Amicus Therapeutics Q2 2023 Earnings Call Transcript

Quartr
Provided by Quartr
August 8, 2023

There are 14 speakers on the call.

Operator

Morning, ladies and gentlemen, and welcome to the Amicus Therapeutics Second Quarter 2023 Financial Results Conference Call and Webcast. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr.

Operator

Andrew Fonin, Vice President of Investor Relations, you may begin.

Speaker 1

Thank you, Tano. Good morning. Thank you for joining our conference call to discuss Amicus Therapeutics' Q2 2023 Financial Results and Corporate Highlights. Leading today's call, we have Bradley Campbell, President and Chief Executive Officer Daphne Queamy, Chief Financial Officer Sebastian Martell, Chief Business Officer and Doctor. Jeff Castelli, Chief Development Officer.

Speaker 1

Joining for Q and A is Doctor. Mitchell Coleman, Chief Medical Officer and Ellen Rosenberg, Chief Legal Officer. As referenced on Slide 2, we may make forward looking statements within the meaning of the Private and the Securities Litigation Reform Act of 1995 relating to our business as well as our plans and prospects. Our forward looking statements should not be regarded as a representation by us Any or all the forward looking statements made on this call may turn out to be wrong and can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. You are cautioned not to place undue reliance on any forward looking statements, which speak only to the date hereof.

Speaker 1

All forward looking statements are qualified in their entirety by this cautionary statement, We undertake no obligation to revise or update this presentation and conference call to reflect events or circumstances after the date hereof. For a full discussion of such forward looking statements the risks and uncertainties that may impact them, we refer you to the forward looking statements and risk factors section of our annual report on Form 10 ks for the year ended December 31, 2020 2 and the quarterly report on Form 10 Q for the quarter ended June 30, 2023 to be filed later today with the Securities and Exchange Commission. At this time, it's my pleasure to turn the call over to Bradley Campbell, President and Chief Executive Officer. Bradley?

Speaker 2

Great. Thank you, Andrew, and welcome everybody to our Q2 2023 conference call. I'm very pleased to highlight what has been an incredibly Successful first half of the year across our global business. As we did in this morning's press release, let me highlight several key points. First, Galafold continues its strong performance and remains the cornerstone of our success.

Speaker 2

We remain very pleased with the commercial uptake of Galafold globally with $180,000,000 in revenue for the first half of twenty twenty three. This represents 16% growth from last year on a constant currency basis. In the Q2, operational growth was 17% year over year at constant exchange rates. We continue to observe strong trends across our key performance indicators in all Key geographies in the Q2. This includes increasing demand through new patient starts from both the switch and naive populations, Steady growth of in person visits between our field team and Fabry Treaters around the world and sustained patient compliance and adherence rates of over 90%.

Speaker 2

Growth in the Q2 was driven primarily by patient demand. And as Sebastien will highlight in a moment, we saw new patients starting on Galafold globally throughout the second quarter at rates we haven't seen since the 1st few years of launch. Based on Galafold's strong first half performance, We're pleased to be raising our full year 2023 revenue growth guidance range to 14% to 18% at constant change rates. 2nd, we continue to make great progress on our global regulatory filings and have now commenced the commercial launch for PONDBILETE and AFOLDA, our novel 2 component therapy for Pompe disease. Following the EC approval of Uphold in June, the commercial launch is well underway in Germany.

Speaker 2

Our team is in the process of switching over individuals from clinical studies and expanded access programs to commercial supply, and we're pleased to share that the first patients Have now been dosed with commercial product, multiple additional patients having been scheduled to start their infusion in the coming days weeks. Importantly, we're well on track to transition to 20 clinical trial and expanded access patients within our 90 day target. Outside of Germany, we're focused on broader patient access across Europe as we navigate the country by country pricing and reimbursement process. In the U. S, we've been pleased to see an increased level of engagement from the agency in recent weeks and are confident now we're on track for an FDA approval in And finally, the UK regulatory process for APJ was initiated in December of last year, and we have just received word this morning that the MHRA has As a reminder, MHRA previously approved Bombility and both have received orphan designation.

Speaker 2

We now expect the NICE final assessment document to come in the next few days, at which point it will take about 30 days for the NHS to provide funding to local centers to begin commercial infusions. With our international launch commenced and poised for regulatory approval in the U. S. And additional key markets on the horizon, We look forward to providing a real choice and challenging therapeutic expectations for both physicians and the people living with Pompe disease around the world. Finally, Anakus has maintained a strong financial position as we continue to execute on the global expansion of Galafold and begin the global launch of PONDBILTY and UPHOLDA.

Speaker 2

Importantly, based on the latest assumptions on approvals and launch of PONDBILE and IFFOBA, combined with the strong growth we've seen in Galafold in the first half of the year, We are on track to achieve our target of non GAAP profitability in the second half this year. Ahead on Slide 4, we're making great progress across Our key strategic priorities for 2023, including sustaining double digit Galafold growth, now at an anticipated growth rate of 14% to 18% at constant exchange rates securing regulatory approvals of ATGA by the FDA, EMA and MHRA and executing successful launches in those key markets continuing to judiciously invest in the advancement of our best Next generation Fabry and Pompe genetic medicines and capabilities as well as our next generation chaperone for Fabry disease And as always, maintaining a strong financial position as we carefully manage our expenses and investments on our path to non GAAP profitability. With that overview, let me now hand the call over to Sebastien Martell, our Chief Business Officer, to further highlight our commercial performance. Sebastien?

Speaker 3

Thank you, Bradley, and good morning to everyone on the call. I'll start by providing you with more detail on our Galaport performance for the quarter. On Slide 6, for the Q2 2023, Galafold reported revenue reached $94,300,000 driven by strong patient accruals, particularly in the U. S, but also in key European markets and Japan. Geographic breakdown of revenue during the quarter consisted of $57,000,000 or 61 percent of revenue generated outside of the U.

Speaker 3

S. And the remaining $37,000,000 or 39% coming from within the U. S. We're very pleased to see continued pace in growth in countries across our leading markets. Turning on to Slide 7.

Speaker 3

Our results in the first half of the year highlighted the strength of our global commercial efforts. The demand for Galafo globally continues to be strong with patients added in all major markets, delivering operational growth rate of 16% for the same period in 2022 at constant exchange rates. From a year over year perspective, the negative impact from foreign currencies was 3% in the period and as a result Galafold reported revenue growth was 13%. Galafold continues to be the fastest growing treatment for Fabry disease globally. And I'm pleased to report that our monthly net new patient trends continued to increase in Q2.

Speaker 3

And if you look at the growth in net patients on Galafold globally, we've seen significant net patient gains on Galaford at the end of the second quarter. Throughout the first half of twenty twenty three, the number of patients coming on to Galaford has actually exceeded internal expectations and we're therefore raising our full year 2023 revenue growth guidance to 14% to 18% growth at constant exchange rates. We ended the 2nd quarter with about 60% of the global market And within the global mix, we're seeing stronger uptake in naive populations. And while we're achieving high market In countries where we've been approved the longest, there's also plenty of opportunity to continue to switch patients over to Galafold and continue to grow the market as we penetrate into the diagnosed and treated and newly diagnosed segments. All of that is underpinned by impressive compliance and adherence rates have continued to exceed 90%, reiterating our belief that those patients who go on Galafold permanently stay on Galafold.

Speaker 3

As mentioned on past calls, due to a variety of factors, including uneven ordering patterns and FX fluctuations, The rate of growth within the year is typically non linear. We expect that to continue throughout 2023. And to support quarterly forecasting, we provide A table showing distribution of GAAP or revenue by quarter in the past 5 years in the appendix section of our IR presentation. On Slide 8, we know that there's significant patient demand for Galafold and that the segments of the global phalli market made of those amenable mutations has the potential to surpass $1,000,000,000 in annual revenue in around 5 years. We anticipate sustained growth throughout 2023 to be driven by several key growth drivers.

Speaker 3

1st, continuing to penetrate into the existing markets, Further uptake into the diagnosed untreated population and expanding into new geographies and label extensions. All of these efforts are supported by positive reimbursement and access mechanisms around the world. I'm pleased to share that we continue to make progress on Just to name a few examples, we recently received reimbursement in Taiwan for individuals over the age of 16 years old. The Fabry market within Taiwan is quite sizable with over 3 50 individuals diagnosed with Fabry disease. Of note, Galafold was designated the 1st in line therapy for all amenable patients living with Fabry disease in Taiwan.

Speaker 3

Additionally, we've submitted the marketing authorization application in New Zealand and we've entered into pricing and reimbursement negotiations for Galafold in Turkey. In the longer term, we continue to see significant growth in the Fabry market globally, driven by diagnosing patients through a variety of measures, including high risk screening, newborn screening and other diagnostic initiatives, which we continue to support and invest in as well. With that, let me now hand the call over to Doctor. Jeff Casselli, our Chief Development Officer, to highlight the regulatory updates on our ATDA program. Jeff?

Speaker 4

Thank you, Sebastian, and good morning, everyone. Starting on Slide 10, we remind everyone that Late onset Pompe is a severe and fatal neuromuscular disease and one of the most prevalent lysosomal disorders. Within LOPD, individuals may experience impaired motor function and respiratory difficulties as the disease progresses, with these potentially debilitating symptoms tending to become more Multiple publications and natural history studies continue to show that the initial benefits of treatment are often followed by continued long term decline for many individuals. We recognize that Pompe disease continues to pose a range of health challenges for people affected by the disease and having therapeutic options is crucial. Moving on to Slide 11, we briefly outline the current regulatory status of ATGA by key markets.

Speaker 4

First, as noted, in June, POMBILETE and OPOLTA both were approved in the EU and the commercial launch is underway as Sebastian will detail in more in the next section. And in the U. S, as Bradley noted, we're pleased to see the increased level of engagement from the agency in recent weeks and remain confident we are on track for approval in the Q3 for both components of ATGA. And finally, just this morning, we were very excited to receive The final full approval and orphan designations for both POMBILEA and Aflota by MHRA and now the team can begin launching this important new therapy for people living in the U. K.

Speaker 4

With Pompe disease leveraging that positive reimbursement appraisal from NICE. Moving on to Slide 12, we remind everyone of our ongoing clinical studies and multiple mechanisms of expanded access that support much of the early demand for ATGA. For the younger Pompe community, we continue to enroll the ongoing open label zip study in children up to 18 years of age living with LOPD and have begun enrolling the open label RYZELA study for children living with infantile onset Pompe disease. We have multiple expanded access programs in place in countries where we are not yet approved and interest and momentum for ATGA continues to grow We're pleased to be able to provide access to those who are eligible through those programs. As a reminder, at the time of our first approvals, which 1st in the EU during that last week of June, there were approximately 200 patients worldwide being treated with ATGA across And importantly, experience with ATGA is quite broad with approximately 75 centers participating in trials and various access programs around the world.

Speaker 4

Finally, as highlighted in the pipeline slide in the appendix, For our earlier stage pipeline, we continue to focus on novel approaches for Fabry and Pompe, including gene therapies to deliver our engineered GLA and for the Transgenes and the next generation Fabry chaperone program. With that, I'll turn the call back over to Sebastien to discuss the early commercial launch progress of Humility at Sebastian?

Speaker 3

Thank you, Jeff. On Slide 13, we outline the initial launch progress and market opportunity for COMBILITY Opolda in EU. COMBILITY plus Opolda is approved as the first And only 2 component therapy available in the EU for the treatment of adults living with late onset competencies. We're very pleased with the strong indication for Complile D plus of FOLDA, which addresses all adults living with LOPD. The EU market represents a sizable opportunity of $450,000,000 plus and is a key market to support in the early stages of global launch.

Speaker 3

Within Europe, there are currently around 1300 patients estimated to be on treatment. And of that 1300 currently 60 patients are being treated with POMBILEITY plus OpFOLTA and around 20 of those in Germany and Australia. As of today, we are launched in Germany with progress being made on all fronts and we're seeing the start of a very strong uptake. Importantly, in Germany, The Federal Joint Committee or GBA has classified Bombility as a new active substance. As a result, Bombility will undergo Benefit assessment under the AMNOC process with a free pricing period after which there will be negotiations on the final reimbursed price.

Speaker 3

Based on feedback from key treaters through our clinical development, access and medical affairs, we're very pleased with the progress made towards transitioning patients over to commercial supply. We've been successful in engaging with the top prescribers in Germany within the 1st 30 days. We've also been very pleased with the positive feedback from the expanded access program, CUP, from both a physician and patient perspective. As Bradley mentioned, the first patients have been recently moved to commercial supply and more are scheduled in the coming weeks. So So we're well underway to achieving our goal of converting all of the 20 or so expanded access patients and clinical trial extension patients within the 1st 90 days of launch.

Speaker 3

On Slide 14, as you know, we've been preparing for the commercial launch of Bombiliity plus Opolda And I'm both excited and confident that through our world class commercial and medical organizations, we're in a very strong position for a second successful launch at Amicus. In these early days, we're leveraging this experienced team to transition the 1st group of clinical trial and expanded access program patients in the EU On to commercial supply. Given the significant overlap of treatment centers, hospitals and physicians between Fabry and Pomped Villiers, We have the existing relationships with KOL and the commercial infrastructure necessary to support a seamless transition. As of today, we've had the first patients infused and multiple additional patients are scheduled to start their infusions. Within these early days, we find an important metric to track is our progress with access and reimbursement.

Speaker 3

We have a highly experienced team who are engaging in positive interactions with payers to demonstrate the value of Bombili T plus Upfolder. Today, we're launching Germany, but we're also in active pricing and reimbursement discussions with additional European countries as we focus on securing broad patient access to the EU. We're working in partnership with physicians to ensure they have all the information They need on Populity plus Afolda for their patients and believe this 2 component therapy is poised to have a significant commercial opportunity in the EU and additional markets as they come online. As Jeff indicated from the late breaking news, we're thrilled with today's approval of MHRA approval for OpFolda. We also were granted orphan designation for OpFolda like we did with POMBILETE in the UK.

Speaker 3

The market opportunity within the UK includes more than 200 people with Pompe disease, estimated to be on treatment. 45 of these 200 individuals are already on POMBILETE plus a folder and that's a remarkable number, either through a clinical trial or through the early access medicine scheme. As we've mentioned previously, all leading centers across the UK Have requested access to Pombility plus APOLLDA through IMS. Now that approval has been granted, our team anticipates the transition of all patients in the UK onto commercial product within 90 days. And importantly, that transition will be supported by the very positive NICE recommendation for reimbursement of Bombivity Plus for Sofolda within the NHS, which is an achievement we are incredibly proud of.

Speaker 3

As stated in the guidance, NICE concluded that the cost effectiveness estimates for Pombili T plus Opolda showed a positive net health benefit and therefore has recommended Pombili T plus Opolda for adults with LOPD as first line and later lines of therapy. With that, I'd like to now turn the call over to Tafni Quimi, our Chief Financial Officer, to review our financial results, guidance and outlook. Daphne?

Speaker 5

Thank you, Sebastian, and good morning or afternoon, everyone. Our financial overview begins on Slide 16 with our income statement for the Q2 ending June 30, 2023. For the Q2, we achieved total revenue of $94,500,000 which is a 17% increase over the same prior year period in 2022. This includes year over year operational revenue growth measured at constant currency Exchange rates of 17% and a negligible currency impact of 0%. Cost of goods sold as a percentage of net sales was 9 point 6% as compared to 10.2% for the prior year period.

Speaker 5

Total GAAP operating expenses decreased to $104,200,000 for the Q2 of 2023 as compared to $133,100,000 in the Q2 of 2022. On a non GAAP basis, total operating expenses decreased to $84,000,000 for the Q2 of 2023 as compared to $119,200,000 in the Q2 of 2022, primarily reflecting decreased program spend. We define non GAAP operating expenses as research and development and SG and A expenses, excluding share based compensation expense, Loss on impairment of assets, changes in fair value of contingent consideration and depreciation. Within other expenses in the income statement in the Q2, we recorded approximately $11,000,000 in unrealized foreign exchange losses. This compares to a $7,000,000 gain in the Q2 of 2022.

Speaker 5

We are currently taking steps to mitigate our future exposure. Net loss for the Q2 of 2023 was $43,200,000 or $0.15 per share as compared to a net loss of $62,200,000 or $0.21 per share for the prior year period. Driven by the revenue growth of Galafold and careful expense management, We continue to make progress towards our path to non GAAP profitability in the second half of this year. As of June 30, 2023, We had approximately 287,000,000 shares outstanding. Turning now to Slide 17.

Speaker 5

With a focus on achieving non GAAP profitability, I am pleased to share that we have revised both our revenue and operating expense guidance for the year. We are raising full year Galafold revenue growth guidance to 14% to 18% at constant exchange rates driven by patient demand. We are also reducing our full year 2023 non GAAP operating expense guidance to $330,000,000 to $350,000,000 The decrease in operating expense for 2023 as compared to 2022 will be achieved by continuing to drive efficiencies and prudent Thanks, management, offset by continued investment in Galafold's AT GAA clinical studies, non recurring costs for manufacturing as well as global launch activities. We anticipate operating expenses to be nonlinear this year Due to these pre launch and launch expenses, we also expect to see a larger portion of our operating expenses allocated to G and A this year as we align our resources to support the launch of AT GAA and the continued growth of Galafold. Cash, cash equivalents and marketable securities were $265,600,000 as of June 30, 2023, compared to $293,600,000 as of December 31, 2022.

Speaker 5

And with that, let me turn the call back over to Bradley for our closing remarks.

Speaker 2

Great. Thanks, Daphne, Jeff, Sebastian. As you can see, we've been relentlessly focused on across our global business and we look forward to embarking on this next phase of Amicus as a company with 2 commercial therapies. Thank you to all of our employees who have enabled us to achieve these recent corporate milestones and who are always committed to our patient focused mission of delivering life changing therapies to people in need. Before I hand the call over to Q and A, as you may have also seen in this morning's filing, after 15 incredible years at Amicus, Daphne, our long time Chief Financial Officer, leader and friend has decided to retire.

Speaker 2

She'll remain in her current role as CFO until we appoint her successor, At which point, she'll remain on with Amicus through the end of the year in order to support a smooth transition. A search is underway and we've already identified a number of highly qualified candidates. I also just want to add that I'm personally grateful to you Daphne for your years of exemplary service here at Amicus and in particular for helping lead us on course to achieve non GAAP profitability later this year. On behalf of the Amicus Board of Directors and the entire executive team, I'd like to take this opportunity to formally thank you. You've been a significant part of the growth at Amicus and instrumental in guiding us to the sound financial position we're in today.

Speaker 2

With that, operator, we can now open up the call to questions.

Operator

At this time, we request that you only ask one question. If you have any additional questions, please enter back into the queue. Thank you. And our first question comes from Tazeen Ahmad of Bank of America. Your line is open.

Speaker 6

Hi, guys. Good morning and thanks for taking my question. Brad, just wanted to clarify on the time lines that you've stated forward for GAA is still expecting approval in 3Q. Do you get a sense that the responses that you gave FDA post the Wuxi inspection facility have been sufficient For the agency, if not, what do you think are the remaining gating factors regarding questions around the facility in order to get approval? Thanks.

Speaker 2

Thanks, Tazeen. Yes, great question. Just as a reminder, we were very pleased with the outcome of the preapproval inspection at Wuxi. We do feel like our responses were all adequate and the color we provided in the call here today I think is important, which is in the last We've seen an increased level of engagement from the agency and so that gives us great confidence that we're on track for QPA approval.

Operator

One moment for our next question. And our next question will come from Anupam Rama of JMP. Your line is open.

Speaker 4

Hey guys, thanks so much for taking the question. Congrats on the progress. And Daphne, I'll miss you at the conference this coming year. On the Galafold guidance increase, maybe from a regional perspective, where is that coming from? Is it coming from deeper penetration in Core countries or progress in some of the new emerging countries?

Speaker 2

Yes, I'm happy to have Sebastian add a little bit of color, but honestly, Anupam, it's coming from All of those things. So most importantly, we're seeing is across all of our key geographies, as we mentioned

Speaker 4

on the call,

Speaker 2

Rates of net new patient starts at levels that we haven't seen since the 1st couple of years of launch, and so clearly demand for this product is growing. But Sebastien, maybe touch on a few of the different growth drivers that Anupam highlighted and give a little bit more color there.

Speaker 3

Yes. I'd just add, for example, in the U. S. Alone, remember we launched in 2018. The current rate of net new patients that we've seen in the Q2 is as strong as what we saw in 2019.

Speaker 3

So we're really in a post COVID world as we speak and we're seeing Strong patient accruals. This is also The case in Europe, and remember in Europe, we were launched a couple of years earlier. So our penetration rate Within the amenable population is slightly greater And yet we're seeing very strong demand. A lot of naive patients actually go on Ganafold When they're diagnosed, so we've essentially established Ganaford as the new first in line treatment for Fabry patients with amenable mutations in those markets. Yes, maybe if I'm

Speaker 2

going to ask other things I'd highlight Sorry, I didn't mean to cut you off. I was just going to say the other thing I highlighted and Sebastian mentioned on the call, not only are we seeing great penetration rates, we're opening up new geographies. So we have some important countries coming on board this year. It's also in the backdrop of a very healthy and growing February market. So diagnosis And as we find those patients, as a reminder, typically you find 1 undiagnosed Fabry patient or newly diagnosed Fabry patient.

Speaker 2

And because it's And X linked disease that typically leads to 4 to 5 additional family members who are diagnosed. So in addition to I think Executing incredibly well, which we've continued to do. We're also seeing just a healthy growth of market. And as Sebastian highlighted, we're actually the fastest growing of the Fabry treatments For patients with the number of mutations.

Speaker 1

Thanks for taking our questions.

Operator

One moment for our next question. Our next question will come from Ritu Baral of TD Cowen. Your line is open.

Speaker 7

Good morning, guys. Thanks for taking the question. I want to

Speaker 8

go back

Speaker 7

to the WuXi inspection and follow-up on To Zane's question. Brad, can you give any additional detail on the points of the increased level of engagement that the agency Just wrapping all of this up, do you think that there is any possibility of requiring a reinspection Or do you feel that the outstanding items are addressable over Written or verbal interactions, any additional detail would be helpful.

Speaker 2

Yes. Thanks, Cazeen. No, we do not believe that there'll be any additional inspections needed at Wuxi. We are very confident and we're very pleased with the outcome of the inspection. And again, just based on the kind of level of reengagement we've seen, increased level of engagement we've seen in the last couple of weeks, it feels to us, as you said, that they're Wrapping things up and we feel like we're getting close to an approval here as we suggested on track for Q3.

Speaker 2

So we're really excited. The team is ready. We're really pleased to see the UK news this morning. So I think the momentum is building and really eager to see the remaining months of the year play out.

Speaker 7

Got it. If I can squeeze one more in, about how much supply do banks, how much supply from the open label Are German and UK patients sort of sitting with before they start on the path to commercial conversion?

Speaker 2

Yes. We have our target is about 2 years of go forward supply. Remember, we've made quite a bit of

Speaker 7

I'm sorry. I meant like how much supply clinic how much drug supply do they have sitting at home from the open label?

Speaker 2

They're working through, right, right. Got it. Sorry. Yes, the good news is unlike Galafold where you would typically because it was Long shelf life, etcetera, you could be sitting on kind of 3 months of supply of Galafold as we are winding down the clinical studies and transitioning over To commercial, in this case, it's a much tighter supply situation. And the clinical operations team at Amicus, who of course has already done this once before with Galafold, works very closely with the medical affairs team, with the sites themselves.

Speaker 2

And so it's a really fine and precise level of supply. And that's what allows us to very carefully manage and have that goal of 90 day transition. And in Germany, so far, as I've said, even in the first kind of 30 days Of launch now, we are making those transitions and we're confident we'll be able to execute that within the 1st 90 days and I think likewise in the U. K. And then the U.

Speaker 2

S. When we see the approval.

Speaker 7

Great. Thanks.

Speaker 2

Yeah.

Operator

One moment for our next question. And our next question will be coming from Ellie Merle of UBS. Your line is open.

Speaker 8

Hey guys, thanks so much for taking the questions. Just if you could provide us a little bit more color on how you're thinking about new patient starts In Germany and the U. K. Beyond the patients that are on expanded access. So maybe just of the 200, I think you said Pompe patients total in the U.

Speaker 8

K. And I think you said 45 were already on AT GAA. How should we think about the other 150 patients? And maybe what proportion might be on nexiozymes already and just the timelines for when you expect the NICE reimbursement to kick in from a revenue perspective. And then in Germany, I know you mentioned You have 20 patients already on AT GAA, but just if you could give us a sense of maybe how many Pompe patients there are in Germany and how you think about the landscape there relative to next few slides?

Speaker 8

Thanks.

Speaker 2

Sure. I'll take Some of those and then I'll ask Sebastian to add some color as well. That was a cleverly worded one question, multi question Prompts, but happy to address all of those. So first of all, yes, the first priority as we've said in each of those markets because we have such a large bolus of patients is The expanded access in clinical trial patients, but of course in parallel we're also working to start to begin bringing on new patients as well. We should be able to provide more color on that in the November call, but again, first priority, low hanging fruit Patients on ATG already and then in parallel start to bring on new patient starts as well.

Speaker 2

And then maybe, Sebastien, just give the color that we know based publicly available information, what progress has been with Nexlyzymes in those two markets and a sense for how large the German market is outside The 20 patients already on APGA.

Speaker 3

Yes. Thanks, Bradley. So the I can Share with you the breakdown between Nexiazyme and Myozyme across Europe is virtually 80.20 or 77%, 23% to be precise. So the vast majority of patients are still on Myozymes, again 77% across Europe and 23% for next year Zai. If you look at The UK numbers, you have them, you just quoted them early.

Speaker 3

So 200 patients total, 45, which is probably the largest number of patients we have in a country on clinical trial plus Early access. And so as Brad mentioned, we think that Given the fact that the 6 key centers have all had experience with mobility and Afolda, They will have patients transition from either clinical study or EIMs. They have experience. They've used the product before. They have obviously the feedback also from patients who have been on it.

Speaker 3

So we think that The uptake and our ability to convert commercial patients from Myozyme or Nexozyme is high in this market. In Germany, the market is a lot more fragmented than the UK. The number of patients is also higher, somewhere between 30350 total patients. We did mention here that we've got around 20 in Germany and Austria. So those will be the first patients on to commercial product.

Speaker 3

But as I mentioned, our team has been Visiting top prescribers in Germany for a number of weeks now and established those contacts And we'll be working with those physicians to convert and switch patients from their existing treatment onto POMBILEITY plus Afrola over the next weeks months.

Speaker 2

And I think you had maybe one more question, Eli, on the reimbursement process in the UK. So As I mentioned in the call, once you have MHRA approval, what's remarkable here is we've already had the initial recommendation for reimbursement by NICE, which we think is one of the fastest ever to get to that answer prior to MHRA approval. The process from here should take a few days to a week to get to the final appraisal document By NICE, the draft is already posted, so that should come here relatively shortly. And then it takes around 30 days for NHS to provide funding to the local centers and that's when we'll start actually converting those expanded access in clinical trial patients. But in the meantime, with the approval, our sales team can go out into the field, visit the physicians, and again, along with the medical affairs and The operations team can begin scheduling those infusions ahead of time.

Speaker 2

So effectively launch is underway and we're waiting about 30 days for that reimbursement process

Speaker 8

Okay, great. Thanks. Really helpful.

Speaker 2

Thanks, Alex.

Operator

One moment for our next question. And our next question will be coming from Joseph Schwartz of Leerink Partners. Your line is open.

Speaker 4

Great. Thanks very much for the update. I was wondering beyond the EAP conversion Of those patients to commercial status, how should we be thinking about the cadence of uptake for AT GAA? And what metrics will you be providing us in order to gauge your progress with that? And are there any analogs that You can think of that might be helpful for us when envisioning the launch curve.

Speaker 4

And then can you remind us of your most recent thoughts around pricing and how this relates to the current price of Sanofi's products? Thank you.

Speaker 2

Yes. Thanks, Joe. All good questions. So as it relates I'll start with the last one first. As a reminder, our pricing philosophy is Parity or modest discounts to standard of care and we have shown with Galafold that that is an incredibly successful strategy.

Speaker 2

We went Through the pricing and reimbursement process with Galafold much faster than industry average. And I think it's because the healthcare systems are Recognizing that we're bringing significant value, but we're pricing at roughly parity, which takes the pricing decision off table and focuses on the value of the product and what we saw is that way you can maximize access to therapy and maximize the number of patients on therapy as quickly as possible versus taking time to negotiate for some extra dollars on the price. And I think the nice appraisal that we saw here, which Again, I think it's one of the fastest ever in our industry is a great reflection of that value that the payers are seeing. So we're confident that strategy will be very successful here And we'll roll that out as we go through the process in Europe, in the U. S.

Speaker 2

And in other markets. On the first one in terms of key performance indicators that were shared, I think what you've heard on the call today is some of the qualitative things we'll talk about in terms of getting out to see the key centers, In terms of having patients start on infusions and convert from clinical trial to commercial products, we haven't given any forward looking guidance For this year, just because it's such a stub year, but I think you'll hear on the November call that we'll provide an update on the number of Commercial patients on drugs, so that'll be a nice milestone to wait for. In terms of kind of analogs, it's so unusual to have 2nd generation product launched into the rare disease space. I don't know if they're great analogs. The one thing I would point to though is kind of A thought experiment perhaps is remember we qualified for that EAMS program in the UK about a year ago.

Speaker 2

And within the 1st year, remember that you can't promote on that product, it's simply offering it and it's purely demand driven. And we were able to get to a 15% 20% market share through that program alone, again, with no promotion. So for me, that gives you a great perspective Imagine what we can do once we're out there promoting the product. So we'll do our best to give good color on how the launch is going and hopefully, that gives you a flavor of how we can talk to that over the coming days weeks. And again, November, I think, will be a really important update there.

Speaker 9

Thank you.

Operator

One moment for our next question. And our next question will be coming from Dae Gon of Stifel. Your line is open.

Speaker 10

Hey, good morning guys. Thanks for taking the question. One clarification, the slide says first patient as in plural has been infused with LOPD I guess ATGA GA Product, just wanted to clarify that it was more than one. And then my actual question was the physician Feedback and engagement. What are you guys hearing in terms of the lineup that physicians will take once Nexvia, I guess ATGA becomes available as a 3rd line.

Speaker 10

I mean, does it get kind of placed at a 3rd line? Or do you see it being used sort of in the In between Myozymes, Nexviazymes or Nexviazymes ONTU, ATGA, any color on that would be helpful. Thanks.

Speaker 2

Yes, thanks. So first and foremost, the feedback we've received has been incredibly positive from physicians And we're hearing through them that the experience from patients has also been very positive. So we feel like everything is going really well. Yes. To clarify that your first question, it is multiple patients have been converted, which is great and multiple patients have been scheduled for their infusions And we're working to schedule the remaining conversions within that 90 day target.

Speaker 2

So really, really good progress as we've gotten started here. And then, sorry, remind me the second part of your question. Oh, in terms of positioning. Yes. So reminder, in Europe, the indication statement is for all patients, late onset Pompe disease patients.

Speaker 2

And so we'll position this and we think this will be a great treatment option for all of those patients. Remember though that the vast, vast Majority of the market opportunity here is patients currently on Myozymes. And so you should see just like we saw with Galafold, you should see The vast majority of growth in all of our markets coming from patients who we switch from Mizyme or NeckBizyme, frankly, to APGA. And I think that's an important point, right, which is the indication is for all patients with LOPD In Europe, we're on label and that means that we can target any patient on therapy or frankly any new patient The diagnose or has already been diagnosed.

Speaker 3

And just to add to what you were saying, Brad, I think To give a little bit of color on the global opportunity from a patient standpoint, there are 3,500 to 4,000 patients being treated worldwide for Pompe disease today, we estimate that depending on the year, you've got somewhere between 100 to 200 Naive patients put on treatment every year. So the commercial opportunity as of this point is really Looking to switch patients whether they are on Myozyme or whether they are on Nexozyme, this is the main Patient group that we're going to go after.

Speaker 2

And the last thing I'll say there is remember, the real promise of this medicine is that we're the only Product in a well controlled clinical study that shows that patients who are on an existing ERT can switch to ATGA and see improvement in 6 minute walk in So we think that's a truly differentiated component of this therapy and we're just so pleased And eager to get this out to as many patients as possible as quickly as possible.

Speaker 10

Great. Thanks for the color. And Daphne, thanks so much for your service.

Operator

And our next question will be coming from Jeff Hung of Morgan Stanley. Jeff, your line is open.

Speaker 11

Congratulations on the MHRA approval of Upholda and congrats to Daphne on her upcoming retirement. You've reduced To support your path to non GAAP profitability, can you just talk about the importance of that relative to further bolstering your pipeline and advancing your next gen pipeline programs? Thanks.

Speaker 2

Yes. So the vast majority of our Expenses go towards both the ongoing clinical studies to support the post marketing commitments and remaining Clinical studies extensions in Pompe disease, also manufacturing until recently when now we have commercial products, so that Ends up showing up in cost of goods, but that's the vast majority and then of course the G and A that goes along with that. We do have some modest spend towards the pipeline And we are making, I think, good progress there. I think you should expect to hear us talk more about the pipeline as we come into next year. But you should know that this laser focus on non GAAP profitability does include a modest amount of investment in the pipeline.

Speaker 2

That's an important part of the future of Anakas. And again, we'll talk more about that probably coming into next year. Thank you.

Operator

One moment for our next question. And our next question will be coming from Salveen Richter of Goldman Sachs. Your line is open.

Speaker 12

Hi. This is Srinathra on for Salveen. Thank you for taking our question. First on Galafold, in your view, how much of the growth that you need To get to your prior guidance of $1,000,000,000 peak sales for Galafold will be driven by new patient diagnosis Like genetic screening, etcetera, versus the naive patients are all de diagnosed and switch patients. And on ATGA, if you could provide some more color on the reimbursement process in Germany?

Speaker 12

Thank you.

Speaker 2

Yes. So, a couple of points there. So if you think about just the market today for Fabry, the global market. You've got a little over $2,000,000,000 in global sales. And Here we are sitting at with guidance of kind of $375,000,000 to $388,000,000 If you assume a third to half of the patients on drug today have amenable mutations, then you've got another maybe doubling of the current revenue base just by existing diagnosed and treated patients today.

Speaker 2

So lots of opportunity to continue to switch patients, which is great. Some of that comes through market expansion and some of that comes through We also know if you look kind of globally, the global that Sort of over $2,000,000,000 in global sales represents about 11,000 treated patients and we believe there's Roughly another 5000 or 6000 diagnosed untreated patients. And so again, if you take that kind of third to a half number, that's An additional, call it, 3,000 or so, diagnosed untreated patients who have a mental mutation. So another significant chunk of existing patients today. I think that gets you sort of well towards that peak market opportunity that we've talked about.

Speaker 2

But then as Sebastian and Jeff have highlighted in previous calls, we're seeing Significant growth in the underlying diagnosis, maybe 10% or so a year. And so you put all those together and I think it's easy to see a way towards $1,000,000,000 product opportunity here. And then you had asked a little bit about Germany. Maybe Sebastian, do you want to talk to the dynamics in Germany again?

Speaker 3

Yes. Thanks, Brandeis. So as I mentioned, in Germany, the GBA As classified Pombility as a new active substance, we're very pleased with that. And as a result of that designation, Bombility will undergo benefit assessment under the AMNOD process. We have a 6 month free pricing period.

Speaker 3

And after that, there'll be negotiations on final reimbursed price. So you should expect to see an Agreed upon published price sometimes around Q3 of 2024. We think we've set a Competitive price for the combination of POMBILETI plus Opdivo versus other Pompe therapies available in the German market And the price is again very much in line with the pricing policy that Bradley mentioned earlier on.

Operator

One moment for our next question. And our next question will be coming from Christa Kluska of Cantor Fitzgerald. Your line is open.

Speaker 13

Hi, good morning and congrats on the additional approval this morning and also sending my best to Daphne. I know it's early days in Europe, But can you talk about what have been the biggest selling points in terms of generating interest over other therapies now that you have an approval in place beyond the prep work? So for example, is it the mechanism, the full data set across the different patient populations, open label, a certain endpoint that they're focusing on? Or is it really just a combination

Speaker 5

I'll hit

Speaker 2

the top line and then maybe Jeff Talk about the broader data that we've showed in previous calls. So from a label perspective, Clearly, the most important two data points are the 6 minute walk test and the force vital capacity, which As I mentioned before, we've shown significant differentiation. We're the only therapy that's shown Improvement in those measures in patients who switch from existing ERT to ATGA. And so I think that's a really powerful story and one that Physicians will clearly focus on, but I do think another important part of this is the really broad data set that we've published now in various It won't necessarily show up in the label, but as we continue our medical education strategy, we'll be able to share those. So maybe, Jeff, talk about what

Speaker 4

Yes. Thanks, Brad, and thanks, Krista, for the questions. As Brad noted, the key there is showing the improvement on 6 minute walk in FEC and the switch patients in a controlled trial. But it's really that consistency across endpoints. We've shown some of that previously at a high level.

Speaker 4

We're going to continue to really focus on that here and upcoming conferences just to show the range of improvements that we're seeing across endpoints for these patients. And I'd say the other thing is the emerging durability data as well. We've now shown out to 4 years from our Phase onetwo That the initial improvements observed across naive patients, which patients in those trials have been maintained long term. So we think that that's going to be a continued focus of And a strength so far of what we've seen with ATJ, but really strong core data. I think the MOA It's also something that gives people reason to believe in some of those clinical observations that there is a very differentiated MOA.

Speaker 4

And that's also something that I think we're going to continue to provide publications and more information there as we continue to learn about the MOA.

Operator

And one moment for our next question. And our next question will be coming from Ethan Markowski of Needham and Company. Your line is open.

Speaker 9

Good morning and thanks for taking our question. Just a quick one on the current SG and A spend. So You're currently relying somewhat on the existing sales force for Galafold, but we've definitely seen an uptick in SG and A. Just to give us an idea now that you're rolling out PUMILITY and looking at a U. S.

Speaker 9

Launch, how much more of the SG and A spend increase as we expect in the near term. Thank you.

Speaker 2

Daphne, I'll let you talk to the accounting Treatment that I think is describing a lot of that change. From an infrastructure perspective, what we've said before is we literally We have hired less than a dozen employees globally to support the launch of ATJ. That includes Some Amicus Assist, which is our case management hub in the United States, some patient education liaisons, some direct marketing and medical affairs people, but Hugely leverageable, existing commercial infrastructure, but maybe Daphne talk to the trend That's the question I was speaking to.

Speaker 5

Yes, sure. So I would remind everyone in prior years we had a portion of the support for Yes, both Galafold and now AT GAA in the research and development line, but now as we are aligning resources to support 2 commercial products, some of that spend is now shifting from the R and D line to the SG and A line. So it is a bit of a It's a classification issue when you look at current year versus prior year versus the true increase. Let's put that back.

Speaker 2

Exactly. Yes. Thanks, Daphne. So you should not expect to see significant additional increases in G and A. It was really more of a change in the class for some of those employees, who support the global business.

Speaker 9

Thanks. That was very helpful.

Operator

Thank you. One moment for our next question. And our next question will be coming from Tazeen Ahmad of Bank of America. Your line is open.

Speaker 6

Hi, guys. Thanks for taking my follow-up. Brad, just to Maybe put people's minds at ease. In terms of going back to the GAA question about your timeline for 3Q, just because the PDUFA has officially passed. How are you getting your confidence that they will the FDA will provide an answer this quarter.

Speaker 6

And also as we head into the later part of August, I think the assumption is that the folks at FDA kind of shut down for holiday and So it's listed to September. Is there anything to read into that? Thanks.

Speaker 2

Yes. Good questions. Thanks, Tazeen. We'll provide as much color as we can here. So The confidence really comes from 2 places.

Speaker 2

The first is, if you remember back when we announced the inspection, we estimated that if you look on average, Even though we don't have a specific PDUFA date, on average, it takes about 30 days from the inspection to finish the inspection report, and then it's about 60 to 90 days The agency to complete their review and so we're kind of right in that zone. So we feel very comfortable that it's kind of in the timeline that we've seen when you look on average. And then the other piece that gives us good confidence to your point about whether the FDA is around or not is we have seen in the last couple of weeks an increase in the engagement by the Review division. And that gives us good comfort that they're wrapping up their work. And again, we expect a decision here in Q3, and we're very confident in that.

Operator

And that was our last question. I'd like to turn the call back to Bradley Campbell for closing remarks.

Speaker 2

Great. Thank you everybody for tuning in today and hope everybody has a great day. Take care.

Operator

Ladies and gentlemen, this concludes today's conference. Thank you and have a great day.

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Earnings Conference Call
Amicus Therapeutics Q2 2023
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