NASDAQ:APLS Apellis Pharmaceuticals Q2 2024 Earnings Report GBX 3.25 0.00 (0.00%) As of 04/17/2025 Earnings HistoryForecast Tanfield Group EPS ResultsActual EPS-GBX 0.30Consensus EPS -GBX 0.33Beat/MissBeat by +GBX 0.03One Year Ago EPS-GBX 1.02Tanfield Group Revenue ResultsActual Revenue$199.70 millionExpected Revenue$190.89 millionBeat/MissBeat by +$8.81 millionYoY Revenue Growth+110.20%Tanfield Group Announcement DetailsQuarterQ2 2024Date8/1/2024TimeBefore Market OpensConference Call DateThursday, August 1, 2024Conference Call Time8:30AM ETConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckQuarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Tanfield Group Q2 2024 Earnings Call TranscriptProvided by QuartrAugust 1, 2024 ShareLink copied to clipboard.There are 17 speakers on the call. Operator00:00:00Good morning, ladies and gentlemen. Thank you for standing by, and welcome to Apillus Pharmaceuticals Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. Operator00:00:30I would now like to hand the conference over to Meredith Kaya, Senior Vice President, Investor Relations and Strategic Finance. Please go ahead. Speaker 100:00:42Good morning, and thank you for joining us to discuss Apellis' Q2 2024 Financial Results. With me on the call are Co Founder and Chief Executive Officer, Doctor. Cedric Francois Chief Operating Officer, Adam Townsend Chief Medical Officer, Doctor. Caroline Baumel and Chief Financial Officer, Tim Sullivan. Before we begin, let me point out that we will be making forward looking statements that are based on our current expectations and beliefs. Speaker 100:01:08These statements are subject to certain risks and uncertainties, and actual results may differ materially. I encourage you to consult the risk factors discussed in our SEC filings for additional detail. Now I'll turn the call over to Cedric. Speaker 200:01:21Thank you, Meredith, and thank you all for joining us this morning. We are in a unique position today with 1 and the potential for 2 blockbuster drugs in the market, Cytovari and Empaveni, both of which are making a meaningful difference for patients. Past 6 months have been a period of continued progress and execution by the Aperis team, but we recognize that there around the competitive landscape for SYFOVRI. Given this, I wanted to share some of my thoughts. SYSOVRI is the market leader in a category with only 2 available drugs, 1,500,000 highly motivated patients and a long runway for continued growth. Speaker 200:02:05That said, there has been a lot of focus on near term dynamics. Our competitor has recently had tailwinds driven by factors such as its new J code. They had every incentive to drive demand in new patient starts as much as possible, and yet we saw approximately half of new patients choose safe ovary. Following last month's successful ASRS meeting, we believe SYFOVRI's clinical profile is being viewed favorably by physicians and will drive more growth in new patient starts over time. The SYFobri launch has been one of the best launches in recent history, generating over $500,000,000 in sales in its 1st 6 quarters and achieving double digit percentage growth every single quarter. Speaker 200:02:52More than 330,000 XIFAVRI injections are estimated to have been administered to patients and this strong growth is continuing into the second half of the year. The GA market is growing significantly and SAIFORRI has only scratched the surface of its long term potential. Importantly, the recent ASRS meeting was a strategic turning point for us, where our focus and our discussions shifted to SYCLOVRI's strong and differentiated efficacy profile. We have multiple analyses supporting the efficacy of SYFOVRI and retina doctors are enthusiastic about the totality of these data. The favorable benefit risk profile of SYFOVRI is becoming clearer to physicians with some key takeaways. Speaker 200:03:431, both monthly and every other month's SYFOL retreatment showed a better efficacy profile than the competitor among patients with non subfovial GA at both 12 24 months as detailed in the matching adjusted indirect comparison post hoc analysis presented. Note that no head to head clinical trials have been performed. 2, SYFOVRI is clinically proven to offer flexible dosing from day 1. Every other month's treatment with SYFOVRI provides an even safer and more cost effective treatment, while maintaining its strong efficacy. And 3, regarding safety, vasculitis is rare and appears to be a first injection phenomenon. Speaker 200:04:31The estimated rate has remained stable at 1 in 4,000 per first injection. During the podium presentation at ASRS, the REST committee confirmed this estimated rate as agreed that it appears to be only on the first injection. After this meeting, we continue to believe that we are well positioned to continue growth and further cement our market leadership in GA for many years to come. Our singular focus is to ensure that every GA patient who needs treatment has access to SYFOVRI. This is how we expect SYFOVRI to continue on its path of becoming a multibillion dollar drug. Speaker 200:05:13As for the European GA opportunity, we are focused on the CHMP reexamination process and are encouraged by the progress we made throughout the initial review. This was not an unexpected outcome given that the process was reset back to day 180 of the initial review and therefore led by the original rapporteur. We were encouraged to learn that in this recent opinion, multiple CHMP members disagreed with the negative opinion. Additionally, the external advisory experts were aligned on microproprietary as the best available functional measure of GA. We are humbled by the broad support shown by the European retina community. Speaker 200:06:01And while we remain conservative in our expectations for the reexamination, we believe we are well positioned heading into the appeal. 2 new rapporteurs were recently designated and we continue to expect the final decision to be issued in the Q4 of 2024. Moving to Empaveri, which continues to elevate the standard of care for patients with PNH. Empaveri generated $24,500,000 in product sales in the Q2. We continue to believe that patients on Empaviti are experiencing substantial benefits as demonstrated by its 97% compliance rate. Speaker 200:06:43Importantly, we are exploring its potential to expand into new indications and become a best in class treatment option for additional high unmet need areas. The upcoming Phase III Valiance top line readout in C3 gs and primary ICMPGN is the next milestone in this process. And we expect to present these data later this month. If the data are positive, we plan to submit a supplemental NDA to the FDA for approval. Regarding the pipeline, we are advancing multiple earlier stage development programs, leveraging our core expertise in complement science to fuel the next phase of value creation for Aperis. Speaker 200:07:28We look forward to sharing our progress at an upcoming Investor Day towards the end of this year. And finally, from a financial perspective, we are benefiting from the growing product revenue generated by SYFOVRI and Empaveri and has actively taken steps to strengthen our balance sheet. We now have a clear line of sight to positive cash flow, allowing us to invest in future growth without having to rely on the capital markets. Before I turn it over to Adam to discuss our commercial activities, I will close by saying thank you to the patients and physicians who motivate us to develop and bring important treatments to market and to the Aperis team who have shown unbelievable commitment and perseverance in getting these important medicines to patients. And to our shareholders, many of whom have stood with us through these dynamic periods and provided unwavering support to us over the years. Speaker 200:08:29With that, I will now turn it over to Anne. Thanks, Cedric, and good morning, everyone. I will begin with Xiphobri. With revenue of about $155,000,000 Speaker 300:08:41sales growth remains strong at more than 12% quarter over quarter. In the 2nd year of our product's launch, quarterly growth rates at these levels are a strong indicator of longer term demand. We delivered over 79,000 commercial doses and approximately 5,000 samples of SYFOVRI in the 2nd quarter. Demand continued to accelerate with June being our highest demand month since launch through the Q2. We are particularly pleased to see the continued progress across the many factors driving growth, including new patient demand and a broadening prescriber base. Speaker 300:09:24Cedric mentioned some of the competitive dynamics, which I know is on everyone's mind. So let's start there. Our competitor had recent tailwinds driven by factors such as obtaining its new J code. And so it is expected that they would see their proportion of new patient share accelerate. We also saw an acceleration when Xiphobri's J code went into effect last October. Speaker 300:09:51However, we do not believe this is indicative of longer term market dynamics. We have taken the long view on contracting as we believe this is a large and growing market and believe that discounting too aggressively now is unsustainable and will lead to price degradation over time. We are also executing our strategic plan in the field to reinforce XIFAVI's benefit risk profile. Xifovri remains the number one chosen treatment for GA with approximately 75% of the treated market as defined by the total number of patients treated. We believe XIFA Re's position as the market leader will continue to be driven by its differentiated efficacy profile and flexible dosing. Speaker 300:10:42Importantly, we are also focused on maintaining market leadership whilst growing the overall GA category. We are still in the beginning stages. Our estimate based on claims data is that about 13% of GA patients who have been diagnosed and are managed by an eye care professional are currently being treated. In addition, only a small portion of newly diagnosed and treated patients are referrals, meaning that most patients currently receiving treatment were already being seen by a retina specialist. This suggests that the majority of GA patients have not yet been diagnosed or referred to retina specialists, reinforcing that we have only scratched the surface of the large opportunity for XIFAVI. Speaker 300:11:33As I mentioned on our last earnings call, we are now executing the next phase of our commercial and medical strategy. After the ASRS meeting in 2023, we developed a 2 phase strategic plan with a 2 year timeline. Phase 1 was focused on being transparent and educating the retina community about everything we were learning at the time around safety. This past quarter, we shifted to Phase 2 of the strategy, which is focused on strengthening our leadership in this growing market. More than 2,100 sites of care have ordered SYFOVRI. Speaker 300:12:11We are now on our front foot, expanding the number of new physicians using SYFOVRI, deepening our relationships with existing SYFOVRI users, establishing strong payer access and reimbursement and increasing awareness and education for patients. With physicians, we are communicating a clean and simple efficacy message, highlighting Xiphobary's increasing effects over time, which is critical given that GA is a chronic disease. We are also sharing the microparametry data from the Gale extension study, the only data for an approved GA treatment that demonstrates a visual function benefit in a pre specified endpoint. This allows for a productive benefit risk discussion with the every other month dosing option having a dramatically positive impact for patients, doctors and payers. We had a successful ASRS meeting a few weeks ago, our first big retina meeting leading with these messages and look forward to the upcoming 4 congresses. Speaker 300:13:20We are also continuing to broaden our reach to more retina specialists as well as other referring eye care providers who see tens of thousands of GA patients. Reaching these physicians and educating them on the referral process are key to developing the GA market. With payers, we have secured unprecedented and broad coverage for patients choosing Xiphobri. We're thrilled to share that 2 large national pharmacy benefit managers have recently made SYFOVRI the only preferred treatment on their commercial formularies. As the preferred product, this means that the new patients with commercial insurance will have full access to XIFAVIRI as the first line treatment and an exception process will have to be undertaken for non preferred or disadvantaged products. Speaker 300:14:16While payers have several considerations in making such decisions, we believe these decisions were driven by XIFABRI's compelling value propositions, highlighting its robust efficacy with increasing effects over time and both monthly and more importantly every other month dosing. These two PBM decisions are important milestones demonstrating payers' strong belief in XIFAVI's clinical and economic value proposition as ensuring broad coverage and seamless reimbursement is critical for retina specialists. And with patients, we've launched the first phase of our branded DTC campaign in the spring, which is focused on encouraging patients to talk to their physicians about GA treatment with XIFAVIRI. This is a very large market and we will be methodical in executing this next phase in order to set ourselves up for the long term. We will continue to execute flawlessly and be focused on getting more doctors, patients and payers to understand the efficacy and the benefits that the leading GA drug can deliver. Speaker 300:15:40Now let me shift to Emperveli. In the Q2, Emperveli generated approximately $24,500,000 in U. S. Net product sales. The positive trends across the key leading indicators for the PNH patient population continue into 2024. Speaker 300:15:59Specifically, compliance rates remain high at 97% and we continue to have a very strong safety profile. As we previously said, with the availability of an oral treatment for PNH, we are facing a more competitive market and expect sales to be flat at least through the next 6 to 12 months. We continue to have new patients starting in PIVELY treatment, but this has been offset by some patients switching to an oral. Finally, I will echo Cedric's enthusiasm regarding the opportunity to potentially expand Empelli into C3g and ICMPGM. This market is approximately 3 times larger than the PNH market and there are no available treatments. Speaker 300:16:46If Empovelly is approved in these indications, we are confident that we can leverage much of our existing infrastructure to rapidly reach nephrologists and deliver empaveli to the thousands of patients suffering from these diseases. With that, I will now turn the call over to Caroline. Caroline? Speaker 400:17:07Thanks, Adam, and good morning, everyone. We are looking forward to sharing the Valyant data later this month. I'll talk more about this opportunity in a minute. I will first talk about SYFOVRI as our team was recently at the ASRS meeting in Stockholm, where we had a significant presence with 5 oral presentations, including a late breaking abstract on visual function from Gale. We are particularly excited by these visual function data as this was the first time a geographic atrophy treatment had demonstrated a visual function benefit on a pre specified analysis. Speaker 400:17:49Results showed that with respect to the microperometry endpoint, patients treated with pegzetacoplin monthly or every other month developed fewer new scotomatous points over 36 months compared to patients from the sham crossover group. Scotomatous points measure the areas of the retina that have lost all light sensitivity and therefore are no longer functioning. These results add to the largest body of evidence for our geographic atrophy treatment and reinforce the unprecedented effects shown by SYFOVRI to both meaningfully slow geographic atrophy lesion growth and by doing so preserve visual function. ASRS is one of the most important retina meetings of the year. And we had the opportunity to engage with many members of the retina community. Speaker 400:18:46This was a highly successful meeting for XIFAVRI and we heard repeatedly from doctors about its differentiated benefits. We look forward to continuing to engage with this community at upcoming meetings and to share the ongoing progress of SYFOVRI in patients with geographic atrophy. Moving to Empivelli. Later this month, we expect to share top line results from our Phase 3 VALION study of pegzidacoplin in people living with C3g and ICMPGN, 2 rare and debilitating kidney diseases caused by uncontrolled complement activation and breakdown of C3. Patients are usually diagnosed in adolescence and about 50% advanced to end stage kidney failure in 5 to 10 years. Speaker 400:19:38Treatment options are generally a kidney transplant or lifelong dialysis, neither of which are curative. In fact, nearly 90% of transplant patients experience disease recurrence and about half of them end up losing their transplanted organ. The Phase 3 VALION study enrolled 124 patients with either C3G or primary ICMPGN. This is the largest single trial conducted in these populations and the only Phase III study to enroll a broad population inclusive of adolescent and adult patients with native and post transplant forms of disease. The primary endpoint of the VALION trial is a log transformed ratio of urine protein to creatinine ratio or uPCR, a key marker of disease progression in all patients at week 26 compared to baseline. Speaker 400:20:39We view success in this trial as the achievement of a statistically significant response to the primary endpoint as well as positive effects in some of the additional secondary endpoints. Physicians have shared that this would be clinically meaningful for these patients. If Valyant is positive, we plan to submit the supplemental NDA to the FDA for approval. Following the completion of the VALION study, patients were given the option to enroll into the VAIL long term extension study. We were highly encouraged to see that 100% of the patients who have already completed Varian have now enrolled into VAIL. Speaker 400:21:25Beyond the Valyens study, we are continuing to advance our earlier stage pipeline, such as our C3 siRNA that is currently in Phase 1 development and our Beam collaboration. Like Cedric said, we are excited to share more details about our pipeline programs with you at an Investor Day later this year. I will now turn the call over to Tim for a review of the financials. Speaker 500:21:53Tim? Thank you, Caroline. I will now provide an overview of our financials and some comments on our debt refinancing with Sixth Street. Additional details are available in the press release that we issued earlier this morning. Total revenue for the Q2 of 2024 was approximately $200,000,000 including $155,000,000 in CYPOVRI and $24,500,000 in Empovella U. Speaker 500:22:15S. Net product revenue. This compares with $95,000,000 in total revenue in the Q2 of 2023. Turning to the rest of the P and L. For the Q2, cost of sales was $23,000,000 R and D expenses were $78,000,000 SG and A expenses were $128,000,000 and we reported a net loss of $38,000,000 As I previously stated, we are realizing efficiencies this year related to our restructuring in 2023 and continue to expect our total operating expenses in 2024, inclusive of R and D and SG and A expenses, to be less than our total expenses in 2023. Speaker 500:22:55This year, we've been focused on strengthening our balance sheet. These efforts ultimately resulted in a strategic non dilutive refinancing collaboration with Sixth Street that we announced in May. The deal allowed us to prepay our FFJ debt at a significant discount and to free up substantial cash flow. A quick look at the terms reveals how favorable this deal was. 1st, this debt facility provides us with up to $475,000,000 of which $375,000,000 became available immediately upon closing. Speaker 500:23:26We can access the remaining $100,000,000 at our option over time. Importantly, this deal was debt neutral to Apellis. We replaced $366,000,000 in payments due to SFJ over the next few years with $375,000,000 from Sixth Street. The principal repayment is pushed out to May 2030 and Syphobia revenues are expected to be closer to peak. Our payments are interest only until then. Speaker 500:23:53This deal also substantially improves our liquidity and provides flexibility to access at least $200,000,000 in incremental non dilutive capital as we continue to invest in profitable growth. And it includes a record low credit spread. The overall terms were some of the best in biotech seen in recent history. In aggregate, since the beginning of the year, we have unlocked over $475,000,000 in non dilutive capital, including $100,000,000 from the Cap Call unwind announced in the Q1. Plus, we have the flexibility to bring in $100,000,000 to an accounts receivable line, which can be increased to $200,000,000 upon the achievement of certain milestones and $100,000,000 more from Sixth Street, so a total of $775,000,000 in non dilutive financial flexibility. Speaker 500:24:42This combined with the $360,000,000 in cash and cash equivalents that we had at the end of June 30, 2024 puts us in a strong financial position where we are on a path to becoming cash flow positive and no longer having to rely on the capital markets to fund the business. Importantly, our ability to begin generating cash is possible in both the EU and non EU scenarios. While we believe the opportunity in Europe is significant, the ramp to peak sales is much longer and so the main source of profitability in the near term remains growth in the U. S. I will now hand the call back over to Cedric for closing remarks. Speaker 500:25:18Cedric? Speaker 200:25:19Thanks, Tim. We've had a very strong first half of the year. With 2 successful commercial products, a pipeline of innovative programs in development and a strong financial position to support the business, I am more confident than ever in our ability to continue creating significant value for our patients and our shareholders. And we will now open the call for questions. Operator00:25:44Thank Our first question is going to come from the line of John Miller with Evercore. Your line is open. Please go ahead. Speaker 600:26:11Hi, guys. Thanks so much for taking the questions. I would love to start with I'll start with this. Do you expect the share of new starts currently around that 50% mark to grow again post a successful ASRS? And then I guess the corollary to that is your guidance to cash flow positivity, you just mentioned doesn't assume anything more than U. Speaker 600:26:35S. GA launches, but does it assume more than the existing share of new starts in the U. S? Speaker 200:26:47Thank you so much, John. Great to hear you. So that is, of course, the most important question, right? I mean, is the new starts. In the Q2, as we have discussed, there were tailwinds for IZURVE. Speaker 200:27:03But as we now move forward, what really stands out and what is very encouraging to see is the very large market and the fact that Xyphovir is leading on efficacy, flexible dosing and economic value. So as we move forward now, we plan to recapture the lead on those first injections and take advantage of this very large market with an important unmet need. Adam, do you want to add? Speaker 300:27:29Yes. Thanks, Patrick. Hey, John. So yes, we're in Phase 2 and we're already encouraged by the growth and the demand we're seeing into July. We're on the front foot. Speaker 300:27:40We're talking about efficacy. We're talking about every other month dosing. These are huge differentiating factors for this great drug. We can see the future and we can see that we will continue to be the number one GA drug in this market. Speaker 200:27:55Tim, do you have any questions? Yes. Speaker 500:27:57So in terms of cash flow, our revenue was $199,700,000 and our cash OpEx, if you take out stock based comp and depreciation, it's just under that. So that was 199 $199,000,000 a little bit less than that. So really on a total OpEx basis, on a cash basis, we are net neutral. So the differences right now are working capital and of course interest expense. So it really doesn't take much in terms of growth for us to become cash flow positive. Speaker 500:28:26We're not guiding to when that will happen. But given the size of the market and the growth in this market, I don't think that's something we worry about. Speaker 600:28:39Great. Makes sense. And I guess my follow-up would be your language on EU approval seems more positive now than it has in the past. You mentioned that you're well positioned heading into this appeal and I think that's a little bit more positive than the previous messaging we've heard where we're all assumption all of our assumption was that this was not Speaker 200:29:04the base case. But how do Speaker 600:29:05you feel now versus how you felt the last time you had into an appeal? Do you really feel like the likelihood of an approval without further trials or without further resubmission is much higher now? Speaker 200:29:19Thank you, John. So the expectation should remain the same. What is of course, the one nice takeaway from the fact that this procedure was reset was the ability for us to introduce new data and that includes the pre specified endpoints assumption, which is of course something really important and encouraging and really speaks to the appeal of this drug to patients. So again, in terms of expectations, that has not changed. The process has gone according to plan. Speaker 200:29:49We've been disciplined and we look forward to the 4th quarters to share what the results are. Speaker 500:29:57Thanks so much. Operator00:29:59Thank you. And one moment as we move on to our next question. And our next And our next question is going to come from the line of Anupam Rama with J. P. M. Operator00:30:10Your line is open. Please go ahead. Speaker 500:30:13Hey, guys. Thanks so much for taking the question. You guys noted that for SYFOVRI, June was your best Speaker 200:30:19month since launch. Maybe you could give us Speaker 500:30:21a little more color on what you were seeing on a month by month basis in the quarter. Was the IZARRAY sort of J code impact more like first half of the quarter dynamic and then you saw reacceleration of CIFO regrowth or how do we think about like what the dynamics were within the quarter? Thanks so much. Speaker 200:30:42Thank you so much, Anupam. I will hand it over to Adam, but I think again what stands out here and what we're super excited about is how large this market is, the fact that it's growing, the fact that AZERVATE does well in a duopoly that will be here for a long time and us having a drug that is meaningfully differentiated on efficacy and dosing flexibility, that is really what we are focused on. But Adam, you may want to add something. Speaker 300:31:08Yes. Hey, Adam. So yes, June was the highest month of the quarter and also the highest month launch today. Across multiple metrics, we saw that Q2 was a very successful quarter for us across multiple months, right? We continue to grow accounts, now getting to 2,100 sites of care. Speaker 300:31:29We saw double digit growth for the quarter. We're fully into Phase 2 of our plan. And I think some of the initial steps of that happening in June is what we can witness there, right? Talking about efficacy, talking about flexible dose, and I think that's what we're really pushing hard as we now move to the next quarter. Speaker 500:31:51Thanks so much for taking the question. Thank you. Operator00:31:56And one moment as we move on to our next question. And our next question comes from the line of Salveen Richter with Goldman Sachs. Your line is open. Please go ahead. Speaker 700:32:08Hi. This is Srinathra on for Salveen. Thank you so much for taking our question. So on the competitive dynamics, what are the factors which are driving the competitive and physician dynamics in the GA market following the permanent J code for IsoVE? And could you speak to the market share that you're seeing at this point and how you expect that to evolve over the near term? Speaker 200:32:35Thank you so much for that question. So we are the market leader. We plan on continuing to be the market leader and that confidence is based on stability around the safety, which was really important and where ASRS was a real turning point for us, right. For those of those that were there, it was a quiet meeting on that front and the discussion is very much shifted towards the efficacy profile. There the majority of doctors clearly see the differentiation of safe ovary versus the competition. Speaker 200:33:04So as we now move forward, the focal point will more and more become efficacy, the differentiation, the long term data, the mass amount of data that we have with CICEFOVRI and then the real and important benefit of every other month dose 6. So the convenience that that offers to patients, also the fact that helps the number of intravidional injections is twice as safe as monthly injections. All of these things are going to come more into And Adam, if you want Speaker 500:33:34to add something. Speaker 300:33:35Sure. Yes. So obviously, if you go back to our J code, we also notice tailwinds when we had our J code unlocked certain new accounts. So the competitor had some tailwinds. And even with those tailwinds, we maintained approximately 50% of new starts and market leadership at 75% of the total market. Speaker 300:33:58That is down, as Cedric said, to a real successful execution of Phase 2 of our strategic plan plus some positive comments moving forward from ASRS. Now you also asked about market share. So we track market share based on vials going into physicians and then being injected into patients. And so we think that's the most robust way of measuring market share, and we had a 75% market share. Now, as this market grows, we will continue to push incredibly hard on our efficacy message, our dosing convenience and the economic value. Speaker 300:34:36And we think that, that will maintain our leadership moving forward. Speaker 700:34:43Really helpful. Thank you. Operator00:34:46Thank you. And one moment as we move on to our next question. And our next question comes from the line of Yigal Nochomovitz with Citigroup. Your line is open. Please go ahead. Speaker 800:35:00Hi, great. Thank you very much for taking the questions. Shifting over to CTG and ICMPT N, I just wanted to get your thoughts on how you expect the position type for the coplan in this market, assuming valine is positive? And what do you think you need to show on proteinuria as well as some of the other secondary endpoints that Caroline mentioned to be competitive with the emerging oral option. Speaker 200:35:31Okay. Yes. Sorry, Yigal. We had a hard time hearing you here. Tim, who has explained hearing for me. Speaker 200:35:39So, look, we are very excited about the opportunity in C3GNIC MP Gen as you know. This is something that has been a little bit below the radar screen of most, but a really large and important opportunity for us. We have seen the results from the NOBLE study where we have the histopath data, which is really best in class ever seen within this disease. We also have already while this drug is not on the market yet seen the excitement around science for this drug. And we have seen in the NOBLE study approximately 50% reductions in proteinuria. Speaker 200:36:19So that is of course the goal for us is to meet statistical significance on the primary endpoint and then to really pay attention to the transplanted population. So, yes, I hope that answers your question. Speaker 800:36:35No, that's helpful. And then I guess another question in terms of the design of Valyant. We are combining C3G and ICMPGN into one study. Obviously, the competitor is doing separate studies for both indications. Do you see that as being a significant difference in terms of how physicians will interpret and implement the data when both of those are approved? Speaker 200:36:59Yes. That will depend on the data, right. So I think you bring up a very important point, which is that the way in which the study reads out should be viewed in the context of, of course, what we have seen with XAVELTA. We decided to include in one study both C3G and ICMPGN with the hope that the data would be good enough for both to find their way into our label. So we're going to see if that's the case or not. Speaker 200:37:24And we're going to see how the data stacks up against what has already been disclosed by Novartis in the past Speaker 800:37:32months. Great. Thank Speaker 900:37:34you. Thank you. Operator00:37:36Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Steve Seedhouse with Raymond James. Your line is open. Please go ahead. Speaker 1000:37:50Thank you. Good morning. Thanks for the update. First question, I just regarding new line item on the balance sheet for long term inventory at $23,000,000 entry. Has there been any change to the expected sales trajectory in the next 12 months versus prior? Speaker 1000:38:06Are you anticipating that entry will be gone in subsequent quarters or is it going to grow? And then also what is the shelf life of the raw materials, I guess that comprise that entry? Speaker 500:38:18Yes. Thanks, Steve. So that entry was put in place because we have to do our ordering for our inventory long in advance and we had planned for the potential success of ALS. There's also a couple of other factors, which include the delay in the EU for Cypropri and also our expected ordering from Sobeys. So we have the plan for all that well in advance. Speaker 500:38:43And so much of that, in fact, most of it has to do with Infiniti. So we don't know exactly how long that line item will last there, but most of that inventory has a shelf life of 3 years or more. So we just put that in place because of the dynamics we talked about, but it's primarily in the value. Speaker 1000:39:06Okay. Good to know. And then just on the dynamic of patients maybe switching between Eiservate and Cyfovirate, has that do you have good visibility into both directions of switching there? And has it been if so, has it been sort of a net positive, net negative or net neutral in terms of unique patients on either drug? Thanks. Speaker 300:39:31Hey, Steve, it's Alan. So yes, we have some visibility to that now, obviously, with all analysis that we can do, it's only a subset of the total market. So obviously, last year, we did see some switching from cyfobri to ISOVATE. We saw 1 or 2 accounts switch the majority of that patients. And what we have seen moving forward is we've actually seen some switching from iZovate come back to Cyfovary. Speaker 300:39:59And our assumption there is that's based on the efficacy and the flexible dosing of this drug. Switching tends to be a very small piece of the market, and it goes both ways based on our data set. As we look forward into Q3 and beyond, right, we're really, really encouraged by all of the metrics we're seeing about strong demand across multiple metrics. That includes switching as a piece of it, a small piece of it. That includes new starts and our plan to execute everything to push new starts. Speaker 300:40:33It includes more physicians writing cyfobri for the first time and increasing the number of accounts Speaker 200:40:40that are using cytovery. Speaker 300:40:41We're really, really positive on what we're seeing so far. And we think a lot of that's down to this strong efficacy, the leading efficacy, flexible dose and economic valve. Hopefully, Steve, that answers your question. Yes. Speaker 1000:40:56Thanks so much, Adam. Thank you very much. Operator00:41:00Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Colleen Koozie with Baird. Your line is open. Please go ahead. Speaker 100:41:12Great. Thanks. Good morning and thanks for taking our questions. Can Speaker 400:41:16you provide any thoughts on when you might provide revenue guidance for Cypropri? Speaker 500:41:23Sure. Thank you. So obviously, we're not providing it for the remainder of this year and it's something we'll reconsider for next year, but we're not guiding on the guide yet. Speaker 100:41:33Thank you. And then for the EU review, I think Speaker 400:41:36you said the repertoires have been selected. Can you provide any commentary on the background of the new repertoires and if either of them were a dissenting voter from the Speaker 100:41:45most recent review? Speaker 200:41:48Thank you so much, Colleen. So we don't provide details on that. As mentioned, we consider the odds of success to have remained stable, the process to have gone very much in line with what we had expected. And hopefully, in the Q4, we'll be able to come back with positive news. Speaker 100:42:07Understood. Thanks for taking our questions. Speaker 200:42:10Thank you, Pauline. Operator00:42:11Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Phil Nadeau with TD Cowen. Your line is open. Please go ahead. Speaker 900:42:22Good morning. Thanks for taking our questions On the competitive environment, first, I had prepared remarks and then I mean, maybe a couple of more about what you're seeing from your competitors in terms of cash and a little bit more about pelletives on strategy and accounting. And second, the dynamics of the competition, what are you seeing the position in center level overall? Are students becoming iSurvey versus iSurvey position using both and centers that are 1 versus the other or are they using both? If they're using both, how are they using patients? Speaker 900:43:02Thanks. Speaker 200:43:03Hey, Phil. I don't know if it's Arlen or yours, but we have a very hard time hearing your question. Speaker 900:43:10Sorry, let me try again. Yes. So first on discounting, what are you seeing in the marketplace on discounting and what is a pellet's own strategy on discounting? And then second, on competition, can you talk about on the patient sorry, on the physician center level, are centers choosing 1 or the other or are they going patient by patient using either way versus seboprene? Thanks. Speaker 200:43:33Thank you so much. Adam, do you want to take that? Speaker 300:43:35Yes. Hey, Bill. Thanks for repeating the question. So contracting is obviously a standard process in this market, and we're taking a really strategic and thoughtful view on how we contract in this market. This is a large and growing market, and we've only just scratched the surface of moving patients into the market. Speaker 300:43:58So if you look forward to how big this market could possibly be, we want to maintain as much value as is possible. So we've been incredibly thoughtful on contracting. Then to your second part of your question. So at an account level, right, we have seen that there are many SIFO re advocates and fans. And these physicians are choosing SYFOVRI for its leading efficacy, flexible dosing, its now well documented safety profile and the robust real world evidence. Speaker 300:44:34And that comes consistently when we interact to its physicians various other interactions too. Now no surprise, there are always some competitor physicians also who tend to be choosing the competitor for its safety profile. One thing we have noticed, and I don't know if Caroline wants to comment afterwards is, a lot of physicians will have a discussion about, cyfobry, for example, with their patient and explain the efficacy profile and the flexible medicine. And some physicians will have the same conversation on either. So the patient voice is also important in this discussion and we truly believe that efficacy will drive patients to want to choose software. Speaker 300:45:19Caroline, anything you want to add? Speaker 400:45:22Thank you. Hi, Phil. I think when it comes to physician use, we just had an ad work yesterday and speaking with my colleagues at ASRS, they're very driven to have less than monthly dosing, which is consistent with the high efficacy. And they're really also driven by our data that goes into 3rd year of use that patients have completed the Gail study, some patients with over 5 years of continuous use of Cyprobary. So to them, the most important thing is to give the maximum efficacy with the least burden for patients. Speaker 500:46:03That's helpful. Thank you. Operator00:46:06Thank you. And one moment as we move on to our next question. Our next question comes from the line of Akesh Tewari with Jefferies. Your line is open. Please go ahead. Speaker 400:46:18Hey, this is Amy on 3rd cost. Thanks so much for taking cost. So you've alluded to a safety update second half of this year. Just wanted to get a sense of what that could entail. Also given Eiservate has half the amount of PEG and a shorter half life compared to Cybovir, are you working with ASRS and other doctors to run studies looking at dose titration or spaced out dosing regimens for cyfovirate? Speaker 400:46:43And when can we get an update on that? Speaker 200:46:47Thank you so much for that question. So first of all, the safety is now very clear and well established. So the what was really important for us was at ASRS that the ASRS REST Committee agreed with Aperis on the rarity of these events, 1 in 4000 on the first injection and the fact that this is primarily a first injection phenomenon, right. So those are important facts. And of course, then you place it in the broader context of the safety where CyFovir stacks up very well against IZURVE specifically also because of that every other month dosing that is available. Speaker 200:47:23So based on an enormous denominator of 330,000 injections, we know very well what the safety profile is. I don't think there's going to be much more discussion around that. What we will talk a lot about now is what the efficacy really looks like. And I think that is where the discussion is going to go. What was really gratifying to see coming out of ASRS is that everything is becoming more quiet and more recent within this field. Speaker 200:47:52So only 13% of patients with GA right now have been treated. These patients are desperate for treatment. They are going blind, understanding the safety profile and the efficacy that they get in return is really important and is going to drive the growth of this market for many years to come. So that is something that really stood out. In terms of mitigations for something as rare as this event, it is a question what can you do, what should you do. Speaker 200:48:19It's of course, when it happened, it's not good. But intravitreal injections carry a risk. Every time you do an intravitreal injection, there's a chance of 1 in 3 to 5,000 of getting infected in ophthalmosis as well. That is normal with any type of drug. So this is really something that we're looking forward to. Speaker 200:48:37I don't know if Caroline wants to add something. Speaker 400:48:40I think the retina community has really appreciated our transparency with this and our partnership. I mean, we are driven by science and we're driven by what's going to be best for patient care. And that is the continual feedback. And I will tell you that the community would have no problem giving different sort of feedback if that was indicated. So they're really pleased with this. Speaker 400:49:04And they're really excited to continue to work with us and develop more data for our patients to give them the best care. Speaker 200:49:11Yes. And we're really feeling that momentum this quarter, right. I mean, it's really I think SRS was a real turning point for Speaker 400:49:20us. Great. Thank you so much. Operator00:49:23Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Ellie Marie with UBS. Your line is open. Please go ahead. Speaker 1100:49:34Hey guys, thanks for taking the question. Just a quick one on cyphobray and then a question on Valeant. Sorry if I missed this before, but can you confirm if volumes were up in July versus June for SYFOBRII? And then, for VALYANT, just how are you thinking about what's clinically meaningful in the pre versus post transplant setting? And then any difference in efficacy expected between these two settings? Speaker 1100:50:01And just commercially, how you're thinking about the relative size of the population opportunity for pexadacopalan in the pre versus post transplant patients? Thanks. Speaker 200:50:13Thank you so much. Adam, Adam, do you want to take the first question? Speaker 300:50:15Yes. So we're really thrilled with the strong growth because it's continuing into July and we expect it to continue for the rest of the quarter and onwards. We're seeing it across multiple metrics and I think it's down a lot to flawless execution of Phase 2 of our plan. We are now on the front foot and we're pushing hard. So we're thrilled with what we're seeing into July. Speaker 300:50:39We expect that to continue. We're going to work hard to make sure. Speaker 200:50:44And then as it relates to Valyant, so pre versus post transplant. So as you may recall, Elide, for us, the post transplant segment is a very intriguing one because it's easy to take biopsies and to track on histopathology what your drug does in that population. It is also a population that was kind of deprioritized by our competitors and it's one that we happily embrace because what is best for a transplanted kidney is best for kidneys with this disease period. So this is really something that has many advantages for us to focus on. But on the other hand, should our data be really good in Valient, there is a real opportunity to differentiate from fabalta and in a disease as serious as C3G or ICMP efficacy is what will really, really matter more than convenience, right? Speaker 200:51:36Whether you take a pill or subcutaneous, if you have a real differentiation on efficacy, that is what will stand out. I also want to point out, of course, we've always talked about the remarkable safety profile that we've seen in PNH and the other indications where Empevy has been used and is on the market, combined with this extraordinary compliance rate of 97%. Empaveri just the same active ingredient that Ciforvary is an amazing drug and hopefully in Valient we will see a new indication emerge for that drug. Speaker 1100:52:09Okay, great. Thanks. Operator00:52:12Thank you. And one moment as we move on to our next question. And our next question comes from the line of Annabel Samimy with Stifel. Your line is open. Please go ahead. Speaker 1200:52:25Hi, all. Thanks for taking my call. So I guess in our channel checks, we're happy to find that consensus among these physicians we spoke to is generally in line with your comments that physicians give SYFOVRI that edge on efficacy. I guess my question is, how are they responding to the microprimatory data? Because it's not something that they typically do in their offices. Speaker 1200:52:44So how can they use that with their patients practically so they can show patients benefit over time and keep them motivated? And I ask that, I guess, for retention beyond that, say, 18 months to 2 year timeframe where patients may start dropping off. Do they have the tools right now? And are they starting to adopt some of these tools so they can demonstrate to their patients that this is working? Thanks. Speaker 200:53:13Thank you, Annabel. Adam is going to first answer the first question. Yes. Speaker 300:53:16Thanks Annabel. So I appreciate your comments on efficacy. We also did a recent piece of market research and we noticed in our sentiment to our market research that our efficacy perception is increasing and there's a gap between us and the competitor in our market research. So it seems to confirm what you said. I'll hand over to Caroline on micro Speaker 400:53:39Thank you, Adam. Physicians are really excited about the microproprietary data. And in showing them, they see the trend in the microprimatory data that's followed over time and that it reaches this pre specified endpoint. I think that most physicians realize that microproprietary in many ways is analogous to a visual field testing. And they appreciate that it shows benefit in a clinical trial. Speaker 400:54:09But in the real world, they like to use OCT, which also has shown benefits using our AI algorithms combined with the University of Vienna. So I think the fact that we have this pre specified endpoint though is very highly meaningful and it will mostly be used to date in clinical studies, although some people are using micropermatria in the real world. In the real world, we can use imaging to show this to patients and we have cases that we've shown to physicians. In fact, we showed one at ASRS where a patient in the observed fellow eye, the geographic atrophy grew 3x as much compared to the treated eye. So cases like this are highly meaningful and that was in Matt McCumber's video talk at ASMS. Speaker 1200:55:04Great. Thank you. Operator00:55:06Thank you. And one moment as we move on to our next question. Our next question is going to come from the line of Francois Brisebois with Oppenheimer. Your line is open. Please go ahead. Speaker 1300:55:19Hi. Thanks for the question here. So I was just wondering, so in terms of function we've discussed, but on convenience and the importance of that and the economic value, can you help us understand a little bit from the convenience, is that as advantages to the physician as it is to the patient? I'm just trying to understand if convenience and economic value here have a correlation or not. Speaker 200:55:44Thank you, Francois. Well, there's 3 pieces to that question, right? There's the convenience to the patient, convenience to the physician and then the convenience quite frankly to the payer. So when we start with the convenience to the patient having every other month dosing available is really, really good. Our competitor, sure there is some off label use with every other month, but our competitor has only monthly. Speaker 200:56:09We're going to find out at the end of this year if they actually ever get every other month in their label. This is a huge point of differentiation that we will benefit meaningfully from should it end up the way we think. The advantage to physicians of every other month is again the flexibility. And I'm going to let Caroline answer like her view on that and then have Adam dive into the payer aspect of the value? Speaker 400:56:39Well, certainly to realize the anatomic benefits of Cyprovary, we've seen that every other month dosing is meaningful. And I think that with our flexible every 25 to 60 days in our label, patients can come every 6 to 8 weeks and still realize these meaningful effects. And certainly in the U. S, physicians love to have that plusminus 1 to 2 weeks with their dosing. And it's more likely for patients to come in and complete this. Speaker 400:57:11We know that with monthly dosing from our anti VEGF experience, it's really very, very difficult to complete that and patients will often drop out because they cannot maintain that. Adam? Speaker 300:57:24Yes, thanks. So obviously, we were thrilled that some payers are starting to look at this category and selecting Cyfobria's preferred choice. So this decision was basically made on its robust efficacy profile and particularly the increasing effects over time. And I think it's really basically simple, right? Fyfro is efficacious with monthly and every other month dosing. Speaker 300:57:49And this is good for patients and is economically supportive for the health plan. And I think that's going to be important for us as this market continues to grow and become bigger and bigger. Speaker 200:58:01And context there is that the flexibility is everything, right? Some patients with aggressive lesions want to be dosed monthly. We have seen very clearly in Gail as well that there are advantages to treating monthly, right. I mean, it is more intense from a dosing perspective, of course, but in terms of reducing the lesion growth, there is an advantage to monthly. So that flexibility, the huge amount of data that we have both in its absolute, but also longitudinally over time, we have 3 years now, we will have more data coming, all of that's incredibly valuable. Speaker 1300:58:37Okay. And just lastly on the Valeant data, just because it's coming up very shortly here. You guys discussed in terms of success and expectation stat sig on the primary. But on the secondary, in terms of is this the positive trend on some secondary endpoints or all and is this what the regulators need to see from conversations? They're just trying to understand more on the secondary endpoints importance here. Speaker 200:59:03Yes, the secondary endpoints need to trend supportive of the primary endpoint. We have seen this with fabalta where none of the secondary endpoints were met. But where we believe there is still a path forward for fabalta. They were specifically asked to submit the data at 1 year, as you may recall, after having the 6 month primary endpoint. Those are all things secondary endpoints are more contextual, but very important to provide support to what we measure with the primary endpoint and the proteinuria reductions. Operator00:59:45Thank you. And one moment as we move on to our next question. Our next question comes from the line of Douglas Tsao with H. C. Wainwright. Operator00:59:55Your line is open. Please go ahead. Speaker 1400:59:58Hi, good morning. Thanks for taking the questions. I'm just curious, Adam, in terms of the patients that are now being treated, I think in the past you indicated that like 90% of them had were already on the books of retina specialists. I'm just curious if that continues to be the case. And then in terms of the DTC work that you have done, for the most part, I think the Henry Winkler campaign has sort of been an unbranded campaign. Speaker 1401:00:24Does there come a point where you might consider now that you're sort of in Phase 2 switch to a branded DTC effort to sort of focus on the competitive dynamics and the attributes of SYPOVI versus ISORVAY? Speaker 301:00:41Yes. Thanks, Doug. So yes, this is obviously a large and growing market with 13% market penetration for the current approved therapies. And most of those patients, in fact, the vast majority of those patients were already on the books of retina specialists. So they're tapping into the patients that have GA that they were perhaps seeing that had other complications, for example. Speaker 301:01:06One thing Phase 2 of our plan is super critical and DTC is also a part of it is that we are going to educate ophthalmologists and optometrists on geographic atrophy of the disease. And once you start to educate those physicians, they will be able to potentially refer viable patients to retina specialist treatment. We see this as a really big market and actually facilitating that education is certainly going to Speaker 201:01:34help us. Speaker 301:01:36So DTC, Doug, yes, Henry Winkler was disease state education. It was incredibly well received by patients, but also by physicians. We did transition as part of Phase 2 to branded DTC. So Henry was educating the world about go and get your eyes checked. And branded DTC is talking about SYFOVRI and the benefits of the efficacy that SYFOVRI can so that patients are educated on the disease and then they can go and ask to have a conversation about Xyphobri. Speaker 301:02:10As we progress moving forward, we're going to push DTC with a real strong approach on actual happening with Henry moving forward. Speaker 1401:02:24Great. Thank you so much. Operator01:02:27Thank you. And one moment as we move on to our next question. Our next question comes from the line of Biren Amin with Piper Sandler. Your line is open. Please go ahead. Speaker 1501:02:39Yes. Hi, guys. Thanks for taking my question. Maybe if I could start with the competitive dynamic. Astellas earlier today on their call, stated that they're seeing Isova capturing majority of new patient starts. Speaker 1501:02:55Are you seeing similar trends from your treatment use market research data? Speaker 301:03:03Yes. So we are seeing through our data set, which is not market research, we use a data set that actually tracks vials into a physician site and then into a patient. So we believe in the robustness of this, but we could do market research and I think you get some bias when you do market research which you can Speaker 501:03:24have to take into account. Speaker 301:03:26And with the headwinds the competitors have, we were still maintaining approximately 50% share of new starts. And I think that's really, really strong considering it was the quarter of their J code. So that's how we look at the data set. We believe 75% market share of total market is a very robust number, and we look to the future of how big this market can be and being the number one GA product Speaker 501:03:50in it. Speaker 1501:03:52Great. That's helpful in terms of data point. And then maybe if I could have a follow-up. So on the quarter, it seems commercial units grew about 10% quarter over quarter if you take out samples, but sales grew about 12% quarter over quarter. So is the remainder from lower gross to net in the quarter? Speaker 1501:04:12And what should we expect for gross to net for the 3rd quarter? Speaker 501:04:17Sure. Thanks, Barry. So gross to net, obviously, we don't say exactly what gross to net is. It did go up slightly this quarter, but was really well within the range of where it was last quarter. And in terms of the files out, those are the accurate numbers and we don't guide on those. Speaker 1501:04:42Great. Thanks for taking my questions. Operator01:04:47Thank you. And one moment. And our last question is going to come from the line of Greg Suvannavejh with Mizuho Securities. Your line is open. Please go ahead. Speaker 1601:05:00Okay, great. Thanks. Thank you for taking my question. I just wanted to follow-up on earlier in the year comments around seasonality and how that impacted the Q1 in particular. I'm just wondering as you've got 2nd quarter now behind you, if you can provide us any commentary on what you're expecting, if anything around seasonality impacts in the 3rd Q4 just as we think about modeling SYFOVI revenue on a go forward basis? Speaker 1601:05:31Thanks. Speaker 301:05:33Yes. Thanks for the question. So obviously seasonality is an important metric to measure here. Every time we go to a big retina conference like ASRS a couple of weeks ago, right, a large proportion of physicians are there. So there are multiple retina meetings moving forward, where physicians will be attending those conferences and learning about our efficacy data. Speaker 301:05:59Caroline, anything you want to add from your retina physician perspective? Speaker 401:06:05That the retina physicians are really looking forward. We have some upcoming exciting presentations and they want to offer patients a product that's going to be effective with increasing effects over time. So they are very motivated and looking forward to working with us on analyzing the data. Speaker 201:06:30And just as a follow-up, Speaker 1601:06:31is there anything on like purchasing patterns, seasonally, 3rd quarter versus 4th quarter, bigger picture? Speaker 501:06:44I don't think we've had enough experience yet to really say that, at least in our in terms of this market, anti digest, there isn't anything that stands out particularly. I mean obviously you have August and that can be a full month just because of education. There's nothing really dramatic. Okay. Speaker 1601:07:01All right. Thanks very much. Operator01:07:06Thank you. And I'm showing as I said, there is no further questions. And I would like to turn the conference back over to Cedric Francois for any further remarks. Speaker 201:07:16Thank you, operator. Thank you everyone for joining us this morning. If you have any follow-up questions, please feel free to reach out to Meredith. We look forward to hearing and speaking with many of you today. Thank you. Operator01:07:27This concludes today's conference call. 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There are 17 speakers on the call. Operator00:00:00Good morning, ladies and gentlemen. Thank you for standing by, and welcome to Apillus Pharmaceuticals Second Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. Operator00:00:30I would now like to hand the conference over to Meredith Kaya, Senior Vice President, Investor Relations and Strategic Finance. Please go ahead. Speaker 100:00:42Good morning, and thank you for joining us to discuss Apellis' Q2 2024 Financial Results. With me on the call are Co Founder and Chief Executive Officer, Doctor. Cedric Francois Chief Operating Officer, Adam Townsend Chief Medical Officer, Doctor. Caroline Baumel and Chief Financial Officer, Tim Sullivan. Before we begin, let me point out that we will be making forward looking statements that are based on our current expectations and beliefs. Speaker 100:01:08These statements are subject to certain risks and uncertainties, and actual results may differ materially. I encourage you to consult the risk factors discussed in our SEC filings for additional detail. Now I'll turn the call over to Cedric. Speaker 200:01:21Thank you, Meredith, and thank you all for joining us this morning. We are in a unique position today with 1 and the potential for 2 blockbuster drugs in the market, Cytovari and Empaveni, both of which are making a meaningful difference for patients. Past 6 months have been a period of continued progress and execution by the Aperis team, but we recognize that there around the competitive landscape for SYFOVRI. Given this, I wanted to share some of my thoughts. SYSOVRI is the market leader in a category with only 2 available drugs, 1,500,000 highly motivated patients and a long runway for continued growth. Speaker 200:02:05That said, there has been a lot of focus on near term dynamics. Our competitor has recently had tailwinds driven by factors such as its new J code. They had every incentive to drive demand in new patient starts as much as possible, and yet we saw approximately half of new patients choose safe ovary. Following last month's successful ASRS meeting, we believe SYFOVRI's clinical profile is being viewed favorably by physicians and will drive more growth in new patient starts over time. The SYFobri launch has been one of the best launches in recent history, generating over $500,000,000 in sales in its 1st 6 quarters and achieving double digit percentage growth every single quarter. Speaker 200:02:52More than 330,000 XIFAVRI injections are estimated to have been administered to patients and this strong growth is continuing into the second half of the year. The GA market is growing significantly and SAIFORRI has only scratched the surface of its long term potential. Importantly, the recent ASRS meeting was a strategic turning point for us, where our focus and our discussions shifted to SYCLOVRI's strong and differentiated efficacy profile. We have multiple analyses supporting the efficacy of SYFOVRI and retina doctors are enthusiastic about the totality of these data. The favorable benefit risk profile of SYFOVRI is becoming clearer to physicians with some key takeaways. Speaker 200:03:431, both monthly and every other month's SYFOL retreatment showed a better efficacy profile than the competitor among patients with non subfovial GA at both 12 24 months as detailed in the matching adjusted indirect comparison post hoc analysis presented. Note that no head to head clinical trials have been performed. 2, SYFOVRI is clinically proven to offer flexible dosing from day 1. Every other month's treatment with SYFOVRI provides an even safer and more cost effective treatment, while maintaining its strong efficacy. And 3, regarding safety, vasculitis is rare and appears to be a first injection phenomenon. Speaker 200:04:31The estimated rate has remained stable at 1 in 4,000 per first injection. During the podium presentation at ASRS, the REST committee confirmed this estimated rate as agreed that it appears to be only on the first injection. After this meeting, we continue to believe that we are well positioned to continue growth and further cement our market leadership in GA for many years to come. Our singular focus is to ensure that every GA patient who needs treatment has access to SYFOVRI. This is how we expect SYFOVRI to continue on its path of becoming a multibillion dollar drug. Speaker 200:05:13As for the European GA opportunity, we are focused on the CHMP reexamination process and are encouraged by the progress we made throughout the initial review. This was not an unexpected outcome given that the process was reset back to day 180 of the initial review and therefore led by the original rapporteur. We were encouraged to learn that in this recent opinion, multiple CHMP members disagreed with the negative opinion. Additionally, the external advisory experts were aligned on microproprietary as the best available functional measure of GA. We are humbled by the broad support shown by the European retina community. Speaker 200:06:01And while we remain conservative in our expectations for the reexamination, we believe we are well positioned heading into the appeal. 2 new rapporteurs were recently designated and we continue to expect the final decision to be issued in the Q4 of 2024. Moving to Empaveri, which continues to elevate the standard of care for patients with PNH. Empaveri generated $24,500,000 in product sales in the Q2. We continue to believe that patients on Empaviti are experiencing substantial benefits as demonstrated by its 97% compliance rate. Speaker 200:06:43Importantly, we are exploring its potential to expand into new indications and become a best in class treatment option for additional high unmet need areas. The upcoming Phase III Valiance top line readout in C3 gs and primary ICMPGN is the next milestone in this process. And we expect to present these data later this month. If the data are positive, we plan to submit a supplemental NDA to the FDA for approval. Regarding the pipeline, we are advancing multiple earlier stage development programs, leveraging our core expertise in complement science to fuel the next phase of value creation for Aperis. Speaker 200:07:28We look forward to sharing our progress at an upcoming Investor Day towards the end of this year. And finally, from a financial perspective, we are benefiting from the growing product revenue generated by SYFOVRI and Empaveri and has actively taken steps to strengthen our balance sheet. We now have a clear line of sight to positive cash flow, allowing us to invest in future growth without having to rely on the capital markets. Before I turn it over to Adam to discuss our commercial activities, I will close by saying thank you to the patients and physicians who motivate us to develop and bring important treatments to market and to the Aperis team who have shown unbelievable commitment and perseverance in getting these important medicines to patients. And to our shareholders, many of whom have stood with us through these dynamic periods and provided unwavering support to us over the years. Speaker 200:08:29With that, I will now turn it over to Anne. Thanks, Cedric, and good morning, everyone. I will begin with Xiphobri. With revenue of about $155,000,000 Speaker 300:08:41sales growth remains strong at more than 12% quarter over quarter. In the 2nd year of our product's launch, quarterly growth rates at these levels are a strong indicator of longer term demand. We delivered over 79,000 commercial doses and approximately 5,000 samples of SYFOVRI in the 2nd quarter. Demand continued to accelerate with June being our highest demand month since launch through the Q2. We are particularly pleased to see the continued progress across the many factors driving growth, including new patient demand and a broadening prescriber base. Speaker 300:09:24Cedric mentioned some of the competitive dynamics, which I know is on everyone's mind. So let's start there. Our competitor had recent tailwinds driven by factors such as obtaining its new J code. And so it is expected that they would see their proportion of new patient share accelerate. We also saw an acceleration when Xiphobri's J code went into effect last October. Speaker 300:09:51However, we do not believe this is indicative of longer term market dynamics. We have taken the long view on contracting as we believe this is a large and growing market and believe that discounting too aggressively now is unsustainable and will lead to price degradation over time. We are also executing our strategic plan in the field to reinforce XIFAVI's benefit risk profile. Xifovri remains the number one chosen treatment for GA with approximately 75% of the treated market as defined by the total number of patients treated. We believe XIFA Re's position as the market leader will continue to be driven by its differentiated efficacy profile and flexible dosing. Speaker 300:10:42Importantly, we are also focused on maintaining market leadership whilst growing the overall GA category. We are still in the beginning stages. Our estimate based on claims data is that about 13% of GA patients who have been diagnosed and are managed by an eye care professional are currently being treated. In addition, only a small portion of newly diagnosed and treated patients are referrals, meaning that most patients currently receiving treatment were already being seen by a retina specialist. This suggests that the majority of GA patients have not yet been diagnosed or referred to retina specialists, reinforcing that we have only scratched the surface of the large opportunity for XIFAVI. Speaker 300:11:33As I mentioned on our last earnings call, we are now executing the next phase of our commercial and medical strategy. After the ASRS meeting in 2023, we developed a 2 phase strategic plan with a 2 year timeline. Phase 1 was focused on being transparent and educating the retina community about everything we were learning at the time around safety. This past quarter, we shifted to Phase 2 of the strategy, which is focused on strengthening our leadership in this growing market. More than 2,100 sites of care have ordered SYFOVRI. Speaker 300:12:11We are now on our front foot, expanding the number of new physicians using SYFOVRI, deepening our relationships with existing SYFOVRI users, establishing strong payer access and reimbursement and increasing awareness and education for patients. With physicians, we are communicating a clean and simple efficacy message, highlighting Xiphobary's increasing effects over time, which is critical given that GA is a chronic disease. We are also sharing the microparametry data from the Gale extension study, the only data for an approved GA treatment that demonstrates a visual function benefit in a pre specified endpoint. This allows for a productive benefit risk discussion with the every other month dosing option having a dramatically positive impact for patients, doctors and payers. We had a successful ASRS meeting a few weeks ago, our first big retina meeting leading with these messages and look forward to the upcoming 4 congresses. Speaker 300:13:20We are also continuing to broaden our reach to more retina specialists as well as other referring eye care providers who see tens of thousands of GA patients. Reaching these physicians and educating them on the referral process are key to developing the GA market. With payers, we have secured unprecedented and broad coverage for patients choosing Xiphobri. We're thrilled to share that 2 large national pharmacy benefit managers have recently made SYFOVRI the only preferred treatment on their commercial formularies. As the preferred product, this means that the new patients with commercial insurance will have full access to XIFAVIRI as the first line treatment and an exception process will have to be undertaken for non preferred or disadvantaged products. Speaker 300:14:16While payers have several considerations in making such decisions, we believe these decisions were driven by XIFABRI's compelling value propositions, highlighting its robust efficacy with increasing effects over time and both monthly and more importantly every other month dosing. These two PBM decisions are important milestones demonstrating payers' strong belief in XIFAVI's clinical and economic value proposition as ensuring broad coverage and seamless reimbursement is critical for retina specialists. And with patients, we've launched the first phase of our branded DTC campaign in the spring, which is focused on encouraging patients to talk to their physicians about GA treatment with XIFAVIRI. This is a very large market and we will be methodical in executing this next phase in order to set ourselves up for the long term. We will continue to execute flawlessly and be focused on getting more doctors, patients and payers to understand the efficacy and the benefits that the leading GA drug can deliver. Speaker 300:15:40Now let me shift to Emperveli. In the Q2, Emperveli generated approximately $24,500,000 in U. S. Net product sales. The positive trends across the key leading indicators for the PNH patient population continue into 2024. Speaker 300:15:59Specifically, compliance rates remain high at 97% and we continue to have a very strong safety profile. As we previously said, with the availability of an oral treatment for PNH, we are facing a more competitive market and expect sales to be flat at least through the next 6 to 12 months. We continue to have new patients starting in PIVELY treatment, but this has been offset by some patients switching to an oral. Finally, I will echo Cedric's enthusiasm regarding the opportunity to potentially expand Empelli into C3g and ICMPGM. This market is approximately 3 times larger than the PNH market and there are no available treatments. Speaker 300:16:46If Empovelly is approved in these indications, we are confident that we can leverage much of our existing infrastructure to rapidly reach nephrologists and deliver empaveli to the thousands of patients suffering from these diseases. With that, I will now turn the call over to Caroline. Caroline? Speaker 400:17:07Thanks, Adam, and good morning, everyone. We are looking forward to sharing the Valyant data later this month. I'll talk more about this opportunity in a minute. I will first talk about SYFOVRI as our team was recently at the ASRS meeting in Stockholm, where we had a significant presence with 5 oral presentations, including a late breaking abstract on visual function from Gale. We are particularly excited by these visual function data as this was the first time a geographic atrophy treatment had demonstrated a visual function benefit on a pre specified analysis. Speaker 400:17:49Results showed that with respect to the microperometry endpoint, patients treated with pegzetacoplin monthly or every other month developed fewer new scotomatous points over 36 months compared to patients from the sham crossover group. Scotomatous points measure the areas of the retina that have lost all light sensitivity and therefore are no longer functioning. These results add to the largest body of evidence for our geographic atrophy treatment and reinforce the unprecedented effects shown by SYFOVRI to both meaningfully slow geographic atrophy lesion growth and by doing so preserve visual function. ASRS is one of the most important retina meetings of the year. And we had the opportunity to engage with many members of the retina community. Speaker 400:18:46This was a highly successful meeting for XIFAVRI and we heard repeatedly from doctors about its differentiated benefits. We look forward to continuing to engage with this community at upcoming meetings and to share the ongoing progress of SYFOVRI in patients with geographic atrophy. Moving to Empivelli. Later this month, we expect to share top line results from our Phase 3 VALION study of pegzidacoplin in people living with C3g and ICMPGN, 2 rare and debilitating kidney diseases caused by uncontrolled complement activation and breakdown of C3. Patients are usually diagnosed in adolescence and about 50% advanced to end stage kidney failure in 5 to 10 years. Speaker 400:19:38Treatment options are generally a kidney transplant or lifelong dialysis, neither of which are curative. In fact, nearly 90% of transplant patients experience disease recurrence and about half of them end up losing their transplanted organ. The Phase 3 VALION study enrolled 124 patients with either C3G or primary ICMPGN. This is the largest single trial conducted in these populations and the only Phase III study to enroll a broad population inclusive of adolescent and adult patients with native and post transplant forms of disease. The primary endpoint of the VALION trial is a log transformed ratio of urine protein to creatinine ratio or uPCR, a key marker of disease progression in all patients at week 26 compared to baseline. Speaker 400:20:39We view success in this trial as the achievement of a statistically significant response to the primary endpoint as well as positive effects in some of the additional secondary endpoints. Physicians have shared that this would be clinically meaningful for these patients. If Valyant is positive, we plan to submit the supplemental NDA to the FDA for approval. Following the completion of the VALION study, patients were given the option to enroll into the VAIL long term extension study. We were highly encouraged to see that 100% of the patients who have already completed Varian have now enrolled into VAIL. Speaker 400:21:25Beyond the Valyens study, we are continuing to advance our earlier stage pipeline, such as our C3 siRNA that is currently in Phase 1 development and our Beam collaboration. Like Cedric said, we are excited to share more details about our pipeline programs with you at an Investor Day later this year. I will now turn the call over to Tim for a review of the financials. Speaker 500:21:53Tim? Thank you, Caroline. I will now provide an overview of our financials and some comments on our debt refinancing with Sixth Street. Additional details are available in the press release that we issued earlier this morning. Total revenue for the Q2 of 2024 was approximately $200,000,000 including $155,000,000 in CYPOVRI and $24,500,000 in Empovella U. Speaker 500:22:15S. Net product revenue. This compares with $95,000,000 in total revenue in the Q2 of 2023. Turning to the rest of the P and L. For the Q2, cost of sales was $23,000,000 R and D expenses were $78,000,000 SG and A expenses were $128,000,000 and we reported a net loss of $38,000,000 As I previously stated, we are realizing efficiencies this year related to our restructuring in 2023 and continue to expect our total operating expenses in 2024, inclusive of R and D and SG and A expenses, to be less than our total expenses in 2023. Speaker 500:22:55This year, we've been focused on strengthening our balance sheet. These efforts ultimately resulted in a strategic non dilutive refinancing collaboration with Sixth Street that we announced in May. The deal allowed us to prepay our FFJ debt at a significant discount and to free up substantial cash flow. A quick look at the terms reveals how favorable this deal was. 1st, this debt facility provides us with up to $475,000,000 of which $375,000,000 became available immediately upon closing. Speaker 500:23:26We can access the remaining $100,000,000 at our option over time. Importantly, this deal was debt neutral to Apellis. We replaced $366,000,000 in payments due to SFJ over the next few years with $375,000,000 from Sixth Street. The principal repayment is pushed out to May 2030 and Syphobia revenues are expected to be closer to peak. Our payments are interest only until then. Speaker 500:23:53This deal also substantially improves our liquidity and provides flexibility to access at least $200,000,000 in incremental non dilutive capital as we continue to invest in profitable growth. And it includes a record low credit spread. The overall terms were some of the best in biotech seen in recent history. In aggregate, since the beginning of the year, we have unlocked over $475,000,000 in non dilutive capital, including $100,000,000 from the Cap Call unwind announced in the Q1. Plus, we have the flexibility to bring in $100,000,000 to an accounts receivable line, which can be increased to $200,000,000 upon the achievement of certain milestones and $100,000,000 more from Sixth Street, so a total of $775,000,000 in non dilutive financial flexibility. Speaker 500:24:42This combined with the $360,000,000 in cash and cash equivalents that we had at the end of June 30, 2024 puts us in a strong financial position where we are on a path to becoming cash flow positive and no longer having to rely on the capital markets to fund the business. Importantly, our ability to begin generating cash is possible in both the EU and non EU scenarios. While we believe the opportunity in Europe is significant, the ramp to peak sales is much longer and so the main source of profitability in the near term remains growth in the U. S. I will now hand the call back over to Cedric for closing remarks. Speaker 500:25:18Cedric? Speaker 200:25:19Thanks, Tim. We've had a very strong first half of the year. With 2 successful commercial products, a pipeline of innovative programs in development and a strong financial position to support the business, I am more confident than ever in our ability to continue creating significant value for our patients and our shareholders. And we will now open the call for questions. Operator00:25:44Thank Our first question is going to come from the line of John Miller with Evercore. Your line is open. Please go ahead. Speaker 600:26:11Hi, guys. Thanks so much for taking the questions. I would love to start with I'll start with this. Do you expect the share of new starts currently around that 50% mark to grow again post a successful ASRS? And then I guess the corollary to that is your guidance to cash flow positivity, you just mentioned doesn't assume anything more than U. Speaker 600:26:35S. GA launches, but does it assume more than the existing share of new starts in the U. S? Speaker 200:26:47Thank you so much, John. Great to hear you. So that is, of course, the most important question, right? I mean, is the new starts. In the Q2, as we have discussed, there were tailwinds for IZURVE. Speaker 200:27:03But as we now move forward, what really stands out and what is very encouraging to see is the very large market and the fact that Xyphovir is leading on efficacy, flexible dosing and economic value. So as we move forward now, we plan to recapture the lead on those first injections and take advantage of this very large market with an important unmet need. Adam, do you want to add? Speaker 300:27:29Yes. Thanks, Patrick. Hey, John. So yes, we're in Phase 2 and we're already encouraged by the growth and the demand we're seeing into July. We're on the front foot. Speaker 300:27:40We're talking about efficacy. We're talking about every other month dosing. These are huge differentiating factors for this great drug. We can see the future and we can see that we will continue to be the number one GA drug in this market. Speaker 200:27:55Tim, do you have any questions? Yes. Speaker 500:27:57So in terms of cash flow, our revenue was $199,700,000 and our cash OpEx, if you take out stock based comp and depreciation, it's just under that. So that was 199 $199,000,000 a little bit less than that. So really on a total OpEx basis, on a cash basis, we are net neutral. So the differences right now are working capital and of course interest expense. So it really doesn't take much in terms of growth for us to become cash flow positive. Speaker 500:28:26We're not guiding to when that will happen. But given the size of the market and the growth in this market, I don't think that's something we worry about. Speaker 600:28:39Great. Makes sense. And I guess my follow-up would be your language on EU approval seems more positive now than it has in the past. You mentioned that you're well positioned heading into this appeal and I think that's a little bit more positive than the previous messaging we've heard where we're all assumption all of our assumption was that this was not Speaker 200:29:04the base case. But how do Speaker 600:29:05you feel now versus how you felt the last time you had into an appeal? Do you really feel like the likelihood of an approval without further trials or without further resubmission is much higher now? Speaker 200:29:19Thank you, John. So the expectation should remain the same. What is of course, the one nice takeaway from the fact that this procedure was reset was the ability for us to introduce new data and that includes the pre specified endpoints assumption, which is of course something really important and encouraging and really speaks to the appeal of this drug to patients. So again, in terms of expectations, that has not changed. The process has gone according to plan. Speaker 200:29:49We've been disciplined and we look forward to the 4th quarters to share what the results are. Speaker 500:29:57Thanks so much. Operator00:29:59Thank you. And one moment as we move on to our next question. And our next And our next question is going to come from the line of Anupam Rama with J. P. M. Operator00:30:10Your line is open. Please go ahead. Speaker 500:30:13Hey, guys. Thanks so much for taking the question. You guys noted that for SYFOVRI, June was your best Speaker 200:30:19month since launch. Maybe you could give us Speaker 500:30:21a little more color on what you were seeing on a month by month basis in the quarter. Was the IZARRAY sort of J code impact more like first half of the quarter dynamic and then you saw reacceleration of CIFO regrowth or how do we think about like what the dynamics were within the quarter? Thanks so much. Speaker 200:30:42Thank you so much, Anupam. I will hand it over to Adam, but I think again what stands out here and what we're super excited about is how large this market is, the fact that it's growing, the fact that AZERVATE does well in a duopoly that will be here for a long time and us having a drug that is meaningfully differentiated on efficacy and dosing flexibility, that is really what we are focused on. But Adam, you may want to add something. Speaker 300:31:08Yes. Hey, Adam. So yes, June was the highest month of the quarter and also the highest month launch today. Across multiple metrics, we saw that Q2 was a very successful quarter for us across multiple months, right? We continue to grow accounts, now getting to 2,100 sites of care. Speaker 300:31:29We saw double digit growth for the quarter. We're fully into Phase 2 of our plan. And I think some of the initial steps of that happening in June is what we can witness there, right? Talking about efficacy, talking about flexible dose, and I think that's what we're really pushing hard as we now move to the next quarter. Speaker 500:31:51Thanks so much for taking the question. Thank you. Operator00:31:56And one moment as we move on to our next question. And our next question comes from the line of Salveen Richter with Goldman Sachs. Your line is open. Please go ahead. Speaker 700:32:08Hi. This is Srinathra on for Salveen. Thank you so much for taking our question. So on the competitive dynamics, what are the factors which are driving the competitive and physician dynamics in the GA market following the permanent J code for IsoVE? And could you speak to the market share that you're seeing at this point and how you expect that to evolve over the near term? Speaker 200:32:35Thank you so much for that question. So we are the market leader. We plan on continuing to be the market leader and that confidence is based on stability around the safety, which was really important and where ASRS was a real turning point for us, right. For those of those that were there, it was a quiet meeting on that front and the discussion is very much shifted towards the efficacy profile. There the majority of doctors clearly see the differentiation of safe ovary versus the competition. Speaker 200:33:04So as we now move forward, the focal point will more and more become efficacy, the differentiation, the long term data, the mass amount of data that we have with CICEFOVRI and then the real and important benefit of every other month dose 6. So the convenience that that offers to patients, also the fact that helps the number of intravidional injections is twice as safe as monthly injections. All of these things are going to come more into And Adam, if you want Speaker 500:33:34to add something. Speaker 300:33:35Sure. Yes. So obviously, if you go back to our J code, we also notice tailwinds when we had our J code unlocked certain new accounts. So the competitor had some tailwinds. And even with those tailwinds, we maintained approximately 50% of new starts and market leadership at 75% of the total market. Speaker 300:33:58That is down, as Cedric said, to a real successful execution of Phase 2 of our strategic plan plus some positive comments moving forward from ASRS. Now you also asked about market share. So we track market share based on vials going into physicians and then being injected into patients. And so we think that's the most robust way of measuring market share, and we had a 75% market share. Now, as this market grows, we will continue to push incredibly hard on our efficacy message, our dosing convenience and the economic value. Speaker 300:34:36And we think that, that will maintain our leadership moving forward. Speaker 700:34:43Really helpful. Thank you. Operator00:34:46Thank you. And one moment as we move on to our next question. And our next question comes from the line of Yigal Nochomovitz with Citigroup. Your line is open. Please go ahead. Speaker 800:35:00Hi, great. Thank you very much for taking the questions. Shifting over to CTG and ICMPT N, I just wanted to get your thoughts on how you expect the position type for the coplan in this market, assuming valine is positive? And what do you think you need to show on proteinuria as well as some of the other secondary endpoints that Caroline mentioned to be competitive with the emerging oral option. Speaker 200:35:31Okay. Yes. Sorry, Yigal. We had a hard time hearing you here. Tim, who has explained hearing for me. Speaker 200:35:39So, look, we are very excited about the opportunity in C3GNIC MP Gen as you know. This is something that has been a little bit below the radar screen of most, but a really large and important opportunity for us. We have seen the results from the NOBLE study where we have the histopath data, which is really best in class ever seen within this disease. We also have already while this drug is not on the market yet seen the excitement around science for this drug. And we have seen in the NOBLE study approximately 50% reductions in proteinuria. Speaker 200:36:19So that is of course the goal for us is to meet statistical significance on the primary endpoint and then to really pay attention to the transplanted population. So, yes, I hope that answers your question. Speaker 800:36:35No, that's helpful. And then I guess another question in terms of the design of Valyant. We are combining C3G and ICMPGN into one study. Obviously, the competitor is doing separate studies for both indications. Do you see that as being a significant difference in terms of how physicians will interpret and implement the data when both of those are approved? Speaker 200:36:59Yes. That will depend on the data, right. So I think you bring up a very important point, which is that the way in which the study reads out should be viewed in the context of, of course, what we have seen with XAVELTA. We decided to include in one study both C3G and ICMPGN with the hope that the data would be good enough for both to find their way into our label. So we're going to see if that's the case or not. Speaker 200:37:24And we're going to see how the data stacks up against what has already been disclosed by Novartis in the past Speaker 800:37:32months. Great. Thank Speaker 900:37:34you. Thank you. Operator00:37:36Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Steve Seedhouse with Raymond James. Your line is open. Please go ahead. Speaker 1000:37:50Thank you. Good morning. Thanks for the update. First question, I just regarding new line item on the balance sheet for long term inventory at $23,000,000 entry. Has there been any change to the expected sales trajectory in the next 12 months versus prior? Speaker 1000:38:06Are you anticipating that entry will be gone in subsequent quarters or is it going to grow? And then also what is the shelf life of the raw materials, I guess that comprise that entry? Speaker 500:38:18Yes. Thanks, Steve. So that entry was put in place because we have to do our ordering for our inventory long in advance and we had planned for the potential success of ALS. There's also a couple of other factors, which include the delay in the EU for Cypropri and also our expected ordering from Sobeys. So we have the plan for all that well in advance. Speaker 500:38:43And so much of that, in fact, most of it has to do with Infiniti. So we don't know exactly how long that line item will last there, but most of that inventory has a shelf life of 3 years or more. So we just put that in place because of the dynamics we talked about, but it's primarily in the value. Speaker 1000:39:06Okay. Good to know. And then just on the dynamic of patients maybe switching between Eiservate and Cyfovirate, has that do you have good visibility into both directions of switching there? And has it been if so, has it been sort of a net positive, net negative or net neutral in terms of unique patients on either drug? Thanks. Speaker 300:39:31Hey, Steve, it's Alan. So yes, we have some visibility to that now, obviously, with all analysis that we can do, it's only a subset of the total market. So obviously, last year, we did see some switching from cyfobri to ISOVATE. We saw 1 or 2 accounts switch the majority of that patients. And what we have seen moving forward is we've actually seen some switching from iZovate come back to Cyfovary. Speaker 300:39:59And our assumption there is that's based on the efficacy and the flexible dosing of this drug. Switching tends to be a very small piece of the market, and it goes both ways based on our data set. As we look forward into Q3 and beyond, right, we're really, really encouraged by all of the metrics we're seeing about strong demand across multiple metrics. That includes switching as a piece of it, a small piece of it. That includes new starts and our plan to execute everything to push new starts. Speaker 300:40:33It includes more physicians writing cyfobri for the first time and increasing the number of accounts Speaker 200:40:40that are using cytovery. Speaker 300:40:41We're really, really positive on what we're seeing so far. And we think a lot of that's down to this strong efficacy, the leading efficacy, flexible dose and economic valve. Hopefully, Steve, that answers your question. Yes. Speaker 1000:40:56Thanks so much, Adam. Thank you very much. Operator00:41:00Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Colleen Koozie with Baird. Your line is open. Please go ahead. Speaker 100:41:12Great. Thanks. Good morning and thanks for taking our questions. Can Speaker 400:41:16you provide any thoughts on when you might provide revenue guidance for Cypropri? Speaker 500:41:23Sure. Thank you. So obviously, we're not providing it for the remainder of this year and it's something we'll reconsider for next year, but we're not guiding on the guide yet. Speaker 100:41:33Thank you. And then for the EU review, I think Speaker 400:41:36you said the repertoires have been selected. Can you provide any commentary on the background of the new repertoires and if either of them were a dissenting voter from the Speaker 100:41:45most recent review? Speaker 200:41:48Thank you so much, Colleen. So we don't provide details on that. As mentioned, we consider the odds of success to have remained stable, the process to have gone very much in line with what we had expected. And hopefully, in the Q4, we'll be able to come back with positive news. Speaker 100:42:07Understood. Thanks for taking our questions. Speaker 200:42:10Thank you, Pauline. Operator00:42:11Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Phil Nadeau with TD Cowen. Your line is open. Please go ahead. Speaker 900:42:22Good morning. Thanks for taking our questions On the competitive environment, first, I had prepared remarks and then I mean, maybe a couple of more about what you're seeing from your competitors in terms of cash and a little bit more about pelletives on strategy and accounting. And second, the dynamics of the competition, what are you seeing the position in center level overall? Are students becoming iSurvey versus iSurvey position using both and centers that are 1 versus the other or are they using both? If they're using both, how are they using patients? Speaker 900:43:02Thanks. Speaker 200:43:03Hey, Phil. I don't know if it's Arlen or yours, but we have a very hard time hearing your question. Speaker 900:43:10Sorry, let me try again. Yes. So first on discounting, what are you seeing in the marketplace on discounting and what is a pellet's own strategy on discounting? And then second, on competition, can you talk about on the patient sorry, on the physician center level, are centers choosing 1 or the other or are they going patient by patient using either way versus seboprene? Thanks. Speaker 200:43:33Thank you so much. Adam, do you want to take that? Speaker 300:43:35Yes. Hey, Bill. Thanks for repeating the question. So contracting is obviously a standard process in this market, and we're taking a really strategic and thoughtful view on how we contract in this market. This is a large and growing market, and we've only just scratched the surface of moving patients into the market. Speaker 300:43:58So if you look forward to how big this market could possibly be, we want to maintain as much value as is possible. So we've been incredibly thoughtful on contracting. Then to your second part of your question. So at an account level, right, we have seen that there are many SIFO re advocates and fans. And these physicians are choosing SYFOVRI for its leading efficacy, flexible dosing, its now well documented safety profile and the robust real world evidence. Speaker 300:44:34And that comes consistently when we interact to its physicians various other interactions too. Now no surprise, there are always some competitor physicians also who tend to be choosing the competitor for its safety profile. One thing we have noticed, and I don't know if Caroline wants to comment afterwards is, a lot of physicians will have a discussion about, cyfobry, for example, with their patient and explain the efficacy profile and the flexible medicine. And some physicians will have the same conversation on either. So the patient voice is also important in this discussion and we truly believe that efficacy will drive patients to want to choose software. Speaker 300:45:19Caroline, anything you want to add? Speaker 400:45:22Thank you. Hi, Phil. I think when it comes to physician use, we just had an ad work yesterday and speaking with my colleagues at ASRS, they're very driven to have less than monthly dosing, which is consistent with the high efficacy. And they're really also driven by our data that goes into 3rd year of use that patients have completed the Gail study, some patients with over 5 years of continuous use of Cyprobary. So to them, the most important thing is to give the maximum efficacy with the least burden for patients. Speaker 500:46:03That's helpful. Thank you. Operator00:46:06Thank you. And one moment as we move on to our next question. Our next question comes from the line of Akesh Tewari with Jefferies. Your line is open. Please go ahead. Speaker 400:46:18Hey, this is Amy on 3rd cost. Thanks so much for taking cost. So you've alluded to a safety update second half of this year. Just wanted to get a sense of what that could entail. Also given Eiservate has half the amount of PEG and a shorter half life compared to Cybovir, are you working with ASRS and other doctors to run studies looking at dose titration or spaced out dosing regimens for cyfovirate? Speaker 400:46:43And when can we get an update on that? Speaker 200:46:47Thank you so much for that question. So first of all, the safety is now very clear and well established. So the what was really important for us was at ASRS that the ASRS REST Committee agreed with Aperis on the rarity of these events, 1 in 4000 on the first injection and the fact that this is primarily a first injection phenomenon, right. So those are important facts. And of course, then you place it in the broader context of the safety where CyFovir stacks up very well against IZURVE specifically also because of that every other month dosing that is available. Speaker 200:47:23So based on an enormous denominator of 330,000 injections, we know very well what the safety profile is. I don't think there's going to be much more discussion around that. What we will talk a lot about now is what the efficacy really looks like. And I think that is where the discussion is going to go. What was really gratifying to see coming out of ASRS is that everything is becoming more quiet and more recent within this field. Speaker 200:47:52So only 13% of patients with GA right now have been treated. These patients are desperate for treatment. They are going blind, understanding the safety profile and the efficacy that they get in return is really important and is going to drive the growth of this market for many years to come. So that is something that really stood out. In terms of mitigations for something as rare as this event, it is a question what can you do, what should you do. Speaker 200:48:19It's of course, when it happened, it's not good. But intravitreal injections carry a risk. Every time you do an intravitreal injection, there's a chance of 1 in 3 to 5,000 of getting infected in ophthalmosis as well. That is normal with any type of drug. So this is really something that we're looking forward to. Speaker 200:48:37I don't know if Caroline wants to add something. Speaker 400:48:40I think the retina community has really appreciated our transparency with this and our partnership. I mean, we are driven by science and we're driven by what's going to be best for patient care. And that is the continual feedback. And I will tell you that the community would have no problem giving different sort of feedback if that was indicated. So they're really pleased with this. Speaker 400:49:04And they're really excited to continue to work with us and develop more data for our patients to give them the best care. Speaker 200:49:11Yes. And we're really feeling that momentum this quarter, right. I mean, it's really I think SRS was a real turning point for Speaker 400:49:20us. Great. Thank you so much. Operator00:49:23Thank you. And one moment as we move on to our next question. And our next question is going to come from the line of Ellie Marie with UBS. Your line is open. Please go ahead. Speaker 1100:49:34Hey guys, thanks for taking the question. Just a quick one on cyphobray and then a question on Valeant. Sorry if I missed this before, but can you confirm if volumes were up in July versus June for SYFOBRII? And then, for VALYANT, just how are you thinking about what's clinically meaningful in the pre versus post transplant setting? And then any difference in efficacy expected between these two settings? Speaker 1100:50:01And just commercially, how you're thinking about the relative size of the population opportunity for pexadacopalan in the pre versus post transplant patients? Thanks. Speaker 200:50:13Thank you so much. Adam, Adam, do you want to take the first question? Speaker 300:50:15Yes. So we're really thrilled with the strong growth because it's continuing into July and we expect it to continue for the rest of the quarter and onwards. We're seeing it across multiple metrics and I think it's down a lot to flawless execution of Phase 2 of our plan. We are now on the front foot and we're pushing hard. So we're thrilled with what we're seeing into July. Speaker 300:50:39We expect that to continue. We're going to work hard to make sure. Speaker 200:50:44And then as it relates to Valyant, so pre versus post transplant. So as you may recall, Elide, for us, the post transplant segment is a very intriguing one because it's easy to take biopsies and to track on histopathology what your drug does in that population. It is also a population that was kind of deprioritized by our competitors and it's one that we happily embrace because what is best for a transplanted kidney is best for kidneys with this disease period. So this is really something that has many advantages for us to focus on. But on the other hand, should our data be really good in Valient, there is a real opportunity to differentiate from fabalta and in a disease as serious as C3G or ICMP efficacy is what will really, really matter more than convenience, right? Speaker 200:51:36Whether you take a pill or subcutaneous, if you have a real differentiation on efficacy, that is what will stand out. I also want to point out, of course, we've always talked about the remarkable safety profile that we've seen in PNH and the other indications where Empevy has been used and is on the market, combined with this extraordinary compliance rate of 97%. Empaveri just the same active ingredient that Ciforvary is an amazing drug and hopefully in Valient we will see a new indication emerge for that drug. Speaker 1100:52:09Okay, great. Thanks. Operator00:52:12Thank you. And one moment as we move on to our next question. And our next question comes from the line of Annabel Samimy with Stifel. Your line is open. Please go ahead. Speaker 1200:52:25Hi, all. Thanks for taking my call. So I guess in our channel checks, we're happy to find that consensus among these physicians we spoke to is generally in line with your comments that physicians give SYFOVRI that edge on efficacy. I guess my question is, how are they responding to the microprimatory data? Because it's not something that they typically do in their offices. Speaker 1200:52:44So how can they use that with their patients practically so they can show patients benefit over time and keep them motivated? And I ask that, I guess, for retention beyond that, say, 18 months to 2 year timeframe where patients may start dropping off. Do they have the tools right now? And are they starting to adopt some of these tools so they can demonstrate to their patients that this is working? Thanks. Speaker 200:53:13Thank you, Annabel. Adam is going to first answer the first question. Yes. Speaker 300:53:16Thanks Annabel. So I appreciate your comments on efficacy. We also did a recent piece of market research and we noticed in our sentiment to our market research that our efficacy perception is increasing and there's a gap between us and the competitor in our market research. So it seems to confirm what you said. I'll hand over to Caroline on micro Speaker 400:53:39Thank you, Adam. Physicians are really excited about the microproprietary data. And in showing them, they see the trend in the microprimatory data that's followed over time and that it reaches this pre specified endpoint. I think that most physicians realize that microproprietary in many ways is analogous to a visual field testing. And they appreciate that it shows benefit in a clinical trial. Speaker 400:54:09But in the real world, they like to use OCT, which also has shown benefits using our AI algorithms combined with the University of Vienna. So I think the fact that we have this pre specified endpoint though is very highly meaningful and it will mostly be used to date in clinical studies, although some people are using micropermatria in the real world. In the real world, we can use imaging to show this to patients and we have cases that we've shown to physicians. In fact, we showed one at ASRS where a patient in the observed fellow eye, the geographic atrophy grew 3x as much compared to the treated eye. So cases like this are highly meaningful and that was in Matt McCumber's video talk at ASMS. Speaker 1200:55:04Great. Thank you. Operator00:55:06Thank you. And one moment as we move on to our next question. Our next question is going to come from the line of Francois Brisebois with Oppenheimer. Your line is open. Please go ahead. Speaker 1300:55:19Hi. Thanks for the question here. So I was just wondering, so in terms of function we've discussed, but on convenience and the importance of that and the economic value, can you help us understand a little bit from the convenience, is that as advantages to the physician as it is to the patient? I'm just trying to understand if convenience and economic value here have a correlation or not. Speaker 200:55:44Thank you, Francois. Well, there's 3 pieces to that question, right? There's the convenience to the patient, convenience to the physician and then the convenience quite frankly to the payer. So when we start with the convenience to the patient having every other month dosing available is really, really good. Our competitor, sure there is some off label use with every other month, but our competitor has only monthly. Speaker 200:56:09We're going to find out at the end of this year if they actually ever get every other month in their label. This is a huge point of differentiation that we will benefit meaningfully from should it end up the way we think. The advantage to physicians of every other month is again the flexibility. And I'm going to let Caroline answer like her view on that and then have Adam dive into the payer aspect of the value? Speaker 400:56:39Well, certainly to realize the anatomic benefits of Cyprovary, we've seen that every other month dosing is meaningful. And I think that with our flexible every 25 to 60 days in our label, patients can come every 6 to 8 weeks and still realize these meaningful effects. And certainly in the U. S, physicians love to have that plusminus 1 to 2 weeks with their dosing. And it's more likely for patients to come in and complete this. Speaker 400:57:11We know that with monthly dosing from our anti VEGF experience, it's really very, very difficult to complete that and patients will often drop out because they cannot maintain that. Adam? Speaker 300:57:24Yes, thanks. So obviously, we were thrilled that some payers are starting to look at this category and selecting Cyfobria's preferred choice. So this decision was basically made on its robust efficacy profile and particularly the increasing effects over time. And I think it's really basically simple, right? Fyfro is efficacious with monthly and every other month dosing. Speaker 300:57:49And this is good for patients and is economically supportive for the health plan. And I think that's going to be important for us as this market continues to grow and become bigger and bigger. Speaker 200:58:01And context there is that the flexibility is everything, right? Some patients with aggressive lesions want to be dosed monthly. We have seen very clearly in Gail as well that there are advantages to treating monthly, right. I mean, it is more intense from a dosing perspective, of course, but in terms of reducing the lesion growth, there is an advantage to monthly. So that flexibility, the huge amount of data that we have both in its absolute, but also longitudinally over time, we have 3 years now, we will have more data coming, all of that's incredibly valuable. Speaker 1300:58:37Okay. And just lastly on the Valeant data, just because it's coming up very shortly here. You guys discussed in terms of success and expectation stat sig on the primary. But on the secondary, in terms of is this the positive trend on some secondary endpoints or all and is this what the regulators need to see from conversations? They're just trying to understand more on the secondary endpoints importance here. Speaker 200:59:03Yes, the secondary endpoints need to trend supportive of the primary endpoint. We have seen this with fabalta where none of the secondary endpoints were met. But where we believe there is still a path forward for fabalta. They were specifically asked to submit the data at 1 year, as you may recall, after having the 6 month primary endpoint. Those are all things secondary endpoints are more contextual, but very important to provide support to what we measure with the primary endpoint and the proteinuria reductions. Operator00:59:45Thank you. And one moment as we move on to our next question. Our next question comes from the line of Douglas Tsao with H. C. Wainwright. Operator00:59:55Your line is open. Please go ahead. Speaker 1400:59:58Hi, good morning. Thanks for taking the questions. I'm just curious, Adam, in terms of the patients that are now being treated, I think in the past you indicated that like 90% of them had were already on the books of retina specialists. I'm just curious if that continues to be the case. And then in terms of the DTC work that you have done, for the most part, I think the Henry Winkler campaign has sort of been an unbranded campaign. Speaker 1401:00:24Does there come a point where you might consider now that you're sort of in Phase 2 switch to a branded DTC effort to sort of focus on the competitive dynamics and the attributes of SYPOVI versus ISORVAY? Speaker 301:00:41Yes. Thanks, Doug. So yes, this is obviously a large and growing market with 13% market penetration for the current approved therapies. And most of those patients, in fact, the vast majority of those patients were already on the books of retina specialists. So they're tapping into the patients that have GA that they were perhaps seeing that had other complications, for example. Speaker 301:01:06One thing Phase 2 of our plan is super critical and DTC is also a part of it is that we are going to educate ophthalmologists and optometrists on geographic atrophy of the disease. And once you start to educate those physicians, they will be able to potentially refer viable patients to retina specialist treatment. We see this as a really big market and actually facilitating that education is certainly going to Speaker 201:01:34help us. Speaker 301:01:36So DTC, Doug, yes, Henry Winkler was disease state education. It was incredibly well received by patients, but also by physicians. We did transition as part of Phase 2 to branded DTC. So Henry was educating the world about go and get your eyes checked. And branded DTC is talking about SYFOVRI and the benefits of the efficacy that SYFOVRI can so that patients are educated on the disease and then they can go and ask to have a conversation about Xyphobri. Speaker 301:02:10As we progress moving forward, we're going to push DTC with a real strong approach on actual happening with Henry moving forward. Speaker 1401:02:24Great. Thank you so much. Operator01:02:27Thank you. And one moment as we move on to our next question. Our next question comes from the line of Biren Amin with Piper Sandler. Your line is open. Please go ahead. Speaker 1501:02:39Yes. Hi, guys. Thanks for taking my question. Maybe if I could start with the competitive dynamic. Astellas earlier today on their call, stated that they're seeing Isova capturing majority of new patient starts. Speaker 1501:02:55Are you seeing similar trends from your treatment use market research data? Speaker 301:03:03Yes. So we are seeing through our data set, which is not market research, we use a data set that actually tracks vials into a physician site and then into a patient. So we believe in the robustness of this, but we could do market research and I think you get some bias when you do market research which you can Speaker 501:03:24have to take into account. Speaker 301:03:26And with the headwinds the competitors have, we were still maintaining approximately 50% share of new starts. And I think that's really, really strong considering it was the quarter of their J code. So that's how we look at the data set. We believe 75% market share of total market is a very robust number, and we look to the future of how big this market can be and being the number one GA product Speaker 501:03:50in it. Speaker 1501:03:52Great. That's helpful in terms of data point. And then maybe if I could have a follow-up. So on the quarter, it seems commercial units grew about 10% quarter over quarter if you take out samples, but sales grew about 12% quarter over quarter. So is the remainder from lower gross to net in the quarter? Speaker 1501:04:12And what should we expect for gross to net for the 3rd quarter? Speaker 501:04:17Sure. Thanks, Barry. So gross to net, obviously, we don't say exactly what gross to net is. It did go up slightly this quarter, but was really well within the range of where it was last quarter. And in terms of the files out, those are the accurate numbers and we don't guide on those. Speaker 1501:04:42Great. Thanks for taking my questions. Operator01:04:47Thank you. And one moment. And our last question is going to come from the line of Greg Suvannavejh with Mizuho Securities. Your line is open. Please go ahead. Speaker 1601:05:00Okay, great. Thanks. Thank you for taking my question. I just wanted to follow-up on earlier in the year comments around seasonality and how that impacted the Q1 in particular. I'm just wondering as you've got 2nd quarter now behind you, if you can provide us any commentary on what you're expecting, if anything around seasonality impacts in the 3rd Q4 just as we think about modeling SYFOVI revenue on a go forward basis? Speaker 1601:05:31Thanks. Speaker 301:05:33Yes. Thanks for the question. So obviously seasonality is an important metric to measure here. Every time we go to a big retina conference like ASRS a couple of weeks ago, right, a large proportion of physicians are there. So there are multiple retina meetings moving forward, where physicians will be attending those conferences and learning about our efficacy data. Speaker 301:05:59Caroline, anything you want to add from your retina physician perspective? Speaker 401:06:05That the retina physicians are really looking forward. We have some upcoming exciting presentations and they want to offer patients a product that's going to be effective with increasing effects over time. So they are very motivated and looking forward to working with us on analyzing the data. Speaker 201:06:30And just as a follow-up, Speaker 1601:06:31is there anything on like purchasing patterns, seasonally, 3rd quarter versus 4th quarter, bigger picture? Speaker 501:06:44I don't think we've had enough experience yet to really say that, at least in our in terms of this market, anti digest, there isn't anything that stands out particularly. I mean obviously you have August and that can be a full month just because of education. There's nothing really dramatic. Okay. Speaker 1601:07:01All right. Thanks very much. Operator01:07:06Thank you. And I'm showing as I said, there is no further questions. And I would like to turn the conference back over to Cedric Francois for any further remarks. Speaker 201:07:16Thank you, operator. Thank you everyone for joining us this morning. If you have any follow-up questions, please feel free to reach out to Meredith. We look forward to hearing and speaking with many of you today. Thank you. Operator01:07:27This concludes today's conference call. Thank you for participating and you may now disconnect.Read morePowered by