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spk05: Hello, and welcome to the Insight First Quarter 2024 Earnings Call. If anyone should require operator assistance, please press star zero on your telephone keypad. Our question and answer session will follow the formal presentation. You may be placed into question queue at any time by pressing star one on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Ben Strain, Associate Vice President, Investor Relations. Please go ahead, Ben.
spk03: Thank you, Kevin. Good morning and welcome to Insight's first quarter 2024 earnings conference call. Before I begin, I encourage everyone to go to the investors section of our website to find the press release, related financial tables, and slides that follow today's call. On today's call, I'm joined by Irve, Pablo, Christiana, who will deliver our prepared remarks. Barry, Stephen, and Mateo will also be available for Q&A. I would like to point out that we'll be making forward-looking statements which are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. I encourage you to consult the risk factors discussed in our SEC filings for additional detail. I will now hand the call over to Hervé.
spk00: Thank you, Ben, and good morning, everyone. Before I get into the quarterly results, I'm pleased to share that Matteo Trotta has recently joined Insight as general manager of our U.S. dermatology business unit, reporting to me. Matteo comes to us from Novartis, where he was responsible for the immunology business in the U.S., and he will be leading the U.S. dermatology team at Insight to continue to grow Opselora, prepare for the launches of Povercitinib and other promising IAI pipeline products in the coming years. Now turning to our Q1 result. Total revenue grew 9% in Q1 versus last year, and I will discuss in the next slide the details of the underlying demand growth for Jackify and Observa to clarify the performance of both brands in Q1. Starting with Jackify on slide 6. In the first quarter, Jackify net product revenue of $572 million does not fully reflect the demand growth as total patients increased 5% in the first quarter versus the same quarter last year, with growth driven by PV and GVHD. Sequential growth versus Q4 was also strong in all indications, as you see on the graph on the right. Jacket-side channel inventory reduction in the first quarter had a negative impact on net revenues of approximately $55 million. Based on the strong patient demand since this quarter and anticipated growth for the balance of the year, we are reiterating our full-year 2024 Jackify net revenue guidance of $2.69 to $2.75 billion. Turning to slide 7 and looking at Jackify total paid demand by indication during the first quarter of 2022, 2023, and 2024. As you can see, total paid demand growth in the top left corner continues to be strong. MF in the top right is consistent year after year, and the largest growth is coming from PV and GVHD. Additionally, JakaFi continues to maintain its leadership and market share in myelofibrosis. Based on market research, total patient market share and discontinuation rate have remained stable in the first line selling. over the past several months with virtually no impact from competitors, which has been consistent with our expectations. Moving to Obcelora. Total Obcelora net product revenues in the first quarter were 86 million, up 52%, when compared to the same quarter last year. The weekly prescription trend, as shown on the right of slide 8, reflects continued growth of Obcelora in both atopic dermatitis and vitiligo, with typical Q1 seasonality. U.S. total prescriptions for Opsalura grew 41% year over year, outpacing the total AD market, which grew 23%. The AD market, including Opsalura, was impacted by the change healthcare cyber attack, particularly in March. Importantly, we are beginning to see in April a rebound in field prescriptions to levels seen before the cyber attack. From an access perspective, we have seen early encouraging results since Obcelera moved in January to preferred position in the CVS network, as TRX growth within the CVS network outpaced growth seen in other plants. Moving to slide 9, as discussed in the past, we are on track to provide 10 high-impact launches by 2030. Importantly, many of the programs highlighted on this slide are de-risked, as they are post-Proof of Concept, including axatilimab, which has been submitted to the FDA for approval, roxolitinib cream in pediatric ED to be submitted to the FDA in Q3, and povacitinib, where we are in Phase III in HS and DT LIGO, and initiating a Phase III study in prurigo nodularis later this year. Moving to slide 10, in addition to our internal efforts to deliver multiple launches by 2030, we recently announced an agreement to acquire Essient Pharmaceutical for $750 million with cash on hand. This acquisition further strengthens our pipeline with two novel first-in-class medicines, EP262 and EP547, which have the potential to treat a broad range of inflammatory disorders. I will now turn the call over to Pablo.
spk22: Thank you, Revae, and good morning, everyone. In the first quarter, we continued to make solid progress across our pipeline, which is focused on three areas, MPNs and graft-versus-host disease, oncology, and inflammatory diseases. In MPNs and graft-versus-host disease, we initiated a Phase I study earlier this quarter where a JAK2-V617F inhibitor. As a reminder, The JAK2-V617F mutation is the most common somatic mutation in myeloproliferative neoplasms and is present in 55, 60, and 95% of patients with MF, ET, and PV, respectively. Unlike ruxolitinib, which inhibits both wild-type and V617F mutation-positive cells, O5H selectively binds to the JAK2-JH2 site, disrupting the V617F-induced conformation and thus allowing selective inhibition of mutant activity in the JAK2 receptor while sparing wild-type. Together with our anti-mutant collar program, these two potentially disease-modifying programs represent a fundamentally new approach to addressing MF, ET, and PV and could help to solidify our leadership in MPNs. As previously disclosed, we submitted the BLA for axotilimab for the treatment in third-line chronic graft-versus-host disease late last year. In February, the filing was accepted for prior review, and we anticipate a decision by the FDA in the second half of 2024. We are excited by the possibility of bringing new treatment options to patients with this devastating complication of hematopoietic stem cell transplant. In oncology, we continue to build out a robust pipeline with the potential to deliver meaningful innovation for patients. This quarter, we initiated a Phase I study with our KRAS G12D inhibitor, INCB161734. 734 is a potent, selective, and orally bioavailable KRAS G12D inhibitor, and as highlighted at ACR earlier this month, it has shown excellent efficacy in several preclinical models. With no currently approved G12D targeting agents, 734 could address an important patient need as a KRAS G12D mutation is found in 40% of pancreatic ductile adenocarcinoma, 15% of colorectal cancers, and 5% of non-small cell lung cancers. In dermatology, we continue to maximize the potential of ruxolitinib cream and povercitinib and believe the acquisition of Essien Pharmaceuticals will substantially expand our IAI pipeline by adding two first-in-class medicines with the potential to address a number of medical needs. The key driver of our interest in Essient is our MRGPRX2 program. MRGPRX2 is a specific novel mechanism for blocking mast cell activation independent from IgE and has been a high priority target to add to our IAI pipeline. EP262 is a first-in-class medicine which entered the clinic in January of 2023 and has been evaluated in Phase II studies. In the Phase I healthy volunteer study, AP262 was well-tolerated, had low interpatient PK variability, and achieved exposures well above predicted efficacious levels. AP262 is currently in a Phase Ib open-label study in Sindhu and in two randomized Phase II studies in CSU and atopic dermatitis. with data for all three studies expected by early 2025. EP547 is a potent and highly selective antagonist of MRGPRX4. MRGPRX4 is expressed on neurons in the dorsal root ganglia and specifically activated by bile acids that are increased in cholestatic patients. Initial evaluation is being conducted in cholestatic pruritus with clinical proof of concept for cholestatic pruritus associated with PBC and PSC anticipated by early 2025. A number of exciting readouts are expected by early 2025, with a potential first launch in CSU by 2029. At AAD earlier this quarter, we presented additional data from the randomized Phase II study of ruxolitinib cream in patients with mild to moderate hydradenitis suppurativa, reinforcing the potential of ruxolitinib cream in this indication. The study at its primary endpoint demonstrated a significantly greater reduction in abscess and inflammatory nodule count compared to control at week 16 and further reinforces the efficacy and safety profile of ruxolitinib cream. We are currently engaging with the FDA to obtain agreement on a potential phase 3 design. We also presented positive data at AAD from the randomized Phase II study evaluating povercitinib in patients with prurigo nodularis and are on track to initiate a Phase III study in the coming months. As highlighted on slide 21, the study met its primary endpoint of a four-graded point improvement in the itch numerical rating scale score, which was achieved by significantly more patients who received povercitinib across all dosing groups at week 16 versus placebo. We believe that with ruxolitinib cream and povercitinib, we will be the only company with the ability to potentially provide both a topical and oral option for a number of indications, including prurigo nodularis, hadronitis suppurativa, and vitiligo. We continue to make important progress in the first quarter by achieving several clinical and regulatory milestones. Within our oncology pipeline, we believe that our potentially best-in-class CDK2 inhibitor is an active agent, and we look forward to sharing data as well as our development plan later this year. In addition, the pivotal trial of tafacitimab in patients with follicular and marginal zone lymphoma, also known as INMIND, will read out later this year, and we look forward to sharing those results. With the BLA for axotilimab submitted late last year, We look forward to working with the FDA to make exotilamab available to patients with chronic graft-versus-host disease later this year and to initiate additional combination studies in patients with less pre-treated chronic graft-versus-host disease. Within our dermatology portfolio, we expect to submit the SNDA for obsolura for pediatric atopic dermatitis and expect multiple data readouts throughout the year. With that, I would like to turn the call over to Christiana for the financial update.
spk17: Thank you, Pablo, and good morning, everyone. Our first quarter results reflect continued strong growth with total revenues of $881 million, up 9% versus the same period last year. Total product revenues of $730 million in Q1 were driven by demand growth for Jakafai and Opsalura, and increased revenue contribution from Monjuvi following the acquisition in February of the global exclusive rights to Tafasitamab. The product demand growth was partially offset by an anticipated reduction in channel inventory for Jakafai and the typical Q1 dynamics for Jakafai and Opsalura. Total royalty revenues, which are primarily comprised of royalties from Novartis for Jakavi and Tabrekta and royalties from Lili for Olumient, were $126 million, up 9% compared to the first quarter of 2023, driven by strong demand for Jakavi. Total revenues include the $25 million upfront payment received under our collaboration and license agreement with CMS for the development and commercialization of polycythinib in China and select other Asian countries. Turning to Jackify on slide 26, Jackify net product revenues were $572 million for the first quarter. Net product revenues reflect continued demand growth, with total patients up 5% year-over-year, driven by growth in PV and GVHD, and continued stable demand in MS. As a result, we experienced the highest quarter pay demand for JAKA5 since launch. As expected, in Q1, we saw patients that were on free drug in the fourth quarter of 2023 return to pay demand and a related decrease in channel inventory levels. As you may recall, channel inventory levels increased by $46 million in the fourth quarter of 2023. In the first quarter of this year, we saw a drawdown in channel inventory, which had $55 million negative impact on net sales versus the fourth quarter of 2023. While we expect channel inventory to remain around the levels we ended in Q1, buying decisions of our customers cannot always be predicted. In addition, net sales in the first quarter were impacted by the typical Q1 higher gross net deductions as a result of both contributions to close the Medicare gap and commercial copay assistance. Turning now to Opsalura on slide 27, Net product revenues for the first quarter were $86 million, representing a 52% increase year-over-year, driven by growth in new patient starts and refills across both AD and vitiligo, as well as early contribution from the commercialization of Opsalura for vitiligo in Germany, Austria, and France. As expected, Opsalura net product revenues in the first quarter reflected the typical Q1 seasonality, and the reset of deductibles and co-pays at the beginning of the year. Beyond the typical Q1 dynamics, Obcelura product revenues were impacted by the Saber attack on UnitedHealth Change Healthcare Unit. Moving on to slide 28 and our operating expenses on a GAAP basis, total R&D expenses were $429 million for the first quarter, representing a 6% year-over-year increase which was primarily as a result of the progression of our pipeline. Total SG&A expenses were $300 million for the first quarter, representing a 5% year-over-year decrease, driven by the timing of direct-to-consumer marketing activities and certain other expenses. Now turning to the acquisition of ASEAN Pharmaceuticals, under the terms of the agreement, we will acquire ASEAN for $750 million in an all-cash transaction. We believe ASEAN's two lead programs offer a multi-billion dollar potential commercial opportunity across multiple indications and have the potential to contribute to our revenue by 2029. In addition, we expect to be able to realize synergies by leveraging our current development and commercial capabilities and infrastructure. We anticipate the acquisition to become effective by the third quarter of 2024 and add approximately $5 million per month in incremental R&D expense. Depending on the timing of the close, we expect the acquisition to add $20 to $30 million to the full year 2024 R&D expenses. Finally, following this acquisition, we'll continue to have a strong balance sheet, which will allow us to consider additional opportunities. As of the end of the first quarter, we have $3.9 billion in cash and no debt. Moving to our guidance for 2024, excluding the impact of the acquisition of Asian and We are reiterating our full year 2024 guidance for Jacopi, our other hematology oncology products, COGS, R&D, and SG&A. Operator, that concludes our prepared remarks. Please give your instructions and open the call for Q&A.
spk05: Certainly. We'll now be conducting a question and answer session. If you'd like to be placed in the question queue, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. If you'd like to remove your question from the queue, you may press star two. Once again, that's star one to be placed into question queue. One moment, please, while we poll for questions. Our first question is coming from Kelly Shee from Jefferies. Your line is now live.
spk24: Thank you for taking my questions. So, for Opsalura, could you give us some more color on the GoToNet for the rest of the year? And what is the latest review trends you see in both AD and vitiligo? Thank you. And I also have a follow-up.
spk17: Hi, Kelly. It's Christiana. Let me take the first part of the question, and then I will turn it to Matteo to comment on the second part. So in terms of the gross-to-net, in the first quarter, it was at the same level as last year Q1, so at around 60%. Going forward, as we have previously discussed, we will not be making forward-looking comments of gross-to-net. Our focus is on maximizing the potential of OPSELURA, and by this I mean maximizing net sales versus looking at gross-to-net in isolation.
spk01: And on the split of business between the two indications, When we look at the IQ via data, triangulated with external and internal sources, we see a 40-60 split consistent over time, where 40% is non-segmental vitiligo and 60% is atopic dermatitis. And we're very happy to see that both indications are growing at quite a healthy pace.
spk24: Thank you. And also, at AAD Dermatology Conference, We saw the data of topical Raxo cream in both early stage one and the two HS patients. Could you share what kind of physician feedbacks do you hear? And also, how do they see it on my needs in both early stage one and the two patients for novel topical drug like Opsalura needed to manage disease in this specific population? Thank you.
spk21: Yeah, thank you for the question. It's Steven. So the milder type of HS still represents about 100,000, 150,000 patients in the United States. It still has morbidity and unmet need, and these patients have abscesses and nodules that cause them, you know, discomfort and morbidity, and lends itself to a topical treatment because it's not as extensive as the moderate and severe, which has fistulas, etc., So, you know, we conducted this POC study and saw this data, which is extremely encouraging in this milder stage of HS in terms of abscess and nodule decreases. And as Pablo said in his prepared remarks, we're now working with regulators to get an appropriate endpoint in this entity for which no drug is approved and has this unmet need I spoke about. To the specifics of your question, the physician and KOL feedback is excellent. I mean, they were surprised by the efficacy seen with a topical agent in this entity. So we're excited about it as well.
spk19: Thank you very much.
spk05: Thank you. Next question is coming from David Lebowitz from Citi. Your line is now live.
spk07: Thank you very much for taking my question. Could you comment on Jackify growth dynamics going forward given IRA and shifts in the out-of-pocket expenses for patients?
spk23: Sure. As you saw from our guidance, 2.69, 2.75, we're very optimistic about the continued growth of Jacify. Obviously, we benefit in the IRA because, as we talked about before, we have the small biotech exemption. So beginning in 2025, for example, with the reduced out-of-pockets for patients, it really just helps the patients, of course, but we don't have to contribute that 20% to catastrophic that other oral drugs will. So we think there's a benefit in 2024 for the reduced out-of-pocket in Medicare Part D being around $32.50 for patients for the entire year, and then next year being $2,000 all patients who are taking oral oncology drugs I believe will benefit, but we continue to see our growth, as Hervé pointed out, coming from PV, GVHD, and in mild fibrosis, we're very stable and remain the market leader in that setting.
spk07: Would you be able to comment further on whether how growth in 2025 might look vis-a-vis 2024 given these dynamics?
spk23: No, we obviously said we're still confident about 3 billion plus by the time we hit 2028. So that's what we're still confident in. And so we think that 24 and 25 should be just fine. Thank you.
spk05: Next question is coming from Kripa de Veracondo from Truist. Your line is now live.
spk19: Hey, guys. Thank you so much for taking my question. On Jackify, Irva, you mentioned that you see very little impact on Jackify share from competitors. Can you talk a little bit about whether the competition has changed the average duration on Jackify? They do go on to Jackify as the front line, but are you observing people getting off of Jackify sooner? And also, for the bet inhibitor combination, It was a recent report of increased AML incidence in patients on the Jackify bed combo for a competitor. I just wanted to get your insights into how this may or may not impact your internal bed program. Thank you.
spk23: So, Kripa, I'll take your first call, and then I'll hand it over to Pablo for the second part of your question. So, for Jackify share from competitors, there really hasn't been any impact on your duration of therapy or discontinuation rates at all certainly in myelofibrosis. So we're very confident. We remain the market leader. Other JAK inhibitors may be used in the second-line, third-line setting. If anything, the market size itself is growing because now patients will go on one, two, three therapies. And I'll hand it over to Pablo for the second part of your question.
spk22: Yes, thank you for the question. So, I mean, obviously I'm not going to comment on data from other companies. Our BET inhibitor program, as we've discussed, is going very well, and we'll disclose additional data over the course of the year, and we're planning a potential pivotal trial going forward, which we'll unveil later this year. Reviewing the data from our internal program, we have at this point no concerns over the safety when it comes to AML transformation. Now, I'm sure you know that if you follow a number of patients with MF for long enough, some of them will have transformation to AML as part of the natural history of the disease. But at this point, we have no concerns with our program.
spk05: Thank you. Next question is coming from Michael Schmidt from Grugenheim. Your line is now live.
spk16: Hey, guys. Good morning. I had a question on PulverCitinib and, you know, again, commenting about another data set. But I just wanted to get your insights on the recent RINVOC head-to-head. study against Tupixent and AD and whether or how that impacts, perhaps, your view on the potential of povacitinib across various dermatology indications?
spk22: Yeah, Michael, thank you for the question. We've seen the data. Obviously, it's an impressive data set. At this point, as you know, we have a number of studies ongoing with povacitinib. We've had internal discussions about the potential to extending the trials of povo to atopic dermatitis. What I can say right now is we're encouraged by the data from RIMBOK. I think that it's an indication that POVO could work very well in this disease. We have not made an internal decision yet as to whether to develop poversitinib in atopic dermatitis yet, but it's certainly something we're contemplating.
spk05: Thank you. Next question is coming from Mark Fromm from TD Cal, and your line is now live.
spk09: Hi, thanks for taking my questions. Maybe to start, one, just following up on the prior bet question, were your comments just based on the clinical data you're seeing in those conservative AMLs, or maybe can you speak to preclinically, because I believe that bet inhibitor from a competitor has shown genotoxicity in some preclinical assays. Has yours shown genotoxicity?
spk21: Steven, answering your question. So, you know, just to reiterate Pablo's remarks and remind you that our BET program was in the clinic a while ago in solid tumors. And then, you know, we've obviously pivoted to study myeloproliferative neoplasms. We've treated, you know, close to 200 patients to date. And in the clinical data set, which is the most powerful, as Pablo said, we have no concern as regards AML transformation or any concerns that we've seen in that regard. from a prior preclinical work on things like AIMS assay and genotoxicity, et cetera, we also have no issue, and we are aware of the issue with the competitor drug that was seen in preclinical work.
spk05: Thank you. Next question is coming from Brian Abrams from RBC Capital Markets. Your line is now live.
spk15: Hey, guys. Good morning. Thanks so much for taking my questions. I wanted to drill down a little bit more on the Jackify dynamics. What's your explanation, or I guess what do you think is the best explanation for the sequential downtick in total jackified demand? Is that something that's just seasonally related that you typically see in first quarter? And then I guess on the competitive front, I'm curious why you think you're not seeing any impact at this point to market share or patient persistance. Is this something you might expect to change going forward, or would you expect market share and persistence to remain stable based on sort of what you're hearing in terms of market research and on-the-ground KOL discussions? Thanks.
spk00: Maybe I can start on the uptake. I mean, what we said, and you can see on the slide, is that, in fact, there is an increase in the number of patients treated across all three indications in Q1 versus Q4. And there is a growth that you can see on the so-called paid demand graph also that shows that versus last year, there is a lot of growth in PV and GVHD. So the unit growth of JAKA5 sequential to Q4 and versus Q1 of last year is there and fairly visible. The reason for the sequential growth versus Q4 is what we discussed when we discussed Q4 a few months ago, is that there was an abnormal free drug ratio in Q4 that has been completely fixed in Q1. So we are back to normal rates of free drug in Q1. Now, on the competitive side, maybe, Barry, if you want to speak of why we don't see the impact of the new competitors.
spk23: BARRY BLOOMBERG- Sure. I think, in fact, the new competitors, let's take Vangio And Momelotinib as examples, as far as we can tell from all of our market research, from all of our experience working with hematologists, they're all being used in the second line setting or maybe in patients that have very, very low platelets, for example. So we anticipate because of really the overall survival benefit of Jacify, because of the tolerability of Jacify, because of the symptom release of Jacify, it's a great drug and it will continue to be very useful to patients who have myelofibrosis going forward. Thank you.
spk05: Next question today is coming from Vikram Purohit from Morgan Stanley. Your line is now live.
spk13: Hi, good morning. Thanks for taking our questions. So we have two, one on limber and then one on Opsalura. So on limber, for the ALK2 POC data set we're expecting to see by the middle of the year, could you just frame for us kind of what the scope and size of that data set is going to be? you know, what you would define as sufficient for continued development for that program based on what we see for that POC data set. And then secondly, on Abcelera, I just wanted to revisit the topic of potential guidance and see when you think might be a good potential time to provide revenue guidance for Abcelera, since you mentioned that it seems like the script shares seem stable between AD and Vitiligo. Thanks.
spk21: Yeah. Hi, Vikram. It's Steven. So on your first question, just a reminder, you know, ELK2's mechanism is felt to work through hepcidin inhibition and then ameliorate, you know, anemia by releasing iron and make it available for hemoglobin production. As we've already shown in multiple presentations, we can decrease hepcidin levels. The question you get into, does this translate to some sort of clinical benefit? Just to remind you of the study, it has three groups, treatment group A, B, and C. A was monotherapy, B was in combination with RUX, but those were in later line patients. And the real focus right now, as you can see on clinicaltrials.gov, is treatment group C, which is the treatment naive group of patients. To see in combination with RUX will help make an effect that will be of clinical benefit to patients, either by raising hemoglobin or preventing the decrease that sometimes occurs with, you know, JAK2 inhibition. And then, you know, if we're able to demonstrate that as we dose increase in the second half of this year, then we'll have a clinical proof of concept that we can then potentially take forward to a regulatory environment. But we'll have to be clear that we are benefiting patients from a clinical benefit point of view in that treatment naive group, and we'll have that data set second half of this year. I'll turn it over for the second question.
spk17: Hi, Vikram. It's Christiane. I'll take the second part. As we discussed on our last call, before we provide guidance for Opsalura, we are looking to have more real-world data on utilization, especially for vitiligo, and data that goes beyond that first initial phase of therapy, which may represent a phase of experimentation by patients. So we are still early into the launch. We are still going through that initial phase of patients on therapy. So we're waiting for more real-world data before we are in a position to give you guidance.
spk05: Thank you. Next question today is coming from Derek Archilla from Wells Fargo. Your line is now live.
spk14: Hey, good morning. Thanks for taking the questions. Just two quick ones from us. I guess, you know, first, just on Jackify, as you noted, you know, the Jackify growth coming from GBHD and PB. So I guess, what does this mean for future assumptions around myelofibrosis? I know you said stable, but, you know, how should we be thinking about that for the rest of this year? And then in terms of CDK2, I guess, where do you think the bar is right now, you know, I guess, from a, you know, TPP? And I guess, what do you intend to show this year for proof of concept?
spk10: Thanks.
spk23: I'll take the first part of your questions, Barry. So for JAKIFY, we continue to see myelofibrosis being, the way I look at the myelofibrosis patient population, you know there's about 18,000 patients, prevalent patients with myelofibrosis. And because we're the market leader, because of the overall survival and symptom benefit that JAKIFY provides, we will continue to think of patients as either being on JAKIFY, which is most of the myelofibrosis patients, or they have been on Jackify, or they will be on Jackify. When they progress on Jackify, then there's other options, fortunately, that are available to them. But going forward for 2024 and beyond, we continue to expect to be the market leader in first-line myelofibrosis. And I'll turn the call over to Pablo.
spk22: Yes, thank you for the question. So, in our CDK2 inhibitor program, we continue to be encouraged by the data that we've seen. Regarding a part of your question about what data we're going to reveal later this year, we're in the final stages of optimizing the dose for the CDK2 inhibitor program. Our idea will be later this year to provide a substantial clinical data set, including the dose selection. For patients initial, the focus will be ovarian cancer, but not necessarily only over the longer term. as well as we are starting combination trials in ovarian cancer, and we continue to enroll patients with breast cancer. So later this year, you will see the dose selection, as well as the data for ovarian cancer, as well as the development plan in ovarian cancer. When it comes to the bar for efficacy, if you look at the CDK2 inhibitor landscape today, most of our competitors have decided to focus on breast cancer or other areas. We continue to believe that ovarian cancer is an important opportunity. Other competitors in this space, like ADCs, are coming into play. We're tracking those closely to figure it out. What is the overlap between the different patient populations with different molecular markers? But basically, in the second part of the year, later this year, we'll provide clarity on dose, schedule, and the development plan in ovarian cancer patients.
spk05: Thank you. Next question today is coming from Jessica Five from J.P. Morgan. Your line is now live.
spk18: Hey, guys. Good morning. Thanks for taking my questions. First, on Opsalura, is it possible to quantify the impact of the change healthcare issue for that product? And what about for Jacobi? Was that impacted at all by the change healthcare issue in the quarter? And then on povercentinib, the phase three study is in vitiligo. I noticed on clinicaltrials.gov, it looks like there's a single primary endpoint of FVASI 75 for the Phase III trials, whereas RINVOC, I think, has two primary endpoints of FVASI 75 and TVASI 50. So what's the rationale for only having a single primary endpoint here relative to the competition, and how do you expect that to kind of play out based on the, you know, endpoints you're studying? Thank you.
spk01: Hi, Jessica. I'll take the Change Healthcare on Obsolura. What we see at the end of February, there was this cyber attack reported that pretty much caused a network interruption for a few weeks. So as a result, Change Healthcare was unable to process the claim for a few weeks. When we looked at, when we deep dive in the data, we saw a softer march when you look at the entire atopic dermatitis market basket that we monitored. and that caused an estimate of four or five million negative impact from Obzellura in Q1. The good news for us is that we're monitoring April, and we see demand, weekly demand, back on track to the levels we saw pre-cyber attack and a little more recently.
spk23: And, Jessica, just on Jackify, we may have actually had an impact from Change House, but we don't know. We did have, when it first happened, some requests from specialty pharmacies that wanted extended terms for payment, but we really can't see a big impact because most of these specialty pharmacies were able to switch over to the other system that provides this service for the specialty pharmacies.
spk21: And then just to address your question on povacitinib in vitiligo, we have two identical phase three studies ongoing, STOPV1 and STOPV2 in patients 18 years or older with 5% or greater body surface area involvement of non-segmental vitiligo. It's a little tricky on the endpoints, but just to tell you, our primary endpoint for the FDA in the United States is actually identical. It's facial VASI 75 and total VASI 50. For other parts of the world, there may be a different primary endpoint. For example, in Europe, they're interested mostly in the total VASI 50. So that leads to some of the confusion. But for our study, for the FDA, it's both. Facial VASI 75 and total VASI 50, you know, together measured at week 52. Thanks.
spk05: Thank you. Next question today is coming from Tazin Ahmad from Bank of America. Your line is now live.
spk02: Hi, good morning, guys. Thanks for taking my question. On Opsalura, can you, and I'm sorry if I missed this in your prepared remarks, but can you talk about refill rates for patients maybe now that have been on therapy for a few quarters? Can you talk about how you're seeing their use of tubes, what the average use of tubes is? I'm just curious that if patients are having good results with the cream, whether they're taking many drug holidays in between when they don't have as much itch, for example. Thanks.
spk00: Yeah, Matteo can add to the comment. I mean, the picture in terms of refill rate has been the following, is that in atopic dermatitis, we have observed a refill that is slightly north of two tubes per patient. And that's relatively stable. Now, it's still increasing a little bit, but it is relatively stable. In vitiligo, it's moving very quickly, and we are not yet at the steady state. It is a situation where we see, unfortunately, that there are patients who are not complying with the treatment as it was prescribed, and we are obviously working with physicians and patients directly to improve it. As you know, from the experience we had in the clinical trial, we are estimating that if we are successful, it will be around 10 tubes per patient, but we are still at the number that is lower than that today. When you try to look at patients who have enough history. So do you want to speak about what we are doing on the marketing side?
spk01: Yeah, the only comment that I can add is on just in this quarter we're launching a very promising adherence program that we're confident will impact, will continue to impact the refill rate growth that we see across both indications, AD and vitiligo.
spk05: Thank you. Next question today is coming from Salveen Richter from Goldman Sachs. Your line is now live.
spk12: Good morning. Thanks for taking my questions. Could you just give us an update on how the ex-U.S. launch of Opsalura is progressing with the addition of France at this point and how you're thinking about the pediatric uptake in 2025? And if I could also just ask one on business development. You know, post the recent acquisition, you still have significant balance sheet capacity. Could we see you do meaningful M&A in the near term on top of Eschant? Thank you.
spk00: Okay, so maybe I'll take the first part about the European launch, because in fact there is a lot of activities going on there. As you know, we launched in Germany and Austria, so that's the base that we have. We recently were part of Accès Direct, which is a French process where you can commercialize your product while you are negotiating the price. So what you see in the numbers today is that there are around 2 million that are recognized sales from France, and it's a sort of a an estimate with a conservative price per tube that we are using to do that. But the process there is moving very well, and we anticipate by the second half of the year to be fully reimbursed and paid for at a good price in France. And we have now in Italy and Spain agreement on the price where we will be launching a between mid-year and the second half of the year in both countries. So Germany, Italy, Spain, and France will be fully operational by Q3 and will be contributing to the top line. There is also some smaller countries in Europe where the process is ongoing, and there is always a big question mark of the United Kingdom, England, where, as you know, the pricing discussion can take more time. And we are in the process there. So it's a very positive outcome for Opselora in Europe because we got reimbursement now in many countries and most of the large countries. And we see a very good uptake of the demand in terms of volume in the countries where it's available, specifically in France. Now, the second part of your question was about the pediatric uptake in the U.S. when we get approval. So maybe, Matteo, if you want to speak about that.
spk01: Yeah, sure. Thanks for the question. And we're very excited about the potential opportunity to help two, three million children in the U.S. And we see data consistent with what we would expect. So pending FDA approval, we are excited by another contribution and tailwind to our top line. This is a patient population that maybe the parents will be a little more sensitive to our box warning, but at the same time, It's two, three million patients and children that we potentially have the opportunity to help going forward.
spk00: On the business side, maybe Christiana, you can... Yes, sure.
spk17: So, Salvinas, as you commented on, we have a strong balance sheet and we'll continue to have a strong balance sheet following the Asian... So as of the end of this quarter, we have $3.9 billion of cash. We don't have any debt, which obviously that could give us additional firepower. So that puts us in a position to be able to look at additional opportunities, and that's something that we are continuing to explore.
spk05: Thank you. Our next question today is coming from Eric Schmidt from Cancer Fitzgerald. Your line is now live.
spk08: Thanks for taking my question. Maybe just following on Salveen's question on capital redeployment, can you talk about your broader strategy there about also whether you consider returning cash to shareholders in the form of a dividend or a share buyback in addition to potentially using cash to expand your businesses?
spk00: I can take that. I mean, we have been speaking about acquisition and external opportunities, which is obviously one very clear goal for the corporation is to diversify our revenue in the future and to increase to the growth coming from the current portfolio that we have. So that's one option. And obviously, as we are doing with our board, there are discussions about alternatives to that. But today... As you have seen with Essient, I mean, there are opportunities that are very much in the range of what we are looking for in terms of timing and in terms of therapeutic areas, and that would be an interest. So we are basically looking at both.
spk05: Thank you. Next question is coming from Jay Olson from Oppenheimer. Your line is now live.
spk20: Oh, hey. Congrats on the progress of your KRAS G12D program. It seems like Insight is increasingly focused on targeted oncology versus immuno-oncology. Can you describe your strategy in oncology? And also, how are you planning to leverage your oral PD-L1 for your targeted oncology programs in combination with your KRAS G12D? Or do you plan to develop additional KRAS inhibitors? Thank you.
spk22: Yeah, so thank you for the question. So your observation is correct. We are moving more aggressively into targeted oncology and trying to shift away from immune oncology. And that's a journey that has started a little bit over a year ago, and we intend to accelerate in the future. The idea here is well-defined patient populations, large treatment effects, ideally single agent activity with early proof of concept, and that will allow us to have much more efficient drug development process to accelerate some of these programs. We're very excited about the G12D program. We think it has the potential to be best in class. And as you point out, one of the things that we can leverage is we have access to what we believe is the most advanced, for sure, oral PD-L1 inhibitor. And that will allow us to do oral-oral combinations in patients with a range of indications. And that applies also to the rest of the pipeline. And as I mentioned, that journey will continue to accelerate in the future.
spk05: Thank you. Next question is coming from Matt Phipps from William Blair. Your line is now live.
spk04: All right. Thanks for taking my questions. I guess I'll ask about the CalR mutant antibody and data in early 2025. Will that be monotherapy or mono and JAK5 combo and also myelofibrosis only or also including essential thrombocytopenia? And I guess just from a high level, the combination with Jackify, is that primarily to provide faster symptom relief, or do you think it is just kind of necessary to achieve full efficacy for the antibody?
spk22: So we haven't decided exactly the scope of the data disclosure for the mutant CalR antibody later this year. What I can tell you is the plan is to combine the mutant CalR antibody with Jackify. And the idea there is, as you know, and we pointed out many times, JAK-FI has a profound effect on symptom relief in these patients, which we believe early in the management of the disease could be very important, even in the presence of a mutant color antibody. The ideal mutant color antibody here, as you know, is to transform, is to change the treatment objective to really eradicate the malignant clone. But still, a potential early treatment or induction with JAK-FI could be very, very helpful for patients. And regarding the other part of your question, yes, we will have data in MF and ET as well.
spk05: Thank you. Our next question is coming from Evan Siegerman from BMO Capital Markets for Line Is Not Live.
spk10: Hi, guys. Thank you so much for taking the question. Two from me. One, just taking a step back, looking at P&L management, you know, how do you think about being most efficient with your OpEx? And then kind of a follow-up there, would you ever consider – using some of your balance sheets to, say, do buybacks, especially with the stock in the 50s. And then just as you think about your positioning in the DERM space, a lot of focus on Opsalura. Where do you want to win over the next five years when it comes to DERM? Where do you think Insight is best suited to really take share? Maybe you can walk me through some of the most exciting parts of your pipeline and your view. Thank you.
spk00: Okay. I think the first question was about the efficiency of the spending. So as you see, I mean, we have in our P&L, we had a relatively, this quarter, we had a very flat SG&A and a relatively slower growing R&D. And that's what we have been speaking about for years now, is basically growing the top line at a faster rate than we are growing both components of the expanses. and increasing leverage so that's sort of happening they are depending on the event on the quarterly it's not always at the same rate but it's clearly the direction that we are taking concerning the buyback i spoke about it what i'm basically saying is that nothing is excluded from discussions and that's uh that's something that uh you know is uh is certainly part of the current dialogue. And now in the dermatology, maybe, Pablo, if you want to speak about the, or Steven, on the... I'm happy to comment.
spk22: Look, I think what we're building is an important portfolio of first-in-class or best-in-class, in some cases, best-in-disease medicines. And I would expand the question, say, in the inflammation space. And I think that was a key driver of the acquisition of SCN to complement that with two first-in-class medicines, 262 and 547, that can really address a range of indications. We believe that that added to the portfolio that we have with povercitinib, which is arguably a pipeline within a drug. We can win across a range of indications by providing patients and payers with a portfolio approach to some of these diseases, including pericardial nodularis, ectopic dermatitis, and now they're neuroinflammatory diseases. Thank you.
spk05: Our next question is coming from Rem Benjamin from Citizens J&P. Your line is now live.
spk06: Hey, great. Thanks for taking the questions. Just a couple of quick ones. One, on Jacobi XR, can you provide any sort of an update as to how that's progressing? And as you think about, you know, the strategy going forward, is this – something that you're already starting to evaluate in combinations, or do you only start doing that after an approval? And then just as a follow-up, just wanted to get your thoughts on the FL-MCL data that's coming out. Is this really going to be meaningful from a commercial perspective? What is the real opportunity in first-line DL-BCL, which is expected in 2025? Thanks.
spk21: So, Ren, it's Stephen answering your question. You know, as Pablo said in remarks earlier this year, the XR process is underway with the regulators in terms of doing bioavailability and then followed by BE work. That'll include stability. So it's about a two-year process, which we expect to complete in a way in time for the LOE. And the idea there is obviously to have the ones daily available in time. It doesn't change any of our FDC work. We can still do fixed-dose combination work. with BET and ELK as we need to do, and we continue to progress those. In terms of tafacitimab, you know, the studies are complete, both in-mind and front-mind. So, the low-grade follicular and marginal zone lymphoma study will be in the second half of this year, and in the first line, the future large B-cell lymphoma, probably in Q1 2025. And we, you know, we await that data. We know we have an active, very active and well-tolerated regimen in lymphomas, and we look forward to that data. As someone also brought up earlier there, and Pablo said, you know, there's also interest now potentially in autoimmune work with CD19 antibodies, and that's something we're just looking at at the moment. You know, to the meat of your question, yes, we very much expect the data to be meaningful with a, you know, well-tolerated active regimen, and we look forward to those data sets.
spk05: Thanks. Thank you. Our final question today is coming from Gavin Clark Gardner from Evercore ISI. Your line is now live.
spk11: Hey, thanks for fitting me in. I just wanted to ask one quick clarification on the CALER data. Did you note that you're planning to show some of that data later this year, or could that still be a 2025 event?
spk22: We haven't provided specific guidance. I think we said 2025. So if I imply 2024, I apologize for my misunderstanding, but 2025 is the goal.
spk05: Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over for any further or closing comments.
spk03: Thank you all for participating in the call today and for your questions. The IR team will be available for questions throughout the day. Thank you and goodbye.
spk05: Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.
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