Blueprint Medicines Corporation

Good morning, my name is Drew and I'll be your conference operator today. At this time, I would like to welcome everyone to the Blueprint Medicine's fourth quarter and full year 2023 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press start, followed by the number one on your telephone keypad. If you would like to withdraw your question, press start, followed by the number two. Please plan to limit your questions to one. Thank you. Jenna Cohen, you may begin your conference.

Thank you, Drew, and good morning, everyone. Welcome to Blueprint Medicine's fourth quarter and full year 2023 financial and operating results conference call. This morning we issued a press release which outlines the topics we plan to discuss today. You can access the press release as well as the slides that we'll be reviewing today by going to the Investors section of our website at www.blueprintmedicines.com. Joining me today are Kate Haviland, Chief Executive Officer, Helena Lee, Chief Commercial Officer, Wadna Mooney, President, Research and Development, and Mike Lansdell, Chief Financial Officer. Christy Rossi, Chief Operating Officer, and Becker Hughes, Chief Medical Officer, are also on the line and available during Q&A. Before we begin, I'd like to remind you that some of the statements made during the call today are forward-looking statements as outlined on slide three and are subject to a number of risks and uncertainties. These may cause our actual results to differ materially, including those described in our reports filed with the SEC. We're cautioned not to place any undue reliance on these forward-looking statements, and Blueprint disclaims any obligation to update such statements. With that, I'll now hand the call over to Kate.

Thank you, Jenna, and good morning, everyone. 2023 was a pivotal year for Blueprint Medicines as we successfully brought forward Avakit to become the first and only approved medicine for patients with indolent systemic mastocytosis, or ISM. As we enter 2024, Avakit will continue to be the foundation of our thriving business, with our early launch momentum putting Avakit firmly on the path to becoming a multi-billion dollar product. Our growing revenue also enables us to invest in additional compelling opportunities in our pipeline to drive longer-term growth and deliver even more transformational medicines in the future. To achieve our goals this year, we're focusing on three key aspects of the business. Let's start with Avakit's blockbuster potential and its ability to drive durable revenue growth for Blueprint well into the next decade. We know that the first few quarters of launch are critical in dividing the sales trajectory for a product. And we have driven a very strong first six months of results in this ISM launch, establishing the foundation for future growth. We have clearly demonstrated our ability to reach patients and drive revenue, achieving $204 million in global advocate revenue in 2023, an 84% increase over 2022. This compelling growth was primarily driven by the uptake in patients with ISM. who comprise about 95% of all patients with SM, a sizable rare disease patient population that we estimate at 70,000 prevalent patients in the U.S. and Europe alone. Today, we are pleased to provide 2024 Advocate Revenue Guidance of $350 million to $390 million, putting us on pace to nearly double our sales this year. This revenue trajectory is very similar to other notable rare disease product launches, such as Solaris and Jacopi, with additional similarities being a compelling new first-in-class medicine approved to address a significant medical need and building a new multibillion-dollar market. These similar attributes and, importantly, similar sales trajectory is why we believe the launch of Avakit in SM is one of the most exciting rare disease launches happening across the industry today. and we are just now scratching the surface. In 2024, our primary focus is on reaching more patients with SM in the US and also now in Europe with our EMA approval in ISM this past December. Avakit's compelling efficacy and safety profile coupled with the chronic nature of ISM mean that both new patient starts and the cumulative effect of patients staying on therapy for longer durations are important drivers of revenue this year and beyond. I will hand it over to Celina next on the call and she'll go into more detail on avocates performance in Q4 and why we expect our strong and steady growth to continue as we drive towards peak sales of greater than 2 billion. And yes, we are now pointing you all to a peak opportunity for advocates that is greater than 2 billion. For the past 12 to 18 months, since before our FDA approval on ISM, we have been citing a peak opportunity for Avakit of greater than $1.5 billion. Now, based on the strong underlying fundamentals that are driving our early sales trajectory and the rapid growth in diagnosis that has led to an expanding SM market, our conviction has grown that Avakit will be able to achieve peak global sales of greater than $2 billion. Now let's turn to our second area of focus. Advancing our portfolio targeting allergic inflammatory diseases where mast cells play a central role. Last month, I shared how we are focusing our investment in our most exciting research and development programs with opportunities to address high medical needs in large patient populations. And importantly, in therapeutic areas that play to our strengths by leveraging our expertise and our infrastructure. A primary area of focus for us this year is to advance our portfolio of approved and investigational programs targeting mast cell mediated diseases. Blueprint is uniquely positioned to drive novel science in this space. Because of our scientific leadership and targeting kit, and our proprietary insights into mast cell biology, an important area of science that has been historically underappreciated. With Avakit and L-amethamib, we are fully covering mast cell diseases driven by mutated kits. And this year, we are expanding into a much larger opportunity driven by wild type kits with Blue 808. We are particularly excited about the potential for Blue 808 to impact fundamental biology in a number of large diseases with significant medical need starting with chronic urticaria. We believe this program will move quickly with a higher than typical probability of success at this stage given our track record of translating our discovery expertise and targeting kit into clinical impact and now commercial success. Next week, we will have a huge presence at the American Academy of Allergy, Asthma, and Immunology meeting, often known as Quad AI, which is the largest allergy and immunology conference in the U.S. and taking place in Washington, D.C. this year. Later on the call, Fuad will go into more depth on what we will be showcasing at Quad AI as well as provide an update on our development stage portfolio. The third area of focus for us is maintaining a strong and durable financial position. Cash management will continue to be a priority area for us to focus on in 2024. And as we sit here today, we see a clear path to profitability through the combination of strong revenue ramp and disciplined operating expenses. which will result in significant decrease in operating cash burn in 2024 and beyond. Mike will talk more about our financial results and our approach to balancing disciplined capital allocation and investing at the same time in our compelling near and long-term growth opportunities. Business development will also continue to be core to how we build and optimize our business in a sustainable way. To that end, I'm very pleased to say that we have made significant progress on a deal that will enable Gavretto to continue to be commercially available to patients in the U.S. while minimizing the financial impact of Blueprint. We look forward to updating you in the near future once that deal is finalized. Now, I'll hand it over to Selena, who will go into more detail on our commercial performance. Selena? Thanks, Kate. Avokit achieved $204.2 million in net product revenues in 2023, representing 84% revenue growth over last year. Fourth quarter revenues grew 30% quarter on quarter to $71 million, with $63.6 million in the US. This growth was driven by several key factors. New patient starts, a decline in our share of free goods, low discontinuation rates, and high compliance. ISM is the clear growth driver. with the majority of new starts at the 25-nig dose. Starting with patients on therapy, we hit a major milestone in January with approximately 1,000 patients on Avakit in the U.S. We were looking to see if this would come in December or January and were encouraged by the strong demand we see coming into Q1. We're thrilled to hit this 1,000-patient milestone this early in the launch, and we're focused on driving continued growth. Today, we're setting revenue guidance that reflects the strong and steady continued growth we expect in 2024 as we get closer to realizing Avakit's blockbuster potential. Our guidance range of $360 to $390 million assumes another year of more than 80% year-over-year revenue growth at the midpoint. We have good insight into the fundamentals driving our revenue, namely new patient starts, compliance, duration, free goods, and our international performance. This range reflects the inherent variability in those fundamentals. With guidance now in place, we're going to move away from providing a quarterly patients on therapy number. We will continue to share commentary on how the launch is progressing. Looking next at persistence. We expected strong persistence in ISM based on Avakit's clinical profile and the chronic nature of the disease. And even though it's early days, All signs point to extended durations of therapy with low discontinuation rates and high compliance launched to date. What's been a surprise upside is how quickly we've moved the needle on our free goods share, dropping to approximately 25% as we grow the number of ISM patients on therapy. We have just reported our second strong quarter of revenue from our ISM launch. Let me tell you why we expect to sustain this growth in 2024 and beyond. Our commercial strategy is grounded in strong continued execution across multiple paths that will drive sustained growth in this market. First, we're ramping up our direct-to-patient marketing to further drive awareness and activate patients to seek treatment. The SM market is growing, and we've only captured a small fraction of it so far. Today, there are more than 20,000 diagnosed patients in the U.S. alone, and about half are not well controlled on symptom-directed therapies. We know this is a chronic market where patient preference is sticky. Once patients start Avakit, that positive clinical experience bodes well for chronic duration of therapy. Second, we're expanding Avakit's prescriber base across all specialties and settings, and we're nowhere near saturation. We are seeing strong receptivity to Avakit's profile among both hemlocks and allergists in the academic and community settings. Threats of prescribing is happening exactly where we want, as we're motivating more allergists to prescribe Avakit, and we're adding more prescribers at the top of the concentration curve. You can see this in the chart on the left, which shows early Avakit adoption among the top 400 SM providers. who see about 4,300 unique SM patients. We continue to grow the breadth of prescribing here in light green, and we're also beginning to see depth of prescribing with providers who have already started two, three, or more patients on therapy in darker green. As we expected, the first positive experience is leading providers to recommend Avakit to the next patients who are coming in for their scheduled appointments. Breadth of prescribing is an important lead indicator for long-term growth. We are highly encouraged to see prescriber breadth and early signs of prescriber depth at this point in the launch. Over time, we expect to see the cumulative impact of growing this motivated prescriber base together with activating more patients to seek what's possible with Avakit. That's why I'm so confident about our ability to both grow and capture this market. We understand the SM market better than anyone else. What activates patients to move away from the symptom-directed polypharmacy they're habituated to and try therapy designed to address the underlying driver of disease? What drives providers' urgency to treat? What influences their prescribing behavior? And how to ensure that access is seamless for patients and providers? We're making great headway to disrupt entrenched attitudes and behaviors about disease control and treatment and to drive patients and providers to take action. With two quarters of strong performance and our guidance today, we are in the early innings of a pioneering rare disease launch. We are exactly where we thought we would be, and we're delivering what we said we would deliver. As we've seen from the launch trajectory of other rare disease blockbusters, We are right on track to capture Avakit's peak opportunity of over $2 billion. With that, I'll hand it to Fuad to share what you can expect from Blueprint Medicines at Quad AI.