Global Blood Therapeutics, Inc.

Greetings and welcome to the Global Blood Therapeutics Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow prepared remarks. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the call over to Steven Emmergott. Please go ahead.

Thank you, and welcome to GBT's conference call to discuss the company's financial results for the first quarter of 2021 and to provide a business update. I'm Steven Inbergut, Head of Communications and Investor Relations. Joining me on the call are Dr. Ted Love, our President and CEO, who will provide an update on our progress in the first quarter. Jeff Farrow, our Chief Financial Officer, will review our financial results. David Johnson, or DJ, our Chief Commercial Officer, We'll give an update on the Oxbrita launch. Ted will then introduce Dr. Kim Smith-Whitley, who joined GBT this week as Executive Vice President and Head of R&D. Kim will provide a view on the current environment for sickle cell patient care. Ted will then close with an update on our pipeline and efforts to expand access to Oxbrita. Earlier this afternoon, we issued a press release announcing GBT's business progress financial results for the first quarter ended March 31st, 2021. Before we begin, I would like to remind you that certain statements we make on this call that are not historical facts may be forward-looking statements that are subject to risks and uncertainties. Information concerning factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements are contained in our SEC filings, including but not limited to our most recent quarterly report on form 10Q as well as in today's press release. Copies of our SEC filings and press releases can be obtained from the investor's page or our company website at GBT.com. The forward looking statements made on this call are only as of the time they are made and you should not place undue reliance on such statements. Future events or simply the passage of time may cause our beliefs to change and we disclaim any obligation to update any forward-looking statements other than as required by law. With that, I'll turn the call over to Ted.

Thank you, Stephen, and good afternoon, everyone. In the first quarter, we continued to make progress on our mission to discover, develop, and deliver life-changing treatments for people with sickle cell disease. The fundamentals of the OxyPytoLaunch remain strong. We continue to see patients benefiting from OxyPrida and increasing real-world experience from healthcare professionals. I'd like to start by highlighting a real-world evidence study presented just two weeks ago at the annual meeting of the American Society of Pediatric Hematology Oncology. Dr. Alan Anderson and colleagues from Greenville, South Carolina, presented data on 76 OxyPrida patients age 12 to 70. For these patients, on average, hemoglobin increased by 2 grams per deciliter. Reticulocyte percent decreased from 11.6% to 6.5%. And total bilirubin decreased by 1.4 milligrams per deciliter. These results are consistent with and exceed the clinically important benefits seen in the HOPE study. Adverse events were rare. Two patients had diarrhea, and one patient had a rash, and all were resolved with dose modification. The real well evidence is consistent with what we've been hearing from many HCPs and adds to our confidence in the long-term potential of VoxPreda. However, as we expected, the COVID-19 pandemic continues to disrupt the daily lives of sickle cell patients and limit their access to healthcare. Sickle cell patients continue to have fewer visits to their physicians and fewer hospital admissions compared to pre-pandemic. In addition, while we are optimistic that the availability of vaccines will improve the environment for sickle cell patients, this will take time. Initial data indicate that the majority of patients are wary of being vaccinated in the early phase of the rollout. All of this is important because the greatest impact to the Oxford at a lunch has been the lack of growth of new prescriptions due to COVID. GBT's product sales, like many companies in our industry, were impacted by the increasing infection rate during the first quarter. we had approximately 950 new prescriptions in the quarter, consistent with the expectation we provided. Let me make an important point. While changes such as inventory levels and growth to net can impact revenues, we recognize in the early stage, we are pleased to see the net number of patients on Oxbrita increasing quarter over quarter. We feel there is light at the end of the tunnel. As we all know, every day more people in the United States are being vaccinated, making progress toward herd immunity. For those with sickle cell disease, we believe that with time, sentiment toward the vaccine will improve. Based on these trends and the momentum our commercial team is building with patients and HCPs, we continue to believe we will see accelerated growth when sickle cell patients are more comfortable reengaging in person with the health care system, which we think should begin to happen in the second half of 2021. Our focus on supporting sickle cell patients, educating patients and physicians on OXBRETA, and developing our innovative pipeline of potential treatment options is stronger than ever. With that, I will turn the call over to Jeff to provide an update on our first quarter results.

Thank you, Ted. Total net revenue from sales of Oxbrita was 39 million for the first quarter of 2021, an increase of 24.9 million, or 177% year over year. As a reminder, GBT recognizes revenue in the U.S. when Oxbrita is received by our specialty distributor or specialty pharmacy partners. First quarter revenue came in below our expectations due in part to more of the new patient scripts coming in towards the latter part of the quarter, driven by the higher COVID-19 infection rate in the first two months of the quarter. On a sequential basis, first quarter revenue decreased by 5% from the fourth quarter. There were two other key factors that impacted the sequential comparison. First, inventory. In the first quarter, our distributors drew down inventory that was built up in the third and fourth quarters of 2020. At the end of the first quarter, days on hand at our distributors was approximately four days lower than a year end. And second, gross to net. In the first quarter, as expected, gross to net increased incrementally to 15% compared to 12% in the fourth quarter. The increase was driven by shifts in payer mix and increased patient copay support as commercial insurance out-of-pocket deductibles reset for patients. Also, as a reminder, Gross to net in the fourth quarter of 2020 included a 600,000 return reserve benefit. The net effect of these items more than offset growth of the number of patients taking Oxbrida, which as Ted mentioned, has increased every quarter since launch, despite flat enrollments over the past couple of quarters and potentially in the second quarter of 2021. In previous quarters, we have not given specific revenue guidance. However, as the pandemic continues to evolve and have an impact, We want to be clear about our expectations for the second quarter. For the second quarter, we anticipate modest sequential revenue growth in the 10 to 15% range compared to the first quarter. Now turning to expenses. HOSTA sales for the first quarter was 584,000 as compared to 135,000 for the first quarter of 2020 and consistent on a gross margin basis year over year. cost of sales was low in both years as the majority of the manufacturing costs related to Oxbrita sales were incurred prior to FDA approval and thus were recorded as R&D expense. We continue to expect that the cost of Oxbrita sales as a percentage of revenue will increase as fully expensed product manufactured prior to the FDA approval is completely utilized, which we anticipate will occur during the first half of 2022. R&D expense for the first quarter of 2021 was $51 million, compared with $40 million for the same period in 2020. The increase in R&D expense in the first quarter was primarily due to costs related to our preclinical programs, including the upfront expense related to the Sanofi and license, our continued research collaboration with pharmaceuticals, and an advancement of our NCLAC and MAP program. We anticipate a sequential increase in R&D expense in the second quarter as we continue to advance our plan to initiate two phase three studies for n-clacomab later this year, which will trigger a $5 million milestone payment by GBT. We also expect incremental increases in R&D expense in both the third and fourth quarter of 2021, driven by the n-clacomab program, as well as the advancement of 601 studies and our other expected pipeline-related activities. SG&A for the first quarter of 2021 was $59 million, compared with $48 million for the same period in 2020. The increase in SG&A expense was primarily due to increased employee-related costs, including non-cash stock compensation and other professional and consulting services associated with the commercialization efforts for Oxbrita. including increased spending on marketing materials. We anticipate a sequential increase in SG&A expense in the second quarter as we continue to ramp up the rollout of new materials to support Oxbrita. We further expect to see a stepwise increase in SG&A expense in the second half of 2021, driven by the rollout of Oxbrita materials, our measured expansion into Europe, and the initiation of multiple investigator-sponsored studies. Net loss for the first quarter was $75 million compared to $73 million for the same period in 2020. Basic and diluted net loss per share for the first quarter was $1.21 per share compared with $1.20 per share for the same period in 2020. We ended the quarter with a continued strong balance sheet and with cash, cash equivalent and marketable securities of $482 million compared with 561 million at December 31st, 2020. We continue to believe that we are operating from a position of strength with a significant opportunity for growth in the future. And with that, I will now turn the call over to DJ.

Thank you, Jeff, and good afternoon, everyone. The commercial team kicked off 2021 with continued progress despite the impact of the ongoing pandemic. As I have done in prior quarters, I will provide an update around the three key metrics combined with net revenues, will give you further insight into our progress. These metrics are new prescriptions for Oxbrita, which informs underlying patient demand, the number of healthcare providers prescribing Oxbrita, which captures the progress we are making in adoption, and payer coverage, which speaks to the access environment for Oxbrita. First, new prescriptions. Our approximately 950 new prescriptions for Uxbrita during the quarter was in line with our expectations and reflects the ongoing headwind of the pandemic. Here are some data points that demonstrate the current environment. First, as Ted mentioned, vaccine hesitancy is a real issue in the sickle cell disease community. In the first quarter, we conducted a survey of more than 120 sickle cell patients, and the results indicate that about one-third are waiting potentially much longer to be vaccinated. and an additional quarter have no current plans to get vaccinated. We are actively educating and helping others to educate the sickle cell community around vaccine confidence. Second, while the use of telemedicine has been helpful for the routine monitoring of our patients, our research shows that healthcare providers in general are less comfortable making treatment decisions such as starting a new therapy via telemedicine. And third, looking across the industry, new to brand prescriptions were down about 10 to 20% year over year in the fourth and the first quarters. Despite this environment, our commercial team has been building momentum to increase demand as we come out of the pandemic. In the second quarter, we expect flat to modest sequential growth in new prescriptions, and we continue to anticipate more significant growth in new prescriptions once the pandemic subsides. Our efforts are focused on educating healthcare providers and patients on Oxprida and providing support to help patients start and stay on therapy. In order to drive demand for Oxprida, our field teams are actively highlighting the long-term, 72-week analysis of the Phase III Hope Study, which was presented at ASH in December and published in the Lancet Hematology last month. And in line with our plans, we stepped up our digital campaigns, which are efficiently reaching our target audiences. In the first quarter, there was a 30% increase in the visits to Oxbrita.com, and our Sickle Cell Speaks disease awareness campaign had 111% increase in website visits and has more than 62,500 followers on Facebook, higher than any other SED page. We are seeing a positive impact from these campaigns. For patients that viewed our digital advertising in the first quarter, More than 3,300 patients visited a hematologist within one month after seeing an ad. Turning to adherence, which includes both compliance and persistence. Oxbrita trends continue to be well within the range of our analogs. In addition, we continue to focus on ways to increase adherence, including by recently launching new get-started guides and brochures that support patients' discussions on Oxbrita. We also introduce new patient kits for those starting therapy. which includes treatment journals, side effect management tip sheets, smart bottle cap stickers, a smartphone app, and alarms. In addition, we transitioned GBT Source solutions to a 100% high-touch model, resulting in better conversion and adherence rates. Data from our experience in supporting patients has been submitted to the Foundation for Sickle Cell Disease Research Conference to be held later this month. To complement this, in February, we launched our gbtsource.com website, which provides information about starting and staying on Oxbrita. We continue to learn and invest in patient support and are motivated by the high levels of satisfaction reported in our patient and healthcare provider surveys. In order to extend the benefits of GBT Source and our support tools to as many patients as possible, we are working with our specialty pharmacy partners to provide key services during their interactions with sickle cell patients on Oxbrita so that patients have multiple avenues to receive the support that they deserve. Overall, we believe these initiatives will continue to build awareness with patients as well as support more physicians prescribing Oxbrita while also helping them keep their patients on therapy. Our market research also continues to support the strong fundamentals of Oxbrita. For example, when we ask Oxbrita patients about their experience, a high majority believe it is easy to take, works well, and increases hemoglobin. Looking at the profile of Oxbrita patients, we continue to see a broad range of baseline hemoglobin and VOC burden among our patients from claims and lab data covering over 2,500 patients. Encouragingly, 50% of the Oxbrita patients have baseline hemoglobin levels greater than 8 grams per deciliter, suggesting that healthcare providers are increasingly recognizing the importance of addressing polymerization and long-term health. Which leads me to my second metric, healthcare provider penetration. As we entered the first quarter, in-person interactions with healthcare providers by patients and our field team continued to be limited by the increase in new COVID-19 cases. As we progressed into March, the environment gradually improved and we had a 15% increase in overall field engagements compared to the several months prior, mainly driven by improved in-person access to healthcare providers. During the first quarter, we also completed more speaker programs than any quarter since launch. field teams have been actively engaging with existing and potential new prescribers to highlight our new data and educational support materials the engagement and feedback on this activity has been encouraging we added about 170 new prescribers in the first quarter bringing our total prescribers to around 1 550 since launch when we look at the breakdown of riders we continue to see prescriptions being written by both specialists and non-specialists, which we believe is a positive trend for the long-term trajectory of the launch. And there continues to be tremendous opportunity to go deeper with these riders and to develop new riders from our large target list. Turning to the payer coverage, as we previously reported, in 2020, we achieved broad coverage with 90% of covered lives in the United States. Our focus is now on working to optimize coverage, and we recently received great news from Texas. a state with one of the largest sickle cell disease patient populations, that they voted to add Oxbrita to their preferred drug list going forward. On a related note, we are also sharing data supporting the potential clinical and economic value of Oxbrita and raising hemoglobin levels. In April, a poster presented by Dr. Bill Erschler at the Academy of Managed Care Pharmacy meeting highlighted a large-scale longitudinal analysis demonstrating that increased hemoglobin levels significantly reduce the risk of end-organ damage for sickle cell patients. In summary, we are well-positioned to drive and support incremental growth as more sickle cell patients begin to re-engage with their physicians in person, aligned with our ongoing confidence in the long-term potential of Oxbrita. I will now turn the call back over to Ted.

Thank you, DJ. It's exciting to hear about all the new materials campaigns and initiatives we are deploying in the field. Before I get to our pipeline, I'm pleased to bring in the newest member of GBT's leadership team, Dr. Kim Smith-Whitley. Kim is on day three at GBT, and she joined the call to say a few words. Kim.

Thanks, Ted. I am thrilled to be here today as part of the GBT team. Over the years, I've developed a great respect for the company as an investigator, a clinician, and an advocate for patients. The shared dedication to sickle cell disease across the organization has made for a smooth transition, and I am proud to be joining GBT in its journey. I want to provide some additional perspective on the current environment for treating sickle cell patients based on my experience and feedback from my peers. For so many patients, including those that I have seen in the clinic, the challenges created by the pandemic have severely impacted their daily lives from employment to healthcare to family life and beyond. This dynamic extends to care seeking behavior. I am fortunate to have spent the last 29 years at Children's Hospital of Philadelphia or CHOP. which is unique as a comprehensive tertiary care academic center that is very well staffed. Recently, the team there has seen some patients come back in for their routine visits. That is encouraging news, but for most sickle cell care settings, this is going to take more time. I would validate what Ted and DJ said about COVID vaccination among sickle cell patients. In my practice and others, it has been common for sickle cell patients to be hesitant initially about taking the vaccine. However, we are hopeful, as with other vaccines, that this will improve. That said, with increasing momentum and information, more opportunities to get vaccinated, and a decreasing risk of transmission over time, I do expect that a broader group of patients will return for in-person care. It's hard to say how long that will take. It will vary based on geography and care setting and may lag the general population. But one thing that I am extremely confident in is Ocpritus placed in the treatment armamentarium for sickle cell disease. With more experience using the medicine, I believe Oxbrita will continue on its path to becoming a standard of care for these patients. And while I'm very excited about Oxbrita, I'm even more excited about the future of GBT with an exceptional pipeline that I aim to continue to build and grow. I will now turn the call back to Ted.

Thank you, Kim, and welcome. We're so excited to have you as part of GBT. Now, let's get to the pipeline. First, N-Clacomab, our P-selected inhibitor that has the potential to be dosed quarterly. This is a very meaningful improvement for patients compared to the current option, which requires monthly dosing. We are on track to initiate two phase three studies for N-Clacomab by mid-year. One is focused on reducing VOCs over a 48-week treatment period. And the other is focused on reducing 90-day hospital readmission following an initial VOC hospitalization. These two studies are designed to potentially enable two independent regulatory submissions for separate indications. Moving to GBT601, our next generation hemoglobin polymerization inhibitor, we have enrolled participants in a healthy volunteer study, and our goal is to have proof of concept data in sickle cell patients by year end. If the preclinical data for GBT601 play out in the clinic, we believe it would be positioned as a best in class therapy with the potential to provide a functional cure in a once daily pill. In the first quarter, we also bolstered our pipeline with the in-license of two early stage small molecule programs from Sanofi. The mechanisms targeted by these programs are distinct from OXPRATA, expanding our long-term potential to transform treatment of sickle cell with multiple complementary therapies. Turning now to our other growth initiatives. In the United States, we are seeking to expand to include children age 4 to 11. Expanding to younger patients is a top priority as we believe that mitigating red blood cell sickling and destruction early in life could modify the course of the disease and alleviate serious and life-threatening complications. Turning to Europe, we remain on track with the European Medicines Agency's continuing review of our marketing approval application, which we anticipate will be completed in the first half of 2022. Currently, physicians can gain experience with Oxpreda through our early access program for eligible patients in Europe and other regions outside the United States. In the six Gulf Cooperation Council countries in the Middle East, we are working with our partner BioPharma MEA to make Oxprida available, and we have a goal to establish a similar partnership in Latin America, including Brazil, where the bulk of the region's sickle cell patients live. Altogether, our label and geographic expansion plans are intended to give us the opportunity to reach more than 350,000 sickle cell patients around the world over the next several years. And as we make progress against this goal, we continue to explore strategies to bring OxyBiota to patients in limited resource geographies such as Africa and India. In closing, GBT continues its leadership in sickle cell disease and is well positioned for long-term success. We have near-term opportunities to expand into younger patients in the U.S. and to secure regulatory approval in Europe. We also have a robust pipeline and two potential best-in-class medicines, enaclacumab and GBT601. I am proud to be part of the GBT team and want to thank our employees for their passion and dedication, which is essential to realizing the potential of our medicines. We are unified in our commitment to the sickle cell community And every day, we are getting closer to our goal of transforming sickle cell disease into a well-managed condition. With that, we'd like to open the call for questions. Operator.

At this time, we'll be conducting a question and answer session. If you'd like to ask a question, please press star 1 on your telephone keypad. We ask that you please limit to one question and re-queue. A confirmation tone will indicate your line is in the queue. You may press star 2 if you'd like to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Our first question comes from Althea Young with Cantor Fitzgerald. Please proceed with your question.

Hey, guys. Thanks for taking my question. Obviously, it's around the launch. So you've seen March. You've seen now April. you know, it sounds like trends were softer in the first two months. I guess, you know, to hit this, like, maybe growth in new scripts next quarter, like, what do you think kind of anecdotally kind of has to happen or continue to happen is one part of that question. Obviously, the second part of that question is just, you know, what you were seeing in March and April. Thanks.

Hi, Alicia. This is Ted. So, obviously, we don't want to report on the next quarter quite yet, but I would just emphasize that we continue to feel very encouraged about where this is ultimately going to go. The biggest headwind for us continues to be that patients are not interacting with their doctors. In fact, we have good evidence that in Florida and other places, the physicians are actively telling the patients to stay home, not risk getting on public transportation, not risk being around people that increasingly are not wearing masks and get infected. But all of this is going to turn around. So we feel great about the long-term future, but we don't want to set expectations too early. What we've said all along is that we thought the second half of the year was really where we would expect growth. We really felt like the first half of the year would likely be flat. And we've basically seen that, although we do feel that we can signal that we think 10 to 15% growth in revenues in the second quarter versus the first quarter, we think that's very realistic for us. And we wanted to let everyone know that. And we are growing prescriptions, as we mentioned in the script. We are actually increasing the number of patients each quarter that are on OxyPreda.

Great. Thank you.

Our next question is from Akash Tewar with Wolf Research. Please proceed with your question.

Thanks. I have a few. I guess, stepping back, why hasn't Oxbrida kind of launched well in severe patients who have high transfusion burden? Since theoretically you're keeping these patients out of the hospital, has there been any effect on the Novartis launch where you kind of have a more immediate impact on VOC that may have limited uptake for Uxbrita. Number two, for 601, how come that compound hasn't been run head-to-head with Uxbrita in preclinical assays? And it seems like in terms of HP occupancy, it tops out kind of in the low 30s, but it does seem to have a a pretty big difference in red blood cell half-life and hemoglobin levels. So what is going on specifically with that compound that's allowing you to do that? And why are kind of the occupancy rates topping out in the low 30s? And then kind of lastly, just, you know, you mentioned sequential growth of 10 to 15% in Q2. You're also noting that there is a lot of vaccine hesitancy, and particularly in the African American community. So what specifically gives you confidence on that 10% to 15% growth that you got today?

Thank you. A lot of questions. I want to make sure I try to walk through them all. So not a lot of sickle cell patients are on chronic transfusions that can necessarily be stopped. We have seen many people that are on chronic transfusions discontinuing. Kim, feel free to add to this from your experience. But for example, if somebody is on chronic transfusions due to a stroke, those individuals may need to really stay on transfusions. And we prove, as we're trying to do in the Hope Kids 2 study, that we're providing protection against stroke. But we have many, many patients, and we've reported on this, that many patients have reduced and or completely come off of transfusions on Oxybride. And those are patients that typically you're transfusing them because you're trying to maintain hemoglobin levels that are more acceptable so that the patient can have adequate energy to get around. They're not the patients that are necessarily on protocol due to a prior stroke. So I think we are having success there. Your question about hemoglobin occupancy, It didn't top out. That was the highest dose that we studied. It was 150 milligrams a day. We can actually get 100% modification, and we readily do it. In fact, many of the animals in our tox studies actually have 140% modification. We can dose high enough safely that 40% of the hemoglobins actually accept two 601 molecules. So we have a lot of luxury and capability to dose as high as we want. The reason we stopped at 30% is you can see the animals are effectively cured. Their reticulocyte counts are normalizing. Their hemoglobin levels are actually higher than the animals with sickle trait. So the data really looks like you've essentially cured these animals, but we can go higher, but the data is unlikely. to get much better than curative effect. And then finally, on the 10 to 30%, maybe I'll just defer to Jeff, if you want to add any comments about that. Sure. Hi, Akash.

There's a couple things that are really impacting our comfort on that 10 to 15% range. The first one is really what Ted alluded to earlier in the prepared remarks is that There's a growing net number of patients that continue to be on Oxbrida. And as that number grows in the aggregate basis, we continue to see revenue growth. So that's one aspect that we'll see as we emerge from Q1 into Q2. The other aspect is we do anticipate relatively flat NRXs, although we've seen that that is improving coming out of the latter half of March. So given the trends, we don't think with some of the infection rates coming down that that is going to impact us on a negative basis. So those are the real two major items. And then it seems like we don't have a long enough history at this point to sort of point to, but we do think days on hand is going to somewhere hover around the 20 to 22 days as opposed to what we saw at the year end and having a resulting drawdown that impacted us here in this first quarter. We don't expect that in the second quarter.

And Kim, do you want to add anything regarding transfusions?

No, Ted. I think that really you said the main features of what we've seen. I just want to reiterate that those individuals who are on a regular or chronic red cell transfusion for indications other than preventing neurologic complications have really been able to come off of transfusions altogether with Oxbrita or significantly reduced the number of units or the frequency with which they receive transfusions on Oxbrita. So, very encouraged by what we've seen in this population.

Thanks so much.

As a reminder, we ask that you please limit to one question and re-queue. Our next question comes from Ritu Baral with Cowan & Company. Please proceed with your question.

Hi, team. This is Lila on for Ritu, and thank you for taking the question. Hi, Lila. Hi. And just to quickly ask you to follow up on the current trends that you're seeing with adherence. Now, you said it's within the range of typical analogs, but are you seeing an improvement in impact through the high-touch model? And then what proportion of your estimates for that growth of 10% to 15% in Q2 is driven by improvements in underlying compliance and adherence? Thank you.

DJ, you want to take that? Sure. Hi, Lila. We are seeing adherence rates stable in Q1 to previous quarters. So not a lot of news there. We're well within the range of the analogs that we've talked about in the past of that 50 to 70% one-year adherence rate. So that hasn't changed. You're referring to a bunch of tactics that we've talked about that we rolled out. But most of those tactics rolled out in late Q4 or in Q1. So things like the get started guides and brochures, the starter kit that include a bunch of adherence tools, such as the, you know, the smart bottle cap stickers, the smartphone apps, that sort of thing. And then the high touch model that we've implemented for all patients that come through our hub, those all started really in earnest in Q1. So it's a little early to have data on that, but we do have insights. We know, for example, the high touch model worked better than the low touch model or no touch model last year. we saw a lift in adherence for those patients that went through that program. So that's why we've shifted to that this year. So we fully expect all of these tactics to have a positive impact as we get into the second half of this year. We'll be sure to update you on that.

Thank you. That's very helpful. And so does that mean you're modeling that to be consistent in Q2 for that 10% to 15% increase? Just want to make sure I understood you correctly.

Yeah. Yes, absolutely. That's the same adherence rates that we've been talking about. We would expect that in Q2.

Okay. Thank you. Very helpful.

Our next question comes from Gregory Renza with RBC Capital and Markets. Please proceed with your question.

Hi. This is for Greg. Thank you for taking my question. It's great to see the broad payer coverage for so far. I was wondering, since there's usually a six- or 12-month limit for access, how do you think about keeping patients on therapy when, you know, their reauthorizations are potentially coming up? Thank you.

Great. I don't think that's actually been an area of concern, but, DJ, you may want to elaborate on that. Sure, yeah.

The reauthorizations are actually a really good story for us. You know, most payers do want to check in at the six-month mark or sometimes the one-year mark. to see how patients are doing. And it's usually a light prior authorization where they check in with the physician. Usually there's a list of things that they ask. And in our case, since we have a lot of really good metrics in our label around hemolysis and hemoglobin, that if any one of those things is in the positive direction, then they have been approving therapy to continue. So I'm not aware of any patients being discontinued through a reauthorization process at this time. It's been... really good coverage and our ability to work through those. And then our hub, our patient support hub, GBT Source Solutions, helps with the process in the sense that at year end, for example, reauthorizations of insurance, of co-pays, that sort of thing. We were able to manage that ahead of the year end last year so that patients were aware that we could reset their co-pay assistance cards through our hub. And so we really didn't see a significant drop off because of the reinitiation of co-pays and that sort of thing at year end. So, you know, we just plan ahead with our hub and able to see it coming. So hopefully that helps.

Great. Thank you very much.

Our next question comes from Jason Gerber with Bank of America. Please proceed with your question.

Hey, guys. Thanks so much for taking my question. So my question is, you know, as we talk to physicians, it sounds like the coverage of Oxprite is good. If there's one challenge for some, it's that it's an either-or decision between Adaxio and Oxprite. So if you have physicians who might be more favorable to Adaxio, it may be challenging to get Oxprite. And so I'm just curious, you know, if that mirrors your feedback, your understanding. And then as we look longer term, you know, just trying to get your sense of the value of having Oxbrita and a Selectin blocker both in-house with your own portfolio and being able to kind of manage both of those and perhaps drive better access that way. Just curious. Thanks.

Right. Well, DJ, you may want to comment on anything you've seen in the field, but I would just say that the first point to keep in mind is that drug actually, these drugs actually have different indications. So there really isn't a scientific reason that a payer would object, because Adacvio is indicated to reduce the number of VOCs. Oxbrita is actually approved to treat the underlying nature of sickle cell disease, really with the intent that you will improve oxygen delivery, protect organs from the inevitable death that we see of organs, and the premature death of the patient. They are truly different indications, and I know there are patients that are being prescribed both drugs. Now, a physician might think that the VOC is the bigger issue that they want to focus on first and may want to use a dactyl first, but that really shouldn't, I think, deter a physician from wanting to treat the underlying disease because, you know, these patients typically are dying in their 40s, in their 30s and 40s. And that's really what we're trying to change by fundamentally treating the polymerization. But DJ, if you had one thing to add from a payer perspective.

Yeah, just to remind folks that we have about 40 to 50% of our utilization of Oxypride is in combination therapy. And a lot of that's hydroxyurea, but a fair amount of that is already with Adacvio. The low double digit percent is actually in combination with Adacvio. So Ted's exactly right. There's no kind of mechanistic reason these can't be used or indication reason they can't be used together. And in fact, they are being used together in some patients. That said, there's not a lot of clinical data of them being used together. And so a payer will oftentimes ask a lot of questions about new therapies without a lot of data. So yes, there tends to be prior authorizations and maybe a couple of extra steps to get approval, oftentimes a an appeals process. But generally, when the physician and patient really want to get that combination used and they work with our hub and our patient team, we're generally able to get it approved. It just takes a few more steps until we have more data.

Got it. Thanks.

Our next question comes from Andreas Argarides with Wedbush Securities. Please proceed with your question.

Thanks, operator. Good afternoon, guys. This is Andreas Argarides. My question is around the telemedicine. How much of sales in the first quarter can be attributed to telemedicine? And then if the pandemic persists longer than anticipated, what are your strategic plans to, I guess, leverage telemedicine efforts in that case? Thanks.

It's a great question. I mean, we've actually always assumed that we would work to make telemedicine work because physicians are using it. In fact, I think many people think telemedicine is going to continue to be part of medicine going forward after the pandemic. So making that work well is something that's important to us. There is some limitations, however, among physicians around starting completely new drugs in the setting of telemedicine. Some physicians are perfectly comfortable with that, and we've obviously had more success with those physicians than with physicians that are reluctant to do it. But quantitatively, DJ probably has some data on that that he could share with you.

Yeah, in just a few of the figures, we have seen an increase in our overall engagements with physicians in Q1. March was our strongest month in Q1. And our field activity in general, both telemedicine and face-to-face, did go up in Q1. Actually, our engagements are back to pre-COVID levels. So the number of interactions with health care providers in Q1 reached pre-COVID levels. Now, the majority of those interactions still are. through telemedicine. We are getting more and more face-to-face depending on COVID dynamics in the geographies, but we are fully set up and operationalized. And we're very early on in the last year in the pandemic at becoming operational in a telemedicine world. So all of our materials, all of our education, our strong focus on social media and digital for education as well, it's all set up for this environment. but Ted's exactly right. Our preference is to do some more in person because that tends to also mean patients are in person. And we do have, uh, you know, our internal data that, that shows that both when our reps are in person and when the patients are in person, it's easier for a physician to get educated and to prescribe OxyGryda. So that's our preference is to work, you know, diligently to, uh, to have more in-person engagements, but should the pandemic continue to, uh, you know, to proceed as is, we're fully ready and able to continue to operate in this environment as long as necessary.

This is not an extra question, just reiterating the prior one. Can you break out sales from telemedicine or?

We really can't. We can't really. So when a prescription comes in, there's no way of knowing if the physician was seeing the patient through telemedicine or not on the prescription itself. What we do know is we saw a significant increase through the pandemic in electronic submissions of prescriptions to our hub. And generally that we, in talking to physicians, that's associated with having more virtual engagements with patients where they're doing everything digital. And so clearly they're doing more prescriptions through telemedicine than they ever have before. But the preference is still to do in person.

Our next question comes from the line of Danielle Brill with Raymond James. Please proceed with your question.

Hi, guys. Thanks so much for the question. So I guess maybe if you could just help me understand a little bit more about your guidance for flat NRX into Q. you were seeing an uptick, or if the majority of your NRX came in March, and then I think you mentioned you saw an uptick late in March. I'm just curious why you're not confident that that trend will continue over the course of 2Q. Are you just being conservative, or is there more to this dynamic that I'm not understanding?

No, I think, I mean, the truth is, Daniel, hi, Daniel, this is Ted. And these things are very choppy and obviously we're not getting the kind of growth that gives you confidence to predict the numbers will go up quarter of a quarter. And we think it's really prudent to kind of stable what we've been saying, which is the enrollments are likely to stay in this 1000 range. You know, we may be a little under, we were 950. I think the last two quarters. We might be a little over, but we're not gonna get to the kind of growth that we need to get to until patients start going back into doctors. And quite frankly, doctors allow their patients to come back in to be seen directly. So we think that that number is not really conservative. We think it's realistic though. And we've proven a capacity to be at those numbers in the setting of the pandemic. what we need to happen, quite frankly, is not just for COVID cases to go down. We need patient behavior to change. So the COVID cases could go down, but the patients are still not going in to the doctor. That's really the triggering event for us. Now, we expect all that to happen, but we don't know the exact timing. So we're comfortable holding to 1,000, as DJ said, which is really through telemedicine primarily.

Our next question comes from Yannan Hu with Wells Fargo. Please proceed with your question.

Hi, and thanks for taking my question. Just to have a quick one, I think in the past you provided a number of patients on therapy. I might have missed this, but did you give the number of patients on therapy this quarter?

Nope, you've never missed that because we've never given that.

Any reasons for no longer providing that number?

Well, I mean, we have, obviously, like many companies, a thoughtful process for figuring out which metrics you report. And we kind of work through that, quite frankly, with our board as well on the metrics. And we continue to talk about it. But that's not a metric that we've ever provided. contemplated reporting on. The metric that we want to get to, quite frankly, is revenue guidance. That's what we're trying to get. And that's going to be a much simpler metric. It's just hard for us to get there in the midst of the pandemic. But the metric we want to give you, quite frankly, looking forward, is revenue.

Our next question comes from Ben Burnett with Stifel. Please proceed with your question.

Hi, good afternoon. This is Neil Carnahan on for Ben. We're just wondering if you guys could provide some color on the refill rate that you're seeing and maybe the average number of bottles per patient during the quarter.

Again, I think those are metrics that we have not reported in the past. And I don't know if, Jeff, you want to add anything to that. But those are not metrics that we've reported. want to take on as an obligation to report every quarter.

Yeah. Maybe one thing I will add, this is DJ, um, is that we continue to have good, um, uh, process times and cycle times, uh, two weeks or less from the time the prescription comes in to get fully worked up prior off and shipments to a patient. Our conversion rate from a script to a, to a bottle is still high, 75% or so. And our compliance rate is still high, meaning that, um, You know, we've always said that once a patient starts on therapy, they generally take it as prescribed and refill that bottle within that 30-day window. We continue to see that. Persistency is the other piece of adherence that we look very closely at, and that's something that every chronic therapy is always working on. And those two things together, compliance and persistency, make up that adherence range that we talked about, that 50% to 70%. So hopefully that's helpful.

Our next question comes from Paul Chow with Goldman Sachs. Please proceed with your question.

Hi. Thanks for taking our questions and good afternoon. It's great to have Kim on the call. And Kim, I guess, you know, as a clinician transitioning to industry here, could you maybe just sort of comment on what, you know, as a clinician you'd like to see for the early 601 data later this year and then as we go into patients after Healthy Volunteers, just sort of framing some guideposts there? Thank you very much.

Thank you for that question, Paul. I really would like to say that the hope for 601 is that we will continue to see data that suggests better comparisons to what we've seen with OXBRIDA. And I think that we hope that we will see data that supports that 601 will continue to have a same but stronger impact to Oxbrita. And we might even look to see whether or not there are changes in some of the side effects profile. So I think that that's what we're going to be focusing on for the end of this year.

Our next question comes from Yatin Sonia with Guggenheim Partners. Please proceed with your question. Okay, our next question comes from John Newman with Canaccord Genuity. Please proceed with your question. John, are you there? Okay, our next question comes from Yatin Sonia with Guggenheim Partners. Please proceed with your question.

Hey guys, thank you for taking my question. Can you hear me now?

We can, yeah.

Perfect, yeah. Can you provide some color on the penetration you might be or you might have achieved in various subsets of patients, you know, like patients that have hemoglobin below 8 or patients below 10.5 or maybe above that? If you can give, you know, some sort of a commentary there. And then maybe a broader question, if we step back and think about, let's say, peak market share, do you envision Oxbrita treating a similar number of patients that get hydroxyurea? I think it is our understanding that about 25,000 to 30,000 patients are on hydroxyurea in any given year. So can you reach that level with Oxbrita and in what time frame?

Those are great questions, John. And so I would say at a high level, we've always felt that getting to those levels is achievable because, quite frankly, the data suggests that OxyCrata has a better safety efficacy profile. It doesn't have a black box warning around cancer risk. Patients feel better on the drug very quickly. And the side effect profile, as you know, is better. So we definitely think long term. getting to that level is achievable. It's obviously all been delayed significantly by COVID, but we do think that's the bogey long-term. In terms of penetrations in the various subgroups, my sense is that we're very early in all of these. That's good news. We've still got a lot of growth in every segment, whether people with high hemoglobins or low hemoglobins. But as DJ said, we're already seeing the prescriptions for OxyPreda begin to really reflect the label, which is it's for treatment of individuals above 12 years old to treat their underlying sickle cell disease. And quite frankly, your hemoglobin should not be a barrier. And ultimately, it won't be a barrier. But DJ, do you want to speak anything quantitatively about subgroups? I know it's early.

Yeah, we do a chart audit and claims database audit with over 2,500 patients. And that's where we get our figures that over 50% or approximately 50% of our patients on Oxbrita had a baseline hemoglobin greater than 8 grams per deciliter. So about 50% were less than that. And so it looks like physicians are comfortable using Oxbrita in many different hemoglobin levels. We have patients that are above 10.5 in that database, baseline hemoglobin. We have patients that are between 9 and 10.5. And we have patients, of course, between 8 and 10.5. So we have a broad utilization of Oxprida, which we think is great. We certainly are indicated for all patients with sickle cell disease. The other penetration number we're certainly excited about is that only about 25% of the patients in the practices of the physicians that have tried Oxprida to date, that 1,550 prescribers, only about 25% of their patients have been utilized Oxprida on. So we still have 75% of our existing treaters' patients for Oxprida to be used in. And that's a great opportunity to go deeper with physicians that already have experience with Oxprida. So you can imagine that's a big focus of ours. And we also are looking to penetrate into more physicians coming online in this quarter to prescribe Oxprida for the very first time. So we have a large target list, but new prescribers we're still developing.

Our next question comes from Matthew Harrison with Morgan Stanley. Please proceed with your question.

Great. Good afternoon. Thanks for taking the question. I guess I have a sort of, I'm just looking for your perspective on sort of a longer-term question, which is as follows. So we've obviously been talking about throughout the whole pandemic how, you know, patients aren't going in, but it does sound like physicians at least have some sort of interaction with patients. And so I guess my real question is, once patients start to go back into the office, why isn't there going to be a large bolus or a significant backlog that has building, you know, our physicians keeping lists, things like that. I'm just wondering why we wouldn't see a very significant snapback in terms of growth once you start to see large numbers of vaccinated patients heading into the office?

Yeah, no, it's a nice aspirational question, and we love that. And Matthew, that may happen. It's just that as for a guidance perspective, we're not really sure what's going to happen after the pandemic. We're not really sure if people are going to continue to be, you know, somewhat conservative for a while. I do think that you are right, that as we educate more and more physicians about Oxprida and they have the intention of using it and they have a group of patients they haven't seen that would represent certainly a potential reservoir of individuals. We just don't know what the curve looks like. And that's why we want to be thoughtful about not trying to set expectations that we don't deliver on because at the end of the day, this is going to really be driven by the patients getting back into the office and having that interaction to get the prescriptions.

Our next question is from June Lee with Truist Securities. Please proceed with your question.

Hi. Thanks for taking our questions. And a lot of the questions haven't asked, but maybe the recent deal with Vertex you know, that they did with that for genome editing drug for sickle cell disease and beta thalassemia. You know, CTXO1 specifically implied that the opportunity for that drug must be large, even for an expensive genome editing drug, and imply, you know, possibly tens of thousands of sickle cell disease patients may be addressed. Is that a reasonable interpretation? And if so, should we be trimming down the total addressable market for sickle cell disease And, you know, this also applies to five or so other additional companies pursuing similar functional cures. So I'm just curious what your perspectives are on that. Thank you.

Yeah, Jim, how are you doing? Thanks for the question. You know, it's hard for me to comment on Vertex and how they model their business. I can tell you that from my perspective, I think if you could provide effectively a cure with a pill that's very safe, that's going to be extremely attractive. And that's what we're really focused on doing. And as Kim said earlier, we think we can figure a lot of that out, quite frankly, fairly quickly because the evidence that you've cured a patient is really pretty much ascertainable by looking at their red blood cell health and red blood cell function. So we think we're going to figure that out fairly quickly. If we could make gene therapy as simple and safe as vaccination, for example, I think that would be very, very attractive. But unfortunately, that technology does not exist. And when that technology exists, quite frankly, GBT is likely to be involved in that. But right now, given the ablation, given the lung hospitalization, the risk of cancer and other things after these big ablated procedures, we think a safe pill-based curative therapy would be the winning therapy.

And our last question comes from Raju Prasad with William Blair. Please proceed with your question.

Hi there. Thanks for taking our question. This is Sammy on Virage. I was wondering if you could provide a data point on the average number of prescriptions a single prescriber is prescribing. And then, I guess, if you could provide any color on the two small molecules you recently licensed from BioVerity and how they complement or overlap with the use of Oxprida or your other pipeline assets. Thank you.

Hi, Sandy. So I'll take the first one and then defer to DJ on the first question. I'll take a second. So the Sanofi molecules that we brought in are small molecule targets. And the program actually already has molecules which are active against the targets and significant amount of data supporting that activity. We don't disclose the specifics of our targets. but I would say that they are both highly complementary with Oxbrita and would be complementary with 601. So they work through a distinct mechanism. One is really more focused on polymerization, and the other is more focused on inflammation, which we think would have more of a direct relationship to VOCs, the pancreases. distinct and complementary targets, even though we haven't really delivered publicly what exactly the targets are. We're very excited about them, but they are early stage, but complementary.

EJ? Yeah, in terms of number of prescriptions per rider, so in totality, about half of our existing riders have written for more than one patient, but that's really being driven by kind of the low deciles in that sample that are just getting started at using Oxbrita. When you look at the higher decile physicians with more experience and more patients, it's much higher than that. It's greater than 75% of them have prescribed Doxbrita for more than one patient. On average, writers write it for over about three and a half patients launched to date, and that's still growing. Those higher decile doctors, it's over six patients per prescriber. So it's one of these situations, of course, physicians that have more patients and more urgent need are going to get more experience, and they seem to like the response as the real-world evidence would support because they write it for multiple patients.

We have reached the end of the question and answer session. At this time, I'd like to turn the call back over to Ted Love for closing comments.

Thank you, everyone, for joining the call today. Let me close by reemphasizing that all of us at GPT are very optimistic about the future. We look forward to further expanding adoption of OXPRIDA, advancing our pipeline, and supporting the sickle cell disease community as we work to transform the lives of patients for the better. We hope you continue to stay safe and healthy. Please reach out if you have any additional questions.

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.