Q4 2024 BeiGene Ltd Earnings Call
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Speaker Change: Good day, everyone. Welcome to Beijing's Q4 and full year 2024 earnings call webcast.
Speaker Change: All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. At this time, I would like to turn the call over to the company.
Speaker Change: Good morning and welcome. Thanks for joining us today. I'm Dan Maller, Head of Investor Relations at Beijing.
Speaker Change: I would like to remind all participants that during this call we may make forward-looking statements regarding, among other things, the company's future prospects and business strategy. Actual results may differ materially from those indicated in the forward-looking statements as a result of various factors.
Speaker Change: including those risks discussed in our most recent periodic report filed with the SEC.
Speaker Change: Please also carefully review the forward-looking statements disclaimer in the slide deck that accompanies this presentation.
Speaker Change: Reconciliations between GAAP and non-GAAP financial measures discussed on this call are provided in the appendix to our presentation, which is posted to our Investor Relations website along with our earnings release.
Speaker Change: All information in this presentation is as of the date of this presentation, and we undertake no duty to update such information unless required by law.
Speaker Change: Now, turning to today's call, as outlined on slide 3, John Euler, our co-founder, chairman, and CEO, will provide opening remarks and an update on our hematology franchise.
Speaker Change: Matt Shawlis, our General Manager of North America, will provide an update on the U.S. commercial performance of Burkinza. Lai Wong, our Global Head of R&D, will discuss our R&D and pipeline progress, and Aaron Rosenberg, our CFO, will review the fourth quarter financial results and our 2025 financial guidance.
We will then open the call to questions.
I'll now pass the call over to John.
Thank you, Dan, and good morning, everyone.
John Euler: 2024 was a truly remarkable year in which we achieved $3.8 billion in revenue for the full year, $1.1 billion in Q4.
John Euler: positive quarterly cash flow from operations, BTKI leadership in new patient starts across all lines and all indications in the U.S., and Brukenza U.S. revenue exceeded CalPINs for the first time in the fourth quarter.
John Euler: We introduced 13 new molecular entities into the clinic and we matured as a global company with the completion of our 800 million U.S. flagship manufacturing facility, our ticker change to ONC, O-N-C, and our proposed name change to B1, and re-domiciliation to Switzerland.
John Euler: We believe that we've reached an inflection point and we're truly excited for the future.
John Euler: Our company was purpose-built to address the long-lived challenges of return on investment in our industry. And as you know, it's not getting any easier to generate ROI on each R&D dollar.
John Euler: Clinical trials represent more than 75% of the total cost to develop and commercialize an oncology medicine and they're now estimated to be 250 to 300 K per patient.
Still rising.
It's increasingly challenging out there.
John Euler: But, we built Beijing from inception for a world that envisioned these challenges.
John Euler: Our truly global CRO-free clinical team of nearly 3,700 allows us to move at a greater speed and a lower cost than our industry peers.
John Euler: Paired with our internal research and internal manufacturing, we've enabled a fast, proof-of-concept approach that shaves meaningful time from early stage development.
John Euler: We're innovating with intentionality, and we're building best-in-class franchises with better outcomes for patients that will provide superior returns in the increasingly competitive commercial landscape.
John Euler: In CLL, we believe we're in the middle of a once-in-a-lifetime opportunity which is akin to that of Gilead in HIV and Virtex in cystic fibrosis.
John Euler: Our focus for 2025 is to deliver upon three strategic pillars.
John Euler: First, solidify and deepen our hematology franchise leadership. Second, advance our pipeline of internally developed assets. And third, drive superior financial performance.
My section today will focus on our HEIM franchise.
John Euler: And of course, we can't talk about the franchise and our heme leadership without starting with Brukenza.
John Euler: Brukenza was designed from inception to provide 24-7 inhibition of PTK in all disease compartments and to address efficacy and tox challenges of Ibrutinib.
John Euler: As you can see here, only Brukenza maintains serum exposures well above its IC50, whereas Ibrutinib and Acala exposures are well below their IC50 for the majority of the period.
John Euler: and you can't fight cancer part-time or only in the blood. A recent peer-reviewed publication analyzed the differences in BTK occupancy between the three approved covalent BTK inhibitors.
These results indicate to us
John Euler: that with regard to target engagement only ZANU provides complete and sustained inhibition of BTK across all relevant disease compartments and that ZANU is greater than Ibrutinib, which is greater than Acala.
John Euler: These data and the clinical results shown here proved our hypothesis was correct. In the Alpine trial, Brukenza demonstrated sustained superior PFS efficacy in lower cardiac tox head-to-head against Ibrutinib.
John Euler: On the left, the alpine data in the high-risk deletion 17p p53 subpopulation is shown.
John Euler: At 42 months, milestone PFS was 59% for Xanu and only 32% for agglutinib.
John Euler: On the right is the ELEVATE-RR study, also in the high-risk deletion 17P, P53 patients, which is said to have a hazard ratio of 1.
John Euler: But please note the early separation is likely due to lack of tolerance to a brutinib.
John Euler: But more importantly, that Acala crosses at just over 30 months and actually becomes 8% worse than Ibrutinib at 42 months.
John Euler: And at this time period, the milestone PFS is only 28%.
Yes, I said 28%.
John Euler: And this compelling data has led to exponential growth in BRUKENZA global sales, less than two years from our first approval in CLL, and despite being the third to market, BRUKENZA has become the VTKI class leader for new patient starts.
John Euler: Perhaps the combination of the aforementioned data and real-world experience are leading to both patients and clinicians understanding that on efficacy, C is greater than I, which is greater than A.
John Euler: I'd like to take a few moments to talk about the fixed-duration treatment landscape and why we view it as a key opportunity to grow our CLL leadership.
John Euler: To create compelling fixturation therapy, three key attributes are required. First, deep response.
John Euler: Second, compressive and sustained PFS compared to continuous therapy, and third, safety during the treatment period that adds only minimal liability over a continuous Brukenza, which has consistently demonstrated a favorable safety profile.
John Euler: Recent data presented by competitive treatment options certainly leave a lot to be desired.
First.
Amplify did not show a deep MRD response.
Actually, only 34% of AV patients reached MRD negativity.
which was both statistically inferior to chemo.
John Euler: and also dramatically worse than precedent data from similar phase three trials of VO and VI.
John Euler: By comparison, our combination of Brukenza plus Sonreau has shown 91% MRD in a much less healthy all-comers population.
John Euler: Secondly, current fixed duration options do not show a sustained PFS benefit that matches continuous use Brukenza, particularly with longer follow-up.
Amplify enrolled a highly selected, young, and fit population.
The population represents less than 25% of real-world CLL patients.
John Euler: So how did AV compare to the precedent? Similarly fit DO data?
It's simply much worse.
John Euler: How did A compare to I when they each combined with V?
John Euler: The A combination was worse in both MRD and in PFS.
despite being in a fit population versus VI's unfit populations.
John Euler: Numerically, in combination, I was greater than A, which is consistent with all the previous data.
John Euler: And this is even more striking as one expects fit to do better than unfit.
How much better might one expect?
For VO, the data is right here.
John Euler: Recognizing the limitations of cross-trial analyses, there appears to be a 6% to 7% improvement in PFS benefit when comparing fit versus fit, unfit.
Thank you.
John Euler: The underwhelming efficacy of Amplify becomes even more evident when reviewing the actual PFS curves at the early 36-month period.
John Euler: No Brukinza in an unfit population at 84% and A plus V in fit patients at only 76.5.
Also notice AV shows further deterioration around that time point.
John Euler: And finally, current fixed duration options have a challenging safety profile during the first 60-week treatment period compared to Brukenza, and that's comparing again, unfit, to a highly selected, healthy population.
John Euler: As you can see, there's a substantial additional tox burden placed on these elderly patients during the first 60 weeks, all for an inferior 36-month PFS.
John Euler: It raises the question for AV, is the juice worth the squeeze?
John Euler: We strongly believe in the promise of fixed duration, but unfortunately the current options don't fulfill this promise.
John Euler: This provides a significant opportunity for a best-in-class combination of SONRO and ZANU that checks all the boxes.
John Euler: deep MRD responses, impressive and sustained PFS curves at 19 months, and acceptable safety. This combination has the potential to render the competitive molecules as not credible substitutes.
John Euler: Our Phase 3 Pivotal Celestial CLL trial has completed enrollment against V plus O, not against chemo, and V plus O is actually a relevant and widely used standard of care.
John Euler: We also have an ongoing phase 2 studies with early registrational potential in CLL, Waldenstrom, and MCL, and we're planning to initiate two additional phase 3 trials in CLL and MCL in the first half of this year.
John Euler: Another big HIEM opportunity is our BTK CDAC. This program has enrolled more than 500 patients and is by far the most advanced BTK degrader. We presented compelling early efficacy and safety data in a heavily pretreated population at ASH.
John Euler: As you can see here on the slide, the evolution of our data relative to PERTO together with KOL feedback gave us confidence to initiate a head-to-head phase 3 trial against PERTO in the second line later this year.
John Euler: We also have an ongoing Phase 2 expansion trial in relapsed refractory CLL that's potentially registration enabling and have an aggressive development plans for earlier lines of therapy, including combinations. We are really excited about this program.
John Euler: In summary, our HEIM franchise is poised to win, as we are the only company with the wholly owned potential best-in-class molecules across the most important targets and modalities.
John Euler: We believe that we can dramatically improve the standard of care across all lines in CLL.
John Euler: We have a once-in-a-lifetime opportunity to build life-changing combinations and the preeminent franchise in the $12 billion-plus CLL market, and we believe our franchise model will help insulate us from pricing pressures.
And with that, I'll pass it over to Matt.
Thanks, John.
Moving to McKinsey's U.S. performance.
John Euler: Rikinza's commercial adoption has been remarkable and consistent with what you would expect to see with a clearly differentiated and best-in-class medicine.
John Euler: Within the BTK market, we continue to strengthen Rukinza's position as the BTK of choice, as demonstrated by its leadership in both front-line and relapsed refractory CLL new patient starts.
John Euler: Overall CLL new patient share has grown to over 50% and our strength and leadership extends beyond CLL. Our new patient share is even higher across our other approved indications.
New patient share is a leading indicator of value share.
John Euler: And we see the leadership in CLL and our other approved indications playing out on this slide.
In Q4, we had 616 million of U.S. sales.
representing 97% growth compared to the prior year.
John Euler: This solid performance capped off a strong 2024, where we had $1.95 billion of revenue, representing growth of 106% versus 2023.
John Euler: We surpassed CalQuint and U.S. Revenue in Q4 and we are close to overtaking Imbruvica, remarkably less than two years from Merkins' CLL approval.
John Euler: This is testament to Perkins' differentiated profile and our strong clinical development, medical and commercial execution.
John Euler: The CLL landscape remains competitive, but we are in an excellent position as we enter 2025.
John Euler: The overall global desalination market opportunity in our approved indications is large and broad.
totaling approximately $21 billion in 2024.
John Euler: The U.S. represents a significant portion of the global market and CLL is over 50% of the market in the U.S. and similarly growing robustly.
In terms of patient volumes...
The BTK class represents about 50% of U.S. CLL patients.
John Euler: And as we've mentioned, Perkins is the BTK leader in new patient starts and CLL.
John Euler: Given its differentiated profile, we believe McKenzie can further expand its lead in the BTK class.
John Euler: As you think about Rekenza as a continuous treatment, it's important to consider the stacking effect of patients that remain on therapy.
John Euler: In 2024, about one-third of Brookings' U.S. revenue came from new patients, and two-thirds came from patients that were already on therapy as we started 2024.
John Euler: which means we have several years of revenue growth from our increasing new patient share levels.
John Euler: As you can see in the chart, the remainder of patient volume beyond BTK is split between fixed-duration regimens, BCL2 venetoclax, and chemo.
John Euler: Currently approved Venn-based fixed duration regimens are not for all patients, and over half of newly diagnosed patients have one or more high-risk features.
where Venn-based regimen treatment is associated with shorter PFS.
John Euler: Amplify, despite enrolling a fit, non-representative patient population that excluded patients with these risk factors, nonetheless confirmed these shorter PFS endpoints.
John Euler: Demonstrate low MRD rates that do not correlate durable emission and brought along safety challenges.
John Euler: Given the challenges with current fixed-duration regimens and Burkina's best-in-class profile, we see additional opportunity for Burkina monotherapy to continue to take share from these treatment options.
and beyond expansion of BTK model therapy.
John Euler: We believe we have the opportunity for a franchise leadership strategy with SOMRO and our BTK degrader that has the potential to far surpass the other existing treatment options and fulfill the needs of all patients with CLL, regardless of risk profile.
On that note, now over to you, Lye.
Lye: Thanks, Matt. I would like to take a few minutes to highlight the rest of our portfolio.
Lye: By 2022, Beijing's growth was primarily driven by Zainab Rutanat and Tissa Lissner. Over the past three years, the portfolio has undergone significant transformation. For hematology, we now have three cornerstone assets, each with multi-billion dollar market potential.
Lye: The solar tumor portfolio has transitioned from a broad immuno-oncology and pan-tumor strategy to a disease-focused approach.
Lye: The pipeline targets lung, breast, and gastrointestinal cancers, focusing on critical signaling pathways and the TA-driven therapies supported by various technology platforms.
Lye: Our R&D productivity has been remarkable and sets us apart from others in the industry. In 2024 alone, we put 13 pneumonic entities into the clinic, which is more than any of our peers, above even the largest pharma companies in the industry.
Lye: And these assets are some of the most exciting ones in all of oncology.
Lye: In addition to strengthening our drug discovery capability, we have assembled an internal global clinical development team with CIAs in 37 countries.
optimizing clinical process for superior execution.
Our fast POC strategy consistently surpasses industry benchmarks.
Lye: For instance, our CDK4 inhibitor trials achieved an average of just 6.4 weeks per dose level and enrolled over 180 patients within 14 months, a remarkable feat mirrored across all early programs.
Lye: In addition, we're enhancing late-stage trial efficiency as well. Recently, we completed phase 3 enrollment of the Celestial TN-CLL study, recruiting nearly 700 patients across 20 countries and 200-plus sites in just 14 months.
Lye: It is worth noting that over 75% of our patients in these two studies were enrolled from the United States, Europe, Latin America, Australia, and Japan.
Lye: Our speed and cost advantage have allowed us to advance one of the most promising pipelines in the industry.
Lye: This slide highlights some of our scientifically exciting programs, many of which we believe have the best-in-class or first-in-class potential in significant markets.
Lye: I will take you through each of these assets in a little bit more detail in the following slides.
Lye: Despite the success of CDK4-6 inhibitor, the dose-limiting toxicities highlight a mathematical need. A CDK4-specific inhibitor can avoid CDK6-related toxicities.
Lye: BGB43395 has the potential to be the best-in-class CDK4 encryptor due to its superior selectivity and potency compared to FIDO's thermocycler.
Lye: We're observing lower hematological toxicities aligned with better selectivity, and it might be a dose higher to achieve better tongue inhibition.
Lye: As shown in the graph, BGB43395 achieved 80% TK1 incubation at dose level 8.
Lye: similar to a thermostat clip at the RP2D. And at those level B, 43305 further improved the TK1 incubation to 95%.
Lye: The proof-of-concept data is expected in the first half of this year.
Lye: KVAS mutations are found in almost 1 out of 5 cancer patients.
Speaker Change: Unlike pan-RAS inhibitors, such as RMC6236 from Revolution Medicine, pan-K-RAS inhibitors spell H-RAS and R-RAS, possibly offering a better therapeutic window by not inhibiting the RAS pathway in normal tissues.
This molecule began clinical trials in November 2024.
Speaker Change: B7H4 is expressed in several solid tumors, including breast, ovarian, and endometrial cancers. Over 70 patients have enrolled across seven dose levels showing responses in various tumor types and at multiple dose levels.
We believe we have a first-in-class opportunity here.
Speaker Change: EGFR-CDAC, a first-in-class degrader with broader EGFR mutation coverage and a sparing Y-type EGFR, showed a strong efficacy in both osimertinib-sensitive and resistant preclinical models.
Speaker Change: It entered the clinical trial in December 2024. The development pathway is quite straightforward, intense as an add-on to the third generation EGFR-TTI4 frontline, adjuvant, and a locally advanced non-small cell lung cancer.
Speaker Change: MTAP deletions occurs in one of seven cancer patients. Both PMP5 and the MET2A inhibitors cause cell deaths in MTAP-deleted tumors, and they show strong synergy in perkinone models.
Speaker Change: Beijing is the only company with clinical-stage assays for both. Our PMD-1 inhibitors stand out for its potency, selectivity, and brain penetration. And our Maturin inhibitor also penetrates the brain and demonstrates superior potency in preclinical models.
Speaker Change: We will begin the combination study of these two molecules in the second half of 2025.
Speaker Change: IRAC4 is essential for TLR and the interleukin-1 receptor pathway. Sanofi cameras KT474 show the near-complete IRAC4 degradation in blood, but only 50-70% in skin.
Speaker Change: We developed BGB45035 to fully degrade IRAC4 in target tissues and avoid KT474's cardiovascular risks.
Speaker Change: At 5.1 QD, 45035 achieved a complete IRAC-IV degradation in blood. Phase II starts in late 2025 with tissue degradation data expected this year.
Speaker Change: And finally, I wanted to highlight a few of our key pipeline value inflection points.
Speaker Change: Our late-stage hematology assays have several significant milestones in 2025, including Phase II trial readouts that may support accelerated approval submissions.
Speaker Change: as well as the initiation of phase 3 pivotal trials for both SOMRO and our VTK degrader, including the planned head-to-head trial versus PROTO.
Speaker Change: Turning to our early-stage pipeline, as you have heard, we have a number of concept catalysts expected for our early-stage pipeline across multiple modalities and therapeutic areas.
Speaker Change: We look forward to sharing more data in future updates. With that, I'd like to pass it over to Aaron to review the financials.
Thanks, Lye.
Speaker Change: 2024 was a pivotal year of growth and an affirmation of our path to sustainability. We generated strong top-line revenue growth with total sales of $3.8 billion for the year as compared to $2.5 billion in 2023.
Speaker Change: As revenue grew by 55% as compared to last year, with product revenues increasing by 73%, growth was seen across all key products and markets, which puts us in a position of strength as we enter 2025.
Speaker Change: Focusing on our fourth quarter results, total revenue for the quarter was $1.1 billion with Q4 2024 product revenue growth of 77% compared to Q4 of last year.
Speaker Change: And consistent with recent trends, we see a broadening of our revenue base. The United States represented 55% of total revenues in the quarter, with Europe contributing another 10%.
Speaker Change: Sales of Brickenza totaled $828 million in Q4, representing 100% growth as compared to Q4 2023.
Speaker Change: In the United States, Brukenza growth was driven by demand given our expanding leadership in new patient-shared CLL as well as other approved B-cell malignancies where Brukenza continues to have the broadest label in the BTK inhibitor class.
Speaker Change: Please note that this class does experience seasonality in the U.S., with Q4 and Q2 being quarters of seasonally high sales. In addition, the United States 2024 Q4 sales were also positively impacted by the timing of customer orders of approximately 30 million.
Speaker Change: In Europe, Burkina continued its growth trajectory in Q4, culminating a full year where the business nearly tripled. We continue to grow share in Europe where we are earlier in the product launch cycle as compared to the United States.
Speaker Change: Rukinza remains the leading BTKI in China. As we've highlighted before, we are in the early stages of launch in key rest-of-world markets with large opportunities, such as Brazil and Japan. We look forward to continuing to execute our plans to bring Rukinza to patients in these markets.
Speaker Change: Zimbibra revenue of $154 million resulted in 20% growth as compared to Q4 of 2023. We remain the market leader in China with the broadest NRDL label coverage in the class.
Speaker Change: Commercialization efforts for TIFF Imbra are ongoing in other markets, including the U.S. and Europe, following recent regulatory approvals. We are launching in these markets in a targeted fashion and look forward to sharing updates over the course of 2025.
Speaker Change: Amgen in-license products were also strong key contributors to performance with 101 million of revenue in Q4, representing growth of 98% as compared to Q4 of 2023.
Speaker Change: Walking through our operating P&L and my comments will be on a gap basis.
Speaker Change: Product growth margin was 85.6% for Q4, an increase of 2.4 percentage points versus last year, largely due to favorable mix and cost of sales productivity for Rukinza and Tibibra.
Speaker Change: Operating expenses totaled $1 billion and included $60 million in research and development expense associated with the in-license of our MAT2A inhibitor announced in December.
Speaker Change: The growth in OPEX supported capability built to deliver near and long-term revenue growth and to rapidly advance our robust and differentiated innovative pipeline.
Speaker Change: Our strong revenue growth and value focused investment philosophy has resulted in significant operating leverage, with product revenue growing more than five times faster than expenses in the fourth quarter.
Speaker Change: This resulted in meaningful improvement in GAAP and non-GAAP operating results for Q4-24 compared to Q4 of the prior year, and the achievement of full-year non-GAAP breakeven.
Speaker Change: Q4 delivered $79 million in adjusted income from operations, achieving our third consecutive quarter of non-GAAP operating income. And as mentioned, these results included the $60 million expense from the in-license of our MAT-QA inhibitor.
Speaker Change: And our focus on operating leverage has translated into a second consecutive quarter of positive operating cash flow generation, resulting in improved cash utilization on a full year basis. These are key metrics for the company as we transition to a self-sustaining enterprise.
Speaker Change: Now, turning to capital allocation, where we follow a disciplined investment philosophy to support our dual mandate of both growth and sustainability.
Speaker Change: At the center are conservative financial policies that serve as a balance to the inherent risk-taking associated with being a leading, high-growth, innovative biopharmaceutical company.
Speaker Change: Having a strong balance sheet in our industry is a competitive advantage, and we are committed to continuing to prioritize its strength. And we are in an excellent position as we close 2024, with $2.6 billion in cash while advancing towards sustained cash flow generation.
Speaker Change: We will continue to invest in our differentiated commercial assets and geographies to deliver profitable growth and bring our innovative medicines to more patients.
Speaker Change: At the same time, we will fuel our innovation engine with its unique and differentiated advantages in both time and cost, particularly through proof of concept.
Speaker Change: Value-creating business development plays an important role in our strategy by providing access to the best external science, particularly for assets that complement our internal portfolio. And consistent with previous collaborations, we will actively explore partnerships that strengthen our business.
Speaker Change: Now, turning to our 2025 guidance, which assumes late January exchange rates and no potential new business development activity.
Speaker Change: We expect another strong year of revenue growth given our leadership for BRICNSA. We anticipate that the U.S. will continue to gain new patient share and also benefit from year-over-year lapping of 2024 new patient starts.
Speaker Change: And we assume relatively stable net pricing for Perkins in the U.S. in 2025. This is supported by our specified small manufacturer designation, which layers in the increases in manufacturer liabilities for Medicare Part D benefit redesign over a five-year period.
Speaker Change: Growth is also anticipated from continued global expansion in both Europe and other important rest of world markets.
Speaker Change: We project revenue to be between $4.9 billion to $5.3 billion. At these levels, foreign exchange represents an approximate 1% headwind for the year. And as you consider quarterly phasing in your models, please note the seasonal patterns and customer order timing that I previously mentioned.
Speaker Change: Our GAAP gross margin percentage is assumed to be in the mid-80s percent range.
Speaker Change: and it is anticipated to continue to benefit from improved mix.
Speaker Change: production efficiencies as compared to full year 2024. This guidance contemplates the potential impact in our understanding of current form from new U.S. tariffs on imports.
Speaker Change: Incremental costs from these tariffs are anticipated to be modest for us, given our margin structure and the degree of manufacturing for Perkinsia that is conducted in the United States. This does not contemplate unannounced additional measures which may change this outlook.
Speaker Change: Operating expenses on a gap basis are forecast to be between $4.1 billion and $4.4 billion. Our investments support key growth in both commercial and research at a pace that continues to deliver meaningful operating leverage.
Speaker Change: This is demonstrated by significant reductions in expenses as a percentage of sales.
Speaker Change: Non-GAAP operating expenses are expected to track with our GAAP guidance, with reconciling items remaining unchanged from existing practice.
Speaker Change: And finally, we are affirming our prior commitments to achieve full-year gap operating breakeven in 2025 and generate positive cash flow from operations for the year. And with that, I will turn the call back to Dan.
Dan Maller: Thanks, Aaron. We are now ready for Q&A. I kindly ask participants to limit themselves to one question to ensure we have time to hear from as many attendees as possible. Operator, we are ready for the first question.
Speaker Change: If you would like to ask a question, please use the raise hand icon which can be found at the bottom of the webinar application. When you are called upon, please unmute your line and ask your question. We will now take a minute for the queue to assemble.
Speaker Change: Our first question comes from Kelly Shee at Jefferies. Please unmute your line and ask your question.
Speaker Change: Congrats on the impressive progress to the B1 team and thanks for taking our questions.
For 2025, it is guided, the four-year revenue guidance is
Speaker Change: $4.9 to $5.3 billion. Could you please walk us through the key assumptions for the initial guidance?
and what could be the key factors.
Speaker Change: that determine where the final number lands in the range of this guidance. And very quickly, I just want to confirm, now we have the B7H4 ADC and the CDK2 inhibitor moved up to
Speaker Change: first half of this year for data disclosure, just to confirm on that. Thank you very much.
Speaker Change: Thanks Kelly, this is Aaron. I'll answer the first part of your question and then hand it over to Lye.
Speaker Change: So, with respect to our 25 revenue guidance, we expect another strong year of revenue growth given our leadership for McKenzie. We're anticipating that in the U.S. we'll continue to gain share. And as I said in my prepared remarks, we also will benefit from the year-over-year lapping of 2024 new patient starts.
Speaker Change: This growth is against the backdrop, as I said, of a fairly stable net pricing environment in the U.S.
Speaker Change: And we do expect strong growth to continue from our global expansion. I mentioned in Europe in 2024 we nearly tripled.
Speaker Change: And we have other important rest of the world markets where we're really early. We're first launching in Japan in Q1 of this year as an example, and that's a meaningful market for Bukinsan.
Speaker Change: We're not providing quarterly guidance, although I did provide some commentary on the seasonality of the BTAKI class and with second quarter and fourth quarter being typically strongest. But overall we feel really confident about how we're entering the year following a really strong 2024. And with that, maybe I'll hand it over to Lye.
Speaker Change: Yeah, thanks Kelly for the question. We plan to provide the first data disclosure for both the BCH4ADC as well as the CDP2 at ASCODE. So this is for the first half of this year.
Thank you very much.
Speaker Change: Our next question comes from Sean Larman at Morgan Stanley & Co.
Please unmute your line and ask your question.
Speaker Change: Good morning, everyone. Sorry about that. Oh, good afternoon, everyone. Thanks for your presentation. I hope everyone's well.
Speaker Change: My question also relates to guidance. So you're surpassing Kalkwin Snow in terms of share. You're growing a lot faster than them, but they are still growing. The cadence of their growth seems to be plateauing a little bit over the last few quarters.
Speaker Change: I'm sort of wondering in the context of guidance what the feedback is that you get from clinicians on the viability of that drug longer term and maybe a bit longer dated, but any thoughts around what impact there might be from potential, any approval of the doublet with B?
Speaker Change: Yeah, sure, happy to address that question and yeah, we definitely see that You know when we look at our overall growth, we've been very robust
Speaker Change: comparing fourth quarter of 24 to fourth quarter of 23. And also, our full-year growth is very robust, comparing 24 to 23. To your question, you know, around the callot, we see that their growth rates are substantially less strong.
in that particular time frame.
John Euler: Then John, why don't you go ahead and make an additional comment?
John Euler: Yeah, in terms of the doublet, I think, look, we've shared a lot of data earlier in this call. You know, the things you need for a fixed duration treatment are things that don't look very impressive in that study.
Speaker Change: And it is a successful study in terms of beating in an ultra-fit population that represents maybe the, you know, healthier quarter of patients in the real-world scenario.
Speaker Change: and it's able to beat chemo on PFS at 36 months.
Speaker Change: That's what that study shows. The MRD negativity is statistically worse as we showed earlier in the slides and much lower than any precedent data that's ever existed before.
despite being in this ultra-fit, highly-selected population.
Speaker Change: The safety data is not what you'd hope to see, and then you look at the PFS data, you know, straight out.
Speaker Change: Again, it doesn't compare favorably to precedent data. It doesn't compare favorably to VI, and it certainly doesn't compare favorably to a continuous, you know, Brukenza therapy.
So I think from that perspective
Yeah, look, it's, you know...
Speaker Change: a study which has met a primary endpoint that is not that relevant.
Speaker Change: And I'm sure that they will market as much as they can about it and try to do their best to drive their commercial sales. They're a very powerful and successful marketing organization.
Speaker Change: But I think ultimately the data speaks for itself very clearly.
Speaker Change: And when people use that combination, their experience is highly likely to be in line with that data.
Speaker Change: So, I think this is, you know, more of the same as we looked at monotherapy, the story has been great around the calla.
Speaker Change: But as we look at monotherapy and as people actually are using the medicines and as the data matures and they use it more and more It's very clear to us You know on the efficacy story
Speaker Change: You know, we have a strong belief that we've laid out here that, you know, SAMU is a spectacular medicine that's proven in a head-to-head trial that it's more efficacious than I, so Z is greater than I.
Speaker Change: I has run a study against A, but in that study they failed to show superiority. They have a hazard ratio of one, and again their milestone PFS is 8% worse than the data that's previously shown.
So, with that said, we don't view this as...
I made your
Thank you.
John Euler: And John if I can just add a little bit of the color commentary around what we hear from physicians you know related to that that part of the question.
Speaker Change: Um, you know, and here I think we, we continue to hear about.
and handling concerns, you know, related to venetoclax.
and the complexity and the burdens of nature.
Speaker Change: of patient management on AV as well as on AVO, if you think about the triplet.
Speaker Change: And then, you know, when you look at the data that added ACALA to VO,
Um, you know, again, there, the outcomes don't suggest.
Speaker Change: an overall favorable profile when you start to look at safety. So, I think one of the things that we'll have to do, and we'll continue to hear from physicians, is look at what labeling ends up looking like for that doublet, and that'll be in the context of all those other factors.
Speaker Change: Great. Thank you. Comprehensive. I'll jump back in the queue. Appreciate it.
Speaker Change: Our next question comes from Andrew Behrens at Lyric Partners. Please unmute your line and ask your question.
Hi, thanks. Nice job on your first live earnings release.
Speaker Change: There's a big readout in gastric cancer for Zannie and Tizzle, and just wondering what you're looking for in RMC, what it could mean to the franchises, and also what's the company's commitment to breast cancer efforts that Jazz has embarked upon. And then based on John's squeeze-the-juice comments.
Speaker Change: I know you're not promoting fixed-duration Burkinsia yet, but are you seeing or expecting to see Burkinsia to be used off-label in fixed-duration regiments? Is there a chance to get a compendium endorsement ahead of the federal data?
Thanks.
Speaker Change: Yeah, thank you so much for the question. I will answer the first part of the question related to Zannie and then I'll pass to my colleague, Matt, to answer the second part of the question.
Matt Shawlis: In terms of ZANI, this is actually a three-arm design, as you pointed out. The third arm, which you mentioned, is the combination of the TISLA, plus ZANI, plus the T-MODE. We believe this will further broaden the label for our TISLA in the first-line gastric cancer. Right now, TISLA has a label in the HER2-negative patient population, and if this trial is successful, we'll further broaden the label.
Matt Shawlis: As you are aware of, this trial now, the readouts will be in the second half of 2025. I'd like to point that out, this is an event-driven trial.
Matt Shawlis: purely this is based on the, you know, events occurrence. With that, I'll probably pause. Oh, you'll have a question related to the breast cancer side of it. We're still in discussion with our partner around the development of the ZANI in the breast cancer franchise.
Speaker Change: Sure, and then maybe I can talk about spontaneous use on Burkinsa and certainly understand the nature of the question given our best-in-class profile for BTKs, but I think it's also
Speaker Change: How youre thinking about the upcoming Readouts.
Speaker Change: One CLO and the data, they're generating again and group of clubs.
Speaker Change: What are you going to be watching for there and what will be the appropriate with kinder.
Rothschild Aaron: Rothschild Aaron's.
Rothschild Aaron: I E should investors buying those other ratios that your trial.
Rothschild Aaron: Why or why not.
Rothschild Aaron: I. Appreciate you guys are taking your integrator against personnel, but thinking about central Europe.
Rothschild Aaron: Thank you.
Speaker Change: Simply so much for the question first of all it does have two phase III trials ongoing in the <unk> CIL, although the second choice a mixed population the first Charlie I assume you're referring to just a few wall Street study, which has put portola is being compared to accumulate immunotherapy I do want to highlight.
Speaker Change: Accumulated most IOP is no longer really a standard chip for the <unk> sale.
Speaker Change: Study the readout does not necessarily mean what changed the practice.
Speaker Change: So this will be a study similar to what stem from <unk> debt, which is against another standard.
Speaker Change: The second study is <unk>.
Speaker Change: And design. This is a mixed operation was up to 30% of patients being the tumor nave <unk> patients and that while the others.
Speaker Change: Battery cell patients.
Speaker Change: This study is actually I wanted to find out is with <unk> as the primary end points with 90 <unk> study design.
Even if this study has the positive readout, we don't believe this wont be practice changing in the also the comparator here is it puts a net not to the best in cost PTK inhibitor designed inputs in it so.
Speaker Change: I think we'll evaluate to watching this data readouts and I think if <unk> taken any significant kind of showing the functionality that will require us really compared to <unk> and there was a much longer follow up so we do not believe that this short term which ends the dynamics.
Speaker Change: The adaption of the PTK inhibitors in the frontline.
Speaker Change: Principally as probably as well positioned as deputy King <unk> after you finishing.
Speaker Change: After the patients finishing treatment with the KOL womens PTK inhibitor.
Speaker Change: We're very excited about our CDK, our PD Kate the greater the form our data reported at Ash. We believe this molecule demonstrated better safety and better efficacy compared to <unk>. This is why we're going ahead with a hazard high child versus protocols.
Speaker Change: To get this <unk> and the potential to provide patients with a better treatment option. After you finish in <unk>.
Speaker Change: Okay. Thank you.
Speaker Change: Okay.
Speaker Change: Our next question comes from Eagle not some of it's from Citigroup. Please mute your line and ask your question. Thank you.
Speaker Change: With the strong quarter.
Speaker Change: Hopefully you can hear me.
Speaker Change: I had a question regarding the comment on the patent.
Speaker Change: Settlement for Britain's first of all was that in keeping with your expectations for 2037, but then more importantly, assuming you get combo data with Sun row of Pru.
Speaker Change: Is there any way that could protect you from a generic if you were to work on a fixed dose oral combo.
Speaker Change: Are you are working on that strategy. Thank you.
Speaker Change: Thanks for the question so certainly.
Speaker Change: We have publicly disclosed where we are with respect to our returns.
Speaker Change: Ginza patent protection and as you said.
Speaker Change: In 2037.
Speaker Change: What we've talked about that's a starting point.
Speaker Change: As it relates to our broader franchise certainly when you think about the combination of our assets.
Speaker Change: We're really seeking to fill all dimensions of the patient journey and that is a long lived franchise.
Speaker Change: Our assets beyond Potenza, obviously being still in development have patent protection well beyond that point in time. So we see this as a franchise that's durable sustainable most importantly will fulfill a significant unmet need in the market and position best in class treatments for all patients with <unk>.
Speaker Change: Hello.
Speaker Change: Thanks for the question Okay. Okay. Thank you.
Speaker Change: Our next question comes from many Benjamin citizens JMP. Please mute your line and ask a question.
Speaker Change: Okay.
Speaker Change: Hey, congratulations.
Speaker Change: Great 2024.
Speaker Change: Right.
Speaker Change: Can you guys can you guys hear me.
Speaker Change: Yes.
Speaker Change: Got it. Thank you congratulations on an amazing 2024.
Speaker Change: We're making 25 guidance my.
Speaker Change: My question's on the completion of enrollment of the celestial study can you.
Speaker Change: Talk a little bit about how you're thinking about the event rates going forward when we might expect top line data and a potential NDA submission.
Speaker Change: Okay.
Speaker Change: Yes. Thank you very much for the question.
Speaker Change: We're very excited about this study is being able to finishing enrollment seen just about 14 months. This again demonstrated our ability to really execute late stage can push house.
Speaker Change: For the events side of it with the not guided this study.
Speaker Change: Events driven PFS.
Speaker Change: PFS was upon that importance.
Speaker Change: Why are you going to as you are waiting for the states we readout.
Speaker Change: The control arm is the yields so you would take a little time to answer that readout.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Michael.
Speaker Change: <unk> Chen of Goldman Sachs. Please.
Speaker Change: Please mute your line and ask you a question.
Speaker Change: Thank you mentioned San Francis My questions.
Speaker Change: Great quarter.
And our fourth quarter 2024.
Speaker Change: My question is really regarding.
Speaker Change: The router clocks casino fresh lie.
Speaker Change: How do you see the potential patients contracts I think kind of a quicker.
Speaker Change: Our Asian entrepreneur or it's going to be.
Still more on PDK mono therapies, the reason I'm asking this because.
Speaker Change: The slides that map was showing after about that prescription on <unk> and the fresh Leigh will still see only about 50% of patients actually I wanted to get I will wrap up the 50% if all of the trim and so I'm kind of wondering why the fixed duration coming to the market.
Speaker Change: And what's going to be there on patient and physician preference.
Speaker Change: And also what could be the potential impact on the whole franchise sells given that fixed duration are definitely going to be triggering a shorter duration determined for SaaS.
Speaker Change: Okay.
Speaker Change: So I'm wondering what's going to be how you think about the overall franchise impact when the fixed duration, so kind of come into the market or are you thinking about potentially we're going to start with fixed duration than we're going to have patient kind of switch back to cancer monotherapy for a longer term maintain and tenants therapy.
Speaker Change: Thank you.
Speaker Change: Thanks for the Great question I think first of all.
Speaker Change: Fixed duration means lots of things chemo as fixed duration I think you have fanatic clocks viau combinations and then I think you have <unk>, which is not approved in the U S and Europe, AAV, which has a study that we will seek approval and we'll see how that plays out.
Speaker Change: Think that what we've laid out for you is when you actually look at this data versus continuous for Ken.
Speaker Change: Continuous per ken's on looks like a better option for those patients.
Speaker Change: I think also fixed duration should not be confused.
Speaker Change: With intermittent therapy.
Speaker Change: Really what you are talking about this study.
Speaker Change: Highly selected <unk>.
Ultra fit population.
Speaker Change: Only relevant for a quarter of the patients not deletion <unk> patients, which have worse outcome not older patients not less healthy patients in that population you are still seeing.
Speaker Change: Close to a quarter of the patients progressed within three years remember they were on treatment for 14 months.
Speaker Change: That's only 20 months of being off treatment and they progressed a quarter of the patients and if you look at the shape of that curve you can jump back to it look at it right after 36 months.
Speaker Change: Let's look at it.
Speaker Change: And again highly selective this is like as good as it could possibly got a real world experience is going to be a much much called the patients with much.
Speaker Change: Worse outcome.
Speaker Change: You just compare that to a continuous therapy.
Speaker Change: It's underwhelmed distressed underwhelmed, so I think if that's the hurdle you're looking at it you really have a choice between <unk>, which is a huge talks burden.
Speaker Change: Huge burden on patients and even Spi when you actually look at the patient journey on it it's no matter its probably worse than chemo in the burden to a patient.
Speaker Change: <unk> at the monitoring associated with Vanadic clocks, So we don't anticipate to dramatically change this percentage.
Speaker Change: Fixed duration versus continuous therapy, and actually we think theres an opportunity for continuous therapy to try to work its way more broadly into some of those patients.
Speaker Change: 50% that R&R continuous therapy today and of course, we're the leader in that space, but more importantly, as we've laid out.
Speaker Change: <unk>.
Speaker Change: Plus brookins on finally looks like its a fixed duration where.
Speaker Change: The squeeze in the juice make sense together.
Speaker Change: And that would be a first and I think we do believe that if we can continue to mature that data and it looks the way. It is that for the patients that are on fixed duration, which is roughly half the patients whether it's chemo, whether it's other clocks based therapies.
Speaker Change: This will.
Speaker Change: Stand out as a much better option at all.
Speaker Change: And from that perspective, we should really be able to expand into that area.
Speaker Change: All of that said.
Speaker Change: Still for cancer monotherapy, we believe has a strong OLED.
Speaker Change: For patients that are hard to treat you have to have a lot of confidence to take people off and stop therapy, everyone likes it the promise is good but.
Speaker Change: But if you don't have <unk> negativity.
Speaker Change: That's a bold thing to do.
Speaker Change: And if you don't have PFS, but really does look better it's a hard thing to do but I think that.
Speaker Change: With more and more experience, we are very comfortable with.
Speaker Change: The role of continuous monotherapy moving on we believe with the southern or combinations, there's huge opportunity in half of the patients who are really not reaching right now and I think from the other perspective.
Speaker Change: Just you know.
Speaker Change: Simply put.
Speaker Change: This is a franchise that will require combinations.
Speaker Change: That will have four different types of patients continuous therapy and fixed duration and the three agents. We have I think as we've said.
Speaker Change: Single agent combinations, we can cover this entire space will be probably can cover it with better outcomes for patients and every static.
Speaker Change: And we're excited about that and even fixed duration, even with Sony.
Speaker Change: Broke enzyme.
It's not going to be.
Speaker Change: Fixed duration, where you stop and Theres never any progression there will be for crushing and there will be retrieved.
Speaker Change: Months' refractory market, which will be substantial.
Speaker Change: It's not yet a cure as far from that.
Speaker Change: Okay.
Speaker Change: Got it that's very clear thank you Chuck.
Speaker Change: Our next question comes from Michael Schmidt.
Speaker Change: Hi partners. Please limit your line and ask your question.
Speaker Change: Yeah.
Christiane: Hey, guys Christiane for Michael here and congrats on the progress in 2012, Brian We're definitely looking forward to the year ahead.
Christiane: A follow up on CDK, Laura you mentioned that the data will be <unk>, if I heard that correctly I guess, how are you setting expectations for that data disclosure.
Speaker Change: Additional efficacy signals would you want this data further support your plan. Thanks stage about <unk> will be differentiated from other program. Thank you.
Christiane: So can I ask you to repeat.
Speaker Change: Your question on which day that yoga funds.
Speaker Change: CDK four okay got it.
Speaker Change: Thank you so much for the question the CDK four and are we already seeing a very interesting data from our dose escalation, where really you need.
Speaker Change: Safety expansion cohort and to determine what would be I'll, let those taking forwards.
Speaker Change: The setup data as I mentioned today, we are very excited about which is consistent with our personal cloud success with better selectivity and the better potency seems like now this is translating into.
Speaker Change: They are they in the clinical side of that weighs less skin toxicity, but we're also seeing a better targeting inhibition with a tier one assets.
Speaker Change: So with that and we are going to analyze all the data.
Speaker Change: Coming in to really make a decision whether or not you are starting the pivotal trial in the later part of this year or the next year.
Speaker Change: Got it thanks, a lot guys.
Speaker Change: Yeah.
Speaker Change: Our next question comes from Jean Ann.
TD Cowen Please Amit your line and ask your question. Thank you.
Speaker Change: Hi, yes. Thanks. This is gino on for you Ron Thanks for taking my question Congrats on a great quarter in 2025 guidance just a few quick ones from me number one what are you expecting on Zimbra and Youre in the U S. In EU for your 2025 guidance number two on your radar.
Speaker Change: Evaluate from chemo free combination.
Speaker Change: Ken Zaslow morale or CD 20 by specific.
Speaker Change: What are you most excited about and how confident are you that you can maybe move you on to cleaner up into earlier lines and see all thanks so much.
Speaker Change: So I'll start with your question. Thank you so much to Zimbra continues its strong growth trajectory.
Speaker Change: We can certainly reflect on our 2020 for performance.
Speaker Change: Broadly obviously, we continue to be the leading PD, one in China and we have.
Speaker Change: Several new indications that are at our Dl eligible this year and we look forward to continuing to commercialize those and expand our leadership with the broadest and RTL reimbursement coverage.
Speaker Change: In the class and I would reflect 2024 had a pricing impact.
Speaker Change: That was not immaterial.
Speaker Change: Phil It's showed an extreme really strong growth 2025 doesn't have that dynamic as we think about the launches in both the U S and Europe. We're very early days as I mentioned in my prepared remarks.
Speaker Change: We are investing in a targeted way.
Speaker Change: Like the response, we're seeing in the market, but at this point, we'll continue to keep you all updated in 2025 as we get more experience with the product in the marketplace. So with that I'll hand, it over to <unk>.
Speaker Change: Final question relates with the greater the platform trial.
Speaker Change: We're actually excited about all three as you mentioned in some point in combination ways. So.
Speaker Change: As far as combination was booked.
Speaker Change: The CD <unk> Bispecific. The reason for that is that probably used for different indications. We do not believe that degree theres only position to foster this definitely utility also.
Astellas side of that probably will be more excited to see the data in some combination with subtle as was was book construct but also ICL. There's other indolent lymphomas, which PDK has definitely demonstrated efficacy with into the combination with ceded 20 City street by specific, especially particularly Pablo baseball.
Speaker Change: Philippa lymphoma marginal zone would be quite exciting so we're eagerly waiting for data readout from that trial.
Speaker Change: Thanks, so much.
Speaker Change: There are no further questions I will turn the call over to Jon Wheeler for closing remarks.
Speaker Change: I just wanted to thank you all.
Speaker Change: For joining us today and for the thoughtful questions.
Speaker Change: I think that as you know our vision at the company is to do Great Science.
Speaker Change: Make truly impactful medicines that can help patients with cancer and to pursue a business model, which is different for example, with our internal 3700 person global clinical team.
Speaker Change: So that we can make medicines faster and more cost effectively than other companies, which enables you to have an attractive.
Speaker Change: Preferential set of returns with our company.
Speaker Change: I think today. The goal is also to show that we can do that and break Madison is more affordably and more accessibly in Ah patients here in the U S and around the world and we are well on our way to doing that and I think we're doing that in a framework that is economic that they were showing.
Speaker Change: It works and whether it's the speed of the trial enrollments, whether it's the quality of the data that you see in this presentation I think we're well on the way to living up to that very bold mission and vision that we have and I just want to conclude the call with thanking all of our investors.
Speaker Change: And analysts for their help in supporting the company or the team here for all they're doing and the clinicians and the patients across the world that have really helped drive.
Speaker Change: The data collection to help us understand which of the medicines. We're developing are really impactful. So that we can put our resources behind them and bring them to patients and we very much look forward to continuing this journey with all of you and thank you for permitting us to.
Speaker Change: Live this real privilege dream that were incremental off which is.
A lot of fun. So thank you.