmark as it represents the first oral non opioid pain signal inhibitor and the first new class of pain medicine in over 20 years, we see this approval as significant for millions of patients for vertex and for society as an important option to support.
Speaker Change: Public health efforts to curb the opioid epidemic.
Speaker Change: Our R&D teams have worked on this program for many years and it is indeed my privilege to acknowledge their efforts and also to thank the patients and health care providers, who participated in the clinical trials and made this approval possible with these two recent approvals for our lift truck in genomics in hand, and the continuing cash.
Speaker Change: <unk> Global launch we have a keen focus on commercialization and our teams are working to secure broad access and reimbursement for patients who are waiting.
As I detailed in January as the number of inline approved medicines grow and the late stage pipeline advances, we anticipate significantly expanding the number of patients we serve over the coming years in 'twenty 'twenty four our transformative therapies have the potential to serve approximately 160000 patients with CF.
Speaker Change: Sickle cell disease, and transfusion dependent beta thalassemia now, we can add 80 million acute pain patients to that reach thanks to the approval of genomics and beyond moderate to severe acute pain, focusing just on the mid and late stage pipeline, we seek to serve more than 5 million more patients, including those with type one diabetes.
Speaker Change: Ladies and certain renal diseases, and then another 10 million plus patients with peripheral neuropathic pain in the U S alone.
Speaker Change: To give you a sense of our momentum we are on track for key clinical development milestones in three pivotal studies. This year first completing enrollment and dosing in the semi Lasalle phase 123 study in type, one diabetes, which would position us to file for regulatory approval. Once this cohort has.
Speaker Change: Follow up with one year of insulin independence second completing enrollment in the interim analysis cohort a pub attached the sep in igen, which would position us to file for potential U S accelerated approval once that cohort reaches 36 weeks of treatment and third completing enrollment in the interim.
Speaker Change: This cohort for Enoxaparin for a M kt, which would position us to file for potential U S accelerated approval once that cohort, which is 48 weeks of treatment. In addition, we continue to execute the phase III study of sector gene in patients with diabetic peripheral neuropathy, we're also making strong progress with VX nine.
Speaker Change: Nine three the next generation NAV, one eight inhibitor in both moderate to severe acute pain and diabetic peripheral neuropathy. We also have ongoing trials the potentially transformative medicines like VX 670 in my Atonic dystrophy type one corporate taxes stepped in a basket study in indications beyond ICANN and expect to move back.
Speaker Change: Four seven for autosomal dominant polycystic kidney disease into phase two this summer.
Speaker Change: It's truly an exciting Arab broad diversification at vertex in terms of the revenue base, our pipeline and our geographic presence given the detailed clinical update we provided in January I'll focus the R&D updates Tonight on CF and our clinical stage renal pipeline.
Speaker Change: Starting with C F. The U S launch is underway for our lift truck the fifth vertex see FTR modulator regimen. While we are also working to secure approval in international regions as we work to get a lift truck to patients around the globe. We are already in the clinic with our next generation C. F. T R modulator regimen.
Speaker Change: With E C. F T R modulator regimen that gains approval, we raised the bar ever higher for ourselves and the field as a whole as we continue our mission to bring all patients with CF to normal levels of C. F. T. R function. We term tried captor Caf trio the next generation see FTR modulator or <unk>.
Speaker Change: N G. One point out of left Trek is N G to point out.
Speaker Change: E. N. G 3.0 regimen consists of VX 828, CFT, our collector VX 118 C. F T R potentiate or and Tessa captor. This N. G 3.0, Triple combo regimen has shown even greater efficacy in other words, even greater improvement in C. F. T are dependent chloride transport.
Speaker Change: Dan in lift truck in our CF human bronchial epithelial cell assays, which have been shown to be highly predictive of clinical outcomes. We expect this regimen to be in the clinic in a study of CF patients this year.
Speaker Change: We also continue to enroll and dose the mad portion of the phase one two study of VX 522 for the 5000, plus patients who cannot benefit from our CF GR modulators results from the Mad portion of the study are expected later this year.
Speaker Change: Moving on now to what I see as a real Renaissance in renal therapeutic drug development. We are focused on advancing potential therapeutics that hold the promise to treat the underlying cause of disease in three different severe renal conditions first and ask the blend for April one mediated kidney disease or a M. K D.
Speaker Change: As mentioned, we are working towards our goal of completing enrollment of the interim analysis cohort of the pivotal amplitude study. This year amplitude is the study of primary a M. Kt that is to say patients with two April L. One allele and no additional renal comorbidities.
Speaker Change: After completing enrollment when this cohort reaches 48 weeks of treatment, we'll conduct the interim analysis, if positive we will be able to file for potential accelerated approval in the US In addition, I am pleased to announce that last month, we initiated a new study amplified which is a phase two proof of concept study.
Speaker Change: Maxibolin in patients with a M KD and other comorbidities, including type two diabetes second pole metastasis.
Speaker Change: Dual antagonist of the April and Bath cytokines, which play key roles in the pathogenesis of B cell mediated autoimmune diseases.
Speaker Change: <unk> dual inhibition mechanism of action, the preclinical and clinical data to date, plus toby's once monthly dosing frequency and small volume subcutaneous route of administration give us high confidence in its promise as a transformative medicine for patients with IGN and other b cell mediated does.
Speaker Change: Seizes as mentioned in January we expect to complete enrollment of the interim analysis cohort of the <unk> study in I again. This year to this end I am pleased to report that we've now opened more than 100 clinical trial sites in more than 20 countries, including in the U S Euro.
Speaker Change: And Asia, and enrollment and dosing are well underway. Once this cohort has 36 weeks of follow up we will conduct the interim analysis and if positive it would support filing for a potential accelerated approval in the U S and third and earlier stage renal program that represents an additional.
Speaker Change: Significant opportunity VX four seven in autosomal dominant polycystic kidney disease or a D. P. K D, where we are nearing completion of the phase one trial ADP Kt is the most common severe monogenic disease amongst caucasians and the most common inherited cause of <unk>.
Speaker Change: <unk> renal disease in the U S and globally, an estimated 300000 people in the U S and Europe are living with a D. P. K D. Yet there are no treatments that address the underlying cause of disease. It is a life shortening disease that is characterized by the growth of numerous FIS.
Speaker Change: That impaired kidney function and can ultimately lead to kidney failure around half of patients with ADP KD experienced kidney failure by the age of 60.
Speaker Change: The majority of ADP Katie cases are caused by variants in the PK be one gene, which encodes the polycystic one or P. C. One protein. These inherited variance lead to the loss of P. C. One function that leads to the proliferation of kidney epithelium cells increase fluid secretion and the fall.
Speaker Change: <unk> and expansion of fluid filled since the.
Speaker Change: The progressive cyst formation causes an increase in kidney size and decline in kidney function VX.
Speaker Change: VX four seven is a first in class small molecule protein folding corrected that is designed to target the underlying cause of a D. P. K D by correcting P. C. One folding to restore function. This has the potential to arrest says growth.
Speaker Change: By way of its mechanism of action VX 407 has potential in a subset of patients with protein folding mutations of PK D. One estimated at up to 30000 patients or about 10% of the overall ADP Katie population as we're doing in CF, we seek to see.
Speaker Change: Really innovate and overtime reached the full 300000 patients with a D. P J D.
Stuart Arbuckle: For VX four seven we expect to complete our phase one studies soon and if the results are supportive advanced to phase. Two later this year with that review I'll turn it over to Stuart for a commercial update.
Stuart Arbuckle: Thank you very much rushmore.
Speaker Change: While I admit to having very mixed emotions at retiring from vertex in July I know that the timing is right from both the professional and personal standpoint, it's been an amazing journey at vertex over the last 13 years as we've executed on our unique and differentiated strategy to develop and commercialize transformative medicines for patients with CF sickle cell.
Speaker Change: Disease beta thalassemia, and pain and I'm very confident we will successfully develop many more transformative medicines such as in diabetes renal in autoimmune diseases from our broad late stage clinical pipeline. The business has never been in a better position scientifically and commercially than we are today.
Speaker Change: I'm also highly confident that we have developed the right talent to maximize these significant opportunities I'm thrilled to transition leadership of our outstanding commercial organization to Duncan as the new CCL I've now.
Speaker Change: Duncan for decades, and recruited him to vertex. He brings a rare combination of outstanding strategic thinking results focused operational excellence and people management skills and I have every confidence he will help lead the company to even greater heights, Although I will see many of you between now and July I'd like to take this opportunity.
Speaker Change: 80 to thank all our shareholders and analysts for your support and engagement over the years and I look forward to helping you get to know Duncan over the coming months with that I will focus my comments Tonight on our three recent launches, including the early U S launch of our lift truck the continuing global launch of cash Debbie building on the foundation we established.
Speaker Change: <unk> in 2024, and the initial launch of generics in acute pain, starting with CEA. Once again, we delivered strong CF results for the quarter and the full year as we further grew the number of eligible patients taking off see FTR modulators, we made rapid regulatory and reimbursement progress in 2020 for enabling.
Speaker Change: US to expand to younger patients patients with rare mutations in patients in new geographies Ilife Trek is now our fifth see FTR modulator approved to treat the underlying cause of CF. We were pleased with the early approval of a lift truck, which in clinical trials has demonstrated non inferiority on lung function to try CAFTA the current standard.
Speaker Change: Care for eligible patients with CF electric clinical trials also demonstrated further improvement since the FTR function as measured by sweat chloride. We believe this profile along with the convenience of once daily dosing sets the stage for a lift track potentially become the new standard of care in CF Electric is also approved.
Speaker Change: For an additional 31 mutations that are not covered by the Tri cap the label and finally, our lift truck carries a meaningfully lower royalty burden for vertex and extends our composition of matter patent protection from 'twenty thirty-seven FITZROY captor into 'twenty thirty-nine for a lift truck we have received positive feedback from physicians and.
Speaker Change: <unk> for Lyft Trek early insights show enthusiasm for a new option that offers the convenience of once daily dosing to simplify treatment and expanded eligibility for many patients who are today not being treated with a C. F. T. R modulator, including those who have one of the 31 ran mutations that are not responsive to our other C. F T.
Speaker Change: Our modulators in these early days of the launch centers are familiarizing themselves with the data and the liver monitoring requirements to frame conversations about initiation with naive discontinued and potential switch patients. We have seen interest in our lift truck from all of these groups of eligible patients and I'm pleased to report that the first patient.
Speaker Change: <unk> have already initiated treatment with a lift track.
As we think about the uptake of a lift truck we are confident that CF patients will seek the best medicine for them.
Speaker Change: And we believe that for the majority of patients that is a lift truck.
Speaker Change: We expect that the short term liver monitoring requirements to initiate Ilife trek will be considered in the context of the potential for a lifetime of improved C. F T cell function and the benefits of once daily dosing.
Speaker Change: Outside the U S regulatory reviews are underway for our lift truck, including in the United Kingdom European Union, Canada, Switzerland, Australia, and New Zealand, we look forward to the potential approvals of this best in class Medicine in these markets in 2025.
Speaker Change: Now turning to cash JV, our transformative onetime treatment for patients with sickle cell disease and beta thalassemia. It is just over a year since the historic approval of cashed JV, which has been enthusiastically received by patients physicians payers and policymakers and the launches gathering momentum across all regions too.
Speaker Change: Important markers of our launch progress R. A T C activations and patients cell collections as we reported in January we exited 2024 with more than 50 authorized treatment centers well on our way to our goal to activate approximately 75 total 86 globally.
Speaker Change: Proximately 50 patients across all regions had their first sell collections in 2024 and patient infusions of cash gebbie edited cells have already occurred in both the middle East and the U S. We continue to make exciting progress in the middle East in November of 2023 in January of 'twenty 'twenty four we secured.
Speaker Change: Regulatory approvals in Bahrain in KSA, respectively, and on December 31st 2024, which secured regulatory approval in the United Arab Emirates, We are working to expand further in the region with anticipated filings in Kuwait and Qatar later this year.
Speaker Change: In this region, we now have national reimbursement in Bahrain Hospital based coverage in Saudi Arabia and are working towards coverage in the United Arab Emirates, continuing with the payer landscape. We recently reached a reimbursement agreement with NHS, England for the treatment of patients with sickle cell disease. This means that eligible sickle cell disease.
Speaker Change: Beta thalassemia patients now have access to cash do you have you're in England in.
Speaker Change: In the U S. Both S C D and T D T patients have access either through private insurance, where over 250 million lives are covered or through single case agreements and in the Medicaid segment as of last month States may now begin to apply to participate in the CMI cell and gene therapy access model, which we believe will further.
Speaker Change: Spanned access for eligible patients as states May then subsequently opt in to the CMS negotiated agreements. We are focused on leveraging the foundation, we established for cast JV in 2024 to build momentum in 2025 and beyond for this multibillion dollar opportunity as we work to get this transformative therapy to more.
Speaker Change: More and more patients around the world shifting now to genetics in acute pain. As we are currently 10 days post the milestone approval of this first selective oral non opioid pain signal inhibitor. The approval is so critical because genetics represents the first new class of pain medicine in over 20 years. It combines.
Speaker Change: Effective pain relief with a favorable safety profile and based on its MLA. It does not have addiction potential. It is indicated for use across all types of moderate to severe acute pain. For example, post surgery broken bones sports injuries and has the potential to establish a new standard of care for the 80 million patients.
Speaker Change: Who seek a prescription therapy to treat moderate to severe acute pain each year in the U S half of those seeking help for their acute pain or approximately 40 million Americans. Each year are prescribed opioids, which although effective have significant safety and tolerability concerns and addictive potential in fact tragically.
Speaker Change: An estimated 85000 people each year will develop opioid use disorder within the first year of being prescribed an opioid for acute pain. We believe we now have the opportunity to transform how acute pain is treated in the U S and to build another multibillion dollar franchise for vertex.
We will launch ready for the Paducah date and have now begun commercialization of genetics. Our focus for 2025 is to engage with health care professionals formulary decision makers and payors to establish the conditions for rapid patient access that will deliver long term commercial success for our pain franchise to that end while still just.
Speaker Change: A few days into the launch we believe that the incredibly broad positive media coverage genetics has received since approval is one measure of the high unmet need and an indication of the societal importance of providing both physicians and patients with a new non opioid option for the treatment of acute pain, we've already seen tremendous.
Speaker Change: Interest and requests for information from both doctors and patients and we look forward to being able to serve them.
Speaker Change: Our 150 person sales force is actively engaging with health care providers and physicians on the compelling efficacy and safety data of generics and its role in all types of moderate to severe acute pain.
Speaker Change: In the institutional setting we are engaging with roughly 2000 high volume hospitals, and approximately 150 related health systems.
Speaker Change: We have line of sight to accelerate the typical PMT committee processes in many networks to support the use of generics in this setting we are advancing our discussions with national and regional payers and group purchasing organizations to provide access to generics building on our work preapproval to accelerate formulary reviews and limit any.
Speaker Change: Appropriate utilization management controls and largely with retail pharmacies, we are working to secure broad stocking agreements at national retail pharmacies and regional chains to ensure availability of generics for patients across the country. We have also now begun our non personal promotional initiatives to physicians and patients to.
Speaker Change: Promote broad awareness of the first oral non opioid pain signal inhibitor for moderate to severe acute pain, such as embedded content in relevant websites like med scape for physicians and webmd for consumers along with point of care marketing.
Speaker Change: Furthermore, we continue to see momentum and interest by policymakers, both on the federal and the state level in providing equal access to non opioid options for pain really.
Speaker Change: No Pain Act launch on January the first and provides a Medicare add on payment for non opioids used in the hospital outpatient or ambulatory surgery center settings.
Speaker Change: We expect generics to be added near term to the list of medicines approved for this add on payment.
Speaker Change: The alternatives to paint Act had 78 co sponsors from both parties last year and is expected to be reintroduced in the new Congress with similar and growing support.
Speaker Change: Additional federal and state initiatives also continued to progress for example, just six weeks into 2025 17 states have already introduced legislation to support the use of non opioid options, adding to the seven states that enacted legislation for Medicaid and state regulated plans in 2000.
Speaker Change: 24, we expect more states to join this movement.
Speaker Change: On the pricing front, we have price generics at $15 50 per pill or $31 per day at list price. We believe this price strikes a balance between ensuring broad access with the benefits it brings to patients and society, including the cost offsets that generics may provide it also recognizes our 20 plus year.
Investment in pain and significantly we feel that this pricing enables us to continue to invest so that we can be the leader in serving patients with acute and chronic pain for decades to come.
Speaker Change: As previously discussed in the early months of the launch we are strategically investing in initiatives, including financial assistance programs for eligible patients that enables smooth rapid access for patients prescribed genetics, which is critical given the acute nature of the condition and lastly, we expect to start shipping genetics.
Speaker Change: Our wholesalers by the end of this month with retail availability a few days later to conclude we had a very strong commercial execution throughout 2024 and are already executing on multiple launches and growth opportunities ahead of us in 2025, we are in a new and exciting era of.
Charlie Wagner: <unk> diversification with the ongoing global launch of cashed JV the launch of a lift trekking sphere and genetics in moderate to severe acute pain in the U S. I'll now turn the call over to Charlie to review the financials.
Charlie Wagner: Thanks, Stuart vertex has excellent results in the fourth quarter of 'twenty 'twenty four demonstrate once again, our consistent strong performance and attractive growth profile fourth quarter 'twenty 'twenty four total product revenue increased 16% year over year to 2.91 billion, including revenue growth of 17% in the U.
Charlie Wagner: <unk> and 14% outside the U S. The exceptional U S. CF revenue growth in the quarter resulted from continued strong patient demand and the effect of the January 2020 for a price increase as well as a favorable gross to net dynamic X U S revenue growth was driven by strong CF performance in many established markets.
Charlie Wagner: As well as in newer markets, where we have recently transitioned to long term reimbursement agreements revenue in the quarter also benefited from certain nonrecurring items full year revenue of 11.02 billion represents 12% growth versus 'twenty twenty-three, our 10th consecutive year of double digit growth fourth quarter 2024 come.
Charlie Wagner: Bind non-GAAP R&D acquired IP, R&D and SG&A expenses were $1 3 billion, an increase of 29% compared to 1 billion in the fourth quarter of 2023. The most significant areas of increased investment versus prior year included the pivotal studies for type one diabetes I again, a M K D and D. P N S.
Charlie Wagner: As well as the build out of capabilities for both our expanding pipeline and ongoing commercial launches also included in Q4 2024 results our $88 million of acquired IP R&D expenses, including for the Orna collaboration to develop next generation in vivo therapeutics for sickle cell disease and beta thalassemia. This compares to 18.
Charlie Wagner: <unk> of such charges in the fourth quarter of 2023.
Charlie Wagner: Full year 'twenty 'twenty four combined non-GAAP R&D acquired IP R&D and SG&A expenses were 8.82 billion compared to 4.24 billion. In 2023 included in full year 'twenty 'twenty. Four results are 4.63 billion of acquired IP R&D charges with the vast majority of resulting from the alpine immune Sciences acquisition.
Charlie Wagner: <unk> acquired IP R&D charges were $527 million for the full year 2023, the year over year increase in R&D expenses was driven by continued investment in our pipeline, including four ongoing pivotal studies the year over year increase in SG&A costs was primarily driven by investments in our commercial organization to support the launches.
Charlie Wagner: <unk> of genetics and cursed Chevy.
Charlie Wagner: Fourth quarter 2024, non-GAAP operating income was $1 2 billion compared to 1.15 billion and non-GAAP operating income in the fourth quarter of 'twenty twenty-three full year 2024, non-GAAP operating income was $696 million compared to 4.3 dollars 7 billion in 2023 recall that full year 'twenty 'twenty four.
Charlie Wagner: non-GAAP operating income reflects a 4.4 billion dollar charge for acquired IP R&D from the acquisition of Alpine.
Charlie Wagner: <unk> fourth quarter 2024, non-GAAP effective tax rate of 21, 3% was in line with our expectations, while our 16.3% tax rate in Q4 twenty-three benefited from higher U S. R&D tax credits are full year 'twenty 'twenty four effective tax rate of 91% reflects the non deductibility of the alpine acquired IP R&D.
Charlie Wagner: Charge, our non-GAAP effective tax rate in 2023 was 19.4%.
Charlie Wagner: Fourth quarter 2024, non-GAAP earnings per share were $3.98 compared to $4.20 in the fourth quarter of 2023, largely as a result of lower interest income and the tax rate differential previously noted full year 'twenty 'twenty four non-GAAP earnings per share were <unk> 42 cents compared to $15 and 23.
Charlie Wagner: In 2023 for reference the alpine AIP R&D charge equates to roughly $17 on a per share basis. We ended the quarter with 11.2 billion in cash and investments our priorities for cash deployment remain unchanged as we continue to prioritize investment in innovation, including external innovation by a business.
Charlie Wagner: Development. We also continued our share repurchase program and deployed approximately $1 2 billion to repurchase 2.7 million shares over the course of 'twenty 'twenty four including 961000 shares in the fourth quarter.
Charlie Wagner: Now switching to guidance for 2025, we expect total revenue in a range of 11.75 to 12 billion representing growth of approximately 8% at the midpoint at current exchange rates with the U S is the main driver of total revenue growth. This outlook reflects our expectation for continued growth from our portfolio of CF medicines.
Charlie Wagner: Including the U S launch of our lift truck note that ex U S. CF revenue growth will be impacted by a reduction of revenue in one country outside our core markets, where certain intellectual property rights are being violated this impact will be most pronounced in Q1 as the increases in international channel inventory that occurred in Q1 of 'twenty.
24 will not repeat in Q1 2025 guidance also includes a continued ramp up in cash Chevy revenue as we treat more patients and approved geographies given the very recent approval of genetics guidance also reflects the contribution from this launch in the U S. Primarily in the back half of the year, we expect genetics volumes.
Charlie Wagner: To ramp up ahead of revenue as a result of financial assistance programs that are designed to provide eligible patients with immediate access while we work to secure broad sustainable payer coverage to give you context on the launch progress of genetics, we will provide metrics on total covered lives and prescription data over the course of 'twenty twenty-five also.
Charlie Wagner: Note that the expected benefit to gross margin in 2025 from the lower royalty rate on a lift truck will largely be offset by the higher cost of goods on our other new product launches as they scale towards their long term margins for combined non-GAAP R&D acquired IP R&D expenses and SG&A, We project a range of four.
Charlie Wagner: Point $9 billion to $5 billion for the full year 2025. This guidance includes approximately 100 million and currently anticipated IP R&D charges. We will continue to invest a majority of our operating expenses into R&D given the momentum in our multiple mid and late stage clinical development programs the costs for four phase.
Charlie Wagner: <unk> three studies were a driver of increased investment in Q4 24, and this trend will continue over the course of 2025 with the four phase III studies, continuing and multiple phase twos ongoing as well the increase in commercial costs in 2025 supports our increasingly diversified commercial portfolio and reflects a full year of inverse.
Charlie Wagner: <unk> to support the launch of genetics as well as targeted spending on commercial capabilities for future potential multibillion dollar opportunities in renal therapies Enzo myeloid cell for example, given our differentiated business model and focus on specialty markets. We can make these targeted investments, while maintaining attractive profitability and cash flow.
Our full year 2025, non-GAAP effective tax rate is expected to be in the range of 25% to 21.5% in closing vertex delivered excellent results yet again in 2024, achieving strong revenue growth advancing our cast gebbie launch and gaining important regulatory approvals that.
Charlie Wagner: <unk> us for commercial launches all while continuing to make significant pipeline progress across the portfolio. We are now launching two new products in the U S driving the cast Chevy global launch and enrolling four phase III studies with three of them expected to reach significant enrollment milestones this year.
Charlie Wagner: These and other anticipated milestones of continued progress in multiple disease areas are detailed on slide 16, we look forward to updating you on our progress on future calls and are now as Susie to begin the Q&A period.
Charlie Wagner: We will now begin the question and answer session.
Charlie Wagner: To ask a question you May Press Star then one on your Touchtone phone.
Charlie Wagner: If youre using a speakerphone please pick up your handset before pressing the keys if at anytime. Your question has been addressed and you would like to withdraw. Your question. Please press Star then two and at this time, we'll pause momentarily to assemble our roster.
Solving Richter: And our first question will come from solving Richter with Goldman Sachs. Please go ahead.
Solver Richter: Good afternoon, and thanks for taking my question.
Speaker Change: And actually we really aren't going to Miss you and Duncan welcome.
Solver Richter: Here.
Speaker Change: Maybe just going back to my question on <unk> can you further elaborate on prelaunch efforts in our retail pharmacies in the PMT Committee review processes and how you can work to accelerate these aspects and then secondly on your mrna program in cystic fibrosis, and maybe frame for us.
Solver Richter: Do you think of success here. Thank you.
Yeah.
Solver Richter: Savi, let me turn it over to Stuart first and then I'll come back to the mrna question Stuart Yeah, Hey, solving thanks for the kind words.
Solver Richter: So in terms of our work with retail we've been working with the largest national retail chains and also regional chains to ensure that we get broad availability of generics.
Solver Richter: Across the U S.
Solver Richter: And it's very important obviously to have broad availability, because we want the product to be there when a patient in acute pain turns up with their prescription because they obviously can't wait and as I said in my prepared remarks, we are expecting.
Solver Richter: To have the product with wholesalers by the end of this month and in retail shortly thereafter, and I am expecting that we will have broad availability across the entire U S.
Solver Richter: In terms of our work with payers on their approval processes and also institutions on as Preapproval, we were working on them compliant lead to provide them with information that they need such as the full clinical profile of the medicine. Obviously now we also have the established price, which is an important component.
Solver Richter: Good for them as well.
Solver Richter: And we do have indications that people are looking.
To move quickly to provide access to do genetics, given the benefit risk profile and we'll keep you updated on our progress with that over the next few weeks and months.
Solver Richter: And so I mean on your question with regard to mrna. So these are the last.
5000, or so patients they have no options available to them and so if I think about the approved medicines or can be on the one hand with about a 3% improvement in P. P. F. E V. One and then try Kafka and a lift track on the other side with about a 14% improvement in P. P. F E V. One.
Solver Richter: And because the mrna VX 522 is an inhaled therapeutics, we're not expecting any movement on sweat chloride. So this would be a read out on P. P. F E V. One and any number between 3% and 14% would be just fine and of course, if it's more than that that would be acceptable as well, but based on the approach.
Solver Richter: Madison I think you can look at a range from 3% to 14% as what would be important if you translate the 3%, let's say, that's what or can be hacked into long term outcomes remember that the 3% in acute improvement in P. P F. Even want translate into a 50 plus percent.
Solver Richter: Improvement or reduction in pulmonary exacerbations.
Solver Richter: Yeah.
Speaker Change: The next question will come from Evan figure men with BMO capital markets. Please go ahead.
Evan Figur: Well. Thank you so much for taking my question and congrats on a strong 24 and a great start to 2025 also Stewart Congrats on your retirement, it's been an honor to watch you really transformed the company. So I want to touch on different about it talk to me a little bit about how your early discussions with payers have been progressing.
Speaker Change: Many covered lives do you expect to have.
Speaker Change: Access to therapy when it is in the retail channel and how is that going to change over the course of the year. Thank you so much.
Evan: Hey, Evan again, thanks for the kind words I appreciate it and let.
Evan: Let me just reassure everybody I'm gonna be here until July the first at 100% focused on driving the generics launch.
Evan: And cast JV and our lift truck as well in terms of our payer discussions we were having a payer discussions prior to the approval and obviously we've continued to have the post approval Avon.
Gone really well I think it's no surprise everybody is acutely aware of the unmet need.
Evan: To have better treatment options and opioids and everybody is excited about the fact that this is the first non opioid for decades.
I am expecting that we will get broad access over time and I expect it to grow over time, we're not giving specific.
Evan: Expectations or guidance on exactly how many covered lives we expect at what point through the year, but obviously, we are expecting it to grow throughout the year as more payers.
Evan: He used to put a generics on their formulary.
Speaker Change: The next question will come from Jessica Fye with J P. Morgan. Please go ahead.
Jessica Fye: Hey, guys. Good afternoon, Thanks for taking my question.
Speaker Change: Thinking about the 2025 topline guidance it seems like that.
Speaker Change: Largely driven by C. F. I was wondering if you could talk about how we should think about the U S versus ex U S contribution to that growth rate.
Speaker Change: And and kind of what what's driving those respective growth rates in the U S and outside the U S. Thank you.
Speaker Change: Charlie.
Charlie Wagner: Yeah, just thanks for the question.
Charlie Wagner: Our guidance range of $11.75 billion to $12 billion as we highlighted in the prepared remarks represents 8% at the midpoint, we did call out in the prepared remarks sort of the differential between the U S and ex U S. You think about what's going on thinking about 'twenty 'twenty four obviously, we continue to see very.
Charlie Wagner: Strong growth in the CF business around the world.
Charlie Wagner: We expect that to continue into 2025 U S has the benefit of the electric launch as well as the genetics launch in addition to ramping cast JV and the ongoing growth in CF. If you think about international will see strong growth in CF in most markets. We did call out that there is one country.
Charlie Wagner: Where our IP is not being respected.
Charlie Wagner: That has an impact on the ex U S growth rate that'll be most pronounced in visible in the first quarter. So we thought we would call that out for you and then obviously the cast Eddie launch continues to ramp ex U S. As well so with those dynamics there is a little bit of a difference between between the U S and ex U S. In 2025.
Charlie Wagner: But overall, a very healthy growth rate on the top line for us.
Okay can I just throw in a follow up I think you also mentioned the four key revenue benefited from some nonrecurring items to quantify that at all.
Charlie Wagner: Yeah, I'm not going to get into that I'll, just qualitatively I'll tell you what the fourth quarter was very strong growth in the U S was driven by strong volume in CF as well as the benefit from the price increase that we took earlier in the year.
Charlie Wagner: In addition, we saw very favorable gross to net dynamic in the U S. Gross to net fluctuate honestly from quarter to quarter typically it's a little more negative in the first quarter, but.
Charlie Wagner: But we did see a meaningful benefit in the fourth quarter.
Charlie Wagner: Outside the U S again strong volume growth in CF. We did also have the benefit of some one time items things like that rebates and some other settlements that we worked out in different markets those don't reoccur necessarily every quarter.
Charlie Wagner: Okay.
Charlie Wagner: Thank you.
Charlie Wagner: The next question will come from Geoff Meacham with city Citibank. Please go ahead.
Geoff Meacham: Great afternoon, everyone. Thanks for the question also on the offer up congrats to the Stewart as well as Charlie in downtown just on all the announcements today.
Charlie Wagner: So just on genetics and L. A S R.
Charlie Wagner: I know you guys have taken a deep dive into the phase two and maybe you've got some.
Some chaos feedback are there any more considerations.
Speaker Change: You're thinking about for phase III design, I know, you're still awaiting regulatory feedback, but wanted to get your your perspective on that and then second question is on a lift truck.
Speaker Change: Wanted to get maybe any early anecdotes from you guys on you know on new patients new patients coming into care.
Speaker Change: Either just qualitative or quantitative feedback on those that are perhaps not on.
Speaker Change: Try CAFTA or unmet need populations. Thank you.
Speaker Change: Sure thing Geoff I'll take the <unk> question, and then I'll ask Stuart to comment on the lift truck. So you actually have it exactly right. The big thing that we're waiting for is our end of phase two meeting with the regulators, where we are with our analyses is our teams are very deep into their analysis.
Speaker Change: <unk> of everything we can possibly gleaned from the phase two we are out talking to not only key opinion leaders, but P is and those who are very involved in viewing LFR studies and we are preparing ourselves for a regulatory meeting I'll have more to share with you. This summer.
Speaker Change: But I don't have an update I'd, rather collect all of this and presented to you all at once in the summer after we've gone through our regulatory interactions and obviously the really big thing that we are looking to understand is what we FDA would like to see what is the packages are what they were.
Speaker Change: We need to include in the package for this broad pnp indication that we seek.
Speaker Change: Stuart Yes on electric Jeff we've seen strong interest from patients who are either kind of naive have never been on the CFT, our modulator and in particular, those who are now eligible for CFT. Our molecule modulator now electric is approved which as you know has the additional mutations.
Speaker Change: <unk> over and above even try catheter. So we've seen strong interest there as you would might as you might expect.
Speaker Change: But we've also seen interest in transition patients those who own something like try captive, but also those who previously discontinued so we've seen interest across all three of the populations that we were expecting and I'm pleased to say that the first patients have already.
Speaker Change: Received their first prescriptions and already received their first packs of our lift truck, which is great to see.
Speaker Change: Great. Thank you guys.
Speaker Change: The next question will come from Michael Yee with Jefferies. Please go ahead.
Speaker Change: Thank you for the question.
Hopefully youre, not making me nervous going into the acute pain launch.
Speaker Change: But.
Speaker Change: Thinking about reimbursement, which is I know something you're working on with John <unk> can you just comment about.
Speaker Change: Your thoughts around.
Speaker Change: Public payer coverage as it relates to Medicare Medicaid and understanding that presumably the administration's know that thats a important thing in the nano and the opioid crisis as well as the commercial side, where you would think that.
Speaker Change: Bad headline coverage of not paying for that is probably not a good thing and so given those two things are you fairly confident that reimbursement is something that should not be an issue on the launch of Undrawn index. Thank you.
Speaker Change: Yeah, well, Hey, Mike Let me first address your first comment I've never been more excited to be at vertex I have never been more confident about the future of this company.
Speaker Change: It is firing on all cylinders, both scientifically and commercially and so I wouldn't want you to have any doubts about my confidence in either the launch of generics or the launch of any other things that we have ongoing right now.
Speaker Change: It is a purely personal decision that the time is right for me to move on to the next chapter of my life.
Speaker Change: In terms of payer coverage I am expecting us to get broad coverage for genetics overtime across all segments for the reasons that you described Mike to be perfectly honest with you.
Speaker Change: Everybody is aware of the enormous unmet need everybody has been waiting for a truly effective non opioid pain reliever that did not have the adverse events, including addictive potential.
Speaker Change: Of opioids, and so I'm expecting us to get.
Speaker Change: Broad access over time in addition to the individual discussions we've been having I think we've talked a number of times about the many both federal and state policy needs, which are already in flight to create if I can put it this way is it a tailwind.
Speaker Change: To the to the availability of generics so I'm incredibly excited about obviously only seven days seven business days into the launch.
Speaker Change: The feedback has been absolutely tremendous and I am sure of dynamics is going to be a huge success.
Speaker Change: Perfect. Thank you.
Speaker Change: Okay.
Speaker Change: The next question will come from William Pickering with Bernstein. Please go ahead.
William Pickering: Alright. Thanks, so much for taking my question Congrats on all the progress and Stewart Congrats on your retirement.
William Pickering: I had a question about the D P N phase III.
William Pickering: What placebo effect did you assume in designing that study and how does that compare to the the two points placebo effect. We saw in L. A S. R is one and a half points placebo effect, a reasonable ballpark and what delta versus placebo would be clinically meaningful first etcetera gene. Thank you.
William Pickering: Yeah.
Well first I did read your note from earlier in the weekend I. Appreciate that you were doing a primary research while going through your own surgical procedure.
William Pickering: D P N phase III I won't share the specifics with you will but what I will tell you is that in the D. P. M area. There are many phase two studies and many phase three studies and there are several medicines that have been approved and we have taken full advantage of that.
William Pickering: Rich dataset to appropriately five our phase III trial, and you will note that the phase III trial has not only a placebo group, but also has a.
William Pickering: Gabapentin a group in addition to the generics group and we've taken all that into account as we think about.
William Pickering: The outcomes there so while I won't share with you. The specifics. Please note that we have taken full advantage of all that's available out there the general range that you have.
William Pickering: Suggested or indeed, what the literature tells you and the study that we've designed including the sample size well takes care of that.
William Pickering: That level of a placebo effect.
William Pickering: Thank you.
William Pickering: Yeah, you bet.
Speaker Change: The next question will come from lethal Banco with Evercore ISI. Please go ahead.
Speaker Change: Hi, Thanks for taking my questions then I'll just get in line and offer my congratulations to Paul.
Speaker Change: To tap everybody involved actually.
Speaker Change: Great.
Speaker Change: Have fun.
Speaker Change: Won't be living vicariously through so I wanted to ask about the pain program.
Speaker Change: Couple of questions can you maybe describe.
Speaker Change: Sort of any like stocking it seems like you are trying to get.
Speaker Change: Product available and the different channels. So just wanted some.
Speaker Change: The commentary there and also how are you thinking about.
Speaker Change: Who is the right patient we did obtain call earlier this week and a big topic was onset of action.
Speaker Change: And and kind of like where it falls in line and in the ambulatory care setting.
Speaker Change: Onset of action, there's a little bit longer.
Speaker Change: So where are you thinking of how it is positioned in terms of per second or third line and and what is the right person for that.
Speaker Change: Or.
Patrick: Uh Huh Patrick Thank you.
Speaker Change: Chris I'm going to turn it over to Stuart to give you some color, but I just wanted to say upfront. Our goal here is for <unk> to be the first line prescribed pain medicine for moderate to.
Stuart Arbuckle: To severe acute pain Stuart yes, so Lisa just to address your first question on on stocking, Yes, we are looking to get the product broadly stocked in retail.
Stuart Arbuckle: Across the country. In addition to you in a in hospitals and hospital pharmacies as well so yes, we are.
Stuart Arbuckle: Striving to do that and I feel very comfortable that we will.
Stuart Arbuckle: As I said, all our product will be with the wholesalers by the end of this month and then in the channel shortly thereafter.
Stuart Arbuckle: Like I said you know the great thing about genetics is we got a broad label for the treatment of moderate to severe acute pain.
Stuart Arbuckle: And we've heard people from across the spectrum of different physicians talking about how they think they're going to be using it in many many different populations I do think some of the early walnuts might be procedures, where after a procedure.
Stuart Arbuckle: Body feels like they often need to prescribe a product for a week or two weeks afterwards and in those situations, that's where they are most concerned about prescribing opioids in the discharge setting there. So I think that will certainly be an area, where there will be patients treated relatively early on but as regimen said.
Stuart Arbuckle: Our goal and I think how people are seeing genetics is that it is for the treatment of moderate to severe acute pain regardless of.
Stuart Arbuckle: Although etiology and so I expect it's going to be used broadly across the spectrum.
Charlie Wagner: And he said we have just one more comment from Charlie.
Speaker Change: What I would add to Stuart's comment, we'll absolutely see stocking in the first half of the year, which is why we commented that youll see volumes increasing ahead of revenues. The reason for that is the impact of our patient assistance programs, while we work to secure broad access and so while there will be stocking in the channel in the first half of the or the revenue.
Charlie Wagner: <unk> will really be more loaded to the second half of the year.
Speaker Change: Okay. Thank you.
The next question will come from film to do with the TD Cowen. Please go ahead.
Speaker Change: Good afternoon, and thanks for taking our question.
Speaker Change: Sure Charlie and ducking, Matt is that our congratulations on today's announcements and your transitions.
Speaker Change: In terms of our questions.
Speaker Change: On Germany.
Speaker Change: One on electric on trying to mix can you give us some sense of where the prescription data that we see from third party sources be accurate.
Speaker Change: And water.
Speaker Change: Texas on expectations for the average duration of a script.
Lift truck, there's a dispute going on between you and royalty pharma as to exactly what what royalties owed can you give us some sense of the milestones in that dispute when when could we hear something and what are their procedures to getting that resolved.
Speaker Change: So let me take your second question first and then I'll turn it over to Stuart you talk about genetics.
Speaker Change: Left track.
Speaker Change: This is really not a matter of opinion.
Speaker Change: We have a contractual agreement with the CF Foundation and the contract very clearly spells out what our responsibilities are and so I don't.
Speaker Change: I don't see any.
Speaker Change: Room for interpretation or opinion on that Stuart on.
Speaker Change: Genetics, a few questions in that yet generics on length of therapy Phil.
Speaker Change: So the first thing I'd say is that the label is for moderate to severe acute pain. It does not have a a time limitation or a days of therapy limitation contained within the label, although acute pain is considered to be paying laskin for less than 90 days.
In terms of in the obviously in the inpatient setting it's very short length of the length of therapy, there in the discharge or outpatient setting.
Speaker Change: For nonsteroidal olds.
Speaker Change: You see lengths of therapy at around about 14 days for opioids, it's markedly less somewhere in the seven to eight day range.
Speaker Change: For all the reasons that we probably expect I would expect generics he is going to be more like.
Speaker Change: The non steroidal because it doesn't have the sort of the baggage that the opioids have which is what leads people to want to give out as little days of therapy as they possibly can.
Speaker Change: And so there was a quick question in there about will the prescription data be accurate, maybe you split them out into the retail end, but what happens in the in patient yeah. So.
Speaker Change: It depends a little bit on what prescription data you by Phil says a little bit hard to comment on exactly what are how good it will be but prescription data overall in the retail setting is very.
Speaker Change: It's very robust in the hospital setting it's more volume related data that's available we will be providing as Charlie said in his prepared remarks.
Speaker Change: Information on prescriptions as a mark one of the markers of all.
Speaker Change: Success in our in ongoing coals.
Speaker Change: For 2025, we'll also be providing updates on the number of covered lives as well as two of the most important markers of our early launch success.
Speaker Change: That's very helpful. Thank you.
Speaker Change: Yes.
Speaker Change: The next question will come from Ellie Merle with UBS. Please go ahead.
Ellie Merle: Hey, guys. Thanks for taking my question and you mentioned with electric you've seen starts from all the different patient segments can you give any color on the new starts are coming from the patients who had previously been on let's see FTR modulator, but no longer were and what their rationale had been four deaths continuing others, the FTR modulators, but coming back to.
Speaker Change: That's correct.
Speaker Change: And basically you know taking a step back I guess, what drives your confidence that you can recapture.
Speaker Change: This segment of 6000 patients globally. Thanks.
Speaker Change: Yeah. So I mean, the first thing that drives our confidence.
That we have a good shot at getting those patients back into the clinical profile all electric itself obviously.
Speaker Change: It has a terrific efficacy and it's a once a day as well so it really is the profile and the fact that we know that all CF patients want to be on the best CFT. Our modulators. They certainly want to be on a <unk> modulator. If they can in these patients. Unfortunately have not been able to stay honest the FTL modulator for.
Speaker Change: A whole range of reasons.
So that's what gives us the confidence that a lot of those people are going to come back in and be initiated on electric.
Speaker Change: I can give you any granularity on the patients to date, it's a relatively small number of patients in the Grand scheme of things and I don't have the granularity to know exactly what those individual patients with thinking when they came back onto a onto electrical or even why they discontinued at this stage.
Speaker Change: Uh huh.
Ahmad: The next question will come from <unk> Ahmad with Bank of America. Please go ahead.
Ahmad: Hi, Thanks for taking my questions.
Ahmad: One on C F.
Ahmad: This year just to clarify are you expecting to see cannibalization.
Ahmad: Sure I would have thought from a laugh track and if so how should we be thinking about that rate of switching and then premier pipeline I just wanted to get a sense of expectations for the type one diabetes data that you set this show and you.
Ahmad: You know, how we should be thinking about the opportunity there.
Stuart Arbuckle: Alright, let me turn it over to Stuart Yes, so on a lift truck, yes, we are expecting patients to transition from dry CAFTA and even patients who maybe on one of our older see FTR modulators to electric given the benefit risk profile it as and the benefit it has of being once a day we haven't.
Ahmad: Set a.
Ahmad: Expectations or given any guidance on what we think that the rates of switching will be on.
Ahmad: On the <unk> question.
Ahmad: The best way to summarize it is that the lead program is the VX 880 program, let's call. It the naked cell program. That's now in the phase three portion of the development. That's the trial that we talked about is going to have its enrollment complete this year and we'll be in a position to.
Ahmad: File when that group of patients has one year of follow up being insulin freight we're estimating that that opportunity maybe something like 60000 people or so and the reason we say that is because it's maybe 45000 people or so who are brittle diabetic vary.
Ahmad: High fives in terms of their sugars and load those and maybe 15000, something like that patients who have already been transplanted with a kidney transplant because of their type one diabetes and are therefore already on immunosuppressive.
Ahmad: And then the next program, which is in phase one two that's the same cell encapsulates with the device no immunosuppression required there and of course with that program. We aim to get to all of the type one diabetic patients and then we have programs in research that aim to make the.
Same VX 80, 880, self hypo renewed with certain gene edits and we're also working on alternative immuno suppression all of those latter programs our goal would be to get them to all patients.
Ahmad: So it will take two more questions. Please.
Speaker Change: Yes, ma'am. The next question will come from Dave or finger with Leerink partners. Please go ahead.
Speaker Change: Yes, thanks, very much so I wanted to add my congrats to steward, Charlie and Duncan as well.
Speaker Change: I have two questions. So first.
Speaker Change: With respect to the plans.
Speaker Change: Secure broad formulary access them.
Speaker Change: I'm, hoping that you can discuss that in a little bit more details so.
Speaker Change: If a drug is on formulary, but theyre hassles for the physicians. It just won't be prescribed at all surgeons don't have time to go through step edits and other challenges Stowe do you expect to be able to pay the rebates that are necessary to get broad unfettered access.
Speaker Change: Yes.
Speaker Change: Too soon as after gene and then second with respect to the country that is violating.
Speaker Change: Vertex is IP what are the company's plans to take action to prevent other countries from doing the same as that single country. Thank you.
David: Hey, David Let me ask.
Stuart Arbuckle: Stuart to go first and then Charlie will comment, yes, so youre right getting broad access if you have significant utilization management controls.
Speaker Change: It is really not getting broad access if you're putting lots of hurdles in the way of our prescribers to actually usual medicine, 100% agree with you and so our goal is not just.
Speaker Change: Broad access, but it's broad access in both commercial and government channels, but with minimal utilization management controls and that's certainly been the nature of the discussions that we've been having with them preapproval and since the since the approval because I absolutely agree with you brought access on its own.
Speaker Change: Is insufficient and so that is a key part of what we are talking to payers as I say in both the government.
Speaker Change: And in the commercial area and it's actually what you see in some of the policy initiatives that have been introduced as well say for instance, the alternatives to paint Act, which was actually reintroduced to Congress just last week.
Speaker Change: One of the things that it includes is there and for Medicare part D. Patients is two things one no utilization management controls and also.
Speaker Change: No.
Speaker Change: Equal co pays for a branded non opioid with generic opioids to the point that you are you all making Charlie a quick word you know, Dave we have an incredibly strong and robust IP portfolio around CF and you know that it goes out to the late twenties thirties.
Speaker Change: Been very successful in defending and enforcing our IP in every market. The one country. In question is Russia, where they have made a decision to disregard the IP and allowing unauthorized copy we're taking every measure possible to enforce our rights, but that is a sort of let's say a unique moa.
Speaker Change: For that reason I feel that this issue is very isolated.
Speaker Change: Thank you.
Speaker Change: The next question will come from Olivia Brayer with Cantor Fitzgerald. Please go ahead.
Olivia Brayer: Hey, good afternoon, guys. Thank you for the question do you know yet whether there will be quantity limits or any other utilization management parameters put in place for for journey Vacs, maybe just any feedback you're getting so far from those payer conversations and do you have a sense yet around how long it'll take before P&C committees actually officially recommend.
Olivia Brayer: Formulary coverage or maybe just asked another way what would you consider to be in an expedited and expedited process.
Olivia Brayer: Yeah.
Speaker Change: Yeah, Olivia I'll kind of repeat a little bit of what I said in my answer to Dave just a second ago. We certainly are very aware of the fact that utilization management controls can get them away.
Speaker Change: Physicians wanting to prescribe and patients get at getting access to a new medicine, and certainly our discussions with payers as I said on the government and on the commercial side.
Speaker Change: Involved discussions about minimizing those utilization management controls and certainly not considering things like step edits through generic opioids, which I think we'd be medically and ethically.
Speaker Change: Inappropriate so that is a discussion that we've been having a prior to launch and we are continuing to have.
Speaker Change: In terms of the PMT formulary committees, particularly in the institutional setting again, one of the things that we were doing in the run up to the approval in a compliant way was.
Speaker Change: Sure we understood those processes, we will providing the institutions with everything that we could compliant leaf prior to the approval to allow them to think about how quickly they wanted to review.
Speaker Change: <unk> genetics when it was approved we've obviously re engaged with those institutions post approval I do believe a number of them will accelerate their processes faster than they they typically do they can certainly take up to 12 to 18 months in some cases.
Speaker Change: Some new products and we are looking to significantly accelerate that everywhere that we can.
Speaker Change: Okay.
Speaker Change: But I don't think that if he could represent please.
Speaker Change: Yes, Ma'am this will conclude our question and answer session as well as our conference call for today. Thank you for attending today's presentation. A replay of today's event will be available. Shortly after the call concludes by dialing 187734475 to nine or 1412.
Speaker Change: 31, 70088, using replay access code 10187033. Thank you for your participation today you may now disconnect.
Speaker Change: [music].