Incyte Corporation

Hello, and welcome to the Insight fourth quarter and full year financial results conference call and webcast. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Christine Cho, head of investor relations. Please go ahead, Christine.

Thank you, Kevin. Good morning and welcome to Insight's fourth quarter and full year 2022 Earnings Conference Call and Webcast. The slides presented today are available for download on the Investors section of our website. Joining me on the call today are Herve, Barry, Stephen, and Christiana, who will deliver our prepared remarks, and Dash, who will join us for the 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. and are subject to a number of risks and uncertainties that may cause our actual results to differ materially, including those described in our reports filed with the SEC. We will now begin the call with Hervé.

Thank you, Christine, and good morning, everyone. 2022 was another successful year in which we delivered strong commercial performance and made significant advancements across all stages of our oncology and dermatology pipelines. Revenues from our current portfolio of commercialized products grew 18% year-over-year, both in the fourth quarter and for the full year, to $764 million and $2.7 billion, respectively. Total revenues for the year, which include our royalty, grew 14% to $3.4 billion. As we look across our portfolio, the drivers of this double-digit growth are the continued commercial execution for Jackify, net sales of which increased $275 million in the year to reach $2.4 billion, and initial contributions from recently launched products and indications, including Minjuvi and Pemezir in Europe and Japan, and Opselora in the U.S. I want to touch briefly on Opselora, which we believe will be a significant growth driver for Insight. Opselora was approved in September 2021 for atopic dermatitis, and this past July we received approval and launched Opselora in vitiligo as the first FDA-approved therapy for repigmentation. The approval was well received by dermatologists, patients, and patient advocacy groups, and the launch has been very successful. Strong patient demand and increasing formulary access drove net sales of 61 million in the fourth quarter and 129 million for the full year. In 2023, we expect an approval for Opselora and Vitiligo in Europe, which adds another layer of growth for the franchise. Turning now to our regulatory and R&D achievement, our clinical development pipeline is focused on three therapeutic areas, MP and GVHD, other hematology and oncology, and dermatology, and we made significant progress across each of these three areas. In Limburg, we presented new data from ongoing combination studies and disclosed an important new discovery asset targeting mutant cholera, which has the potential to be a disease-modifying therapy for approximately 30% of patients in MF and ET. In other hematology and oncology, we presented updated data for our oral PD-L1 inhibitor, 2-8-0, which shows promise both as a monotherapy and combination agent. We also progressed parsaclizib into phase 3 for warm autoimmune hemolytic anemia, a disease in which there are no approved therapies. And in dermatology, we continued to expand our portfolio with Obcelora and Povercitinib focusing in disease areas where there is a significant unmet need. Lastly, we had two important updates relating to patents. The first is that INSIGHT earned pediatric exclusivity, which entitles INSIGHT to six months of exclusivity added to our patents for JAKAFI and OBSERWA. This expands our ability to enforce our JAKAFI patents through December 2028. This extension further applied to our existing Obserora patent. In addition, late last year, we obtained an issued patent and allowed claims for the treatment of atopic dermatitis and vitiligo, respectively. We are confident in the strength of these claims, permitting us to protect Obserora out to 2040 in the U.S. Before moving into the outlook for 2023, I wanted to take a moment to look back at the growth of our product revenues as shown on slide 6. Over the past five years, approvals for new products and indications, as well as strong commercial execution of our existing portfolio, has allowed us to grow our product revenues at a CAGR of 18%. On slide 7, looking at our historical operational performance. On the left is our revenues versus our total R&D and SG&A spend. We have delivered strong operational performance over the past five years, with total revenue growing at the 17% CAGR and our operating expenses growing at the 13% CAGR. On the right, we are showing our operating leverage, excluding the impact of dermatology on revenues and sales and marketing expenses. Here you can see our operating performance is even more pronounced. We can expect to drive further operating leverage over time with our high-growth dermatology franchise, which is in early stages of launch and where we could see two additional approvals in the near term. Turning to slide 8, as we look ahead for insights, there are four main drivers of sustainable growth, and we are already making significant progress in each of these areas and expect to continue the strong momentum throughout 2023. The first driver is our JAKAFI franchise and LIMBER program, where we aim to expand our leadership in MPN and GVHD. In 2023, beyond the approval of Roxolitinib XR, we expect important data, including pivotal results for our part-activity combination in suboptimal responders to JAKAFI in MF. Next is Opselora, where we are launching in AD and VT-Ligo, and where in 2023 we will be launching in Europe. In other areas of clinical development, we expect new data from our oral PD-L1 program and povacitinib in prurigo nodularis and VT-Ligo. Lastly, we will be monitoring early data from our CDK2 and mutant color program. With that, I would like to pass the call to Barry.