Q2 2025 Insmed Inc Earnings Call

Hello, and thank you for standing by. My name is Tiffany and I will be your conference operator today.

At this time, I would like to welcome everyone to the Insmed Q2 2025 financial results conference call.

All lines have been placed on mute to prevent any background noise. After the speakers are marked, there will be a question and answer session. If you would like to ask a question during that time, simply press star and the number 1 on your telephone keypad. I would now like to turn the call over to Brian Dunn head of investor relations. Brian please go ahead.

Thank you, Tiffany.

Good day, everyone and welcome to today's conference call in which we will discuss insmed, second quarter, 2025, Financial results and provide an update on our business.

Before we start, please note that today's call will include forward-looking statements based on our current expectations. These statements represent our judgment as of today and inherently involve risk and uncertainties that may cause actual results to differ materially from the projections discussed, please refer to our filings with the Securities and Exchange Commission for more information.

The information we will discuss on today's call is meant for the benefit of the investment Community. It is not intended for promotional purposes and it is not sufficient for prescribing decisions.

Today's call Will feature prepared, comments by Will Lewis chair and chief executive officer. Roger adset Chief Operating Officer and Sarah bonstein, Chief Financial Officer

After their comments, they will be joined by Martina Flammer, Chief Medical Officer, for the Q&A session. I will now turn the call over to Will.

Thank you, Brian. And welcome everyone.

As I reflect on the first half of 2025, I am enormously pleased with where Enid stands as a company and the potential impact we can have on the lives of the patients. We serve

insmed is now 3 for 3. All 3 of our late stage assets. Arikayce Brena cab and TP appear to be clear winners with positive Phase 2 or phase 3. Clinical data. Having been produced by each which is an extraordinary achievement for any company in this industry.

These successes have been made possible by the work we put in over the last 18 months across every aspect of our business including commercial execution. Pre-commercial launch Readiness regulatory interactions clinical development activities, early stage research, and enabling functions I could not be prouder of our teams of dedicated colleagues at insmed.

As a result of this impressive operational performance and our solid financial position flowing both from the performance of our case and our recent Capital RS. We feel insmed is an an incredible position of strength

I want to emphasize that this is just the beginning.

The next 12 months for Insmed are shaping up to be extraordinarily impactful.

We expect a steady Cadence of meaningful events, both commercial and clinically that have the potential to significantly expand the company's impact on patients and establish inmed. Next wave of products and indications, that will drive future growth. If successful, these catalysts could enable us to address more than 2 million patients with serious diseases, across, multiple products, and indications, in the coming years.

To summarize, the progress instrument is made and highlight what still lies ahead. I'd like to divide our discussion into 2 sections. Our late stage portfolio and our early stage portfolio.

Our late stage portfolio is made up of errors, brento and TP.

Error case continues to perform in its current indication demonstrating consistent year-over-year growth. In its seventh year of launch.

We believe We are on track to achieve our full year 2025 sales, guidance driven by continued growth in the US, Europe and Japan.

Performance today has been particularly impressive. Given that our Us sales team has been simultaneously. Conducting disease State, education on bronchitis.

And the first half of 2026, we anticipate the clinical readout of the phase 3 Encore study in patients, with newly diagnosed or recurrent Mac lung disease, who have not started antibiotics.

25,000 additional patients could gain access to error, case, driving, another leg of growth for the franchise.

Moving out of brensocatib, we are days away from potentially launching. The first indication for brento Academy in the US representing 1 of the most anticipated launches in our industry this year.

Launches, for brento cabin non-cystic fibrosis. Bronchitis in Europe, the UK and Japan are expected in 2026. We also expect Topline data from our Birch study of brento in patients with CRS without nasal polyps by the end of 2025 and the interim futility analysis, for our seeder study of brento and patients with Hydra suppurativa in the first quarter of 2026.

As we've indicated before, if successful, these studies could unlock a massive opportunity for brento to potentially serve other large patient. Populations with very few treatment options

Lastly TP we have now produced positive results for TP. In 2 Phase 2 studies. We anticipate entering phase 3 for pH ild in 2025 and for paw in early 2026. We Believe TP has the potential to become the prostanoid of choice for the treatment of paw and phild pending positive results in these phase 3 programs.

Turning now to our early-stage portfolio,

This portfolio is made up of our gene therapy operation in San Diego. Our demonized therapeutic protein operation in New Hampshire. Our synthetic rescue research efforts in Cambridge England and our research work happening in our original Labs based in New Jersey, across all 4 of these operations, we have more than 30 pre-clinical programs in active development,

We have historically highlighted that our preclinical research efforts are expected to stabilize. 20% of our overall, spend with a goal of producing 1 to 2. New Endz, a year on average to that end the last several years have produced significant progress.

Our San Diego research site, which was acquired 4 years ago, has published encouraging pre-clinical data, in DMD, ALS and stargardt disease. With the latter representing the first application of our proprietary RNA and joining technology.

This research site recently initiated its first phase 1 study in patients with DMD with additional ind's expected in the coming years.

Our New Hampshire research site which has been part of insmed since early. 2021 has produced exciting progress as well with its AI based protein demuniz platform demonstrating promising, results in pre-clinical models, setting up the possibility for demonized proteins to potentially address a variety of conditions initially looking at uricase and IGG. Proteus.

Our Cambridge England site, which we acquired in 2023 continues to make steady progress on identifying targets. For its synthetic rescue platform to potentially be employed against some of the world's most difficult to treat diseases such as a taxi Hotel, injects you.

More recently, they have also Advanced a potential treatment in ALS using a different approach from The Sod 1 gene therapy being developed by our San Diego team.

Finally, our original New Jersey based research. Site continues to be a hub of innovation. For instance, not only were erase and TP produced from these Labs. But they have also screened approximately 850 potential, Next Generation, dpp1 Inhibitors and are currently conducting pre-ind work. For the first of these molecules that we hope will enter the clinic next year.

Consistent with inmate's core values, a spirit of collaboration and mutual support exists between these sites. They are overseen by a research Council which is comprised of 2 representatives from each location. The council and select members. From each of these research sites Gather in person twice each year to provide progress updates, offer input, and explore ways to collaborate to potentially accelerate the development process.

well, there's a lot going on in our early research engine, we will only provide regular updates on the programs that have cleared the IND, heardle,

In general, we continue to see meaningful progress across each of our early stage research platforms and our excited for what is to come.

As 1 example of the progress being made last month. Our first patient with DMD was dosed with ins 1201. Our investigational intrathecally delivered gene therapy as part of our Phase 1 Ascend study.

Moreover, we anticipate multiple ends coming from our early stage research engine over the next year.

Including our Gene therapies for ALS and stargardt disease, as well as our next generation of dpp1 inhibitors.

Of bringing first and best-in-class therapies to patients facing serious diseases.

With this architecture in mind it is my hope that you can appreciate insmed, significant progress. While visualizing the exciting future ahead for both our late stage and early stage portfolios.

Let's now take a few moments to walk through some updates from our late stage programs starting with brensocatib.

The US launch of brenso Academy in bronchi Actis. Is arguably the most important Catalyst for us to get right in the near term.

I'm pleased to report that we have submitted, our agreement to the FDA about our label. And from our perspective, we remain on track for a decision on or before the Padua Target action date next week.

Given how close we are to launch. I've asked Roger our chief operating officer and former Chief commercial officer to share some of his own thoughts on how our launch preparations compared to those, he has seen throughout his distinguished career. Let me now turn it over to Roger.

Thank you. Will good morning, everyone. It's a pleasure to be with you this morning.

As I reflect on the resources invested in the preparation for brento, cad's us launched its apparent to me that the team is well positioned to execute on this opportunity.

A few things in particular, stick out to me.

First, I've never seen a company prepare its customer-facing organization so far in advance of the launch.

As we've shared previously, we had our sales force fully built out trained and in the field more than 10 months ahead of time.

Many companies wait until approval to deploy these resources or elect to do, so only a handful of months in advance.

Our proactive decision to expand our commercial organization in this way. Is 1, that, I believe, will result in more patients gaining access to this important therapy and more Physicians feeling prepared to prescribe it,

Second, I often see companies Overlook the importance of developing resources that support the experience of patients and prescribers.

If attaining access proves 2 burdensome for patients or Physicians offices to navigate providers, May hesitate to prescribe and patients may fail to fill their Scripts.

It's for this reason that ends in Med significantly built out its patient support function called enlightened which is fully deployed and ready to assist patients and Physicians to navigate the complexities of the Health Care system from day 1.

Additionally, while it's common for companies to conduct Outreach with payers ahead of new product, launches pay your feedback. In our early discussions, about brento khattab has been particularly supportive of our approach.

The importance of patient access can at times be underestimated in determining a launch of success.

Particularly when a product is entering a market with no clear competition.

I'm pleased that our team has taken nothing for granted on that front.

Our prioritization of patient access acknowledges, this critical aspect of launches and fully aligns with that. Patient focused culture.

Finally, I want to mention our current understanding of physician enthusiasm handed in headed into this launch.

Based on our interaction, interactions with key opinion leaders, and our extensive survey work, it is clear to us that physicians have a very high intent to prescribe Brenzo CIB to appropriate patients.

And while we know that surveyed Physicians often assume they will write more scripts than they actually will in practice the fact that 90% of surveyed Physicians indicate that they indicate to prescribe intensive, prescribe it to their patients with 2 or more pulmonary exacerbations over the last 12 months is extremely encouraging.

Now, as with every launch, not everything will go to plan.

And while there's no way to fully anticipate what challenges may arise, I see our Brenzo Khattab team is being prepared to respond to whatever may come.

They're equipped with a culture in which raising your hand at the first sign of a problem is championed and they are Nimble enough to make necessary adjustments quickly.

I also want to remind you that even the best of launches can take weeks from approval to get medicines into the hands of patients.

This is primarily due to the time. It takes to print final labels and packaging guide. The product through distribution channels and navigate patient access.

As a result for benzo katib, you should continue to expect only a few weeks of sales for the third quarter, assuming approval by our producer date next week.

Having said that, let me emphasize again that everything I've seen from this team's preparation and brenzo cabs unique profile, leads me to believe that this medicine has the potential to have 1 of the best launches in the specialty, respiratory space.

Now, let me turn it back to—well, thanks for sharing those insights, Roger.

I want to stay with Bren soad but move it move to its second potential indication CRS without nasal polyps.

As we mentioned on our last call, the Phase 2 Birch study was fully enrolled in April and continues to steadily advance towards its completion.

to review, blinded safety information, the committee found, no safety signals and unanimously recommended that the study continued unmodified

This represents the best possible outcome from this meeting.

Recall that the Birch trial is testing 10 and 40 milligram doses of Bren soad, which is different from the 1025 milligram doses that were studied in our bronchitis trials. So it is reassuring that there are no safety signals that have emerged even at a higher dose.

While we continue to expect the data from the Birch trial to become available before the end of the year. The exact timing of the Topline rate out is still being determined. Given our usual practice of taking whatever. Time is necessary to ensure the data are cleaned to submission level quality, we remain eager to see those data and look forward to what those results. Could mean for patients,

Our Phase 2, Cedar study and patients with Hydra adenitis suppurativa is also progressing nicely with more than 50% of the target enrollment completed.

Given the strong enrollment to date. We now expect to be in a position to share the outcome of the interim futility analysis of the first 100 patients in the first quarter of next year.

These 2 follow-on programs for brento Academy, hold the potential to establish dpp1 inhibition as a mechanism that can offer benefits to patients across multiple neutrofil mediated diseases.

Success in either of these indications would add to our confidence both in brensocatib and in the likelihood that our next Generation dpp1 molecules could also serve patients with a variety of other conditions.

turning now to our tip program,

The clinical highlight of the intimate second quarter was the topline data released from our Phase 2B trial of TP in patients with pulmonary arterial hypertension. The results exceeded even our most optimistic expectations and established, in our view, the potential for TPI to become the processor of choice in the treatment of PAH.

To recap those results, the 35% Placebo adjusted reduction in PVR represented, the largest treatment effect ever shown in a well-controlled trial of which we are aware.

Additionally, the 35.5 meter Placebo adjusted Improvement in 6-minute, walk distance, produced, A P value. Well below 0.05, which despite not being adjusted for multiplicity was especially striking because the trial was not powered to show a statistical outcome on this measure.

Even more impressive was the fact that these end points were measured approximately 24 hours after the latest dose demonstrating the sustained clinical benefit of the treatment over a 24-hour time frame.

With these data are focused. Now turns to our phase 3 ambitions, we've made significant strides on that front and are on track to kick off the phase 3 and pH LD and the second half of this year.

The work we have done to update the capsule strengths, so that doses up to 600 micrograms can be delivered in a single capsule, is now complete. We have engaged with regulators on our plans for trial design, which will allow for dosing up to a maximum of 1,280 micrograms.

With a look forward to sharing the details of the PHD face free trial design later this year.

In addition, our program and PAW are also advancing on schedule with our final clinical study report of the Phase 2 trial. Now complete, we can approach the agency for a meeting to discuss those results and align on a Phase 3 trial design that will meet the regulators' expectations for approval. We expect that meeting to take place in October, setting up the potential phase restart in early 2026.

Let me conclude my remarks by saying that insmed is ready. We have been preparing for years to execute on the enormous, clinical and Commercial opportunities that lie ahead of us over the next 12 months. If we achieve this, we hope to produce a real and profound difference in the lives of patients living with serious diseases while also, potentially creating value for those who have supported us in our Evolution to this position.

Central to our ability to achieve these Ambitions is a culture that supports and empowers our people to do their best work. That is why I'm so proud that insmed was recently. Certified as a great place to work for the fifth year in a row. This is an incredible honor and it is reflective of how our employees feel about working at insmed.

Our people are responsible for all of our successes to date and similarly, are people will be the ones who will determine our future. This recognition serves as external, validation of what I see internally every day that the special culture, we have built at insmet is being preserved, even as our team, expands as a company, we have never been stronger or more motivated to deliver on our mission. I'll now turn the call over to Sarah.

Thank you will and good morning everyone.

Let me begin. My discussion of second quarter 2025 results by highlighting the strong commercial performance, of error case, which is Illustrated here on slide 16

Double digit year-over-year Revenue, growth globally.

These impressive results were driven by the highest quarterly Revenue figure ever achieved in the United States along with yet another quarter of extremely impressive performances in both Japan and Europe, all of which was driven by strong volume trends.

In Japan, the 45% growth, this quarter resulted from the implementation of new targeting strategies and initiatives to improve the patient experience.

For Europe. The 48% growth was driven, primarily by strong demand in Germany, Switzerland and Austria.

Due to the strength of this performance. We remain on track to achieve our 2025 full year error, case net revenue, guidance of 405 to 425 million

As a reminder, this guidance range is specific to erase only and does not include any future Revenue contributions from brento ka-tip if approved.

On slide 17, you can see our updated cash balance. As of the end of the quarter,

This reflects the equity offering that was completed in the second quarter and includes the exercise in full of the underwriters' option to purchase additional shares, which in total results in the sale of approximately 9 million shares of our common stock at $96 per share, resulting in approximately $823 million in net proceeds to the company.

Company at approximately 1.9 billion dollars in cash cash equivalents and marketable securities. As of the end of the quarter we believe we are extremely well capitalized.

Excluding option exercises and proceeds from our recent Equity, offering our underlying cash burn. For the quarter was consistent with the underlying burn levels that we have seen for the past several quarters, which is remarkable given the additional Investments we've made in launch preparations over that period.

Although we don't guide to cash burn levels in general, we expect our burn will begin to decrease in the coming quarters as the expected Revenue growth from brento. Cib's us launch has the potential to more than offset. The expected increases in spending.

Moving to slide 18, you can see our operating expenses for the quarter.

cost of product revenues in the second quarter of 2025 was 28.1 million or 26.1% of revenues, which is slightly higher on a percentage basis than our historical performance and reflects the higher proportionate of revenues, which came from outside the US, this quarter,

Additionally, research and development in SG&A expenses increased this quarter compared to the prior year period. This increase was primarily driven by investment supporting our commercial readiness initiatives ahead of the expected U.S. launch of Brento Cath enhancements in our international commercial operations and continued funding across our early and late-stage pipelines.

In closing, I want to comment briefly on where we are positioned financially as a company and what still lies ahead.

We have had a remarkable run of clinical successes over the past 18 months that has transformed insmed and given us 1 of the most exciting portfolios of commercial and late States Assets in all of Biotech.

Over the next 12 months, we anticipate up to 10 additional commercial clinical development and regulatory milestones, which we believe have the potential to create incremental value.

With our recent Equity financing, we believe we are well positioned to lean in and deliver on each of those catalysts.

while we never give guidance on on our expected cash, Runway or timing for achieving profitability, for purposes of maintaining Financial flexibility

I can say without hesitation that insmed is in the best financial position in its history.

We remain committed to thoughtfully and leading our Capital to maximize the opportunities ahead of us on behalf of patients. We would now like to open the call to questions. Operator, may we take the first question, please.

At this time, if you would like to ask a question, press star, then the number 1 on your telephone keypad to withdraw your question, simply press star 1. Again we kindly ask that you limit yourself to 1 question and return to the queue for any follow-ups. We will pause for just a moment to compile the Q&A roster.

Your first question comes from the line of Jason zamansky with Bank of America. Please go ahead.

Conversations with investors of late. There have been some questions over the patient Journey given that uh, uh, ncfb and brenos is a new indication. So, ahead of next week, I was hoping you could provide some color into what you're doing on a practical level to capture patients. Obviously interest from the stakeholders are are a huge positive, but what are some of the mechanics you're doing to to practically move a patient onto treatment? Um, you know, what are some of the Key Systems you put in place and and ultimately what gives you confidence that team can succeed. Again, giving the challenges that this is essentially a new market that you're building on your own. Thanks.

Yeah, I appreciate the question. I think the first thing to remember, is that we've been here before, we did this same exact roll out with Eric case, as the first ever approved, uh, product for the treatment of refractory Mac lung disease.

And um, and I just remind everybody because it's a point we like to, to remember and, and try to learn from and also celebrate, when we first came out with erase, I think, the average estimate for Revenue was 40 to 60 million in the first year and we ended up doing, I think a little over 130.

So um, triple what, what most people thought we were going to be able to accomplish and I think there's always a reticence uh that you know, taking on a new indication uh requires more effort more work and is more uncertain but that's why we started as early as we did and that's why we got our teams out into the field as Roger mentioned. Um, starting in October, 1 of last year. So the first answer to your question, practically is to get people out into the field to do.

Disease State awareness.

And to build the relationships that enable Physicians to reflect on. If there is a new medicine that is approved. They know the patient profile that would respond and they can have already thought about that. And so I think, you know, we've heard from Kos and and actually Community level Physicians that many of them have, if you will a list of patients that they want to turn to that they think are suitable for this right out of the gate that information conforms to what we had seen in our research. When we went out and sort of size this Market initially, which we've told you is roughly in the US about 500,000 patients that are diagnosed today with Broncos. Um, and have an ICD 10 code and all the rest of that roughly half, we think have had 2 or more exacerbations in the last 12 months.

Um, down to the physician level, we have now profiled every physician um, in the United States and we have information on uh their expected uh, patient numbers if you will. So I think we have a very good idea of where all these patients are and how to go about uh gaining access to them. And we've been putting that in place since we kicked off our disease, State awareness campaign, literally 2 years ago at ATS. Um you know more practically is the patients come in, whether the physician calls them over the phone or needs to see them in person. Either way, once that script, uh, recommendation, and and writing takes place, there's an entire front end of the funnel. That will grab the patient and make it available to them to join the

The enlightened program that Roger made reference to which is a patient support program that will help guide them through that Pro process in a compliant and appropriate way. Um you know, and then there's also all the efforts that the specialty pharmacies uh, will be prepared to make. We have at a, uh, tactical level across, um, the engagement with patients and Physicians and the Physicians offices in a very compliant way. Um, support systems available to ensure that this process is what we refer to as a frictionless launch and it's our hope that we'll be able to deliver on that. So I, I hope that gives you a little bit more insight. But I would say, out of the gate, we feel um, cautiously optimistic that we are ready to, um, engage with this opportunity.

And just 1 other piece. I would just, uh, highlight, Jason, is the creation of the COPD foundation and then creating the 150, uh, Care Center networks around the United States. And, as of last, you know, the first cohort, I believe there was about 33, um, sites identified to be centers of excellence, for both NTM and bronchi activists, and sort of the next wave is going to be happening and be put into place um very soon. So I think that is also another very tangible piece that's going to help on the patient Journey side.

Got it. So, there is optimism. You can, uh, capture these additional asthma and COPD patients as well.

Get the answer to that question, so we're encouraging um, that reflection. So that Physicians when they think it's appropriate will follow that path and that would gain access to those patients, who are comorbid with COPD or asthma. Um, if those CT scans were to show definitively that they had bronchitis and had experienced 2 or more exacerbations in the last year, if that is the patient profile, then they would be, um, what we would expect to be on label. Uh, if things go, as we expect, they will next week. Um,

And I think that is a big opportunity, right? We've, we as I said before, 500,000 half of which are 2 or more exacerbations that are that are identified right now behind that, um, are multiples of that in size of potential patients. And we'll have to see how that unfolds we'll be, we'll be tracking that 1 very carefully.

Great, thanks for the caller.

Your next question comes from the line of reup or all. With TD Cohen, please go ahead.

Hi guys, thanks for taking the question. I, um, mine is a just a follow-up to the previous question. Um, will you you used an interesting, um, phrase when you talked about payer feedback? Um, you said that the feedback has been positive on the insmet approach to these patients? And it sounds like it is, you know, patients who have a CT diagnosis, who have um, documented 2 plus exacerbations? Are there other aspects to the that ends matter?

Approach or insmed profile um that you can elaborate on like for instance. Um do you have an idea at this point about what sort of Prior authorizations outside diagnosis or to exacerbations might be? But do you think there might be prescriber restrictions or like a other diagnostic requirements? Outside, CT to Define that appropriate population and can you also? Um, can you also tell us if you plan on, providing free drug with launch?

Sure. So I'm actually going to ask Roger to address those questions. Yeah, thanks for 2 for the question. I think, um, what we anticipate and we'll alluded to this as well. Was just the frictionless, uh, launched for brento. And so as we think about that, that is to make the the, uh, prior authorization process, as smooth as possible, as easy as possible, uh, for the Physicians and the offices, that that actually usually are the ones who, who, who process the paperwork and submit that. And so, as we engage with pay payers, we find, um, some very strong alignment on thinking about the patients who are, um, appropriate for using brenzo katib. And so those are the patients with a bronchi exercise diagnosis. Um, through a CT scan, our goal is to have an attestation from The Physician that that's the case that should be. And and I think that that's a very reasonable uh, position that, uh, that the payers are are are, um, are also, um, understanding as a reasonable position and then the the 2 or more exacerbations over the past 12 months because that's the, the, the, the patient population

That we studied is in our clinical trials. Um, and so if we also think that that's an appropriate, um, uh, patient population, so there's a lot of alignment on that, um, and so I think that that part of the, uh, part of the alignment is just this is a first in disease, um, uh, product and and something that, uh, that some excitement about, um, having a solution for these patients that are continuing to exacerbate. Um, and so it's about aligning on the prior authorization and getting that criteria as smooth as possible.

And then the second question was around free product, I think it was. And so, uh, so we aren't planning to do any sampling, um, of, of brento at this time. Um, but we are, uh, making patient support available. Um, we're helping with uh, with co-pays for the commercial. Um uh patients Etc. Um and uh but but not, no, no direct sampling to to Physicians.

Great. Thank you.

Your next question comes from the line of Andrea Newkirk, with Goldman Sachs, please go ahead. Good morning. Thanks for taking the question. Um, and looking forward to next week. Um, maybe I could ask you here, um, with respect to tip. Um, if you look to a competitor, um, trial and ipf reading out next month. Um, how are you thinking about the potential for future profits and all to demonstrate an anti- fibrotic effect there? And what could that then imply for TP and if that study were to be positive, can you just speak to how quickly you can move to Advanced TPP into an ipf study? Could you move directly to a phase 3 or with some other dose finding work?

Need to be completed first. Thanks so much. Um sure I'm going to ask Martina to fill that.

Yeah, thanks for the question, Andrea. So with

Regards to the study.

You have stronger uh effects and so we would be in a uh in a position to start off a phase 3 study um in a very short notice but we all look forward to these results.

Your next question comes from the line of Jessica fee with JP Morgan. Please go ahead.

Hey guys, good morning. Thanks for taking my question. So we're just around the corner from Brent's launch and I wanted to revisit the analogs, you provided a few quarters ago. Where you looked at first in class, best-in-class, respiratory launches, I think at the time you said, those were analogs that any company would strive to even come close to. So, I'm just curious with all the preparation over the past year plus,

Can you speak to your confidence in breno achieving a ramp like that? Thank you.

Sure. So while we're not providing, formal guidance as to what we think, um, we'll end up doing, uh, I do. I do have an ambition that we will, you know, fall Within Reach of those ranges. That's certainly what I would expect to to hope to achieve. And the consequence of that would be, uh, what I think everyone would would observe as a successful launch. We've done a lot to get ready, but as somebody observed earlier, you know, this is a first in disease launch and so there's always going to be something that goes bump in the night and, um, and that may influence, you know, what, what we see in terms of performance, um, it's just impossible at this.

Stage to give any greater Clarity, uh, or know what the the future will hold.

Um, 1 of the things I did is a as a preparation or grounding exercise, is that I spoke to a lot of Chief commercial officers at other companies that have been involved in launches recently and almost to a person they uh, said that whatever their base case scenario was their ultimate result was wildly off. So it was either much higher or much lower and, uh, I can tell you where I hope we end up, but, uh, certainly we've done the preparation to accomplish that, but I think the key to that is making sure that we keep in mind, the patient experience from day 1. Um, we want the script to be written for the appropriate, patient, of course, and support all that. But we really want the patient pull through, um, because we know that the drug from the phase 3 trial and the phase 2 trial uh made patients feel better. And when we we saw that data, we were encouraged by that and we hope that that will be an experience that they have on the drug and that will reinforce um, the launch process and I think

Not insubstantial amount of uh the future performance of the drug will be determined by that experience. So we'll look forward to be watching that carefully. As just 1 example.

Um, and just 1 other thing just to remind folks of, um, as we saw with error case. And with all products, it takes a couple of weeks from approval to when you actually start booking Revenue. So, assuming August 12th to put you the date, it took about a month, um, from approval of error case to when we actually started booking Revenue. So, um, just reminder to be mindful of that during, um, projection.

Oh look, our ambition here. And our preparation is for this to be a strong launch and I'll be disappointed if we don't demonstrate that.

Your next question comes from.

Line of Joe Schwarz with Ling Partners. Please go ahead.

Great. Thanks very much for taking my question. Um, since your reads on Blended blinded data have been pretty accurate heading into past data sets, I wanted to ask. If you could expand on the qualitative statements you've made about the Birch trial showing positive signs, um, before you I'm blinded, is there anything in particular that you're seeing in that data? Which makes you optimistic? And then On a related note, um, can you talk about what factors are included in your statement that you expect to I'm blind Birch this year, but reporting the data is dependent on, um, taking whatever time is necessary. Uh, to achieve submission level quality, is there anything in particular, which could delay that readout?

Yeah, so let me take the second question first, there's nothing that we anticipate would delay. It just people often say, well, the trial, if you, if you're going to have the data by the end of the year, can we then expect it on date X and all we're trying to frame out here is that uh, they'll be the the generation of the Topline results but that process is longer than simply adding the final days. It can take a couple of weeks depending on what is going on and and what frankly is in the database. Um, but we don't know of anything right now, that we would suggest that there would be any kind of delay or impediment.

Confidence that we see positive outcomes here. We we don't you can't determine that from Blended blinded data and you always have to be cautious in looking at it. What we have seen in the Blended blinded data? Is that the pattern in that Blended blinded data would comport with what you would expect to see if the drug were working? That does not indicate that the drug is working. It just means that the profile of patients uh fits that. And so let me give you an example. If you're going to see a separation in treatment arms, you would expect to see concentrations of patients, you know, having certain response measures um, while we can't unblind the data to know who's in which arm we have seen distinctions between groups of patients, which would be consistent with different doses, providing different results and it's occurring at a time in the trial when you would expect that to happen. But once again, I want to emphasize not to over interpret these results, our confidence in this being effective in CRS without nasal polyps.

Comes from the fact that really that condition is almost 1. Can think of it like uh, bronkiektasis in the, in the nasal passage. And so, it's not dissimilar from bronchi ptosis in that regard. Now, that's a pretty rudimentary, um, biological description. But I think it is appropriate to combine those 2 pieces of information and at least say we are encouraged that this is directionally going the right way. Um, we'll have to see what the results show. And of course, we all know what the experience can be with clinical trial results.

So word of caution, um, but I would say we are cautiously optimistic.

Very helpful. Thank you.

Your next question comes from the line of Kelly shei with Jeffrey's please go ahead.

Uh, congrats on the progress, uh, for Brony access is launched. Do you think the eligible patients? Uh,

Uh, have activations properly recorded in the medical record for all and any physician feedback on this front? And, uh, maybe the strategy implemented in the future. Help and identify all the eligible patients. If not yet, thanks.

Sure. Yeah I mean when we size the market at launch at 250,000 roughly that is consistent with the data cross-examinations and and correlations that we've done looking at, you know, ICD 10 codes, surveying Physicians, doing market research. So we feel pretty good about that number as patients that have documented 2 or more exacerbations within the last 12 months. The unknown is the opportunity that lies beyond that and how proximate it is, how many of those patients that are out there that are perhaps comorbid with COPD or asthma and are tracking exacerbations, but have not yet. Had the CT scan to determine whether or not there is, bronchitis is present and that's the gold standard that's needed for those patients. So a lot of those patients I think are going to get channeled through a CT scan. Um, and I know, uh, there are some Physicians who are doing that in a very deliberate way.

Because they do believe that there are patients out there, perhaps, a way to ground this for everyone is to, uh, return to our Willow and Aspen Phase 2, and 3 study results where we had between 15 and 20% of patients. In those trials that were comorbid with COPD or asthma, and we saw response from those patients as well. That's what gives us confidence that if we can access that, um, undiagnosed or misdiagnosed patient population that, uh, that they'll not only, uh, be able to be identified as bronchitis, but will be responsive to the medication, which is, of course, the goal.

Thank you.

Your next question comes from the line of Craig. Savannah with Zhou. Please go ahead.

Uh, hey, good morning. Thank you for taking my question. Um, I wanted to ask about your interim, uh, futility analysis, um, that you're expecting next year in HS. And if you could remind us, uh, what the bar for Success will be in that interim, and then, uh, maybe a follow-up, as you think about next indications for Brands so katib, um, is the view, uh, that you will. Similarly, look to do interim, futility analysis. Thanks.

Sure. So, I think, uh, an response to the second question. Um, we don't anticipate taking breno into any additional indications Beyond bronchitis CRS without nasal polyps and HS. Um, but, uh, Martina, maybe you want to comment on on the first question, relating to the futility analysis. Yeah. So the, the planning of utility analysis based

Of efficacy that gives us the confidence that this is a good indication. And but you shouldn't be looking for a P value, but, um, a signal of efficacy. And the way that's going to work is we're going to they're going to actually unblind the data to an expert, third-party, uh, group of of Physicians, who will look at, uh, the data in an unblinded fashion to see if there's something going on there to your your, uh, earlier question. Really the intersection of the 2 questions, um, in HS, it's less obvious. And there are fewer uh, gold Center animal models that can inform whether or not any particular medicine is going to be effective. So we've gone into patients in Phase 2 but because of that caution and wanting to make sure we're deploying our Capital efficiently. We've done this utility analysis which won't hit the ultimate P value. It's not going to, we're not going to take an alpha hit on this by doing this because we won't see the results. It's only the expert panel and they're going to essentially give us a thumbs up or down the trial should continue or the trial should be stopped.

Um and that's the information we're going to get in the first quarter of next year. While we're not going after other indications with Brent socata but I do want to highlight that we will be entering the clinic next year with our next generation of dpp1 molecules. We've been working on since the willow results came out and we're so positive and those will unlock additional indications. We haven't decided what the first 1 is going to be yet, but we're looking very carefully at things like, COPD, like asthma, um, rheumatoid arthritis, and even IBD. So, um,

There's a lot where we can go with this class of molecule. Our confidence will grow with each additional indication, that is positive in terms of breno data. So, for example, if CRS and HS were to to both work, that would be, uh, I think a stunning Revelation from our point of view and we would really press the pedal down on the next generation of DPP 1's for these other indications because at that point we we believe we would have validated that. We're holding something of a biological skeleton key for neutrofil mediated diseases.

Well, if I could just quickly follow up, just so on your next Generation dppp ones what uh then would be an ideal TPP for your next.

DPP.

Yeah, fair enough. We'll have to come up with some new shorthand. Um, I think, you know what we're doing right now, and, and this is where our confidence comes in that next Generation with the, uh, subsequent indications and write really the strength of the breno, uh results in bronkiektasis. We think there, there is opportunity for this mechanism to apply in other disease States and that is not entirely uh, neutrofil mediated disease speculation. We've done animal models both with breno and with the successor molecules, that's why they're basically ready to go into the clinic next year. With that work in hand. We know what each of the different molecules um can do in terms of performance in those animal models. And I can tell you that, some of, those are are pretty reliable in terms of their translatability into the clinic. So I think,

Were excited by the enormous potential that that represents because these diseases were talking about rheumatoid arthritis, COPD asthma IBD. These are very significant indications and while they may have a number of, uh, other approved or competitive products, we still hold by the standard of first or Best in Class. And so, if our drug has a meaningful role to play in those settings, uh, you can expect us to be bringing, um, those subsequent molecules forward and each, it's our plan right now that each molecule would have its own dedicated disease, it would be targeting, uh, which is somewhat unique and an unintended byproduct of the operation of Ira, uh, where we are, uh, constrained down to 9 years, to get the, um, return on any investment we make on the molecule as a consequence of that, we actually have to go after the other disease indications using new molecules and that's why we are where we are.

Thank you.

Your next question comes from the line of Andy chin, with wolf research, please go ahead.

Hey, uh, thank you for taking the question. Um, another question about CRS without nasal polyp. Um, I'll, I'll understanding here is that it's both, uh, driven by a snails and neutral Fields, just wondering in your understanding of the disease, is that heterogeneous on the population level, as in that there are separate endotypes of different patients, um, driven differently by different, uh, different cells, or is it on an individual patient level. As in each, each patient is heterogeneous and

Contribution from both sides. Thank you.

And neutrofil driven disease. Um, that is quite a we we felt a revelatory discovery and it means that um we don't have to worry as much about that at least up to that threshold of eosinophil counts and those mixed uh profile patients. We expect to be responsive because they were in the Aspen study um as we look forward. That also does open the door to thinking about CRS um with nasal polyps. Um which may be more eosinophil driven but where we may also be able to have a beneficial effect. So that's something we're reflecting on. I don't know Martina if you want to add anything to that. Yeah, maybe just with regards to the endotypes, you're right, similar, like what you've seen now in, bronchitis is endotypes are more defined of what is the biologic driver behind it? So is it need? Uh, neutrals is it is in fields and we don't only look at the 2. Big groups, there are subgroups, and neutral Fields play a role in all of the endotypes there are there's 1 Endo type that is really more driven or largely driven

But the largest proportion of patients in CRS is driven by a mixed endotype or strongly neutral driven endotype.

Thank you.

Your next question comes from the line of veal. Devon with Guggenheim Partners. Please go ahead.

Hi. This is Danielle long for for vomo. Thanks for taking our questions. Um, just another 1 on the, um,

On the already diagnosed Bronx this population. So yeah, you described this as being around, you know, 500,000 patients, half of which um, have had 2 plus. Reservations a lot. I see a year.

So you maybe discuss if there's any any a variability uh between doctors and patients on, you know what? They Define exactly as exacerbation in their real world practice. Um, I guess kind of getting to the idea that um 1 of the drugs available.

is it possible that, you know, the number of exacerbations that are being identified essentially goes up or maybe they're being under

Represented right now it's just know. Really drugs available for this indication. Thank you.

Yeah, so I think look whenever you're talking about a new uh, uh treatment for a disease that has nothing to treat it. There is a whole Cascade of Greater awareness that kicks off and that almost always in uh, results. In more patients being identified, more of the symptoms that help identify those patients being tracked and being looked for you're just raing the index of Suspicion among Physicians and patients and that's really the key objective of any disease State awareness campaign is to ask the question, what is causing this

Set of symptoms that I have. That's also a question that gets engaged with a lot of extra energy. Now, in a world where our drug is approved. As we expect next week, that opens the door to an answer to the question of what to do if you have it. Whereas right now a physician who determines it is, patient has exacerbations. Uh, as a byproduct of bronkiektasis. There's nothing they have to offer them other than some, you know, basic Airway clearance. So I think this is a dynamic that we're very interested to see how it will play out because we are aware of that other significant bolus of patients behind the ones we've identified today that could be eligible for treatment and I think, um, you know, the ability for Physicians and patients to recognize those exacerbations and document them. Lays the ground work for them becoming uh, patients who would be potentially appropriate and therefore potentially benefit from uh, the medicine. If it's approved as we expect next week,

I couldn't, um, be more excited about the possibility to make a dent in this disease space. It's important to remember that this disease has been around since the early 19th century when it was first identified and it has yet to have anything approved to treat it. So I can't overstate, I think how significant the arrival of this medicine will be if and when it's approved.

Your next question comes from the line of Jennifer. Kim with Cantor Fitzgerald, please go ahead.

I'm taking my questions and congrats on the progress. Um, maybe to touch on Market access again. I know you said that a simple at a station seems reasonable uh in terms of upfront, ease of access, I wanted to ask about the reauthorization process and and how those conversations have been going, are there any expectations in terms of um, requirements on that end?

Yeah. So our strategy here as the first ever approved medicine and disease. We absolutely do not need to contract if we don't you know want to in terms of how we're approaching the market access World, we're choosing to do so because our objective with that modest um

You know, give if you will upfront.

Process and reauthorization is absolutely a contemplated part of our discussion and negotiation with the market access world. As Roger said, um, we've observed that these discussions have been going uh, very well. I think it's fair to say that everybody recognizes the need for a medicine. This medicine's safety and efficacy profile is particularly compelling. So it is not a contentious, uh, interaction. When we talk about, how do we facilitate appropriate patients to get on the drug? How do we um, ensure that they can remain on the drug and and receive benefits? And and, you know, I think we're in extremely good, uh, State as it as it relates to that.

And that's helpful if I could ask 1 more, um, just the question on on launch analogs and and the Dynamics over the next couple of quarters. Um, partially think about

I guess the launch in the fourth quarter with, you know, out of pocket max for Medicare patients. And then on that and I guess perceived into 2026 once it reset

Yep. That's a that's a new feature, obviously. I'll ask Roger to address that. Yeah, so I think that that um as you think about the smoothing and you think about the the Medicare um oh over where you can spread out the payments over the over. The the full months, I think in the fourth quarter, we probably come in where we're actually in a pretty advantaged position where most patients have probably worked through their copay burden, uh, for the full year. Um, we'll see as we go into into 202026 and, and the first quarter that's a

To reset. That's always historically. Been a challenge. Um, I'm hopeful that, uh, as this will be the second year that this is implemented that perhaps, it's a more smooth process this year as patients and and payers and so forth and pharmacies get get used to that. Um, but but we'll see. Um, so and and we stand ready to to support as we can, um, our patients in in in any kind of out of pocket burden that we can address directly.

Thank you.

Your next question comes from the line of Leonid Tim shift, with RBC Capital markets, please go ahead.

Hey, uh, thanks for taking my question. Um, I wanted to ask on the launch, but maybe more specifically how you're thinking about, um, what the shape might be of a launch in Europe and your commitment to, um, Europe and xus geographies given both the mfn Dynamics. And just, you know, if there's any differences in how Physicians are thinking about, um, you know, their level of excitement for the drug in, in Europe, versus the us as well. Thanks.

So, I would say that the enthusiasm is sort of un Universal or uniform. Most of the, um, congresses that we go to are international in their scope and engagement. And as a consequence, we have relationships, uh, by virtue of error cases, approval in the US, Europe and Japan um, with all of those Physicians. And so we've had their the benefit of their perspective as we've traveled this journey in the development of a bronkiektasis medicine. Um and I would I would say it's it's equal there as it is here and so that

That creates a hopeful uh, opportunity. I think that's echoed by the fact that the regulatory interactions to date in Europe. The UK have been extremely positive as they have been with the us and that uh, sets us on a, on a trajectory where we'll be able to launch in Europe. And then Japan next year, um, on the uh discussion of the of the issue of how we're going to approach those territories, we have that infrastructure. We've been very successful with Eric case in those regions as is. So clearly demonstrated this quarter where both outperformed, um, and I think that's that's, uh, extremely encouraging because that experience and that Dynamic that's positive with those Physicians. And the Eric case setting, We Believe will translate over into bronkiektasis. So I think, you know, it's a very positive picture. We'll see, the launches will be next year, um, I'll remind everybody that when we priced our case, we set the list price at the same level in the US, Europe and Japan. Um, we thought that was the right thing to do. That's our

Our best effort to make sure that everybody is uh, investing in The Innovation that that we're bringing after all these years of development. And um, and so we'll see how this all plays out as we move forward. Hopefully, that addresses your question.

Your next question comes from the line of trunk hoen with UBS. Please go ahead.

Noah on for trunk. Thanks for taking our question. Uh, just for for us, we're wondering. Is there any potential read through from a the Birch trial to Cedar if uh, Birch reads out positive and then also just, um, looking for a clarification on the futility analysis in Cedar, we're just wondering, is that focused primarily on the primary endpoint of a change in absences and modules or do uh, clinical response. Also play a role in the futility analysis.

um, from Birch to Cedar, I'm just going to say I

I've said this publicly many times, I'm excited by the possibility of birch because um, CRS without nasal polyps again, as I said, rudimentary is in a rudimentary sense is kind of bronkiektasis in the nasal passage. I'm, I'm hopeful that we'll see some positive results or Trends in that study that would encourage us to go into phase 3. Um, HS is a much trickier disease and I think there are a number of variables that surround that which include the patient profile that you're targeting. So we've gone from moderate to severe patients. We could have targeted mild to moderate. There's in that patient selection process, you introduced some uncertainties about the ability of your drug to have an impact. There aren't great animal models. So I would put the uncertainty around um, Cedar much much higher than I would have been around CRS at least as far as the logic goes. And that's why we built the futility analysis so that they could go in and look at all the data and and make their conclusion about whether this study should proceed. Um, because

We certainly don't want patients experimenting with the medicine. If it's not going to be a benefit, I don't know. Martine. If you have anything, you want to add about that.

Yeah, and the futility analysis will be focusing on the primary endpoint. So it will be the percentage change of an nodule account, um, to week, uh, 16. And the reason that is the focus because this is where you see the immediate change, uh, a secondary endpoints and by the end of week 52, um, that we will also look of course, at high scores 50 or high score, uh, 75. So, but the interim will focus on the primary end point.

Your next question comes from the line of Steven Willie with stifel. Please go ahead.

Yeah, good morning. Thanks for taking the question. Um,

Should we expect registration on tip development in Paw to be limited to a single phase 3 trial? Um, or do you think you know, a broader sat like development program, maybe in different functional class and risk? Subgroups makes more sense here just given the strength of the phase 2 Data

Yeah, I think um, we'll know more once we've had the October meeting with FDA to be to be candid and I think um, our enthusiasm for this program as we have dug into the data in the aftermath of the Top Line results. Uh, I would say has grown and accelerated, uh, to the point where, you know, as Martina mentioned a moment ago, the results of the Teton study are going to be something. We watch very carefully.

We know how satisfied is perceived and what a positive, um, contribution that is to the disease State, um, remind you that that can only be operative in Paw. So, it doesn't have a role to play in PA child D. Um, we're sitting with what we believe to be the best, uh, clinical profile based on the phase 2 data for Paw for Phile and now, possibly for ipf, depending on how the Teton study reads out, um, with with that set of opportunities. Um, we would then obviously pursue uh, our own data in ipf, but um, that's a really significant uh, profile to, to be in possession of. And so I think we're going to move aggressively after every opportunity. I don't know if Martini you want to comment on any of the sub uh, approaches that sat has taken in our our approach to that.

Yeah, so I think we we have to have the discussions with the agency on the number of Trials or also how trial designs will look like we will, of course, uh, take into account that satisfied is on the market and how we will Design the trial reflecting subtitles. That at this point, we can speculate of what will be the effect size on top of it. But we know that with the phase 2 Data the profile both on the efficacy and on the safety is the strongest 1 that we think in the prostanoid group. So we have um, very strong confidence level on tip and then we'll see what on top of it. So tatis, how that would

It looked like we are also able, and you've seen this in the phase 2 study to reach higher Doses and therefore, um, have the opportunity to deliver significant efficacy impact. That may sometimes be an opportunity to also go to lower doses on satisfactory, which is a very good drug. But you always look at it in context of what is your overall benefit risk? What is your safety profile? So, I think that remains to be seen but we will Design the trial to make sure we can answer these questions.

All right, thanks.

Your next question comes from the line of Maxwell score with Morgan Stanley. Please go ahead.

1201 from other gene therapy approaches in DND. Thank you.

So I will just say so far so good. A caution is the watch word around, uh, anything to do with gene therapy these days. And and we have, I would say a belt and suspenders approach to each and every patient that we are bringing into this, it must be enormously, unsettling for uh, parents with kids, who suffer from this uh, disease to have experienced, what has gone on recently in in this space. Um, we set out 4 years ago when we bought modus, um, to give, uh, support to Brian's Vision. That an intrathecal delivery route would improve safety and efficacy. And the early animal data work that was conducted validated, those, um, ideas. I think were anxious to see what the the human data obviously will show. Uh, but we're going to be going very cautiously and slowly giving the um experience recall that part of the reason for in delivery as an exciting Innovation is, um, you don't have

have that first pass liver affect and the consequence of that is you can dose less virus, uh, to the patient and notwithstanding all of that, the transduction efficiency that we saw in muscle and even cardiac tissue was remarkable. And so it is for those reasons that we think a lower dose greater efficacy potentially greater safety. Um, may be the profile of this uh, treatment when it

uh, when all is said and done,

Great. Thank you.

Oh I want to make 1 other comment. Actually, you know. Martina do you want to address that uh, 1 other issue that we want to make sure people are aware of that? Is that is distinct and important for US versus others in the gene therapy space in DMD.

1 of the advantages right now in the it.

Delivery that we can.

Have weight based dosing in our study. And I think that is a different approach. Also,

We have now reached the end of our question-and-answer session. Ladies and gentlemen, this concludes today's call. Thank you all for joining; you may now disconnect.