Coherus Oncology, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the Coherence Biosciences fourth quarter earnings conference call. My name is Michelle, and I'll be your conference operator for the call today. At this time, all participants are in a listen-only mode, and as a reminder, this conference call is being recorded. I would now like to turn the call over to David Arrington, Vice President of Investor Relations and Corporate Affairs. Please go ahead.

Thank you, Michelle, and good afternoon, everyone. After close of market today, we issued our fourth quarter financial results press release. This release can be found on the Coherus Biosciences website. Joining me today for the call will be Coherus CEO, Danny Lanfear, and our Chief Financial Officer, Jean Verret. Before we begin our formal remarks, I would like to remind you that we will be making forward-looking statements with respect to product development plans, all of which involve certain assumptions, risks, and uncertainties that are beyond our control and could cause actual results to differ from these statements. A description of these risks can be found on our most recent Form 10-K, which we filed this afternoon after market close. In addition, Coherus Biosciences does not undertake any obligation to update any forward-looking statements made during this call. I will now turn the call over to Denny.

Thank you, David, and welcome everyone to our Q4 2018 call. We are very pleased today to review with you the progress in Q4 2018, which saw the approvals of the company's first product on November 2nd and the subsequent launch preparations. We're happy to update you today on our progress with respect to the launch, as well as the product pipeline. Our company's CFO, Jean Verret, will then review our Q4 financial performance, and we'll be happy to take your questions. Now, with respect to the launch, I'm pleased to say that we are executing the Udenica launch per plan. We're shipping product and billing customers. Patients are being treated with Udenica. Overall, the sales, logistics, and fulfillment processes fully meet our expectations and are proceeding smoothly. We are pleased that our initial performance is aligned with our internal projections, and we believe that we have successfully presented a robust value offering comprised of a high-quality product Significant Guaranteed Supply, Services, such as Coherence Complete, and Attractive Pricing to the Market. To remind you, the list price of Eugenica is some 33% below that of Neulasta. Our experience to date confirms that our value offering meets the needs of providers, payers, and patients. On a personal note, I just want to say that it's immensely gratifying to see our long-held biosimilar vision now implemented in the field. I recently had the opportunity to visit several oncology clinics and hospitals throughout the country and observe firsthand the value that Udenica is now bringing to the healthcare system. Let me make a few comments with respect to our supply. As per our previous 2018 guidance, our logistics center has ample stock on hand sufficient to fulfill even our highest expected demand for an extended period under any competitive scenarios. As you may recall, Udenica has 36 months shelf life. the longest dating of any approved biosimilar tight-fill grass in the U.S. market. Udenica has been utilized by patients in all three provider segments, oncology clinics, 340B hospital outpatient, and non-340B hospital outpatient facilities. This is consistent with our broad-based launch strategy that we outlined earlier in 2018. Now, with respect to the payers in our previous guidance, As you know, we particularly focused on securing coverage among both Medicare and commercial insurers on both a national and a regional level. To date, Udenica has coverage at parity or better to the reference biologic Neulasta in over 90% of insurers, including all major national payers such as Anthem, United, and Aetna. To our knowledge, there have been no rejected or unpaid claims from any payer. which was an issue with previous biosimilar launches, as you may recall. Finally, it is interesting to note that given Udenica's attractive pricing and comparative value, some payers have adopted policies to prefer biosimilars, including Udenica, over Neulasta. Now on the services side, we launched our full provider-patient offering, Coherus Complete, in early January to support patient access to Udenica. We have resourced all Coherus customer services to accommodate the anticipated demand. I am pleased to report that customer response to Coherus Complete has been very positive and is being very well utilized in the market. With all of our Coherus service offering system, we are supporting medical information requests, reimbursement coding inquiries, as well as requests from patients for copay assistance. And I am very pleased to note that consistent with our mission to deliver healthcare savings and improve patient access, We have already provided underinsured and uninsured patients with Udenica at no charge. Now let me make a few remarks with respect to the adoption and sales. As you know, prior to launch, we expected that a branded, holistic approach to the market, which considers the individual needs of each stakeholder, was the best way to support and nourish biosimilar intake, uptake, I should say, and market conversion. While we are only about two months post-launch, our experience to date has been consistent with those expectations and validated this approach. While we will not provide early metrics with respect to sales today, we are pleased to report that our initial performance is well aligned with our internal projections and our broad launch strategy across all segments. We look forward to updating you in May on our Q1 call when, of course, we plan to report our first quarter sales. Now, let me make a few remarks with respect to the pipeline. And while I understand the Udentica launch is the primary interest, I just want to point out a few things in terms of the developments there. First, I'll discuss our adalimab biosimilar CHS1420. As reported earlier, we have settled with AVI for a launch date in late 2023, and accordingly, we will now sequence and prioritize our BLA efforts for this product consistent with our negotiated launch date. As we have previously guided, it's our intent and strategy to launch our Humira Biosimilar CHS1420 ourselves. We expect that our infrastructure investment learnings from oncology will be highly relevant to the anti-TNF space. For example, the relationships that we're building in the payer space and the patient services delivered by Coherus Complete are particularly important in the anti-TNF space and will find direct applicability. Now with respect to the ophthalmology franchise, CHS 3351, our Lucentis biosimilar, and 33, I'm sorry, CHS 2020, our ILEA biosimilar, we continue to advance our efforts per plan. We believe that the brand and service-oriented approach that we are pursuing in oncology will have direct applicability in ophthalmology as the buy and build market dynamics as well as the potential cost savings to the system are very similar. We're happy to take any questions with respect to the launch. Thank you, Denny. I will now work you through the main financial results for this quarter. Research and development expense decreased by $4.8 million this quarter over the same quarter last year, and by $52.2 million in 2018 compared to 2017.