Incyte Corporation

Greetings, and welcome to the Insight Fourth Quarter 2024 and Full Year Financial and Corporate Update Conference Hall and Webcast. At this time, all participants are in listen-only mode. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. You may be placed in the 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.

Thank you, Kevin. Good morning and welcome to Insight's fourth quarter and full year 2024 earnings conference call. Before we 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 discussion. On today's call, I'm joined by Irve, Pablo, Christiana, who will deliver the prepared remarks. Matteo and Steven 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 SEC filings for additional detail. I will now hand the call over to Hervé.

Thank you, Ben, and good morning, everyone. So we delivered another strong year with 2024 total revenues growing 15% versus 2023 to reach 4.2 billion, continuing the steady growth we have delivered since 2020. In addition to the consistent performance of JacaFi in 2024, we saw strong growth from our non-JacaFi revenue, primarily driven by Obsedora, highlighting our continuing revenue diversification. Moving to slide six. In 2024, JacaFi net sales were $2.8 billion, growing 8% versus the prior year, with growth coming from all indications. Obcelora saw strong continued momentum in 2024, growing 50% to $508 million, driven by both new patients and refills in A.D. and vitiligo in the U.S., and expanding reimbursement outside the U.S. We expect Obcelora to continue to be a key contributor to growth in the next years. Our cash flow remains strong, which allowed us to complete a $2 billion share repurchase during 2024 while maintaining a strong balance sheet. We ended 2024 with $2.2 billion in cash and no debt. We are in a very strong financial position with growing revenues and a robust pipeline that will deliver a number of very exciting readouts in 2025. Last month, we and our partner, Syndax, announced that the FDA approved Nictinvo in 9 mg and 22 mg vial sizes, paving the way for the commercial launch. This medicine is now available in the U.S., and the commercial launch is underway. Nictinvo is the first anti-CSF1 antibody approved to target the inflammation and fibrosis associated with chronic GVHD. And we are excited to bring this new therapy to the approximately 6,000 patients who are currently treated after second-line therapy in the U.S. In addition to the launch of Nictinvo, the SNDA for roxalitinib cream in pediatric atopic dermatitis was filed with the FDA, and we are on track for potential approval in the second half of 2025. With 2 to 3 million pediatric patients in the U.S. suffering from atopic dermatitis, we see significant opportunity for oxalicinib cream with its compelling efficacy in controlling itch to address an important need for this patient population. We submitted pivotal study results to the FDA for both staphacitamab in follicular lymphoma and retifanlimab in squamous cell anal carcinoma and anticipate approvals for both in the second half of 2025. These product launches are expected to begin contributing to revenue in the near term with the potential to collectively generate $1 billion in incremental revenues by 2029, further diversifying our revenue. We anticipate all four products to be available in 2025, and we will be leveraging our existing commercial infrastructure established for Jakafi, Opselura, Monjubi, and Pemazir to support the launches of these new products or indications. Moving to slide 9, an update of the fourth quarter and full year 2024 commercial performance for JakaFi. In the fourth quarter, JakaFi net product revenue grew 11% year-over-year to $773 million and grew 8% for the full year to $2.8 billion. Total patients increased 10% in Q4 when compared to the same quarter in 2023. Importantly, growth is being seen across all indications, but with particular strength in PV, with this indication now accounting for 35% of the patients on JAKA5. We expect continued growth of JAKA5 in 2025 and expect the full-year net product revenue for 2025 to be in the range of $2.925 to $2.975 billion. Turning to slide 10 and looking at JAKAFI total paid demand by indication during 2022, 2023 and 2024. As you can see, unit growth remains robust. Myelofibrosis showed growth again this quarter, while the most significant growth was seen in polycythemia vera. We expect PV to become the largest contributor for JAKAFI over time, supported by the data from the MAGIC-PV study which underscores the benefit of early intervention with Jaka-Fi and its impact on thrombosis-free survival. Moving to Opsalura on slide 11, Opsalura net product revenue in the fourth quarter was $162 million, up 48% when compared to the same quarter last year, and this was comprised of $138 million in the U.S., driven by growth in AD and DT-Ligo new patients and refills, and $24 million ex-U.S., driven by growth in Germany and France. Total 2024 full-year net revenue grew 50% versus 2023 to reach $508 million. In the U.S., the annual prescription trends for 2022, 2023, and 2024, as shown on the right of slide 11, reflects continued year-over-year growth of Opsalura from both atopic dermatitis and vitiligo. We anticipate continued growth of Obcelera in 2025 and expect the full year net product revenue to be in the range of $630 to $670 million. On slide 12, so 2025 will be a year of defining catalysts that will provide an inflection point for Insight. As you can see highlighted on slide 12, every program has meaningful milestones expected in 2025. This includes four potential launches, collectively providing important near-term revenue potential, where the launch of Nictimvo is already underway, as I just highlighted. Additionally, we plan to initiate at least three phase 3 studies, including our BET inhibitor, Roxcrim in mild to moderate HS, and our CDK2 inhibitor in ovarian cancer. We expect 2025 will be a data-rich year with four pivotal data readouts, including Roxolitinib XR, which Pablo will highlight shortly. More importantly, we expect seven early-stage programs to generate informative data, which we believe have the potential to transform the company. Before I hand the call over to Pablo, I would like to provide a leadership update for our commercial organizations. After a remarkable decade of dedicated service to InSight, Barry Flannelly has decided to retire from his role as Executive Vice President, Head of US Oncology. We are pleased to announce that Mohamed Issa assumed Barry's role in January, and Mohamed has successfully led US commercial teams in oncology, immunology, and neuroscience, most recently at J&J. I will now turn the call over to Pablo.

Thank you, Hervé, and good morning. As we highlighted a year ago, and we summarized on this slide, we remain on track to deliver more than 10 high-impact launches by 2030 from programs across the portfolio. On slide 15, I would like to quickly highlight some of the key accomplishments during 2024, and I will then cover some of the milestones expected in 2025. We had a number of important regulatory achievements in 2024, including the approval of NIC-TIMFO for Third Line Plus chronic graft-versus-host disease, and three submissions to the FDA with expected approvals later this year, including Opsilur and Pediatric Atopic Dermatitis, Retifanlimab in SCAC, and Tafacitimab in relapsed or refractory follicular lymphoma. We disclosed data from our CDK2 inhibitor and BET inhibitor programs and provided pivotal study plans for both, which we anticipate initiating this year. We continue to evolve at R&D Focus with intent of increasing the rigor of our decision-making accelerating the progression of our pipeline and optimizing our resource allocation. Through the fourth quarter of 2024, we presented data at the American Society of Hematology Annual Meeting, or ASH, from both our BET inhibitor program and Phase III results for tefacitimab in patients with relapsed or refractory follicular lymphoma. The Phase III results of tefacitimab in follicular lymphoma were presented at a late breaking session and showed that the study met its primary endpoint by demonstrating a statistically significant and clinically meaningful improvement in progression-free survival. This was, to our knowledge, the first study to validate the combination of an anti-CD19 with an anti-CD20 monoclonal antibodies in patients with follicular lymphoma. Tefacitamab was generally well-tolerated, and safety was consistent with its known safety profile. This data had been submitted to the FDA and approval is expected in the second half of 2025. For our BET inhibitor, we shared additional data from the ongoing dose escalation study as both monotherapy and in combination with ruxolitinib. These results show reductions in spleen volume as well as improvements in both symptoms and hemoglobin. As highlighted on this slide, we plan to advance this program into Phase III development as a monotherapy in the post-JAK population, and we look forward to providing additional details later this year. Moving to slide 18, we are continuing to execute a broad development plan for povacitinib, our oral, small-molecule, highly selective JAK1 inhibitor. Povacitinib is currently being evaluated in Phase III studies in Hadronitis Suprativa, Vitiligo, and Prurigo nodularis, and in randomized phase II proof-of-concept studies in chronic spontaneous urticaria and asthma with data for both expected in 2025. Oversitinib has already shown encouraging efficacy and safety in a randomized phase II study in patients with moderate to severe hibernitis superativa, a highly painful inflammatory condition. As highlighted on this right side of the slide 19, Pulvercidinib showed significant responses by week 12, including improvements in high score 50, 90, and 100. Additionally, Pulvercidinib demonstrated a rapid and significant reduction in pain, offering the potential to transform the current standard of care for this disease. The two phase 3 studies, STOP-HS1 and STOP-HS2, are fully enrolled, and we expect to have phase 3 data in the first half of this year. Turn to the mutant cholera antibody program on slide 20. The publication detailing our mutant cholera monoclonal antibody was recently featured on the cover of Blood, highlighting the importance of this innovative medicine. This antibody was developed entirely by Insight, and unlike Jackify, the mutant cholera antibody has the potential to eliminate the mutant clone and normalize hematopoiesis in patients with cholera-mutated essential thrombocytemia or myelofibrosis. potentially leading to a functional cure. We look forward to sharing data from the ongoing proof-of-concept studies in both ET and MF later this year. Turning to slide 21 and ruxolitinib XR. We're pleased to announce that a bioequivalency study of ruxolitinib 55 mg extended release demonstrated the once-a-day formulation to be bioequivalent to twice-a-day ruxolitinib. by equivalence was achieved for both AUC and CMIN, and the geometric means ratios falling within the 80 to 125% by equivalence reference range. We have reviewed this data with the FDA, and with their agreement, plan to submit for approval by the end of the year once stability studies are completed. As mentioned, 2025 will be an important year for Insight, with over 18 key milestones, including four new product launches, four pivotal trial readouts, at least three phase three study initiations, and seven proof of concept study results. As you can see on slide 22, we have already achieved two of these milestones that we first highlighted just last month with the launch of NICTIMVO and bioequivalency data for ruxolinib extended release. We look forward to sharing additional updates on these milestones over the course of 2025. And with that, I would like to turn the call over to Christiana for the financial update.

Thank you, Pablo, and good morning, everyone. Our fourth quarter 2024 results reflect strong commercial execution and continued growth with total revenues of $1.2 billion, up 16% versus the same period last year. Total product revenues of $1 billion in Q4 were driven by strong demand growth for Jakafai and Opsalura and increased revenue contribution from Monjuvi as a result of the acquisition of full rights to tafesitamab in 2024. Total royalty revenues were $159 million, up 6% compared to Q4 2023, driven by increased demand for jacavi. Turning to jacafi on slide 26, jacafi net product revenue was driven by strong patient demand growth across all indications. In the fourth quarter of 2024, net product revenue increased 11% year-over-year, driven by a 9% increase in total demand and a 14% increase in paid demand. For the full year 2024, net product revenue increased 8% versus 2023, driven by a 7% increase in total demand and a 9% increase in paid demand. Recall that in Q3 and Q4 2023, we saw a significant increase in the number of Medicare Part D patients receiving free product. As we anticipated, these patients returned to paid demand in 2024. As a result, year-over-year paid demand growth exceeded total demand growth in both the fourth quarter and full year 2024. Turning now to Opsalura on slide 27, total net product revenue for the fourth quarter was $162 million, representing a 48% increase year-over-year, driven by growth in new patient starts and refills across both AED and vitiligo in the U.S., as well as continued contribution from the commercialization of Opsalura for vitiligo in Europe. In the fourth quarter, ex-U.S., Opsalura net product revenue was $24 million. For the full year, net product revenue was $508 million, representing a 50% increase year-over-year, and ex-US net product revenue was $61 million. Moving on to slide 28 and our operating expenses, total GAAP R&D expenses for the fourth quarter were $466 million, an increase of 5% compared to the same period in 23, due to continued investment in our late-stage development assets and timing of certain expenses. For the full year 2024, ongoing R&D expenses, excluding the Asian acquisition upfront consideration and other one-time expenses, increased 14% year-over-year as a result of increased investment in our late-stage programs. As we wrap up the clinical developments of certain of these programs, as well as the development activities of discontinued programs, we anticipate the reduction in investment in those programs to partially offset the increased investment in other programs, which would allow us to control future R&D expense growth. Moving to SG&A, total GAAP SG&A expenses were $327 million for the fourth quarter, representing an 11% year-over-year increase primarily as a result of Insight now recording Monjuvi-related sales and marketing expenses in the U.S., following the acquisition of global rights to the program in 2024, as well as the timing of consumer marketing activities and certain other expenses. For the full year 2024, total GAPES GNA expenses increased 7% year-over-year as a result of us now recording Monjuvi-related sales and marketing expenses, and investment in the launch of Opsalura in Europe and the preparation for new product launches in the U.S. Finally, total ongoing R&D and SG&A expense for the full year increased 10% versus a 15% increase in total revenues, leading to an increase in operating leverage and margins. Moving on to 2025, I will now discuss the key components of our guidance on a gap basis. For Jackathai, we expect net product revenue to be in the range of $2.925 to $2.975 billion, well on track to achieve our long-term guidance of over $3 billion by 2028. We expect net product revenue growth to be driven exclusively by continued demand growth, primarily in PV, and be partially offset by lower net pricing as a result of IRA-imposed price increase caps and continued growth in 340B volumes. As in previous years, we expect the gross-to-net adjustment to be higher in the first quarter of the year relative to the previous quarter and subsequent quarters due to higher deductibles that are primarily impacting Q1. For Opsilura, we expect total net product revenue to be in the range of $630 to $670 million, driven by continued demand growth in AED and vitiligo in the U.S., initial contribution from the potential launch of Opsellura for pediatric AD expected in the second half of the year, and increased contribution from Opsellura for vitiligo in Europe. In the first quarter of the year, we expect to see again the effects of typical Q1 dynamics on net sales due to plan deductibles resetting at the beginning of the year, and the impact of holidays, medical conferences, and other events on dermatology product sales. As a result, Q1 of cellular net product revenue is expected to be below the previous quarter, consistent with what we saw in 2024. For other oncology products, we expect total net product revenues to be in the range of $415 to $455 million. These include contribution from both the current approved indications for Recluse, Ictinvo, Monjuvi, Minjuvi, Pemazir, and Zainis, as well as the launches of Monjuvi NFL and Zainis NSCAC anticipated in the second half of 2025. Turning to operating expenses on a gap basis, we expect COGS to range from 8.5% to 9% of net product revenues. The increase in the COGS rate is driven by certain manufacturing-related expenses and the impact of our profit-share agreement with Syntax for Nictimbo in the U.S. a syntax's portion of the profit share will be reflected in COGS. R&D expenses are expected to be in the range of $1.93 to $1.96 billion, primarily driven by the progression of our pipeline. We expect SG&A expenses for the year to be in the range of $1.28 to $1.31 billion. Operator, that concludes our prepared remarks. Please give your instructions and open the call for Q&A.

Certainly. We now be conducting a question-and-answer session. If you'd like to be placed into question queue, please press star 1 on your telephone keypad. We ask you please ask one question, then return to the queue. You may press star 2 if you'd like to remove your question from the queue. Once again, that's star 1 to be placed into question queue. Our first question is coming from Michael Schmidt from Klugenheim Partners. Your line is now live.

Good morning. Thanks for taking our question. This is Paul. I'm for Michael. We have two on the pipeline. First, on Opsalora, can you set some expectations for the upcoming phase three in perigonodularis? What's the clinical bar here, given there's no topical therapies available? And then secondly, just on the CDK2 program, are there any plans to provide another clinical update on the phase one ovarian cancer study, perhaps with longer follow-up at the expansion dose levels? And what are the gaining factors to formalizing a pivotal study dose selection? Thank you.

Certainly. Good morning. Thank you for the questions. Let me take the second one real quick. For the CDK2 program, as we discussed earlier this year, we plan to initiate pivotal trials this year. And as we discussed, that will be in platinum-resistant ovarian cancer. We're taking a dual approach there with a single-arm study for what we hope will be accelerated approval in the U.S., as well as a randomized trial that we will provide more details over the course of the year. So that That program is advancing rapidly, and we will provide an update later this year, as you asked. The second part of the question, in terms of Rux cream and Perigo nodularis, as you know, the Phase III data are coming in this half. And I think what, you know, in terms of setting the bar, when you look at the Phase II data, and the improvement both on the global assessment of itching as well as the WNRS endpoint. We think that if we are anywhere in the vicinity of what the phase two trial showed, this is going to be a very important addition to the momentary for patients with prurigo nodularis. The availability of a topical for patients that have perhaps less severe disease than those that may require systemic medicine such as povercidinib, we think it's going to be very important. So we want to be somewhere, and as we all know from the extensive safety track record of Raxgrim, it's a very, very well-tolerated medicine. So if we're anywhere near what the Phase II results showed, I think it's going to be a very important contribution for patients.

Thank you. Next question is coming from Tazin Ahmad from Bank of America.

Your line is now live.

Hi, guys. Good morning. Thanks for taking my questions. As it relates to Opsalura, can you give us a sense of how you got to guidance for this calendar year? Specifically, how were you thinking about the number of tubes that are going to be used for the two approved indications? And then maybe one question on POVOR for the HS data that's due in the first half of this year. What would you consider to be not only statistically significant, but also clinically meaningful data? Thanks.

Hi, my name is Christiana. Regarding the OPSELURA guidance, first of all, when you look at the guidance range that we provided, the $630 to $670 million for the year, it represents a 24 to 32% year-over-year growth. As we indicated in our prepared remarks, this is driven by continued demand growth in AD and vitiligo. and also reflects the potential launch of Opsalura in pediatric AD in the second half and contribution from that indication and continued increased contribution from Europe. The range that we provided primarily reflects variations in the patient mix as well as in the level of patient activation rate and adherence in vitiligo and the level of contribution from Europe. In terms of the tubes, the level of tubes, that's especially around vitiligo is reflected in the level of patient activation rate and adherence. We are seeing an increase in the average number of patients that are sticking with therapy and therefore refill their prescription, and also in the average number of patients prescriptions per patient, but as we have commented in the past, this is an area that is evolving, and we expect to continue to evolve as we pursue additional initiatives to help patients, educate patients, and help them appropriately use vitiligo, the Opsilura for vitiligo, and that is reflected in the guidance range that we have provided. Finally, the other thing, again, to keep in mind as you think about the guidance and how do you distribute it through the course of the year, Q1, as I mentioned in my prepared remarks, always tends to be lower than the previous quarter and the subsequent quarters. We saw that in 23. We saw it in 24 when we expect to see the same dynamics in 25.

Let me take the second part of the question. So, look, the first and most important thing is obviously to have a positive study or two positive studies. And that, as you know, means statistical significance for the primary endpoint, which in this case is high score 50 at week 12 in the two hydroinitis supertiva studies for POVO. Now, beyond that, I think that when one looks at the phase two results with the povacitinib study, and you look at the totality of the data, and that is effect on high score 50, 75, 90, and 100, as well as the strong effect on pain improvement that the study showed, together with the safety profile, when the phase two was very clean. In that study, there were no thrombotic events in the high-dose POVO arm. There were no patients that discontinued due to adverse events in the POVO arm. So I think that the profile that we've seen in phase two, and we realize there's always a little bit of contraction in phase three, a little bit of, you know, the results can change a little bit, but we believe the overall profile that we saw in phase two, if we are somewhere in the vicinity of replicating those results in the phase three studies, we think we have a very competitive profile with povercidinib and heteronitis supertiva.

Thank you. Next question today is coming from David Lebowitz from Citi.

Your line is now live.

Thank you very much for taking my question. Given the IRA out-of-pocket has moved to its go-forward levels at 2,000 per year, can you run us through what the process is that a patient must go through to actually ensure that the cap is put in place? What steps do they need to take and how long do you think it might be until the benefit of that starts showing up in sales?

So the cap for the out-of-pocket this year is reduced to $2,000 a year. Patients do have an option to have this spread through the course of the year in equal payments. There is a process that they would have to go through. We expect that it would take some time for them to figure out that process. So we may not see the immediate benefit right away, although we expect to see a continued benefit from the lower out-of-pocket as we saw in 2024.

Thanks for taking the question. Thank you.

Next question is coming from Jessica Fly from J.P. Morgan. Your line is now live.

Hey, guys. Good morning. Thanks for taking my questions. A couple on POVO in HS. So I think north of 60% of the patients in your Phase III trials are biologic-naive. Are you going to seek a label that includes biologic-naive patients, or do you expect it will be labeled for post-biologic patients? And then within the trials, are you powered for both the biologic-naive and experienced subgroups? Is there anything you can say about the powering assumptions there?

Yes. So, as you point out, and we haven't discussed the specific percentage, but it's roughly directional if that's correct in terms of biologics, naive and biologically exposed patients. Prior exposure to biologics is a stratification criteria in the phase three trials. We expect to analyze the data based on prior exposure to biologics. I'm not going to comment on the full powering. Obviously, the studies are powered on the basis of assumptions around the primary endpoints and the key secondary endpoints for the study. So we'll discuss the results in more detail. And obviously, in terms of labeling discussions, we'll see what the data looks like and we'll discuss with FDA at the right time.

Hey, Pablo, can I follow up on one of the responses, too? I think it was Tazine's question. When you said... If you show something that's close to what you showed in phase two, that would be super competitive. Because I think the phase two deltas on high score 50 differed a little bit if you look at the 16-week versus the 12-week time point. And I think in phase three, it's a 12-week. So when you say close to phase two, do you mean close to the 12-week cut of phase two or close to the 16-week?

Yes, you're correct. So if you remember, the placebo subtracted high score 50 at week 12 is 28%, and at week 16 is 17% in the phase 2 studies. That's, I think, what you're referring to. Look, we selected week 12. It's a key. One of the key differences, I think, when you look at the POVO data, not just in HS, but also in PN, for example, is how quickly it works. And that is very important for patients with painful or intensely pruriginous diseases like HS and PN. So that's the importance of the week 12. My comment was referring roughly to replicating the profile that we saw in phase two. I don't want to set a number. We're running the phase three studies to have clarity on what the actual benefit of povacitinib is in large phase three studies, Jess. The number, the specific percentage that we see is not something we're going to comment on right now, but a profile that is consistent with the phase two is what we expect to see in the phase three. Thank you.

Next question today is coming from Salveen Richter from Goldman Sachs. Your line is now live.

Good morning. Thanks for taking my question. Just a follow-up here on POVO. With regard to the the phase two data, and we saw this drop from week 12 to week 16. Could you just speak about the read-through to this trial and the risks that may play out there? And then also, in your 2025 guidance, just speak to us about how you model for a Part D redesign for Jackify. Thank you.

Certainly, I think, look, Clinical trials, particularly in diseases like HS, which they have a placebo effect, as you know, you're going to see some movement on the efficacy endpoints and the efficacy curve over time. What we saw in the phase two, as both you and the previous colleges pointed out, was that from week 12 to week 16, there was a drop in the placebo-subtracted response in the POVO arms. It's probably variability and noise related to clinical trials. We are not concerned about that. The studies are well-powered to demonstrate what we believe is a statistically significant difference between POVO and placebo. And we think we'll see not only a statistically significant but a clinically meaningful impact of POVO on the primary endpoint, which is high score 50 at week 12, as well as the key secondary endpoints, which include obviously other levels of clinical benefit and other time points in this study.

Regarding your second question, Salvin, on the impact of the Medicare Part D redesign on gross net for JakaPi, we do expect to see some savings in Medicare Part D, since our contribution to the Donut Hall will now be replaced by 1% participation to the catastrophic coverage, given that we have the small biotech exception. However, these savings would be offset by continued increase that we see in 340B.

Thank you. Our next question today is coming from James Shin from Deutsche Bank.

Your line is now live.

Hey, good morning, guys. I just wanted to follow up on Pover's stop HS1 and 2 phase 3 trials. How will you disclose this data? Will we get a press release with high score top line followed by full data at a middle conference? And then any update on the X2 program for CSU? Thank you.

So on Provo for HS, our plan is once we have the data is to disclose in a press release and almost certainly we have a call to discuss the results with investment community. On 262, I don't have an update at this point. We are still completing the evaluation of the events that we described late last year. in the preclinical findings in the toxicology, and we'll provide an update later this year.

Thank you. Next question is coming from Vikram Purit from Morgan Stanley. Your line is now live.

Hi, good morning. Thanks for taking our questions. We had just one on the proof of concept data sets expected for Neu and KLR, and then also for JAK2B617FI for later this year. Could you just help us kind of frame what we can expect to learn and what you're setting at the bar for accessibility data sets and what the hurdle is going to be for moving these programs forward? Thank you.

So let me start with Mutant Call R. So as you point out, we'll have proof of concept data this year for both patients with ET and MF. That will come over the course of the year. What we expect to see, and just to First of all, let me tell you a little bit about what you're going to see, and it's going to be a substantive amount of data. We expect to have data at different dose levels with some amount of follow-up in order to have clarity on some of the important measures of success for those programs. Obviously, we discussed over the past few months the importance for this program not only to show an impact on the traditional endpoints in patients with myeloperifitive neoplasms, such as blood counts, symptoms, spleen, et cetera, but also to see some early evidence of allele reduction, which we think it's an important measure of success. This is not going to be obviously definitive data, but we want to have some evidence that a mutant collar antibody in patients with ET and MF can show some evidence of allele reduction. So, that will all be part of the update. 617F, if you recall, started in the clinic later. We started dosing patients with MF in the third quarter of 2024, so it's a little bit behind. We intend to have an update this year. And the same points apply, basically, to that program. We would like to see impact, not only a traditional endpoint, but some early evidence of value reduction in that program as well.

Thank you.

Next question today is coming from Mark Fromm from TD Cowan. Your line is now live.

Thanks for taking my questions. Maybe to start, one nuanced question on Stop AHS. Pablo, you mentioned earlier, you know, often these trials do have a little bit of a decline in treatment effect from Phase 2 to Phase 3. In AHS specifically, we've seen changes in antibiotic use and how that's treated with an SAP, you know, maybe drive some of that effect. Can you remind us just how antibiotic use is being treated, was treated in Phase 2, and how that may or may not differ in the Phase 3 trial? And then for Christiana, on the Opsalura guidance, can you break down some of the assumptions there on U.S. versus ex-U.S. growth, just given the kind of label changes that are happening, but also increasing reimbursement outside the U.S.?

So let me take the first part of the question. So First of all, the use of antibiotics in the phase three is treated the same way it was in the phase two. So let me just remind you what that is. Patients are not allowed to be on systemic antibiotics at study entry. Over the course of the study, if patients are started on systemic antibiotics for a flare, that's treated as a non-responder. Now, if a patient is started on a systemic antibiotic for a completely unrelated reason, that is not treated as a non-responder. And that's consistent with the phase two.

In terms of the Obsolura guidance, the guidance that we have provided is global, and it does reflect increased contribution from Europe. In 2024, the contribution was primarily driven by Germany and France. And in 2025, we expect continued contribution from those two countries, but also now increased contribution from Italy and Spain. we are not going to be breaking down the guidance between the two regions.

Thank you. Next question is coming from Kelly Shi from Jefferies.

Your line is now live.

Thank you for taking my questions. I have two. Firstly, can you share a little bit more color on KRAS 212D program in terms of POC data? What kind of sample size and also tumor indications could we expect? And also, based on the preclinical data achieved so far, do you think it hints any potential differentiation from other competitive G12D programs? And for Paul, we just quickly want to confirm, for the high score of 75, 90, and 100, do you plan to show at a 12-week follow-up only or actually both 12 and 16 weeks? weeks follow up.

Thank you. Thank you, Kelly. So in terms of KRAS, so the indications here that have been the focus for us are pancreatic cancer and colorectal cancer. And specifically in pancreatic cancer, we're trying to accelerate enrollment because obviously it has become a very competitive space. We're fully aware of what our competitors are doing. we believe based on the profile here that we have preclinically, which is highly selective and potent G12D inhibitor, that if we accelerate this program, we can still compete in this space. Now, it will come down obviously to the efficacy and safety that we see, but when we look at the data from our competitors, we think that particularly as you move to early lines of therapy in combination with chemotherapy, there's still space for a highly selective, well-tolerated G12T inhibitors. So, we look forward to discussing data later this year, but that continues to be our view. In terms of what we're going to disclose for the POVO-HS studies in terms of other endpoints, that's not a decision that we've made at this point. Obviously, we'll have to communicate the overall results of the studies, as I answered a little bit earlier here, but whether we add a number of other endpoints to that release, we haven't decided.

Thank you. Next question is coming from Brian Abrams from RBC Capital Markets.

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Hey, good morning. Thanks for taking my question. Maybe on the BET inhibitor, can you talk about the role you foresee for that in a post-JACIFY monotherapy setting? And then what's your latest thinking on the frontline development path? What are you looking for out of the treatment that you've combo-dated to move forward, and are we still looking for results from that this year? Thanks.

Certainly. So on the second line, look, I think that today, as we know, eventually, as good as JAKAFI is for patients with myelofibrosis, eventually all patients progress, and they need better treatment options when they progress. Obviously, in addition to the BET inhibitor, we're developing the mutant color antibody in the V617F inhibitor, but in the you know, in the relatively near term, we think that the BET inhibitor can provide a very good treatment options for patients with MF that progress after JAKIFY. That's why we are accelerating that second line program as much as we can. And we disclosed the basic design at ASH, and you'll hear more of an update later this year. In terms of first-line indication for the BET inhibitor, what we need are more data. We need more clarity on the safety profile and the impact on endpoints that has a combination with JAKAFI in previously untreated patients. We showed an update at ASH, which we think is very encouraging in terms of the ability to combine our beta inhibitor with JAKAFI and the impact on spleen symptoms and, importantly, the impact that we saw on hemoglobin in the presentation that we gave at ASH. So we're still encouraged by the data. I think we need additional data to make that decision and to have another conversation with FDA on a potential first study. Thank you.

Next question today is coming from Jay Olson from Oppenheimer. Your line is now live.

Oh, hey. Congrats on the quarter, and thanks for taking the question. For ruxolitinib XR, also congrats on achieving bioequivalence. Can you just talk about your plans to commercialize RuxXR and also the timeline for a fixed dose combination with your BET inhibitor? Thank you.

So maybe on the commercialization, I mean, the timeline is basically we are now waiting for the end of the stability study to submit to FDA by the end of this year. So that will, it's a response to a CRL. So it's a slightly different timeline than we should be. commercializing in 2026, which if you look at the window it gives us versus the 2029 first generic of twice a day is around two years and a half. And obviously the goal of that during that period is to have as many patients as possible being treated with once a day as a single agent as JAKAFA is used today in most indications, in most patients. Now, related to the first-line study and the bet combination, obviously the whole program depends on what Pablo was just speaking about, which is the profile of the first-line combination. And also, if you think about it, of how the rest of our portfolio in MPN is evolving with the Cala and the 670 net. So none of that has been firmly decided yet, but that's probably going to be happening over the next year or so. on how we can put it in combination with our BET inhibitor on that.

Thank you. The next question is coming from Eric Schmidt from Cancer for the Child.

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Great. Thanks. Two questions here. This is Imogen on for Eric. The first one on POBO and HS. You shared about the high school 50, 12, and 16 week. I guess in terms of high school 75 as well, could you share any ranges of what you think would be meaningful and competitive data there in the evolving landscape? And then the second question is on the tafacitimab first line and DLBCL study. What do you see as meaningful data there over the R-CHOP-LEN arm? Thanks.

Okay, so on the first one, on proven HS, I'm going to have to give a similar answer to what I've given earlier, which is obviously you want to see statistical significance for the primary endpoint. The key secondary endpoints obviously are not similarly powered, but they are important endpoints to show a clear difference with placebo. I don't think it's productive to really set a bar for what we have to clear. If you look at the data from the Phase II study with the 20% at week 12 and 13% placebo-subtract at week 16 for POVO, I think those are really strong results in the context of prior data releases in patients with HS. So if we are in the vicinity of those results, I think that's going to be a very important contribution. In terms of top-line first-line, the first-line DLV-CL study, as you know, this is a curative setting. even a small impact on the primary input of the study, I think could be really, really important. And if you look at recent benchmarks, such as the Polyvi data, which showed a modest impact on PFS, it still has led to a substantial adoption of that in frontline patients. So I think it's a very clear indication where modest improvements could lead to a potentially wide adoption because you're talking about potentially curative therapy.

Thank you. Next question today is coming from Matt Phipps from William Blair. Your line is now live.

Yeah, thanks. Two for me. One, can you maybe just remind us on the learnings from the robust trial that were incorporated into FrontMind, where do you think you can succeed when that trial fails? And then for the Meet and Call Our program, is that just going to be monobit therapy this year, or could we also get some Jackify Combo therapy? And can you remind us pre-clinically if you saw any differential activity between type 1 versus type 2 mutations in Cal-R?

Thank you. So, in terms of the mutant Cal-R antibody, you know, we haven't really decided. We have initiated a combination with Jaka-Fi. The specific details of what we're going to disclose, we haven't really decided, but it's possible that we'll disclose some Jaka-Fi combination data. It's an important part of the development plan, you know, As we've discussed previously, we don't necessarily commit to a combination development for the mutant cholera antibody, but it's possible that because of the really rapid and strong impact of JAK-FI on patient symptoms, particularly as you know, as well as other endpoints, a short induction with JAK-FI combined with mutant cholera and then a long-term maintenance therapy with mutant cholera antibody could be a treatment paradigm. But none of that has been decided. We'll discuss the development plan, the future development plan for the mutant cholera antibody when we disclose the data. What we have disclosed in this type 1, type 2 is that these two types of mutations are very different in the structure in the gene. And what we've discussed previously was that the affinity for the antibody for type 1 versus type 2 is pretty different. In terms of what we expect to see in the clinic, We'll discuss that when we have the data results, but it's possible that we have a different level of activity in patients with different types of mutations.

Thank you. Next question is coming from Andrew Berens from Learing Partners.

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Hey, thanks. Congrats on the big quarter in 2024. A couple more on Jacopi XR. I don't think you commented on the CMAX. Wondering how that lift as you increase the dose to boost the CMAX. And is there anything else that's gating approval other than the stability studies?

So in terms of XR, so look, you cannot replicate the C-max with a once-a-day formulation compared with twice-a-day formulation. The FDA understands that, and that was not the purpose of the study. So that, what you have to meet is obviously the AUC at steady state and the C-min at steady state. As we disclosed in the slide deck, both of those endpoints were met. The only gating factor is the stability studies. As I mentioned in my prepared remarks, we have discussed the results of the study with FDA, and we have an agreement with them on the stability studies necessary for the resubmission, for the response to the CRL, and we expect that that will be done before the end of the year.

Thank you. Next question is coming from Andy Chen from Wolf Research.

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Hey, thank you for taking the question. So, on POVO-HS again, can you talk about specific protocol differences between your trial and other trials, especially from IL-17 antibodies? What have you learned from other trials and what might you be doing differently to amplify your efficacy here? And then also, in your base case scenario, are you expecting only the high dose to be approved or both doses?

Thank you. You know, and it is difficult to get into specific differences between studies because we don't have all the details of every protocol that's out there. We think that the design of the phase three studies is consistent with the way our competitors are studying patients with hadronatus suprativa. We designed the phase three to have a slightly higher percentage of patients with Harley 3 as opposed to Harley 2. That was an important point that we wanted to emphasize. in order to reduce the placebo effect, since it's harder in patients with more advanced disease. And that was an important point that we wanted to emphasize. I think that there were a couple of things that we did, as well as, you know, we were carefully selecting sites. We run a series of trainings with the sites, which was consistent with what we did in the Phase II, to make sure that the way these patients are assessed by the investigators is consistent with what we did in Phase II. We try to replicate in phase three as much as we did in phase two. And obviously, as I mentioned earlier, the primary endpoint we selected based on the phase two data, I think that was an important lesson in order to really see how quickly we can provide benefit to patients with a week 12 improvement, which also was the best endpoint for us in our phase two study. In terms of the dose, when we have the data, we'll discuss with FDA, obviously, Yes, it's possible that if both doses are positive, we will lead to a broader label with different rates of doses, but we'll discuss that when we have the data with FDA.

Thank you. Next question is coming from Celine Sayed from Muzuho. Your line is now live.

Hi. Thanks for taking our question. This is Eric on for Celine. So just looking at modeling JAK5 through 2025, just wondering how we should think about the growth versus 2024 and how we should think about that through the year. It's more loaded in the first half, second half, anything like that. Thank you.

So the guidance range that we provided implies a year-over-year growth of 5% to 7%. In terms of how to model it through the year, remember that Q1 always is the lowest quarter and lower than the prior quarter. And this is because of the reset of the deductibles at the beginning of the year, which on the commercial side, you would expect to continue to see this year. And even on the Medicare Part D, unless patients get to spread it through the course of the year, it will continue to have more of an impact in the first quarter of the year. So expect Q1 to be the lowest quarter and lower relative to Q4 of 24. Thank you.

Next question is coming from Evan Siegerman from BMO Capital Markets.

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Hi, guys. Thank you so much for taking my questions. Two for me, just walk me through some of the initial assumptions for the pediatric Upsalura launch. You know, what does this initial uptake curve look like and how much is factored into your guidance? And second, kind of a hypothetical here, would you ever consider an adalimab head-to-head trial in HS versus POVO, given that you want to establish yourself as the systemic standard of care in this market? I'm just thinking as, you know, this is A biosimilar market, you're coming in as a branded, and it could help you kind of getting a leg up here. Thank you.

Yeah, Matteo, I'll take the ADP's launch. We're very excited about the opportunity that we have there to help these patients between 2 and 11 years old, also because the very vast majority of them are still uncontrolled and pretty much on steroidal therapies. Obviously, in the second half of the year, we will see the initial uptake from that indication contributed to our net sales. But overall, in terms of sizing at peak, we think that that opportunity will represent anywhere around 10% and 15% of the total topic dermatitis of the salura business.

Let me take the second one. We have not discussed in the past whether to conduct a head-to-head study with adalimumab. You know, there's a couple of points there. First of all, let's wait to see the data for the HS1, for the two HS studies that are coming. Once we have the data in hand, we'll make decisions about future development. The challenge with the data that has been reported in the past with Humira, and when you discuss this between physicians, is that while the response rate that has been reported was high and which has not been replicated since the original study, The drug failure on Humira is relatively fast. Patients with HS seem to progress relatively quickly. This is one of the reasons why HS has become such an important market, such an important indication for a number of companies, because there's a fair amount of dissatisfaction with the data, with the results in the real world with Humira. At this point, we haven't made a decision to do a head-to-head study. Future development in HS, we'll discuss it after we have the data. Thank you.

Next question is coming from Ash Verma from UBS. Your line is now live.

Great. Thanks for taking my question. Just one. So, on 4.1 HS, I wanted to understand what is your view of the potential upcoming readouts from competitors? You have Senelicumab and RINVOV. How would that impact your value proposition for POVO in this market? Thanks.

So, at risk of being repetitive, so if we look at the phase two data we've reported in a number of places, both week 12, week 16, and the totality of the data across all the endpoints, high score 50, 75, 90, and 100, and pain response, we think we have a very competitive profile with POVO. Assuming everybody has a certain level of correction from phase two to phase three, we believe that when you put together all the efficacy data together with the safety profile we saw in the phase two, that we have a very competitive profile with Biologics and certainly with RIMBOC.

Thank you. Next question is coming from Kripa Devarakonda from Truist Securities.

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Hey guys, thank you so much for taking my question. On Jacify, I think that PV is primarily driving growth. Can you talk about the patient population where you're getting uptake and what the expectations are in terms of growth? Is it primarily through new patient ads or duration on therapy as well? And beyond RuxXR and the V617S inhibitor, Any additional lifecycle management plans for your footprint in PV that seems to be growing? Thank you.

Yeah, I can speak. I mean, as you see, I mean, PV of the strain indication is the one that is growing the fastest, and it is driven by earlier treatment, and that's based on the data we have shown that by treating early, you can basically reduce the incidence of thrombosis. So... basically help patients have a longer thrombosis-free survival. And that was the magic study that we have been sharing with physicians over the past year, and it has been driving this adoption that we are seeing in PV, as well as the change in the Medicare co-pay for the Medicare patient, which is also helping in PV. So we, as we said in the prepared remark, we think PV will become the largest of the three indications over time, driven by this new earlier patient flow and the duration of treatment we are observing in PV. Regarding the overall portfolio, obviously, V617F mutation is the cause of 80% to 90% of PV cases in the U.S., so that would be the key driver of the next generation of products for Insight.

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 closing comments.

Thank you all for participating in the call today and for your questions. The IR team will be available for the rest of the day for any follow-up. Thank you and goodbye.

Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.