Q1 2025 Amicus Therapeutics Inc Earnings Call
Later, we will conduct a question and answer session and instructions will follow at that time as a reminder, this conference call. It is being recorded I would now like to turn the conference call over to your host Mr. Andrew <unk>, Vice President of Investor Relations you May now begin.
Jeff Castelli: So, starting here on slide 15, focal segmental glomerulosclerosis, or FSGS, is a rare and serious kidney disorder characterized by segmental scarring of the glomeruli, which are the filtering units of the kidney, proteinuria, which is the leakage of protein out of the kidney into the urine, and a progressive decline in kidney function, often culminating in end-stage renal disease. The underlying causes of FSGS are various, including immune factors, genetic viruses, adaptive factors. But the key is that all of these converge on some podocyte injury that triggers then a pathogenic feedback loop of hemodynamic stress and inflammation that drives further fibrosis and progressive kidney damage.
Thank you Travis good morning, Thank you for joining our conference call to discuss amicus Therapeutics first quarter 2025 financial results and corporate highlights leading today's call. We have Bradley Campbell, President and Chief Executive Officer, Sebastien Martel, Chief Business Officer, Dr. Jeff Castelli, Chief Development Officer, Simon Harford Chief financial.
Officer, joining for Q&A is Alan Rosenberg, Chief legal officer.
As referenced on slide two of the presentation I would like to remind you that we will be making forward looking statements on today's call I encourage you to read the disclaimers in our slide presentation. The press release, we issued this morning and the disclosures in our SEC filings, which are all available on the IR portion of our corporate website forward looking statements are subject to substantial risks and uncertainties.
Jeff Castelli: The average time from diagnosis to onset of complete kidney failure is typically in the 5 to 10 year range. In the U.S., FSGS affects more than 40,000 people, with about 5,000 new cases diagnosed each year. There are currently no FDA-approved therapies, and standard of care includes non-specific therapies like corticosteroids, calcineurin inhibitors, and angiotensin receptor blockers, none of which adequately address the monosate-driven inflammatory component of FSGS. DMX-200 is an oral small molecule taken in combination with ARBs to target the monocyte-driven inflammatory component of the disease by specifically inhibiting the inflammatory signaling from angiotensin 1 receptor and chemokine receptor type 2 heteromers that are on inflamed kidney cells.
Speaker Change: Speak only as of the calls original date, and we undertake no obligation to update or revise any of the statements. Additionally, you are cautioned not to place undue reliance on any forward looking statements. At this time, it's my pleasure to turn the call over to Bradley Campbell, President and Chief Executive Officer Bradley.
Bradley Campbell: Great. Thank you Andrew and welcome everyone to our first quarter conference call before we get into the details with the backdrop of what has certainly been a tumultuous quarter in biotech I thought it would be valuable for me to frame the incredibly positive outlook, we see for amicus going forward.
Bradley Campbell: First of all I'm very pleased to share that we have delivered yet another quarter of strong double digit revenue growth on our core business in Pompe and fabry.
Jeff Castelli: Moving on to slide 16, we're impressed by the strong momentum DIMERICS has built and the growing body of evidence supporting DMX200 and FSGS. Mechanistic data show that DMX200 is a precision therapy targeting the monocyte-driven inflammatory feedback loop without broadly suppressing immune function. This is reinforced by compelling preclinical proof-of-concept data. These two studies across 80 patients have demonstrated encouraging efficacy and safety signals with meaningful reductions in both proteinuria and inflammation shown in FSGS patients. The Pivotal Phase 3, Action 3 trial is progressing very well, with 185 of the target 286 patients enrolled. The study is very robustly designed and strongly powered.
Bradley Campbell: It is now our 11th consecutive quarter with double digit sales growth and we see that trend continuing for years to come.
Bradley Campbell: Second we were thrilled to have entered into a strategic collaboration with <unk> that for a modest upfront brings into our pipeline. The U S commercialization rights to a first in class compound in late phase III development for a rare fatal kidney disease with blockbuster market potential.
Bradley Campbell: Third we continue to strengthen and diversify our supply chain.
Bradley Campbell: Through prudent operations and planning, we were able to effectively neutralize exposure to any potential tariffs. This year. We also announced today that we're onshoring of portion of our drug product manufacturing for PON ability to enhance our diverse based diversification strategy even further.
Bradley Campbell: Fourth while quarterly revenues for the <unk> and Pompe, we're impacted by some unexpected factors. We are highly confident in the acceleration in sales we will see through the remainder of the year, resulting in combined revenue projections within 2% of our original guidance and yet another year of double digit growth.
Jeff Castelli: Importantly, there is also now FDA alignment on pertinent area as the primary endpoint for approval. Notably, the first interim analysis conducted by DMERICS last year after 36 weeks of treatment showed DMX200 outperforming placebo in reducing proteinuria. Taken together, we believe these results strongly position DMX-200 to be a truly meaningful advance in the treatment of FSGS.
Bradley Campbell: Fifth we reiterated our confidence that these two products each with potential blockbuster sales at peak will reach combined sales of $1 billion by the end of 2028.
Jeff Castelli: Turning to slide 17, as I mentioned, action three is well underway. This is a global, randomized, double-blind, placebo-controlled study of DMX200 versus placebo in patients receiving ARB. and they are followed for 104 weeks. Based on a successful meeting, as I mentioned, with the FDA just here in March, the primary endpoint of the study will be a change in proteinuria, measured as urine protein to creatinine ratio with EGFR slopes serving as a secondary endpoint.
Bradley Campbell: And finally, as we maintained our financial discipline and we reiterated that we are on track to achieve GAAP profitability in the second half this year.
Bradley Campbell: Taken together, we are confident that we have achieved this quarter leaves amicus uniquely well positioned to create substantial value for shareholders and deliver on our mission for patients with.
Bradley Campbell: With that let me hand, the call over to Sebastian to dive into the business in more detail Sebastian.
Sebastian: Thank you Bradley and good morning to everyone.
Sebastian: <unk> slide five you see the revenue reached $142 million up.
Jeff Castelli: Subject to recruitment rates, which is going very well, full enrollment of Action 3 is expected around the end of the calendar year. An additional blinded interim analysis is also planned to occur once additional interactions have happened with Parasol and with the FDA to align on the final primary and secondary endpoint parameters.
Sebastian: 6% at constant exchange rates.
Sebastian: Underlying growth of this product remains very positive.
Sebastian: With a number of new patient starts globally up 14% in the quarter.
Sebastian: This puts us on track to deliver the highest level of patient stock this year.
Simon Harford: With that, let me now hand the call back over to Simon, or sorry, to Simon, to review our financial results and outlook. Simon. Thank you, Jeff. Our financial summary begins on slide 19 with our income statement for the first quarter ending March 31st, 2025. For Q1, we achieved total revenue of $125.2 million. which is a 13% increase over the same period last year. At constant exchange rates, revenue grew 15%. The global geographic breakdown of total revenue in the quarter consisted of 75.2 million or 60% of revenue generated outside the United States and the remaining 50 million or 40% coming from within the U.S.
Sebastian: We ended the quarter with more than 69% of the global market share of treated fabry patients with amenable mutations.
Sebastian: Gaslog is clearly positioned as the treatment.
Sebastian: Amongst prescribers and there are still many more potential patients eligible for our therapy.
Sebastian: Turning to slide six our leading markets continued to be the biggest driver of strong patient demand.
Sebastian: The U S contributed significantly growth.
Sebastian: And we reached a record number of patients who've got a holds in Australia. Following the first line use thing.
Sebastian: When we look at the global mix, which was about 65%, even 35% switch we're seeing stronger uptake in naive populations we.
Sebastian: We continue to achieve high market shares in countries, where we've been approved the longest but theres still plenty of opportunity to switch patients over to Garfield and to keep growing the market as we penetrate the diagnosed untreated and newly diagnosed pigments.
Simon Harford: Cost of goods sold as a percentage of net sales was 9.3% for the first quarter as compared to 12.3% for the prior year period. Total GAAP operating expenses decreased to $121.5 million for the first quarter as compared to $124.6 million in the first quarter of 2024, a decrease of two percent. On a non-GAAP basis, total operating expenses increased to $94.5 million for the first quarter as compared to $85.6 million in the same period last year, an increase of 10%. We define non-GAAP operating expenses, research and development, and SG&A expenses, excluding stock-based compensation expense, loss on impairment of assets, changes in fair value contingent consideration, restructuring charges, and depreciation and amortization.
Sebastian: Turning to the revenue impacts in the quarter.
Sebastian: While the U S grew at 18% this quarter, we observed non linear order patterns ex U S. In Q1 sales in the U K were impacted by the higher Deepak rebates than prior industry guidance had assumed.
Sebastian: With underlying growth in patient with demand at 14%.
Sebastian: <unk> have a record level of new patient starts this year will remain highly confident in our full year 2025 growth guidance, what kind of food.
Sebastian: The key drivers behind the growing demand for <unk>, which we expect to continue well beyond 2025.
Sebastian: Following first finding new patients and reaching the diagnosed untreated population, including sharpening of the pathway to diagnosis.
Sebastian: Second expanding get pulled into new markets and extending the label.
Sebastian: Third driving <unk> share of treated amenable patients were actually seeing in our most mature market that we can reach up to 85% 90% share. So we know that there's the potential to reach those levels globally.
Simon Harford: On a gap basis, net loss in the first quarter of 2025 was $21.7 million. or $0.07 per share compared to a net loss of $48.4 million or $0.16 per share for the first quarter of 2024. In the first quarter of this year, non-GAAP net income was $9 million or a profit of $0.03 per share. compared to non-GAAP net loss of $4.6 million or a loss of $0.02 per share in the same period last year. Cash, cash equivalents and marketable securities were $251 million at March 31, 2025 compared to $250 million at December 31, 2024.
Sebastian: Fourth sustain.
Sebastian: Sustaining compliance and adherence.
Sebastian: Above 90% rates, so that patients who go and get a cold predominantly stem got a hold.
Sebastian: So with our strong IP protection, we think that the holders of long runway well into the Mexican market and a clear path to surpassing $1 billion in revenue in the next 12 years.
Sebastian: Turning now to compare disease on slide eight we are.
Sebastian: Outline our global launch progress with complete agenda pull down.
Sebastian: In the first quarter revenue reached $21 million up 92% at constant exchange rates.
Sebastian: The majority of growth was driven by three of our initial launch countries. The U S, Germany and Spain.
Sebastian: The U S represented approximately 45% of revenue and contributed to 65% of <unk> pulled that growth in the culture.
Simon Harford: On slide 20, we outline our full year financial guidance for 2025. Total revenue growth guidance is updated to 15% to 22% from the previous 17% to 24%. We are reiterating Garlafold revenue growth guidance of 10% to 15%.
Sebastian: Outside of the U S revenue growth was largely driven by Germany, and Spain with UK sales impacted by the <unk>.
Sebastian: We continued to see patients switching proportionally based on market share.
Sebastian: Well as broadening and deepening our prescriptions with more sites coming online and multiple new prescriptions from physicians.
Simon Harford: We are revising POMBILITY and OPFOLDA revenue growth guidance. to 50 to 65% from the previous 65 to 85%. All growth rates are at CER. Gross margin is still expected to be in the mid 80s.
Sebastian: We expect the benefit of patient starts new launch markets to be weighted towards the second half of the year Adil.
Sebastian: Additionally, in the U S. We anticipate sales to accelerate over the remainder of 2025 as the pool of patients eligible continues to expand.
Simon Harford: We are updating our non-GAAP operating guidance to include the $30 million upfront license payment for the DMX-200 licensing. Non-GAAP operating expense guidance is therefore expected to be $380 to $400 million. We anticipate positive GAAP net income during the second half of 2025.
Sebastian: We're already seeing some of this acceleration in the month of April with the largest number of net new commercial patients globally, driven by the U S as well.
Sebastian: Well as the largest number of countries with new prescriptions since launch.
Sebastian: Despite this momentum.
Sebastian: We do not expect that we'll be able to fully catch up with our prior 2025 guidance and so that's why we are adjusting our full year 2020 revenue growth guidance for completion of pull down.
Simon Harford: As mentioned earlier this year, we anticipate 2025 to be a hybrid year for POMBILITY and OPFOLDER COGS. as we expect to work through the previously expensed inventory during the first half of the year. As a result, we expect our gross margin to be in the mid-80s for the full year as we begin to recognize POMBILITY op folder COGS through the P&L later this year.
Sebastian: 65 to eight 5%.
Sebastian: 250% to 65% at constant exchange rates.
Our revised revenue guidance implies a healthy exit rate heading into next year.
Sebastian: We remain highly confident in the long term outlook of this therapy, we expect complete tenant pulled out to be a major contributor to multiyear growth, where amicus based on key growth drivers, namely.
Sebastian: Namely continuing to increase the number of net new patients increasing the depth and breadth of prescribers launching in new countries, including up to 10% in 2025.
Simon Harford: In terms of operating expense, as a reminder, we continue to have R&D commitments, including registry studies in both Fabry and Pompeii. The ongoing Pompeii Phase III study in countries not yet reimbursed. Next Generation Manufacturing Process Development for POMBILITY, as well as the DMX-200 upfront license.
Sebastian: Differentiating our therapy through evidence generation and real world evidence and maintaining 90% plus compliance and adherence rates.
Sebastian: Moving to slide nine looking at the geographic expansion of committed general pull down.
Bradley Campbell: And with that, let me turn the call back over to Bradley for our closing remarks. Great. Thank you, Simon, Jeff, Sbastien.
Sebastian: We recorded revenue in Q1 in seven countries. The U S, Germany, Austria, Spain, the U K as well as Switzerland and Sweden.
Bradley Campbell: As we come to the end of our presentation, here is a reminder of the strategic priorities for the year, reflecting the updates from today's call.
Sebastian: Five recently reimbursed countries, two markets, namely, Sweden, and Switzerland out of first patient stopped during the quarter.
Bradley Campbell: And before I conclude the discussion, I do want to take a moment to acknowledge Mike Kaveny, who was our president of the US business at Amicus and retired at the end of Q1. Mike is a great friend and colleague who joined Amicus in 2018 to lead the US commercial team, and he's been a critical part of our success with Galliford and Pomvilde in Apfolda. I want to thank Mike for his contribution to our mission and wish him so well in his retirement.
Sebastian: In Q2, we anticipate first patient in formal countries, namely, Italy, the Czech Republic, Portugal, and the Netherlands.
Sebastian: We're very pleased to share that completed in a pool that was recently selected as preferred treatment for it.
Sebastian: <unk> with <unk> in the Netherlands.
Sebastian: This is a five year agreements, enabling broad and sustained access for adults with LLP currently on enzyme replacement therapy.
Bradley Campbell: By the same token, I also want to give a warm welcome to Gwen Whitney, who has succeeded Mike in this role. Gwen is an energetic and accomplished leader in the rare disease space, and I very much look forward to her help in driving the U.S. business in the next phase of our growth.
Sebastian: We also recently received regulatory approvals in Australia and Canada.
Sebastian: And in Japan, I will just say is under review and we anticipate approval later this year.
Sebastian: Also securing broad patient access throughout the year.
Bradley Campbell: Finally, on the last slide, let me leave you the way I started. We are very pleased with the growing demand for both of our therapies and are extremely excited to bring in a promising phase three asset to our portfolio in an indication of significant unmet demand. I remain highly confident in our growth projection for the remainder of 2025 and for many years ahead, as well as our ability to deliver significant value for shareholders and for people living with rare disease.
Sebastian: Moving to slide 10, I'd like to take a few moments to provide additional color on the actions we've taken to further strengthen our global supply chain and access to our medicines.
Sebastian: Firstly regarding Paris, which we recognize are still evolving we do not expect a material impact to our business operations. This year due to our proactive supply chain planning and careful management of expenses.
Operator: With that, Operator, we can now open the call to questions. All right. Thank you. Okay.
Sebastian: We already have our 2025 sales inventory inside the U S.
Sebastian: We've also been proactive and diversifying our global supply chain.
Operator: So, ladies and gentlemen, if you have a question, please press star 11 on your touchtone telephone. At this time, we request that you only ask one question. If you do have any additional questions, please enter back into the queue. So, thank you.
Sebastian: In addition to our second source of <unk> drug substance manufacturing in Ireland, we're announcing today in manufacturing and supply services agreements with sharp steroid manufacturing.
Anupam Rama: Our first question today comes from the line of Anupam Rama of J.P. Morgan. Your line is now open. Hey guys, thanks so much for taking the question. Just one for me.
Sebastian: This agreement will bring a portion of community drug product manufacturing to the U S.
And with that I will now hand over the call to Jeff to highlight the work we do to further differentiate committee channel pull down.
Bradley Campbell: Was there something particular noted in the VPAG assessments for both Galafold and Pumbility at Folda that led to the rebate being a little bit higher than anticipated for both products? Thanks so much. Yeah, thanks, Anupam. You know, it's really frustrating. That's a negotiated rebate by the Industry Association in the UK, and they give guidance to industry of what to expect for the year. And so our guidance was between 12 and 15 percent. And we assumed the maximum of that rate, 15 percent, to be conservative. In the end, they came back with a negotiated rate of 22 percent, so almost a 50 percent increase in what we had anticipated.
Jeff Castelli: Thank you Sebastian and good morning, everyone.
Speaker Change: On slide 11, we highlight a few examples from the rapidly expanding and diverse body of evidence supporting the differentiation of homebuilding unfolded in Pompeii.
Speaker Change: First on clinical trials and long term data, we continue to see differentiated durability of effect in our ongoing clinical studies, including long term data from our phase II and phase III open label extensions, which reinforced the sustained efficacy and safety profile of <unk>, Florida.
Speaker Change: Second on mechanistic and translational insights emerging data continues to support the unique dual mechanism of action of our therapy.
Bradley Campbell: The challenge is, of course, that hits you in the quarter and then throughout the year, which is frustrating. But it is what it is. It's a one-time thing, and it's reflective of just a negotiated settlement with the government for all of industry. There's a lot of coverage of that in the UK press, as you might imagine.
Speaker Change: Not only the benefits of the App for the stabilizer, but also the differentiated design of the possibility enzyme alone which offers increased <unk> for greater cell uptake together with retained proteolytic in glick and processing for maximal enzyme activity. These mechanistic features are increasingly recognized as key driver.
Bradley Campbell: But now I think we can confidently say with Gallifold, we can make up for that based on the patient growth. And then you saw the revised guidance for Pondility Upfolder.
Speaker Change: There is a clinical outcomes.
Speaker Change: Third on comparative and real World evidence real world data from early access programs and treatment registries are showing consistent effects that mirror, what we've seen in clinical trials supporting both the efficacy and safety of homebuilding up, Florida and broader real world settings.
Anupam Rama: Thanks so much for taking our questions. Thank you.
Ellie Merrill: Our next question comes from the line of Ellie Merrill of UBS. Your line is now open. Hey guys, this is Kajasan for ELE.
Speaker Change: Comparative analysis continue to also add important context for how our therapy performs relative to other <unk>.
Sbastien Martel: I guess just in terms of the cadence of X US launches and patient starts What has changed on your expectations there and how much has that contributed to you guys taking down the POMOP guidance? Yeah, thanks for the question. I think there were, there's really two big elements there. The first is exactly as you said, you saw in previous slides, as we came into the year. And then we reiterated here, we reached a number of reimbursement settlements at the end of last year in the early part of the quarter. And we had assumed that those patients would start on therapy in the first quarter.
Speaker Change: And finally, we are seeing a growing number of powerful an illustrative real world patient stories. This includes individuals' switching to probability on a Florida from high dose high frequency <unk> as well as those switching from <unk>.
Speaker Change: These real world transitions further reinforce the clinical value and differentiation of Pompe is perceived by both physicians and patients.
Speaker Change: Importantly, beyond what's shown here, we continue to actively enroll into our pediatric clinical trials and enrollment continues to accelerate in the amicus Pompeii registry, which will generate invaluable additional real world data on a long term use of palm up across broader populations and geographies altogether.
Sbastien Martel: Unfortunately, many of them started, only a handful started in the first quarter, and many of them are starting to start in the second quarter. So really, that's a timing thing. So it's kind of just pushes the curve to the right. And then unfortunately, we do have that impact of VPAG. And as a reminder, the UK is one of our top three revenue markets for both POMOP and for Galliford. And so that ends up being a hit for the rest of the year. I would think of it mostly just based on what we're seeing in that acceleration that we've already started to see in April that we expect to see in the back half of the year, just a shifting to the right.
Speaker Change: Altogether, the strength and consistency of our data continue to give us great confidence that don't have Florida will continue to deliver meaningful and lasting impact for people living with Pompe.
Sebastian: Ill hand, the call back to Sebastian.
Sebastian: Thank you Jeff.
Speaker Change: So moving to slide 13.
Speaker Change: As we announced last evening, we took a major step forward in Australia due to strengthen our portfolio through a successful U S licensing agreements with <unk> to commercialize <unk> hundred a first in class treatments in late stage development for <unk>, a rare and potentially fatal kidney disease.
Sbastien Martel: And we have some great, you know, positives that we're seeing. We've already started patients now in Italy and Sweden and some other markets, Switzerland as well. And that Netherlands first position, I think will be a big growth driver for us in the second half of the year as well.
Speaker Change: This collaboration expands our late stage pipeline with a potential best in class treatment and brings significant opportunities to leverage our regulatory commercial medical and patient advocacy capabilities.
Sbastien Martel: Yeah, I guess just a quick on the Netherlands, how much of that impact is just coming from Netherlands? Because I know you mentioned it in the first quarter shifting to the right a little bit. Well, there are 150 plus patients, LOPD patients in the Netherlands, and they are, as we mentioned, we have now been awarded first position there. So that's a significant opportunity. One of the challenges is that it's only one center in the Netherlands that is treating the majority of those patients. And so there's a bit of a bottleneck there that is taking a little bit longer to get started.
Speaker Change: A promising late stage rare disease investigational medicine with blockbuster market potential. We believe this asset adds significant value to amicus today.
Speaker Change: We will create value for patients and shareholders.
Speaker Change: Slide 14 summarizes the transaction details.
Speaker Change: <unk> will receive an upfront of $30 million paid from amicus cash on hand.
Speaker Change: The deal is heavily weighted to success based milestones by which the next potential milestone payments would be for a positive readout from the phase III study.
Sbastien Martel: Again, we very much, you know, look forward to seeing that play out over the back half of the year and beyond. I would orient you also to Sweden, much smaller patient population, however, similar outcome where we were awarded first position and we're getting, you know, 80 or 90 percent of the patients there. So I think in the medium term, it's going to be a huge opportunity for us. But because of some of that kind of bottlenecking and getting started, those patients will fall into the second and third and fourth quarter.
Speaker Change: <unk> would receive tiered royalties of U S sales of <unk>, two hundreds that stopped in the low teens up to the low twenty's.
Speaker Change: Primaries will fund and execute the phase III study and amicus will be responsible for submission and maintenance of the regulatory dossier in the United States as well as all cost of commercialization activities.
Speaker Change: Let me hand over the call to Jeff to give you more insights on <unk> and the ongoing phase III study.
Sbastien Martel: Really helpful, thanks. Thank you.
Jeff Castelli: Thanks, Sebastian first I would like to again just to reiterate how extremely excited we are to work with <unk> on the further development of <unk> 200 to bring this potentially transformative treatment of patients suffering from STS.
Joseph Schwartz: Our next question comes from the line of Joseph Schwartz of Lyrics. Your line is now open. Great. Hey, all. This is Will on for Joe. Thanks for taking our questions today. So I'll switch it up and ask about DMX-200.
Bradley Campbell: So I guess on the licensing agreement here, it'd be a bit helpful to hear some more color on the diligence process and how you ultimately ended up settling on an asset in a rare renal disease. And what provided you with the confidence of the assets differentiation versus late stage competition? And maybe how do you see this kind of fitting into the overall treatment paradigm if approved? I think So I think you talked a little bit about the strategy, a little bit about the diligence, and then about the differentiation of the molecule.
Jeff Castelli: So starting here on slide 15, focal segmental <unk> lowest sclerosis or <unk>.
Jeff Castelli: A rare and serious kidney disorder characterized by segmental scarring of the culinary line, which are the filtering units of the kidney proteinuria, which is the leakage of protein out of the kidney into the urine and a progressive decline in kidney function often comedy, culminating in end stage renal disease.
Jeff Castelli: The underlying causes of ssds are various including immune factors genetic viruses adaptive factors.
Bradley Campbell: I'll start with maybe the first two and ask Jeff and Sebastian to add any color, especially on the differentiation, Jeff. So first and foremost, you might remember as we came into, finished last year and came into this year, what we described as our strategy was bringing into Amicus late-stage de-risked assets that we believed could meet a significant unmet medical need. We also talked about sort of how we would think about disease areas. And of course, Fabbrain Pompeii remained centered to our focus going forward, but we also talked about disease areas that could bring significant synergies.
Jeff Castelli: But the key is that all of these converge on some prototype injury that triggers then a pathogenic feedback loop of hemodynamic stress in inflammation that drives further fibrosis and progressive kidney damage. The average time from diagnosis to onset of complete kidney failure is typically in the five to 10 year range.
Jeff Castelli: In the U S S GFS effects more than 40000 people with about 5000, new cases diagnosed each year.
Jeff Castelli: There are currently no FDA approved therapies and standard of care includes nonspecific therapies like corticosteroids Carlson urine inhibitors, and angiotensin receptor blockers, none of which adequately address the manassei driven inflammatory component of SGS.
Bradley Campbell: And if you think about FSGS as a rare kidney disease, the endpoints, proteinuria, GFR, the call points, nephrologists, specialty medical centers, et cetera, very much synergistic with our capabilities and our team today.
Bradley Campbell: So we really felt like both the structure of the deal, which was a modest upfront and then really success-based milestones going forward, as well as the strategic fit was sort of perfect for what we were looking for as our first deal to expand the portfolio. In terms of diligence, of course, we looked very carefully through the data that was provided. We did a lot of market research, talked to physicians, worked very closely with Dimerix. It was a very, I think, collaborative process. What gave us particular conviction here from a diligence perspective was, of course, the phase two data, very compelling, the unmet need, very compelling.
Jeff Castelli: <unk> 200 is an oral small molecule taken in combination with arbs the target the monocyte driven inflammatory component of the disease by and <unk> by specifically inhibited inhibiting the inflammatory signaling from angiotensin one receptor and chemo receptor type two <unk> that are.
Jeff Castelli: And flame kidney yourselves.
Jeff Castelli: Moving on to Slide 16, we're impressed by the strong momentum <unk> built and the growing body of evidence supporting <unk> 200, and <unk> <unk>.
Jeff Castelli: <unk> data show that <unk> 200 is a precision therapy targeting the monocyte driven inflammatory feedback loop without broadly suppressing immune function. This is reinforced by compounding preclinical proof of concept data phase.
Bradley Campbell: Then also the interim analysis that Dimerix had previously shown that showed statistical favorability for proteinuria in that blinded analysis. That was a planned interim analysis that had already been conducted. And then if you combine that with the very recent FDA meeting and meeting minutes that we saw, confirming proteinuria as the primary endpoint, I think it'd give us great confidence that this is, again, a highly de-risked asset and likely to succeed.
Jeff Castelli: Phase III studies across 80 patients have demonstrated encouraging efficacy and safety signals with meaningful reductions in both proteinuria and inflammation shown in <unk> patients.
Jeff Castelli: The pivotal phase III action three trial is progressing very well with 185 of the target 286 patients enrolled the study is very robustly designed and strongly powered importantly, there is also now FDA alignment on proteinuria as the primary endpoint for approval.
Jeff Castelli: And maybe Jeff just hit quickly the differentiation point on the molecule itself in FSGS. Yes, thanks, Brad. And, you know, I think one of the things we're really excited about here is the mechanism of action of DMX200 and how differentiated it is. So when you look at standard of care, when you look at some of the other development compounds, none of them are targeting this monocyte-driven inflammatory component of the feedback loop. A lot of them are focused, you know, more on controlling the hemodynamic side of things through A1TR or through endothelin. And really what DMX200 is specifically targeting the inflammatory signaling in the damaged kidney.
Jeff Castelli: Notably the first interim analysis conducted by <unk> last year. After 36 weeks of treatment showed the Nx 200, outperforming placebo in reducing proteinuria.
Jeff Castelli: Taken together, we believe these results strongly position <unk> 200 to be truly meaningful advance in the treatment of <unk>.
Jeff Castelli: Turning to slide 17, as I mentioned actions III is well underway. This is a global randomized double blind placebo controlled study of <unk> 200 versus placebo in patients receiving <unk>.
Jeff Castelli: So, you know, FSGS, it's a very diverse disease, lots of underlying causes, lots of drivers of the ongoing damage. And I think what we're going to see is some patients are going to respond better if it's mainly a hemodynamic-driven challenge to ARBs or to new drugs like sparsentin that are targeting that side of things. And then patients that really it's that ongoing monocyte macrophage driven inflammation that's really driving things, they might respond better to DMX200. And then down the line, obviously, I think there's room for complementary approaches here because all of the drugs are targeting different aspects of the disease.
Jeff Castelli: And they were followed for 104 weeks based on a successful meeting as I mentioned with the FDA just here in March the primary endpoint of this study will be a change in proteinuria.
Jeff Castelli: Measured as urine protein creatinine ratio with egfr slopes, serving as a secondary endpoint.
Jeff Castelli: Subject to recruitment rates, which is going very well fall enrollment of action <unk> III is expected around the end of the calendar year and additional blinded interim analysis is also planned to occur once additional interactions have happened with parasol and with the FDA to align on the final primary and secondary endpoint parameters.
Jeff Castelli: And you might see that actually in some patients, a combination of these approaches might work best ultimately. But really that sort of also feeds into how we see this fitting in. You know, there's going to be some set of patients that respond better to one treatment than the other. And I think you're going to see physicians sort of trying to figure out how to identify which patients are most likely to benefit from which treatment. And really with DMX200, there are ways you can sort of look at how much the inflammatory component is driving things. And those would be the patients that I think docs would, those are going to be the patients we're going to see respond best in the trials.
Jeff Castelli: Let me now hand, the call back over to Simon sorry to Simon to review, our financial results and outlook climate.
Speaker Change: Thank you Jeff All financial summary begins on slide 19, with our income statement for the first quarter ending March 31st 2025.
Jeff Castelli: And those are going to be the patients that I think doctors would want to focus on.
Jeff Castelli: For Q1, we achieved total revenue of $125 2 million.
Bradley Campbell: Excellent, thank you. Thanks, Jeff.
Bradley Campbell: And maybe, Seb, anything on the other strategy? No? Okay. Thank you.
Jeff Castelli: Which is a 13% increase over the same period last year at constant exchange rates revenue grew 15%.
Ritu Baral: So our next question comes from the line of Ritu Baral of TD Cohen. Your line is now open. Hi, Bradley. This is Joshua Fleischman on the line for Ritu. Thanks for taking our question. On DMX-200, even if UPCR is a fully approvable primary endpoint, what is any benefit in EGFRs FDA looking for besides the primary? Two, what timeline should we expect for the next interim analysis, which is gated by Parasol and FDA? Does nine months sound reasonable? And three, what have you seen to justify acceleration of U.S. switches for PUM to HAP-25? Thank you.
Jeff Castelli: The global geographic breakdown of total revenue in the quarter consisted of $75 2 million or 60% of revenue generated outside the United States and the remaining $50 million or 40% coming from within the U S.
Jeff Castelli: Cost of goods sold as a percentage of net sales was nine 3% for the first quarter as compared to 12, 3% for the prior year period.
Jeff Castelli: Total GAAP operating expenses decreased to $121.
Jeff Castelli: $5 million for the first quarter as compared to $124 6 million in.
Bradley Campbell: Great, so maybe I'll start with Palmop first, and then Jeff, you can speak to those other points. So, you know, look, I think as Sbastien shared with you on the call, we're already seeing a significant acceleration in switches in Palmbility App Folder in the United States and around the world just in the month of April. So it was really, it was actually our best month for new commercial starts. So not clinical trial conversions, but new commercial starts since we've launched. So that's really exciting. Why are we seeing that? Part of it for sure is just the dynamic we had already talked about, which is more and more nexviazine patients entering into that two-year period.
Jeff Castelli: In the first quarter of 2024, a decrease of 2%.
Jeff Castelli: On a non-GAAP basis total operating expenses increased to $94 5 million for the first quarter as compared to $85 6 million in the same period last year, an increase of 10%, we define non-GAAP operating expenses research and development and SG&A.
Jeff Castelli: <unk>, excluding stock based compensation expense loss on impairment of assets changes in fair value of contingent consideration restructuring charges and depreciation and amortization.
Bradley Campbell: And I'll mention again that we saw in that period a majority of the switchers coming from nexviazine, so we're winning that game. I think also part of it is what Jeff talked about, which is the growing body of real-world evidence. We presented for the first time, or one of our thought leaders did at a medical congress, case studies supporting the switch from nexviazine for the first time. So that's, I think, really important real-world evidence that will continue to grow. And I do think too, we've talked about this before, we've always seen Q1 as a sort of non-linear quarter in February, and I think you may start to see that in Pompeii as well.
Jeff Castelli: On a GAAP basis net loss in the first quarter of 2025 was $21 7 million.
Jeff Castelli: Or seven cents per share compared to a net loss of 48 4 million or <unk> 16 per share for the first quarter of 2024.
Jeff Castelli: In the first quarter of this year non-GAAP net income was $9 million or a profit of <unk> <unk> per share.
Jeff Castelli: Compared to non-GAAP net loss of $4 6 million.
Bradley Campbell: So this could be a reflection of that. And then if you add in those kind of one-time factors we talked about, XUS, I think that kind of explains the quarter.
Jeff Castelli: Or a loss of <unk> <unk> per share in the same period last year cash cash equivalents and marketable securities with 251 million at March 31, 2025, compared to $250 million at December 31st 2024.
Bradley Campbell: Jeff, do you want to talk about FSGS and both the proteinuria GFR feedback from the FDA, which is fantastic, from the Type C meeting, and then also some of the early timelines that we have line-of-sight too? Yeah, thanks. And so, you know, importantly, the alignment with FDA was proteinuria as a primary endpoint for full approval, not accelerated approval within some other TBD endpoint like GFR for confirmatory, which we've seen now in other kidney diseases. I think what's really exciting is we're seeing FDA now move more and more towards recognizing proteinuria is so strongly tied to GFR decline and ultimate kidney progression that they're moving now more and more towards UPCR as the provable full endpoint.
Jeff Castelli: On slide 20, we outline our full year financial guidance for 2025.
Jeff Castelli: Total revenue growth guidance is updated to 15% to 22% from the previous 17% to 24%. We are reiterating <unk> revenue growth guidance of 10% to 15% we are revising possibility fold our revenue growth guidance.
Jeff Castelli: To 50% to 65% from the previous 65% to 85% all growth rates are at CER.
Jeff Castelli: And that's really driven by data in FSGS from the Parasol Initiative. That's 50 different researchers that have 1,600 plus FSGS patients, and they've really been, you know, key in helping to show that tight association between changes in proteinuria and changes in GFR. So, in terms of what we need to see on GFR, it's really not any specific set statistical test at this point. It just looks like we need to have a secondary endpoint on GFR that's supportive data, which we believe the design of the study is as well designed to show. In terms of the interim analysis, so, you know, the main discussion with FDA that Dimeric's had was alignment on proteinuria as that single primary endpoint.
Gross margin is still expected to be in the mid eighties.
Jeff Castelli: We're updating our non-GAAP operating guidance to include the $30 million upfront license payment to <unk> 200 licensing non-GAAP operating expense guidance is therefore expected to be $380 million to $400 million.
Jeff Castelli: Anticipate positive GAAP net income during the second half of 2025.
Okay.
As mentioned earlier this year, we anticipate 2025 to be a high brachia off a possibility or not fold our cogs as we expect to work through the previously expensed inventory during the first half of the year.
Jeff Castelli: There also was some talk about potentially an interim analysis to support accelerated approval. That will require additional analysis of that Parasol dataset, collaborating with Parasol, which will take about three to six months to conduct that work, then go back and meet with FDA, make sure there's alignment on all of the potential interim or accelerated endpoints, the full endpoints, and then conduct that interim analysis. So, I think nine months, as you said, could be, you know, in that ballpark, but really, after we get through this three to six months, we can start to get more timing specifically about the next FDA interaction and when that interim might occur.
Jeff Castelli: As a result, we expect our gross margin to be in the mid <unk> for the full year as.
Jeff Castelli: As we begin to recognize possibility all filled our cogs through the P&L later this year in terms of operating expense as a reminder, we continue to have R&D commitments, including registry studies in both tablet and Pompeii the ongoing Pompeii phase III study in pumps is not yet ramped.
Jeff Castelli: Great. Thanks, Jeff.
Jeff Castelli: <unk>.
Jeff Castelli: Next generation manufacturing process development for comparability as well as the DMX 200 upfront licensing fee and with that let me turn the call back over to Bradley for closing remarks.
Dennis Ding: Our next question comes from the line of Dennis Ding of Jefferies. Your line is now open. Hi, good morning. Thanks for taking our question. I had one on FSGS, specifically on the CCR2 mechanism.
Jeff Castelli: Hi.
Bradley Campbell: Great. Thank you Simon Jeff Sebastian as we come to the end of our presentation. Here is a reminder of the strategic priorities for the year, reflecting the updates from today's call.
Bradley Campbell: You know, I appreciate that Dimerics had already had positive phase 2 and phase 3 interim, but hemocentrics failed with phase 2 a few years ago in FSGS with the, you know, with the same mechanism. Can you comment on what happened there, if there was a drug target or trial design issue, and, you know, how the, you know, how may the drugs be different at this time? Yeah, it's a great question.
Speaker Change: Before I conclude the discussion I do want to take a moment to acknowledge Mike <unk>, who is our president of the U S business at amicus and retired at the end of Q1, Mike is a great friend and colleague who joined amicus in 2018 to lead the U S. Commercial team and he has been a critical part of our success with <unk> and possibility not pulled out I want to thank Mike for his.
Jeff Castelli: I think it's important that Jeff highlighted this, although maybe, Jeff, you can provide just a little bit more color there. This molecule, DMX200, is a differentiated CCR2 molecule, an inhibitor molecule, and so I think it's very important to highlight those differences. And so, Jeff, maybe share a little bit more of that color, specifically how it acts within the kidney. Yeah, thanks. That's a great question. You know, so there have been CCR2 inhibitors historically that have been tried by several companies and different diseases, mostly to try to knock down monocyte-driven inflammation. The difference with DMX200 is it's not a direct inhibitor of the binding of the MCP1, which is sort of the inflammatory signal to the CCR2 receptor.
Bradley Campbell: <unk> to our mission and wish him so well in his retirement.
Bradley Campbell: By the same token I also want to give a warm welcome to Gwen Whitney who have succeeded Mike in this role.
Bradley Campbell: Gwen has an energetic and accomplished leader in the rare disease space and I very much look forward to her help in driving the U S business in the next phase of our growth.
Bradley Campbell: Finally on the last slide let me leave you the way I started we're very pleased with the growing demand for both of our therapies and are extremely excited to bring in a promising phase III asset to our portfolio and an indication of significant unmet need.
Remain highly confident in our growth projections for the remainder of 2025.
Bradley Campbell: And for many years ahead, as well as our ability to deliver significant value for shareholders and for people living with rare diseases.
Jeff Castelli: Instead, DMX200 specifically acts downstream and blocks the signaling coming out of the A1TR-CCR2 heteromer that's on a damaged kidney tissue that acts as the amplification for inflammation. So, what happened with traditional binding inhibitors is MCP1 couldn't dock, and it actually led to a rebound effect where MCP1 levels dramatically increased, which then would compete with the inhibitor and kind of lead to a muting of effect. So, the beauty of the downstream blocking is that MCP1 can still dock. That leads to actually MCP1 degradation. The signal is stopped. So, we're actually seeing MCP1 levels come down with DMX200 versus increase, which is really sort of the benefit of having that downstream targeting.
Bradley Campbell: With that operator, we can now open the call to questions.
Bradley Campbell: Alright, thank you.
Speaker Change: Okay, So ladies and gentlemen, if you have a question. Please press star one on your Touchtone telephone at this time, we request that you only ask one question. If you do have any additional questions. Please enter back into the queue.
Speaker Change: So thank you. Our first question today comes from the line of <unk> Rama J P. Morgan Your line is now open.
Hey, guys. Thanks, so much for taking the question.
Speaker Change: Just one for me was there something particular noted in the <unk> assessments for both <unk> and possibility up holdup that led to the rebate being a little bit higher than anticipated for both products. Thanks. So much.
Jeff Castelli: We think that will really maximize the ability to shut down the monocyte inflammation. And the other great thing about that is it allows monocytes to continue their job elsewhere because we're not directly blocking the MCP1 binding to monocytes, so they can still fight infections as they should outside of the kidney.
Speaker Change: What to expect for the year and so our guidance was between 12 and 15% and we assume that maximum of that rate 15% to be conservative in the end. They came back with a negotiated rate of 22%. So almost a 50% increase in what we had anticipated the challenges of <unk>.
Jeff Castelli: Great, that's very helpful. Thank you. Thank you for the questions. All right, thank you.
Tazeen Ahmad: So our next question comes to the line of Tazeen Ahmad of Bank of America Securities. Your line is now open. Hi, good morning. This is Sharon for Tazeen. Thank you for taking our questions.
Speaker Change: That hits you in the quarter and then throughout the year, which is frustrating, but it is what it is it's a onetime thing and it's reflective of just a negotiated settlement with the government for all of the industry. There's a lot of coverage of that in the U K press as you might imagine.
Tazeen Ahmad: So you mentioned that this VTAG rebate drag is a one-time thing, so I wonder, like, can you clarify on that? Can you make sure that this is not a recurring event?
Sbastien Martel: Our second question is, how do you plan to message the positioning of POMOP versus the traditional ERT in the new 10 countries you plan to launch? And what have you been heard so far from the payers and providers?
Speaker Change: But now I think we can confidently say with <unk>, we can make up for that based on patient growth and then you saw the revised guidance for bundling up Volta.
Bradley Campbell: And our third question is, can you elaborate whether this e-license deal represents the beginning of the broader plan into nephrology or inflammation-related rare disease? Thank you. Yeah, so I think the first question was around VPAC. Just to be clear, we had anticipated, based on the guidance from the Industry Association, up to a 15% rebate. And what was provided, in fact, or what was decided and given to us was a 22% rebate. To be clear, that will impact revenue over the course of the year. And that's part of why, with POMOP, we've adjusted our guidance downwards.
Speaker Change: Thanks, so much for taking my question.
Speaker Change: Okay.
Speaker Change: Thank you. Our next question comes from the line of Elie Merrill UBS.
Speaker Change: UBS Your line is now open.
Speaker Change: Hey, guys can you just on for Lee.
Speaker Change: I guess just in terms of the cadence of ex U S launches in patient starts.
Speaker Change: What has changed on your expectations, there and how much of that contributed to you guys taking download palm op guidance.
Speaker Change: Yes. Thanks for the question I think there were there's really two big elements. There. The first is exactly as you said you saw in previous slides as we came into the year and then we reiterated here we reached a number of reimbursement of settlements at the end of last year and early part of the quarter and we had assumed that those patients would start on therapy.
Sbastien Martel: With GALIFOLD, because, again, of the strong patient growth, we believe we will be able to make up for that over the course of the year, which is great. VPAC is something that we've always had in our estimation as part of the arrangement between industry and the UK government. And so it's always part of our expectations and guidance. It's just very unusual to have this kind of significant increase in the eventual rate versus what they guide us to. So hopefully that gives you a flavor there.
Speaker Change: In the first quarter.
Speaker Change: Unfortunately, many of them started only a handful started in the first quarter and many of them are starting to start in the second quarter.
Speaker Change: That's a timing thing so it's kind of just pushes the curve to the right and then unfortunately, we do have that impact of the peg and as a reminder, the U K is one of our top three revenue markets for both Palmer and four per gallon fold and so that ends up being.
Speaker Change: A hit for the rest of the year I would think of it mostly just based on what we're seeing in that acceleration that we've already started to see in April and that we expect to see in the back half of the year, just a shifting to the right and we have some great positives that we're seeing we have already started patients now in Italy, and Sweden, and some other markets, Switzerland, as well and that Netherlands first position I think.
Speaker Change: It will be a big growth driver for us in the second half of the year as well.
Speaker Change: Yes, I guess, just a quick on the Netherlands, how much of that impact is just coming from Netherlands, because I know you mentioned it in the first quarter shifting to the right a little debt.
Speaker Change: Well there are 150, plus patients allo PD patients in the Netherlands, and they are as we mentioned we have now been awarded first position there so thats a significant opportunity.
Sbastien Martel: Maybe, Seb, just a quick reminder of the strategy around how we thought of this product and then what we think going forward. from from a BV perspective or portfolio perspective. Yeah, Brad. So, we did highlight in the past the areas of interest from some points. I think we have shared that we tend to think for our framework in adjacencies to our existing businesses. So, you know, looking at neuromuscular and rare kidney or rare cardiology assets, more broadly speaking, at rare metabolic disease, generally speaking. So, these are clearly the areas of interest. We, this particular deal here is for U.S.
Speaker Change: One of the challenges is that it's only one center in the Netherlands that is treating the majority of those patients and so there's a bit of a bottleneck. There that is taking a little bit longer to get started again, we very much look forward to seeing that play out over the back half of the year and beyond.
Speaker Change: Orient you also to Sweden, much smaller patient population. However, similar outcome, where we were awarded first position and we're getting 80% 90% of the patients. There. So I think in the medium term, it's going to be a huge opportunity for us, but because of some of that kind of bottlenecking in getting started.
Speaker Change: Those patients will fall into the second and third and fourth quarter.
Sbastien Martel: rights in FSGS, as well as in other indications, by the way, given our excitement around the MOA. And so, you know, we think that there's clearly an opportunity to expand in the rare kidney space with that specific asset in the U.S. We're also eager to continue to expand our portfolio on a global scale. So, interested to also leverage our capabilities ex-U.S. Great, thank you. Thank you.
Speaker Change: Really helpful. Thanks.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of Joseph Schwartz of Leerink. Your line is now open.
Speaker Change: Great.
Speaker Change: <unk> on for Joe Thanks for taking our questions for today, So I'll switch it up and ask about <unk> 200, So I guess on the licensing agreement here and be a bit helpful to hear some more color on the diligence process.
Speaker Change: Ultimately ended up settling on an asset in a rare renal disease and what provided me with the confidence that its differentiation versus late stage competition and maybe how do you see this kind of fitting into the overall treatment paradigm if approved thank you.
Kristen Kluska: So our next question comes from the line of Kristen Kluska of Cantor Fitzgerald. Your line is now open.
Speaker Change: So I think you've talked a little bit about the strategy a little bit about the diligence and then about the differentiation of the molecule I'll start with maybe the first two and ask Jeff Sebastian at any color, especially on the differentiation, Jeff. So first and foremost you might remember as we came into finished last year and came into this year, what we described as our strat.
Rick Miller: Hey guys, this is Rick Miller. On for Kristen. Thanks for taking our question. Just one on FSGS here. You talked about there potentially being kind of subsets of patients, maybe some that respond better from a hemodynamic-driven mechanism versus inflammatory-driven in FSGS. So to kind of get at this, is there any stat around what percentage of FSGS patients seem to be poor responders on ARBs, or how should we be thinking about that?
Speaker Change: <unk> was bringing into amicus late.
Late stage de risked assets.
Speaker Change: That we believe could meet a significant unmet medical need.
Speaker Change: We also talked about sort of how we would think about disease areas and of course, Fabry and Pompe <unk> remained center to our focus going forward, but we also talked about disease areas that could bring significant synergies and if you think about <unk> is a rare kidney disease. The endpoints scenario GFR the call points, Nephrologists specialty and medical centers et cetera.
Jeff Castelli: Yeah, just as a reminder, Jeff, I'll turn it over to you from a technical perspective. As a reminder, there are over 40,000 patients with FSGS or primary FSGS, at least in the United States, and we think a fairly sizable subset of those patients would be prime candidates for this product. But Jeff, maybe talk a little bit about sort of how we see as kind of the most obvious, most likely to be responders and then some of the other opportunities as well. Yeah, it's a great question. And so the focus of the patients for DMX200 in the trial are primary FSGS, which is sort of originally triggered by T cell insults that then causes feedback loop, and then also genetic, which is mainly driven by the ApoL1 patient.
Very much synergistic with our capabilities and our team today. So we really felt like both the structure of the deal which was a modest upfront and then really success based milestones going forward as well as the strategic fit with sort of perfect for what we're looking for as our first deal to expand the portfolio in terms of diligence of <unk>.
Speaker Change: We look very carefully through the data that was provided.
Speaker Change: We did a lot of market research talking to physicians worked very closely with <unk>. It was a very I think collaborative process. What gave US particular conviction here from a diligence perspective was of course, the phase II data very compelling unmet need very compelling then also the interim analysis that <unk> had previously shown.
Jeff Castelli: So in that group, what we're targeting there are patients, despite ARBs, despite corticosteroids, still have proteinuria, which is greater than 1.5 gram per gram that are in the trial. Unfortunately, that's actually a majority of FHDS patients that still, despite those treatments, still have significantly elevated proteinuria. And in those patients, in particular, the higher the proteinuria levels, it's more and more likely that they have an uncontrolled inflammatory component going on. So there's not great numbers about, you know, how many patients in that group have significantly elevated MCP1, for example. But through some of the work that Dimerics has done, what we'll continue to learn through the phase three, we think that is a significant percentage of those patients.
Speaker Change: That showed statistical favorability for proteinuria.
Speaker Change: In that blinded analysis that was a planned interim analysis that had already been conducted and then if you combine that with the very recent FDA meeting and meeting minutes that we saw confirming proteinuria as the primary endpoint I think that gives us great confidence that this is again, a highly de risked asset and likely to succeed and maybe Jeff just hit quickly the differentiation.
Jeff Castelli: On the molecule itself and it is Jeff.
Yes, Thanks, Brian I think one of the things. We're really excited about here is the mechanism of action of <unk> 200, and how differentiated it is so when you look at the standard of care. When you look at some of the other development compounds. None of them are targeting this manassei driven inflammatory component of the feedback loop a lot of them are focused more on controlling the hemodynamic side.
Jeff Castelli: And those are the ones in particular where we expect to see potentially a very robust response in terms of reduction of proteinuria. Also, you know, in others that might not be as elevated that are in the trial, or out there that might be treated down the line, you know, inflammation does start to kick up in these patients. So you might actually prevent kind of a worsening in addition to actually driving some improvement, in particular in those that are sort of have major ongoing inflammatory components. But I think we're going to learn more and more with FHDS that there's a lot of different mechanisms going on.
Jeff Castelli: Things through <unk> or through Endothelin, and really what <unk> 200 is specifically targeting the inflammatory signaling in the damaged kidney so at STS. It's a very diverse disease lots of underlying causes lots of drivers of the ongoing damage and I think what we're going to see is some patients are going to respond.
Jeff Castelli: I think we're going to start to really start to refine the different MOAs that are better for different types of patients. But we're super excited that we think DMX200 is going to address a significant percentage of those patients where it's really that inflammation that's driving it. Thank you. Thanks, guys. Thank you.
Jeff Castelli: If it's mainly a hemodynamic driven challenge to arbs or two new drugs like <unk> that are targeting that side of things and then patients that were really it's that ongoing monocyte macrophage driven inflammation, that's really driving things they might respond better to <unk> 200, and then down the line, obviously I think there's room for a complementary approaches here.
Gil Blum: So our next question comes to the line of Gil Blum of Needham and Company. Your line is now open. Good morning, everyone. And thanks for taking our question. Just maybe a couple of macro items. So you mentioned very limited impact of tariffs in 2025. But you know, looking into the future, is there going to be additional investment required in order to control potential for tariff impact in later years? And what is the impact of the weakening dollar?
Jeff Castelli: Does all of the drugs are targeting different aspects of the disease and you might see that actually in some patients combination of these approaches might work best ultimately, but really that sort of also sees into how we see this fitting in.
Jeff Castelli: There's going to be some set of patients that respond better to 100, and the other and I think youre going to see physicians sort of trying to figure out how do identify which patients are most likely to benefit from which treatment and really with the extra 100. There are ways you can sort of look at the how much the inflammatory component of driving things and those would be the patients that I think talks with those are going to be.
Simon Harford: Thank you Yeah, thanks, Gil. On the manufacturing side of things, you know, we, I don't foresee significant additional investment to be made to navigate around the tariffs. You might remember that we've already are well underway in moving the majority of our manufacturing to Ireland, and that will, I think, help diversify and de-risk the manufacturing, both cost and geopolitical location. And then, Sbastien and I mentioned on the call, we're moving some of the drug product manufacturing here to the United States, which, again, further diversifies. So, I think we feel very good about our ability to manage that going forward, despite the, you know, uncertainty that's out there.
Jeff Castelli: Patients were going to see respond best and the trials and those are into the patients that I think doctors will want to focus on.
Speaker Change: Excellent. Thanks, guys can you maybe.
Jeff Castelli: Anything on the.
Jeff Castelli: Other strategy Okay.
Jeff Castelli: Yeah.
Jeff Castelli: Okay.
Jeff Castelli: Thank you.
Speaker Change: Our next question comes from the line of Ritu barrel.
Speaker Change: PD Cowen Your line is now open.
Speaker Change: Hi, Bradley this is Joshua fleishman on the line for Ritu, Thanks for taking our quiet Josh.
Simon Harford: As it relates to the second one, just as a reminder, you know, a significant portion of our revenue comes from the pound, the euro, and the yen, and so a weak dollar for us generally gives us some FX benefit. However, we've tried to, I think, show in some of our slides just an example of what changes in the value of the dollar could impact our revenue. That's also why we focus on growth from a constant exchange rate perspective, but hopefully that gives you some flavor of, you know, in our case, a weakening dollar tends to help on the top line based on the majority of revenues coming outside the United States.
Speaker Change: On the <unk> 200, even if you PCR as a fully approvable primary endpoint, what if any benefit in Egfr is FDA looking for besides the primary two what timeline should we expect for the next interim analysis, which is gated by parasol and FDA does nine months sounds reasonable and what have you.
Speaker Change: Seem to justify acceleration of U S switches for pump to have 25. Thank you.
Speaker Change: Great. So maybe I'll start with Palm up first and then Jeff you can speak to those other point so.
Speaker Change: Look I think as Sebastian shared with you on the call we're already seeing a significant acceleration in switches and possibility up fold in the United States and around the world just in the month of April. So it was really it was actually our best month for new commercial starts.
Simon Harford: Thank you. So our next question comes from the line of Salveen Richter of Goldman Sachs. Your line is now open. Hi, this is Srinatra for Salveen. Thank you for taking our question. So regarding POMOP, could you maybe give some more color on the competitive dynamics in the U.S.? a good portion of patients on exercise I am coming into that appropriate window for switching and basically how are physicians at this point deciding between the two products and what sort of market feedback. Yeah, great questions. You know, one thing we would note, actually, and this is just public information, the global franchise for Sanofi and Pompeii actually declined by 5% in the first quarter.
Speaker Change: So not clinical trial conversions, but new commercial starts since since we've launched so that's really exciting why are we seeing that part of it for sure is just the dynamic we had already talked about which is more and more <unk> patients entering into that two year period and I'll I'll mention again that we saw in that period.
Speaker Change: The majority of the switches coming from next slides I'm. So we're winning that game I think also part of it is what Jeff talked about which is the growing body of real world evidence, we presented for the first time or one of our thought leaders did at medical Congress.
Speaker Change: Case studies supporting the switch from NEK buys I'm for the first time. So that's I think really important real world evidence that will continue to grow and I do think too we've talked about this before we've always seen Q1 is a sort of non linear quarter in February and I think you may start to see that in Pompeii as well. So this could be a reflection of that.
Bradley Campbell: So I think, you know, that shows that for the first time we are starting to meaningfully take share and impact their growth. And so you can see our 90% growth, obviously, in stark contrast with that. In terms of positioning, I think it continues to be what we've shared, which is, you know, in the United States in particular, once physicians start a patient on nexavizine, and that was the only choice they had because we weren't on the market yet, they want to give about two years of time before they're ready to switch again. And so having just big numbers of nexavizine patients coming into that switch period is helpful.
Speaker Change: And then if you add in those kind of one time factors, we talked about ex U S. I think that kind of explains the quarter, Jeff do you want to talk about.
Jeff Castelli: S SGS and both the proteinuria GFR feedback from the FDA, which is fantastic from a type C meeting and then also some of the early timelines that we have line of sight.
Jeff: Yeah. Thanks <unk> so.
Jeff: Accordingly, the alignment with FDA was pardon area as the primary endpoint for full approval not etcetera to approval within some other TBD endpoint TFR.
Bradley Campbell: And I think if you look at the acceleration that Sebastian talked about, and the proportion of patients coming majority from nexavizine, that continues to say that we will and are switching those patients. Most importantly, what they're looking at is decline in both six-minute walk and four-spinal capacity, but also some other patient-reported outcomes. And that's where the data that Jeff mentioned, the growing body of evidence looking at long-term impact, not just on those two endpoints, but also PROs, but then also these case studies and showing the support for the switch from nexavizine to palm off, I think is really important.
Jeff: For confirmatory, which we've seen now and other kidney diseases I think what's really exciting is we're seeing FTA now move more and more towards recognizing <unk> area is so strongly tied to GFR decline and ultimate kidney progression that theyre moving now more and more towards the PCR is the approvable endpoint.
Jeff: It's really driven by data and FSD us around the parasol initiative, that's 50 different researchers.
Jeff: That have 600, plus STS patients and they've really been key in helping to show that tight association between changes in GFR changes important area and changes in GFR. So in terms of what we need to see on GFR, It's really not any specific statistical test at this point and it just looks like we need to have a secondary.
Bradley Campbell: So those are the things that we think are going to continue to drive the switch and support that acceleration over the course of the year.
Bradley Campbell: Thank you. Alright, thank you.
Maxwell Skor: So, our last question comes from the line of Maxwell Skor of Morgan Stanley. Your line is now open. Great. Thank you for taking my questions. Could you elaborate a bit more on other potential indications amendable to DMX-200's MOA? And also, given the evolving regulatory landscape, could you share any insights or potential changes you might like to see at the agency to improve rare disease drug development or review efficiencies? Thank you.
Jeff: On GFR that showing supportive data, which we believe the design of the study is well designed to show.
Jeff: In terms of the interim analysis so.
Jeff: Named discussion with FDA that the American <unk> alignment on primary as that single primary endpoint.
Jeff: There also was some talk about potentially an interim analysis to support accelerated approval that will require additional analysis of that parasol dataset collaborating with parasol, which will take about three to six months to conduct that work then go back to me with FDA and make sure. There is alignment on all of the potential interim or accelerated endpoints the full end points and.
Bradley Campbell: Yeah, I'll start the second one. I will say that's one, maybe the one bright spot in all the craziness out there, as you are hearing from senior officials, including the new FDA director, a nod towards rare disease drug development. We would love to see more use of real world evidence. We'd love to see an acknowledgement that in rare diseases, you can't always have a placebo control arm in a rare, fatal disease. We would love to see some other incentives that would, I think, appropriately recognize some of the modernization of regulatory ability and clinical trial design.
Jeff: Then conduct that interim analysis. So I think nine months as you said it could be in that ballpark really after we get through this three to six months, we can start to get more timing specifically about the next step the interaction and when the interim might occur.
Jeff: Great. Thanks, Jeff.
Jeff: Okay.
Jeff: Thank you.
Speaker Change: Our next question comes from the line of Dennis <unk> of Jefferies. Your line is now open.
Jeff Castelli: So, I think there is maybe a silver lining there, which we look forward to continuing to see that play out.
Speaker Change: Hi, Good morning, Thanks for taking my question I had one on <unk>, specifically on the CCR two mechanism.
Jeff Castelli: And then maybe, Jeff, quickly take the second one, any of the, at least maybe one of the indications we're thinking about. Yeah. So, I mean, with the mechanism of action and it being very kidney specific, you know, just looking across rare kidney diseases where monocyte macrophage inflammation seems to be playing a key part and it's not well addressed, I think there's a number of potential interesting areas, you know, diabetic nephropathy and IgA nephropathy have been looked at. I think there's a lot of potential players in those spaces. You know, there are ones like proliferative lupus nephritis that also looks like this could be a key mechanism to address.
Speaker Change: I appreciate that the Americas had already had positive phase II phase III interim, but chemo Suntrust failed phase two a few years ago and Thats just yesterday with the same mechanism can.
Speaker Change: Can you comment on what happened there if there was a drug target our trial design issue and.
Speaker Change: How may be trying to treat differently.
Speaker Change: At this time, yes.
Speaker Change: It's a great question I think it's important that Jeff highlighted although maybe Jeff you can provide just a little bit more color there.
Speaker Change: This molecule <unk> 200 is a differentiated CCR two molecule inhibitor molecule and so.
Speaker Change: I think it's very important to highlight those differences and so Jeff maybe share a little bit more of that color specifically, how it acts within the kidney.
Jeff Castelli: So, I think we're looking at sort of a number of different areas and saying, you know, where is really mechanistically the best fit and then what also sort of fits in terms of building off of our FSGS kind of learnings clinically as well as those positions that we'll call on. So, I think there's a few really good candidates there that we're going to start to dig into. And there already is proof of concept data for some of those with the general pathway of CCR2 being involved. And I think that's where, again, that turning profitable in the back half of this year, and then, obviously, that leads eventually to positive free cash flows, that gives us our own capabilities and resources to start to expand the portfolio, even within the products that we have.
Jeff Castelli: Yes. Thanks, that's a great question. So there've been CCR two inhibitors historically that had been tried by several companies in different diseases, mostly to try to knockdown monocyte driven inflammation. The difference with <unk> 200 is it's not a direct inhibitor of the binding of the MCP, one which is sort of the.
Jeff Castelli: Signal to the CCR two receptor instead, DMX 200, specifically acts downstream and blocks the signaling coming out of the <unk> <unk> that's on damaged kidney tissue that acts as the amplification for inflammation. So what happened with traditional binding inhibitors as MCP one.
Bradley Campbell: And now with DMX-200, that should give us some opportunity there. Great, thank you. Thank you. All right, thank you.
Jeff Castelli: Doc and that actually led to a rebound the secular MCP one levels dramatically increase which then would compete with the inhibitor and kind of lead to a meeting of effect. So the beauty of the downstream blocking as that MCP. One can still doc that leads to actually MCP. One degradation. The signal has stopped so we're actually seeing MCP one levels come down with DNS.
Operator: So that was the last question for today. So this does conclude today's conference call, and I do hope everyone has a great day. Thank you. Thanks very much. Thanks, everybody, for tuning in.
Jeff Castelli: 200 versus increase which is really sort of the benefit of having that downstream targeting we think that will really maximize the ability to shut down the monocyte inflammation and the other great thing about that is it allows modest rates to continue their job elsewhere, because we're not directly blocking the MCP one binding to modestly to monocyte. So they can still fight infections as they should.
Jeff Castelli: Outside of the kidney.
Great. That's very helpful. Thank you.
Jeff Castelli: Thank you for the question.
Jeff Castelli: Alright, thank you.
Speaker Change: So our next question comes from the line of <unk> Ahmad of Bank of America Securities. Your line is now open.
Speaker Change: Hi, Good morning. This is sounds like Athene. Thank you for taking our questions.
Speaker Change: That does <unk> rebate drag that's a onetime thing for I wonder.
Speaker Change: Can you clarify on that can you make sure that this is not a recurring event. Our second question is how do you plan to message the progression of pump up versus expectation.
Speaker Change: In the 10 countries that you're planning to launch and what have you been hiring so far from the payers and providers.
Speaker Change: And our first question.
Speaker Change: Can you elaborate whether thats.
Speaker Change: This deal represents the beginning of Nevada plant into technology, where inflammation related.
Speaker Change: Thank you.
Speaker Change: Yes. So I think the first question was around Deepak just to be clear, we had anticipated based on the guidance from the industry Association up to a 15% rebate and what was provided in fact was or what was what was decided and given to US was a 22% rebate to be.
Speaker Change: Clear that will impact revenue over the course of the year and Thats part of why with Palm op, we've adjusted our guidance downwards.
Speaker Change: With <unk> because again.
Speaker Change: The strong patient growth, we believe we will be able to make up for that over the course of the year, which is great.
Speaker Change: APAC is something that we've always had.
Speaker Change: In our estimation part of the arrangement between industry in the U K government and so on.
Speaker Change: As part of our expectations and guidance. It just very unusual to have this kind of significant increase in the.
Speaker Change: Eventual rate versus what they guide us to hope that provide some clarity as it relates to positioning we've done an amazing job of working through the reimbursement process in Europe. We were the first ever product get approval by nice ahead of NHRA approval, we got first position in Sweden first position in the Netherlands.
Speaker Change: We had a very fast launch and reimbursement process in Spain. So we're very clearly demonstrating the value proposition of the product and the positioning from a competitive perspective of course is all about the data and again the differentiated data we've shown in terms of the only product in a controlled study showing that we can improve patients who switch from enzyme replacement therapy.
Speaker Change: And I think those are the data that are continuing to drive adoption of the product. So hopefully that gives you a flavor. There maybe just a quick reminder of the.
Speaker Change: The strategy around.
Speaker Change: How we thought of this product and then what we think going forward.
Speaker Change: From a BD perspective or portfolio perspective.
Brian: Yes, Brian so.
Brian: We did highlight in the past the arrears of interest from some points I think.
Brian: We we have shared that.
Brian: We tend to think.
Brian: For a framework in adjusting fees to our existing businesses. So looking at neuromuscular and <unk> assets more broadly speaking.
Brian: Rare metabolic disease.
Brian: Generally speaking so these are clearly the areas of interest.
Brian: This particular deal here is for U S rights.
Speaker Change: Yes, as well as in other indications by the way.
Brian: Even our excitement around the MAA.
Brian: And so we think that there is clearly an opportunity to expand in the rare kidney space with that specific assets in the U S. So eager.
Brian: Two.
Brian: To expand our portfolio on a global scale.
Brian: So interested to also leverage our capabilities.
Brian: Ex U S.
Brian: Great. Thank you.
Brian: And thanks for the question.
Brian: Thank you.
Speaker Change: So our next question comes from the line of Kristen clue, Scott of Cantor Fitzgerald your lifestyle.
Speaker Change: Hey, guys. This is Rick Miller on for Chris. Thanks for taking our question just one on one on <unk> here, you talked about there potentially being kind of subsets of patients maybe some that respond better from a hemodynamic driven mechanism versus inflammatory driven in.
Speaker Change: SGS.
Speaker Change: To kind of get at this is there any stat around what percentage of <unk> patients seem to be poor responders on arbs or how should we be thinking about that.
Jeff Castelli: Yes, just as a reminder, Jeff I'll turn it over to you from a technical perspective as a reminder, there are over 40000 patients with F. S Geos or primary FX GFS at least in the United States and we think a fairly sizable subset of those patients would be prime candidates for this product.
Speaker Change: But Jeff maybe talk a little bit about sort of how we see it as kind of.
Jeff Castelli: Most obvious most likely to be responders and then some of the other opportunities as well.
Jeff Castelli: Yes, it's a great question and so the focus of the patients for <unk> 200 in the trial are primary <unk>, which is sort of originally triggered by a T cell.
Jeff Castelli: Insults then caused this feedback loop and then also genetic which is mainly driven by the April one patients. So in that group what we're targeting there are patients. Despite <unk>, despite corticosteroids still have partner, which.
Jeff Castelli: Which is greater than one five gram per gram that are in the trial. Unfortunately, that's actually a majority of FSD is patients that still despite those treatments still have significantly elevated protein area and in those patients.
Jeff Castelli: In particular, the higher the proteinuria levels, it's more and more likely that they have an uncontrolled inflammatory component going on so theres not great numbers about how many patients in that group have significantly elevated MCP. One for example, but through some of the work that the Americas is done, but we'll continue to learn through the phase III, we think that is a significant.
Jeff Castelli: <unk> of those patients and those are the ones in particular, where we expect to see potentially a very robust response in terms of reduction in proteinuria.
Jeff Castelli: Also and others that might not be as elevated that are in the trial or out there that might be treated on the line.
Jeff Castelli: Inflammation does start to kick up in these patients. So you might actually prevent kind of a worsening in addition to actually driving some improvement in particular in those that are sort of have major ongoing inflammatory components, but I think we're going to learn more and more with FSD is that theres a lot of different mechanisms going on I think we're going to start to really start to refine the different msas that are better for <unk>.
Jeff Castelli: The types of patients, but we're super excited that we think the Nx 200 is going to address a significant percentage of those patients where it's really that inflammation, that's driving things.
Speaker Change: Thank you.
Jeff Castelli: Thanks, guys.
Operator: So our next question comes from the line of Gil Blum of <unk> <unk> Company. Your line is now open.
Speaker Change: Good morning, everyone and thanks for taking our question just maybe a couple of macro items. So you mentioned very limited impact of tariffs in 2025.
Speaker Change: Going into the future is there going to be additional investment required in order to control potential for tariff hike back in later years.
Speaker Change: What is the impact of the weakening dollar thank you.
Speaker Change: Yes, thanks, Gil on the manufacturing side of things.
Speaker Change: I don't foresee significant additional investments to be made to navigate around the tariffs you might remember that we've already are well underway and moving the majority of our manufacturing to Ireland and that will I think help diversify and de risk the manufacturing both cost and geopolitical location.
And then Sebastian and I mentioned on the call we're moving some of the.
Speaker Change: The drug product manufacturing here in United States, which again further diversifies.
Speaker Change: So I think we feel very good about our ability to manage that going forward.
Speaker Change: Despite the uncertainty that's out there.
Speaker Change: As it relates to the second one just as a reminder.
Speaker Change: A significant portion of our revenue comes from the pound the euro and the yen and so a weak dollar for us generally gives us some FX benefit.
Speaker Change: However, we've tried to I think show and some of our slides just as an example of what changes in the value of the dollar could impact our revenue and that's also why we focus on growth from a constant exchange rate perspective, but hopefully that gives you some flavor of.
Speaker Change: In our case the weakening dollar tends to help on the top line based on the majority of revenues coming outside the United States.
Speaker Change: Thank you.
Speaker Change: Okay.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of <unk> Richter of Goldman Sachs. Your line is now open.
Speaker Change: Hi, This is <unk>. Thank you for taking my question.
Speaker Change: So regarding farm up did you maybe get some more color on the competitive dynamics in the U S.
Speaker Change: A good portion of patients coming into that.
Speaker Change: Propane window for switching and basically how are physicians at this point deciding between the two products and what sort of market feedback have you been getting.
Speaker Change: Yes, great questions.
Speaker Change: One thing we would note actually and this is just public information the global franchise.
Speaker Change: For Santa Fe in Pompeii actually declined by 5% in the first quarter. So I think that shows that for the first time, we are starting to meaningfully.
Speaker Change: In.
Speaker Change: Take share and in pack their growth and so you can see our 90% growth obviously in Stark contrast with that.
Speaker Change: In terms of positioning I think it continues to be what we've shared which is immuno.
Speaker Change: In the United States in particular, once physician startup patient lives and that was the only choice. They had because we werent on the market yet they want to give about two years of time before they are ready to to switch again, and so having just big numbers of <unk> patients coming into that switch period is helpful. And I think if you look at the acceleration that Sebastian talked.
Yeah.
Speaker Change: And the proportion of patients coming majority from <unk> that continues to say that we will and are switching those patients. Most importantly, what theyre looking at is declining in both six minute walk and forced vital capacity, but also some other patient reported outcomes and that's where the data that Jeff mentioned the growing body of evidence looking at long term impact not just on.
Speaker Change: Those two endpoints, but also <unk>, but then also these case studies and showing improvement.
Speaker Change: From a showing the support for the switch from <unk> Palma I think is really important. So those are the things that we think are going to continue to drive the switch and support that acceleration over the course of the year.
Speaker Change: Yeah.
Speaker Change: Thank you.
Speaker Change: Alright. Thank you. So our last question comes from the line of Maxwell score of Morgan Stanley. Your line is now.
Maxwell Score: Great. Thank you for taking my questions could you elaborate a bit more on other potential indications amendable to <unk> two hundreds MLA and also given the evolving regulatory landscape could you share any insights or potential changes you might like to see at the agency to improve rare disease drug development or review.
Speaker Change: <unk> efficiencies. Thank you.
Speaker Change: Yes, I will start the second one I will say, that's maybe the one bright spot in all the craziness out there as you are hearing from senior officials, including the new FDA director of nod towards rare disease drug development, we would love to see.
Speaker Change: More more use of real world evidence, we'd love to see.
Speaker Change: An acknowledgment that in rare diseases, you cant always have a placebo control arm.
Speaker Change: Rare fatal.
Speaker Change: <unk> disease.
Speaker Change: We would love to see some other incentives that would I think appropriately recognize some of the modernization of regulatory.
Speaker Change: Ability and clinical trial design. So I think there is maybe a silver lining there, which we look forward to continuing to see that play out.
And then maybe Jeff quickly take the second one any any of the at least maybe one of the indications we're thinking about.
Speaker Change: Yeah, So I mean with the mechanism of action and its been being very kidney specific just looking across rare kidney diseases.
Speaker Change: We're monocyte macrophage inflammation seems to be playing a key part and it is not well addressed I think theres a number of potential interesting area. As you know diabetic nephropathy Iga nephropathy had been looked at I think there's a lot of potential.
Speaker Change: Players in those spaces, there are ones like proliferative lupus nephritis that also looks like this could be a key mechanism to address.
Speaker Change: So I think we're looking at sort of number of different areas and saying where is really mechanistically. The best fit and then would also sort of fits in terms of building off of our <unk> kind of learnings clinically as well as those positions that will call on so I think theres a few really good candidates there that we were going to.
Speaker Change: To dig into.
Speaker Change: There already is proof of concept data for some of those.
Speaker Change: With the general pathway of CCR to being involved.
Speaker Change: And I think Thats, where again that at.
Speaker Change: Turning profitable in the back half of this year and then obviously that leads eventually to positive free cash flows that gives us our own capabilities and resources to start to expand the portfolio even within the products that we have announced the Max 200 that that should give us some opportunity there as well.
Speaker Change: Great. Thank you.
Speaker Change: Thank you.
Speaker Change: Alright, thank you.
Speaker Change: So that was the last question for today. So this does conclude today's conference call and I do hope everyone has a great day. Thank you.
Speaker Change: Thanks, very much thanks, everybody for tuning in.