Pharming Group N.V.

Hello and welcome to today's Farming's Fall Year 2022 results call. My name is Bailey and I'll be the moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star followed by one on your telephone keypad. I would now like to pass the conference over to our host, Simon De Vries, Chief Executive Officer.

Please go ahead. Thank you very much, Bailey. Good morning or good afternoon, ladies and gentlemen, to our 2022 results call. I would like to start taking you through that, but before I do that, I would like you to pay attention to the next slide, which contains a statement on forward-looking statements. As we may be making forward-looking statements in this conversation, they are statements based upon are expectations and assumptions and involve known and unknown risk and uncertainties that could cause actual results, performance, or events to differ materially from those expressed or implied in these statements. And you can read the rest for yourself, I assume. I'm today here. Next slide, please. I'm joined by my colleagues, Dr. Alan O'Grallon, our chief medical officer, and Jeroen Wackermann, our chief financial officer. And we also have here, although not speaking on the conference, but to answer questions, our Chief Commercial Officer, Steven Torr. And I would now like to start with the next slide, please. And then the next one. So where are we? We have developed over the years a very strong base with potential for significant growth. And that is based upon the commercialized asset RUCNESP, recombinant human C1 esterase inhibitor for the treatment of acute hereditary angioedema attacks, which is commercialized by ourselves on both sides of the ocean, as you can see in a lot of other markets as well outside of the U.S. and the European Union and, of course, the U.K. The potential for growth. is represented here initially by the anticipated approval and a launch for lanioli PI3 kinase delta inhibitor in development on the regulatory review for APDS where we anticipate in the not too distant future the FDA approval and later on during the year the European approval. And we are developed, we have morphed ourselves into a company that is focusing on development and commercialization of rare diseases. And the first thing that goes beyond the APDS indication for laniolisib will be that we are quite far along with investigating laniolisib for additional rare disease indications. We are based in Leiden, the Netherlands, and we are here actually in our US headquarters in Warren, New Jersey, where we speak to you from. And, of course, we are a public company since 1990 in Amsterdam and since 2020 on the NASDAQ. So let's look at our business model on the next slide. We're really on our way to building a sustainable rare disease business, whereas we are now commercializing Brukenest, albeit on both sides of the ocean. The vast majority of sales come from the United States. So we're now a one-product company with one geography. But that's We expect to be changing very soon with the anticipated approval of Lenny Olissen for APDS, which will represent not only a possibility for very significant growth of our US commercial footprint and revenue base, but also a very significant revenue generator outside of the US. So we're looking forward to this year being a transformative year from which we transform from this one product, one geography, company into a multiple products, multiple geographies company. And of course, like I said before, we are quite far on our way and we'll update the market as and when later in the year to actually start additional development programs for laniolisib and additional diseases. And then last but not least, since we have a very scalable commercialization infrastructure in both Europe and in the US, we're actively hunting for additional products. in rare diseases to either in-license, that is our preferred mode of action, and if not otherwise possible, mergers and acquisition transactions to basically bolster that pipeline further and get that flywheel, really get that flywheel going that we have here with our scalable commercialization operations on both sides of the ocean. And in the next slide, you can see the pipeline, and you can see immediately what I mean with that, whereas Ruconest is on the market and Leniolisip very close to the market. And of course, if we start clinical trial programs in secondary indications for Leniolisip, there's still a considerable gap between those two products or those three products in the near future and the preclinical assets that we have in the form of OTL105. the HAE gene therapy, and alpha-glucosidase from our transgenic platform, just like Ruconest for pompous disease. So let's look at Ruconest being the strong foundation under our company. We returned it to growth again after the COVID pandemic. We returned to growth in 2022 as we were guiding single-digit growth over 2021, and that is something we are very proud of. Ruconest was launched at the end of 2014, so it's already quite a mature asset and has found its unique place in the market. It is the only recombinant treatment that targets the root cause of hereditary angioedema by replacing the missing or dysfunctional C1 esterase inhibitor. And over the years, it has proven to be very well tolerated and effective and continues to be a very effective treatment for the treatment of acute hereditary angioedema attacks, including, and that becomes increasingly important, those breakthrough attacks that people suffer from when they use prophylactic treatments. And that is indeed continues to be an issue, but although prophylactic treatments have become, and I'm especially referring to the United States market, of course, where the vast majority of our sales come from. And although the prophylactic treatments have become a lot better, they all have the same issue that up to half of those patients suffer from breakthrough attacks. And breakthrough attacks can come very frequently or very rare, but they come always at a moment that you don't expect it. That's why it is always the case, it is good practice in the United States that when you are in prophylactic treatments, you always have acute medication at hand, at home, to actually inject yourself in the case of Ruconest with the rescue therapy. And that becomes increasingly important. And that is also why we see increasingly that Ruconest is being used by more doctors and used by more patients to actually treat those breakthrough attacks. And it is, we can very proudly say, the second most prescribed product that is detailed for acute attacks. And as you can see here, the efficacy numbers speak for themselves on this slide. and we are finding that our patients feel very, very confident to administer the treatment themselves. It's a slow IV injection and the very vast majority of patients do inject themselves or by their loved ones in the privacy of their own homes. So Ruconest, it has been on the market for a long time and will continue to play a very important role supporting our business with sales, and with important cash flows that enable us to invest in all those future programs that we are embarking on. So with that said, I would like to now switch over to the promise for significant growth of the company in the very near future. Lenny Olisip for APDS, and I would like to hand over to Dr. Anurag Rallon, who sits here next to me, to take you through the story of APDS and Lenny Olisip.

Anurag, over to you. Thank you, Simon. In the next few slides, what I'd like to do is review some information that we have on our understanding of the condition APDS, our understanding of the patient journey, and what we've done in terms of developing laniolisib for APDS, and then using all of this information to help identify patients. And then lastly, provide an update on where we are in terms of regulatory status. So on the next slide, we can see a schematic here of how this genetic defect in one of these two genes leads to this hyperactivity of this pathway. You can see that within the cell there on the left. And that hyperactive pathway then leads to this dysregulated B and T cell development. So these key components of the immune system do not develop properly. And as a result of not developing properly, patients suffer from a number of symptoms and conditions that you can see on the right. Most prominently, these patients develop recurrent infections. They also, because of this abnormal development of their immune system, have what's called lymphoproliferation. So they get swollen lymph nodes. Their spleen is enlarged. They have problems with expansion of lymphoid tissue, especially in the gut, and that can lead to a condition called enteropathy. And not only do these immune system cells not fight infection, they actually lead to the opposite problem where they lead to a condition called autoimmunity. And this can lead to autoimmune anemias and cytopenias and other autoimmune disorders. But it's also important to note that APDS is a progressive condition. So over time, the disease worsens. And many of these patients, even at a young age, develop a condition called bronchiectasis, which is essentially scarring in the lungs that is irreversible. And many of these patients, unfortunately, go on to develop lymphoma, again, due to this unchecked lymph proliferation and this abnormal development of their immune system. On the next slide, we can actually see what the consequences of this are on the patient themselves. Of course, we've talked about the physical consequences of recurrent infections. I mentioned bronchiectasis, and that can result in shortness of breath, coughing. just difficulty to do their normal activities. And you can see that that can impact their social wellbeing and as well as their mental wellbeing, but there's a significant treatment burden. These patients are frequently hospitalized. They have numerous surgeries, many of them unnecessary, especially when they've not been properly diagnosed, numerous doctor visits. So it's a condition that impacts many facets of these patients' lives. On the next slide, we see what's possible now in the current management of APDS. And that's really trying to address the consequences of the condition. So not addressing the root cause, but trying to address the symptoms. So what the symptoms of the manifestations are infections. So these patients are frequently on antibiotics, either prophylactically or to treat their infections. Most of these patients are on immune globulin replacement therapy. And then again, on the flip side, when they have autoimmune complications or immune dysregulatory complications, They're put on steroids, other immunosuppressants, or a class of drugs called mTOR inhibitors to try to modulate their immune system. None of these therapies, of course, are FDA approved for this specific treatment of APDFs. And again, the worst condition, worst possible outcome for these patients is that they need a stem cell transplant. And unfortunately, even stem cell transplants, although potentially curative, have significant morbidity and mortality associated with them. On the next slide, we can see the future now and what we're developing is Leniolisib, which is a targeted disease-modifying treatment for APDS. And Leniolisib specifically blocks the PI3K pathway and thereby modulating and trying to return to normal the activity in this pathway. A consequence then of that should be that we can actually develop the immune system properly and then again impact all the other things that are the downstream effects of that abnormal immune system development. And we've gone on to study that together with Novartis, and you can see in the next slide the overall clinical development plan, which includes a number of studies, dose-finding studies, a placebo-controlled study, and at the bottom, a long-term extension study. There are patients now in that long-term extension study that have been treated for a number of years, several patients over five years, one patient who's been in the study now for seven years. So we have extensive data on the use of Laniolus, both in a long-term perspective, but also in a placebo-controlled fashion. And in the next slide, we can see some of those results. We see that the randomized control study met both primary outcomes, which was, number one, to increase the number of naive B cells. Again, these are B cells that were not developing properly as a result of that underlying disease. hyperactive pathway. We were also able to achieve decreased lymphadenopathy. Again, this was a primary manifestation of APDS. On top of that, when we look over in the randomized study, as well as over longer periods of time, these patients' spleen size shrinks. We see improvements in those autoimmune complications. We see in general that the drug was also well tolerated. In the data package that we submitted to FDA, for example, we have a median exposure of of two years for the patient population. On top of that, when we start looking at the longer term outcomes, we see that these patients are getting less infections and they're using less immunoglobulin replacement therapies. So despite using less of the therapies that needed to control infections, they're actually getting less infections. So it's actually very nice to see how impacting that pathway can impact the immune system and then can actually have an impact on all of these clinically relevant endpoints in terms of infections and also reduction of immune-globulin replacement therapy. On the next slide, we can see where we are now in terms of safety. And what we see when we look at the randomized controlled trial data is a comparison of laniolisib on the left with placebo on the right, and you see a very similar profile in terms of the grade of adverse events that were experienced by these patients. And that mimics what we see in the long-term extension data. So, in general, lineals has been well-tolerated. And again, as I mentioned earlier, we have some patients on the therapy in the study for several years now. On the next slide, we can see the activities that we've been conducting to help find patients. And there's a number of activities as we begin to understand the disease and this patient journey that help us inform how to go about finding these patients. We, again, estimate that based on a prevalence of one to two per million, there's more than 1,500 patients in the key markets where we intend to commercialize laniolisib first. We've already identified 500 patients in these markets. Much of this has been done through a partnership with Invitae, which involves a genetic testing program that is at no cost to patients that can make a definitive diagnosis for these patients. We also have a number of partnerships with medical organizations, patient organizations, and these are critical in helping us to uncover these patients who have this rare primary immune deficiency. And we've received tremendous support in these partnerships. Again, these patient organizations who are who really have the same goal that we do, which is to help improve the lives of these patients with these rare and ultra-rare diseases. On the next slide, we can see where we are now with our regulatory status. As Simon mentioned, we have filed in the US. It's under review with a priority review designation for patients who are enrolled in the in the programs that I described, which were adults and adolescents age 12 and over. We also have an ICD-10 code in place, and we have a number of physicians already using that code. So that's also nice to see. And we have coming up at the end of this month, the expected decision from FDA on the 29th of March. And we expect that later this year, still in the second quarter of this year, we expect to be able to commercialize pending a positive decision from it. In Europe, we've also filed an application there. We also have a positive designation on our pediatric investigation plan, which, of course, is necessary to begin the filing process. We originally received accelerated assessment. This has now been switched to a standard assessment as EMA have requested additional data. We still, however, anticipate that CHMP will be able to provide an opinion later this year, in the second half of this year, with an approval to follow approximately two months later. And with the UK regulators, we expect to be able to file soon after the CHMP. And on the next slide, you can see this over time, some of the key anticipated milestones. Earlier this year, we were able to begin the first of two pediatric studies. And again, we have FDA regulatory decision coming later this month with the U.S. commercial launch soon after that. We're also going to be getting a new study in Japan, and we expect that to also occur in the first half of this year. And as I mentioned earlier, we're expecting a CHMP opinion as well as a UK filing in the second half of this year.